The EU’s new privacy laws come into effect this week.
Big changes are coming to how companies that operate in Europe collect data. Dave Parry says failure to adopt practices that safeguard privacy could risk New Zealand’s reputation.
Over the past couple of weeks, you may have noticed that Facebook, Twitter, Gmail and all your other favourite internet sites have had a pop up mentioning new privacy rules. This isn’t a coincidence – they’re getting ready to comply with a new law which will set a precedent for our online privacy.
On Friday, the European Union’s General Data Protection Regulation comes into effect. Its primary target is to protect the privacy of citizens of the EU. But at its core is a requirement that everyone who stores the data of EU citizens complies – that applies to every country around the world.
The changes require consent for information to be given in an easily accessible form using clear and plain language, not legal jargon. Companies must also allow people to have their data deleted – the “right to be forgotten” – and have just three days to notify of a data breach. A particular threat to the likes of Facebook is the right to data portability. This means you can ask for a company to give you all the data it has on you in a digital form so you can shift it to a different social network. The law also requires businesses to have a representative in the EU.
It covers anything that can be used to directly or indirectly identify a person. It can be anything from a name, a photo, an email address, bank details, posts on social networking websites, medical information, or a computer IP address.
If you break the rules, you risk fines of 4% of annual turnover, or 20 million Euro.
Google’s privacy checkup start page, May 2018.
We’ve known about this law coming into force for two years now, but I highly doubt many New Zealand businesses are aware of the extent it will change how they operate. New Zealand’s own Privacy Act was cutting-edge in 1993, but looks distinctly old-fashioned now.
It’s safe to say our big businesses will be compliant. The likes of Fonterra, Air New Zealand and other big trading companies will have had their legal and IT teams on it since the legislation passed in 2016.
But the law applies to every business. That means the bed and breakfast in Te Anau, the Manuka honey retailer in Coromandel, and the cheese maker in Southland. These small businesses, that might only have a handful of employees, probably don’t even collate this information. But now they’ll have to. Essentially, if you have customers in the EU, you must comply, and that’s the catch: how do you know they’re in the EU? You won’t always know, and that’s why the internet giants are changing their laws for everybody.
The other big players that will be affected by the law changes are schools and universities where we have a growing number of international students. I expect this will be one of the areas that won’t be compliant come Friday. A lot of our schools’ IT departments are teachers who do it on the side, or one or two dedicated people. Overhauling how you’ve collected and stored data and information – if in fact, you have – will take longer than a few days.
Most of you reading this will be smart enough to know that we don’t actually have to pay fines from other countries. They can ask our government to pass on the fine, but the reality is our government has better things to do than collect fines for another country. It’s also unlikely that they will come after small Kiwi businesses when they can keep an eye on the likes of Google and Amazon.
But over time, if local companies aren’t complying it’ll start to create a reputation which could hit us hardest. Travellers are often warned by their governments not to travel to countries with active wars or major health crises, and we could see a similar type advisory issued to travellers regarding privacy. For example, the EU might say: “Be warned that if you travel to New Zealand, your privacy can not be guaranteed.” An advisory like that could be devastating for our tourism industry. And that’s why we have to act.
New Zealanders as a whole are pretty relaxed about privacy compared to those in other first world countries. Most people don’t understand just how much intel there is on them based on internet and phone usage, location tracking and CCTV surveillance. While ignorance has been bliss, the world is changing and that requires an attitude shift from us.
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Give it a few months, a year even, and our government will likely follow suit. There’s a review of the Privacy Act going on at the moment and it’s likely we’ll adopt the same rules as the EU. It’ll be done for ease, but the outcome will mean that we all have better control about what people know about us.
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New Zealand’s blue-chip business newspaper is these days chiefly an online operation, and its owner has plans to boost the subscriber base to 100,000. Against a backdrop of social media grenades and staff disquiet, Spinoff business editor Rebecca Stevenson talks to the NBR’s outspoken head honcho Todd Scott.
Todd Scott is a truculent tweeter, taking aim at ad agencies, lobbyists, other media and former columnist Matthew Hooton apparently at will, whenever inspiration strikes. His most recent Twitter salvo saw him cryptically demanding, on the eve of the Budget, an apology from finance minister Grant Robertson.
“Maybe you have forgotten our last interaction, I haven’t. You WERE out of line. I know you’ve been busy, I hope that you one day find time to apologise.”
No one replied.
A year ago, even those inside the New Zealand media bubble would have struggled to name the publisher of the National Business Review. Lately Todd Scott is the first topic covered by journalists on meeting, inevitably in relation to whatever his latest spiky tweet might be.
Scott has been in the public spotlight before – he used to co-host the Lotto results with Hilary Timmins – but when he started tweeting up a storm earlier this year, The Spinoff got in touch to seek an interview. We wanted to talk about his plans for the paper and the site, which is about to undergo a half-million-dollar overhaul, and of course those tweets. He took some persuading, but agreed to sit down in March, and he’s been sending follow-up messages, at a rate of about one a week, ever since.
Whatever his colleagues might think of his online energies, there’s no doubting his ambition. “I’m spending a lot of money,” says Scott. “And you know, it’s a fine line. But I’m so committed to focusing on the mission, and that is to grow that member subscriber base, because with that financial support we can do so much.”
That mission is daunting, to say the least. As of August last year the NBR recorded 5,000 monthly online subscribers. Scott wants to grow that number 20-fold, to 100,000. And it’s a mission Scott has been shouting from the social media rooftops, touting the NBR as the “meeting place for intelligent business”, as the antithesis of the opinion-driven, PR saturated news you might find elsewhere. As he’s done so, media watchers have sometimes been aghast at his approach. Scott, however, could hardly be less cowed. Just yesterday, he posted, on Twitter, a short video championing again his own “raw and real” style, illustrated with a showreel of his own tweets.
Serious, intelligent business journalists, of which NBR has a horde, pride themselves on walking quietly and carrying a big stick. Scott walks loud. He’s a TV and radio guy; a former presenter and award-winning radio advertising salesman. He’s bald with a booming voice; he’s a dad, he’s got a fancy pool at his house in St Heliers, he’s tweeted about giving up drinking and smoking cannabis, he’s on a restricted diet – he is not quiet about anything.
Scott has been with NBR since 2008, where he rose to chief executive in 2010, before buying out its previous owner, the very wealthy businessman Barry Colman, in August 2012. To finance the deal (reportedly worth about $12 million), Scott borrowed from Colman. The debt remains, and last year the former NBR publisher increased pressure by taking additional security over Scott. Earlier this year Scott remortgaged his family home, a decision reportedly linked to his arrangement with Colman.
“I started with a half a million dollar overdraft, and a significant debt to Barry Colman that was all part of a management buyout,” says Scott. “I have halved that debt. And I’m excited about knocking off the rest of it and redirecting the capital funds into more content.”
Scott in NBR’s central Auckland newsroom. (Image: supplied)
Scott kicked off his contentious year with a bruising public stoush with Businessdesk, a former content supplier to the NBR, in January. A sympathetic story about failed hipster restaurant Five Boroughs’ “clean and quick exit” filed by the news service prompted blowback from pissed off (out of pocket) former employees. NBR’s comments were flooded with negative feedback and Scott, staying true to his shock-jock showman DNA, took to both Twitter and his own comments section to trash the story his site published (“one sided and wrong sided”), before contentiously ending the relationship.
Businessdesk’s owner, highly respected journalist Pattrick Smellie, has stayed mostly quiet on the breakup. It was only when Scott tweeted out of the blue on April 22, about the “appalling puff piece”, that Smellie replied. “Of the many thousands of BusinessDesk stories that NBR ran over 6 years, this is only one that I regret us publishing,” he wrote. “You might be gracious enough to acknowledge that I made a trip to Akld to front you personally on this one story.”
NBR owes Businessdesk money; Scott says he’s holding back one month’s payment “and will pay that when they credit the invoice they sent me for April which I have no intention of paying because I canceled the contract in Feb giving one month’s notice”.
Next came the departure of columnist and property magnate Sir Bob Jones in February after he (satirically, he says) called for a Māori Gratitude Day. Scott dubbed it “inappropriate content” and called for an end to opinions masquerading as news, and found time to debut a novel method of communicating new newsroom policy to staff: a public tweet.
Around the same time Scott unleashed a public war on advertising agencies, lambasting the industry and declaring that the NBR would no longer offer agency commissions to “pimply faced teenagers”.
March had barely started when the next columnist sacking came. Scott “fired” influential right wing commentator Matthew Hooton for a scathing column about former National finance minister Steven Joyce, which Joyce claimed was defamatory. Hooton, quickly snapped by the New Zealand Herald, issued a public statement apologising to Joyce. “This article could reasonably be understood to suggest that the Hon Steven Joyce had engaged in unethical, dishonest and/or corrupt behaviour during his tenure as a Minister in the previous National Government,” Hooton’s statement said.
In what has by now become a familiar pattern to Scott-watchers, the publisher threw social media accelerant at the situation.
“You support a contributor @MatthewHootonNZ – rely on their integrity – back them when they plead, demand that NBR not backdown, retract or apologise for vicious takedown of @stevenljoyce then suddenly they don’t have the conviction of their public writing!” he tweeted.
Asked about the altercation, Scott responds with a critique of Hooton’s traffic.
“I’ll tell you an interesting fact about Matthew Hooton,” he says. “His story got clicked on about 60,000 times, but actually only got read 6,000 times by our member subscribers. And we did not get a peep in paid member subscribers that weekend. So what does that tell you?” In the same conversation, however, he reveals “everybody” raised concerns he would lose readers. Some longtime readers had, in fact, cancelled their subs. “If the only reason you pay $35.00 a month to read NBR is to get access to a lobbyist, then I just saved you $35.00. You should be able to read that anywhere for free. Seriously?”
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What does the newsroom, not to mention editor Duncan Bridgeman, make of Scott’s habit of issuing editorial directives – not to mention lunchroom etiquette lessons – via social media? They “take it with a grain of salt”, he says.
“I think that they all understand, and they all agree, that we’re on the same team heading towards the same goal, and the fact of the matter is you can’t sell a secret. So I could share that information internally, and of course I do. But it was about also sharing it with a wider audience. Because as I said, you can’t sell a secret. If we make a decision to do this, and it has this effect, I wanted to share that, and Twitter allows you to do that.”
For NBR the overarching goal is not clicks, but subscribers. Given that, perhaps Scott’s Twitter activity is comparable to a newsagent touting goods. He routinely links his high profile antics to this sentiment during our interview. It’s all part, he says, of a sales pitch to an audience outside of those already reading NBR.
It’s hard to put all of his tweets into this context – some appear more like a personal vendetta. Herald columnist Lizzie Marvelly was the focus of one of Scott’s tweet-storms and complained Scott hounded her. She found a high-profile ally in business leader Sarah Trotman, who says Scott was “pestering” her on Twitter, too.
And beyond the online fireworks, there has been personnel churn, too. Apart from Hooton, Jones and the Businessdesk contributors, media columnist David Cohen has resigned and staff journalist Nick Grant has departed, while there are rumblings of other possible exits, including among accounts staff.
Multiple NBR sources spoken to by The Spinoff draw a parallel between his fiery tweets and his at-work persona. Scott labels himself raw and real but some say that “rawness” has left some staff perplexed and worried. One source called his outbursts “utter hypocrisy” in light of his exhortations that NBR should be measured, non-polemic and scrupulously intelligent.
Others at the business publication see it differently. NBR’s core readers likely aren’t on Twitter, and they’re certainly not breathlessly scanning Scott’s tweets for pontifications on the State of The Media. What matters for the NBR is serving its readers. And it’s a subscriber list swollen with heavyweights: ANZ, ASB, Deloitte, Auckland Council, Westpac and Meredith Connell. MBIE, Bayleys, Spark and Bell Gully. Bureaucrats, banks, telcos, lawyers and professional firms. Blue-chip clients for an old-school (now also online) business mag.
The roster remains very strong. Tim Hunter’s pursuit of collapsed insurer CBL is a classic NBR story, and the kind which former foes at the old Fairfax and NZME business teams find hard to resource. It’s hard to get the wider public enthused unless they can relate to a business story on a personal level. CBL, with its corporate machinations, offshore moves and collapse triggered by intervention from the Reserve Bank doesn’t register for a consumer-focused mainstream media.
Scott highlights journalist Karyn Scherer’s work exposing a scandal at Fuji Xerox (which saw journalists boycott the EY Business Awards after the awards snubbed the stories, as Fuji Xerox was an EY client) as the kind of work only NBR can do.
“I totally understand how important our job is, and it’s not always pretty… I mean, there’s just, there’s not enough of these big corporates being held to account. Firstly, because so many people are dependent on the funding that comes from them, whether that be sponsorship or advertising. And secondly, because they’re concerned with how litigious these people are.”
NBR has stood apart in that it’s long had a paywall (a novelty in the make-it-free-and-hope-it-works New Zealand media scene), and has always seen itself as a premium product; it costs $238 for a six-month print subscription or $475 for a year; an online sub will set you back $35 a month, mobile-only is $20. It has a weekly newsletter for $458 a year, Capital Letter, a bulletin of legislative moves and court decisions.
Scott notes the company’s focus is digital now, though he respects “some people just don’t want to go there”. He says there’s little crossover (about 10%) between print and online readers, so he can’t be cannibalising print sales by pushing online. “It’s staggering,” the NBR publisher says, “you’re looking at 36,000 people a week reading the newspaper, compared to 75,000 a week reading the online. The target is more online subscribers.”
He’s investing $500,000 in website development and a mobile app, with the new site to launch next month. Again, in quintessential Scott fashion he says this “undertaking and investment is the most significant in NBR’s history”. The approach they’re taking is working, he insists. Every week NBR is adding 50 new online members, “which puts us bang on track for 10,000 monthly online member subscribers within two years”.
So all the chaos comes back to singing the NBR gospel, on Twitter and elsewhere, and getting more paying readers online.
“If we can build a following of member subscribers that fund our newsroom, my commitment to the newsroom is I will keep investing that into the newsroom. I don’t have any shareholders, I don’t want any shareholders, and the reason for that is I don’t believe that shareholders would allow me to do what I’m doing.
“We’re at this very point in time undergoing a full, extensive company audit to better understand how we can achieve the objectives that we’ve clearly set out for ourselves, including knocking over the 10,000 paid member subscribers, getting on with the 30,000 monthly paid member subscribers, and being able to achieve 100,000 paid member subscribers. It won’t be doing the same thing that we’re doing now, I’m very sure of that.”
The 10,000 figure is the first goal, but after that NBR in Scott’s eyes broadens into a more diverse media operation.
“I believe at that point we will be the undisputed champions of business news in New Zealand. And when we’ve achieved that, we will broaden. With the likes of science and medicine, NBR, the three letters, NBR, will simply become synonymous with exclusive, intelligent content behind the paywall.”
If you have any information relating to this story that you’d like to share, please email rebecca@thespinoff.co.nz
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