Broadcasting merger – why and what will it mean?

Barrie Saunders comments on the government’s proposals for restructuring public broadcasting (based on what we have been told so far) …

TVNZ and RNZ are to be merged but absent is a credible rationale or even the end point.   All that is being left to the yet to be appointed establishment board.

First, a bouquet to those journalists who have analysed the announcement and pointed out the information gaps.   Pretty amazing when you think this is all about communication entities.

In summary, what we know is they will come under one company umbrella, the budget for which has yet to be announced.  And yes, it will have a charter full of worthy objectives and will be required to cater better for minorities.

What will happen over the next year?

• Massive lobbying by many to be on the new board, including current members of the RNZ and TVNZ boards.
• Massive lobbying from the supporters of “public broadcasting”, some of whom are dismayed at the thought the commercial TVNZ culture will permeate their beloved RNZ.
• Massive time spent inside parts of RNZ and TVNZ as staff lobby for key roles and speculate on what may happen.  A general loss of productivity.
• Current CEOs of TVNZ and RNZ, Simon Power and Paul Thompson respectively, expected to be preoccupied with the merger and how they might head it, all at the expense of their day jobs.
• Other media heads, including Discovery, to engage in the process to ensure they are advantaged or at least not disadvantaged.
• Lots of media speculation about what’s going on.
• General public confusion.

There were two logical ways the government could have gone  It  chose neither.

The first was to refine the existing model which I have argued for in an earlier post. (“TVNZ-RNZ merger another broadcasting train wreck?” February 13, 2020.)

First, change the Broadcasting Act 1989 by adding TVNZ to RNZ, which is funded directly by NZ On Air, subject to broad parameters about programming.  In addition, take TVNZ out of the contestable funding for other media.  TVNZ to continue running advertising on all channels and On Demand.

Done well, this would likely require some more funding, generously $50 million.  It would have stabilised TVNZ’s funding base and allowed it to further develop its successful TVNZ on Demand.  The great advantage would have been zero disruption and greater policy stability for all media, with a modest extra cost to the taxpayer.

The second (and much more radical) option would be to create a zero advertising integrated video and radio entity along the lines of the ABC in Australia, for which I once worked.   That would require something in the vicinity of $350 million a year.

By failing to address the inherent contradictions in its proposals, the government has passed the buck to the establishment board, and we won’t know until the May budget how much money it will get.

The problem with all mergers, whether they be in the private or public sectors, is that the benefits are typically overstated and the transitional disruption and costs underestimated. They should be avoided, if at all possible, which is the case with TVNZ and RNZ.

Apart from moving to FM from AM, radio in NZ, in the last few years has been stable.   Commercial radio revenues have held up better than most media.  RNZ, like other public radio, has expanded its reach with podcasts.

Commercial TV, on the other hand, has been assaulted on many fronts including the digital media, the online operations like Netflix and YouTube.   There is a traditional audience for linear TV but it is slowly dying off.  There is massive audience fragmentation and many young people do not watch TV at all.

Some commentators, mostly of my vintage, still think about TV channels and forget that content is King, and channels like online are just delivery mechanisms.  The future is online but linear has a while to run yet.  This means talk of selling – say – TV One or Two is rather absurd.  Those channels, plus Duke and TVNZ on Demand, are an integrated operation.  Taking some out will reduce organisation coherence and the whole value proposition to advertisers.

One key issue is whether this hybrid entity will have an integrated newsroom.   RNZ CEO Paul Thompson sees this as likely.  The old NZBC, for which I once worked, did have an integrated newsroom but with not everyone working on TV.  In those days TV was commercial four days a week and non-commercial the other three, while the NZBC included commercial and non-commercial radio.  Will that come back?

If there is to be newsroom integration, why does the Government not worry about a reduction in media plurality – the very issue that stymied the merger between the NZ Herald and Stuff, by the Commerce Commission.  Rather curious for the Government to mandate something the Commerce Commission might not approve.

Finally, I wonder what is public service media in the 2020s.  Given the distaste the literati and other elites have for audience-maximising media, can we expect the new entity will continue to meet their expectations, instead of the masses who may prefer reality TV and other popular programmes including shallow current affairs programmes, instead of news, worthy current affairs, documentaries and drama?

Then there is the issue of minorities.  We have Maori TV, Asian TV, ethnic radio stations, and other media catering for minorities.  Will they be drawn to the new entity running specialist programmes of interest to them, or will they access it on demand?  Would it not be better for NZ On Air or Mangai Paho, to increase their fund instead of expecting the new monolith to deliver for them?

I am all for minorities been taken care of, but should not that include economic rationalists and strong supporters of democracy, who don’t seem to get a look in on RNZ?  I find RNZ is rather mono-cultural, unlike the BBC’s Radio 4.

The next couple of years will be interesting and challenging for RNZ and TVNZ staff but I fear the diversion of the merger will not enhance delivery to their audiences.

• Barrie Saunders first posted this on his own blog HERE.  A retired government relations consultant, Barrie was a journalist for seven years (a very long time ago) and a director of TVNZ, 2011-2017.