Commission gets it right by declining NZME/Fairfax merger

By   /   May 4, 2017  /   3 Comments

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This week New Zealand Commerce Commission released its final decision to refuse the proposed merger of two of the countries biggest newspaper networks: NZME and Fairfax. This is a decision worth celebrating, as the proposed merger would have seriously weakened an already diluted quality of news and diversity of voices in New Zealand media.

This week New Zealand Commerce Commission released its final decision to refuse the proposed merger of two of the countries biggest newspaper networks: NZME and Fairfax.

This is a decision worth celebrating, as the proposed merger would have seriously weakened an already diluted quality of news and diversity of voices in New Zealand media.

The commission, in their deliberations, correctly recognized that the merger would allow a single entity to have unprecedented control over the direction of news and political agenda in New Zealand, causing serious harm to the health of our democracy.

Although the Commission did not publish the details of the submission they received from NZME and Fairfax, they did say that, following the commission’s draft determination, NZME and Fairfax had substantially altered their analysis of the sate of the market without the merger. No wonder the commission thought the scenarios presented by NZME/Fairfax were not “likely outcomes”.

The commission accepted that the merger could extend the lifespan of some newspapers and could bring financial savings of up to $200 million over five years, but they disagreed that these benefits outweighed the harm that would occur if the merger was to proceed.

Here is what the Commission Chairman Dr Mark Berry had to say:

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“The merged entity would have direct control of the largest network of journalists in the country, employing more editorial staff than the next three largest mainstream media organisations combined. Its news media business would include nearly 90% of the daily newspaper circulation in New Zealand and a majority of traffic to online sources of New Zealand news. Including its radio network, the merged entity would have a monthly reach of 3.7 million New Zealanders.”

</blockquote>
The Commission correctly recognised it could not simply rely on promises made by NZME and Fairfax to maintain plurality and quality. This is true because these newspaper networks are primarily profit-driven companies, and therefore slaves to financial realities of the market in which they operate.

The Commerce Commission got it totally right by refusing to put financial profit before the health of New Zealand democracy. Now, more than ever, we need our media outlets to recognise that they need to regain the trust of their readers by engaging us with quality news that matter. A good start would be to recognise that their newsrooms are a sea of white that does not represent the wider society. They also need to ditch click-bait journalism, to value experienced journalists and to retain young talented journalists by paying them more than meagre wages.
Donna Miles-Mojab

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About the author

Donna Miles

Donna Miles is a British-born, Iranian-bred, New Zealand citizen with a strong interest in human rights, justice and equality issues.

3 Comments

  1. I concur, Donna.

    In many ways, New Zealand has made a rod for it’s own back buy permitting two giant media-companies to arise, swallowing up one newspaper and radio station after another. With the proposed merger, we would’ve seen a near-monopoly situation arise with only a few independent metropolitan papers (Wairarapa Times-Age and Otago Daily Times); two TV networks; and Radio NZ.

    How long before TV3/Mediaworks would’ve been swallowed up by this near mega-media corporation? And once TVNZ is privatised…

    If the advocates of the free market think that the merger of NZME and Fairfax would be “good for competition”, it shows the shallowness of understanding of their own ideology.

    Imagine if the State wanted to buy up NZME and Fairfax and merge them with TVNZ into a state-owned media conglomerate. The neo-libs would be howling with mouth-frothing rage.

    (Actually, let’s do it, as an experiment, just to see if I’m right…)

    As with the two supermarket chains (Foodstuffs, and Progressive Enterprises) that have all but created a duopoly in this country, permitting mergers and takeovers is never a good idea. Not from a social perspective. And not from a free market perspective.

    NZME and Fairfax have options. I have a few ideas how they could operate more effectively, without shedding staff, and making their on-line presence more profitable, but, well, fuggit, I’m not about to become an unpaid consultant for them. They’re the bright-eyed businessmen and women with ‘bigly’ salaries; let them figure it out.

  2. Cassie says:

    Something really worth celebrating would be if the Herald offices all disappeared down a giant sinkhole.

    • bert says:

      Agreed. Then we wouldn’t get more shit like this,

      Audrey Young, proudly bought to you on behalf of the National Party:

      http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=11850959

      When Audrey( I love John Key) makes comment:

      “This week Jonathan Coleman’s pre-Budget speech was titled the “social investment approach to mental health”, on the basis that early intervention is important and he is promising more funding for it.”

      it appears Young actually believes that shit! How about saying “election year health bribe by J.C., too little, too bloody late”.

      National know the shit fight they’re in for this year and this whole social investment diatribe being promoted by Young and her ilk really is repulsive. Her writing is like some love scene script out of Shortland Street, hardly any critical thinking involved there.