Today FM turned off - and erased

Why did MediaWorks kill a network launched with heavy hype only a year ago - which was also the source of news for half the country's commercial stations? The major media company also scrubbed the station’s digital content and brought to an end more than 30 years of talk radio history. Mediawatch asks why - and what happens next.

“Media crises and closures don't come more brutal,” said Tim Murphy, the co-editor of Newsroom who has a wealth of media executive experience.  

Employees of what was New Zealand’s pre-eminent publisher of magazines, Bauer Media, might think the way the German owners killed their New Zealand company with no warning was more cut-throat.  

Magazines in print for decades were shut “with immediate effect” before staff could even clear their desks in 2020. They also had no chance to farewell loyal readers. 

But once word of an ominous all-staff meeting at Today FM got out last Thursday morning, presenters took the opportunity to tell the audience all about it - and vent their own righteous anger after the outcome. 

The extraordinary live on-air revolt began in the closing minutes of the breakfast show Tova. It continued until after stand-in CEO of MediaWorks Wendy Palmer had confirmed a ‘proposal’ from the company’s board to shut Today FM to save money.

"They've f***** us," Tova O'Brien told listeners, explaining they had been assured the network had a five-year plan. 

“We’ve been betrayed,” said co-host Duncan Garner, whose own morning show disintegrated as staff joined them in the studio to air their grievances. 

Staff were told they would have until that afternoon to try and talk them out of it, but those who spoke to media soon after clearly didn’t think that was a ‘good faith’ offer.

On the air, Duncan Garner declared MediaWorks was “bleeding cash” and O’Brien - who had to fight a legal battle against a former employer to join MediaWorks - said they had been “scapegoated” by insiders  “against us from day one.”

The original management plan to pull the plug on regular programmes at lunchtime was brought forward.

Silenced - then erased 

‘We’ve been told to play music,” Garner told listeners, fading out into a mostly-classic hits playlist which included Hang On, Help Is On Its Way and Slip Sliding Away. 

“Clearly emotions were running high on Thursday. Some of the Today FM team broke the news on air . . . before staff had been told and had the chance to digest the news,” MediaWorks interim CEO Wendy Palmer said in a statement to Mediawatch on Saturday. 

“This was disappointing and certainly not what was planned,” she added.

Clearly.

In the hours that followed, Today FM’s original online content - including painstakingly-produced podcasts and mini-documentaries - vanished from its website. 

The fruits of Tova O’Brien and videographer Simon Morrow’s much-hyped trip to Ukraine - funded with $50,000 from the Public Interest Journalism Fund - has also gone. 

All traces of the Today FM brand have also been wiped from all digital platforms including MediaWorks’ own audio app Rova. 

(The online archives of The Listener, Metro and North & South also vanished when Bauer Media closed the titles down in 2020)  

“To lose that and just to have it taken down and disappear is so disappointing. That's what Today FM was doing well for an audience that was multi-platform,” Matt Mollgaard, the head of AUT's Screen, Audio and Journalism department told Mediawatch.  

Just six days earlier, Tova O’Brien was celebrating the first birthday of Today FM on air with cake and candles. 

In late January, the company told Stuff Today FM was “performing in line with its commercial business plan”.

“It’s important for a network radio business to have an effective competitor in the talk segment and one that is an attractive proposition for advertisers and audiences,” they added.

And in that guerilla broadcast on Thursday, Tova O’Brien told listeners that MediaWorks management had said the same to them. 

“We came into this organisation with his promise of a long-term strategy. They had our back for a year from the CEO, to the executive to the board, this is what we were told,” Tova O’Brien said in that guerilla broadcast on Thursday morning.

“But we haven't been able to get the same level of assurance from the board or our acting CEO about the future of Today FM,” she said.

So what went wrong?

Today FM replaced MediaWorks reputationally-challenged station Magic Talk in early 2022  promising ‘News that moves us forward.’

It appointed Dallas Gurney - a former general manager of Newstalk ZB - as director of news and talk the previous September.

He had a further challenge - building a new news service after the Newshub operation was sold to competitor Discovery earlier that year. 

A reported $6m - $9m was invested in launching Today FM and Dallas Gurney told Mediawatch last year that MediaWorks was in this for the long haul. 

The chief executive who hired him, Cam Wallace, also insisted he was committed to news and talk radio even after commercially-crucial audience surveys showed it hadn’t attracted more listeners. 

After announcing big cost-cutting job losses in January, Wallace then resigned to take up a job in Australia last month. Dallas Gurney also decided he was going too, though that was announced later. 

Their departures left Today FM without allies - and with enemies in the company. 

“It was no secret there were factions within MediaWorks upset about the money and resources,” NZME’s Shayne Currie reported this week. 

Back in January, an unnamed MediaWorks source told Stuff's Tom Pullar-Strecker  it was "a vanity project" that wasn't paying its way, and questioned why it hadn't been affected by the drive for cost savings. 

What the owners want

It turned out the board were asking similar questions on behalf of the owners, including the biggest one - California-based ‘vulture’ fund Oaktree Capital - and Australia’s Quadrant Private Equity which has a 40 per cent holding. 

“Earlier this month, Quadrant’s hitmen walked through the front door of MediaWorks with a shiny-suited swagger that suggested they were here for a short time, not a long time,” TodayFM’s early morning host Rachel Smalley said in an NBR column this weekend.   

“The cost of Today FM . . . will be saved giving the company’s bottom line a serious boost. And that is what the owners want to see,” said Newsroom co-editor Mark Jennings, who worked under Oaktree’s ownership at MediaWorks as the company’s head of news.  

But the decisive call to kill Today FM was kept from the key staff right up until that staff announcement on Thursday. 

Why pull the plug now?

According to reports of that meeting, Palmer told staff Today FM cost around $7.5m a year to run - and  its revenue this year “was likely to between $6m and $6.5m.”

Just last week the Advertising Standards Authority said media advertising in 2022 was a healthy $3.4 billion and radio did okay last year - up to $276 million in ads from $264m in 2021. 

So why pull the plug now after all the investment and effort setting it up? 

“I don't think the fact it was only losing a million dollars compared to its revenue was actually that important. In the end . . . the owners of the company want to sell it. And they don't want on its books a radio station that's losing money,” said AUT's Matt Mollgaard, who’s been in radio for over 30 years as a broadcaster, manager and now a researcher and teacher.   

MediaWorks declined interview requests from MediaWatch this week - and so did former board members and executives of the company. 

“Today FM’s financial results were close to their business case. However, the picture going forward looks quite different across the whole business,” Wendy Palmer told Mediawatch in written responses to questions on Saturday. 

The New Zealand Herald reported Wendy Palmer had told staff the company hit a “significant block in terms of revenue” late last year, falling below last year and 2019 levels. 

In February TVNZ also reported reduced half-year profits and predicted “ a softer domestic advertising market for the rest of the year.”

“Today FM’s audience at 1.4 (percentage of market share) meant revenue wasn't being retained with advertisers starting to drop off. We were confident we could retain around 75 percent of Today FM revenue on our other brands,” Palmer told Mediawatch.

“The decision was made in the best interests of the whole MediaWorks business. The view of the Board was that Today FM wasn’t commercially sustainable,” Palmer said when asked if the patience of Oaktree and Quadrant had run out and they wanted to sell MediaWorks. 

“The focus for MediaWorks moving forward will be on its market leading music radio stations and out-of-home billboard business,” she replied. 

What about the news? 

MediaWorks is one of two companies which each own about half the country’s commercial radio stations. Doesn’t it need a credible news service of its own? 

“We are committed to providing our listeners with a quality news offering and we are working with the news team to explore what that might look like,” Wendy Palmer told Mediawatch in writing. 

“It's obvious that it's no longer worth it for them to have that talk (radio) product and a really good news and current affairs offering including a big newsroom,” AUT’s Matt Mollgaard told Mediawatch. 

“It is a real shame because it isn't actually about the talent or about what they were doing on air and online,” he said. 

“It was just a big cost that was sucking out revenue for them . . . so if they're only music stations, they'll actually save money by not hiring journalists and not having those big costs around newsgathering. One of the things that MediaWorks does really well is target younger audiences (with music),” said Matt Mollgaard.

Radio stations come and go, but MediaWorks - and its corporate forerunners - have broadcast and sustained talk radio for more than 30 years. 

“It was the day the talk died at MediaWorks,” said Newsroom’s Tim Murphy, noting Today FM was a “descendant of the broadcast legend Gordon Dryden's original Radio Manukau-turned-Radio Pacific-turned-RadioLive.”

“It's quite shocking in that sense, because we don't have any competition for Newstalk ZB - and it really does need competition because it keeps everybody honest, including RNZ,” Matt Mollgaard told Mediawatch. 

For The Spinoff, Duncan Grieve pointed out that Today FM invested money and energy in original digital content alongside the radio output. 

The abrupt end of the network was a blow for innovation in our media, he said, and MediaWorks staking its future solely on music radio was retrograde, as well as a risk.  

“I think we're going through another period of rapid change now - and of what companies offer as the audiences change and shrink,” said Mollgaard. 

“Radio listeners are trending older now and part of the challenge for companies like MediaWorks - and anyone targeting young audiences - is: where do you get them? And how do you get them to engage and stay engaged in what you're doing?” said Mollgaard. 

In a 2021, study Dollars and Listeners, Matt Mollgaard showed that radio's share of the ad market over 30 years had remained steady between 10 to 12 percent - and its total revenue had always been above $220m a year. 

“That revenue is shifting to digital platforms and broadcasters are looking at that, and thinking: how do we actually capitalise on those audiences that are flipping around from Tik Tok to Instagram - back to my radio station today?” he said.