TVNZ-RNZ merger: Simon Power’s message to Government, advertisers as uncertainty hangs over state broadcaster

The future of TVNZ looks quite different. Photo / File

OPINION:

TVNZ boss Simon Power is a man in limbo, existing between the world that was and the foggy landscape ahead.

In his first – and ostensibly last – showcase address today for the organisation that will soon be formerly known as TVNZ, Power addressed that uncertainty that everyone has been speculating about for months.

The showcase event has always been seen as TVNZ’s opportunity to hype up the advertising community with a steady announcement of new shows – and there was some of that.

But there was no escaping the uncertainty that hangs heavy over everything TVNZ plans to do.

What will the advertising mix even look like when TVNZ and RNZ are merged into a single media beast? How much room will there be for the advertisers that have long propped up public broadcasting in this country? And how much of this will come to fruition given the legislation hasn’t even been finalised yet?

From the outset, Power made it clear that he had two audiences in the room: advertisers and the Government.

Broadcasting Minister Willie Jackson was in attendance, watching the grand procession unfold - and no doubt passing his own judgments on what he saw.

Jackson has, of course, made no secret of the fact that he believes that TVNZ will need to change once it comes under the Aotearoa New Zealand Public Media (ANZPM) banner.

Power thanked Jackson for attending, and it didn’t take long for him to turn his attention to the prospect of the merger.

“While the details are still being determined by working groups that include TVNZ representatives, the provision for mixed funding to underpin the new entity is very clear: commercial income and government funding will both be needed,” said Power in a message clearly aimed at the nervous advertisers who still have questions about commercial imperatives for ANZPM.

“I have no doubt the new entity will provide, as TVNZ does now, a home for businesses to build their brands and promote their products and services,” Power continued.

“This is one of the key contributions we can make to ensure the new entity is well-resourced, competitive and delivers what Kiwis want.”

Easing the concerns of advertisers has to be a priority for Power at the moment. Advertisers simply don’t like uncertainty. They want to be able to plan campaigns in advance to ensure they land with the most impact.

Given how important advertising revenue remains to TVNZ, this won’t be the last time that Power reassures brands that they will continue to have a role to play at TVNZ.

One need only look at the exodus of key advertisers from Twitter to understand that advertisers will quickly pull the plug if they feel even slightly uncomfortable about what they’re seeing. Power will want to avoid this fate and ensure that nerves – or sentiment – don’t erode the advertising revenues at the broadcaster.

As the speech went on, his attention turned to Jackson – and more broadly the Government.

“In my experience, ensuring the effective delivery of public policy requires a sophisticated and nuanced approach,” he said.

“A broad and blunt approach only works if the detail and the implications of the policy are fully understood and appreciated.”

TVNZ chief executive Simon Power. Photo / Supplied

Power was one of the first people to criticise the Aotearoa New Zealand Public Media bill as a piece of “poorly drafted legislation” and the comments made at the showcase could be seen as building on those criticisms.

Power urged the Government to take on board the suggestions from stakeholders across the media sector, who have made submissions in response to the legislation.

“It is easy to see questions, feedback and alternative suggestions as a negative, but in order for a well-thought-out policy to endure it must set up an operating model that will succeed once legislative discussions are completed and those involved in legislative design have moved on to the next task.”

Power is speaking from a position of experience here. In his time in Parliament as a member of the National Party, he was involved in the preparation of dozens of pieces of legislation. He knows what it takes to produce something that’s actually practicable.

And while he did choose his words carefully, the former Cabinet minister is encouraging the Government to take careful cognisance of the unintended consequences that might emerge if legislation is left as simply a “broad and blunt” instrument.

He would not have chosen these words lightly – and they come in the context of a Government that hasn’t always taken industry advice on board – the best example of which would be the changes made to the Credit Contracts and Consumer Finance law.

Despite warnings from the sector that the changes would affect first-home buyers, the Government pushed ahead and only ordered revisions once those unintended – albeit foreshadowed – consequences materialised.

Warnings of unintended consequences with the media changes aren’t limited to TVNZ boss Simon Power.

Stuff CEO Sinead Boucher has warned MPs that the combined entity could have too much bargaining power when it came to securing staff.

“In some cases, the salary offers have been 30 per cent above what we have been paying and what we are paying is very much the market rate - not low paying, so we are already starting to feel the effects of it and the entity is not even formed,” she said.

NZME managing editor Shayne Currie has argued that the merger could have “distortionary effects” on commercial players in the market and that the Government needs to assess the impact these might have.

MediaWorks CEO Cam Wallace also weighed in, saying the dual-funding model would give the entity the best of both worlds and potentially create circumstances allowing what would be the country’s biggest media provider to offer “predatory pricing” for advertising.

And Spinoff founder Duncan Greive worries that ANZPM could have too much power when it comes to commissioning new shows.

These criticisms span the political spectrum and come from those who have first-hand experience in what it takes to run a media organisation in New Zealand.

This is not to say that each of these concerns will materialise in the way that these competitors imagine, but the Government should heed the warnings at the very least to avoid doing more damage to the media and advertising sectors.

The prospect of the merger is already giving opposition politicians enormous ammunition to attack the Government’s priorities. Should Labour march on and make a mess of it, those criticisms will only become louder.