John Drinnan: What's the point of TVNZ?

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TV1 Breakfast hosts Jack Tame and Hilary Barry.
TV1 Breakfast hosts Jack Tame and Hilary Barry.

All media firms are in upheaval, but in my opinion, there are particular questions about the role of the state in advertising.

For example, why are taxpayers taking the risk of owning a company that offers unexciting returns in a sunset industry?

TVNZ is legislated to provide a commercial focus, and public broadcasting ventures such as the Sunday morning non-commercial shows are commissioned only when taxpayers pay most of the costs.

On Wednesday, TVNZ announced an interim profit of $12.9 million, up 1 per cent on last year, on advertising revenue of $159m, down 5.1 per cent.

Beyond these modest returns, what is the point of TVNZ?

Former Broadcasting Minister Steve Maharey says there appears to be no point in state ownership as a way to deliver public broadcasting.

He says one option is to sell TVNZ and use the interest from a (guesstimated) $200 million pricetag to fund a new public broadcasting platform. It would also need some taxpayer funding,

A major impediment, it strikes me, is whether there are many potential buyers in the free to air TV market.

Maharey says interest on the $200m and other funding might provide $13m a year - the same amount the previous Labour Government provided to fund TVNZ 6 and TVNZ 7.

Television NZ killed off those channels because they did not fit with its commercial model.

Maharey acknowledges there will be opposition to selling a public asset. But he believes commercial instincts are so entrenched at TVNZ that it could not adapt to a public broadcasting focus. "We tried that and it did not work," says Maharey.

Rethink for Vodasky

The Commerce Commission rejection of the Vodafone-Sky merger is a body blow for both companies.

Subject to a possible appeal, I believe it means they will now need to review their business plans.

Earlier this week, Sky TV revealed a fall in the number of subscribers. Had the merger gone ahead, an in-house distribution deal for mobile phone rights might have provided fresh revenue.

As for Spark, the question will be whether it now pursues the wider argument about Sky's dominance of sport broadcasting, and whether it pushes on with its negotiations to run Netflix in NZ.

TV fine tuning

Television New Zealand says it is talking with staff about changes to make the company's operations more sustainable.

The admission comes amid speculation about looming layoffs at the state owned broadcaster.

TVNZ spokeswoman Georgie Hills says TVNZ is "always" talking to staff about making it more efficient.

"What that means is that we are having a range of conversations across the business.

"When we have something to share we will be happy to communicate that," she says.

Soft centre

MediaWorks says it is happy about the first few days of its new 7pm show, The Project.

I can see that the fast pace of TV3's new programme might appeal to younger viewers who want bite sized news. But for some of us, it needs some news nous to give it an edge.

Presenters Jesse Mulligan, Kanoa Lloyd and Josh Thomson can handle confectionery news. But in my opinion, this chocolate needs a hard centre, like the multi-talented Waleed Aly, who is the host of the Australian version.

On week one it needed some big hitters among the guests.

On Monday, we had Rove McManus, owner of The Project format, which suggested the show was on training wheels. On Tuesday, former model Kylie Bax was guest panellist.

Now, the only point of having Kylie Bax was surely to quiz her on her reportedly close friend Donald Trump. Alas, Jesse Mulligan ruled that out, saying she must be sick of the media and all those Trump questions.

You have to ask the question, Jesse.

Maybe there was an agreement to not delve into the matter of Trump.

Money for movies

Subscription on demand TV services around the world are increasing the options for consumers.

And the NZ Film Commission says the trend to services such as Netflix is also helping kiwi films to find buyers and recover a substantial portion of their budgets

This week chief executive Dave Gibson attended the valuable film markets attached to the important Berlin International Film Festival.

It is too early to specify sales for the New Zealand films taken to Berlin, but he says Netflix was active at the markets, buying content, as were other "over the top" TV services.

"It's a critical point," says Gibson.

"In the past, where markets were wholly focused on theatrical [cinema] release, some films would not sell at all, and that would shut them out of downstream sales of other rights.

"The prices might be less than the theatrical rights, but it might deliver considerable chunks of dough towards covering the budgets," says Gibson.

- NZ Herald

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John Drinnan has been a business journalist for twenty years, he has been editor of the specialist film and television title "Screen Finance" in London, focussing on the European TV and film industry. He has been writing about media in New Zealand since the deregulation of the television industry in the late 1980s.

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