Hard News by Russell Brown


NZME and you

When the New Zealand Herald shifted to a new compact format three years ago, one of the key undertakings of its editors was that the printed paper would leave "commodity news" to the 24-7 Herald website and concentrate on developing and delivering its own stories.

It was a good philosophy and it it helped give the reinvented paper clarity and purpose. It made it seem that the people in charge actually wanted to be publishing a newspaper – especially in comparison to Fairfax, where progressive centralisation and sharing of content across titles has had the effect of diminishing the importance of individual mastheads.

But the Herald's publisher was literally a different company three years ago. APN New Zealand is now NZME and it, too, is building a content factory, or as it was characterised in an announcement last Wednesday“world-class integrated newsroom” serving the company's print, radio and digital businesses.

It's this shift, which will be made real when all NZME's media businesses move under the same roof later this year, that is partially behind the shock news that as many as 30% of the Herald's editorial staff may be made redundant. You may have heard that the likes of Michele Hewitson, Brian Rudman and John Drinnan are for the chop, probably along with the staff of Canvas. But there are also many people you won't have heard of – the backroom heroes who make the paper.

The staff either sacked or invited to "consult" on their futures (which basically means they'll be asked to compete for jobs involving more work for less money) are largely over 40, experienced and on decent contracts.

Fairfax, where the Sunday Star Times in particular is feeling more purposeful than it has in a while, isn't looking so bad now.

In part, it's just money: the recent columnist cull at the Herald was prompted by a 20% budget cut. The Herald can't really afford to publish new columnists unless they either write for free or can arrange to be paid by a third party.

But things are more complicated when it comes to the likes of Canvas, which does not lose money – indeed, it's a proper little cash cow, delivering millions of dollars a year in revenue. I'm sure Shayne Currie was telling the truth when he said to NBR that “we have no intention of closing Canvas magazine”. My guess is that resources will be pooled with other supplements in an attempt to generate similar revenue with fewer resources – and, inevitably, less experience on board.

Let's be fair: the Herald has done more in recent years to support investigative journalism than any other news organisation in the country. This week, like every week, you'll read important stories by very good reporters. But the trajectory is away from that and toward the reality that already greets twentysomethings as they come into the news trade via "digital"– high-volume, low-resource content-wrangling.

NBR's anonymous commentator put it more bluntly:

Opines one old hand, who preferred not to be named, the restructure "is an idea dreamed up by desperate accountants who have not learned that synergy only looks good on paper."

"The dedicated brand managers of each title and their expertise will be lost,” they predict. "The internal competition among the journalists for the scoop will be a thing of the past.

"NZME will arrive at a dysfunctional, vanilla, boring newsroom trapped in a 24-hour news cycle without the time or motivation to find real stories."

These are disrupted times. I recently shared a panel with media managers who acknowledged that although the digital momentum was effectively unstoppable, it wasn't clear what would keep up revenue in future. I sympathised with them. I also couldn't help but notice that the representative from NZME seemed to regard the words "content" and "advertising" as interchangeable.

The people running media companies now often do not have media backgrounds. NZME CEO Jane Hastings, for example, is a former SkyCity executive. And although the details of Alastair Thompson's report in April are strongly debated (see responses from Tim Murphy and Colin Espiner), it's hard not to feel uneasy about the the backlash after a Herald business story critical of SkyCity's practices as an employer was published this year. For all the denials, I have been told about editorial decisions being overruled to block sympathetic reports about Mediaworks or its staff, because by sheer commercial logic, they are the competition.

The problem is, if anything, more acute at Mediaworks. A recent report by Nick Grant for NBR claimed that since Mark Weldon took the helm, the profitability achieved in its television division under his predecessor, Sussan Turner, has gone away and the TV business is now "tracking toward a run rate ebitda loss of $15 million a year." (Turner has now been snapped up to serve on the TVNZ board, where they probably can't believe their luck.)

Worse, Grant also claims that offers for the company in the range of $400m early in Weldon's tenure were rebuffed because he had convinced its board that he had a plan that would substantially increase its profitability and hence its market value (which would mean bigger bonuses for Weldon and his board when it was sold). Grant wrote:

Now however group ebitda is understood to be about $20 million and the asking price for Mediaworks is estimated at between $250-$300m.

The poor thinking evident in the launch of Scout does suggest a top management that really doesn't have much grounding in editorial. (It's not that they're doing celebrity gossip, it's the dumb way they're doing it.)

Alastair Thompson wrote in April that what he was reporting:

... goes a long way to explaining why Paul Thompson, the former Group Editor at Fairfax, told RNZ staff last Wednesday that they were very lucky they were working for a publicly funded broadcaster with no exposure to the advertising market.

But it's hardly all dandy there, with public broadcasting entering its eighth year of a budget freeze. The government shows no sign of lifting its sinking lid on the public good. Do more with less is the new normal.

By contrast, I'm told that NZME's executive salary bill has increased by at least two million in the past couple of years. That must grate terribly for the experienced editorial staff who will find themselves with an uncertain future and uncertain prospects of employment. It's cold out here.

Many journalists I know joke grimly about having picked the wrong career. What else do we all do? Will there be a correction, or is this the new reality? Spinoff publisher Duncan Greive's recent "exit interview" with departing Metro editor Simon Wilson is in part a lament for a golden age when Metro could afford to put writers on crime stories (and hence have them sit in court for a month). "It feels like you are describing a fantasy world that I can’t even imagine existing," Greive responds.

Whatever happens, we're all going to have to do a lot more hustling. In which spirit, forgive me if I remind you that you can be a a donor or voluntary subscriber to Public Address. Our crowd income is under $1000 a month, but it really does help enormously in maintaining the site. I'm also grateful to Orcon for its commercial support of IRL at Golden Dawn, which relies on Public Address reach (please, watch the half-hour IRL highlights video, it's pretty cool). I'm going to (finally) sign us up as Press Council members and I'm looking at another crowdfunding model in a meeting this week. I'd like to do more.

In the meantime, if you're after a speaker, chair or moderator, talk to my agent and if you're interested in supporting Public Address with advertising, drop me a line. Now if you'll excuse me, I have some more hustling to do ...

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