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Is It Time for TVNZ to Revert to Public Broadcasting?

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My op-ed this week is devoted to personal musings in the lead up to the NZ Screen Sector Strategy hui, and the changing nature of the screen industry as we know it.

Colin Peacock on the Radio New Zealand website wrote on the weekend about ‘Convergence’: what it is and what it has led to—telecommunications and broadcasting merging due to digital technology and the Internet.

One outcome of the convergence that’s happened here, which I wrote about last newsletter, was the TVNZ board reporting to Government that it will not be paying a dividend for the foreseeable future.

In the same RNZ convergence article, TVNZ CEO Kevin Kenrick is quoted as saying that TVNZ will refine the data from TVNZ OnDemand users to allow advertisers to tightly target ads to online viewers.

Following last year’s revamp of TVNZ OnDemand, RNZ also reported Kendrick as saying, “Consumers of online video are pretty clear they pay with their wallet, their data or their time. We’re in an ad-funded world.”

With no profits in sight and the Government forgiving TVNZ its requirement as a state-owned company to deliver a dividend, is it time to turn TVNZ back into a public broadcaster and forget about advertising as the main revenue stream?

If convergence is the reality, how about converging ONE, TVNZ 2, DUKE, TVNZ OnDemand and Radio NZ into a new media powerhouse for public broadcasting? Let’s call it Aotearoa Media Powerhouse – Digital (AMP-D) for ease.

The commitment by Kendrick to a significant increase in local content, the mix between local and international shifting markedly towards local, and investment in an online future while making that content available across more devices would make absolute sense for AMP-D. This would parallel the efforts the BBC and the Australian Broadcasting Corporation (ABC) are making to survive.

Granted, TVNZ would be moving from a business that cost close to $300 million to run in 2018—essentially what they earn from advertising—to a public broadcaster that has to find other ways to earn revenue.

How about an AMP-D Studios along the lines of BBC Studios, whose remit is to produce and market programmes not only for the BBC, but for other broadcasters on the open market at home and internationally, returning profits back to the BBC. AMP-D Studios would give the commercially inclined at TVNZ a new playground to play in.

Perhaps the greatest benefit to AMP-D is we’d get away from this navel-gazing that differentiates New Zealand content for local audiences, which is fragmenting away before our eyes. AMP-D Studios and independents could produce programming that is—to steal something else from the BBC—distinctive (in our case NZ), world-class content. Why couldn’t AMP-D Studios generate shows like The Killing, The Bridge and Borgen, produced by Danish public broadcaster DR, which sold all around the world? There’d have to be a cap to how much of the public purse AMP-D Studios could get, though.

AMP-D could also generate news and current affairs nationally in a revenue generating service to commercial media companies, much as the NZ Press Association and the worldwide video news service Visnews did previously. This would allow the commercials to put their own spin on the content without the major cost of resourcing.

AMP-D OnDemand could have two operational tiers: Subscriber Video On Demand (SVOD) that’s ad-free and costs a monthly fee, and Ad-Supported Video On Demand (AVOD) that carries advertising in a free-to-air service. Hulu already operates this hybrid system.

In such a new environment, it would make sense for NZ On Air and the NZ Film Commission to ‘converge’. Let’s call this the Aotearoa Media Fund (AMF). AMF could manage the discretionary funding allotted to it to spend between broadcast, digital audio-visual content for the Internet, film and radio.

To really power AMP-D up, AMF could be required to stop funding content on the commercial platforms, dedicate its funding to AMP-D and meet its requirement to deliver great New Zealand content that is valued and enjoyed by many New Zealand audiences on multiple public broadcasting platforms. A cap in funding for internal production for both screen and radio content could be levelled to ensure independent production companies could operate in the new environment.

AMP-D could benefit local feature films by being required to carry all films funded by AMF, guaranteeing free-to air play to New Zealand audiences for every NZ film, which doesn’t happen now. The best films would get significant marketing and promotion. The not-so-good would get buried in AMP-D OnDemand—the same for not-so-great content on Netflix—where they’d sit for those still interested enough to search them out. (Smart Kiwi producers could take a page out of Norwegian producer Anders Tange’s book on how to build an audience independently of a streamer as he did for his Viking comedy Norsemen on Netflix.)

It’s almost certain that there would be an increased cost to establishing and running AMP-D that would take a long time to mitigate if ever, even with the efficiencies of a combined entity. That would be the cost of continued existence.

But perhaps it might be useful to compare New Zealand content and its industry to the kakapo — an endangered species that’s potentially headed towards extinction if we don’t do something paradigm-shifting to save it.

“What about us?”, the commercial platforms here would scream?

Frankly, it’s a fight for survival and we have to ensure first and foremost that our content and our platforms survive and flourish in the brave new world that’s upon us. Sorry, you commercial guys, you’re going to have to sort it for yourselves. Or maybe ‘converge’.  And if they withered and died, maybe it would all be for the better for AMP-D. After all, it would still have to face Netflix, Amazon Prime, Disney +, HBO +, Hulu and others. Heck, AMP-D might even have to team up with the public broadcasters in Australia, Canada, the UK, the U.S. and elsewhere to live to fight another day. Such collaborations are already happening in Europe.

I’m happy for anyone to shoot holes in my postulations above. I’ve only spent a couple of hours daydreaming, not weeks and months devising a strategy. The intent is to get you to do more thinking about our industry with the screen sector strategy upon us. We can now imagine our own futures and let Government know.

We are going to be sending out the list of questions I wrote about in the last blog to everyone on our database. We want your thoughts about the direction the New Zealand’s screen industry should go. So please take the time to ponder, write to and or tell the Screen Sector Strategy NZ and DEGNZ your opinions. We’ll make sure we collate them and submit them from the Guild along with our thinking, so that we all have a say.

Tui Ruwhiu
Executive Director

Are We Missing the Streamer Boat?

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It’s hard not to bang on about streaming services when they are continuing to upend the screen industry as we know it.

Media intelligence service FilmTake recently reported that Disney, WarnerMedia, and Apple are expected to spend between US$8 million to $20 million per episode on new drama series.

Amazon has supposedly set aside over a billion US dollars to bring a five-season Lord of the Rings series to Amazon Prime.

There are other epics planning to cash-in on the void left after the conclusion of Game of Thrones include WarnerMedia’s Dune series, Showtime’s Halo, and Apple’s fantasy series See.

Disney+ is also producing a Star Wars series, Mandalorian, which is costing $15 million per episode.

And these are just the TV blockbusters.

The Financial Times reported that in Europe, Netflix will make 221 projects in 2019, including 153 originals.

Netflix has launched its first European production hub in Madrid, targeting Spanish-language production and drama series, which have been a priority and a large source of success for the U.S. streaming giant.

In July of this year, it also announced that it is creating a dedicated production hub, featuring 14 sound stages, workshops and office space, at Shepperton Studios in the United Kingdom.

In the last year alone, over 25,000 cast, crew and extras have worked on almost 40 Netflix originals and co-productions across Britain.

New Zealand is certainly not missing out on service production for streamers as witnessed most recently by the noise about the Lord of The Rings TV Series potentially being shot here for Amazon. Netflix has already been here with Letter For the King and is currently shooting another.

But are we missing the boat with local IP to satisfy the booming global appetite for content, particularly drama?

Yes, local producers do continue to sell their NZ ON Air and TMP funded content internationally, but that’s been the case for many years now.

NZ formats for the international market have made headway, as most recently attested to by Filthy Productions’ sale of Filthy Rich to the Fox Network.

It’s easy to forget that Rob Tapert has been making TV shows here for the international market for over 25 years—everything from Hercules and Xena to Spartacus and Ash vs Evil Dead.

But there’s nothing new in all this, as it was happening prior to the advent of Subscription Video On Demand (SVOD) services like Netflix and Amazon.

While NZ On Air continues to do the best it can with limited funds for local drama, it’s essentially locked into a myopic approach by its adherence to the Broadcasting Act, and it doesn’t look like it will change that anytime soon.

But there is a little light at the end of the tunnel.

Screentime has forged into Scandi Noir with its Danish coproduction Straight Forward, now on TVNZ OnDemand, and its soon to be released copro The Gulf, with Paula Boock and Donna Malane’s Lippy Pictures and a German partner.

And we have seen one Netflix Original in Auckland-based Razor Films’ Dark Tourist, while See-Saw Films and Jump TV are into their second series of The New Legends of Monkey for the ABC, TVNZ and Netflix. Almost going unnoticed is Pango Production’s 2018 production All Or Nothing: New Zealand All Blacks for Amazon Prime.

But really! Can we survive the onslaught of service production work from streamers in New Zealand and get our own IP out there in more than an occasional way?

There are a number of factors holding us back and one of them is writers. We don’t have enough skilled writers with the experience required to get internationally-focused shows across the line. The NZFC/NZ On Air Raupapa Whakaari Series Drama Lab initiative is seeking to address this by bringing in international-calibre mentors to work on local show ideas with teams here. Hopefully this will bear fruit.

Another is lack of funding. NZ On Air production funding caps out at $6 million, and you can’t access the NZ Screen Production Grant and NZ On Air Funding for the same project. When even middle-of-the-road Aussie shows are being made for the international market at AUD $1.5 to 2 million or more per episode for 6 to 10 eps, you can see the problem. But before you get to production you have to go through development, and the cost for that is going to be anywhere between $300,000 to $500,000. Again, there’s not the funding here for that. Raupapa Whakaari’s matched funding is limited to NZ$50,000 per year.

You might well ask why do we need to create our own IP anyway, and not just be service providers for international productions?

For directors and editors there’s going to be more work on local shows than international ones. The post production is generally not done here for international shows, and there’s only a very small pool of Kiwi directors with the credits to get themselves hired on international productions. That will expand slowly over time, but local shows hire locals, and we are increasing the numbers of Kiwi directors working on NZ On Air dramas.

In the end though, it’s our distinctiveness as Kiwis with Kiwi stories to tell and landscapes to show that provides cut through in the international market. I’m paraphrasing Paula Boock of Lippy Pictures who participated on our Screenlink panel this week along with Mark McNeill of Razor Films and Steven Zanoski of Filthy Productions to discuss ‘Screen Content for the Global Market’. Locally owned IP also brings revenues back to New Zealand when it’s successful, long after production has finished.

I don’t think we are going to miss the boat entirely when it comes to creating our own shows for the streaming giants. But it does sometimes seem like we are standing at the end of the pier watching the ship sailing away and wondering how the hell we are going to get onboard.

Tui Ruwhiu
Executive Director

 

Watch: Writing & Directing Fresh Eggs for TV

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Go behind-the-scenes into the creative process of making Fresh Eggs with co-creator/writer Nick Ward and producer/lead director Britta Hawkins. Fresh Eggs is a six-part black comedy for TVNZ 2, which follows a couple’s quest for “the good life” that goes wickedly awry. Q&A moderated by Gaysorn Thavat, another director on the show.

 

“If you’re ever doing a story table, ever working with other writers, just never say, ‘no’. Never ever say, ‘no’. The minute you start saying, ‘no’, is that’s when things get really messy.”

– Nick Ward

“There were lots of things that we did differently. We three directors ended up working as like one ensemble cast of directors, which is also not typical. Normally you come in and you do your block and then you go away. And you tend not to cross paths with the other directors at all.”

– Britta Hawkins

 

This event was part of DEGNZ’s Screenlink series, hosted with the New Zealand Writers Guild.

Carving Out a Public Broadcasting Audience

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New Zealand On Air’s Where Are the Audiences? 2018 Report makes for interesting reading.

If you haven’t already seen it, the key findings for the screen industry are:

  • Weekly audiences for traditional broadcast media are stable, and continue to deliver the biggest audiences.
    – But the gap to online video and SVOD is closing.
  • The weekly reach of SVOD has nearly doubled since 2016 – now reaching more than 6 in 10 people.
  • On a daily basis, linear TV has declined – driven by a fall in Sky TV penetration (Free-to-air actually grew 9%.)
  • Daily more people view videos on sites like YouTube and Facebook than read a newspaper.
  • On Demand viewing is stable but there’s a growing use of this as a content source, as opposed to catch up viewing.
  • New Zealanders still spend the most time each day on traditional broadcast media – 2.5 hrs watching linear TV, 1.5 hrs listening to radio, compared to 62 minutes on SVOD.
  • There’s significant behaviour difference between under 40s and over 45s, but the generation gap is closing as older New Zealanders adopt new tech.

So what does this mean for public broadcasting, particularly as it relates to TVNZ and Radio New Zealand?

As Sky subscriptions fall there has been a positive effect on free-to-air TV, particularly the daily reach of TV One. Conversely, the daily reach of TV2 and TV3 is declining dramatically, while Prime remains steady and Maori TV shows slight growth.

TV One is definitely the strongest TV brand and will, therefore, be the biggest revenue earner in the free-to-air space. Their On Demand offering is working, as attested to by the growth it’s achieving. Two though is languishing and looks to be going the way of Four, which is over and out, as does TV3.

TV One is the dominant free-to-air player as a commercial entity, much to the chagrin of Mediaworks CEO Michael Anderson who is doing his best to convince anyone who will listen that TV One should be turned into a public broadcaster. He knows the writing’s on the wall if he doesn’t get the changes he wants. But should One become the public broadcaster? Or would it be better to be flicked while its star is at least glimmering. There again is the elephant-in-the-room question of what to do about a public screen broadcaster.

Radio NZ is holding its own as a radio station. While Radio NZ’s daily reach is dropping, its audience share remains strong and it’s the single most popular radio station. RNZ is also increasing its online video content offering, which has been strengthened by the extra funding for commissioned programming recently announced.

Does TVNZ’s On Demand success hold the answer? As would be expected, SVOD’s weekly reach is up dramatically according to the report, and TVNZ On Demand is showing growth, not just for Catch Up but also as a content source.

If Radio NZ had a digital On Demand platform that offered a significant content source for ‘free-to-air’ programming and built its eyeball numbers to rival or surpass TVNZ’s On Demand, then we’d be in a place where quality programming could access NZ On Air funding without the commercial imperative that controls what does and doesn’t get made currently.

I’m clearly better on the questions than the answers, but I’m certainly not the only one trying to figure out how to take advantage of the global changes sweeping the TV industry that still haven’t really arrived here.

If you’ve got some bright ideas, let me know.

Tui Ruwhiu
Executive Director

RNZ Minus?

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When Broadcasting, Communications & Digital Media Minister Clare Curran announced her plan to ramp up Radio New Zealand to RNZ+ with additional funding of up to $38 million, there were a lot of smiles out there including on my dial. I love Radio NZ and spend all of my driving time—and that’s a lot of course in Auckland—listening to it.

Equally, there is a lot of concern about what this actually means.

Nobody including me wants to see large chunks of money spent on hardware to build a free-to-air public media TV station to play out linear programming. That sentence there has a number of conundrums worth exploring.

Is it expensive to actually build a TV station? Not necessarily. Having peripherally or directly been involved in three digital channels, I can unequivocally tell you there would be a lot of change from $38 million. However, to feed a TV station with content is like feeding a beast. It consumes everything in its path 24/7 or however many hours you are programming for.

The best way to do it is to buy already made content, which generally comes from offshore because it’s cheaper than making it. Then you can of course rotate it in blocks of four or multiples of, to fill a 24-hour day, and introduce new content to whatever your change in/change out strategy is. That doesn’t help local content makers, though, which is why we have NZ On Air.

You could of course hold up the Maori TV model and say, look at all the local content they are making with the $33 million they get. The immediate reply would likely be, look at the quality of the material that often comes out of there and what Maori Television Service has done to budgets and rates of pay for the programme makers who do the work—that’s potentially the path to devastating the whole industry and certainly not what we want from any RNZ+.

A more important question doing the rounds right now is why build a new channel at all? TVNZ is government owned and TV One could be the free-to-air public broadcaster it should be. This had been proposed by NZ First. It would seem the Minister views the commercial culture of the organisation as a key reason for that not happening, and therefore the need to build a public broadcaster in the screen space out of RNZ.

The simple suggestion mooted in some quarters to fix TVNZ is to replace the board and top management and everyone else in the organisation will fall into the public broadcaster line that the new lot would institute. There are a lot of sceptics about this thinking, including Clare Curran obviously. But it’s not as simple as it sounds, I believe. There would be a lot of complexities involved in moving ONE from it’s commercial positioning to a public broadcaster, which may or may not see change from $38 million. But worth looking at perhaps if it hasn’t been done already?

Then you have to consider what free-to-air actually means. In the People’s Public Media Report, a joint effort between Action Station and the Coalition for Better Broadcasting, presented to Government in December 2017, panellist and independent producer Kay Elmers wrote this:

As we move away from using public money to fund content for free-to-air broadcast delivery platforms, and increasingly fund content that is delivered online only, we have a fundamental problem that this publicly funded content is no longer freely accessible to all citizens.

In talking to Kay about this, she explained that if you have to pay to have data or Internet access to get online content then that’s not free-to-air—with TVNZ or Radio NZ, you only need the hardware to receive the programming. This is a key point of differentiation.

Another key consideration is what does public media mean? Wikipedia’s take, which comes from the widely accepted British definition, has as principles:

  • Universal geographic accessibility
  • Universal appeal
  • Attention to minorities
  • Contribution to national identity and sense of community
  • Distance from vested interests
  • Direct funding and universality of payment
  • Competition in good programming rather than numbers
  • Guidelines that liberate rather than restrict

But, when you read the paper put to cabinet by Minister Curran or the terms of reference provided by her for the just appointed Public Media Advisory Group who will look into the role and scope of the mooted Public Media Funding Commission, you can see an emphasis on news and current affairs and less on the wider content scope that makes up public media in totality.

Drawing on the People’s Public Media Report again, this time from panellist and long-time news and current affairs broadcaster Mark Jennings:

It [public service media] is now seen as perhaps the last bastion of independent, quality news and current affairs, in a media world that is collapsing under a deluge of click-bait and the impact of failing financial models.

So is the Minister throwing out the baby (broad public media content that keeps many of us employed) with the bathwater (TVNZ) to provide quality, independent news and current affairs on an energized Radio NZ (RNZ+)? Here’s hoping the Public Media Advisory Group looks into this. Or do the redacted bits in the cabinet paper (apart from those hiding the group member who withdrew) make RNZ+ a fait accompli?

Another conundrum to discuss: Is there a need for a public media linear channel for RNZ?

When asked by STUFF about it in October last year:

“RNZ chief executive Paul Thompson said RNZ was doing ‘television-like things.’

“We see that growing and improving

“Whether that translates into a fully-fledged, ‘old-style’ linear channel, I am unclear and I probably think it is not necessary given where the market and technology is going.

“Even before taking the new policy into account, we were moving down a path of having more audio-visual delivery of content live and on-demand,” he said.

“This policy would probably accelerate the development of our multimedia plans, but the definitions of what a television channel is and what audiences want and need is changing really quickly and we would have to take that into account,” he said.

Thomson reiterated this in a boisterous select committee hearing last week reported by NEWSROOM, although Curran wasn’t letting them completely off the hook when she added that a free-to-air linear station might be an option “down the track.”

I for one subscribe to Thompson’s approach to the RNZ+ offering. It won’t require major infrastructure spending, and would mean the majority of the new funding RNZ would get from the $38 million could be spent on news and current affairs content.

More importantly, this tack would leave NZ On Air as it is and hopefully provide them with a significant chunk of the $38 million to spend on other local content that is not news and current affairs, rather than receive insignificant funding, which won’t do anyone any good.

There’s a conspiracy view out there that a coterie of grey-bearded academics, embittered former public broadcasters and others have it in for NZ On Air and want it done away with entirely. Every working person in the screen industry I have spoken to about this so far feels that would be absolutely disastrous. As much as we bemoan NZ On Air when they say “No” to our proposals, there is almost universal agreement in the screen industry that it’s efficient and effective, must be kept, and given a lot more money to play with.

We all need to keep a close watch on developments around RNZ+ to make sure we will continue to get a good volume of quality NZ content, including independent news and current affairs, and a real public media offering, all the while ensuring we don’t slide into screen poverty with lower budgets and rates.

Tui Ruwhiu
Executive Director