Stuff chief executive Sinead Boucher taking time over big decisions

Monday, 31 May 2021

It has been a year since Sinead Boucher bought Stuff for a dollar. (First published May 2021.)

A year after buying Stuff for one dollar, owner and chief executive Sinead Boucher has opened up about the welcome and not so welcome offers of support she received and the current state of the business.

Boucher has also cleared up one question about the sale, saying that she herself took on no personal liabilities for the publisher, such as its lease commitments, which instead remained with Stuff itself.

As such, Boucher was effectively gifted Stuff by its previous owner, Australian company Nine, she confirms.

“It really was as simple as that,” she says.

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Sinead Boucher says Stuff has made a profit in its first year under local ownership, at least before any abnormals.

The obvious explanation for such a deal appealing to Nine – aside from the goodwill it will have earned –is that an orderly handover to Stuff’s experienced chief executive would have minimised the risk of any creditors claiming the transfer of ownership was a ruse, had Stuff failed soon afterwards.

Boucher indicates she doesn’t know whether Nine was serious or bluffing when it told the Commerce Commission during the early days of the Covid pandemic that it would wind up Stuff at the end of May last year, if it could not achieve a clean exit.

The threat of closure, if that’s what it was, came at a time when Nine was still hoping to get the watchdog’s approval to offload Stuff to Auckland rival NZME.

“Would it have come to that? Who would know?” Boucher says.

“It may have done because I know they wanted to get out.”

Boucher fears a new public media entity could be able to be commercial when it suited it, and ‘non-commercial’ when it didn’t, posing competition problem for other media.

While Boucher didn’t take on personal financial liabilities in taking over Stuff, the moral responsibilities that came with inheriting the country’s largest employer of journalists seem to have weighed heavily.

She says she views herself as a “guardian or custodian” of Stuff, rather than a media mogul.

“I spoke to different advisers about whether I was doing the right thing by the company by doing this, or whether I would be putting the company into a more vulnerable state.

“And the advice was, given how clearly Nine had signalled its intention, I wasn’t adding any additional risk.”

It is also why one of her first actions was to put in place an editorial charter setting out Stuff’s editorial independence, including from herself, although she concedes “at some point there has always got to be an element of faith in there”.

Since those turbulent times there has been a break in the clouds hanging over the troubled media industry, Stuff included.

Local ownership gave Stuff the freedom to carry out its investigation into its past treatment of Māori.

TV3 and Newshub achieved a Houdini-like escape from their woes last year when deep-pocketed US firm Discovery bought MediaWorks’ TV business.

NZME, which faces essentially the same challenges as Stuff, has seen its market value climb from a lowly $39m to $152m over the course of a year, and Sky TV has shored up its short-term future after shareholders agreed to pump another $157m into the business.

The majority of Bauer Media’s axed magazine titles, including The Listener and North & South, have been resurrected under new ownership since its retrenchment from the New Zealand market.

“Most things have survived or been reborn, we haven’t lost any major players out the industry at all,” Boucher observes.

As sole owner of Stuff, Boucher won’t be under any obligation to make its accounts public.

But she volunteers that the company will record a profit for the year to June, at least before any abnormals.

That is despite an uneven performance through the year and Stuff having to make a number of capital investments, many of which have been related to technology and the separation from Nine.

If Broadcasting Minister Kris Faafoi simply leaves negotiations between internet giants and media businesses to the market, they won’t deliver “fair payments” for journalism. Boucher insists.

In the year to last June, Stuff posted an operating profit of A$28 million (NZ$30m), according to results previously released by Nine.

This has been the first year for perhaps 10 years that Stuff has not reduced the number of journalists it employs, which sits at about 370, Boucher says.

“We did 80,000 stories across the country, most of which will hopefully have had a positive impact.”

Boucher says it wasn’t until after the sale that she started to think about the freedoms that came with the responsibilities of ownership.

Highlights of her first year as owner include Stuff’s apology over the media firm’s past portrayal of Māori, being able to pay back voluntary pay cuts agreed to by staff during the Covid lockdown, and the success of The Press’ “Buy the Hill” campaign to buy 500 hectares near Lyttelton for a conservation park, she says.

“Having the freedom to do those things without having to get them through the lens of an overseas owner stands out to me.”

Stuff’s ongoing profitability has meant Boucher has been able to bide her time weighing up whether to bring new investors into the business.

She recalls that was the advice of entrepreneur Sir Stephen Tindall, one of many well-wishers who called her out of the blue after the sale, to suggest she should not rush into any big decisions.

The Press' Buy the Hill campaign is in support of the Rod Donald Trust's vision to buy Christchurch's highest peak to secure public access and the regeneration of native forest. (First published May 26, 2021)

“We have had an enormous amount of goodwill. There has really been a sense of people wanting us to succeed.”

But Boucher says she also received calls from would-be backers who offered help, but whose agenda turned out to be wanting to “change the government”.

If and when Stuff takes on investment, “we will want to do it because we think it will strengthen the company or open up new opportunities, but at the moment we haven’t had to”.

Listing Stuff is a possibility, but not on the immediate horizon, and it is a case of ‘watch this space’ for word on some form of staff share ownership.

Boucher says Stuff’s stabilisation does not mean everything is suddenly rosy for the sector, either in New Zealand or globally.

“The big macro things that have affected media, such as the shift in digital advertising, are still there.

“But I would say there is more of a sense of optimism about being able to deal with some of those challenges now than there perhaps was a year or two ago.”

In particular, Covid and concerns over the impact of “fake news” have given fresh impetus to calls for the likes of Google and Facebook to chip in meaningfully towards the cost of journalism.

But that's not in the bag.

Google plans to launch its Google News Showcase product in New Zealand this year, which will see it pay mainstream media organisations to supply and curate stories for its app and search site.

Facebook is expected to follow.

But Boucher is adamant that such schemes will only become a mechanism for “fair payment” if the Government follows Australia by forcing the issue under threat of regulation.

“There has been international research that shows Australian publishers were able to secure 10 times the amount in the UK, where some publishers came to arrangements but there was no government regulation.”

Google’s news partnerships director for the Asia-Pacific region, Kate Beddoe, responded that negotiations with potential Google News Showcase partners in New Zealand would be confidential.

She said they would reflect “the global model we use in all countries where Showcase is launching”, including Australia, UK, India and Japan, though Google declined to say what that model was.

Boucher says that so far there has been “no step forward in New Zealand”.

“Google has not entered into any talks with any New Zealand publishers.”

Rather, it is “100 per cent” reacting to pressure from governments, she says.

“If we could have a proper focus on the regulation of internet platforms there wouldn’t need to be taxpayer subsidies for the media.”

While that is a hope to hang on to, Boucher says all of the commercial media have a “degree of alarm” about the touted merger of RNZ and TVNZ into a new public media entity.

Broadcasting Minister Kris Faafoi expects to take a case to the Cabinet for the controversial proposed merger in October.

“It is difficult to see a scenario where a state-funded entity that can be both commercial and non-commercial, perhaps as it chooses, is not a serious threat to the commercial media,” Boucher says.

She assumes the merged public broadcaster would make more of a push into digital and local news, a space occupied by NZME and Stuff.

“I think everyone benefits from a strong public media,” Boucher says.

“But you need to have plurality, diversity of voices and strong commercial media also, and that could really be jeopardised by a push to create some new ‘super entity’.”

As for the factors Boucher can control, she says the company is continuing to consider how to develop its business model.

And, no, that doesn’t necessarily mean a paywall, she says, although she does not rule that out.

“There seems to be a perception we have always been ‘anti-paywall’, which is not the case. We have just looked at different models being suitable for our strategy.

“In future, I think most media organisations will have a mixture of some form of paid content, some free content and some other revenues streams,” she says.

“At some point it is likely we are going to want to bring on other investors or do other things, but those are very considered moves to make.”