Coming together of publishing, radio and digital operations sign of structural shift.

New Zealand Media and Entertainment (NZME.) is merging its Auckland operations, including the Herald and The Radio Network, to become the anchor tenant in a media centre being built at 151 Victoria St West, near TVNZ.

The new building will house a converged media company structure taking in NZME.'s radio, publishing and digital operations, including the daily deal website GrabOne. The shift will start on November 1.

The Radio Network will move from 54 Cook St and the publishing arm from 46 Albert St, close to the where the Herald opened its first Queen St office in 1863.

Companies moving offices are commonplace, but the co-location illustrates a major shift in the structure of NZME. and the wider New Zealand media.

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NZME. is combining its operations into one, in a media market that is uniquely unregulated, with ever-closer ties between leading news sources and across brands.

The new headquarters is being built by property developer Manson TCLM, which bought the existing Herald building in Albert St in November last year. That site is zoned for high-rise development.

The Victoria St building will have a combined Herald/Newstalk ZB newsroom, staff were told yesterday, though each media brand would be kept intact in the seating layout for the open-plan office. The building will also house other radio stations and an iHeart Radio music venue.

NZME. was launched in September after APN New Zealand took full ownership of TRN, which had been 50 per cent owned by US firm Clear Channel Communications.

Early starter

A 13 per cent fall in the Radio New Zealand-commissioned Nielsen radio ratings survey at the end of last year has prompted a slowdown for the state broadcaster. After an apparent push-back by listeners, RNZ now plans to pull back and bed in changes made last year, and shift to a period of more "evolutionary" change.

One exception is a new show planned to run from 5am to 6am on National Radio, as a lead-in to Morning Report.

Radio NZ chief executive Paul Thompson says indications are that there is a good audience in the early hours, which is not being served by commercial radio.

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The Newstalk ZB early show with Rachel Smalley has a 25 per cent market share, while RadioLive's James Coleman has 7.8 per cent.

Thompson says RNZ is looking seriously at the new show but it is still months away. It would be a stand-alone operation, not an extension of Morning Report, he says.

In my opinion, the attraction of matching the commercial sector in the early hours is obvious. But the diversion of resources seems ambitious after the slide in ratings during the latter part of 2014, as well as doubts about whether the Government will this year finally end its seven-year funding freeze.

The survey suggested other shows might benefit from extra resources, before creating a new show.

Measuring digital

Radio NZ makes the point that the Nielsen survey of live radio does not incorporate archive material or other digital content such as its younger-oriented website @thewireless.co.nz.

Last year the number of users on the radionz.co.nz website increased by 53 per cent compared with 2013. Users rose from 2.8 million to 4.3 million. Page views grew 44 per cent last year, from 18 million to 26 million, says RNZ. In the first two months of this year, users and page views are up 48 per cent and 38 per cent respectively on the same period last year.

But the commercial media sector has similar measurement problems. Lindsay Mouat is the chief executive of the Association of New Zealand Advertisers, and says that as the media fragment, and with companies owning various media, some consumers overlap in the surveys.

The big challenge for advertisers, media and agencies is finding a measurement of audiences that relates across media.

Whatever the measurement woes, the good news is that our uniquely unregulated media market has allowed innovative cross-media deals.

US watchdog tightens internet rules

There were widespread cheers in the United States recently as supporters of internet freedom and "net neutrality" celebrated a decision by the Federal Communications Commission.

That decision, in theory, ends a movement towards the development of internet services controlled by ISPs.

For example, the US company Verizon has been charging content suppliers to use its networks, on top of the price already paid by consumers.

The FCC decision was on a split vote and is still open to appeal, and David Cormack, from the user group Internet New Zealand, believes it may be too early for back slapping.

But Internet NZ is reminding Kiwis we are not out of the woods yet.

There is no guarantee that the change in the US, even if it holds, would prevent telcos such as Vodafone or Spark from imposing their own extra charges, says Cormack.

Sources say New Zealand telcos have considered such initiatives in the past, but Cormack says New Zealand has so far been relatively immune, because network providers are distinct from content providers.

That has changed with Spark's subscription video on demand service, Lightbox. Netflix has also formed a relationship with Vodafone.

He says the danger is that any additional charges from telcos could help bigger operators and shut out smaller ones, reducing competition.

The argument is that people pay to access the internet and should not be asked to pay any more.

"It's not a problem here yet," says Cormack.

"We are certainly keeping a watching eye and the minister is also keeping it on her radar."