There are still some major questions around potential mergers of NZ's state broadcasters. Photo / File
There are still some major questions around potential mergers of NZ's state broadcasters. Photo / File
COMMENT:
The big media stoush this week illustrated that RNZ isn't entirely comfortable with what it could become in the near future.
The taxpayer-funded organisation's series of attack ads aimed at commercial media were almost comically timed, while PwC consultants tinker away behind the scenes to see if there's abusiness case for welding worthy RNZ to its glitzy commercial counterpart, TVNZ.
For some time now, we've been told that this is the solution we've been looking for. It's the thing that New Zealand's media needs to ensure longevity in a rapidly changing media environment.
But is this really the answer? How did we settle on this? And while we're at it, what problems are we trying to solve in joining together two entities that seem so diametrically opposed?
A respected industry source told the Herald this week that it seems as though we've been given an answer before we even know what the question was. It's essentially a structural end-point without any clear indication of whether we could get there through a solid business case, the source said.
It's now been left to PwC to work out if there are enough breadcrumbs leading to the structural solution that would bring New Zealand closer to the public broadcasting structure seen in Australia or the United Kingdom.
The report is due around the middle of this year and will arrive amid the pre-election chaos – which means it might not be a priority to politicians grappling for power.
There's added political complexity, with National already drawing a clear line in the sand and saying it will torpedo any Government plan to merge the two entities.
Even if the consultants give it the thumbs-up, you could still be left with National winning the election and refusing to put the plan into action.
Without strong bipartisan support, the idea could fizz out regardless of what the consultants say. You just need to look at the capital gains tax issue to understand that a Government's convictions don't always deliver the intended change.
There's risk involved with any big shift, and proposing a restructure of state broadcasting is no different.
Get it wrong and you ultimately end up messing with the viewing and listening habits of New Zealanders who have loyally tuned in to their favourite shows for years.
If you thought listeners kicked up an impressive fuss in response to the proposed RNZ Concert changes, wait until you start messing with bigger, more popular channels.
There are also some real commercial risks.
The Government has said there'd be provisions for a dual-funding model that would see the merged entity supported through both taxpayer funds and advertising, but we've been given few details of what this might look like in practice.
Broadcasting Minister Kris Faafoi has commissioned consultants at PWC to look into the business case. Photo / File
This information vacuum has been filled with some outlandish speculation, like the suggestion of de-commercialising one the major TVNZ channels.
The thing about these channels is that they're still largely ad-funded and attract hundreds of thousands of viewers without the need for massive Government spending.
Even if the channels are left purely commercial, it's possible TVNZ may be brought under a tighter content mandate, as seen at RNZ. If that happens, there's no guarantee that the audiences will stay. Just because something is local or targeted at a certain group doesn't mean it will be popular - and that's a problem if you're relying on advertising to fund it.
Make no mistake, advertisers do not care about anything as much as eyeballs. Yes, there are always brand safety considerations in play, but these are irrelevant if no one is watching the show.
If the audience starts to migrate elsewhere, so will the advertisers – placing further pressure on the broadcaster. And which politician would have the gall to dip into public coffers to prop up a struggling TV station, when hospitals need repairs and schools need building?
The other lingering question centres on whether TVNZ and RNZ even want to merge.
On the one hand, you have a commercial broadcaster permanently on the hunt for popularity. On the other, you have a state broadcaster that's always taken the high road and opted for worthier programming.
Both have their strengths, but it's unclear how the cultural disparity between them could be bridged.
A 2003 research paper titled 'Cultural Conflict and Merger Failure: An Experimental Approach' published in Management Science pinpointed cultural conflict between the merging entities as the main reason many mergers fail.
The researchers found that you often have a blame game playing out, with either side blaming the other when things start to go awry.
Given that RNZ is already so willing to throw public jabs at commercial media, you have to wonder what would happen behind closed doors once the RNZ battlers are put in the same room as the highly fashionable suits of TVNZ.
