Watchdog defends merger call

The Commerce Commission has emphasised the importance of journalism produced by Fairfax New Zealand and NZME in defending its decision to block the media companies’ merger.

Faifax and NZME have gone to the High Court in Wellington to challenge the competition watchdog’s decision in May not to grant approval for their merger.

Opening the commission’s defence yesterday, Jim Farmer, QC, said Fairfax and NZME were ‘‘still by far the major creators of serious news’’ in New Zealand.

If the merger was allowed, they would own the country’s two largest news websites, 90 per cent of newspaper circulation and half the country’s commercial radio stations, he said.

As well as having implications for competition, the ‘‘level of reach, control and influence’’ the merged firm would have over public opinion was also a relevant consideration for the commission, he said.

David Goddard, QC, acting for Fairfax and NZME, said a comparison made with China in the commission’s final determination was ‘‘troubling’’.

The commission had said that if the merger was approved, New Zealand would have the secondhighest concentration of newspaper ownership in the world behind China, citing academics.

That was ‘‘alarmist and irrelevant’’, Goddard said.

But Farmer said the importance of news organisations in producing ‘‘credible and trusted news could not be understated’’.

Justice Robert Dobson, who is presiding over the case, appeared to press Farmer on whether the commission was taking too purist a view of the definition of ‘‘news’’.

Based on past cases of similar length, a ruling by the High Court may be several months away.