Media diversity in public’s interest
THE strong draft decision from the Commerce Commission last year rejecting the proposed merger between the giants of New Zealand media, Fairfax and NZME, sent a clear message about the importance of media plurality. The commission has since twice delayed making its final deliberation. May 2 is now the due date. So what has changed?
It is worth reiterating the breadth and depth of ownership that would result: 90% of daily newspapers, most community papers, the Sunday papers, the farandaway dominant news websites (stuff.co.nz and nzherald.co.nz) and half the commercial radio stations, including Newstalk ZB, ZM, Radio Sport, the Hits, Coast.
The commission examined this situation and, tellingly, chairman Mark Berry said the merger would result in ‘‘an unprecedented level of media concentration for a wellestablished lib eral democracy’’ and a print concentration unique outside China.
As well, the merged entity would have indirect control over much of the national content provided to the remaining independentlyowned print media that rely on this content for their regional audiences.
Fairfax, in particular, put its eggs in one basket when it promoted its digitalfirst strategy and undermined its newspapers through diminishing their resources and talking them down. Unfortunately, that basket was tipped over as Facebook and Google scooped up most of the digital advertising.
Somehow, the merger is supposed to be crucial in allowing the new company the scale and the time to deal with falling revenues. While costs will reduce with staff cuts, including no doubt many journalists, buying some time will not solve underlying issues.
In fact, continued competition could well prompt survival strategies, innovation and ways of coping with the changed and changing media landscape. There is little, for example, to stop more collaboration, alongside healthy rivalry and news and advertising competition. Before the Australian owners applied their foreign models to the New Zealand scene, there was national news cooperation and a vigorous, joint national advertising voice for newspapers.
Necessity has forced collaboration through shared printing presses. Fairfax’s Southland Times, for example, is printed by Allied Press in Dunedin and several Fairfax newspapers use NZME’s Ellerslie printing press. There is also cooperation between NZME and Fairfax on one digital advertising mechanism. Cooperation for financial savings can be extended without single ownership, and can include independent papers like this one.
Fairfax and NZME continue to pressure the commission, and they have argued the commission is beyond its powers in considering public policy — the potential loss of news plurality under one owner — rather than just matters commercial.
Radio New Zealand, Television New Zealand and Mediaworks (TV and radio) provide some mainstream and national news competition. But they all lack the depth of either Fairfax or NZME, and the penetration regionally and locally. Apart from Mediaworks radio stations and in limited markets, competition for print and radio advertising also would be dominated by a combined company.
Other news websites have emerged, some with quality content. But they are strictly limited in their reach, being read by news enthusiasts rather than the mainstream. As the commission’s draft determination said, ‘‘it is the authority, reach and sustained, consistent and comprehensive activity of the larger established players which often give those stories national prominence and currency’’.
The necessary plurality, if anything, becomes more important as commercial pressures increase. A range of strong voices are required if media is to play its crucial traditional role for the benefit of citizens and the community of holding the powerful to account.
Fairfax and NZME should face the challenging future independently. And if that future is as bad as Fairfax seems to be claiming, then it still has the choice of getting out. The bottom line is that the interests of consumers would be worse served if the merger is approved.