Possible merger - 'seismic shift'

A newspaper delivery boy on his round - delivery by kids on bikes has ended, like many media activities.

The possible merger of NZME and Fairfax's New Zealand subsidiaries will have huge implications for media - if it gets Commerce Commission approval - but should have little impact on businesses associated with affected print publications and radio stations.

"This is certainly a seismic shift - we're in a period of huge change," said Gavin Ellis, senior lecturer in film, TV and media studies at Auckland University.

"Mainstream media are having to make decisions to ensure their survival, to stay in business."

However, he said advertisers, contractors and suppliers often have cross-company relationships and it should be business as usual.

"The truck that transports NZME publications from the printers in Ellerslie is likely to be also bringing up Fairfax publications. The NZME printing press in Ellerslie also prints the Sunday Star Times - there is already commercial co-operation between the two companies."

Mr Ellis did acknowledge there would likely be a reduction in the number of community newspapers in cities such as Whangarei, which has two competing mastheads.

He said the potential merger was about gaining efficiencies, which would lead to contraction within the industry.

"There will be job losses, there's no doubt about that," he said.

However, Dr Ellis said the merger was not a precursor to print media or radio about to disappear.

"Some industries have endured sustained severe downsizing and then recovered by adapting and becoming different," he said.

He points to industries such as coach building as well as aspects of the steel industry and others. Dr Ellis suggested that future for print media did not look that strong.

"Printing and distribution costs are onerous - it makes no sense to chop down trees and truck newspapers to consumers when there is a low cost digital platform available."

Both companies are being valued as part of the process and there is pressure on each to perform financially and retain or grow circulation over the next few months. A Commerce Commission decision will take four to six months.