RNZ and TVNZ merger possible as minister announces approval for business case

Friday, 7 February 2020

RNZ and TVNZ may become one entity if a business case by consultants PwC deem the idea viable.

Cabinet ministers have agreed to move forward with a business case to replace RNZ and TVNZ with one public media entity, Broadcasting Minister Kris Faafoi has confirmed.

The minister announced the plans at the New Zealand Broadcasting School in Christchurch on Friday.

'It's well known that New Zealand's media sector, both public and private, is facing unprecedented challenges with competition from the likes of Google and Facebook, declining revenue shares, and changes in when and how audiences access their information and entertainment,' Faafoi said.

'That presents risks for the future viability of New Zealand's public broadcasting operators, RNZ and TVNZ, and the Government needs to address those risks.'

Broadcasting Minister Kris Faafoi first proposed a new public media entity to Cabinet last year.

* Taxpayers' Union says public media overhaul shouldn't be planned in private

* New details revealed as Cabinet agrees on RNZ, TVNZ public broadcasting decision

* Public media decision hangs in balance after Cabinet call for more detail**

Cabinet has now approved plans for consultants PwC to complete a business case to determine the viability of establishing a new public media entity, he said.

'Final decisions about the future of RNZ and TVNZ will be made once the business case is completed … we need to ensure any new public entity has the flexibility and the strength to meet future change and challenges.'

He expected to receive the business case about mid-year.

Faafoi confirmed the new entity would be funded by the taxpayer and advertising, but said the business case would determine what parts of the new entity were commercially funded.

'Our driving force is to make sure that we do a better job of every taxpayer dollar that is invested in public media,' he said.

'At the moment, we don't think the system is best fit for the next 25, 30 years beyond.'

An RNZ spokesperson said the broadcaster was 'encouraged by the Government's willingness to address the challenges facing all New Zealand media and its acknowledgment of the need for increased investment in a stronger and more sustainable public media entity'.

TVNZ boss Kevin Kenrick also said it was 'encouraging' that Faafoi had acknowledged the challenges confronting local media and was coming up with potential solutions.

'TVNZ will support the minister and officials working on the business case over the coming months to assess the viability of the proposed new public media entity.'

In an email sent to TVNZ sales clients, Kenrick said it was 'important to note that commercial funding is expected to be part of the proposed public media solution'.

He expected future plans would depend on the outcome of this year's general election.

'Our understanding is that if approved by Cabinet, a new entity could be established in 2023.'

There has been speculation about the futures of RNZ and TVNZ since August last year.

In November, RNZ reported Faafoi had presented Cabinet ministers with a proposal to disestablish the two broadcasters and create a new public media entity.

A month later, it emerged there was pushback from Cabinet, with some ministers, including NZ First's Winston Peters, asking for more detail.

Then, last week, RNZ reported Cabinet had been convinced to move forward and had made a 'high level' decision to create a new entity.

Faafoi refused to comment on the leak to Stuff.

The secrecy around the future of public broadcasting has been criticised by lobby groups.

Barrie Saunders, chairman of the Taxpayers' Union lobby group, said a restructure 'should be a cross-party effort, also involving the wider public'.

Better Public Media, a lobby group that argues for more resources for the media, also wants greater public input to the decision, chairman Peter Thompson said last week.

Faafoi said NZ On Air would continue to have an important role in funding local content.

NZ on Air acting chief executive Clare Helm said diversity was a core element of the proposed changes and NZ On Air's contestable funding would remain essential to this.

'We have seen exponential increase in demand on our funds, at the same time as the ability to compete against the global giants has eroded over recent years. The time for more intensive intervention is now,' she said.

New Zealand First broadcasting spokesperson Jenny Marcroft said the party supported Faafoi's decision to commission a business case.

'We need to see what the options are, the design and cost, and the likely timeframes.

'As a former broadcaster myself, I understand that the currency of the media is trust, and New Zealand deserves a media voice that can be trusted, and is independent and fearless. In a media environment that is increasingly dominated by digital platforms, and people receiving their news from dubious sources, it is clear that the future of organisations such as TVNZ and RNZ are preserved.'