Photo: 123rf
New Zealand's largest media organisations want more detail and more guarantees of independence from the proposed mega public media entity.
Commercial news and broadcasting outlets speaking to MPs at a select committee hearing today raised concerns about the limited detail over competition and cooperation.
Meanwhile, RNZ and TVNZ - who would be subsumed into the new organisation from next year - have expressed broad support but with caveats.
Threats to commercial sector
Stuff has the largest network of newsrooms across the country, employing about 400 journalists, and its chief executive Sinead Boucher emphasised the threats she believed the new entity would pose to the wider commercial sector.
She said a sustainable commercial media was just as important as public media in maintaining a healthy democracy and a free and independent media system.
"It will create a media giant with substantial market power and a comb of a not-for-profit remit, plus the ability to act commercially or non-commercially, to go into any format or market or after any audiences it chooses is really a chilling prospect for ourselves and the wider media industry.
"To have an injection of government funding into its budgets that would dwarf the rest of the industry's budgets put together really makes it a very serious threat to our viability and to the viability of the rest of the industry."
Stuff chief executive Sinead Boucher Photo: supplied
NZME is another of the largest news organisations in New Zealand, and owns the NZ Herald, some other regional newspapers, and a slew of commercial radio stations including Newstalk ZB.
Editor Shayne Currie said the legislation was being "rushed through with a flawed process and it risks seriously destabilising the already fragile media landscape".
"I think the government in setting up the opportunity has missed the significant distortionary effects that the merger will have on competition and the wider damage that could cause to commercial players such as ours but also others.
He also called for a thorough cost-benefit analysis, saying the business case prepared for the project fell short of the requirements for a regulatory impact statement.
"That legislation needs to ensure that net benefits for New Zealanders are delivered."
Mediaworks owns several commercial radio stations, and chief executive Cam Wallace agreed the legislation would "grossly distort the market" and posed a significant threat to the media landscape.
He urged a thorough cost-benefit analysis including impacts on the commercial market, with oversight from the commerce commission.
"It's our core belief that combining these entities in the way which is proposed is not going to enhance trust and confidence in traditional media and/or generate more investment from private media companies."
Advertising and staffing
Boucher said with advertising revenue going to the tech giants like Google and Facebook in recent decades, the new entity could use its public funding purse to undercut competitors with cheaper rates.
"In the new public media entity - which is heavily subsidised by public funding, which can be not-for-profit and commercial and not-commercial, in any market, any product, any medium that it wishes to be - gives the entity a kind of unfair advantage that doesn't exist with TVNZ on its own now," she said.
She also raised concerns the new entity could do so while overpaying for staffing.
"We're already starting to see some evidence of this in the way that our staff have been approached and poached and offered salaries that are well beyond the market standard now in anticipation of the entity being formed."
Boucher said Stuff employees had in some cases been offered up to 30 percent higher pay by TVNZ and RNZ than they had been receiving, "and what we are paying is very much the market rate not low-paying, so we're already starting to feel the effects of it and the entity is not even formed".
Independence
TVNZ's chief executive Simon Power - a former National Party Cabinet minister - said the organisation was "fully supportive" of the initiative.
"If we are to give Kiwis the stories that they want in the manner that they want them then an entity formed between two of the most experienced and trusted news and current affairs and storytelling organisations is the way to do it."
However, he emphasised that independence and trust must be central to the organisation - a point many of the other submitters were also keen to emphasise.
Power said the bill currently fell short on that, partly because the Autonomous Crown Entity (ACE) model would, he said, offer less independence than the Crown Company model TVNZ and RNZ operate under.
"An Autonomous Crown Entity allows for ministerial direction. A Crown entity Company does not allow for ministerial direction. If public media independence is the core idea of the new entity then why would we want to blur that perception?," Power said.
"The perception ... is just as important as the substance, of a minister being able to give direction. Media organisations are different to other crown entities because access to media is a very critical part of the political toolbox.
He said they were not specifically concerned about the current government, or the next one, but the legislation must be robust enough to withstand different governments over time.
"That's why we're also uncomfortable to see editorial independence simply appear in a list among other values in the bill. It should have its own primary clause placed symbolically at the front of the bill sitting behind only the clause on Treaty relationships."
Broadcasting Minister Willie Jackson has previously said he was open to discussing a different model if it would increase the independence of the new entity.
RNZ's submitters - chief executive Paul Thompson and board member Jane Wrightson - also broadly supported the aims of the bill, and had similar concerns about independence.
Former Chief Censor and current Retirement Commissioner Jane Wrightson, who has also led NZ On Air, and the Screen Production and Development Association. Photo:
Wrightson has headed organisations under both an ACE and ICE (Independent Crown Entity) model, and said while an ICE may offer more independence, a Crown Company model would have problems with competing objectives.
"RNZ firmly believes that a Crown Entity is the right structure, the type of Crown Entity could be discussed further but a Crown Company model is not the right answer," she said.
Thompson argued that while the form of the entity was important, ensuring editorial freedom through specific clauses in the legislation should be a higher priority.
Funding and culture concerns
Thompson and Wrightson also called for the entity's funding to be protected with a five-year funding cycle rather than three years, with Thompson saying increased funding would be important for delivering more content to a wider range of New Zealanders under the organisation's charter.
They highlighted RNZ's status as the most trusted news and entertainment service in New Zealand, but also framed the current models both were operating under as unsustainable.
"The mandates and scope of both RNZ and TVNZ are now no longer sufficient or future focused enough to ensure their viability and effectiveness," Thompson said.
Photo: RNZ / Dom Thomas
The merging of the two entities will naturally mean a change in culture. Jackson recently spoke about RNZ's culture being more closely aligned with what the government was hoping to achieve, saying TVNZ would require more cultural change.
Power said it was not about adopting the culture of one organisation over another, but bringing both together to create a new culture that would make the best of both worlds.
He made the point too that although combining the two organisations' news services had taken much of the attention, entertainment for and by New Zealanders would also be part of the new organisation's remit.
RNZ Concert Manager Liisa McMillan also talked about the need for protecting non-commercial public-good production, and for more publicly funded platforms for young people in particular.
The legislation should also be more explicit about support and incubation for the domestic arts and culture sectors, she said.
Cooperation and content creation
The bill includes measures requiring the new organisation to collaborate with and support the commercial sector, but Stuff's Boucher said it needed to be much clearer.
"How it might enhance or support the rest of the media ecosystem is very hard to say. In terms a commercial side it is hard to see how the entity and the commercial media could collaborate commercially without falling foul of the commerce commission."
US media giant Warner Bros-Discovery owns the Three TV channel - which runs Newshub - and other related networks like Bravo. Its senior vice president Glen Kyne said they supported a strong public media mandate but also wanted more clarity over collaboration with the commercial media sector.
"ANZPM must specifically be required to collaborate with other media to share content, space, or resources in a manner that leads to greater sustainability for all."
He said his company's international resources - for instance in creating Japanese and Korean content - could also be shared with the new entity to increase content in foreign languages.
Ensuring its news arm would have complete editorial independence was of utmost importance, he said, and other things also needed to be detailed including governance, and how direct government funding for content would be utilised.
"As it stands there is potential for creating unnecessary market distortions through the lack of clarifying detail or the exploitation of loopholes and vagaries. We believe ANZPM should be formed in the public interest and done so to serve public media goals.
"History tells us what can happen when there is not a clear commitment to purpose, legislation and charter for a state broadcaster and the desired commercial behaviour overtakes those of the public interest."
This would, however, require rigid oversight, he said.
Kyne was also worried about the effect of nearly halving the budget of NZ On Air, saying this would undermine the rest of the sector.
He suggested a portion of the commercial surpluses the new entity makes could be reinvested into a contestable fund the ANZPM could not access.
However, the government has said the sum removed from NZ On Air is made up of estimates of how much funding RNZ and TVNZ currently receive from the NZ On Air. The new entity will be ineligible to receive funding from NZ On Air.
TVNZ's director of content Cate Slater noted about 90 percent of the organisation's non-news media was outsourced, and they expected that would continue.
She said having a viable production sector would be critical to the success of the new entity.
TVNZ's general counsel Brent McAnulty said commercial revenue would also be a really important part of the new entity's future.
"Because every dollar that can be secured commercially for this new entity is a dollar that taxpayers don't have to put in themselves."
