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Judge gets Facebook news primer in media merger hearing

High Court judge gets Facebook news primer in media merger hearing

By Sophie Boot

Oct. 16 (BusinessDesk) - Justice Robert Dobson and his self-confessed "Luddite ways" was shown how news can be shared via social media during day one of Stuff and NZME's appeal against the Commerce Commission's rejection of their planned merger.

The video demonstrated how people can see and share news on aggregator and social media sites such as MSN News, Google News, Facebook, Twitter and Youtube.

The Commerce Commission's lawyer James Every-Palmer opposed the video being shown as he said it demonstrated idiosyncratic behaviour and wasn't representative of a normal social media feed, as the Facebook and Twitter accounts shown had no friends and only followed media companies' profiles. The media companies' lawyer David Goddard QC argued that the video was intended to demonstrate the mechanics of how news works on social media and was not supposed to be representative of a normal user experience.

Justice Dobson said he was unfamiliar with Facebook, and lay member Professor Martin Richardson, professor of economics at ANU, said he only used his Facebook account to keep up with his children, so the judge ruled he would see the video as an aid to Goddard's submissions. The Commerce Commission will be able to argue against what was shown in its submissions.

Goddard showed the video after he argued that media companies are in a Faustian pact with social media platforms, particularly Facebook, as they need to have a presence and publish their stories on those platforms in order to be visible to more readers, but the platforms capture the advertising revenue and marketing data as users don't click through to the news websites.

NZX-listed NZME and Stuff, the recently renamed New Zealand arm of ASX-listed Fairfax Media, applied to merge in 2015, arguing the downside of more concentrated local media ownership would be offset by the merged entity's greater ability to survive the global competition for local advertising dollars caused by the rise of online search and social media giants such as Google and Facebook.

In May, the commission concluded the merger would have too detrimental an impact on media 'plurality' - the number of competing sources of reporting and opinion that it argued was essential to the media's role as an important element of a well-functioning democracy. Fairfax and NZME filed their appeal later that month, claiming the regulator was wrong in fact and in law in rejecting the merger.

The appeal was set down for a 10-day hearing in the Wellington High Court from today.

(BusinessDesk)

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