John Drinnan: Pressure on media leaves Govt unmoved

Broadcasting Minister Amy Adams : It's up to media companies to decide how they react to change. Photo / Mark Mitchell.
Broadcasting Minister Amy Adams : It's up to media companies to decide how they react to change. Photo / Mark Mitchell.

Most politicians have long taken the advice of the lobbyists and kept their noses out of regulating the media business, or giving it much thought.

They have steered away from trying to understand the forces at play in the escalating global shakedown - forces that have led to serious threats to local media and local journalism.

In my opinion, New Zealand's size makes it especially vulnerable.

Old dreams have been abandoned.

The local production industry was once seen as part of a bold future for the NZ economy. Now, the production business is dominated by overseas firms fighting for diminished network commissions and taxpayer handouts.

There seems to be no interest in media among ministers or government departments, which I would argue are fiddling while Rome burns.

Broadcasting Minister Amy Adams rejects the suggestion the Government is ignoring the impact of changes.

"How media businesses respond and adapt will be a matter for them and it's not for the Government to protect any particular business model," she told me. "Our concern is to ensure our regulatory regimes remain appropriate and fair, that Government owned businesses are positioned to respond appropriately and that we continue to ensure relevant NZ content is made available to local audiences.

"The Government will continue to monitor media sector change and always remains open to considering further issues as they arise," she said.

ComCom crunch

Media upheavals are coming to a crunch point.

Four companies are seeking merger approval from the Commerce Commission in two areas of the media.

The planned merger of NZME and Fairfax NZ would create a dominant group of newspapers - admittedly a diminishing medium - and dominance of digital news through ownership of nzherald.co.nz and Stuff. Meanwhile, Vodafone NZ and Sky TV plan to merge their operations.

The stakes are high, and the commission will also be looking at the potential impact on the companies if they are not merged.

When the NZME-Fairfax NZ merger was announced in May, it was depicted as a sure thing. That was because the commission would focus solely on competition for advertising and there was little geographic crossover between the two companies.

Last week the commission delayed its decision until March next year and in a surprise move, said it was examining issues of quality and quality, beyond the advertising world.

This raises the question of how the commission will consider those qualitative issues.
For the applicants, I believe one of the strategic issues is whether to offer guarantees or volunteer certain conditions, to ease concerns about the planned deal's impact and reduce the risk of approval not being granted.

Under its legislation, the commission can only say yea or nay to the merger, and cannot impose conditions. But its decision can incorporate any conditions offered by the applicants.

Clifftop stroll

I'm not sure that this Government really understands that local media are walking along a crumbling clifftop. The locals face a daunting challenge from global players like Google and Facebook, taking huge swathes of advertising revenue and paying minimal tax along the way.

Adams is right: changes to media are not unique to New Zealand. But other countries have public broadcasting institutions to provide the non-commercial services that the private sector media do not.

As things stand, the New Zealand on Air model is feeding the commercial needs of media which want subsidies to boost their margins.

Now journalists and new media companies also want a piece of the pie. Something has to give.

Culture vulture

Company culture is a factor in business, especially so in a sector such as media, which relies so much on relationships.

MediaWorks' appointment of Mark Weldon as chief executive took the company down a bumpy road which saw it at war with some of its staff and abandoning its ascendancy in news and current affairs.

In my view, the company lost the esprit de corps that gave it a clear cultural advantage over TVNZ.

The appointment of chief financial officer David Chalmers as temporary CEO, then the one-time Austereo chief executive Michael Anderson as a permanent replacement for Weldon, has eased some of the problems.

The departure of chairman Rod McGeoch has closed another door and new chair Jack Matthews is popular.

But I believe it's unlikely that the special nature of the company - which grew out of it challenging state media in the 1990s - can be revived.

Radio Maori

Radio NZ seems to have ended its confrontation with Willie Jackson and iwi stations over getting more Maori content on RNZ National. This week RNZ signed a memorandum of understanding with a network of Maori stations.

The agreement will see the Maori stations and RNZ sharing content and working together.

The memorandum acknowledges the view that Maori wanted more content on RNZ than it had delivered in the past.

Tensions came to a head last November between Jackson, head of the iwi stations, and RNZ head of content Carol Hirschfeld.

Elsewhere, there has been tension between Maori broadcasting and RNZ, with the Government boosting Maori TV's resources to please the Maori Party, while freezing RNZ funding. The broadcaster is said to be wary that Maori broadcasting gets two bites of the cherry: its own funding and a stake in what RNZ delivers.

- NZ Herald

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