Proposed Merger NZME and Fairfax

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psychrn

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#195920 11-May-2016 23:53

I note there is a proposal for the Merger between NZME who own Stuff and Fairfax that own The NZ Herald.

Im surprised this has not had any other mention on these forums.

http://m.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11637176

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#1551235 11-May-2016 23:56

2 days after a merge occurs they will throw a paywall up. I sense opportunity for smaller media providers.

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#1551237 12-May-2016 00:07

Coming soon:

You won't believe which two big organisations will merge!

The 10 New Zealand publications that will have new owners next week!

5 amazing facts about the NZME Fairfax merger

Kim Kardashian talks about NZME/Fairfax

Bachelor contestant signed by NZME/Fairfax as serious relationship reporter

mattwnz

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#1551240 12-May-2016 00:27

Under normal circumstances, I couldn't see how the competition watchdog could let it occur, as NZers could be worse off in a a number of ways. But supposedly it is a dying industry, and they need to do it so they an lay off staff and cut costs and duplication, and supposedly we are now in a world media market. But can mainstream news really get much worse, especially their clickbait news websites? The top stories are about the bachelor, who it was disclosed yesterday, was also an actor.

lurker

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#1551241 12-May-2016 00:27

You mean: Our organisations have merged, you'll never guess what happened next!

lurker

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#1551242 12-May-2016 00:31

If I was running the comcom I'd let it pass out of pity, there's no hope for them anyway.

Only got themselves to blame I guess, you'd expect these guys to be curators of news so you don't have to go looking for it yourself but they've failed abysmally.

Clickbait might get you some wins but long term everyone is going elsewhere for news

Technofreak

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#1551244 12-May-2016 01:11

Upside, we'll only need to go to one place to get stupid headlines.

Downside, we won't have a choice of places to go to find stupid headlines.

Yep, paywall might be on it's way, though to some extent they've missed the bus. If either one of them (or both) had had a paywall with decent news content I think they would have got a good following. As it is now they've both been serving up c**p, who's going to want to pay and risk getting the same c**p.

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#1551255 12-May-2016 07:25

A good name for the new website........ STUFF UP

Here is a crazy notion, lets give peace a chance.

alasta

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#1551258 12-May-2016 07:29

I don't think this is a bad thing, because the quality of their product couldn't possibly get any worse. Yes, there will be job losses, put popular opinion within the industry is that the extent of job losses probably would have been worse over the long term with the two organisations standing alone.

At least this pretty much puts to bed rumours of Fairfax wanting to take over Mediaworks.

ockel

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#1551262 12-May-2016 07:39

mattwnz:

Under normal circumstances, I couldn't see how the competition watchdog could let it occur, as NZers could be worse off in a a number of ways. But supposedly it is a dying industry, and they need to do it so they an lay off staff and cut costs and duplication, and supposedly we are now in a world media market. But can mainstream news really get much worse, especially their clickbait news websites? The top stories are about the bachelor, who it was disclosed yesterday, was also an actor.

I'm of the opposite opinion. I cant see why the ComCom would decline the merger.

There is almost zero geographical overlap (in some areas community newspapers and metros overlap but its minimal and address different audiences). Their non-newspaper assets are in different areas (radio vs magazines). There is history of shared sales, shared copy and shared production assets.

If the ComCom can approve the Z-Caltex deal with significant overlap - and a clear increase in the Herman-Herfendial (sp) Index [this is a measure of market concentration] then there is almost no chance they cant approve this deal.

On the plus side it may mean that the merged entity can retain the decent journo's and improve the quality of the journalistic output.

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#1551687 12-May-2016 19:26

So we'll go from two corporate media editorial voices saying pretty much the same thing to one.

It will save time reading the self-serving propaganda of the world's media billionaires.

Or you could listen to RNZ and find out what's really going on.

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Linuxluver

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#1551688 12-May-2016 19:27

ockel:

mattwnz:

Under normal circumstances, I couldn't see how the competition watchdog could let it occur, as NZers could be worse off in a a number of ways. But supposedly it is a dying industry, and they need to do it so they an lay off staff and cut costs and duplication, and supposedly we are now in a world media market. But can mainstream news really get much worse, especially their clickbait news websites? The top stories are about the bachelor, who it was disclosed yesterday, was also an actor.

I'm of the opposite opinion. I cant see why the ComCom would decline the merger.

There is almost zero geographical overlap (in some areas community newspapers and metros overlap but its minimal and address different audiences). Their non-newspaper assets are in different areas (radio vs magazines). There is history of shared sales, shared copy and shared production assets.

If the ComCom can approve the Z-Caltex deal with significant overlap - and a clear increase in the Herman-Herfendial (sp) Index [this is a measure of market concentration] then there is almost no chance they cant approve this deal.

On the plus side it may mean that the merged entity can retain the decent journo's and improve the quality of the journalistic output.

But....both outlets overlap 100% on the Internet.

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DarthKermit

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#1551719 12-May-2016 19:38

alasta:

I don't think this is a bad thing, because the quality of their product couldn't possibly get any worse. Yes, there will be job losses, put popular opinion within the industry is that the extent of job losses probably would have been worse over the long term with the two organisations standing alone.

At least this pretty much puts to bed rumours of Fairfax wanting to take over Mediaworks.

Hey! Have a little more faith won't ya? I'm sure they'll try to increase the bullsh1t further.

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#1551840 12-May-2016 23:47

I'm very concerned.

How will we find out about cats up trees and which person's sex tape broke the internet now?

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#1665530 8-Nov-2016 09:14

Just received:

Commission proposes to decline NZME/Fairfax merger
The Commerce Commission has today published its draft determination on NZME and Fairfax’s application under the Commerce Act seeking authorisation to merge their media operations in New Zealand. The Commission’s preliminary view is that it should decline to authorise the merger.

The proposed merger would bring together New Zealand’s two largest newspaper networks and two largest news websites. The Commission has assessed the impact of the merger on competition in both advertising and reader markets for a number of media platforms as well as the overall impact on quality and plurality (diversity of voices).

The Commission’s preliminary view is that the merger would be likely to substantially lessen competition in a number of markets, including the markets for premium digital advertising, advertising in Sunday newspapers and advertising in community newspapers in 10 regions throughout New Zealand. It also considers the merged entity would be likely to increase subscription and retail prices for Sunday newspapers and introduce a paywall for at least one of its websites.

Chairman Dr Mark Berry said the merger would result in one media outlet controlling nearly 90% of New Zealand’s print media market. This would be the second highest level of print media ownership in the world, behind only China. The merged entity would also control New Zealand’s two largest news websites – nzherald.co.nz and stuff.co.nz – which together have a population reach more than four times larger than the next biggest domestic news website. Further, the merged entity would own one of New Zealand’s two largest commercial radio companies. All this would result in an unprecedented level of media concentration for a well-established liberal democracy.

“Our preliminary view is that competition would not be sufficiently robust to constrain a multi-media organisation, potentially with a single editorial voice, that would be the largest producer of national, regional and local news by some margin in New Zealand,” Dr Berry said.

“NZME and Fairfax each play a substantial role in influencing New Zealand’s news agenda. Competition between the parties drives content creation, increases the volume and variety of news available in New Zealand and assists with objectivity and accuracy in reporting. Our view is that the removal of this competitive tension would likely lead to a reduction in the quality and quantity of New Zealand news content both online and in print, with potential flow-on effects in television and radio.

“We recognise that the merger would achieve net financial benefits through organisational efficiencies. However, while we cannot quantify the detriments we see with respect to quality and plurality of the media, we consider that detriments resulting from increased concentration of media ownership in New Zealand would outweigh the quantified benefit we have calculated. In particular, the potential loss of plurality has weighed heavily in our draft decision. On this basis, we propose to decline the application.”

As this remains a live process, the Commission cannot comment further at this time.

A public version of the draft determination is available on the Commission’s website.

The Commission is seeking submissions on its draft determination by the close of business on Tuesday 22 November 2016.

Please send submissions to registrar@comcom.govt.nz with the reference Fairfax/NZME in the subject line of your email or to PO Box 2351, Wellington 6140. Submissions will be posted on the Commission's website. If your submission contains confidential information please also provide us with a public version.

Under the Commerce Act, the Commission may determine to hold a conference prior to making a final determination. We have currently scheduled a conference in respect of this matter for three days in Wellington: Tuesday 6 - Thursday 8 December 2016. Further information and venue details will be posted on our website shortly.

Background
Authorisation applications follow a two-step process under the Commerce Act. The Commission must first assess whether the merger would be likely to substantially lessen competition in a market.

We assess whether a merger is likely to substantially lessen competition in a market by comparing the likely state of competition if the merger proceeds, with the likely state of competition if it does not. If we are satisfied that the merger is not likely to substantially lessen competition, then we would clear the merger at the first step.

If we cannot give clearance due to competition concerns, the second step is to determine whether the merger should be authorised applying the public benefit test. The public benefit test involves a balancing of the public benefits and detriments that would, or would be likely to, result from the merger. We must authorise a merger if we are satisfied that the merger will result in such a benefit to the public that it should be permitted.

The Commission can only accept structural undertakings, such as the divestment of assets, from parties to resolve competition concerns in a market. We cannot accept behavioural undertakings – where the parties agree they would or would not make specific business decisions post-merger in order to gain approval.

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#1665569 8-Nov-2016 10:12

Bizarre that they telegraph their intentions just to see if anyone likes them.

Talk about lacking the courage of your convictions...!

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