Jacinda Ardern and Ashley Bloomfield. (Photo: Hagen Hopkins/Getty Images)

MediaApril 9, 2020

New Zealanders deserve proper answers to difficult questions on Covid-19

Guest writer

Jacinda Ardern and Ashley Bloomfield. (Photo: Hagen Hopkins/Getty Images)

The 1pm briefing has become appointment viewing. But it is no substitute for transparent, timely information, even in such extraordinary times, writes Newshub investigations reporter Michael Morrah in this post originally published on Newshub.

Like all journalists in New Zealand right now, I’ve been covering stories day after day, all of which relate to our current coronavirus crisis. It’s the longest-running, bulletin dominating story I’ve ever known and is impacting every single Kiwi, young and old.

Given the ongoing significance of this epidemic, we as journalists need swift, precise information. We need this to inform the public. However, getting clear, timely answers to questions has frequently been an arduous and deeply frustrating process.

Early in this crisis, I put a simple question to the Health Ministry’s media team about Personal Protective Equipment. It took four days to get a response, and when I did, the information provided was vague, unhelpful, and did not answer my question. This is simply not good enough.

What’s happening now is that journalists are being referred to Dr Ashley Bloomfield’s daily 1pm press briefings in order to get the answers we need.

This is how these briefings work.

The room is filled with journalists from every media television, radio and print organisation in the country. Each of those journalists in the room has their own questions, plus questions from other colleagues in their organisation (who are chasing different angles) who are not based in Wellington and cannot attend the briefings in person.

The atmosphere is often tense, as journalists try to get their questions out before the officials call time, and it’s all over.

In a normal interview setting, journalists are able to ask a question and then ask a follow-up question. This is important, as it helps provide context. It also means journalists can challenge a position or comment. I fully understand these are not normal circumstances, but the information being provided (if you’re lucky enough to get a response) has been piecemeal at best.

Our Newshub political team, led by the indomitable Tova O’Brien, is doing a phenomenal job challenging officials, and extracting key facts, while fielding multiple text messages and emails from our team of journalists in other parts of the country.

Our job is not to just repeat what is being said at media briefings. But to listen, analyse and test the veracity of what is being said. If we have evidence which conflicts with the government’s version of events, we must have the ability to test this. This is our responsibility as a conduit for the public.

There also appears to be a massive disconnect with what the public is being told, and what is actually happening on the ground.

The call for our country’s most vulnerable to get flu jabs is a good example. On March 18, the Health Minister announced a major flu vaccination campaign to ensure hospital beds are available for a possible influx of Covid-19 patients. The ministry said it had vast stocks of the vaccine – 1.8 million doses to be exact. They would be available to those 65 and over immediately.

Over the coming days, it became apparent that this campaign simply wasn’t working. Why? Because GP clinics did not have enough of the vaccines, and their access to the vaccine had been restricted to just 60 doses per order.

Healthcare Logistics, the group that distributes the flu vaccine, emailed doctors to say their large orders had been cancelled because a company that supplies a brand of the vaccine has “run out of stock”.

When we raised this issue with the director general of health, Dr Ashley Bloomfield, he said we were moving “from a peacetime distribution to a wartime distribution” and the ministry was working on the issue.

The concern I have, however, is that even as I write this today, it’s clear just how far we really are from implementing a “wartime distribution”. I am still getting emails from our country’s elderly asking me why they can’t get a flu shot. Imagine the pressure our country’s doctors are under to explain this to their patients. This is a massive failure due to inadequate planning and contradictory communication.

If the government is really serious about its so-called “wartime distribution”, they need to start acting like it. Commandeer the courier trucks if needed and get the vaccines to where they’re needed. The same goes for swabs. Despite constant assurances that we have thousands, I am speaking to doctors on a daily basis who say they’re struggling to get enough (5 at a time), or have been told by labs their practice cannot get any as there is not enough.

Dr Bloomfield stated on Tuesday we had 50,000 nasal swabs in the country. That’s great, but they are not getting to those who need them. Why not? How can you expect our frontline health heroes to do their jobs effectively if they don’t have the swabs or PPE to do it. And if we do have tens of thousands of nasal swabs, why am I reading two emails from two different Auckland health groups, who represent hundreds of doctors, which tell their members that they need to move to using throat swabs because of supply issues with the nasal variety.

I think Prime Minister Jacinda Ardern has done a solid job of steadying the ship through these uncharted times. But we need transparent, timely information. Not PR spin. This is important not only for journalists, but for all New Zealanders.

Keep going!

NZ Media was already in trouble. Then Covid-19 came along. (image: Toby Morris)

OPINIONBusinessApril 7, 2020

The next Bauer: What is the rescue plan for NZ’s devastated media industry?

Duncan Greive

Founder

NZ Media was already in trouble. Then Covid-19 came along. (image: Toby Morris)

There’s a desperate scramble to stop more major media companies failing. Duncan Greive explains what’s going on – and how it might play out.

The most recent edition of the reigning newspaper of the year, the Sunday Star-Times, was a pearler. It opened with a substantial analysis from political editor Luke Malpass about the tension between the downstream economic impact of an extended lockdown versus the real and present danger of a serious Covid-19 outbreak, the first of a half-dozen strong, focused news features. There was a diverse suite of guest opinion pieces from the likes of Reserve Bank governor Adrian Orr, NZ Initiative chair Roger Partridge, along with MPs Chlöe Swarbrick and Judith Collins, assessing where we’re headed and how our institutions have responded.

The columns from those prominent New Zealanders weren’t just the paper wanting to get strong, well-founded views in front of us. They were also the result of two other big changes at the paper. Firstly, that during the week, it had let go almost all its freelance columnists, meaning space given over to the beloved likes of David Slack was now replaced with the no-cost musings of politicians. Secondly, and this is what’s driving all the change, is that by my count the Sunday Star-Times had just four paid advertisements. One for Vodafone, one for Westpac, one for the government’s Covid-19 messaging and one for the IRD.

Four is, to put it mildly, a catastrophically low number, as befits this catastrophe we’re living through. The Sunday Star-Times is the flagship newspaper of Stuff, New Zealand’s largest employer of journalists, and it bears repeating that for all Stuff’s eye-watering traffic numbers, newspaper advertising remains its most important revenue stream. So even though sources suggest the paper gained hundreds of new subscribers during the week, it didn’t come close to wiping away the pain of booking just a tiny fragment of an ordinary week’s advertising.

This is what is happening to New Zealand’s scale private sector media throughout the industry – stunning drops in advertising revenue, entirely without precedent. And between the length of the lockdown, and the massively depressed economy we’ll emerge into, there is no relief in sight. This is what moved magazine giant Bauer to act with such speed and savagery, in cutting off its New Zealand limb.

The next Bauer

Now all eyes are on the four large media private sector companies that remain – NZME, Stuff, MediaWorks and Sky – wondering which might be the next to fall. And when – it’s not an if – that happens, whether they will be allowed to simply disappear, as Bauer was, or whether there is some method by which the sector might be rescued. Or whether the government will devise a way to allow them to limp along until the some combination of the businesses might be fused together.

The two most likely candidates for a Bauer-style execution are obvious. It’s less about their work, which is mostly excellent, than about their owners, which are offshore and have bigger things to worry about. Just as Bauer’s did. One candidate is Stuff, which in addition to the website owns the largest chain of newspapers in the country, as well as social network Neighbourly and adjacent businesses like Stuff Fibre and Stuff Pix (never let anyone tell you media owners have failed to try to innovate). The other is MediaWorks, which screens Three and until recently Three Life (shut down in March) along with running the Newshub website and dozens of popular radio brands.

Let’s take their immediate peril in turn. Stuff is owned by Nine Media, a giant Australian conglomerate which picked it up when it acquired Stuff’s parent company Fairfax Media a couple of years ago. It has made no secret of its lack of interest in Stuff, and unsuccessfully tried to sell it last year. Its owners are ruthless by reputation, and there is a justified and deep fear that it might decide to simply suck the remaining cash out of Stuff to help support its equally troubled Aussie mothership, leaving it an empty husk of a company. One which would immediately collapse, perhaps unable to even pay out its leave and redundancy obligations to its staff, as Bauer did.

MediaWorks is in a similarly troubled position. The revenue it relies on has declined nearly as badly as print, and it started the race in a worse position, spending much of last year either lobbying for government assistance or preparing its TV business for a now surely-impossible-to-execute sale. MediaWorks is majority owned by Oaktree capital, a US firm which invests in distressed assets, though surely the level of distress MediaWorks is currently in means it no longer qualifies as an asset. It too has been looking for an exit for years, and now Oaktree has air cover to simply cut and run.

An array of unattractive options

What might happen if either were to be cut loose? The government has almost no leverage to pressure the pair’s foreign owners to stick it out and see what’s on the other side. It had all of last year to make a plan for consolidation or financial aid, and communications minister Kris Faafoi spent much of 2019 meeting with the heads of the major media companies, apparently working on a solution. When it came, that solution was a proposal to merge RNZ and TVNZ, with consultancy PWC paid to figure out the how and why. A decision which still makes the private sector executives fume when you raise it with them.

What that means is that there is no sign of any government plan to deal with these looming failures, whose crises have been dramatically accelerated. Thus emergency meetings are being held over Zoom and Skype with various officials to try and figure out a plan (declaration: I am in one of those meetings today, and am publishing ahead of it as a reporter, before attending it as an operator).

The problem is that even temporary solves are fiendishly tricky, with every potential lever the government might pull deeply fraught. Those proposed in the immediate term – diversion of NZ on Air funds, forgoing the Kordia fees broadcasters pay to access the airwaves – are too small to make a difference. Others, like legislation to allow the merger of Stuff and NZME, might no longer be viable in the current financial climate. Even moves the government has made to effectively allow businesses to trade while insolvent are not enough to help these media companies, as they rely on you being able to repay any debts incurred in a year or two, which is magical thinking for the businesses under their current models and shape.

Loans would be difficult, as there would be a very high risk of default. The government could facilitate management buyouts, by assuming some of the risk, but inevitably that would involve mass redundancies as the businesses were re-shaped and -sized, something the government is unlikely to be willing to effectively fund. One option discussed is a giant government ad buy, which it could use itself or distribute to businesses in need of marketing on the other side of lockdown. On one level it’s completely unimaginably crazy. On another, it’s one of the few options touted that at least has a value exchange at its heart.

A new tax targeted at offshore online giants – designed to counteract in some small way the years-long transfer of advertising from traditional media to the likes of Facebook and Google – is favoured by some. But it is hard to see how that can be enacted in the short term, or unless introduced in concert with other OECD governments.

There are other options, but the complexity is manifest. Particularly given that its decisions will be watched so closely by all other industries. Everyone from travel agents to TV production companies is begging for an industry-specific bailout too, and all can make stronger cases for being economically critical infrastructure.

TVNZ as the sector saviour?

The option which feels cleanest is also potentially the most worrying for other sector participants, and those who value a pluralistic ownership of media. There is one commercial media operator out there with a rock solid brand, a smart, strategic executive group and a great balance sheet. Its name is TVNZ, and it is ultimately owned by the government. There are whispers that should there be a failure at Stuff, for example, it might step in as a caretaker owner. The collapse off Bauer was bad enough, but Stuff employs more than four times as many people, and it’s no exaggeration to say that it’s the only thoroughly resourced network of regional and community journalists in the country. Its collapse is unthinkable.

And yet, were TVNZ to arrive as a white knight, there’s every reason to wonder if it might not quite like its new ward. Stuff’s scale audience for online news is one area TVNZ is conspicuously weak, and the two share similar news culture and values. It could slowly dispose of the papers to local owners, while ultimately retaining that jewel of a mass national audience site.

TVNZ CEO Kevin Kenrick has openly talked about his desire for consolidation and scale. This moment presents a clear path to it, and a crisis groaning with reasons to abandon the usual squeamishness about government ownership. He could even suggest that be allayed by a partial listing when the virus clears, allowing the government to remain with a cornerstone stake, as it did with other national infrastructure like the power companies, while allowing for the sunlight of other shareholders. Labour might resist this under normal circumstances, but there is nothing normal about this moment.

The problem is, that once this door is open, it’s difficult to close. The Commerce Commission would never allow TVNZ to buy Three from MediaWorks, but if it were to collapse, TVNZ would likely be free to pick over its assets. Another TV channel, and some radio stations might also be a path to scale.

It would be an extraordinary nationalisation of our major media assets – but again, these are extraordinary times, calling for extraordinary measures. The list of those potentially interested in acquiring the assets of Bauer Media, inadvertently emailed out by receivers EY yesterday, made interesting reading, but don’t hold your breath on a big new player readying to enter the industry. And of the many bad options on the table, the TVNZ-as-rescuer might be the most palatable to both the current government and the wider public.

The biggest barrier might be where it ends. Because the troubles don’t stop at Stuff and MediaWorks, and even in a caretaker role, the government as ultimate owner of other media would have a chilling effect on investment elsewhere. The other two big companies may have local owners through the NZX, but neither are in much better shape. NZME (publisher of the NZ Herald and owner of radio stations like Newstalk ZB) has laid off dozens, and shut down RadioSport without fanfare a week ago. Meanwhile Stuff reported yesterday that Sky TV’s bonds have traded as low as 53 cents in the dollar. Which is to say that the market thinks it’s a coin flip whether it will still be operating when those bonds are due to be repaid in March of next year.

It all underlines just how dysfunctional our media has been for some time, and how desperately it required consolidation prior to this storm arriving. None of this is the government’s doing – or if so, only by neglect rather than commission. But the fevered meetings happening at the moment have this weight hanging over them. Bauer was first and fastest, but that fate likely awaits every one of our large media companies unless something radical is done to save them.