The Government’s media dilemma

There is certainly a good argument for a properly funded ad-free public TV broadcaster. TVNZ is currently neither fish nor fowl: it doesn’t need to return a profit, has an implicit government guarantee but also competes in the market for commercial advertising.

Then there’s the potential NZME-Stuff buyout which could involve some sort of ‘‘Kiwishare’’ type arrangement. That could either mean the Government allows the deal to go ahead, but with a contract with the new entity to ringfence Stuff (publisher of the Sunday Star-Times). Or it could mean the Government taking some sort of equity stake in the business to ensure that two editorial voices in the printed media space are still heard.

And now, as Stuff has reported, another arm of Government, the Broadcasting Standards Authority, is making a land grab to regulate NZME and Stuff’s streaming services, Spark sports and potentially even Facebook video so it can regulate them in the same way it regulates TV and radio. In 2019, in an internet age where literally anything can be accessed by anyone, on a touch screen or with the click of the mouse, the Broadcasting Standards Authority is trying to regulate media as though they were no different to traditional broadcasters it was set up to look after in 1989.

Underlying all this is the original decision by the Commerce Commission that the merger of NZME and Stuff should be blocked. Not because it would see a substantial lessening of competition – that is demonstrably false as the commercial reality is that old media companies are competing not with each other for revenue but with tech giants Alphabet (Google) and Facebook. No, instead it was decided that the merger would decrease the plurality of voices in the market: when clearly the internet has seen an explosion in them, just in a different form than before.

To its credit, the current Government, in considering the NZME-Stuff merger has realised that it is behind the regulatory eight ball and that it might need to organise some workaround that won’t create a precedent and undermine the commission.

Yet all of these developments are driven by a government apparatus (not specific to the current administration) that still doesn’t seem to understand that a new set of regulatory settings are required to deal with media in this new age. The old silos of print, radio and TV have been broken down by the internet and aren’t coming back. In a practical sense, the old regulatory distinctions between the three are now largely arbitrary.

The public broadcasting sector is a mess: some of it is commercial, some not and then there is a sprinkling on NZ on Air cash over the sector. The private media sector is operating in a tiny market that can not consolidate to fight the real rivals.

If the Government’s upcoming media statement did not begin with a blank piece of paper with some principles-based legislation, laying out a clear path for public broadcasting and fit-for-purpose regulatory structure for the 21st century industry, it should have.

The private media sector is operating in a tiny market that cannot consolidate to fight the real rivals.