Two years after the idea was first floated, confirmation comes that two state-owned media entities will become one. Beyond that most questions remain tantalisingly open, writes Duncan Greive.
After multiple business cases and rounds of consultancy, communications minister Kris Faafoi has today announced that RNZ and TVNZ will be merged, creating a new entity that will attempt to move past the organisations’ origins in radio and television to meet the vastly different challenges of the digital media environment. The biggest reveals in the announcement, both long rumoured, are the return of a charter to TVNZ, scrapped by the previous National government, and the new entity’s not-for-profit status – a major change from the current system, which sees TVNZ aiming to return a dividend to the Crown.
While the confirmation itself is new, beyond that there is little concrete in the announcement. A press release attributed to Faafoi said it will continue to operate all existing media channels, including TVNZ 1, TVNZ OnDemand, RNZ National and RNZ Concert, under their current formats. It also acknowledged that despite digital progress, radio and linear television remain the dominant cultures in their respective organisations, and that the legislation underpinning them would be updated to reflect the modern environment. Faafoi asked us to imagine “a new organisation by the middle of next year, built on the best of RNZ and TVNZ, to future-proof public media for New Zealanders for decades to come”.
It will start from an imposing position, with an annual revenue baseline of almost $400m – making it significantly larger than any other New Zealand media business this side of Sky – but the announcement makes reference to this year’s budget, which presumably will provide still more funding for the expanded ambitions and scope. The release says the new entity will:
- Provide quality public media content to all New Zealanders, including groups who are currently under-served or under-represented
- Use a range of platforms, including current radio and linear TV and those of third parties, to reach audiences when, where and how audiences choose
- Operate under a charter, set out in legislation, and provide trustworthy news as a core service
- Deliver on the Crown’s Te Tiriti obligations and provide Māori stories and perspectives
- Carry advertising, while ensuring services which are currently commercial-free will remain so
- Collaborate with and support the wider New Zealand media sector where appropriate.
It’s worth underlining what this entity seeks to do, before assessing its chance of success across a few different vectors. Media is an enormously broad term, encompassing everything from Facebook posts to TV commercials to journalism and TV drama. The mission of this new entity will likely be fairly close to that of NZ On Air, which says it “connects and reflects our nation. We ensure New Zealanders can experience public media that is authentically New Zealand.”
How will it navigate this challenging new world? These are the key challenges.
The aim is to recapture young audiences. Is this even possible?
The best and most honest data we have about media consumption in Aotearoa comes from NZ On Air’s “Where are the audiences?” survey, which runs annually and tries to capture behaviour across demographics and media types. What it shows is a group of people aged 55+ who are much more likely to consume media the way they have their whole lives – listen to RNZ, watch TVNZ, read the newspaper. Then there is everyone else. The chart below shows the scale of the challenge awaiting the new entity.
In a borderless world for media consumption, the internet’s defining characteristic is an abundance of choice, and a very rapid acceleration in younger people’s exercising of that right. UK data shows that subscription on-demand services like Netflix have rocketed from a distant third to dominate viewing for 16- to 34-year-olds, while linear television has completed this transition in reverse. All this happened in just four years.
Ad-supported streaming is far less popular, everywhere apart from YouTube. Between the fast-moving chaos of social media and the scale of investment of the global streamers, any digital streaming service is going to have to fight very hard to become a channel of consequence for the younger viewers this entity is desperately seeking.
The big shift in media has been decentralisation
We are only a week removed from the ugliness of the occupation at parliament, a scene of mass information disorder that viscerally demonstrated to many of us just how pressing the need is for serious reform of our communications sphere. This is surely why the opening line of this announcement referenced the need for New Zealanders to “continue to have access to reliable, trusted, independent information”.
But while the occupation represented the bleeding edge of a population choosing its own reality, the new entity’s biggest challenge will be that everyone does a version of that now. TVNZ and RNZ were products of the monoculture, an era for communications during which the ability to reach a mass audience was licensed and highly regulated. Now everyone has their own media ecosystem, an unruly tangle of social media, podcasts, live streaming and chat apps that will be competing with the new entity for attention. While it makes reference to a range of platforms and reaching audiences where they are, we live in an era of eroded trust, with individual creators far more able to grow and maintain an audience on social platforms than institutions and larger media entities. How will a new megabrand navigate that? We don’t yet know.
Where will the ads run, and where won’t they?
One of the big inequities of current public media is that the commercial imperative – both literal commercials, and the necessity to reach a broad and viable audience, applies to TVNZ and not RNZ. During the monoculture keeping a single station ad-free and adherent to a charter made a kind of sense, but the logic of having one part of this public media entity be ad-free while the remainder is ad-supported is pure political expediency.
I asked a spokesperson for Faafoi whether the digital part of the new entity would be ad-free, per RNZ’s site, or ad-supported, per all TVNZ’s products. He said such decisions would be up to the board and management of the new entity. It’s a crucial decision – advertising online is, for the most part, highly intrusive and if it adopts the kind of heavy ad load and pre-roll/auto-play common to big media entities like Stuff and the Herald, it will provide a very different and manifestly worse product for the younger online audience than its older legacy-radio counterpart.
How will it impact the private sector?
While he was president in the 60s, Lyndon Johnson’s wife Ladybird owned KTBC, a radio station in Austin, Texas, which curiously received a huge influx of major national advertisers during his term. Which is to say that while there is a repeated stress of independence regarding this entity, there is a certain gravity which exists around the ownership of media. Additionally, government departments are ever-larger participants in ad markets – the enormous, industry-bending $87m Covid-19 campaign has been omnipresent on TVNZ, for example, while spending almost nothing on smaller sites like ours and Newsroom.
I asked NZME CEO Michael Boggs, rangatira of the Herald and half of our radio stations, what he thought of the move, and he expressed apprehension. "NZME does have initial concerns about the effect the merger could have on New Zealand’s media landscape. Additional government investment into this new entity can only add to the intense competition and cost pressures that already exist across New Zealand’s commercial media," he said.
"With TVNZ seemingly no longer required to pay a dividend to government, this frees up millions for reinvestment into expanding the new entity’s digital platforms, commercial capabilities and journalistic talent pool – further increasing audience and competition for advertising revenues."
While there is an expressed desire for the new entity to “collaborate with and support” the private sector, there is a very real danger that it ends up eroding the already perilous base of the private media sector.
What does it mean for NZ On Air?
New Zealand is something of a global oddity in not having a non-commercial public media broadcaster. It chose a different path in 1989, when NZ On Air was set up as a kind of decentralised public broadcaster. Instead of having one institution that controlled its own commissioning budget, we created one that could fund public interest media products for a range of different platforms (this is largely what funds The Spinoff’s video content, for example).
NZ On Air is still nominally in charge of the funding of RNZ, but how it would interact with a new entity of this scale remains to be seen. There is a world wherein its scope is expanded and it funds far more through this new entity. There’s also an argument to be made that the new entity should have its own commissioning budget, comprised of what currently flows through NZ On Air to both RNZ and TVNZ and more. Decisions made at this intersection will have profound implications for the whole media industry here.
Which organisation will dominate the culture?
This is perhaps the most important question of all. The commercial culture of TVNZ has long irritated organisations like Better Public Media, which have campaigned for a fully funded and non-commercial state media entity. At the same time, TVNZ has very consciously evolved its presentation and programming in recent years to really emphasise local in its identity, along with returning to sport in a big way.
Meanwhile RNZ has kept a very stable lineup of presenters and programmes (its audience does not respond at all well to change). Will the pacier commercial approach of TVNZ overwhelm the non-commercial, public service orientation of RNZ? Or the revived charter create a less commercially focused TVNZ?
One big tell might be which brand ends up chosen to own the online space. Both are likely too valuable to be jettisoned in favour of a “third brand”, but maintaining both would seem to defeat the purpose of the merger in the first place. TVNZ has a vastly bigger footprint and reaches more people, but RNZ’s audience is perhaps the country’s most passionate and committed and would not give it up, even online, without a fight. And as the debacle around replacing Concert FM showed, they tend to win.
This cultural showdown is one of a great many tantalising questions begged by today’s announcement, which is both a long time coming and still maddeningly light on detail. Perhaps most instructive of all will be who is chosen to make those big calls. The next big reveal will be May’s budget, which will show just how committed Labour is to this project – and how vulnerable it will be to cuts when a new government comes in.
Follow Duncan Greive’s NZ media podcast The Fold on Apple Podcasts, Spotify or your favourite podcast provider.