The TVNZ–RNZ merger – is this another broadcasting train wreck? 

This post by BARRIE SAUNDERS is one of two being published on Point of Order today on the restructuring of state broadcasting and the fate of RNZ’s Concert programme.   

In the 1970s Barrie worked for the NZBC, ABC, UPITN, NBR and the BBC, he  was a director of TVNZ from 2011-2017, and he listens via the internet to the ABC, BBC and other public radio.   

The RNZ Concert programme train wreck is but a prelude to what is likely if the proposed RNZ-TVNZ merger goes ahead.

The Government has asked PWC to flesh out a plan that doesn’t stack up.  But we can be 100% confident that PWC will find the proposed merger is viable when they report to the government in mid-year.   Consultants rarely produce reports that customer don’t like and – unlike the private sector – this one will be taxpayer underwritten.  And we all know what that means.

In a small democracy and economy, I accept there is a case for a publicly owned broadcaster.  But it should exist alongside a thriving private media, which at present is in deep trouble as foreign digital media hoover up most of the digital advertising, without providing any real NZ content.

RNZ is taxpayer-funded directly through NZ On Air, with the Minister setting the amount.  It is thus viable for as long as taxpayers are willing to fund it.

TVNZ is mostly dependent on a shrinking advertising base, but is indirectly funded through the contestable NZ On Air money, provided to producers for programmes shown on TVNZ.   TV3 also has programmes supported by NZ On Air, but is losing money, while Prime is supported by pay TV operator Sky, which itself is struggling.

It is important to remember that – apart from news and current affairs – the future of TV/video is streaming.  TVNZ On Demand is going brilliantly and I note Sky’s streaming is going well also.

People who support public broadcasting should forget about selling, say, TV2 and making TV1 into a so-called public channel.  Its all about content on demand not channel numbers.

There are two viable options for TVNZ – one incremental and the other radical and very expensive.    

Incremental

First, change the Broadcasting Act 1989 to provide for the Minister to direct NZ On Air to bulk fund TVNZ along the lines already done for RNZ.   A one-word (“TVNZ”) addition to section 44 (1A), would allow the Minister to direct NZ On Air to directly fund TVNZ, as it does with RNZ.

There is no need to introduce a Charter for TVNZ because the existing legislation gives NZ On Air sufficient power to influence the usage of its (ie the taxpayers’) money.

Next, remove TVNZ from the contestable funding allocated to other media.

Finally the Government will need to set the quantum of NZ On Air money allocated directly to TVNZ and also the contestable fund.  It’s likely an increase in the current total will be required.

The incremental option is my first preference because it will cause zero disruption to TVNZ, RNZ and private media, and can be done very quickly.

Radical options

Either merge TVNZ and RNZ into one non-commercial taxpayer funded broadcasting operation, or simply make TVNZ non-commercial.

  1. Funding a non-commercial three-channel TVNZ would be extremely expensive (maybe $250 million a year). All programmes would be available on TVNZ On Demand, which is very successful and is the pathway to the future for NZ content.
  2. The private sector might survive if TVNZ is non-commercial, even if all taxpayer funding of private TV/video outlets was ended, the logical consequence of making TVNZ non-commercial.

The Government proposal

The government proposal is for RNZ and TVNZ to be merged and to be funded by tax revenue and commercial sources, but non-commercial RNZ will stay that way.

Under this proposal NZ On Air will continue with a contestable fund for the private sector and be the route through which RNZ would continue to be funded.  TVNZ itself would also be funded through NZ On Air, but it is not clear whether this would be directly or through the contestable fund in competition with the private sector.

This proposal is a potential train wreck and should be abandoned.

  1. The synergies between radio and television operations are much less than many outsiders assume. I have worked for public broadcasters in NZ, Australia and the UK and in all cases staff were substantially employed for either radio or TV, but not both.  Even in news and current affairs this was the case, with operations often several kilometers apart.  Today we have some news and current affairs simulcasts in broadcasting, but I am not aware of this happening with drama or light entertainment.
  2. As noted in the Cabinet paper, the cultures of TVNZ and RNZ are seriously different. Putting them together would be seriously challenging, and – if TVNZ remained substantially commercial – virtually impossible to achieve successfully.  If TV and radio staff were kept in separate compartments the few synergies possible, would not be achieved anyway, so why do it?
  3. Mergers in any industry tend to cost more than anticipated and achieve less. In the case of the public sector the problems are greater because of the processes involved.  Disestablishing TVNZ and RNZ and creating a new “NZBC” would mean hundreds of technical redundancies, IT costs etc, to say nothing of the disruption of doing this over three years as envisaged in the Cabinet paper.
  4. Media diversity would be diminished if RNZ and TVNZ were to be merged. Given the way the private media is struggling the thought of an integrated state media operation dominating the news scene is scary.  It would be a dangerous concentration of power.  Statements that editorial independence (from the government and directors) would be enshrined are good, but wouldn’t stop a committed integrated media operation from running its campaign – say – against or for, a political leader.
  5. Minister Kris Faafoi is seriously naïve in believing the newly merged entity would be nimbler than RNZ and TVNZ. Larger enterprises by nature are less nimble than smaller ones.  I see TV3 as more nimble than TVNZ, because it is smaller and leaner.  It has taken more risks as shown by its success with NZ comedy.

Broadcasting policy should be a cross-party matter with widespread public support.  We will all lose if the media itself becomes an election issue.

My advice to Kris Faafoi:  it’s time to press the reset button.  Learn from the Concert programme disaster.

 

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