The advertising market is on the mend. But New Zealand On Air may extend a deal giving TVNZ and MediaWorks a helping hand through the recession.

Television bosses heaved a sigh of relief last week when the Budget was released.

The Government maintained the allocation to New Zealand on Air which subsidises TV production to the tune of $74.7 million.

The $50,000 grants to multinational record companies to make albums is also safe.

Even some folk in the Wellington arts bureaucracy were surprised the Nats did not touch subsidies that are often used for commercial TV shows.

Maybe it will hit next year's Budget as the Government looks at ways to fund the switch-off of analogue television signals.

In the meantime, it is business as usual for a television sector dependent on subsidies.

New Zealand On Air is also prepared to consider a second year of largesse to help the networks.

Last year, for the first time, it offered special terms to broadcasters so they did not have to contribute so much to the cost of commissioning programmes.

The special arrangement was to take account of the major advertising slump and is set to expire in August.

The argument is that NZ On Air wants to maintain the level of local content, but that relies on an assessment of networks' ability to pay a share of the costs.

New Zealand On Air chief executive Jane Wrightson said that as part of the deal, New Zealand On Air could extend that helping hand for another year.

But as yet, she said, the networks had not approached New Zealand On Air for an extension and it would consider an approach when it was made.

It would be if surprising two commercial companies did not put their hand out again for more. It's free money - why would you not apply?

Like all media they have been hit by a downturn in advertising in the past year. That has eased, but both TV3 and TVNZ have troubles.

The big question for NZ on Air as it decides whether to reduce the TVNZ and TV3 contribution is their ability to pay the full amount.

How much is the financial situation of the two companies the result of the advertising downturn?

How many of TV3's woes are the result of its huge structural problems, and how many of TVNZ's problems can be blamed on the cross-subsidisation of its new online arm?

EASBY DOES IT

Josh Easby's appointment as a governor of Radio New Zealand is another sure sign changes are ahead for the state broadcaster.

He has a track history of implementing change. Richard Griffin - tipped to take over the chairmanship next year - will provide the charm offensive to staff. Easby will likely be using his media experience to fashion a change in policy on the board.

The former New Zealand Truth, Auckland Star and Sunday Star journalist moved to management when Brierley owned New Zealand Newspapers.

It was in radio that he established his media management credentials.

He was manager for Radio Hauraki before heading in the 1990s to Prospect Group, which owned about 12 radio stations in Auckland and Hamilton, including Hauraki and Radio i.

Prospect was owned by British company GWR which subsequently sold the stations to The Radio Network.

In 1999 Easby moved to Britain with GWR, where he established formats and new stations, then worked for APN News & Media, where he handled special projects.

Easby would make no comment.

But the message must be clear to chief executive Peter Cavanagh, who has resisted change. The board at RNZ will be active next year. It is still not clear whether it will be for the better or the worse.

WHOOPSIE

After Mike Hosking's ringing support for Mark Hotchin last week, Paul Holmes appeared to make a Freudian slip when he was filling in for Leighton Smith on Newstalk ZB yesterday.

Holmes was talking about the looming presence of the Mt Eden prison, and casually mentioned "the Hosking Mansion on Paritai Drive", before hurriedly correcting himself that he meant Hotchin.

It's no secret Holmes was encouraged to make way for Hosking on Newstalk, but this may well have been a slip of the tongue by New Zealand's most accomplished broadcaster.

Meanwhile, I was reminded recently that Hosking's comments in support of the Hotchins and criticism of an article by Sunday Star-Times reporter Jonathan Marshall could be viewed in a historical context.

In 2003, Marshall as a paparazzo was sacked from a job as a reporter on Queer Nation after tailing Hosking in his car. Marshall contributed to a website - NZ Tabloid - that showed pictures of Hosking's children at a time their publication was the subject of a major court battle.

NOVEL PLANS

These are heady days in Adland, with breakaway independent agencies blooming left, right and centre.

Sugar has done well, as have Barnes Catmur & Friends, and Special Group. Now New York-based Droga5 is setting up in New Zealand.

So with indies in the ascendent there will be great interest in the plans for Richard Maddocks, who is leaving the ultimate corporate creative role as executive creative director at Clemenger BBDO in Sydney.

Maddocks - or Mad Dog as he is known - has said he eyes working for a smaller, "alternative" agency.

He headed the Colenso BBDO creative department when Brent Smart was in charge and it was a halcyon period for creativity.

He says he is looking to write a novel, to be set in New Zealand. Maddocks is a close friend of Droga5 New Zealand partner Mike O'Sullivan, but for the record, Droga5 says he will not be joining the team.

BAD ADS

Colenso BBDO announced the latest re-jig for its creative department, promoting Levi Spavin - who it says conceived the brilliant Tip Top "togs, togs, togs" campaign for Publicis Mojo - to be one of three creative directors for the agency.

Spavin has been at the agency only six months - maybe he can convince Colenso BBDO client Fisher & Paykel to rethink its TV advertising.

When was the last time F&P ran a good TV ad? I know, I know. Bad ads are memorable. They provide cut-through.

But the "lost sock" campaign - with the miscast actor John Callen playing the bearded, white-coated scientist - is cringe-inducing.

Agency folk outside Colenso say F&P has a reputation as a conservative client. Yet at the opposite end of the scale the campaign for new brand Elba - with the pitch that washing machines could not be relied on to do human tasks - was also oddly annoying.

KEEP IT KIWI

Is it me or are we at a low ebb for TV ad creativity at the moment?

Maybe it's because I have a PVR and routinely fast-forward through ad breaks. But when the long ad breaks do slip through - when the MySky remote falls down the back of the couch - there seem very few to love and lots to dislike.

* The TiVo ad. Good product, but the Sydney gal in these ads just does not look like a Kiwi.

TiVo is part-owned by New Zealand taxpayers so surely TVNZ can give its marketing a local feel. Is this why TiVo has sold so poorly in New Zealand?

* The new SkyCity Entertainment ad continues its focus on razzamatazz. But the ad from Assignment - featuring bouncy people having a wow of a time - doesn't tell a story and is terribly old-fashioned, showing girls at the pokies with a rock soundtrack.

Maybe the aim is to make Auckland look like Sydney - our local home of casino culture. But like TiVo, you'd think this entertainment brand would try to give its ads a Kiwi feel.

UP, UP, UP

Internet advertising continues its relentless growth. Total spend for the first quarter was up 12.3 per cent from $49 million to $53.3 million.

Internet Advertising Bureau chairman Michael Gregg said there was strong year-on-year growth across display, classified and search categories.

Display and classifieds have rebounded from the softening effect of last year's recession to record lifts of 15.3 per cent and 16.7 per cent respectively.