TVNZ and RNZ merger: why I'm dubbing it 'Ti Kōuka'

Tuesday, 15 March 2022

OPINION: The country’s new public media entity will be “built on the best of TVNZ and RNZ”, Broadcasting Minister Kris Faafoi declared on Thursday, and that leads to a couple of obvious questions.

What will happen to the worst bits of TVNZ and RNZ?

Is there a place for them in the new public media entity too?

Not being facetious, it seems the ‘building on the best’ comment was a glib remark intended to convey a general expectation that the new media entity would be a step forward, and not a hint that any streamlining of the broadcasters’ current activities is planned.

**READ MORE:

* Merging commercial TVNZ and non-commercial RNZ won’t be easy

* Mixed funding model needs much bigger government cash injection

* New public media entity could help non-government owned media, says RNZ boss

* Merging TVNZ and RNZ could be an absolute tragedy, or triumph for broadcasting

* Decision to merge TVNZ and RNZ draws mixed response

**

The line in the statement first announcing the new public media entity that really made me cringe, however, was its headline: “New public media entity to showcase New Zealand voices and stories”.

That sounds like we can expect something like a wall-to-wall Country Calendar; ‘whose story are we going to showcase today?’.

I don’t intend to be mean to Country Calendar, which is an extremely well-produced show, but the success of its particular style of story-telling is the exception in the current affairs genre that proves the rule.

Journalism should be a less passive activity than Faafoi’s language implies. It’s about asking the ‘what’ and the ‘why’, not sitting back and switching on the microphone.

Attempting to discern the ‘what’ and the ‘why’ of the new public media entity is like trying to find the edible parts of a disappointing artichoke.

There must surely be something worthwhile at the heart of it – or maybe not.

Come to think of it, I imagine many people will be getting as tired of reading the term ‘new public media entity’ as I am of writing it.

So since it doesn’t yet have a name, for the purposes of this article let’s call it ‘Artichoke’, or maybe ‘Ti Kōuka’ (cabbage tree) as a local alternative instead.

The small kernel of a definite idea in this still rather unripe project appears to be that a merged TVNZ and RNZ would be able to invest more efficiently in new digital channels as they continue to expand out from traditional radio and television.

Ministers also appear to be assuming that at some point TVNZ will not be able to sustain itself from commercial advertising revenues, so some other form of funding arrangement will eventually be needed regardless.

But beyond the procurement savings and that doomsday scenario, it is hard to tell why this project is being attempted now.

The Government envisages ‘Ti Kōuka’ being a public media entity that is partly funded by commercial revenues, rather than a commercial entity that also sustains a public media function, which is well and good.

But that distinction is more a question of attitude and intent than anything that could be enshrined in the new entity any formal way.

Indeed, the funding arrangements for ‘Artichoke’ would seem inherently less stable and less transparent than those that exist to fund public media today.

Currently, RNZ is funded entirely by a Budget allocation and TVNZ pays its own way from its commercial revenues.

That means there is no hiding if the government of the day puts the squeeze on public media funding, as National did between 2010 and 2017 through an RNZ funding freeze.

Under the new model, some of the public media functions currently provided by RNZ would be funded internally from the commercial revenues of ‘Ti Kōuka’, through TV advertising or by charging people for premium advert-free content services, and that would be topped up by Crown funding.

But the commercial revenues and profits of TVNZ’s television business bounce around a lot from year to year and are hard to predict in advance.

We have seen massive swings in TVNZ’s commercial position in the last few years as a result of Covid, for example.

It might be easier for ‘Ti Kōuka’ to keep its costs and revenues in sync while still having a steady multi-year appropriation if it was able to maintain some sort of decent financial buffer.

But the Cabinet agreed that it should not be allowed to build up “excessive cash reserves” on the basis that would be unfair to non-government-owned media.

So, presumably, future governments will need to anticipate how much commercial revenue ‘Artichoke’ might earn in each coming year and then tweak its Crown funding to compensate for any expected rises or falls, to ensure it can produce a stable amount of programming.

That would seem to give future governments a mechanism to send some fine-tuned signals to ‘Ti Kōuka’ about what they thought of its performance.

From Artichoke’s perspective, its management would start each financial year with a government appropriation, an estimate of the commercial revenues it might earn, and a budget.

The Cabinet paper giving the green light to the TVNZ, RNZ merger states that the new entity “would not be expected to maximise its commercial revenue”.

But unless it could count on some sort of retrospective funding from the government if its budgets went off track part way through each financial year, achieving its commercial revenue targets would surely always need to be front and centre for its management.

The broader question is in what others ways ‘Ti Kōuka’s’ success could be measured. Not by its financial performance, and not in a straightforward way by its audience metrics if part of its job is to cater to underserved audiences, and not by its ability to please the government of day, of course, so what then?

On the plus side, the concern that the new public media entity will prove a behemoth that sucks oxygen away from the wider media sector and reduces media plurality may be overblown.

TVNZ and RNZ have so far failed to really crack the market for online, local news; the market currently mainly catered for by Stuff and NZME.

‘Ti Kōuka’ could perhaps assist by enabling the two services to make use of a common technology platform.

But building critical mass for a completely new online news brand that could offer a good user experience delivering audio, video and text-based news and information may still be a hard or expensive task.

Alternatively, Artichoke could choose to be less ambitious and continue to leverage RNZ and TVNZ’s brands while trying to build out into new markets incrementally.

To tidy up one confusion, the Cabinet has agreed that the legislation underpinning TVNZ and RNZ should be repealed by July next year, when the new entity is intended to be fully operational.

But a spokesman for Faafoi says they could still exist as legal entities beyond that, if they are recreated as subsidiaries of the new entity.

So, it is not necessarily the case that ‘RNZ’ and ‘TVNZ’ are brands that will suddenly cease to exist.

‘Ti Kōuka’ won’t fall flat on its face.

As the pre-eminent state-owned broadcaster it will attract top talent and management and I’m sure put out a good range of news and entertainment programming whatever institutional and funding arrangements are in place.

But its rationale remains poorly articulated.

Perhaps what the Government really wants is for younger audiences and television audiences to be exposed to more ‘RNZ-like’ content. It may be as simple as that.

But if ‘Artichoke’ does force them towards that water, will they drink?

Not if it sets out to “showcase voices and stories”, I reckon.

The public will have the opportunity to offer any dissenting views on the plan and have those views ignored at a select committee later this year.