Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

ComCom went outside its role in rejecting StuffMe merger

ComCom went outside its role in rejecting StuffMe merger, court hears

By Sophie Boot

Oct. 16 (BusinessDesk) - The Commerce Commission overreached its statutory mandate when it rejected a possible merger between New Zealand's two largest print media companies, Wellington's High Court has heard.

David Goddard QC, the media companies' lawyer, said the regulator placed an emphasis on the importance of plurality in media in its decision to reject the merger, as it was concerned it would lead to a reduced number of voices and viewpoints discussing important issues, but that is not within its statutory function under the Commerce Act.

The act is an economic statute concerned with the economic welfare of New Zealanders as consumers, not as citizens, he said.

"Those detriments fall outside the scope of the Commerce Commission's sphere of responsibility," Goddard said. "It has neither the mandate to take that into account, nor the ability to do so. It's not the sort of analysis the Commerce Commission should be undertaking."

Goddard accepted diminishing quality of news coverage would be under the Commerce Commission's remit to consider, but said there would be strong pressures on the merged firm to maintain and enhance the quality of its content in order for it to sustain its readers' attention.

Even if the legislation was broad enough for the regulator to consider plurality in the way that it has, the commission's approach had been "essentially speculative" and not supported by the evidence, Goddard said.

He outlined the media companies' arguments on the three markets which the regulator had competition concerns about - online coverage, Sunday newspapers and 10 community papers where the two companies overlap.

Goddard reiterated concerns about the shrinking advertising market for online news websites, as they struggle with Facebook and Google "eating their advertising lunch", and said it was "not for is to sit in judgement and say consumers should be reading more about Winston Peters and his decision this week and less about the Kardashians."

Social media has led to a radical change in the way most people read news, Goddard said, with many clicking through from their Facebook feed but returning to Facebook after, rather than staying on the news website.

On the prospect of a paywall, which the commission discussed in its decision, Goddard said the regulator had been wrong to find that there was any real prospect of one being introduced on the New Zealand Herald website and not on Stuff.

"There was absolutely no supporting evidence of a New Zealand Herald-wide paywall," Goddard said. "The cost of doing that in terms of foregone reader attention was too great."

Goddard said news media overseas have had unhappy experiences with paywalls, and no organisations would put in place a paywall that cost more in reach than it brought in revenue. If a paywall were put up, such as one for a specialised subsection such as business, it wouldn't result in any real lessening of competition, but would just be a rebalancing of prices, he said.

The case continues this afternoon. Before the lunch break, Goddard said he wanted to play a video to show the court how a modern news consumer reads news, although the Commerce Commission's lawyers intend to argue it shouldn't be shown.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Manawatu-Whanganui Projects: PGF Top-Up To Rural Broadband Roll-Out

The government has effectively raided the $3 billion Provincial Growth Fund to top up the budget for the second phase of its rural broadband initiative, filling in mobile 'black spots' and ensuring broadband is available to marae that don't have access now. More>>

ALSO:

Other Windy Cities: Auckland-Chicago Named A Top 10 ‘Most Exciting’ New Route

The inclusion of Auckland-Chicago on Lonely Planet’s Where to fly in 2019? The 10 most exciting new flight routes list comes just two weeks before Air New Zealand prepares to celebrate its inaugural flight to Chicago’s O’Hare International Airport on 30 November. More>>

Deadly Strain: ESR Ups Its Reporting On Meningococcal Disease

The increasing number of cases of Group W Meningococcal disease (MenW) has prompted ESR to increase its reporting on the disease to the Ministry of Health. ESR has upped its reporting to weekly. More>>

ALSO:

Very Small Things: "Game-Changing" 3D Printing Technology Launched

New Zealand microfabrication researchers Andrea Bubendorfer and Andrew Best, the co-inventors of a new way of fabricating very small things with Laminated Resin Printing (LRP), are part of Callaghan Innovation’s MicroMaker3D team launching the new patent pending technology in the US this week. More>>

ALSO: