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Last week Broadcasting Minister Kris Faafoi announced the names of a panel to finalise the business case for the merger of TVNZ and Radio NZ. It’s members are:

  • Chair—former NZ First party deputy leader Tracey Martin.
  • Broadcasting Standards Authority chair Glen Scanlon – a former head of news at RNZ.
  • Former MediaWorks chief executive Michael Anderson.
  • TV producer, former reporter  and member of Prime Minister’s Business Advisory Council Bailey Mackey.
  • Broadcasting and technology consultant William Earl.
  • Dr Trisha Dunleavy, Victoria University of Wellington media academic.
  • Producer Sandra Kailahi, former journalist at TVNZ’s Tagata Pasifika, Te Karere and Fair Go.
  • John Quirk, former chair and director of state-owner transmission company Kordia.

This panel has till mid-year to come up with its plan, to go to Cabinet before the end of the year. Its expected to allow for a mixed model of funding, with monies to flow to the merged entity from both Government and advertising.

Free-to-air broadcasting has seen a considerable decline in advertising revenue to the point where two years ago revenue versus expenditure at TVNZ was even. Consequently, TVNZ announced that there were not going to be paying a dividend to the Government. The decline had come primarily at the hand of online advertising, with Google, Facebook and other digital advertising channels benefitting at the expense of free-to-air.

Over the last couple of years, however, TVNZ’s revenue situation has improved, thanks to an improved share of TV market revenue , growth in digital advertising and a move to more locally produced content and a streamer-forced move away from acquired international content.

TVNZ had astutely recognised the value of a digital video platform and ploughed significant investment and resources into its Advertising Video on Demand service TVNZ OnDemand. In 2014 when NZ On Air started its ‘Where Are the Audiences’ research, TV2’s share of the 5+ audience was 27% while OnDemand’s was 7%. In 2020, OnDemand’s share was 21% while TV2’s was 14%.

Radio New Zealand meanwhile has gone from strength to strength. In 2020, a nationwide survey found that RNZ National has become the first New Zealand radio station to record more than 700,000 different listeners each week. CEO Paul Thompson attributed this to the public wanting a trusted source of news. Understandable in the era of fake news. RNZ has also seen growth in its digital channels.

The key concern for many is the merging of the non-advertising public broadcaster Radio NZ with the highly commercial public broadcaster TVNZ. The boards of the organisations reflect the non-commercial and commercial remits of the broadcasting entities.

If the panel wanted to stick to the adage of “If it ain’t broke, don’t fix it”, they’d leave TVNZ OnDemand and Radio NZ alone, most likely turn TV One into a true public free-to-air broadcaster, and dump TV2. But would the advertising revenue from OnDemand be sufficient?

Even with AVOD revenues in a number of countries expected to quadruple in the next five years, it’s doubtful OnDemand would make a big enough contribution to the bottom line with NZ’s small market.

The U.S.’s public broadcaster, National Public Media (NPM) provides a viable revenue-generation option. NPM, which includes National Public Radio (NPR), TV via Public Broadcasting Service (PBS) and their digital platforms runs a very specific kind of sponsorship and advertising model that is a proven revenue generator alongside a highly trusted public broadcaster brand. You can learn more about it here. Together with advertising-free content on TV One turned into Ad-supported content when moved to OnDemand, there probably would be sufficient revenues and maybe even some profit from the rejigged organisation.

Installing a completely new board for the new entity, putting RNZ CEO Paul Thompson in charge and making Kevin Kendrick responsible for the commercial arm—just like panel member Bill Earl was in charge of TVNZ Enterprises all those years ago—would play to their strengths as well. Kendrick would undoubtedly find other ways to generate revenue if he were willing to stay in essentially a demoted position.

I’ll be interested to see if my back-of-the-napkin business plan is close or wildly off the mark in July.

 

Tui Ruwhiu
Executive Director

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With the Big Screen Symposium about to kick off tomorrow, it’s yet another recent event at which to be thankful for, for our Government’s response to COVID. We can gather in big numbers will little concern for the spread of the virus, while in many other places around the world the statistics of COVID sickness and death are horrific. I was extremely pleased to hear yesterday that our Trans-Tasman cousins can now travel interstate, relatively freely.

 

And talking of our Aussie cousins, we have a new head at the Australian Directors’ Guild in Alaric McCausland. Alaric has a screen executive background in Australia and internationally, bringing a slightly different focus over his last two predecessors. As always, DEGNZ seeks a strong relationship with the ADG, with my first call with Alaric cordial, informative and supportive.

 

NZFC, NZ On Air and TMP obviously got more feedback than they bargained for in regard to the Premium Productions for International Audiences Fund. They are now late in getting the final criteria out—perhaps they will show at BSS. I have to imagine the number of applications to the fund is going to be as voluminous as the feedback was.

 

I heard yesterday that TV3 is now officially in the hands of Discovery. A Stuff article here. Being run as an Australasian service, it will be interesting to see what opportunities come for local content makers in the trans-Tasman tie, with Discovery’s global network and the planned launch of a streaming service here making for exciting possibilities.

 

Over at Sky they’ve got a new CEO in Sophie Moloney. Martin Stewart wears the blood splashes of his restructuring as he heads back to the UK, and Moloney offers an experienced, friendly, female and kotahitanga approach as she takes Sky forward. Unity is certainly needed in an organisation reeling from job losses.

 

TVNZ’s GM Local Content Nevak Rogers came with Drama and Scripted Comedy Commissioner Steve Barr to talk to our Emerging Women Filmmakers participants at their fifth and final workshop. Nevak was pleased to tell me that TVNZ is now spending around $100 million on local content, which is besting the highest spend during the Charter years at TVNZ. For those not old enough to know what the charter was, this from Wikipedia:

 

The Labour Government introduced a “TVNZ Charter” in 2002. This was a list of objectives for TVNZ which specified it must broadcast a wide variety of New Zealand-made content; the broadcaster was given public responsibility to provide news, drama, documentaries and “promote understanding of the diversity of cultures”. In 2008 the Government announced that the broadcaster was to become “more public-service” like. TVNZ responded by launching two commercial free channels; TVNZ 6 and TVNZ 7. By 2011 Prime Minister John Key announced the closure of these channels. 6 in 2011, and 7 in mid-2012, with much of their content put into TVNZ Heartland and TVNZ Kidzone24 which are only available behind a Sky TV paywall. The National Government abolished the Charter in 2011. Political opponents accused the Government of reducing TVNZ’s commitments as a public broadcaster.

 

Just this week at the NZ On Air end-of-year function, Broadcasting Minister Chris Faafoi reaffirmed his commitment to public broadcasting via a video address. Back in October, Faafoi announced that the TVNZ – RNZ merger discussion was back on the table. The partially completed and partially redacted PWC consultant’s report released in September, however, didn’t outline the benefits of combining the broadcasters into a single entity or state how TVNZ or RNZ’s services would change if the proposal was approved. Just what is going to happen and when seems entirely open to discussion. Dealing with COVID and its impacts provides wonderful cover for doing nothing for quite a while yet. Let’s hope something good comes of it sooner.

 

Finally, the DEGNZ Workflow Best Practice Guide, driven by board member and  long-time, drama and documentary editor Annie Collins, continues to win rave reviews. If you want to save your production time and money and yourself stress, become very familiar with the content, available on our website here.

 

Tui Ruwhiu
Executive Director

 

 

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You would think 28 days in lockdown would give you plenty of time to think. For me, it hasn’t as I have been extremely preoccupied along with a number of other industry people in the Pan-Sector COVID-19 Action Group, working on how to get the industry back into work. I can tell you that the weekends, and in particular Easter, were very welcome.

But as we head towards the fateful Day 28 of Wednesday—which could very well pale into insignificance at 4pm today—I would like to reflect right now on what it was like before and what it will be like after Coronavirus.

I’m a Boomer. I’ve never known war, although my brother and his friends did have to give some thought to how to avoid ending up in Vietnam. The closest I’ve gotten to a bomb was when I arrived at my Soho hotel in London the day after the nail bombing of the nearby Admiral Duncan pub by a Neo-Nazi. I was living in Tokyo though when Shoko Asahara and his Aum Shinrikyo cult unleashed Sarin gas attacks on the Tokyo subway system, killing 13 and injuring thousands of others—I got to report it, not experience it, luckily.

Still, none of this compares to the devastation that COVID-19 has wrought on the world. Some have referred to it as the World War of the 21st Century without a visible enemy. Sure, we’ve had to queue for food like they used to during World War II, but we can still choose between a Savvie, a Chardie or a Pinot. Hardship? Not in this sense, to be truthful. But economically, a definite “Yes!”

Of course, like many people I’ve had financially difficult times in my past, but it’s always been up to me to get out of them and it was always possible to do so—the economic environment even during the GFC was never as bad as it is now for all of us.

Most of us in the screen industry, myself included, are contractors. I’m fortunate in that the Guild still has paid work for me to do, albeit on reduced hours that I voluntarily instituted to help out (I’m still working fulltime, though). My wife’s small business has gone from a comfortable sole trader income to almost zero. Many of you have no income right now except for the Wage Subsidy. I hope that you have all applied for and received it. And if you were declined, please ensure you entered the correct IRD number and are classified as a sole trader and not an employee. One of these could be the reason why you were declined.

Can we go back to the old normal? Even with a vaccine, it doesn’t seem possible. So what’s in store for us all in the screen industry in the new normal?

It’s clear now that the world is suffering from a lack of content. Broadcasters, streamers, cable, AVOD, TVOD—they all need it. From Israel to Bulgaria, the UK and the U.S. to Argentina, Australia and to a minor extent New Zealand, development is in overdrive and everyone is getting ready for new production to feed the Content Beast that’s starving.

Andrew Shaw, General Manager Commissioning and Production at TVNZ recently told me that internationally, existing content that had been passed on before is being re-examined in a new light. This means opportunities for sales offshore that producers might not have been able to secure previously. Then there is also produced material that hadn’t yet gone to market. All this will run out in quick time, however, and reruns are reruns no matter how you look at it.

As I’ve said before in this column: With great change comes great opportunity. But you’ve got to grasp it with both hands. Everybody internationally is gearing up to do so.

Jeffrey Katzenberg has grabbed the opportunity with Quibi, the new short-form content platform that’s just launched. Katzenberg took big risk in founding the successful Dreamworks with Spielberg and Geffen when it was considered insane to start a studio without an archive. Prior to that he took a massive punt with Roger Rabbit when he was Chairman of Walt Disney Studios. As a former professional gambler, Katzenberg was used to betting the bank. Being a card counter, you can understand that he always had a strategy to win. So, what about the New Zealand strategy to grasp all the opportunity and win in the screen industry?

Well, one was mooted before COVID-19 hit. And we have it now in the draft strategy released two weeks ago. Granted, it was formulated prior to COVID-19, so it should be measured upon that. And I’m happy to do so.

My personal opinion—and, I am at pains to point out, NOT DEGNZ’s position—is that it’s a document lacking in vision and the independent spirit of the New Zealand screen industry, being full of bureaucratic intentions rather than specific, entrepreneurial action plans needed to truly move the industry forward. The advent of COVID-19 means it now must be rewritten. And we have once again been provided an opportunity to feed back, which I encourage every single person to take.

So what might the New Normal look like that we need to strategise about?

On the film side, which is so dependent on theatrical exhibition, it’s a changed world. Sales agents are making sales but no longer paying Minimum Guarantees for films—essentially deposits that were used to help finance features, and producers were required to have.

Distributors are selling to streamers, broadcasters and others, but as Elizabeth Trotman of Studio Canal said in a Screen Producers Australia (SPA) interview two weeks ago, they were really dependent on blockbusters to make money because independent film didn’t pay. How to move from that old business model and into the new environment is something StudioCanal are thinking hard about. Paul Wiegard, co-founder of Australasian distributor Madman, said last week in another SPA interview that they are in a fortunate position because they have their own streaming platforms in DocPlay and AnimeLab, and other diversified revenue streams. While passionate about narrative feature film, Wiegard was more optimistic about documentary. In the end, he was clearly uncertain about theatrical exhibition for narrative features at this point.

The future of theatrical exhibition is decidedly unclear, with many exhibitors headed towards bankruptcy. Social distancing won’t help theatrical survivors to persuade customers back into theatres, and it certainly won’t deliver the box office they, the distributors and the studios will need. Independent film—and that is all New Zealand film—has a decidedly sketchy future for the foreseeable future unless it can find a home on a digital platform, pay channel or free-to-air broadcaster. And the NZFC requirement for theatrical release to get financing will obviously have to change.

On the television side, we will likely see a merged TVNZ and RNZ sooner rather than later. It’s clear public broadcasters have an unrivalled position when it comes to News and Current Affairs when the chips are down. And TVNZ did a very good job in building TVNZ OnDemand, a platform they can monetise, and HeiHei in partnership with NZ On Air. They are in a good spot. Let’s hope the Government gets the mix right. Our futures as television makers depend on it.

NZ platforms though are suffering a lack of content, just like their international counterparts. There’s only so much self-isolating content we can all take. With a transition to Level 2, we will likely see an increase in documentary and unscripted first, then drama as we find ways and means to operate safely in larger numbers. The stimulus package for the NZ screen sector now being talked about will absolutely be needed if we are to climb our way out of the hole we are in and back into production.

Private, free-to-air broadcasters and media organisations are struggling with the massive decrease in advertising, although SKY’s subscriber platforms are helping them to weather the storm. Private media is looking to the Government to rescue them and they should hear about their package soon.

Production for the international market in New Zealand is one of the tougher nuts to crack. On the one side, for serviced production we have to get the international talent into the country to complete projects and to start new ones. On the other side, we don’t have sufficient talent here for local production of internationally-focused shows. And the opportunity for locally-produced global shows seems to be rapidly closing. We don’t yet have the funding and processes from our funding bodies to really take advantage of the international opportunities. Hopefully, we will see changes soon enough for New Zealand producers to exploit.

The big problem facing us all is cost and how that’s paid for. Increased Health & Safety should mean new line items to the budget and increased shooting days, not greater demands on directors and editors (and other crew) to do more for less. The funding bodies understand this, and are looking to ask for more. But in an environment when every sector needs assistance, there’s only so much largess the Government can provide. Meanwhile we are back where we were a few short years ago when DEGNZ with the NZ Writers Guild waged a battle against digital platforms and producers working with measly budgets and grabbing all rights.

So here we all are, sitting with bated breath waiting for a Government announcement that will decide our immediate fate and shape our long-term future. It’s not all grim. As Queen Elizabeth said in her address, “We should take comfort that while we may have more still to endure, better days will return.”

For all of us, I’m sure that those better days can’t come soon enough.

 

Tui Ruwhiu
Executive Director

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It has been a big year for DEGNZ and the Screen Industry.

At the Guild we have unionised, and we have recently been accepted by the New Zealand Council of Trade Unions (CTU) as an affiliate. We are now well poised to represent New Zealand directors and editors in negotiations over minimum rates and terms and conditions should the proposed legislation go through next year that will allow collective bargaining for contractors. There are a number of other key benefits to our unionising. We are much more closely aligned with the New Zealand Writers Guild and Equity New Zealand, both of who are also unions and affiliates of the CTU. As representatives of three of the four above-the-line creatives, we have many common interests when it comes to our relationships with producers. The CTU has experience, expertise and resources we can call upon. And internationally, we now have have equal status with the Directors Guild of America, the Directors Guild of Canada and the Australian Directors Guild, who are also labour unions.

DEGNZ became a founding member of the Alliance of Asia-Pacific Audiovisual Writers and Directors (AAPA) following DEGNZ’s attendance in May at the General Assembly of the International Confederation of Societies of Authors and Composers (CISAC) and the Executive Committee Meeting of Writers and Directors Worldwide (W & DW). This has already paid dividends with the Director General of CISAC Gadi Oron here last week to help us lobby the Ministry of Business Innovation and Employment (MBIE), the Minister of Broadcasting, Communications and Digital Media Kris Faafoi and others over director’s copyright and fair remuneration for authors as the Copyright Act Review continues. Gadi is a lawyer and copyright expert and brings an important international perspective to the deliberations.

The Guild continues to input into the Film Industry Working Group (FIWG) as drafting of the proposed legislation to go to the House is finalised, and we have made considerable effort to put our views across as the NZ Screen Sector Strategy 2030 has gone about its work. DEGNZ board member Michael Duignan has played an important role with the Strategy as a member of its Facilitation Group.

DEGNZ worked closely with Equity as it updated its Guidelines for Nudity and Intimacy on Stage and Screen, and Guild board member and South Island representative Louise Leitch went through the full training conducted by UK Intimacy Coordinator Ita O’Brien on best practise guidelines for intimacy, simulated sex and nudity on set. Louise ran her first workshop for this in Christchurch in November, and we will look to her to continue this work so that all directors can have the opportunity to upskill in this critical area. As well, we maintain ongoing feedback to the Screen Women Action Group (SWAG) as it goes about its efforts to change the culture that enables bullying, harassment, discrimination and other abuses of power over women in the screen industry.

2019 was the third year we ran the Emerging Women Filmmakers Incubator to help address the poor numbers of women directing feature films in New Zealand, and to help female directors advance their projects and careers. We have now seen 23 women go through the Incubator to date and there has been good progress:

  • One has made her first feature,
  • one has just received production finance for her first feature,
  • one has gone on to work regularly as a TV drama director
  • one has moved into directing commercials as she continues to pursue feature directing,
  • one has entered the Shortland Street Directors Programme,
  • one will direct her first TV drama on a U.S. series next year,
  • two have entered the NZ Advertising Producer Guild’s Female Commercial Director Mentorship Programme

and all the others are driving forward on their careers and projects. We still have a ways to go to address the inequities in the numbers of women having sustainable careers as directors, but we are making some headway.

We maintain an extensive professional development programme for directors and editors. In particular, we have honed in on post production workflow and assistant editors as this has proven to be a problematic area because of the technical knowledge and skill required to ensure projects run effectively and eficiently. Our work on this has been driven by our three editor board members Annie Collins, Francis Glenday and Margot Francis. These three are also shaping the  standard feature film editor agreement we plan to make available in the first quarter of 2020.

As we close out the year we have just learned that Minister Faafoi will not be making an announcement about the future of TVNZ and RNZ. We expect that the merger will go ahead but there is obviously a significant cost associated with this, and it will be on an annual basis, not a one-off. The article on the RNZ website today mooted the possibility of increased funding for NZ On Air. This would be welcomed by many, as would an increase in funding for NZFC who have far greater calls on monies than their budget allows for. We shall have to wait and see.

I want to thank the membership for their continued support of the Guild in 2019. DEGNZ is committed as our slogan says to the creative, financial and cultural wellbeing of New Zealand directors and editors. We have a dynamic board in President Howard Taylor, Vice President Louise Leitch, Treasurer Phil Gore, and board members Annie Collins, Michael Duignan, Margot Francis, Francis Glenday, Roseanne Liang, Robyn Paterson and Gabriel Reid who work voluntarily and tirelessly on our behalves and have been tremendous support to me throughout the year.

I also want to thank my Events and Marketing Manager Tema Pua and Accounts person Caroline Harrow who keep the Guild operations functioning smoothly.

Thanks also go to the other guilds and associations we have worked with across the year, whether it be in our workshops, seminars and networking and social functions, or on the bigger picture representations we have made such as the FIWG and Screen Sector Strategy. We are all in this together even though we may have different perspectives and positions.

Finally, I want to extend our gratitude to our core financial supporters the New Zealand Film Commission, NZ On Air,  Vista Foundation and the Australian Screen Directors Authorship Collection Society, without who we would not be able to deliver many of the services we do, and to our other sponsors accounting firm VCFO Group and Dominion Law.

Wishing you all a Meri Kirihimete and a Happy New Year for 2020!

 

Tui Ruwhiu
Executive Director

 

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As Minister of Broadcasting Kris Faafoi gets set to decide the New Zealand broadcasting industry’s future with hopefully sound advice that includes a note that the industry is more than just News and Current Affairs, I postulate further on possible answers to our dilemma to stimulate further debate and discussion.

Countries with strong public broadcasters are those with compulsory broadcast licence fees. In Denmark, with a population of just over five million, the licence fee of €332 (NZ$579) generates €4.4 billion (NZ$7,671,308,423). Danish public broadcaster DR operates six TV channels and eight radio channels with this revenue. Norway, which has a similar population to Denmark, has a licence fee of €315. Its public broadaster NRK runs three national TV channels and three national radio channels. Countries that still have licence fees include the U.K., Germany, France, Spain, Ireland, Switzerland, Japan, Italy, the Netherlands and South Korea.

A licence fee in New Zealand of just NZ$125 applied to the estimated 1,765,100 households in the country would generate nearly $220 million dollars annually. This would cover the costs to fund Radio NZ ($35 million) and Māori Television ($45 million), administer the licence fee (est. $20 million) and leave $120 million.

If the $120 million were combined with Radio NZ’s $35 mil., a newly created public broadcaster would have $155 million of muscle. This entity could deliver quality News and Current Affairs (est. $50 mil.) and would have $105 million—almost the same level of funding NZ On Air has after the ring-fenced Radio NZ funding is deducted—to create a Public Broadcaster Fund to make great factual and scripted programming for both domestic use and international sales. To help secure the independent production sector’s future, this broadcaster could be required to outsource for factual and scripted ideas and their production. Sales revenue could go back to the broadcaster and the independents to contribute towards their sustainability.

In an added approach, the Government could continue to fund NZ On Air the annual $115 million it now receives. This NZ On Air Fund could be contestable and exclusively for the commercial channels and platforms, both Free-to-Air and those with paywalls. Once again, independent producers could pitch on this contestable fund with a percentage, say 75%, being ring-fenced for the independent sector.

The commercial channels and platforms could be required to pay a commercially appropriate licence fee for this content that acknowledges the real value that local NZ content would bring to them. After all, they are commercial with the Free-to-Airs able to scoop up any advertising revenue going, while the SVODs would get the subscription revenues. Funding levels would be determined by the quality of the idea, the scale of the proposed production and the audience size.

A means to extract revenues from streamers and international serviced productions coming here would need to be found to decrease and hopefully eventually eliminate Government funding in the NZ On Air Fund.

The Public Broadcaster Fund and the NZ On Air Fund should allow for access to the New Zealand Screen Production Grant (NZSPG) so that producers can more easily pitch and finance shows that have truly global potential. The NZ On Air Fund should retain the current NZSPG requirements of 25% or more of non-NZ production funding and a minimum of 10% market money to ensure the shows have real international appeal. And while we are at it, the NZSPG’s Qualifying New Zealand Production Expenditure (QNZPE) minimum should be reduced from $2.5 million to $500k so that films with lower budgets can access NZSPG. Some thought may well have to be given to the QNZPE for TV as well.

The above could potentially solve a number of issues:

  1. Give us a well funded public broadcaster.
  2. Ensure that the independent production community would still exist and be able to make the most of opportunities both domestically and internationally.
  3. Allow the commercial broadcasters and platforms to live to fight another day with all the advertising revenue available while giving them valuable local content.
  4. Make the streamers and international productions contribute to the growth of local IP and production.

All that’s needed for this to occur would be for the NZ public to buy into the need to pay a licence fee.

I would.

Would you and everyone else?

Tui Ruwhiu
Executive Director