Television New Zealand and Radio New Zealand (RNZ) could be disestablished and a new state broadcasting entity established if the Cabinet accepts the recommendation of a media advisory group.
Broadcasting Minister Kris Faafoi would not comment on a news report by RNZ that the advisory group has recommended setting up a new entity.
But he confirmed that he would take a paper to Cabinet and expected a decision before the end of the year.
And he said he hoped the decisions would set the path in public broadcasting for the next 15 to 25 years "to make sure it can survive in whatever the media environment is in the future."
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As well as receiving advice from broadcasting experts, a chief executives' advisory group was chaired by Ministry of Culture and Heritage chief executive Bernadette Cavanagh and included senior representatives from Treasury, the State Services Commission, Te Puni Kokiri and the Department of the Prime Minister and Cabinet.
Their advice was that the status quo was unsustainable, said RNZ.
They had considered three options: merging the TVNZ and RNZ newsrooms, boosting the funding of New Zealand on Air, and, the one it opted for, setting up an entirely new entity.
It would be a not-for-profit organisation, though not every part of it needed to be commercial-free.
Described as a "mixed funding model" it could raise revenue from advertising, sponsorship and subscriptions.
It would have a statutory protection for editorial and operational independence, according to guidelines with the recommednation.
The entity would have a "clearly defined public media mandate and purpose with the functions of a globally recognised public media entity," RNZ said.
It would provide public media services across a variety of platforms, some of which may be advertising-free."
Faafoi told reporters at Parliament that the Government's advisory group was focusing on public broadcasting because those were the publicly owned assets.
"They are not necessarily set up to deal with some of the issues that all media companies are facing at the moment.
"I think we've all seen the funding for journalism is an issue right across the board."
It was public knowledge that TVNZ had issues with its revenue.
"If you look at what's happening to the general media market,there are issues there with sustainability which is why we are looking at what we can do to support public broadcasting."