MediaWorks Has A Hissy Fit, The Public Yawns

As TV Three warns it might pull out of television locally, PAT PILCHER takes a look at the NZ media-scape, how it got in its current state and what might lie ahead.

A few weeks back, TV Three owner, MediaWorks, threw their toys out of the cot and told the government that they might pull out of television if media policies don’t change.

MediaWorks told a ministerial advisory group that if “structural anomalies” were not sorted out, the government may become the only broadcaster in New Zealand.

The letter containing the dire warning of a dystopian New Zealand media scene was sent to the ministerial advisory group by MediaWorks CEO Michael Anderson and chairman Jack Matthews back in April.

Could it be that MediaWorks are admitting that state-funded media is killing private sector commercial media? The reality isn’t as clear-cut as many may think.

In their letter to the advisory group, MediaWorks said that government and privately-owned free-to-air television channels now accounted for less than half of television viewing.

In TV Three’s case, I’d wager that there are good reasons for this. Three has spent years inflicting viewers with a frankly dire combination of low-rent reality TV, tired current affairs shows, both of which are punctuated by adverts that give new meaning to the words “this is rubbish tv”.

I’ve written at length about how trashy TV has become in New Zealand. Sadly, TV3 seems to be leading the charge.

Instead of bitching to a ministerial advisory group about how dire the future of broadcasting looks, we suggest that MediaWorks management team and programmers spend some time looking at what viewers want, rather than what is merely cheap and easy to make.

I don’t know about you, but if I must choose between yet another episode of desertislandblockmasterchefhousewivessurvivor or a DIY root canal surgery session sans anaesthetic, I will choose the latter.

MediaWorks may have done themselves and their viewers no favours, but their woes are also due to technology-driven pressures. Netflix, Amazon, YouTube and a bunch of other online video services have a growing following in NZ.

Being US-based, they have deep pockets and can offer a depth and breadth of content that no Kiwi broadcasters could ever hope to match. Add to this the rise in the number of Kiwi homes with ultra-fast broadband and smart TVs, tablets and other digital doodahs and there’s little reason to watch this reality TV garbage.

In short, a perfect storm of technology has caught up with the arrogance of MediaWorks TV business, and viewers have voted with their feet.

TVNZ has played a slightly smarter game. They’re banking on more locally made content – shows that cannot be sourced from Netflix to maintain viewer numbers. TVNZ has also avoided wall-to-wall reality shows, which has probably helped somewhat. I just wish they’d set some standards for adverts which are sadly as trashy as those on Three.

As fun as it is to bag the god-awful viewing experience that is TV Three, the reality is that should MediaWorks deliver on their threats, NZ will be worse off for it. Losing a TV broadcaster is never going to be a good thing, even if Three only have themselves to blame. They’ve seemingly ignored changes to the market and persisted in ploughing on with content that viewers love to loathe. Their woes are not due to “structural anomalies” but poor programming choices and a strategy aimed at profit maximisation of viewers.

With online alternatives from offshore able to produce exclusive high-quality content and state-funded media looking to create relevant and engaging local content, Three now run the risk of being left without a viable niche to engage and entertain viewers.

All of this aside, New Zealand’s media-scape is currently in a precarious position. Perhaps fully aware of this, MediaWorks have timed their threat particularly well.

Across the ditch in Antipodean little America, also known as Australia, Fairfax is about to be acquired by Channel 9. If the acquisition gets approved by the ACCC, rumours have it that Channel 9 will review their New Zealand operations.

Fairfax has already shut down a slew of community papers and slashed staff numbers, so it’s fair to say that their New Zealand operations are already running on the bones of their metaphorical arse. Should Channel 9 decide to sell Fairfax, will a buyer emerge who is prepared to pay what Channel 9 consider a fair price for such a dysfunctional train-wreck? If not, the odds are good that Fairfax’s flagship publication, Stuff, could, in fact, find itself well stuffed.

Given the role of media in a broader societal sense is to act as the fourth estate and to hold those in power to account, the health of New Zealand’s media landscape takes on a higher level of importance.  Then there’s the cultural aspect. With New Zealand already awash in a sea of Australian, UK and US content, the other and equally important role of NZ media is to provide a local Kiwi voice that reflects and represents the culture of New Zealanders.

With MediaWorks threatening to exit TV and Stuff potentially about to get stuffed, New Zealand’s future media-scape could quickly become a whole lot less diverse than it currently is.

We may soon find that New Zealand’s only major print media outlet is Auckland-based – just like our major broadcasters. If future media ends up consisting of Auckland-centric content, much of New Zealand will find itself left without a voice. TVNZ and RadioNZ are already representative of New Zealand in name only. Most of their editorial decisions get made in Auckland. This influences which stories see the light of day. The net result is a lack of coverage of anything south of the Bombay hills.

Ideological, social and cultural arguments aside, the cold hard reality is that money talks or MediaWorks walks. MediaWorks is still losing money, even if they’ve managed to shrink their losses.

In their letter to the ministerial advisory team, MediaWorks argued that independent media was vital to “a well-functioning democracy”. They say that the Government should turn TVNZ’s One into a public-service channel, as an alternative to funding an RNZ television channel. I suspect that in addition to weakening state broadcasters, they’d also like to see what they call “structural anomalies” resolved with a healthy dollop of taxpayer money, too.

The reality is that the internet, social media and services such as TradeMe have been steadily hollowing out advertising, the lifeblood of media. In a small market like New Zealand, this affects everyone. Virtually all media outlets including NZME, Sky Television and Fairfax have experienced revenue declines of between four per cent and six per cent in their most recent annual results. Short of some fundamental innovation, this situation doesn’t look set to be resolved any time soon.

Broadcasters who fail to develop a compelling point of difference from the online streamed content available from the likes of Netflix and Amazon and find a way to generate revenue beyond a shrinking advertising dollar, could struggle to survive. State-funded media may be able to weather the storm by producing local content, but the situation is significantly less clear for private sector players like MediaWorks whose profit motivations mean that anything beyond the cheap to make reality shows is unlikely ever to happen.

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