Television Reform ir Nem Zealand - l The underlying dilemma is the small j size o f the market, which, Broadcasting Blues or Blue ? I with a population o f four million, j limits the profitability o f multiple The New Zealand industry has a charter which requires it to fulfil various | television operators, and means been the subject o f various reforms since cultural objectives. Questions remain about \ funding o f local content and public 1999 dealing with local content, diversity of how the new charter obligations will be funded \ service broadcasting is an ongoing and programming, digital broadcasting, the role over the long term and whether TVNZ will be i difficult issue. of the public broadcaster and funding. Marion successful in balancing a public service role \ Jacka examines these developments, remarking with a commercial imperative. The government broadcasting between two organisations - TVNZ on the distinctive features of the New Zealand has declined to introduce mandatory local and NZ On Air - which would pursue each market and the commitment to social and content quotas and has opted instead for a self- of these objectives independently (Spicer et cultural objectives. regulatory scheme similar to the approach being a I 1996, p. 15). The public funding previously taken to New Zealand music on commercial allocated to BCNZ and collected in the form of Overview radio. a fee was transferred to NZ Many have the While there has been some dissatisfaction with On Air. The role of this agency was to promote broadcasting blues. They want TV and radio the pace of reform from the film and television universal access, 'minority programming', and of a higher calibre (Christchurch Press, 2 production industry and various commentators, programs which reflect New Zealand identity February 2000, p. 8). the government argues that progress is and culture. In place of direct funding of the It is clear to us that the market model reasonable given budgetary constraints and publicly owned broadcaster, support for public is part, but not all of the broadcasting other factors. The underlying dilemma is the service programming was to occur through a equation; that it leaves many needs unmet small size of the New Zealand market, which, system of competitive contracts between public ... The government therefore resolved to with a population of four million, limits the and private broadcasters as part of the overall redress the imbalance by becoming actively profitability of multiple television operators, aim of creating 'a level playing field'.4 involved in broadcasting ... We recognised and means funding of local content and public The role of the publicly owned broadcaster that broadcasting, arts and heritage service broadcasting is an ongoing and difficult was thus changed in 1989 and is key to activities play a key role in defining in an issue. This and other distinctive features of the understanding the broadcasting environment increasingly globalised environment, what New Zealand broadcasting environment, such as and the policy options available to government. it means to be New Zealanders (Hon. Steve the structure of the industry, and nature of the TVNZ, which dominates the market, has over Maharey, Minister of Broadcasting 2003a). regulatory framework, mean that no template the last 13 years operated on a fully commercial from other countries such as Australia can be Broadcasting reform was a key element of the basis.5 As a State Owned Enterprise, funded readily applied and a distinctly New Zealand 's policy platform primarily by advertising, it was expected to approach needs to be developed. in the lead up to the 1999 election. The return a dividend to government, with social platform promised to increase the amount The paper falls into the following sections: objectives taking very much a secondary role. of New Zealand content on television and • an outline of the return the highly commercialised publicly landscape including an overview of digital Current structure owned broadcaster, Television New Zealand developments; The period following deregulation saw Limited (TVNZ), to a public service broadcasting • a discussion of the deficiencies the an increase in television services with the role. It represented a commitment to a more government is seeking to address; commencement of pay TV in 1990, and interventionist approach to broadcasting an expansion in free-to-air broadcasters. • progress with implementation of the reform policy in order to achieve social and cultural In the free-to-air space there are three agenda. objectives, in marked contrast to the policy national channels - TVNZ's TVOne and TV2, direction pursued since 1989 when broadcasting and CanWest'sTV3 - and two limited reach was substantially deregulated. The Labour The television landscape commercial channels TV4 (also owned by policy reflected widespread concern that the Since 1989 New Zealand television has been CanWest) and Prime, each of which reach deregulated environment had not delivered marked by an open competitive market, the around 70-75 per cent of the free-to-air adequately on quality and a New Zealand relative absence of regulation, and considerable audience. In addition there are 17 small regional identity in broadcasting content. dissatisfaction with the low levels of local and community broadcasters operating under Since 1999 the Labour government has set content and the overall quality of television commercial or non-commercial licences, and about the task of implementing its broadcasting services, particularly those provided by TVNZ. funded through a mix of local sponsorship, agenda. At the same time digital TV issues have The deficiencies in New Zealand television donations and limited advertising. come to the fore and, along with the distinctive broadcasting are usually traced back to the Despite the proliferation of services, a few features of the New Zealand broadcasting substantial changes that occurred in New broadcasters predominate: the main free-to- landscape, are adding to the complexity of Zealand in the late eighties at the height of 'the air broadcaster is TVNZ followed by CanWest; the task facing policy makers. New Zealand New Zealand experiment'- the program of wide Sky TV dominates the pay TV sector with provides a case study relevant to the broader ranging deregulation of the economy and of telecommunications company TelstraClear issue of how to support local content and a public institutions instituted ironically by a Labour (wholly owned by Telstra Corporation public broadcasting mandate in a changing government. Up to the late eighties, the publicly (Australia)), offering cable services in a limited broadcasting environment.1 The New Zealand owned Broadcasting Corporation of New Zealand geographical area, and, as set out below, now experience is also of interest in Australia given (BCNZ) was the only provider of television services. reliant on Sky TV for programming. the links tnat exist at many levels between The first major shift towards a deregulated TVNZ operates two national channels, TVOne the broadcasting and audiovisual sectors in environment occurred in 1987 when a licence for and TV2, with a combined audience share in both countries. This paper examines these a commercial service, TV3, was offered. This was 2001 of 66 per cent of the total television developments focusing mainly on the reform followed by the 1989 deregulation which involved audience (including pay TV), and around 70 of TVNZ and local content developments.2 The a major restructure of the public broadcaster per cent of the free-to-air audience. The two major outcomes to date are the establishment (renamed as Television New Zealand) and the channels are complementary with TVOne having of a long sought Maori television channel, removal of barriers to market entry.1 the larger audience share and targeting an older and chances in the role of TVNZ which is At the heart of the reforms was the separation demographic, and TV2 aiming at the under now operating under a new structure and of the commercial and social objectives of 39 audience. TVOne carries more recognisably

Communications Update June 2004 - Issue 166 - page 3 public service broadcast content, such as revenue, and losses in 2000-01 of $13.19 to the Ministry for Culture and Heritage (MCH), news and current affairs (which are entirely million. At the end of 2001 Prime announced with MED retaining responsibility for spectrum lacking on 7V2), some British drama, but also a five year agreement with Publishing and allocation and management and other areas a deal of delayed broadcast or non-premium Broadcasting Limited (PBL) under which of broadcasting policy. MCH also monitors and sport events such as Rugby Sevens, and reality the Nine Network in Australia will supply funds NZ On Air and the Broadcasting Standards programs, local and imported, for example The programming to Prime NZ and also handle Authority. The Crown Company Monitoring Great Outdoors and What Not to Wear.T\/2 advertising sales for the station (Marriner 2001). Advisory Unit and the Treasury advise the carries more popular drama and entertainment, In return PBL has been granted an option to 'shareholding' Ministers on the performance including the now well established local stripped acquire 50 per cent of Prime NZ over the next of the public broadcasters in 'maintaining their soap, , New Zealand , five years. The agreement will also see the delivery of goods and services' while the new movies and US comedy and drama such as The station's coverage expanded from 75 per cent of charter responsibilities for TVNZ are monitored Simpsons, Stargateznd The Drew Carey Show. the population to 90 per cent. This development by the MCH. Te Puni Kokiri (Ministry of Maori Affairs) monitors Te Mangai Pa ho and the new Until recently the TVNZ group also operated has led to a shift in Prime NZ's programming Maori Television Service (MCH 2003., p. 20). transmission and communications services profile from a largely British 'top end of TVOne businesses, primarily Broadcast Communications niche1 to a more mainstream channel' with Emerging digital issues Ltd (BCL), and TVNZ Australia.6 These businesses a significant increase in Australian and back Sky TV is virtually the sole provider of digital were responsible for a major proportion of the catalogue American programming (Drinnan TV with the main free-to-air channels carried TVNZ group's surplus in recent years, though 2002). It is now targeting the 18-39 age group on the Sky TV platform. TVOne and TV2 are this position changed in the 2003 fiscal year.7 as well as its primary target of 25-54 year-olds. unencrypted while TV3, TV4 and Prime are The change has seen a significant improvement Canadian company CanWest also operates encrypted and thus only accessible through in advertising revenue, reducing the loss before the Ten Network in Australia and broadcasting the Sky TV set top box.10 Sky TV’s digital service interest and tax to A$3 million for the second interests in Ireland and Canada, its two New offers up to 32 television channels, a number half of 2002 (Schulze 2004). Zealand channels have a combined audience of audio services, four pay-per-view channels, share of around 30 per cent of the free-to-air and some recently introduced interactive applications. audience. TV3 with 25 per cent, targets the The debate a b o u t the need fo r 18-49 age group and is the main competitor government intervention subsided Carriage of TVOne and TV2 on the Sky TV to TVNZ'sTV2. Its programming mix is a somewhat in 2002 as problems platform occurred after two attempts by TVNZ combination of TVOne and TV2 strategies: it with take-up o f digital TV in other to launch a separate digital service. The first has a news service competing with TVOne’s, countries became evident and the involved a proposal announced in late 1999 followed by , infotainment such government preferred to take a 'w a it for a digital data network to provide a free-to- as Kylie Kwong and Oliver's Twist, imported and see' attitude. However it was air/pay TV service in partnership with UK pay programs such as CSI, Crime Scene Investigation clear that digital issues would need TV operator NTL. The newly elected government and Rove Live. TV3 also has a heavy reliance on to be addressed. rejected this on the grounds of expense and movies in the 8.30 pm slot. because it would distract attention from the Until recently the television business was reform of TVNZ. The second attempt involved The take up of pay TV at 39 per cent of operating at a loss, while CanWest's extensive TVNZ in partnership with TelstraSaturn (now households, is relatively high, driven, in the radio holdings in New Zealand recorded profits. TelstraClear) planning a free-to-air/pay TV absence of anti-siphoning rules, mainly by In early 2002 CanWest indicated its intention digital platform. TelstraSaturn subsequently premium sports programming, which has been to divest itself of its New Zealand broadcasting withdrew from the agreement in August 2001 siphoned from free-to-air, primarily TVOne._ assets to help pay off the debts resulting from and reached a program sharing agreement v/ith Sky TV, majority owned by News Limited (News activities in other markets. However results for Sky TV. This left TVNZ without a pay TV partner, Corp) controlled Independent Newspapers the television business subsequently improved as Sky TV would not allow its content to be Limited (INL), dominates the pay TV sector. with 7V3 reporting a full year operating profit accessed via the TVNZ platform. In this situation Sky TV operates both an analogue terrestrial of $3.2 million for the year ending August 2002, TVNZ was unable to proceed, having nothing to network covering approximately 74 per cent of compared with an $8.5 million loss the previous offer immediately except channels TVOne New Zealand households, and a digital satellite- year (Hendery 2003).8 Revenue growth for TV3 TV2, and the promise only of more channelsand based network covering the entire country. continued, leading to a 23 per cent increase new applications in the future. Sky TV reached an agreement at the end of in earnings before interest, taxes, depreciation There was considerable debate about New 2001 with cable operator TelstraClear, under and amortization (EBITDA) for the year ending Zealand's digital future over 2001 as the industry which it will provide all TelstraClear's television August 2003 (TV3 2003). In early 2003 CanWest events outlined above unfolded, and as digital TV programming, and manage the relationship indicated it was pulling back from selling transition proceeded in other countries.11 with suppliers and subscribers.9 As of August its New Zealand assets and subsequently 2003 Sky TV had a total of 540,794 residential The main issues in the digital debate were: announced a new direction for TV4. This subscribers with 421,473 of these receiving the • What are the implications of the potential involves using the frequency for a youth digital service. While Sky TV experienced the Sky TV monopoly? oriented music channel from 4.00 pm to 12.00 losses common to pay TV providers in other midnight (1.00 am on Fridays and Saturdays). C4 • Should the government regulate for open parts of the world in the start up phase, its - free-to-air music television - was launched access to ensure competition, viewer access financial position is now improving. Subscriber in October 2003 with management hailing its to content, and content provider access to revenue increased by 15.9 per cent in the year success at attracting the 'hip young urban1 platforms? ending August 2003 and Sky TV announced audience and predicting that it would break • How can an alternative free-to-air digital a net profit of $671,000 - the first since the even within 12 to 24 months (TV3 2003). Non­ platform be established? Will them be launch of the digital network in 1998 (Sky music programming on C4 includes South cooperation between the free-to-air Television 2003). Park, American stunt comedy Jackass and New broadcasters? And will the government Zealand's own Pulp Sport. Regulatory arrangements need to subsidise the cost of extending Prime NZ, a subsidiary of Australian regional Prior to 1999 the Ministry of Economic digital transmission to more isolated ru'al broadcaster Prime Television Limited, has been Development (MED) was responsible for most areas7 aspects of broadcasting administration and operating in New Zealand since the end of • What are the implications of digital TV policy. In 1999 the newly elected Labour 1997, broadcasting in nine cities and provincial for the government's social objectives in government shifted responsibility for advice on centres. Prime's New Zealand operation was broadcasting and in particular for TVNZ's non-commercial aspects of broadcasting policy struggling with a 1 per cent share of television new public broadcasting role, for Maori

page 4 - Issue 166 - Communications Update June 2004 television, regional and non-commercial The need for reform Farnsworth has described the outcomes of the television, and the promotion of local model for support of local content as follows: The problem has been one of under­ content? performance by the New Zealand model of ... it has created pressure for cheap, mass On the question of a Sky TV monopoly, broadcasting as a whole. I do not believe produced local programming. Moreover commentators argued it was undesirable for the that the true reality and diversity of New none of these figures (for the main national dominant pay TV provider to control the digital channels) account for the tiny amount of Zealand life are well enough represented gateway to the home. Provision of the free- in our broadcasting. I think that the local content shown on any of the TV4, to-air services through Sky TV was seen as a contribution broadcasting can make to Prime or Sky TV channels. The net result is second best option which would impact on their democratic participation and public debate often thinly spread, cheaply produced local ability to fully develop the potential of digital is under-developed (Hon. , content overall (2002a, p. 334). TV. There was also some uneasiness about New Minister of Broadcasting 2001a). For some years local content across the three Zealand being reliant on a foreign owned pay While the 1989 changes led to an increase in national free-to-air services (TVOne, TV2 and TV company using a foreign owned satellite (the 7V3) represented between 23 and 24 per cent OptusB2 satellite), for digital services. television services, the quality of those services has been very contentious. The major concerns of total broadcast hours (24 hours a day). In On the open access issue Sky TV argued there have been: 2002 in a development hailed as 'a significant was no need for regulation as it has provided milestone', this rose to 27.4 per cent (NZ On • the low levels of New Zealand content; access for the free-to-air services. However the Air 2003a, p. 1). Local content in prime time advocates of regulation respond that this has • the lack of diversity in that content; (6.00 pm to 10.00 pm) was 39.5 per cent, up been a one-way street, with Sky TV not prepared • the minimal presence of quality in-depth from 37.2 per cent in 2001. This is still below the to make its content available through the news and current affairs programming; peak of 42 per cent reached in 1995. mooted TVNZ/TelstraSaturn service, or through a • the excessive amounts of advertising on Since 2001 NZ On Air has also been reporting stand alone TVNZ platform. TVNZ services. local content outcomes for the period 6.00 am The debate about the need for government to midnight to allow a comparison to be made To a considerable extent these concerns have intervention subsided somewhat in 2002 as with Australia's 55 per cent transmission quota. centred on TVNZ, given its public ownership problems with take-up of digital TV in other On this basis the outcomes by network for 2002 and dominant market position. TVNZ's reliance countries became evident and the government were as follows. on advertising revenue - 75 per cent of TVNZ's preferred to take a 'wait and see' attitude. revenue as of June 2002 - and the absence Channel 2002 2001 However it was clear that digital issues would of a public service mandate have meant New TVOne 60% 54.5% need to be addressed. In August 2002 the Zealand audiences have been provided with briefing paper for the incoming Minister of TV 2 25% 17.40/0 very limited diversity and choice. There are Broadcasting observed that decisions on the TV3 22% 19.60/q differences in programming between the three government's role in the development of national channels, related to factors such as NZ On Air noted that while there were increases platforms and the public's access to free-to-air their different target audiences, the extent in almost all programming genres, the major content across platforms are crucial for the to which they draw on American or British contributor by far to the increase was sport, future of Television New Zealand as the vehicle drama, and some differences in the type of local followed by an increase in repeat programming for public policy objectives relating to content' content they provide. However all three operate (NZ On Air 2003a, p. 1). (MCH 2002, p. 12). as mass appeal, commercially driven services. The higher outcome for TVOne shows a Work continued on digital policy. Cabinet The lack of program diversity is related to the responsiveness to audience interest in resolved at the end of 2002 that 'broadcasters absence of the structural diversity that marks local material. It is related to the channel’s and viewers should be free to choose the the Australian industry with its mix of publicly traditionally dominant market share which platform by which digital TV is provided' and funded and commercial broadcasters. provides the revenue needed to support higher that it would not set an analogue switch-off Local content levels of local content. The other channels fall date, given the likely length of the transition to well below Australian levels and as discussed digital TV. in 2003 a number of decisions were Support for local content has been delivered below, all three national networks have been taken to assist public broadcasters to plan for through a single mechanism - direct subsidy marked by limited diversity in local content. digital transition, support industry development available through NZ On Air - with grants The amount of local content on the other of viable economic models and ensure suitable available to the national broadcasters on a television services is minimal. spectrum and networks are available. These competitive basis. Relatively speaking the decisions included: level of public funding has been low. A 1999 • TV4 screened 117 hours in 2002, (down 69 hours on 2001) representing 4.6 per cent of • TVNZ and the Maori Television Service are comparison of public funding of broadcasting total broadcast time. to prepare plans for digital services; across seven countries showed that New Zealand had the lowest level of per capita • Local content on Prime dropped • where content is publicly available it should expenditure. The per capita figure was $12, significantly from 697 hours in 2001 continue to be available free-to-air; compared to $43 for Australia, $57 for Ireland to 39 hours in 2002 due to the content • the MED is to monitor terms of access to and $40 for Canada (MCH 2001a). There have arrangement with the Australian Nine satellite broadcasting capacity; Network, which led to the demise of local • the broadcasting industry was invited to news and the infomercial, Prime Living. : The tack o f program diversity establish a digital TV group to plan for and • There is minimal New Zealand content on is related to the absence o f the promote digital TV; Sky TV with most channels having no local structural diversity that marks the • agreement in principle to the reservation of programming. The five channels which Australian industry with its mix of spectrum for simulcasting existing analogue do have some local material showed the ; publicly funded and commercial services in digital format and/or for public following results in 2002: Sky Sports - 1170 broadcasters. broadcasting; hours; Sky 1 - 99 hours; The Living Channel • holders of existing analogue licences will be - 120 hours; National Geographic - 51 able to swap those licences for digital ones been increases in public funding since 1999, hours; and Rialto Movie Channel - 122 at no e

page 8 - Issue 166 - Communications Update June 2004 levels of New Zealand programming on the children's programming 2004 targets are still supplementing government funds. The main major free-to-air networks. It convened again below actual levels for 2002, suggesting that options explored were a levy on advertising later in 2003 to set targets for 2004. The scheme the scheme is mainly operating as a safety net revenue, taxes on imported programming, sets overall transmission targets and genre rather than an incentive for increased local and increases in returns on program sales. specific targets. The latter apply to four broad programming. Boosting the amount of new These were all dismissed on the basis that categories: local dramas is particularly a challenge as the they would not generate sufficient additional • children's programs; long running series ShortlandStreet on TV2 revenue to justify the inefficiencies and other accounts for most of TVNZ's first run New disadvantages involved. For example it was • drama, comedy and children's drama; Zealand drama. Target hours for first run drama concluded that the cost of a levy on advertising • documentary, information, entertainment for TVOne and TV3 for 2003 were 33 and 35 revenue would impact on the financial viability and Maori programs; hours respectively. of the still unprofitable private broadcasters • sport, news and current affairs. The definition of New Zealand content under or alternatively be passed on to customers The overall transmission targets for 2003 and the scheme is 'material which is predominantly (advertisers and consumers or subscribers). 2004 are set out below along with the actual made in New Zealand and reflects New Zealand Further, and most significantly, the bulk of such levels achieved by each broadcaster in 2002. identity and culture'. Foreign programs made in a tax would be paid by TVNZ and consequently New Zealand are thus not counted and most would lead, in the words of one official, to a Overall Targets - NZ Content Under Local Australian programs would be excluded. Given 'pointless money go-round' that would provide Content Agreement 6.00 am to 12.00 midnight the scheme is set up under a voluntary industry no net gain to the Crown.25 Actual 2002 2003 Target 2004 target agreement rather than through government The paper concluded that given the limited regulation, it seems it would not offend New amounts which could be generated from TVOne 60% 53% 52% Zealand's GATS and CER commitments. privately-owned broadcasters, 'the government TV2 25% 17% 19% has other instruments available (conditional TV3 22% 20% 20% Funding public service subsidies and/or quota) which could provide Sources: NZ On Air (2003a, 2003b), Television broadcasting an incentive to the broadcaster... without Local Content Group (2003). TVNZ implemented some programming changes incurring the costs of compliance, collection in 2002, urged on by the government, which felt and administration (MCH 2001b, p. 8). that some progress towards charter objectives More generally the analysis of alternative could be made within 'its already substantial mechanisms concluded that, in the New The following table shows the aggregate genre programming budget' (Hobbs 2001a). This was Zealand environment, general taxation sourced targets for both years along with actual levels reflected in increases in drama and children's funding was the most efficient and effective for 2002. programming and some changes in the news means of funding local content available to the government. Consequently the government has opted for Aggregate Hours NZ Content by Genre Under Local Content Agreement direct funding to TVNZ and additional funding Actual 2002 2003 Target 2004 Target* for NZ On Air. The latter received an additional All First Run All First Run All $6 million in the 2002 budget and $8 million over three years in the 2003 budget. In the 2002 Children's 583 (314) 626 (422) 633 budget TVNZ received an additional $12 million (247) 357 (210) 355.5 Drama, Comedy, C Drama 447 for the first year of the charter, with further Documentary, Information, commitments in the 2003 budget to take charter Entertainment, Maori23 2761 (2017) 1530 (2102) 2084 funding to $17 million a year from 2006-07 News, Current Affairs, Sport 3410 (3171) 2767 (2828) 2914 (Maharey 2003c). It is not clear what the position will be with any surplus TVNZ generates * First release hours for 2004 not available. under the new arrangements. The TVNZ chief Sources: NZ On Air (2003a, 2003b), Television Local Content Group (2003). executive was reported in early 2003 as saying he expected the government would no The genre targets for 2003 were in the main and current affairs area, where specialist longer require the broadcaster to pay a dividend set below the actual broadcast levels of 2002. reporters were recruited 'to bring greater depth and that any surplus could be channelled The Local Content Group advised that given to this area of programming'.24 into programming (Cleave 2003). If this is the the agreement was reached well into 2003, The government accepted however, that some case and the company continues to make a genre levels were set taking existing production additional funding was required to make surplus, the additional funds available for local and scheduling commitments into account substantial progress towards charter objectives. programming will in effect be higher than $17 (Television Local Content Group 2003, p. 3). In terms of how additional funding might be million.26 The exception was in the area of children's delivered, a number of options were floated in The outcome is consistent with the preference programming where the overall target and industry circles:' forgiving the dividend'; direct for funding charter requirements via direct individual targets for both TV2 and TV3 are budgetary allocation; more money to NZ On Air, allocation for reasons of transparency. higher than the 2002 level. and/or TVNZ getting a greater and guaranteed The direct provision of funds to TVNZ also First run hours for 2004 were only available in share of NZ On Air funding. reflects the government's aim of achieving aggregate. It can be seen that in the areas of Some consideration was given at an earlier on-screen improvements in the publicly children's programming and drama and comedy, stage to alternative funding mechanisms owned broadcaster's news and current affairs total hours of local content are very close to with the MCH examining the applicability coverage, areas not funded by NZ On Air. At 2003 targets and given this it is likely that first of international models for funding public the same time the outcome sees the NZ On run hours have not increased significantly on broadcasting outcomes. A paper prepared Air model maintained with the then Minister the 2003 targets. Overall except in the area of in January 2001 looked at possible ways of of Broadcasting affirming the government's commitment to NZ On Air as a contestable ! The definition o f New Zealand content under the scheme is 'material which is funding agency for TV programs. \ predominantly made in New Zealand and reflects New Zealand identity and culture'. It remains to be seen how successful TVNZ will Foreign programs made in New Zealand are thus not counted and most Australian be in balancing its commercial and cultural roles programs would be excluded. and whether the voluntary agreement backed by additional funding will over time significantly

Communications Update June 2004 - Issue 166 - page 9 enhance the quantity and quality of New an independent agency), to a system involving References Zealand programming. There has been some an arms length funding agency plus direct Cleave, L (2003), 'State TVs brave new world', discussion about using funding in tandem with funding (at modest levels) of the public service Weekend Herald, 4-5 January, p. A5 the voluntary quota approach to encourage broadcaster. In the New Zealand environment broadcasters to increase license fees, take risks it clearly makes sense to focus on the public Drinnan, J (2002), 'Channel primes itself for with time slots, and encourage innovation. As broadcaster with its major market share. The expansion', OnFilm, March, p. 1. outlined by NZ On Air chief executive Jo Tyndall challenge over the next years will be to maintain Farnsworth, J (2002a), 'Local and Global in November 2001 this ’quota driven by funding the momentum and develop digital policy. Contexts of New Zealand Television', in J arrangements' would involve setting the terms Public expenditure will continue to be the main Farnsworth Ft I Hutchinson (eds), New Zealand and conditions for broadcasters to access NZ On mechanism for supporting diversity and quality Television:A Reader, Dunmore Press, Palmerston Air funding.27 in New Zealand programming in the foreseeable North, pp. 332-42. future. The key question remains what is the ------(2002b), ’Mainstream or Minority: Conclusion additional amount New Zealand governments Ambiguities in State or Market Arrangements ... the government is seeking to build are prepared to pay for broadcasting outcomes? for New Zealand Television, in J Farnsworth Ft a viable, contemporary framework for The answer will determine the extent to which I Hutchinson (eds), New Zealand Television: A broadcasting in a volatile environment of New Zealand audiences can shake off their Reader, Dunmore Press, , competing interests, changing needs and broadcast ng blues. pp. 189-198. inevitable constraints. These three things we Marion Jacka Goldsmith, B, Thomas, J, O'Regan, T Ft must take as givens: is a researcher/policy analyst in the media/ Cunningham, S (2001), The Future for Local • funding is not unlimited; audiovisual sectors. She has undertaken work Content? Options for Emerging Technologies, • any framework of government for the Australian Film Commission, the Creative Australian Broadcasting Authority and involvement must be flexible enough Industries Faculty at Queensland University of Australian Key Centre for Cultural and Media to respond to new technologies. Technology, and the Australian Broadcasting Policy, Sydney, June. It must be capable of working in a Authority. Marion undertook this study of Hendery, S (2003), 'Ratings, sales revive CanWest digital environment - which raises television broadcasting in New Zealand with faith in TV3', New Zealand Herald, 23 January, different demands than the analogue support from the Institute of Social Research at p. C3. environment; Swinburne University of Technology, Melbourne. Hobbs, Hon. M (2001a), 'A New TVNZ', Media • NZ citizens deserve diversity and New Zealand born and a frequent visitor, Release, June, . provided, we need viable broadcasters, television1 ------(2001 b), Speech to SPADA Conference, 12 (Hon. Marian Hobbs, Minister of Thanks to Helen Wilson for editing this version November 2001, SPADA News, December, pp. 5-7. Broadcasting 2001c). of the paper. ------(2002), 'Television Funding', Address to Will audiences see a better reflection of the Media Studies Class, Victoria University, 8 May, diversity of New Zealand life and culture on . Is the outcome likely to be a continuation of Lealand, G (2000), ’Regulation - what what Farnsworth (2002b, p. 194) has called regulation? Cultural diversity and local content television by compromise? The production in New Zealand television,’ Media International industry was initially bitterly disappointed about Australia incorporating Culture Ft Policy, no. 95, the reluctance to introduce mandatory local May, pp. 77-89. content quotas though it is now participating Maharey, Hon. S (2003a), ’Acknowledging the in the voluntary scheme. Others such as the contribution of commercial radio broadcasters', New Zealand Friends of Public Broadcasting Address to Radio Broadcasters Association, 10 insist that the mixed model for TVNZ is a second May, . television service should have been established. ------(2003b), Television New Zealand Bill, Third The government argues that it has had to work Reading Speech, 27 February, within significant constraints as reflected in . argues with some justification that there have ------(2003c), ’Broadcasting Bonus', been a number of positive outcomes in the Maharey Notes, vol. 4, no. 88, 16 May, broadcasting sector - the cultural package in . the increases in NZ On Air funding, the Marriner, C (2001), ’Packer rescues struggling establishment of the Maori channel, the charter Prime NZ’, Sydney M orning Herald, 22 December. for TVNZ, the code for local music on radio, and Matthews, P (2002), 'Now for the hard part,’ the commitment to youth radio and to Pacific Listener, 8 June, pp. 26-27. Island radio (Hobbs 2001b Ft 2002).28 To this list can now be added the voluntary agreement on Ministry for Culture and Heritage (MCH) (2001a), local content on television, though it remains Letter to Minister of Broadcasting, 8 May, copy to be seen whether this will act as a safety provided to author. net or lead to increases in local programming. ------(2001b), ’Funding Public Broadcasting The charter for TVNZ and the reassertion of its Objectives: Further Analysis of Some Options public broadcasting role is significant following for Sourcing Funds', paper prepared for Minister the purely commercial focus of the last 13 years, of Broadcasting, 16 January, copy provided to and given that prior to the 1999 change of author. government, privatisation was on the agenda. ------(2002), 'Briefing to the Incoming Minister of Broadcasting: Hon Steve Maharey’, August, A shift in broadcasting policy is occurring in the . on a single mechanism (public funding through

page 10 - Issue 166 - Communications Update June 2004 ------(2003), 'Broadcasting in New Endnotes 12 Maori programming is defined as Zealand: A 2003 Stock-take', 21 November, programming made predominantly for Maori, 1 In the Australian context there has been . speculation that existing approaches to local content regulation may need to be reviewed 13 Accounted for mainly by the popular long- Ministry of Economic Development (MED) as digital developments proceed. A major running Shortland Street. (2001), D igital Television: Discussion Document, contribution to the debate is Goldsmith et al 14 TVNZ's children's programming is on TV2 , December. (2001 ), The Future for Local Content? Options which is targeted at the under 39 audience with Norris, P Et Pauling, B (2001), New Technologies for Emerging Technologies, which explores TVOne aimed at older viewers. and The D igital Future: A report for NZ On Air, NZ strategies for the achievement of social 15 Under the Australian Broadcasting Authority's On Air, August. and cultural objectives for broadcasting in Australian Content Standard, free-to-air NZ On Air, (2001a) New Zealand Television: Local converged television environments. commercial broadcasters are required to screen Content 2000, NZ On Air. 2 The paper draws on a study undertaken with a minimum of 20 hours a year of first release ------(2001b), Annual Report 2000/01. support from the Institute of Social Research, Australian documentary programs. In 2001 the ------(2001c), 'New Zealanders Want More of Swinburne University of Technology, Melbourne. Nine and Ten Networks broadcast just on 20 New Zealand On Air,' Media Release, August. The study draws on published sources and hours and the Seven Network, 24 hours. ------(2003a), New Zealand Television: Local discussions with government and industry 16 The remaining NZ On Air funding goes to Content 2002, NZ On Air. representatives in New Zealand in late 2001 and radio (for 's two public ------(2003b), 'TV Local Content Targets for in 2002. service stations, and for access / special interest 2004', Media Release, December. 3 For a discussion of the regulatory radio), New Zealand music, archives and OnEilm (2003), ’Govt spending closes gap in arrangements put in place by the 1989 transmission coverage. broadcasting regulation see Lealand 2000 and world rankings', table accompanying article by 17 This led to one program, Being Eve, Thompson 2002. Wakefield, P, ’New strategy for NZOA', OnFilm, commissioned for TV3 in the first year of the May, p. 9. 4 In 1993 a separate funding agency, Te Mangai initiative. In 2000-01, two programs comprising Schulze, J (2004), 'Ad revenue lift prime Paho, was established for the promotion of 26 half hours of children's drama were earnings', The Australian, 25 February, p. 34. Maori language and culture in radio and supported - Flard Out, a spoof action thriller for television. Te Mangai Paho funds programs TV2 and a second series of Being Eve. Sky Television (2003), 'SKY Television Announces made specifically for a Maori audience with 18 In relation to Maori programming, NZ On Air Improved End Of Year Results', Media Release, total expenditure on television programs in has a complementary role to that of Te Mangai 20 August. 2000-01 of $17.35 million. Paho, funding programs featuring Maori themes SPADA (2000), Television Programme Quotas: A b It needs to be noted that from the inception and perspectives, substantially produced Blueprint for New Zealand, April. of television, publicly owned television was by Maori and intended for the mainstream Spicer, B, Powell, M Et Emanuel, D (1996) The funded by advertising as well as public funding. audience including Maori' (NZ On Air 2001b, Remaking o f Television New Zealand 1984-1992, However the reliance on advertising increased p. 17). University Press, Auckland. significantly from 1989. 19 NZ On Air funding has to date been allocated Television Local Content Group (2003), Report 6 These provide domestic and international primarily to national networks given its mandate o f the Television Local Content Group, June, linking and transmission facilities and services of reaching the widest possible audience.

Communications Update June 2004 - Issue 166 - page 11 The group advised that it expected to make specific commitments on Maori programming once the position with the MTS is clearer. Australia and New Zealand 24 60 M inutes was dropped with a new current affairs show, Sunday, replacing it in the 7.30 pm Sunday evening time slot. 7VNZ described the There's a bit more than closer economic relations to the new program as 'designed to reflect New Zealanders in the 21st century’, and promised that viewers will find a greater diversity of content and cross-Tasman relationship and possibly more post-Blue Sky telling techniques' (TVNZ 2002). However the program does not intrigue according to Jock Given. reach the standard of TVNZ's other flagship but less regular current affairs program, Assignment, and has met a luke-warm critical reception. This year's Academy Awards were mostly a Lord o f the Rings Sh ow. When 25 Email from Martin Durrant, MCH, 21 February 2002. the third instalment of Peter Jackson's series won in every category it 26 TVNZ as a whole returned a dividend of $5.1 million for the 2002 fiscal was nominated, host Billy Crystal joked that people were moving to New year, and $7.8 million in 2003. It remains to be seen what the position is Zealand just to be thanked. once the separation of the television and transmission arms has occurred. A few Australians had work to do at the Kodak Theatre as well. Russell 27 As outlined by Tyndall this could be done via a performance agreement Boyd won the award for cinematography {Master and Commander: The Far which would set broad outcomes with targets for particular genres. Side o f the World] and Adam Elliot won for best animated short (Harvie A certain sum would be set aside for each broadcaster, i.e. TVNZ and Krumpet). Jackson and The Return of the King beat Australian Peter Weir CanWest, but programs would still have to be approved and funded on a and Master and Commander for best director and best film, and New program by program basis (Tyndall 2001). Zealander Keisha Castle-Hughes and Australian Naomi Watts w/ere both nominated for Best Actress. 28 One of the 1999 election commitments was to a publicly-funded ad free youth radio network. While supported by high profile musicians this Just three years earlier, Oscar-winning screen gladiator Russell Crowe met considerable resistance from commercial radio interests. An advisory had told the Academy ’When you grow up in the suburbs of Sydney group report was delivered to government in June 2002. As of May 2003 or Auckland or Newcastle ... well, the suburbs of anywhere, a dream no decision had been made with the government still considering 'the like this seems kind of vaguely ludicrous and completely unattainable'. most appropriate form of radio content and services for young New Far from being ludicrous and unattainable, the day after the Rings- Zealanders' (Maharey 2003a). The Pacific Radio Network involves the Fest, Wellington's Dominion Post warned its readers of the 'dangerous government allocating spectrum and funding to extend Pacific Island presumption' of believing the Academy Awards would become 'an annual radio currently operating in Auckland to major centres with significant fixture on our cultural calendar’. Pacific peoples populations. To some extent, the accumulation of Oscars in the Antipodes from the mid-1990s reflected the fragmenting global geography of the movie business. Hollywood remained the industrial and financial centre, but an increasing amount of the production was happening at a distance. With some of the biggest and most technically complex movies of the era - the Star Wars prequels, the M atrix movies, the Rings - being made in Sydney and Wellington, it was hardly surprising that some of the critical attention headed there as well. The trend also highlighted the growing integration of the media industries in Australia and New Zealand. The Piano, produced by an Australian production company but shot in New Zealand, was an earlier, Oscar- winning example^Jane Campion, original screenplay; Holly Hunter, actress; Anna Pacquin, supporting actress). The Rings trilogy was made in New Zealand by a New Zealand production company, employing many Australians including actors Cate Blanchett, Hugo Weaving, Miranda Otto and David Wenham and cinematographer Andrew Lesnie. Every sector of the media industry now has large enterprises operating in both countries, as the table 'Closer Media Relations' shows. The ease of migration between the countries also means the integration is embodied in individual people, notably New Zealand-born Australian residents Campion and Crowe, Australian-born but New Zealand-resident Castle- Hughes, and overseas-born, New Zealand-raised, Australian-resident Sam Neill. In policy circles and among the official representatives of the film and television production industries, however, the creative and industrial integration has been received with less equanimity. The Australian Broadcasting Authority (ABA) had to amend its Australian Contem Standard in 1999, following a successful challenge in the Australian High Court by a New Zealand production industry group. From 1 March 1999, New Zealand programs have been able to count towards Australia's program quotas. So far, it hasn't made much d fference to the programs screened on Australian TV. No New Zealand programs were broadcast by the Australian networks in 1999 and less than nine hours of New Zealand programs were broadcast in 2000. When re/iewing the standard in 2001 and 2002, the ABA found that the inclusion of New Zealand in the standard 'did not appear to have had any appreciable impact on the broadcast of Australian programs on commercial television1. This doesn't mean the fight was without impact. The broader idea of audiovisual industry integration has clearly happened anyway, anc a single decision to, for example, co-produce a major new 'Australian' TV drama

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