Covid-19

A reality TV show where the news media bare all

MediaRoom: Today MPs on Parliament's Covid-19 emergency committee will hear by video link from all the major news media on what might save private sector journalism.

Editors and media business leaders get their chance this morning to make their case to Parliament and the nation for public help to shore up news media stricken by the Covid-19 lockdown and economic crisis.

They'll do so in the wake of Tuesday's announcement by New Zealand Herald publisher NZME that it is cutting 200 jobs and asking remaining staff to take a 15 percent pay cut, and with the aftershocks still reverberating of the sudden closure of Radio Sport and all Bauer's New Zealand magazine titles.

Prime Minister Jacinda Ardern confirmed on Tuesday that a short-term package of 'triage' measures to support journalism through the lockdown downturn, as predicted here, would be forthcoming this week. Many of the same people who will today brief the committee have been in urgently-called video meetings with officials from the Ministry of Culture and Heritage, on behalf of Communications Minister Kris Faafoi, working on rescue measures.

MPs on the Opposition-dominated select committee have a chance to test the media companies' pleas for public funding, reduced Crown charges and regulatory relief. They can also examine if the Government has moved fast enough to preserve a critical element of our democracy, independent journalism.

The timing of the NZME announcement to the stock exchange could not have been more acute.

At the weekend, business leaders were hearing of NZME's dire situation, including the 50 percent reduction in advertising revenue since the Covid-19 crisis began, and weighing requests for investment or purchase of assets.

NZME's near record-low share price bobbed up 1.5c on Tuesday after it announced spending cuts. Photo: Screenshot from NZX

NZME's figure of 200 jobs being eliminated did not mean, as was immediately assumed in some news and social media commentary, that a further 200 currently employed people were about to be told they had lost their jobs.

The NZX statement said the total included unfilled vacancies already in the organisation - which could round up to a sizeable number across everything from radio stations, finance and human resources, marketing, advertising sales, print works, digital teams and the newsroom. A hiring freeze has been in place so a good number of roles would have been sitting vacant. The 200 number would also include completed redundancies from Radio Sport and the Herald's sports department. The company would not say yesterday how many more people would be leaving the business.

NZME will have 200 fewer roles than its possible budgeted headcount. However, in each of the past few years the company has reduced its staff by a significant number, at a cost of millions a year, meaning that even without the Covid-19 crisis a number of the 200 would likely have been going in 2020 anyway. Oddly, the company is going to use the Government's wage subsidy scheme to pay $585 a week through to June 26 to staff whose roles are being made redundant, then pay out the redundancy money from July 1.

NZME will no doubt be quizzed on its financial predicament, and its favoured response from the Government. NZME wants political backing for a relaxation of the Commerce Act to allow it to buy rival Stuff. It failed in a previous application and court challenges, due to the threat to media plurality and diversity. With both businesses now stricken by collapsed revenues, MPs will want to know how joining two damaged companies will lead to one viable one, particularly if some form of KiwiShare condition attempts to preserve journalist numbers and newspaper mastheads.

Stuff is advertising its 'trusted news' and newspaper deliveries on its site.

MediaWorks, which has also sought a 15 percent pay cut from its staff, will front MPs, and is likely to be asked how, with its advertising revenue tanking and staff pitching in with salary sacrifice, it can afford to engage former star host Paul Henry for a new nightly programme on rebuilding the country from the crisis. Henry does not come cheap. MediaWorks talked late last year of closing Three if it could not find a buyer. No buyer emerged before the media world imploded.

As media chiefs explain the value of journalism, and the need for private newsrooms beyond the state-owned TVNZ, RNZ and Māori TV, they will be conscious not to be seen by other business sectors, or the wider public, as indulging in special pleading and elevating their commercial concerns over those of so many other industries. 

Finance Minister Grant Robertson pithily referred on Tuesday to the media sector having had 'underlying conditions' before Covid-19 hit. He might have noted media businesses were getting no pain relief for those conditions from the Government before the crisis, despite repeated calls for help.

Today's hearing opens with former Herald editor-in-chief Gavin Ellis, now an academic and media commentator, setting the scene for MPs of how a media sector already under enormous commercial pressure from digital disruption and global competitors has been affected by the Covid-19 crisis and what needs to be done now.

Media companies appearing before the committee, livestreamed on the NZ Parliament site, from 10 am are: Stuff, NZME, TVNZ, MediaWorks, Maori TV, RNZ, NBR, Newsroom, the Spinoff and BusinessDesk.

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