On The TVNZ/RNZ Merger Battles

When the baubles of office got handed out last time around, it is hard to understand why anyone picked Willie Jackson to be the ideal person to explain and defend the TVNZ/RNZ merger. For years and well before last Sunday’s fractious Q&A interview with Jack Tame, it has been obvious that Jackson’s skills as a communicator only range from “You like me, right?” to “Hey bro, why don’t you like me?”

Alas, as Tame pointed out several times, it is trust – not likeability, or good intentions – that is the issue here. Can the public really trust the politicians to foster independence when the new and centralised structure being rammed into place by March 1st 2023 will be much easier to control; either directly, or by turning the funding tap on and off.

Allegedly, the realities of the digital age mean that only a merger will enable state TV and radio to achieve the economies of scale that will (cross fingers) enable them to survive and thrive. United they stand - but if left separate, RNZ could conceivably “collapse” if you can believe PM Jacinda Ardern. (In reality, RNZ could collapse only if the government of the day allowed that to happen.)

Hmm. A not-for-profit news generating radio network fused with its profit-seeking TV sibling and with both of them increasingly reliant upon TV’s declining ad revenues… What could possibly go wrong? Judging by the digital offerings evident on the websites of TVNZ and RNZ, it is hard to see how and why a merger would magically improve those digital outcomes. (It could even make digital matters worse).

Supposedly though, a merger is being claimed by Jackson and his Cabinet colleagues to be the only option available to state media as it heads off down the digital highway. En route, as Tame pointed out, the public isn’t getting enough transparency about the mechanics of the merger to feel re-assured that all this is going to end well.

The older, whiter audience that holds RNZ dear to its heart probably have good reason to feel anxious. Were other options fully explored? You’d think that a bigger, centralised entity might not be the most nimble instrument for reaching niche and neglected audiences. Instead of a merger, a separate digitally based entity tasked with reaching those young, brown, and LGBTI audiences might have delivered better outcomes, less controversially - and perhaps at roughly the same extra cost of $109 million annually. Just saying.

Taking on Facebook

Trust can be a delicate flower. On Q&A, Jackson’s petulant attacks on Tame were a classic example of the way that some politicians seem hard-wired to punish the messenger whenever they’re put under pressure, and are failing to perform. That’s why people feel queasy about the merger, despite its avowed good intentions. More centralisation = easier intimidation.

Reportedly, Jackson’s sulky responses to Tame also spoiled the “good news” story that the government had come to tell. New Zealand appears to be lining up to follow the example set by France, Australia and Canada whereby Big Tech companies such as Facebook and Google are legally required to compensate traditional news organisations for use of the news content carried on their platforms.

IMO, this enterprise has more in common with a Mafia protection racket – pay up, or else something bad might happen to you - than with action to right a demonstrable wrong. Yes, thanks to technology and thanks to simply being smarter operators, the likes of Google and Facebook have eaten the advertising lunch of the old media companies. Whether Big Tech should therefore be compelled to pay the losers an annual support sum in compensation though, is something else again.

Spinoff recently defined the current plight of the traditional news organisations “which used to have a near-monopoly on attention and advertising, and are now in a losing battle for both.”

The winners are tech platforms which aggregate content from all around the world, and distribute advertising alongside it with few of the regulations which govern more conventional media in New Zealand. Alongside this, because the audiences deserting radio and television are much more likely to be young, Māori, pan-Asian and Pacific, there is a core unfairness to taxes funding media like RNZ, which largely serves older Pākehā audiences.

Right. But can shaking down the tech platforms for extra cash to prop up old media’s failing business model (a) be justified and (b) be likely to improve the news outcomes for anyone? Moreover, there seems to be little recognition of the fact that when Facebook/Google do link to traditional news outlets, this drives audiences to that content and to websites that the audience would not be frequenting, otherwise. As things stand, internet companies are being forced to funnel money to news organisation owners for the sin of… Sending them traffic.

If we’re talking about trust, can we trust the traditional media companies to take the money they receive from this measure- basically, it's a link tax – and channel it into the most worthy and neglected forms of news gathering? We have yet to see the mechanisms to ensure that virtuous outcomes from the Big Tech subsidy actually do materialise.

France was one of the first countries in which the tech companies bowed to pressure to pay for news. In this part of the world, Newscorp picked up the idea and ran with it. When Google and Facebook initially threatened to block and drop all Australian news and searches from their platforms, Rupert Murdoch’s friends in the Morrison government stepped in to back him up.

At the time, Facebook and Google were facing bigger fears at home, where US lawmakers like Amy Klobuchar had been threatening to invoke anti-trust legislation to break them up. For this reason among others, Big Tech offered an amount to simply pay off Murdoch and other major news outlets. If this process ended up looking like a classic example of crony capitalism in action, then that’s because that’s exactly what it was.

In New Zealand’s case, Jackson told Tame that collective bargaining by the traditional news outlets with the tech platforms will be an important feature of what is being proposed here. This would allow recognised news organizations (primarily that will be the old media club, plus the Spinoff and a few chosen others unlikely to include – full disclosure – Scoop) to join together to negotiate collectively with the tech platforms. If the legislation being proposed here follows the North American models… If and when negotiations break down over the due amount of compensation, the issue will then go to compulsory arbitration for a binding decision.

Not only will the tech companies be unable to refuse to pay… Presumably, there will also be measures to prevent them from taking retaliatory action, by refusing to carry certain news content. If so, it will be interesting to see how the legal provisions to prevent retaliation (i.e. forcing the platforms to carry content) co-exist with the reverse pressures on the platforms to be more proactive about not carrying “objectionable” content.

But to go back to the issue of trust. Why, one has to ask, is the government currently so keen to enact a link tax and take on Big Tech on behalf of the traditional media companies when it seems so very reluctant to raise taxes in order to benefit ordinary citizens?

Keep in mind that this same government has been dead set against enacting a wealth tax, or a windfall tax on profits, or a meaningful capital gains tax to deter property speculation etc. Not to mention the same government’s reluctance to take on the banks, or the oil companies, or the supermarket chains over their excessive profits, as the champion of ordinary consumers. What could a Labour government possibly stand to gain from going to bat so bravely and selectively on behalf of the old mainstream media?

Personally, I think it would be great if making Google and Facebook pay more for the mutual benefits they provide was merely the first shot in a campaign to use taxes on major corporations and multinationals as a tool for enhancing wealth redistribution in general. But I fear it isn’t.

It looks more like an attempt by the government to curry favour with the mainstream media by devising a legal mechanism to send more cash their way. By agreeing to be the muscle and enforcer in this protection racket, the government may also be hoping to reduce the need for the state to keep on propping old media up directly, and indefinitely.

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