Why media diversity matters

A new report on New Zealand media shows how dominant the two biggest news publishers are in a small market, despite new digital voices. As those two companies await the green light to become one giant news producer, Tim Murphy looks at one small area of news that is already homogenised.

Tomorrow, the results of the latest commercial radio ratings survey will be released showing how many people listen to whom on the talk and music networks.

In regional towns around the North Island and in Auckland, one player in the radio industry, NZME radio, will appear to have done particularly well. Its stations and stars will be the headline acts in news coverage and their increases in audiences, market share and time spent listening will be celebrated. A sampling of the tone and coverage from the second and third ratings surveys for this year, which came out in July and September underlines NZME's omnipresence.

The bigger contender in the market, MediaWorks radio, has to take its chances. Despite having the station with the biggest national audience, The Edge, and More FM and The Breeze in the top five, it runs into a problem.

Its competitor, NZME, also owns a newspaper chain - the New Zealand Herald plus five regional centre papers and syndicated stories in other titles. Its coverage of the radio stories each quarter is uniformly upbeat and positive, about NZME stations. The bare minimum results are mentioned for its radio business's competitor. While it is not atypical for competing media to cover themselves rather than competitors, it is pretty systematic and shameless for the radio surveys.

MediaWorks has no newspapers. Which is too bad for its radio stations. Its results receive a straight report by the other big newspaper company Stuff.co.nz (Fairfax NZ) and in some of its constituent newspapers, but Fairfax has no reason to push either radio company's interests over the other. MediaWorks does own a television network, and cross-promotes its stations in advertising terms but not explicitly in any news coverage.

First World Problem, you might think. Of course you would push your own brands commercially if you have the chance.

Consider this, however. If, as is possible, the High Court agrees to allow NZME and Stuff to merge as a result of the companies' appeal against the Commerce Commission denial of their marriage plan, here is one small segment of editorial content that could be delivered to the entire country via one, commercialised lens.

Every town from Northland to Southland could run a story lauding the local NZME radio station and its triumphs against the local Edge/Breeze/More competitor.

It is hardly political bias, or the favouring of certain segments of society over another. And it could be argued that readers are used to the daily NZME radio bulletin board on nzherald.co.nz for news about hosts like PJ and Jase or Toni Street or someone, someone and someone.

But the low-level demonstration of commercialised judgment, of advancing business interests in editorial content is something editors up and down the country have tried to battle for decades. What should the reader take from such news reports? A full and fair view of, in this case, how the radio station they listen to has performed - or a marketing spiel?

The latest analysis from AUT's research centre for Journalism, Media and Democracy, says StuffMe (as the proposed merged entity has been known) would have a combined market share of 89.3 percent of the newspaper market, with Dunedin's Allied Press holding 8.4 percent.

A table in the report from SimilarWeb analytics shows that between May and July this year, Stuff had 87 million total visits to its website, nzherald.co.nz 63 million, TVNZ 19.4 million, Newshub 8.7 million, The Spinoff 3.7 million and this site, Newsroom.co.nz 605,800. Combined, the StuffMe sites had 150 million visits and the rest totalled 32.4 million. That's five-sixths of the audience.

It has previously been noted that if the two companies' newsrooms are allowed to combine they would have three times the number of journalists of the next biggest newsroom, TVNZ.

The JMAD report quotes the Commerce Commission finding in May that the merger would "concentrate media ownership and influence to an unprecedented extent for a well-established modern liberal democracy" and that by influencing news and political agendas, the merged company created "a risk of causing harm to New Zealand's democracy and to the New Zealand public".

JMAD quotes a Herald editorial disagreeing with that premise, saying newspapers "are not in the business of pushing their own views".

The market awaits the High Court's ruling on the appeal. There is speculation in the industry that Justice Robert Dobson could choose to send the matter back to the Commerce Commission to take further account of matters raised by the StuffMe companies. It is possible, if he were to allow the merger, that the Commission could appeal again to a higher court if given leave, stringing out an 18-month-long process still further.

(The merger bid has gone on so long that Stuff (Fairfax) lost a chief executive, with Simon Tong lured to ASB Bank, and this week NZME lost its chairman, with Sir John Anderson retiring no closer to forming the big NZME joint company.)

JMAD's report says the NZX-listed NZME was 85.6 percent owned by eight substantial shareholders, who were all financial institutions in 2016. But that figure had increased to 96.6 percent this year. The biggest is the NZ Central Securities Depository Ltd, with 15.7 percent.

Stuff's owner, Fairfax Australia, has three big financial institutions as its leading shareholders on the ASX with Ausbil Investment Management the largest at 8.8 percent.

While Stuff and NZME await their appeal, the JMAD report has charted "a considerable shift in the pattern of NZ media ownership. For the first time in seven years, the number of privately/independently-owned media outlets exceeded the number of publicly (shareholder) and Crown-owned companies".

It counts seven privately-owned media companies - Business Desk, NBR, The Spinoff, Allied Press, Newsroom, Bauer Media and MediaWorks - against five listed or public owned - NZME, Stuff, TVNZ, RNZ and Māori Television.

The report concludes, however, that "it would be foolish to think that the NZ media market has changed materially. The commercial newspaper publishers NZME and Fairfax, continue to dominate in print and online news markets. NZME and MediaWorks continue to have a duopoly in the radio market and commercial television broadcasting is still in the hands of TVNZ, MediaWorks and Sky TV."

For the radio market, the JMAD report notes that "every time GfK releases its radio ratings, both NZME and MediaWorks declare themselves as winners". That, however, is in the two companies' own press release and marketing spiel. In the news reports, integrated interests mean NZME has an unassailable print and digital advantage.

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