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The Realities of a SVOD World

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I’ve been watching the debates raging across the Tasman as the Austalian screen industry seeks to ensure the future of Australian content in the face of the realities of SVOD.

Research company Roy Morgan reported in March 2019 that nearly 14 million Australians now have access to some form of Pay TV/Subscription TV, up 11.8% on a year ago.

Netflix with over 11.2 million subscribers had growth on a year ago of 25.2%, with Australian-owned Stan at 2.6 million subscribers seeing a 45.2% increase.

YouTube Premium and Amazon Prime also had significant increases.

Australian broadcasting standards require all commercial free-to-air television licensees to broadcast an annual minimum transmission quota of 55 per cent Australian programming between 6 am and midnight. In addition, there are specific minimum annual sub-quotas for first-run Australian adult drama, documentary and children’s programs.

SVODs in Australia have no Australian content requirement.

Australian commercial broadcasters sought in 2017 to have the quota removed for Australian children’s content. The Australian screen industry united against this, decrying what they said would be the almost complete annihilation of Australian children’s programming.

Then in 2017 the Australian Directors’ Guild; Australian Writers’ Guild;  Media, Entertainment & Arts Alliance and Screen Producers Australia joined together to launch the ‘Make It Australia’ campaign to lobby the Government for support for the sector in the wake of sustained funding cuts and changed viewing habits, which of course includes the rise of SVODs.

They called for no more cuts to SBS, the ABC and Screen Australia; a raising of tax incentives for Australian TV and foreign productions; a cementing of the commercial free-to-air Australian content quota at 55%; and new regulations for Subscription Video on Demand (SVOD) providers.

The Australian Government launched in 2017 an Australian and Children’s Content Review.

In March of 2019, the Senate Committee released its Review paper. Among the recommendations was a call to force streaming services such as Netflix and Stan (and Amazon and any others who might enter the space) to spend a minimum 10 per cent of income earned in Australia on original Australian content. They would also be obliged to promote that content to their subscribers. The other recommendations:

  • The current quota system being preserved.
  • Examining other Terms of Trade provisions and implementing them.
  • Introducing a single Producer Offset of 40%.*
  • Ceasing recognising New Zealand content as Australian.**
  • Increasing the Location Offset to 30%
  • Decoupling the Location and Post, Digital and Visual Effects (PDV) Offset.
  • Platform Neutral Location and ODV Offsets.

*The Producer Offset, Australia’s version of the NZ Screen Production Grant, sits at 20% for TV.

**This refers to Project Blue Sky, which allowed NZ content to be recognised as Australian content because of the Closer Economic Relations (CER) agreement between the two countries.

What did they Australian Government do in response? It allowed streamers that operate behind a paywall access to the production incentive for content they make in Australia, which of course includes international productions shooting there.

“The Government’s policy announcement is inexplicable and one-dimensional given how many times our local sector has called for urgent intervention”, said Austrlian Directors Guild CEO, Kingston Anderson.

“Our screen incentives need to be updated across the board, not just those that apply to international production. This decision shows a tremendous lack of confidence in the ability of Australians to tell our stories in our own voices.”

You are possibly wondering why at this point I am so wrapped up in what’s going on in Australia? It’s because I feel it’s clearly indicative of what we face and have essentially been ignoring till now. The 10-year screen strategy recently called for by the NZ Government is a chance to address the many problems the onslaught of foreign content and SVODs are having on the NZ screen industry. We only have to look across the Tassie for some insights and thoughts on how to address the issues.

 

Tui Ruwhiu
Exeuctive Director

Screen Turmoil Across Tassie Causes Concern

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The Australian Broadcasting Corporation was thrown into turmoil last week when Managing Director Michelle Guthrie was fired. Chairman at the time, Justin Milne, a political appointee and personal friend of Prime Minister Malcolm Turnbull, questioned her leadership style and her relationships with Canberra.

Milne was then ‘forced’ to resign when it became clear that he had allegedly asked Guthrie to get rid of two ABC reporters who had written negatively about the Conservative Government.

While Guthrie won few friends inside the ABC for being a distant and absent MD, it seems she was doing a good job protecting her employees from the political pressure exerted on her.

The ABC has long been under pressure, with global media disruption, funding cuts, complaints of bias from government and attacks from the commercial media sector. With five years of government with the Conservatives at the helm, it is perhaps the accusation of left-wing leanings that has most brought the ABC to its current position.

In his opinion piece in the Sydney Morning Herald, Vincent O’Donnell, honorary associate at the School of Media and Communication at RMIT University, found some fault with the ABC, but stressed that its role as a public broadcaster with bias is not a vice but a virtue.The ABC, especially ABC radio, devotes airtime to issues that are largely ignored by other media: religion, feminism, Indigenous issues, Muslim and other minorities’ interests. In doing so it paints a picture of an Australia that is at odds with some people’s beliefs about Australia, for whom Australia is white, European, Christian and male.”

There’s an abject lesson for us in NZ from all this.

As reported in an NZ Herald story back in 2003, former magazine and Radio Liberty journalist and ACT MP Deborah Coddington accused our leading public broadcaster Radio NZ of bias in her Saving Public Radio report.

In his 2015 piece, RNZ Mediawatch presenter Colin Peacock took a look at bias in the NZ media without coming up with a conclusion, although he does cite the survey of NZ journalists that found 62 percent of them lean to the left.

With the change of government to Labour in 2017 came a focus on strengthening public broadcasting. This brought forth criticism from the commercial media sector when Fairifax CEO Sinead Butcher questioned Labour’s “… approach of piling more money into state-owned media, and their plans to turn Radio NZ into a super-media platform and broadcaster.”

In an unusual about face from the commercial sector, Mediaworks boss Michael Anderson supported public broadcasting with a call for TVNZ1 to become a public broadcaster. He was transparent with his reasoning here, being to allow Mediaworks access to the advertising revenue TVNZ takes from the declining piece of the free-to-air advertising pie.

These currently timid pokes by the NZ commercial media sector at public broadcasting pale in comparison to the Murdoch empire’s all out war against the ABC in Australia and the BBC in the UK, outlined in an opinion piece by Martin Flannagan in the Sydney Morning Herald in 2014. This railing against the ABC by Murdoch’s Newscorp continues unabated, with calls for its and SBS’s charters to be reviewed because of unfair competition.

The NZ Labour-led coalition government has a focus on enshrining public broadcasting. Former Broadcasting Minister Clare Curran said earlier this year in an address to the Public Media Trust that “I am a firm believer in the value of independent public media – both as a means of holding our institutions to account, and for its contribution to our national identity.”

Curran obviously didn’t read her own memo about political interference when it became obvious that Radio NZ’s CEO Paul Thompson and Chair Richard Griffen disagreed with her plans to turn RNZ into a TV broadcaster. She stumbled over her ‘clandestine’ meeting with RNZ’s Carol Hirschfeld, and then fell on her own sword after her discovered get-together with Derek Handley over the Chief Technology Officer job.

If the ructions across the Tassie are anything to go by, we can expect that political and commercial pressure on public broadcasting in New Zealand won’t let up, no matter who’s in power. There’s a lot at stake and we can thank the Aussies for giving us a heads up on what’s coming.

Tui Ruwhiu
Executive DIrector