The Covid-19 crisis in media has claimed NZ’s biggest magazine publisher, Bauer Media, but the government says it didn’t seek help through its business assistance initiatives.
Bauer Media NZ is closing its doors permanently and with immediate effect due to the severe economic impact of Covid-19, staff have been told via a Zoom meeting this morning.
CEO Brendon Hill was emotional as he informed staff of publications including The New Zealand Listener, North & South, Metro, Home NZ, Your Home & Garden, NZ Woman’s Day, New Zealand Woman’s Weekly, The Australian Women’s Weekly NZ, Fashion Quarterly and Kia Ora magazine that their jobs were gone.
Late last week, the government ruled that non-daily print media were not permitted to publish through the level four lockdown. In a statement today, Kris Faafoi, minister for broadcasting, communications and digital media, said the company had not sought financial assistance from the government: “I need to make clear that in conversations I’ve had with Bauer recently they indicated that they were not interested in looking at what assistance they might be able to call on from the government’s Covid assistance initiatives and that is entirely their commercial decision.
“I note that Bauer is looking for buyers for its New Zealand assets and I don’t want to interfere in that process,” he continued. “I also note that Bauer had indicated for some time that they were facing challenges around viability of their operations here in New Zealand.
“The media environment was facing serious challenges even before the Covid pandemic, which has only compounded those difficulties and I appreciate that Bauer’s decision today reflects that. Government is looking at the overall state of New Zealand media’s health and sustainability in light of Covid-19.”
At her afternoon media update on the day the news was announced, Jacinda Ardern, the prime minister, rejected the idea that the Covid-19 lockdown was responsible for the company’s closure. “This appears to have been a decision made at the same time as Covid-19, not because of it,” she said.
“The wage subsidy could have made a difference to those writers, to those journalists, and we were very keen that Bauer take it up. We would have liked Bauer to keep their doors open, keep operating, keep an online offering and move through the other side of Covid-19 once we’re all able to,” she said.
“Within a couple of days of the New Zealand government announcing the lockdown, Bauer contacted the minister and told him they weren’t interested in subsidies,” Ardern continued. “They didn’t enter a conversation about becoming an essential service, they didn’t seek to continue to operate in lockdown and they didn’t want to use the government support to keep their doors open, so I reject any suggestion that Covid-19 and our response to it has caused them to shut their printing press but I deeply regret that they have. In my view, they should have taken it up and they should have kept going.”
In a media release, Bauer CEO Hill said: “This is a devastating blow for our committed and talented team who have worked tirelessly to inform and entertain New Zealanders, through some of the country’s best-loved and most-read magazines.
“We understand the New Zealand government’s decision to move to Covid-19 level four, but it has put our business in an untenable position. Publishing in New Zealand is very dependent on advertising revenue and it is highly unlikely that demand will ever return to pre-crisis levels.”
The release says that in response to the situation, Bauer carried out an urgent review of its New Zealand operations and “considered all options to keep part or all of the business open, including engaging with the New Zealand government”.
Hill said an “active search” was under way to find buyers for Bauer’s titles, but “so far, an alternative owner has not been found”.
In an emailed response to questions from The Spinoff about the decision to close, a Bauer Media Group spokesperson said, “Magazine publishing in New Zealand has been challenged by decreasing readership and advertising demand for some time. The decision, however, became inevitable after the understandable ban on magazine publishing due to the level four Covid-19 restrictions. This hits our business directly and as it is highly unlikely that demands will return to pre-crisis levels, our business will become permanently unsustainable.
“The final decision was made in recent days after urgent review of our New Zealand operations and a search for a new owner was carried out. As part of these efforts over the last few days we have constructively engaged with the government at a ministerial level on the situation that the business is in and potential pathways forward.”
The NZ Listener has been published since 1939, the Woman’s Weekly since 1932.
All 237 staff will be paid their full redundancy and leave entitlements, said the release.
“Thank you, New Zealand, on behalf of my wonderful team, for the joy and privilege of producing a magazine that for 80 years has been at the heart of our nation’s rich, warm and creative culture,” said Pamela Stirling, editor of the Listener, in a tweet. “We feel for all New Zealanders facing similar shocks. Arohanui.”
A family-owned German business, Bauer Media boasts more than 600 magazines worldwide, with an annual turnover of about NZ $4 billion. It is believed it had been seeking to sell some or all of its New Zealand titles for some time. It’s understood staff were told that Bauer NZ put a case to the government to be classed “essential” and therefore be allowed to remain publishing on Monday, March 30, but the decision to close was made by the global owner.
Asked about the media crisis yesterday, the finance minister, Grant Robertson, said: “The media is an area that sits within a broader set of recovery packages that we are going to be working on over the medium term.”
He added: “Clearly this is a hugely challenging period for the media sector which was already under pressure before we got into this situation so we will work our way through what that might look like.”
In his email to Bauer NZ staff, viewed by The Spinoff, Hill wrote: “It is with great sadness that, due to the severe economic fallout of the Covid-19 crisis, Bauer Media has had to make the very difficult decision to discontinue its publishing business in New Zealand and intends to close all its operations in the country.
“The decision affects all staff and is effective as of today, 2nd of April.
The email, which contains broadly the same details as those shared over the Zoom call, continued: “As you will know magazine publishing in New Zealand is suspended as part of the government’s decision to move to the Covid-19 Level 4 restrictions. Bauer understands the decision to move to Covid-19 Level 4, but it has put our business in an untenable position.
“In response we have carried out an urgent review of our New Zealand operations and considered all options to keep part or all the business open, including engaging with the New Zealand government. However, no alternative owner has been found.
“I realise this news will come as a big shock to you and to your families, and you will have many questions about what this means to you. We will shortly be in contact with you by email to provide more details about the next steps… I want to reassure you we are doing everything we can to provide you with the information and support you need. This includes ensuring that funding will be available to pay full redundancy and leave entitlements.
The email concluded: “This is a sad day for Bauer and most importantly for the talented Bauer New Zealand team who have worked tirelessly to inform and entertain New Zealanders. I want to thank you for your commitment and the huge contribution you have made.”
“The news that Bauer is closing it’s New Zealand business is devastating – not just for me personally but for the industry as a whole,” said Henry Oliver, editor of Metro magazine.
“I’m so proud of the work we’ve done at Metro over the last year and so grateful to have met and worked with so many exceptionally talented people. They all now face an uncertain future in a deeply troubled industry and I hope we don’t lose them for good. As for me, no one wants to be the last editor of a magazine. Despite all evidence pointing otherwise, I find myself still hoping, perhaps naively, I’m not.”
In an email to her team, seen by The Spinoff, Woman’s Day editor Sido Kitchin wrote: “I’m so sorry. This is a devastating day for each and every one of you who have put your heart and soul into the jobs you love. I couldn’t have asked for a more wonderful team than you guys – and I’m heartbroken. It’s been an absolute privilege to work with you and I can’t thank you enough for your passion and dedication until this fateful day.
She added: “The enormity of today’s announcement will take some time to process and no doubt you are all in shock right now – made even harder by the fact we are all separated. Please reach out to each other. I will keep in touch.
Much love to you all.”
The closure of the magazines represented “a serious blow to New Zealand journalism and culture”, the former prime minster, Helen Clark, told The Spinoff.
“I am a long time reader of The Listener, which has a venerable history, and for which one hopes there might be a committed New Zealand buyer,” she said.
“When our print media is in the hands of offshore conglomerates, there is scant consideration, if any, given to the impact of such a closure on the culture and journalism of a small country on the periphery. Indeed, the current crisis may well have presented the company with an excuse it was looking for to quit the New Zealand market. Closing its New Zealand stable down one week into a lockdown suggests there was no deep commitment to it. One wonders whether its consideration of all options, as it asserts that it has undertaken, included more innovative business models.”
She added: “I formed the strong opinion during my time as minister of arts, culture and heritage that if we New Zealanders did not invest in our own cultural expression, we would suffer immeasurable loss. It may be that New Zealand now needs to consider an equivalent to or expansion of New Zealand on Air in order to support quality print journalism and media from New Zealand perspectives. That would not be easy to design, and no doubt the usual derision from the pure market forces lobby would respond, but without such a move New Zealand will struggle to be a supplier of news, opinion and other original media.
“The relatively recent online platforms like Newsroom NZ and The Spinoff are providing an extraordinary service, but one assumes also that their existence is somewhat precarious and made even more so by the current crisis.”
The decision is the biggest and most shocking chapter in a media crisis deepened by the impact of Covid-19. Earlier this week NZME announced the closure of Radio Sport and informed staff that further redundancies were inevitable. Further closures of titles at NZME and elsewhere are expected to be announced in coming days.
The Spinoff Weekly compiles the best stories of the week – an essential guide to modern life in New Zealand, emailed out on Monday evenings.