8. Dr JONATHAN COLEMAN (National—Northcote) Link to this
to the Minister of Broadcasting
Does he agree with yesterday’s statement by Rick Ellis, Chief Executive Officer of Television New Zealand Limited, that “TVNZ will not return to the revenue levels of recent years any time soon”?
Hon STEVE MAHAREY (Minister of Broadcasting) Link to this
Like all free-to-air broadcasters, Television New Zealand is facing such changes as fragmentation of audience and changes in technology. As a result, it does face some revenue challenges going forward. To address those challenges, Television New Zealand has begun to move into digital, it has moved to lower its costs, it is looking for new ways to source revenue, and it has launched its plan to reach New Zealanders on every screen, as it calls it. The board assures me that it believes that the plan is sound.
Dr Jonathan Coleman Link to this
How does the Minister explain the fact that since he took over the broadcasting portfolio the operating revenue of Television New Zealand has plummeted from $492 million in 2003 to $375 million in 2007—which is a decrease of $117 million, or 24 percent—and why would he think that things will start to improve?
Hon STEVE MAHAREY Link to this
It would help if the member actually did follow trends in broadcasting. For example, if he looked at any market anywhere in the world, he would understand that all broadcasters are facing a shaving down of their audiences—a fragmentation of their audiences. Of course, if the audience is watching 17 channels rather than a traditional two, the broadcaster’s revenue is going to change. It would help if the member actually understood broadcasting.
Martin GallagherAlong with other significant publicly owned broadcasters, such as the BBC, the RTÉ, and the ABC, etc., why is Television New Zealand having to change; and what are the core components of its strategy?
Hon STEVE MAHAREY Link to this
I will answer that excellently insightful question by saying that Television New Zealand, like all broadcasters, is moving from analog to digital. That is happening all around the world. It is having to change because of the change in viewing habits—many people now watch their television on a computer or on some hand-held device. It is having to look at changes, therefore, in its advertising revenue, because of course its traditional source of revenues from ads is beginning to change. Those kinds of changes mean that Television New Zealand now has a plan called Inspiring New Zealanders on Every Screen, which means that in practice it is trying to put its programmes on every screen for New Zealanders to watch. Some of those things have already begun to happen. For example, Television New Zealand has launched TVNZ ondemand; completed agreements with Google, YouTube, and Fairfax, for the use of content; has invested $100 million on top of Government funding in local content; and will soon launch two new advertising-free channels, which will give New Zealanders a whole new era of watching.
Dr Pita SharplesTēnā koe, Madam Speaker. Does the Minister support Television New Zealand’s commercially driven decision to shift the flagship Māori news programme, Te Karere; if so, how will he explain to the disappointed Māori viewers, who were not consulted on the time shift, that Television New Zealand’s charter obligations for a significant Māori voice are able to be met through relegating its key Māori programme to the hours of dawn, midnight, and mid-afternoon?
Hon STEVE MAHAREY Link to this
As the House knows, of course, any Minister of Broadcasting is not allowed to interfere with programming decisions—which I know many members would say is a problem, because they would like their own best programmes put on. But Television New Zealand advises me that moving Te Karere is part of an overall strategy that could see the substantial increase in Māori content on Television One nearly double, and on channels overall, nearly triple. One of the things I would point out is that although it is being put on at a different time on traditional channels, Television New Zealand will be showing it at 6.15 on TVNZ 7.
Dr Jonathan Coleman Link to this
Does the Minister, who really does understand broadcasting, realise that since he took over the portfolio, he has managed to slash the value of Television New Zealand from $381 million in 2003 to $194 million in 2007—that is, he has halved the value—and what is his explanation?
Hon STEVE MAHAREY Link to this
One of the other people who will understand this will be Mr Maurice Williamson. At the end of the 1990s—[ Interruption] I tell Dr Nick Smith that Television New Zealand was being prepared for sale by the National Government. As a result, it drove down its cost structure by running programmes like , which cost about $50 an episode to run, while it raised some advertising revenue. In other words, it was prepared for sale by having very low cost structure but high resale value. Mr Jonathan Coleman, who is a rocket scientist on these issues, of course, will understand this, but we do not run the thing that way because we are not selling it.
Dr Jonathan Coleman Link to this
When the Minister said in the House in November 2005 that Television New Zealand is going through a transition towards becoming a company that will be commercially strong, did he understand that over a period of 4 years his broadcasting policy would end up delivering the loss of 160 jobs, and a revenue drop of over $100 million, and that he would have cut the value of the company by 50 percent; and is he confident he will be able to deliver the same sorts of results in his new job at Massey University?
Hon STEVE MAHAREY Link to this
The member knows that Television New Zealand has traded extremely well over the last 7 years or so. In fact, it has had very high levels of revenue, off the back of extraordinary levels of advertising, which I think we will claim full responsibility for, since the member wants to apportion blame. As the member knows, as I have already outlined, every public broadcaster now is going through a major transition from analogue to digital. That means major cost restructuring in organisations like this. As the board tells us, it has faith that the new plan will give the organisation a good, positive future.