TVNZ signals further cuts ahead as RNZ promises to be media ‘cornerstone’

Wednesday, 31 July 2024

Television New Zealand expects to shrink further as it shifts its focus from broadcasting to the digital world, its chairperson Alastair Carruthers has told MPs.

After appearing in front of Parliament’s Social Services and Community select committee on Wednesday, chief executive Jodi O'Donnell warned there were “revenue gaps in the next financial year” that it didn’t yet know how to fill.

TVNZ briefed staff on its new five-year “digital plus” strategy in June and O’Donnell said on Wednesday that she informed all its staff then that “in time I would be coming to talk to them around the challenge that we see in our financial performance for the next 12 months in particular”.

“The first conversation I will have will be with our people,” she said, appearing to hint at the prospect of further cuts.

O'Donnell wouldn’t say whether TVNZ was currently reviewing the future of more of its shows, following the cancellation of current affairs shows Sunday and Fair Go earlier this year, saying she “didn’t have anything to share today”.

TVNZ has previously signalled it expects to report an underlying loss of between $28 million and $33m in the year to the end of last month, with the weak economy compounding the longer term leakage of traditional advertising revenues to global internet platforms.

Carruthers didn’t sugar-coat the financial shock TVNZ had experienced, saying its board had been alarmed at a “steep decline” in revenues that began in December 2022.

He indicated that had stopped “in the last month or so”.

But O’Donnell said that while expectations of lower interest rates appeared to be assisting TVNZ, its revenues were still declining, albeit at a slower pace.

“I'd say there's been more of a stabilisation. I certainly wouldn't say that it has returned to growth or that there are ‘green shoots’ yet.”

Carruthers said there “was nothing that felt good” about the cuts TVNZ made earlier this year, but it had “so many challenges in front of us financially” that if it did not start to manage content production in a more efficient and digital way, “you won't have a television station in years to come”.

He made clear he expected the broadcaster to vacate more space in its Auckland headquarters.

“Anybody who has visited TVNZ will see that we've got a lot of space. So we are actively freeing up floors.

“We're quite a lot smaller today than we were a year ago and I think we will become smaller as we go forward and more focused on the digital world.”

O’Donnell believed TVNZ had increased its share of television audiences during the 6pm and 7pm news slot, following the closure of television channel Three’s Newshub and the launch of its alternative Stuff-produced Three News bulletin.

But it was “probably too soon yet” to see if there were any financial returns from that growth, she said.

Despite the financial gloom, questions from MPs focussed in part on concerns voiced by Labour broadcasting spokesperson Willie Jackson that Māori journalists were not sufficiently represented on TVNZ and RNZ in mainstream programming.

Jackson told RNZ chief executive Paul Thompson, who also appeared in front of the select committee, it was “not good enough” there were “no Māori on prime time” — a point contested by Thompson.

Thompson told MPs there was no doubt the media sector was “incredibly fragile”.

“We can take for granted that local content and a vigorous fourth estate that New Zealanders can trust, and a diversity of media sources, is guaranteed unless we do a lot of change,” he said.

“I think the previous government and the current Government are aware of that and have policies in place, but those challenges are incredibly difficult to fix.”

The challenges facing the sector made RNZ’s role within in more important, he said. “We see ourselves as ‘cornerstone’.”

Carruthers said he had particular concerns about people aged under 25 losing trust in the media.

Most under-25 were consuming content that was “borderless” on their phones, he said.

“The question about trust is about how we create relatable content wherever they are, in order to keep them inside the general [sphere] of what we would consider to be responsible current affairs.”