Fran O'Sullivan: Media marriages leave rest looking for partners

The Commerce Commission now has two major "media" marriages on its plate and others sure to follow as the sectoral shakeout ramps up.

Yesterday, Sky TV and Vodafone painted their merger proposal as a "strategic partnership of equals".

The concept was remarkably similar to that used by NZME and Fairfax when they unveiled their plan last month.

Except the commercial bogeymen differ: Google and Facebook are the disruptors changing the game for the publishers. When it comes to NZ's pay TV operator (and its telco partner) Netflix is a key threat.

Vodafone CEO Russell Stanners was also confident that his firm's merger presented fewer competition problems than the NZME/Fairfax NZ marriage. That may be the case, but the publishers do have first mover advantage in the commission's timetabling.

Yesterday, it was "business as usual" at Spark NZ as it pushed the line that the Vodafone/Sky TV move simply formalised and deepened that existing partnership.

It won't be BAU - the rapid changing media and telco environment makes that concept an absurdity and convergence a reality. What is clear is the two proposed media marriages lessen the merger options for remaining players.

They also change the value equation.

Sky TV CEO John Fellet emphasised they looked at several permutations before closing with Vodafone NZ.

Clearly, MediaWorks' is in play. But it would be naive to think that the chess board has not also changed for TVNZ and RNZ. At some point the market is going to run out of equals - that's when we'll start talking about winners and losers.

- NZ Herald

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Head of Business for NZME

Fran O'Sullivan has written a weekly column for the Business Herald since its inception in April 1997. In her early journalistic career she was a political journalist in Wellington and subsequently an investigative journalist who broke many major business stories including the first articles that led to the Winebox Inquiry in both NBR and the Sydney Morning Herald. She has specific expertise in relation to China where she has been a frequent visitor since the late 1990s. She is a former Editor of the National Business Review; has twice been awarded Qantas Journalist of the Year and is a multiple winner of the Westpac Financial Journalism Supreme Award.

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