Kris Faafoi, the man in charge of a noisy and distressed sector (Image: Getty Images)

Meet the minister in charge of a media teetering towards end times

Kris Faafoi sits down with The Spinoff’s managing editor to discuss all that bedevils a rowdy sector with big problems and high expectations.

After months of trying, the new broadcasting minister Kris Faafoi finally arrived at The Spinoff’s offices for an interview in early March. It was 4pm on Friday, and we drank a beer and had what they call a robust discussion. Then, for a long time, I forgot about the interview. Just shy of a week later came the atrocity in Christchurch, which became the only story for weeks, and which still hangs heavy in the air.

I mention this to explain the span between the conversation and publication, but also to underline that this conversation happened before we knew as much as we do now about what social media can do. Its values, and how it responds to extreme stress. 

It’s important to note, because a significant part of this interview covers social media, and the way government interacts with it. Faafoi’s comments need to be understood in the context of a man who, like all but one of the rest of us, didn’t know what was coming. 

The remainder of the interview largely concerns the government’s relationship with traditional media. Whether that’s through regulation, its advertising spend, the entities it owns or entirely funds, or those it uses as a vehicle to further other public good goals. 

That reality has changed too. When we first spoke, the owners of Stuff were  asking for expressions of interest – this week we found out it had not found a buyer. Sky’s shares lost double digits, before coming back slightly. Three announced a local version of the megabudget megahit Love Island NZ, before postponing it indefinitely due to the advertising market. The Herald put up a paywall.

All of which is to say that the case for government intervention within both social media and media has gotten stronger by the day. But his responses about the macro and micro of the current media market remain very interesting, in terms of what he does and doesn’t say. And, given that he deferred a number of questions until Budget 2019 – which turned out to contain nothing of substance – I followed up with a number of questions in July. This industry’s expectations were raised by his predecessor, and this is the year of delivery. Will media get what it was promised?

The below has been edited for length and clarity.

Duncan Greive: Could you start by telling in a broad sense me what you think the government’s role in media should be.

Kris Fa’afoi: To ensure that there’s exciting, fresh, informative news and content. I think in a world where we are being bombarded with content from all corners, some of it of questionable quality, public media becomes more important. I think we’ve also got a responsibility to make sure that there’s – using Commerce Commission speak – plurality in the market to make sure that flourishing commercial sector as well. 

The stewardship of the likes of Radio New Zealand, TVNZ, Māori TV, Iwi Stations, community access broadcasters, all those things that are funded by the public purse are important in that.

In terms of that list that you reeled off, they’re all government controlled or largely government funded entities. I think the thing that is interesting about it is that none of them are natively digital. TVNZ is probably the most advanced, but it’s still far from its core. So for all of the wholly government funded or owned entities, digital can feel even now like something of an afterthought.

Yeah but I could say that of all traditional media outlets in New Zealand. If you look at NZME or Stuff, they all came out of a newspaper background and I think in some way or another they’re grappling with the challenge of digital. And I think that is an inherent challenge for the public and private entities is: how do you make a buck if you’re commercial and how do you reach a market that is where the consumption is marketing different to what it was even three or four years ago?

But the private entities that you just listed are a lot more advanced digitally. Put another way, for those who consume traditional media, the government is there, giving them what they want where they want it. That other half of the population tends to be younger, more diverse, certainly not as wealthy, and much more online. Is reaching them something the government’s concerned about?

If you’re looking at TVNZ, I think they put a lot of effort into their OnDemand platform. They will probably admit to that in the news and space that they’re obviously don’t have as many sets of eyes as the likes of Stuff and NZME. Radio New Zealand has traditionally been a radio broadcaster and is branching out and doing more. And I think that’s the challenge for them – to do more.

I’ll repeat the question, because I don’t know if you answered it, do you think the government is doing enough to bridge what does look like a democratic deficit for the most vulnerable audience?

We need to do more. That’s, I think, the broad answer to the question. Some of that is because I think the likes of Radio New Zealand had their funding frozen for nine years, so standing still was their priority and not going backwards. And we were able to put a little bit more funding into New Zealand on Air and Radio New Zealand in the last budget. And the challenge for us is to give them some of the capacity to do more, and hopefully we’ll have some news on that as we get closer to the budget.

I think the challenge that [government owned media] has got is working more collaboratively together. I think if you look at TVNZ, the collaboration with Spark. That’s probably a useful way of doing things in the future too.

Do you think the pace of transition to digital is appropriate? Would you like to think it will accelerate?

I do have an opinion that it’s going to accelerate, because that’s where the eyes are headed. The comments that I’ve made is that if you look at the way that the next generation is consuming their media, it’s not traditional media. It’s predominantly online. And whether it be children’s or factual or news and current affairs or drama, how do you shift that across? And on what platform do you do that? Because if you don’t do it right, then the content’s going to get dispersed across a whole lot of platforms and it may not get watched.

Looking at this from another angle, there are obviously a number of vehicles you could use to try and reach this new audience where it lives. You could fire up RNZ or TVNZ. You could say NZ on Air has historically been our vehicle for solving this type of problem. Do you have an instinct around which should help with that challenge?

I think the NZ on Air funding model doesn’t necessarily have to transition too much from what it has been in the past to go to more digital content. It has funded news and current affairs, drama, comedy in the past for private media companies. And I’m sure we’ll do in the future as well. Concentrating that all into a public broadcaster hasn’t been the way that we’ve done it in the past.

A criticism that Michael Anderson, MediaWorks CEO, has made is that TVNZ effectively delivers artificially low profits in a way that hurts its private sector competitor in Three. And it’s able to act much more strategically than a company that has to deliver a rational return on capital. Do you have sympathy for that perspective?

Michael would say that. But TVNZ face the same commercial challenges, around advertising, that the likes of MediaWorks and other media companies do. So their revenue has only just bounced back in the last couple of years.

I think they have more of a remit around public broadcasting to a degree than MediaWorks does as well. So there’s a cost or a strategy within their operation that Michael wouldn’t have to deal with either. But I’ve also heard his concern around the market becoming even more crowded when consolidation is probably going to be the name of the game over the next two or three years.

On consolidation, the Commerce Commission has had two potential mergers in the past couple of years and it’s turned them both down. Do you think its understanding of media in this area remains up to the challenge?

They’re an independent regulator. I think from a business sense and a plurality sense, they obviously felt that the merger [referring to Stuff-NZME] was going to concentrate too much power in one media entity.

Say Stuff were to disintegrate or disappear – which is not entirely impossible – would government step in? That’s the equivalent in a digital sense of a TVNZ falling over.

But I think asking whether the government is going to step in is the last question. Because we still don’t know. Any talk of government intervention, I think is extremely premature.

Take it as a hypothetical. If credible buyers don’t emerge, or if NZME is actually the only plausible purchaser of a majority of those assets, then would it allow that?

I’m just not going to entertain that hypothetical when the market is still going to do it’s thing. Is plurality important? Yes. But I don’t know which other player in the media market might be interested in buying Stuff. So the talk of government intervention I don’t think would be the right thing to do.

[Author’s note: bids for Stuff were this week judged ‘below fair value’ by its owners, who now say they plan to retain it]

Turning towards the tech sector and its role in the media, there’s a journalist I know who’s got a lot of OIA’s in with government departments to find out how much they’re spending with Facebook and Google.

Yep yep. I know the one.

Your gut says it’s probably a pretty bloody big number. Facebook don’t even pay GST in New Zealand. Google have just breached a suppression order. They create no content of their own. Yes this is an efficient way to reach a difficult to reach audience, but equally these are a big part of the destabilising of New Zealand media. 

Yeah, I don’t necessarily want the government taking the blame for – 

It’s not about taking the blame.

No but I know what the question is. I’d be interested to see what the government spend on advertising as opposed to the private spent on advertising but –

But the private sector doesn’t have to answer to the public to the same extent.

Yes but how much of the percentage of advertising is the private sector? That’s my point. I think the government will play a part in the percentage of advertising revenue, but it’s not everything.

Certainly there is some concern around YouTube, the government department spending on advertising there has been pulled back. 

So there is a precedent. 

And that’s what I’m saying. Because it’s for socially responsible reasons, the funding was pulled. I don’t think we’ve done a massive assessment on the amount of funding or advertising that government departments have spent on the likes of Google and Facebook.

Should you have?

It hasn’t been done.

But should you?

Well we could look into it.

But will you?

Well we might do. But I think the issue here is that if you look at the private spend and the government spend, the government spend probably wouldn’t be the bulk of what has happened. So the market has moved.

Absolutely not, but the market or the private sector has nothing like the same level of obligation to its citizenry than the government does. And irrespective of the collective size of the private sector, the collective size of the government would dwarf any other entity.

I understand the point you’re making.

These are nearly entirely unregulated, or unimagined by a lot of the law.

Yes I think we’ve already started making some moves and trying to make sure that there’s some responsibility on the likes of Google and Facebook to pay some tax in New Zealand and I think you should probably take that as a –

But even setting aside tax. In the mid-’90s, around the world, there were a series of laws which have been collectively known as safe harbour, which essentially allowed things which weren’t imagined at the time, which is the likes of Google and Facebook. You go to the home page of Facebook or the home page of The Spinoff, they’re not a million miles apart, but one of those actors has a huge number of roles and responsibilities imposed on it, and one doesn’t. Do you think that that’s still appropriate given that Facebook made a US$6.9b profit on US$17b revenue last quarter?

And that’s why we’re moving on issues around the copyright act and so on. That review’s still ongoing. So I don’t have an answer for you here right now, but you’re not the first person to obviously raise safe harbour issues with us.

Do you have a personal perspective on that?

No I don’t because the copyright review is underway.

What about sort of defamation, hate speech, cyber bullying, all of the other cool stuff that happens on the internet where Facebook can effectively say well it’s not our problem. Because it’s not just copyright. Copyright in some ways is a very minor part of the problem.

But the suppression orders is another good example with Google. And I think you can lump this into the issues that we’ve got with Viagogo and ticket scalping.

Are we likely to see more in that direction where some of the restraints and costs that are imposed on New Zealand’s private sector media and other entities can at the very least begin to restrain some of these overseas actors?

I’ll phrase it this way. You’ll probably see a lot more concern and action from us than you saw from the previous government.

In terms of your predecessor, Clare Curran had a plan, which was part of the Labour manifesto for a TV channel called RNZ plus. What’s the status of that?

We’ve just recently got some advice from the ministerial advisory group, which I won’t go into too much detail, because we’re still going through some policy discussions to see what is the best place for our public media assets given what’s happening in the wider environment.

Going back to my opening comments, what I’m concerned about and what am I excited about, is making sure content is available that is quintessentially New Zealand. I don’t know that would be too different than what a passionate broadcasting minister would have said 10 or 15 years ago. The difference is how that is delivered.

So RNZ plus. Has it been shelved?

I wouldn’t call it shelved. But what we’ve got is fresh advice from the ministerial advisory group about what are some options that they think that we can look at.

And is RNZ plus one of those options? 

I’m not going to talk about the options. I think because it’s important for us to think all of those through.

When are you likely to finish thinking?

That’s a good question. I don’t want to give you a time frame there, it literally has been delivered in the last couple of weeks. And it’s a lot to think through. So again, there will have to be plenty of conversations.

This year?

I would hope that it could be done this year. Because I think given what else is happening in the media, we need to see a pretty clear direction.

Historically when New Zealand Air was set up, part of the motivation was that without this funding, some things that we consider very important like drama, like comedy wouldn’t otherwise exist. Given that journalism has suffered a significant diminishing of the numbers of people employed, is there a case for funding more of that?

Yes there is. That’s my trade. That’s not the reason why I made the decisions. But I fundamentally think that the fourth estate is important for our democracy. Radio New Zealand and other media entities are looking at how they can protect and grow some local journalism at the moment. 

That’s the public sector, but the private sector is where the loss has been. 

But if they are working with other private media companies to see how they can partner up.

That’s not the same thing as replacing 1,000 private sector journalists. That’s just providing a little bit of supplementary content.

Well, it’s not a bad first effort.

It’s not a bad first effort, but would you say that there is likely to be more of an effort, and it wouldn’t necessarily be strictly within RNZ?

I said to MediaWatch earlier this year that I am keen to make sure that we fundamentally have a strong media. And I think a lot of pushing that came from MediaWatch was that that should be housed within Radio New Zealand.

Colin would say that. Just as I would say that it should be within The Spinoff.

Publicly funded journalism has been delivered by Radio New Zealand, TVNZ, Māori TV and others, but it’s also been delivered by the likes of MediaWorks with The Nation.

So that’s not new thinking. And I think that should continue in the future. 

When we talk about sets of eyes, I believe New Zealand Air does the best and most interesting research published on the media. It does it every two years. Nielsen publishes every day, but Nielsen is funded by and has its parameters set by the industry which it’s surveying. TV is effectively signing off on its own accounts. 

I’ve not heard it put that way, but yeah.

So when the government is making these decisions about where the eyes are, where the audiences are, what is it basing them on? 

I take a lot of weight over those audience numbers that New Zealand on Air put out. Because they’re not necessarily looking at the audience for commercial reasons, you know what I mean?

I can read the tea leaves on where the sets of eyes going. Our challenge is moving from a setting where almost nothing was done to move with the sets of eyes, to do you just want to meet with them, or do you lead the sets of eyes to the different viewing patterns?

When television first started, it’s 1960, there are fuck all TV sets. The shows were very expensive to make. The government led there. The government said, ‘We believe that this thing is coming. We’re going to put down roots. We’re going to build this thing out.’ They were investing for the future. There has been none of that kind of vision or leadership at any point during the digital era.

Yet. Yet. You’ve got to keep an eye on things that are moving all the time and making sure that the timing is right.

The timing wasn’t right in 1960. They had to build it ahead.

I think comparing that change and transition to this change and transition is different.

How?

Because back then we could control everything that people could see.

But we didn’t have anything like the technological penetration we do now.

So they weren’t fighting, a rather large way, the content coming from elsewhere and the platforms.

We’re not fighting it right now, really. We’re just sort of letting it happen. 

You got kids?

Yeah.

And what are they watching?

They’re not watching any New Zealand content. I mean Hei Hei’s wicked but they watch Netflix and Lightbox, neither of which can be funded by New Zealand on Air.

That’s what I mean. That’s what they’re fighting.

If Netflix were to get a 70 percent market share here, and the audiences for free to air dwindled to the point where it’s so inefficient to continue to fund it there, would you fund behind a paywall?

No, because I still think there is still a gap in the market for us to do something for ourselves that it is quintessentially Kiwi.

But what if the audience continues to radically move?

I don’t think we’re quite at the point. I still think there’s still the ability for us to do something that is quintessentially Kiwi and –

But could you do something quintessentially Kiwi with Netflix?

I don’t think we’re at that point yet. 

Okay. So what’s your favourite New Zealand content? Give me a week in the consumption of Kris Faafoi when you don’t have all of your portfolios on.

I’ve woken up on an automatic setting to listen to Morning Report for probably the last 20 years. And then I’ll switch on the telly and watch breakfast TV.

Which one?

Both.

Yeah?

Predominantly the AM Show. Because I know what I’ll be fighting during the day after that. But then unfortunately not much after that. I’ve got a 20 month old boy. I like going onto YouTube and watching the Mo Show with him.

And what else do you like. You’ve got to give me more.

I’m a bit old fuddy duddy. So I’m a big New Zealand music fan, but probably from about 15, 20 years ago. So I listen to a lot of Neil Finn and Crowded House which was probably cool about 10 or 15 years ago, but not so much anymore.

What else? 

See I’m not a content snob.

Do you watch reality television?

Yes.

Come on then, what?

I’m not telling you.

Do you watch Married at First Sight Australia?

I’ve been known to watch it.

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What do you think of the whole Bronson and Ines situation?

Shocking. And she got what she deserved. What else? 7 Days, if I’m kind of watching TV on a Friday night, but there’s not much time for that any Moreover. What I’m really, one of the KPIs for me is going to be children’s content.

And that’s interesting. So Hei Hei is such a cool idea. They had a fuckload of downloads. I don’t know what it’s actual usage rates are. I hope it’s working. If it’s not, if it turns out that the best way to do it is to sort of somehow work with YouTube – are you open to it?

Well that’s what the Mo Show has done. And it’s accessible for parents like me.


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