The impact of Covid-19 on the media landscape deepens with New Zealand's largest employer of journalists offloaded to management for $1 and a major radio and television company announcing 130 job losses.
Stuff's owner, Nine Entertainment, announced on Monday that after more than four years up for sale Stuff was sold to its local chief executive, Sinead Boucher, for a nominal $1.
The news came just minutes after it emerged that Mediaworks, owners of TV3, told staff that it was shedding staff from its radio, sales and billboard advertising units. MediaWorks staff who volunteered for paycuts for an initial three months were told that this was being extended to six.
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Across the industry jobs have been threatened by a sharp decline in advertising, despite the public's thirst for journalism being arguably stronger than ever due to the severe restrictions put in place to contain Covid-19.
The sale of Stuff came just a fortnight after Nine Entertainment rejected an offer from NZME, owner of the Herald, to buy the company for $1, the final stage in a years-long attempt to merge the two newspaper companies.
Stuff is best known for the Stuff website and newspapers including the Dominion Post and the Sunday Star Times. The deal ends 17 years of Australian ownership, previously under Fairfax Media.
As part of the deal Nine Entertainment will book a hit of A$45 million (NZ$48.2), but nevertheless analysts at Morgan Stanley said the deal represented an "incremental positive" for the company's shareholders.
In a statement to the ASX, Nine said it could recover more of the proceeds from the sale of wholesale broadband business Stuff Fibre "depending on the Stuff business's ability to raise funding".
Despite this, Boucher told the Herald that Stuff could continue for the foreseeable future without raising money even in the event that further support from the Government was not forthcoming.
So far there had been no conversations with potential funders, Boucher said, but Stuff may choose to seek investment depending on its decisions to invest in new areas.
"It will depend on what we decide to do or where we look, or if we look, for extra funding to help us achieve that," she told the Herald.
Announcing the deal, Boucher revealed that the company's "plan is to transition the ownership of Stuff to give staff a direct stake in the business as shareholders".
She was not able to give details of how this would work.
"The last couple of weeks have been very busy, just rushing to get the deal done and signed last night, and now we'll be taking some advice on what's the best way to structure that."
Despite the merger process ending with NZME taking Nine to court in a bid to enforce what it said was an exclusive negotiation period, Boucher said yesterday that she had "always" supported the deal.
NZME chief executive Michael Boggs even welcomed the news, saying his relationship with Boucher had been constructive and he wished the company well.
"NZME believes a buyer for Stuff who will protect jobs, newsrooms and mastheads would be a positive outcome for New Zealand media and New Zealanders."
The news came as MediaWorks chief executive Michael Anderson acknowledged the company was "in a fight for survival". Despite cost-cutting measures and staff taking salary cuts it was not able to continue at its current size.
"It is truly one of the hardest things I've had to do in my professional career," Anderson said in an email to staff. The cuts will see around one in eight staff made redundant.
MediaWorks' TV business was largely excluded from the cuts, suggesting the business, which is for sale, may be close to finding a buyer.
The troubles of MediaWorks, New Zealand's largest privately owned television company, extend across the industry, which has seen a sharp drop in revenue from advertising.
While it has so far not announced job losses, last week a spokeswoman for state-owned broadcaster TVNZ said that the need for further cost savings was "inevitable" due to a drop in revenue.
"We have successfully offset near-term revenue declines with operational cost reductions, but don't expect revenue to fully recover in a hurry.
"Further cost savings are inevitable and TVNZ will look to preserve investment in local news and entertainment content, and maintain jobs where possible."
At the same time, SkyTV - which has been hit by bans on sport - announced that it had managed to raise almost $120m from investors.
The Government has already announced a support package worth $50m across the sector.
Broadcasting, Communications and Digital Media Minister Kris Faafoi said he felt for staff at MediaWorks, but Monday's news was a reminder about the volatility in the media sector, exacerbated by the pandemic.
"The Government is working through the details of its longer-term approach to media sector support which can ensure a strong, sustainable, and diverse news media for New Zealanders and we will have more to say on that in the coming weeks."