Griffin on Tech: Newshub - disrupted and down, but not out
Most people involved in the media industry expected news outlets to take a haircut in 2024.
But they didn’t anticipate the number one all-over buzzcut Warner Bros. Discovery has proposed giving its Newshub operation, with up to 300 jobs likely to go when the service is shut down in June.
Newshub journalists like Ryan Bridge and Michael Morrah emerged shell-shocked from Wednesday’s all-hands meeting, retiring, as journos do, to Galbraith’s pub near the Newshub HQ in Auckland to commiserate and drown their sorrows.
By Thursday, they were in fightback mode, with Morrah, one of the country’s best investigative journalists, telling the New Zealand Herald that key Newshub staff were to put a proposal to the station’s owners next week to save the news.
So they should. I don’t think Newshub’s days are numbered. The news and current affairs operation undoubtably is responsible for the bulk of the station’s sizeable losses in recent years. But the expensive show The Project shut down at the end of last year and Ryan Bridge’s 7pm current affairs show hasn’t started yet.
Continuation - on a beer budget
As Mark Jennings, 3News and Newshub’s former managing editor wrote this week, there’s an opportunity to reinvent Newshub on a “beer budget”, cutting costs to the bone, asking the Government for a fee holiday on terrestrial transmission costs, and rallying support from advertisers who will be dismayed at the prospect of having only one channel’s news shows to advertise around.
Warner Bros. Discovery doesn’t deserve a government bailout, and nor has it asked for one. But there are things the government can do, such as the transmission fee holiday and through NZ on Air funding of news shows to lessen the pressure on Newshub in what is a very soft advertising market.
However, Newshub’s crisis starkly illustrates the structural problem with media, which have seen their advertising move online and into the coffers of Google and Meta, as audiences ditch linear TV in favour of short-form video content and social media. That is an issue that demands a firm response from the Government, if we actually value the role independent and diverse media plays in a healthy democracy, because user-generated content and Joe Rogan podcasts are no alternative to fully-functioning, independent newsrooms, staffed with experienced journalists.
Despite its lack of enthusiasm for the Fair Digital News Bargaining Bill which was the subject of select committee hearings last week, the Government will need to now pay it fair consideration given the shaky financial state of the media. The news bargaining code in Australia, which requires Google, Meta, and Microsoft to strike deals with news publishers, has been successful, seeing hundreds of millions of dollars shared with media outlets. The code is under review, with A$1 billion in revenue over the next four years if the code is not continued. A move to bring TikTok into the code is also proposed. In November, Google agreed to pay C$100 million to publishers in Canada as part of the media bargaining legislation put in place here.
Equivalent deals with the tech titans might yield $50 million in total here. That’s the difference between newsrooms shutting down or staying in business. It will give them some runway to innovate for the digital age. Warner Bros. Discovery is right to put ThreeNow, the channel’s digital platform at the heart of its future strategy. Compelling news-related products need to be at the heart of that, ones that appeal to younger demographics.
With the precedent set overseas for paying media outlets after a long and hard fight to avoid doing so, tech companies could work more collaboratively with media outlets to grow the pie for everyone. They’ve been doing that on a voluntary basis here already, but the dollar amounts injected have been small.
Challenges, to be sure
There’s a way through the crisis in media, but it requires some quick action, and principled if pragmatic decision-making from the coalition government, which knows that its untenable to have one main English-speaking TV news broadcaster serving the country.
Ireland, probably the most similar media market to New Zealand, is served by the highly respected public broadcaster Raidió Teilifís Éireann (RTE), Virgin Media Television, and TG4, an Irish language public broadcaster, similar in remit to Maori TV.
Virgin Media has a small news operation, anchored by the 30-minute weekday news bulletin that airs at 5.30pm. The station racked up after-tax losses of €6.1 million last year, down from almost €7.1 million the year before, which it blamed on a soft advertising market. But it is staying in the news game and the Irish government has introduced a series of measures to support public interest journalism. Our Government won’t replicate the controversial Public Interest Journalism Fund here, but NZ on Air has successfully funded current affairs shows for years and should continue to do so.
Even the tech titans who flocked to Ireland over the last 20 years, lured by juicy tax breaks, have had to tighten their belts, with the likes of Meta, Alphabet, Hubspot, Microsoft and Amazon shedding 2,300 workers between them in the last couple of years.
Each country has to find its own solutions to the disruption of news media. But the prevailing trend internationally can’t be denied - the wholesale transferral of advertising revenue from media companies to a handful of tech giants. That needs to be addressed if we care about having a plurality of healthy news media outlets.
