Follow the Money
With newspaper ad spend on the way down, Erin Mckenzie explores the different models local news media companies are using to fund journalism.
P17. Bad news P18. Build a wall and make them pay for it P18. Selling the sausage, not the sizzle P19. Domination stations P20. Sponsors - a moral dilemma P21. Get up, stand up P22. Merger she wrote P23. Filling the gap P24. New revenue P24. Combine and conquer P24. The new newsrooms P18. Pulling down the wall P20. Journalism has a PR problem P23. The $15 million question
Follow the money. It’s an axiom that journalists have believed in for years and a guiding light when it comes to holding the powerful to account. But that phrase is increasingly pertinent to those who run media businesses. As advertising money flows away from traditional channels towards large tech firms, the old business model of selling space around the news is creaking. And that has led to a range of experiments from publishers and broadcasters hoping to keep the lights on – and to keep shining those lights into dark places. Erin Mckenzie dives into the local news media feed and finds plenty of experiments, but no simple answer to the funding conundrum. We live in an information-rich society. At the press of a button, a click of the mouse or the flick of a page comes a wealth of local and international news and current affairs. On the flip side, as we’ve seen with recent political events, we also live in a misinformation-rich society. Who is regulating the content? Who is telling the truth? And what are the agendas behind the information? This tension means the accuracy, fairness and truth of journalism is in even higher demand at the moment as some of those in power pull at the strings of what seems to be an increasingly fragile democracy. TVNZ head of news and current affairs John Gillespie says more so than ever, anyone can assume the mantle of a journalist, but making sure the writing is truthful, correct and fair is a skill that tends to go by the wayside from individuals who are not professionals. Some comfort, however, can be found in News Works’ Trust in Media research with Colmar Brunton. The 2017 study examined how consumer trust in media has evolved with the digital media landscape and news media came out on top. When 600 respondents were asked to indicate how much they trust the news and information from digital media channels, news media websites/apps got 84 percent followed by Google’s 81 percent. TV website/tv apps got 77 percent while Facebook was just 38 percent. Looking at traditional media, newspaper and radio both received 87 percent and TV 86 percent. So why is it that Gillespie says journalism is under more stress than ever? Looking at some of the employment numbers, it’s clear: according to census data, 1,170 New Zealanders worked in print, radio and television journalism in 2013, down from 2,214 in 2006. And while most understand the need for journalism, the problem is that no-one’s entirely sure where the money is coming from to fund it.
Earlier this year, Standard Media Index (SMI) released the 2017 agency ad spend in New Zealand showing positive growth totaling a record $1.04 billion was spent on major media across the country. Unfortunately for newspapers, they did not see that growth as agency advertising spend on the channel was down 6.9 percent to $56.7 million. Newspapers and magazines (down 14.3 percent) were the only two media
I THINK IN THE CASE OF OUR NEWSPAPE RS WE HAVE SEEN PEOPLE ARE PREPARED TO PAY FOR JOURNALISM AND WE BELIEVE IT’S HIGH TIME THAT WITH THE RIG HT JOURNALISM AND PREMIUM CONTENT PEOPLE WILL BE PREPARED TO PAY FOR THAT IN A DIGITAL SENSE. – SH A YNE CURRIE
channels to fall. Shortly after, the Advertising Standards Authority (ASA) released its 2017 report on New Zealand’s advertising revenue and, again, newspapers were on a downward trajectory. Revenue in 2015 was $474 million, in 2016 $417 million and in 2017 $353 million. Where there was positive growth for newspapers was the “newspaper digital” category, which has been on the up since 2015 when it sat at $41 million, to sit at $82 million in 2017. In both the SMI and ASA reports, digital was on the rise. And TV was holding firm, with the 6pm news still bringing in some of the biggest audiences. However, signs are emerging that digital’s shiny-new appeal could be wearing off. In 2017, P&G cut $200 million from its digital spend due to bot and brand safety concerns and reinvested in channels with bigger reach including television, audio and ecommerce. And earlier this year, Unilever threatened to pull advertising from online platforms that allowed "toxic content". So could the concerns over tech see local advertisers move their spend in a similar direction? When Stuart Rutherford, managing director of Zenith New Zealand was asked the question by NZ Marketing, he said he sees no evidence that advertisers are shifting budgets away from online. By contrast, he said, its share of global advertising expenditure continues to rise rapidly and is forecasted to hit 44.6 percent of global ad spend by 2020. “The concerns we have seen from large FMCG multi-nationals and others relating to brand safety and corporate responsibility are valid and yet they simply will not stop the tech and digital juggernaut, and we certainly will not see them shifting large spend back into traditional print channels.” Most agree that advertising is not the answer if media companies hope to fund news and current affairs content. So what is it?
BUILD A WALL AND MAKE THEM PAY FOR IT
Look around the news media industry and you’ll see walls are going up. Newspaper brands like The Washington Post, Financial Times, Wall Street Journal, and The New York Times all have one. Conde Nast brands The New Yorker, Vanity Fair and Wired have launched ‘soft’ paywalls, in the belief that having paying readers rather than relying on advertising just makes them better. Adweek has also recently launched a paywall. And, in many cases, they’re proving to be worthwhile. The New York Times now has over 2.2 million paying readers according to Recode and the business has grown 30 percent each year since it started in 2011. Finally, consumers seem happy to pay for access to good content and, at a time when Donald Trump has attempted to destabilise democracy through constant attacks on the media, many have seen the need to support the journalistic institutions that hold power to account. Closer to home, NZME announced plans to have digital subscriptions in place by the end of the year. The announcement came at a similar time as the release of its 2017 financial results, which basically showed what they’ve been showing for years: in 2017, its print advertising revenue was down nine percent, reaching $121 million, down from $132.7 million in 2016. Its circulation revenue was also down three percent, reaching $83.3 million from 2016’s $86.1 million. Meanwhile, its digital performance showed healthy growth, outperforming the market with digital revenue growth of 18 percent. But it’s still relatively small. And, given it, and all other media companies making expensive-to-produce news content, is competing for eyeballs with other digital behemoths (as well as smaller, very popular and non-journalistic domestic sites like Metservice and Trade Me) it’s getting harder to sustain this still largely ad-funded business model. That reader revenue is sure to rise with digital subscriptions. And, to get there, NZME managing editor Shayne Currie says it will focus on improving premium journalism and nurturing audiences online. “We have a project team looking really closely at what we can offer in terms of premium journalism, what people are prepared to pay for, and how we present that generally.” He adds, NZME doesn’t refer to it as a “paywall” anymore because it sees it as having negative connotations. Instead, it’s called a “digital subscription tool” or a “pay gate”. Many other publications call it a membership, often offering tiered options and various benefits. “I think in the case of our newspapers we have seen people are prepared to pay for journalism and we believe it’s high time that with the right journalism and premium content people will be prepared to pay for that in a digital sense,” says Currie.
SELLING THE SA U SAGE, NOT THE SIZZLE
But what is premium content? Currie admits it’s quite subjective but says “it’s the strong work that reporters are doing each day, with the big in-depth investigations that you won’t find anywhere else”. One news organisation with a paywall already in place is Newsroom. Founded by Tim Murphy and Mark Jennings in early 2017, the site appears in two forms, one a free newsfeed and another called Newsroom Pro. The latter publishes news, commentary and information for paying subscribers, which
includes corporations, government agencies, local councils, NGOS, and individuals. However, Murphy says both Newsroom and Newsroom Pro report on the things that matter to New Zealanders. Looking at how the paid subscription model is performing, Murphy says they’re “more than happy with where it’s at” and, while he wouldn’t discuss specifics, he says they’re on track and believes reader revenue will continue to grow. Right now, he says 35 percent of its income comes from subscribers and that will be above 50 percent by the end of year three. In four- to five-years, he sees subscribers being its biggest form of income. But while the paywall appears to be on a positive trajectory for Newsroom, questions have been raised about the effectiveness of a paid subscriber model. According to Rob Howard, author of Hiatus, paywalls conflict with the internet age, because they charge readers when there is limitless free content. He says for media companies to charge readers money, they have to ensure the offering is something worth paying for. “The reality is that 80 percent of currentevents news is interchangeable, regardless of your source. If you’re looking for today’s top stories, you can pick from a limitless list of vendors and walk away with a very similar body of knowledge,” wrote Howard in a piece published on Quartz, Atlantic Media’s very successful – and free – business publication. Another point of conflict he points out is with the primary role of journalism, which is to educate and inform the public about important issues. How can publishers decide what is free and what is paid-for in a way that doesn’t undermine their other content? When nzherald.co.nz was redesigned it featured a section called premium and in-depth, which many felt was an admission that all the other content on the site didn’t fit into that category. “When the papers say, ‘this is so important that we’re making it free,’ they’re simultaneously saying that all the other stuff they publish doesn’t really matter, so they’ll charge you for it. It’s hard to imagine a business philosophy that’s more upsidedown,” said Howard.
One funding model that doesn’t differentiate between content is voluntary donations, something most famously employed by The Guardian, which asks readers to support its mission in exchange for making content freely available to anyone who wants to see it. Presspatron is one service allowing donations to be made to news media organisations and founder Alex Clark says for too long publishers have been making the assumption that they need to replicate the newspaper strategy online and force audiences into a fixed price. But that’s not how he thinks they should approach it. His knowledge comes from study in digital media, entrepreneurship and internet law at Victoria University of Wellington, UT Austin and UC Berkley, as well as working as a media researcher. In 2015, he was conferred the Master of Advanced Technology Enterprise having graduated with distinction for his thesis evaluating consumers’ willingness to pay for journalism under different funding models. In it, he asked 416 respondents which model they would be prepared to pay for when presented with 10 funding strategies and had interviews with news media organisations including The New York Times, The Economist, Mediaworks and Fairfax. Of those surveyed, 1.4 percent said “definitely” to making a voluntary monthly contribution to their favourite news website or blogger, with $11 being the average amount. 11.1 percent said “probably” to contributing. While not high, the finding was significantly higher than the 0.24 percent who said they would “definitely” pay for a subscription to a website with content restrictions such as a paywall. 2.6 percent said “probably” to the idea of subscribing. “More respondents were willing to make voluntary contributions than pay for paywalls,” says Clark. Armed with that knowledge, Clark created Presspatron. It allows news media organisations to crowdsource with supporters of journalism who make monthly or one-off contributions to their favourite media sites. Clark too has been on the frontline of the print advertising freeze. He was editor of Tearaway magazine from 2007-2009, through the GFC, and he experienced first-hand the trouble news media organisation are going through. Clark watched the magazine drop from 64 pages a month to 28 and within a couple of years after he left, it went out of print. It does, however, remain online. While Tearaway is not using Presspatron, over 18 local media websites are and it’s working to expand across the US and Australia. From those using it, Clark says its performance exceeded his research, with many supporting journalism and continuing to do so. He says while it’s easy for monthly donators to cancel, the cancel rates are lower than those compared to paywalls, with 85 percent of those who signed up still contributing each month. “It’s incredible – unexpected in terms of value. It’s exceeded research that I’d done.” It’s also benefitting the news media organisations as a way of revealing what their readers care about. This is seen in the influx of donations they will receive following hard-hitting investigations. And while clicks have long been a measure of success, Presspatron has introduced a new click to measure—the donation button. “If you look at articles that have the most clicks on the donate button, it’s a better metric for quality than page views or time spent reading,” Clark explains. “That’s because when you measure clicks you are measuring curiosity, not what they care about.” And that change of focus can only be beneficial to the quality of journalism produced, he says. “A lot of sites have pursued the mass audience strategy because they are only pursuing advertising revenue and it’s distorted internally what they are focused on. They are prioritising clicks and shares on Facebook. And while it makes sense if they are only relying on advertising revenue, it’s nice there
IF YOU LOOK AT ARTICLES THAT HAVE THE MOS THET CLICKS ON DONATE BUTTON, IT'S A BETTER METRIC FOR QUALITY THAN PAGE VIEWS OR TIME SPENT READIN G. – ALEX CLARK
is another model that can help to refocus on the core mission of what media is all about.” But that’s not to say media outlets can’t still have ads. Because there’s no paywall, there’s no expectation that ads will be filtered out, which means Presspatron can be used to complement existing revenue streams. Newsroom is one of those and it sees over 500 fans donate every month alongside its Newsroom Pro subscribers. Murphy says those donations include $10, $20 and up to $100 per month, which to him shows supporters have faith in it to “keep going hard”. The Spinoff is also using Presspatron to fund investigative long-form pieces and while the donations have seen it fund its own writers Alex Casey and Noelle Mccarthy’s ‘In plain sight: behind the pages of Pavement magazine’ investigation, partnerships editor Simon Day points out Presspatron is encouraging for individual journalists. “As a freelancer, it can be really difficult to fund your ability to do the much harder stories because you have to do a whole lot of leg work that’s unpaid before you get to a point where you are able to pitch an investigation,” he explains. “It can keep some freelance journalists afloat.” Presspatron is also keeping afloat not-for-profit platforms, such as Crux and The Scoop Foundation. The former is owned and published by the not-for-profit Southern Community Media Trust, which provides issues and action focused public interest journalism to the Southern Lakes District, while The Scoop Foundation for Public Interest Journalism is a not-for-profit charitable trust with an aim of making information freely available to New Zealanders.
SPONSORS – A MOR AL DILEMMA?
Like Newsroom and many other websites, including ICG Media brands Stoppress, Idealog and The Register, The Spinoff’s Presspatron donations are supported by another revenue stream: sponsorships. Whether it’s one-off pieces or sponsorships of entire sections, Day says they are brands interested in facilitating interesting and modern conversation around the world and they include Spark, Kiwibank and founding sponsor Lightbox. For Spark, its sponsorship is seen in The Spinoff’s music section and that’s representative of its desire to foster and encourage great music experiences – a goal linked to its sponsorship of the Spark Arena and partnership with Spotify and Auckland City Limits. Meanwhile, when The Spinoff teamed up with Kiwibank in 2016, managing editor Duncan Greive wrote about the partnership, explaining the topics it will be covering about the economy are critically important to our society, so it has attempted to fill them with the chaos and humour the site is known for. “…I hope they travel a long way. Kiwibank’s aim and ours is to get our audience to be more conscious in their consumption and think about where the dollars are going, and what they’re fueling,” Greive said. Sounds like a win-win for both parties. But that win-win does raise the eyebrows of some because they believe brands funding journalism throws up an ethical dilemma. Do they influence editorial decisions? Day says: “We’ve never had a story jeopardised, or put back in the draw, or manipulated for the benefit of one of our sponsors.” Evidence of the point can be seen in The Spinoff Bulletin, a curation of stories from around New Zealand media delivered to inboxes with the help of its sponsor Vector. Day says earlier this year when Vector was under fire for its post-auckland storm response, The Spinoff included stories about it in The Bulletin. Vice is another news media company with sponsors in its funding mix, and like Day, editor Frances Morton is adamant they don’t interfere with editorial decisions. When entering into a partnership, she says they will always ask themselves “will we be making this content anyway?” and put the interest of the audience first. “I think that’s one of the reasons we are attractive to brands and have that strong relationship with our audience. There have been times in the past where we have turned down deals because we didn’t feel confident that we wanted to be putting out that content.” For TVNZ, every partnership is entered into with great consideration because Gillespie says selling sponsorships is more than just a financial transaction. “The biggest thing we have to sell is out credibility,” he explains, “and if audiences think that’s been affected by a sponsorship or a logo that’s involved in bringing the news and current affairs then we are killing the goose that lays the golden eggs.” Looking at TVNZ’S offering as a whole, not news alone, according to its 2018 interim report, TVNZ enjoyed growth in TV and online advertising income, which contributed to total revenue of $170.4 million, up $1.6 million (or one percent year-on-year). Newsroom also relies on sponsors and Murphy joins the chorus in saying those sponsors do not interfere. He says the repercussions of interference are not positive for either party. “Everyone is very mature and commercially aware: If you are getting into
that zone of influencing content it’s not good for you.” Most say there is no interference from sponsors with this funding model and most sponsors understand that their connection doesn’t guarantee positive coverage. But many believe it’s more subtle than that. It’s often about the stories that might not be written when others are. Commercial and editorial departments were originally set up to be like church and state. And they were set up like that for a reason. As Chris Keall wrote on NBR: “Corporate sponsorships always come with subtle and not-so-subtle pressure, particularly as renewal approaches. And in my immediate experience, even when a company has mature leadership, there’s often at least one manager who thinks they can leverage the situation for influence.” But as Newsroom’s Murphy replied in the comments: “Your argument is completely disproven by the fact that we did an uncomfortable story involving one of our foundation supporters and treated them exactly the same as any other organisation or newsmaker. Fullstop. We ran what they decided they would say in response to detailed questions we put to them.” Another issue is that sponsors have a habit of leaving as new marketers arrive, new strategies are implemented or goals aren’t reached. When a sponsor is integral to the creation of new sections, it becomes even harder.
GET UP, STAND UP
If 2017’s EY Business Journalism Awards are anything to go by, not all brands appreciate the need to step aside. New Zealand journalists proved their integrity last year when many boycotted the awards after a badly handled conflict of interest. It disqualified an NBR series that was critical of Fuji Xerox New Zealand, which was one of EY'S audit clients. With NZ Listener journalist and judge Rebecca Macfie's suggestion that the two EY judges simply remove themselves from the judging ignored, she was prompted to resign. NBR showed solidarity with its journalist by withdrawing all entries from the awards and it was followed by others, including NZME, Fairfax and RNZ. When editor Duncan Bridgeman shared the news of the conflict of interest and NBR’S decision to withdraw its entries, he said: “Journalism is meant to act as a public watchdog and does so without fear or favour. If corporate sponsors can’t accept that, and instead do the exact opposite, what business do they have running these awards?” He isn’t the only one at NBR raising questions about the involvement of corporate sponsors as a means of supporting journalism. Publisher Todd Scott, who was NBR’S chief executive and sales chief before buying out long-time publisher Barry Colman in 2012, considers himself a passionate advocate and supporter of journalists and doesn’t see corporate sponsors as the way to go. “I’ve got some real concerns over the number of, particularly new media, that are relying on sponsorship or corporate welfare to fund their newsrooms.” Despite the reassurances that are given in contracts, Scott says we have to accept the only reasons corporates offer the funding is because they believe they will get something favourable in return. “It could be all above board but as long as that type of funding exists, there’s implicit expectation that you’d never hang a sponsor out to dry.” And sponsors aren’t the only funding model Scott has called into question. Earlier this year, NBR publicly stated it would not pay any media agency commission, saying the "gravy train reign is over”. Scott took to Twitter to report agencies boycotting NBR, with phone lines going dead and email bookings and enquiries stopping. However, it didn’t seem to concern him as he said clients’ needs always come first and “agencies are not the client”. Another tweet said: “Focus on the mission not the commission” and, for Scott, that mission is increasing subscribers, which he sees as the only way to ethically fund journalism. “There are no conflicts of interest if what you are doing is delivering a service to member subscribers or readers that pay for content. They don’t control how you write it, they simply want to support ethical, intelligent, unbiased journalism.” Right now, NBR has over 5,000 individual online subscribers committing $35 a month to its offering and 181 subscribers paying varying amounts for company-wide access via their IP addresses, but he hopes to reach a short-term goal of 10,000 monthly paid online subscribers. From there, it will set its sights on 30,000 and then, as he told RNZ’S Colin Peacock, 100,000. He says there is too much free content out there and the reason it’s free is because advertisers, corporates and PR companies all have a hand in it. “If Donald Trump has proved anything in America, it’s that you need to be cognisant of who you are relying on for your media. Who do you trust? Who do you rely on? Absolutely there are 10,000 subscribers out there.” To get the numbers up, Scott says NBR plans to broaden its content outside the silo of business news and get involved in the business of science and the business of medicine. “What’s exciting about it is when we get to 10,000 monthly online paid subscribers, we will be even less reliant on advertising support and that money we generate from paid subscriptions will be reinvested so that we can broaden the overall appeal of our offering,” he explains. “NBR in the future—they won’t know that it stood for National Business Review. People will know it stands for exclusive, intelligent content that’s not freely available and you have to subscribe to.” Looking beyond its content offer, NBR is
investing in technology to keep up with how its current and potential future subscribers want to read, watch, listen and engage with it. The first will be a new website in July that’s seen half a million dollars of investment before a mobile app launches later in the year involving additional investment.
MERGER SHE WROTE
NBR’S plan is well underway, and, given the pressure on its previously lucrative print product, it needs to move fast. The same goes for NZME and Stuff, but their hope to face the changes and move forward together as one has not gone quite to plan. In 2016, the two sought approval for a merger in response to their business models being undermined by the international giant, aka Facebook and Google. The merger proposed to bring the two newspaper networks and corresponding online news sites under common ownership. The Commerce Commission’s preliminary view was that the merger would be likely to substantially lessen competition in advertising and reader markets – specifically Sunday newspapers, online news and community newspapers in 10 regions. It also indicated that the merger would not be of such a benefit to the public that it should be allowed. The decision was later upheld by the High Court and that ruling is being appealed in the Court of Appeal. Should that be successful, the two companies will renegotiate the commercial terms of the deal. Reflecting on the last two years, NZME’S Currie says early on there was uncertainty about what the merger would mean for journalists, but as the legal process has been drawn out, that has settled. Now, the attitude he sees is heads down, business as usual to do the best job they can. Similarly, Stuff editorial director Mark Stevens says since the “no” came out, it’s cracked on and run its own race and points out “the amazing work that’s come out from both companies, journalism is strong and healthy at the moment”. However, Stevens does add there was some irony in the decision to deny the merger. “There was a lot of concern during the Commerce Commission process around losing the plurality of voices and the irony is if we are not there we will be losing plurality of voices.” During one of the hearings conducted in the lead up to the decision, Fairfax Media chief executive Greg Hywood stated emphatically that preventing newspaper publishers from making necessary commercial decisions would spell an “end-game” for the business. “We believe that the NZCC has failed New Zealand in blocking two local media companies from gaining the scale and resources necessary to aggressively compete now and into the future.” Hywood also did not shy away from explaining what this would mean for the local business. “In light of the NZCC decision, an even greater focus on cost efficiency will be necessary,” he said. “Moving to the next stage of our New Zealand publishing model will involve reshaping how we deliver our journalism to local communities. Further publishing frequency changes and consolidation of titles i s an inevitability.” That statement has since become a reality, as it announced in February that 28 mastheads would be sold or closed. This followed Fairfax Media reporting its net profit, after tax, for the six months to end of December reached $38.5 million, a 54 percent drop on the prior corresponding period. For the local arm of the company, now rebranded as Stuff, the six-month interim results released in March showed print advertising revenue fell by 14.9 percent and audience subscription dropped by 4.3 percent. And according to the New Zealand Herald, as of 22 April, half of Stuff’s revenue comes from its top five mastheads, including The Dominion Post, The Press and the Sunday Star-times, while non-print revenue accounted for 17 percent, up from five percent just four years ago. Since the announcement to sell or close mastheads, there have been three rounds of closures, amounting to 25 closed titles, one sold title (Avenues magazine) and two under review (Clutha Leader and Kaikoura Star). Stuff was unable to find buyers for the closed mastheads and, as a result, 38 jobs have been lost. When 15 of the closures were announced in May, chief executive Sinead Boucher said: “This outcome isn’t what we all would have ideally wanted, and once again I really want to thank those affected for all their hard work over many years.” Stevens says the step away from those mastheads is not an exit from content, audiences or the readership in those areas. And he points to Stuff.co.nz and Neighbourly as modern versions of the same service. “We have hundreds of thousands of members on [Neighbourly] and it makes absolute sense that we use that to showcase our local and regional journalism wherever we can.” Meanwhile, Stuff’s remaining Monday to Friday metropolitan and regional newspapers
NBR IN THE FUTURE–THEY WON'T KNOW THAT IT STOOD FOR NATIONAL BUSINESS REVIEW. PEOPLE WILL KNOW IT STANDS FOR EXCLUSIVE, INTELLIGENT CONTENT THAT'S F–REELY NOT AVILABLE. TODD SCOTT
have been reimagined, going from broadsheet to compact format. Again, Stevens does not see this as an exit from its content and audiences, saying there’s been investment in quality content and journalism going out in them.
FILLING THE GAP
With Stuff shedding many of its regional journalists on the ground, opportunities have opened for local players to swoop in with the development of local apps. Wanaka, Wellington, Southland and Nelson are among eight provincial apps that are part of the Independent App Network of New Zealand. One of those, the Nelson App, found a gap to fill when Stuff culled its regional sports journalists and found it was in a good position to take over that role so a sports reporter was hired. Andrew Board is managing director of the app, as well as the independently owned Nelson Weekly, and he told RNZ, because of the app he’s increased his team of journalists by 70 hours a week. More recently, The Southland App was launched by Advocate South and in the announcement, general manager David Pickett said: “We ultimately want to be the definitive place to find accurate and timely Southland news, weather and road conditions, sports draws and results, death notices and acknowledgements, business directories and
much more, with the convenience of being always at your fingertips." "Kind of like the newspaper of old, but in a format for today." Funding for the apps comes from localised, directory-style advertising and Wanaka App developer Tony O’regan told RNZ the news apps are providing a sustainable advertising revenue stream, unlike news websites.
N EW REVENUE
Looking at the digital revenue figures of media companies makes for harrowing reading in comparison to what they were making in print. It’s simply not enough to sustain these expensive newsrooms, which is why media companies are diversifying their revenue streams. Media companies have long attempted to sell things, and very few of them have done it successfully, but over the last couple of years Stuff has added a number of new, non-news related products to sell to its significant audience. It’s launched pay-per-view streaming service Suff Pix, created Stuff Fibre with New Zealand Fibre Communications Limited, launched a digital energy business called Energyclubnz and partnered up with NIB to create health insurance provider Done. When Stuff Fibre launched, Simon Tong (Fairfax managing director at the time) explained the move was a means by which to keep its news offering going. “We’re really proud of the fact that we’ve kept so many journalists in their roles around the regions, and we really want to maintain that because that’s what makes us different,” he said. “The question isn’t ‘how many journalists do we have’, but rather ‘how do we pay for the level of journalism we’ve got today in the future.’” NZME, which has a wider range of assets at its disposal through radio brands and ecommerce engine Grabone, has also recently added new recruitment, automotive and property platforms to its list of digital assets. Called YUDU, Driven and Oneroof, they extend on classified listings that have long been included in newspapers – and more recently have moved across to online marketplaces like Trade Me, Seek or Realestate.co.nz – as they offer recruitment, vehicle and real-estate listings respectively. Currie says it absolutely sees them as huge opportunities for revenue. And like Stuff, he does not signal a move away from its papers. “The newspapers are still vitally important, and our print subscribers are very loyal,” says Currie.
COMBINE AND CONQUER
Beyond new revenue sources, other opportunities for news media organisations have opened up in the form of partnerships. Once upon a time, exclusivity was something used to gain a competitive advantage but now the value of combining talent, resources and audiences has been realised. For Stuff that’s demonstrated in its work with Māori Television, RNZ, TVNZ, and Newshub. The latter partnership resulted in A Tale of Two Cities, an investigative piece examining the gaps in prosperity across Auckland. Stevens says we will see more and more of these relationships and collaborations in the future as a way of securing the sustainability of journalism in New Zealand. RNZ’S chief executive Paul Thompson agrees, saying it now understands if more resources, like two newsrooms, are thrown at a story, the impact of the journalism increases. He gives the example of the Panama Papers investigation when it teamed up with TVNZ and Nicky Hager. They were brought together by the International Consortium of Investigative Journalists and journalists spent a week and a half trawling through the local aspects of the funds incorporated in 21 tax havens. The findings were rolled out on RNZ and 1News.
THE N E W NEWSROOMS
A more recent partnership of local media outlets saw Stuff and Mediaworks collaborate in a documentary series called 'The Valley'. It investigates the New Zealand Defence Force’s 2012 battle in Baghak – a valley in Afghanistan – that resulted in the deaths of two New Zealand soldiers. The Stuff Circuit team behind the series (Paula Penfold, Toby Longbottom, Eugene Bingham and Phil Johnson) won Best Team Investigation at the 2018 Voyager Media Awards. But not only is it a showcase of quality journalism, it demonstrates the new look of journalism. It’s made up of a six-part online documentary, prime-time broadcast documentary, a long-form read, an interactive website and a virtual reality experience. That evolution in storytelling was also realised in the addition of digital and multimedia categories in the 2018 Voyager Media Awards. Best Innovation in Digital Storytelling went to RNZ for its 'NZ Wars: The Stories of Ruapekapeka' web-documentary, Best Team News Video was won by 1News Now’s 'Edgecumbe’s poor flood defences', and Best Team Feature Video was awarded to New Zealand Herald’s 'Under the Bridge' series. This kind of journalism doesn’t come cheap, it takes a long time to create, and it isn’t often that appealing to advertisers who tend to shy away from controversy. So stepping in to provide some support has been NZ On Air, which, according to its Annual Report 2017 had an expenditure totalling $130.8 million in the 2016/17 year. 60.5 percent of that went to national TV, three percent to digital media, 0.9 percent to regional media and 24.9 percent to public radio. Within that almost half a million went to Stuff for 'The Valley' and also for the investigation 'Last of A Few', a short series focused on three Air Force war veterans representing the last of their era. They are just two of a number of journalism projects funded by NZ On Air, including 'The Silence Project' for nzherald. co.nz, 'Hijacked' for The Wireless, 'Frame' for The Spinoff and 'Great South Stories' for Newsroom. While this type of funding can’t sustain a commercial media business, these digital journalism projects are helping to push journalists in new storytelling directions and for Stevens, all it takes is a look around the Stuff newsroom to see how the skillsets of journalists have changed since the days when writing was the key skill. “When I started you needed to be able to write, now we have journalists creating audio for podcast, fronting videos and shooting videos, taking stills, analysing data for data journalism pieces, creating interactives and visualisations of that data and writing stories.” With such variety, it’s undoubtedly an exciting time to be a journalist. But it’s also a scary time. Editorial budgets have been continually cut as companies look for cost savings and, with the appeal of big salaries in PR and comms roles, many journalists have left of their own volition. Mediaworks’ chief news officer Hal Crawford sees some hurt and anger among some journalists who are resistant to the changes being forced upon them. “People take justified pride in skills they have maintained over years and it is very alarming for individuals to find that those skills are no longer valid or they no longer add value in different environments.” He says being resistant to the change and unwilling to move beyond a fixed skillset is not a good mindset anymore. On the flip side, those who are willing to keep learning will find themselves in a better space to get better results as a journalist. “That attitude is the key to riding out the anxiety.” However, it doesn’t all have to change. As the fake news saga has brought to light, the importance of journalism and the fundamentals of its practice remain the same. “So much has changed but those fundamental pillars of journalism haven’t and can’t and won’t change – fairness, accuracy, balance and that term ‘keeping the bastards honest,” says Stevens. Gillespie agrees, and when reflecting on the pace of reporting on digital he says “if you are first and wrong, you are still wrong, you are not really first”. But it’s probably RNZ’S Thompson, a man at the helm of a media company that is likely to receive additional government funding and is in what many now see as a luxurious position as a totally non-commercial broadcaster, who best sums up the future of journalism when he compares cockroaches to journalism: “We may get bombed occasionally but we do survive.” Despite the numerous commercial pressures and existential angst in the news media business, everyone is hoping that the truth will continue to set them free.