Richard Harman: Advertising calls the shots

It's easy to understand the reasons why the so-called eminent persons have signed the letter wanting an ad-free public service TV system.

But what those who signed this proclamation do not understand is the way things work now. They thus leave themselves vulnerable to being dismissed as elderly elitists.

Because most free-to-air TV is ultimately funded by advertising, it is the media buyers who call the shots.

What the media buyers apparently want is eyeballs belonging to people aged under 54.

Even TV One's target audience is under 54. That leaves out an awful lot of people.

Statistics New Zealand figures show that at the end of 2004 almost 900,000 New Zealanders (22 per cent of the total population) were over 54.

It is no use blaming the broadcasters for this situation. It is the advertising market that determines which viewers have value and which do not.

The question that those who inquire into TVNZ should be asking is how - or even whether - free-to-air broadcasting should be structured to serve this audience.

Those who defend the present structure present two arguments.

One is the technological argument that TV programme delivery platforms are changing so greatly that it won't be too long before the free-to-air TV model is redundant anyway.

The other is that NZ on Air fills the gap by subsidising broadcasters who want to make what might otherwise be uneconomic local programmes.

There is some truth in both arguments. But they are not the whole answer.

Television futurists, such as David Elstein in Britain, argue that with technological change, TV broadcasting will become analogous to the print media.

He suggests that we will simply move to a subscription model - paying for each programme that we watch whether we see it on a TV set, a broadband computer, or even a cellphone.

We have the beginnings of such a market with Sky.

But what Sky in New Zealand has conspicuously failed to do is commission any local programming of note, except sports.

We do not have a New Zealand equivalent to America's HBO channel to commission groundbreaking drama and documentaries.

Sky might argue that NZ on Air's failure to allow it access to its funding is partly the cause of that.

They have a point. And now, because they own Prime, a free-to-air channel, they have a chance to show us what they can do with that funding.

But the problem with NZ on Air funding is that it simply pays for the programme. It does not address the revenue side of the ledger.

So even if Prime were to access NZ on Air funding, the pressure on what they commissioned and when they showed it would be exactly the same as on the other free-to-air broadcasters.

They too would be up against the under-54 advertising paradigm.

The irony is that the present TVNZ model is about as close as you will get to actually answering this question.

It just needs tweaking.

The problem so far has been that no effective way has been developed that allows the same valuation system to be applied to both the commercial and non-commercial programming that TVNZ might broadcast.

If there were, there would be inevitably be internal incentives inside TVNZ to commission and schedule a broader range of programming in prime time.

That doesn't mean TVNZ needs to be overcome with the kind of tired old programming that those who admire the BBC would probably prefer.

There are plenty of dynamic mixed public/advertising models around - Channel 4 in Britain, or the RTE channels in Ireland for a start.

It is not an answer to this issue to come up with unrealistically expensive BBC or ABC (Australia) models. We do not have the same population as Britain or Australia and Sony TV cameras cost as much in Auckland as they do in London.

We already have the makings of a system that, given half a chance, could work.

But to make that happen will require a more sophisticated analysis than we have seen so far from either the self-proclaimed eminent persons or other commentators.

* Richard Harman has been a TV journalist for 28 years and heads the independent production company, Front Page Ltd, which produces the Agenda current affairs show.