The problem with news in New Zealand
Published 15 August 2019, Newshub
Two weeks ago it came out that TVNZ wasn't paying a dividend to the Government this year and for "the foreseeable future". So they are not a commercial entity in the normal sense and neither are they are a public broadcaster. They inherited their infrastructure and audience from a public broadcaster and pretended for a few years to be a commercial enterprise. But when the going got tough, instead of shrinking, they were allowed to act in a non-commercial way. While their revenue stalls, they are increasing their costs. They are still selling advertising in a putatively open market and commanding a higher rate than their competitors. Next year on their own forecast, TVNZ will lose $17m. And while they are losing this money, they will be taking a disproportionate amount of Government funding from New Zealand On Air. In terms of local content quotas or adherence to a charter, they are sweet as. They have no quotas and no charter. They can do whatever they like to not make a buck. They will never fold, because they are 100 percent state-owned. Being one of their competitors, I'm angry about this. I'm angry that the market for television advertising in New Zealand is distorted by this bizarre, anti-competitive set up. I'm angry that my newsroom, Newshub, is part of a business struggling to keep its head above such polluted waters. I'll be damned if I lay off one more person or say "no" to one more important assignment without expressing it: TV in New Zealand is broken. And it could have a big impact on news in this country.
But the truth is that while TVNZ is a problem, it's not the biggest problem. If it were as simple as a quasi-Government broadcaster with no commercial imperative and a dominant market position, we could solve it. It's even possible the government has recognised the issue and is slowly getting around to it. Maybe we'll have a proposal to merge TVNZ, Maori TV and RNZ. A good idea that will probably end in a morass of working groups.
But it's bigger than that. Look at news across the board. It's said to be a good thing that Stuff can't find a buyer, because that means Nine has had to hang on to their accidental Kiwi purchase. Nine is a media company, right? If this gives anyone any relief, they are deluding themselves. The first and key part of the story is that no one in the world wants to buy New Zealand’s premiere digital news company. That isn't a good thing. Don't think NZME are off the hook. No one reports on their regular staff culls because there's no one there to pull a Herald on the Herald. These guys are enthusiastic chroniclers of every other media company's woes but are naturally silent when it comes to their own inch-by-inch subsidence. They are closing papers. They are up to their necks in trouble. I take no consolation in any of it. The market can't support the newsrooms we have right now, and already we are probably failing to cover what we need to cover. It's anyone's guess what percentage of important court cases aren't reported on. We don't account for what we don't know. The root cause is as simple as it is profound. All our businesses rest on human behaviour, and that behaviour has changed. People don't do what they used to do. Most news media businesses have been able to deal with that behavioural change by reaching audiences on different platforms: web, app, video-on-demand. But when they get there they find that the value they can extract from the same audience has declined by an order of magnitude. The market of attention is flooded while the competition for attention is furious. It’s a diabolical equation.
I've been talking to my colleagues about news. Most agree that this is a good old-fashioned market failure. The thing that we need, that society needs, is not only under threat, it's not being provided right now. The small public broadcasting news operations and the commercial players can no longer provide enough news to keep our society healthy at a local and national level. Unfortunately all the cliches about the free press and democracy are right: we need news to keep this lemon on the road. When markets fail, governments must step in, and this doesn't necessarily have to result in the Kremlin-controlled Pravda newspaper. Many see a publicly funded model as unrealistic, but we already have an example of an independent, publicly funded operation essential to the functioning of society: the judiciary. It is time to start taking the term 'the fourth estate' literally, and to find a new model for surfacing everyday truths. The Government must act now.
Hal Crawford is the Chief News Officer at Newshub.