Author: Gavin Ellis

Gavin Ellis is a media consultant, commentator and researcher. He holds a doctorate in political studies. A former editor-in-chief of the New Zealand Herald, he is the author of Trust Ownership and the Future of News: Media Moguls and White Knights (London, Palgrave) and Complacent Nation (Wellington, BWB Texts). His consultancy clients include media organisations and government ministries. His Tuesday Commentary on media matters appears weekly on his site www.whiteknightnews.com

BUT WAIT…THERE’S MORE (BEING SUCKED AWAY)

First there was Dracula, followed by Nosferatu. Buffy the Vampire Slayer despatched a few, but then we were shown What We Do in the Shadows. However, for the cold-hearted realities of vampirism, nothing beats that on-going series The Advertising Standards Authority’s Advertising Turnover Report.

In a chillingly sangfroid fashion, its latest episode indicates that yet again the transnational platforms have sunk their fangs ever deeper into the media’s jugular.

I have been charting the ad revenue fortunes of the New Zealand media almost since the birth of the Advertising Standards Authority in 1990 and have been paying particular attention to statistics since 2007. That was the year that newspaper and television ad revenue peaked and also the year we started to see digital platforms posting exponential increases in their annual take.

In 2007 those platforms – the likes of Google and Facebook – attracted a relatively modest $135 million. Last year their share of the advertising spent was $2.171 billion. By comparison, the newspaper share has dropped from $826 million to $274 million while television had dropped from $654 million to $490 million. In total, the digital-only spend last year was almost twice that spent on all other advertising. Let’s put that is some perspective: The last time New Zealand media recorded a total as low as what they earned last year ($1.1 billion) was thirty years ago.

Only radio has been holding its own in advertising revenue, but it has been basically flat lining for the past decade. It has bumped along at between $260 million and $280 million a year, apart from the COVID dip experienced by all local media (but not the digital-only platforms). It was up $5 million in 2024, but $4 million below the $276 million it recorded in 2022. Allowing for inflation, even radio is not in the best of health.

Admittedly, the digital-only gain for 2024 was slightly down on the previous year – up a mere $59 million against the previous year’s $87 million. That could mean there are signs that the rate of growth may be slowing. Alternatively, it could be only a sign of the economic times and recovery will signal a return to exponential growth.

Either way, the lifeblood is being sucked out of most of the media on which we depend for our news. Continue reading “BUT WAIT…THERE’S MORE (BEING SUCKED AWAY)” →

Forensic detail on NZME but where are the guarantees?

Excoriating is the word that may best describe expat Canadian James Grenon’s 11-page critique of NZME. His forensic examination of the board he hopes to replace and the company’s performance is a sobering read.

You may not have seen the letter. At the time of writing, it was still sitting behind the New Zealand Herald’s Premium paywall. It is, however, available through the New Zealand Stock Exchange. You can access it here.

Mr Grenon is highly critical in a number of areas that he breaks down into sections in the letter. The headings include:

  • “The combined performance of the two core businesses has been mediocre, to sliding, for the past eight years, despite a temporary period of COVID gains”.
  • “There has been a consistent pattern of over promising and under delivering since COVID”.
  • “Public disclosure is weak, with a slant that I interpret as supporting the status quo”.

Mr Grenon’s letter includes an analysis of NZME’s share price in relation to the perceived value of its OneRoof real estate marketing arm, and the company’s dividend policy. He claims “the disclosure on these two critical elements is, in my opinion, lacking or even misleading”. He also criticises levels of management-level remuneration and high levels of staff turnover which he says “does not suggest a happy working environment”.

NZME’s board has yet to respond to the letter stating – in a note to the New Zealand Stock Exchange accompanying the release of Mr Grenon’s letter – that it will do so in its notice to shareholders before the annual general meeting on April 29.

Were that the sum total of his challenge to the present board, it might be characterised as simply a move to improve the group’s financial performance and its return to shareholders. Much of what he says will, in fact, resonate with ordinary shareholders worried about the group’s financial performance and direction. It may well attract even more votes at the April AGM than he currently commands.

However, there is an enormous caveat hanging over any support for Mr Grenon’s initiative. Continue reading “Forensic detail on NZME but where are the guarantees?” →

No printed Herald? Let’s hope the speculation is wrong

Amid a wave of speculation in The Australian about the future of New Zealand publisher and broadcaster NZME, one line sent a shiver down my spine. It suggested the owner of the New Zealand Herald could opt for “a digital-only publication model”. That would decimate its newsrooms.

Normally, speculation is just that: Something to take with a grain of salt until it comes to pass or not. However, the editor of The Australian’s Dataroom column, Bridget Carter, seems to have been particularly well plugged-in to the NZME boardroom battle precipitated by Canadian billionaire and New Zealand resident James Grenon.

Carter has been devoting more space than usual to what is happening, or about to happen, to media on this side of the Ditch and, although her suggestion of interest in NZME from toy manufacturer Nick Mobray did not pan out, she has been up with the play on other scores.

Hence, I am more inclined to put some weight on her predictions for the directions that a reconstituted NZME board might take. For example, I agree that there could be a pull-back on the plan to move more into news video streaming (by no means a guaranteed revenue source). She also flagged investing in talent to boost subscriptions and I can see the benefit of that.

However, I hope she is wrong about a potential move to a digital-only publication environment.

Yes, I freely concede that on my bookshelf is a coffee mug carrying the slogan I love the smell of newsprint in the morning (a souvenir from Washington’s Newseum). And, yes, it does sit beside another mug that is testament to my age – Grumpy Old Man. However, my reasoning goes beyond a sentimental attachment to the medium in which I spent a large proportion of my now-surprisingly-lengthy working life.

I believe a digital-only strategy at this point could well spell the end of the New Zealand Herald as an influential news source. The revenue fall would leave it unable to maintain the current newsrooms. So I only hope that incoming NZME directors are smart enough to leave a digital-only strategy in the ‘pending’ file.

NZME relies on its print publications for a significant proportion of its revenue and, although it is declining, it continues to far outstrip what is generated by its digital services. Continue reading “No printed Herald? Let’s hope the speculation is wrong” →

Canadian billionaire must explain his designs on NZME…now

New Zealand-based Canadian billionaire James Grenon owes the people of this country an immediate explanation of his intentions regarding media conglomerate NZME. This cannot wait until a shareholders’ meeting at the end of April.

Is his investment in the owner of the New Zealand Herald and NewstalkZB nothing more than a money-making venture to realise the value of its real estate marketing subsidiary? Has he no more interest than putting his share of the proceeds from spinning off OneRoof into a concealed safe in his $15 million Takapuna mansion?

Or does he intent to leverage his 9.6 per cent holding and the support of other investors to take over the board (if not the company) in order to dictate the editorial direction of the country’s largest newspaper and its number one commercial radio station?

Mr Grenon has said little beyond the barest of announcements that have been released by the New Zealand Stock Exchange. While he must exercise care to avoid triggering statutory takeover obligations, he cannot simply treat NZME as another of the private equity projects that have made him very wealthy. He is dealing with an entity whose influence and obligations extend far beyond the crude world of finance.

While I do not presume for one moment that he reads this column each week, let me suspend disbelief for a moment and speak directly to him.

Come clean and tell the people of New Zealand what you are doing and, more importantly, why. Continue reading “Canadian billionaire must explain his designs on NZME…now” →