Commercial broadcast television heading for a crisis

An entire democratic, economically advanced country may lose advertiser-supported commercial broadcasting, leaving a government-controlled broadcaster with an on-air television monopoly.  This would not be due to the state shutting down its private rival, but simply due to the same market forces that are squeezing commercial television with the spread of internet-based media.

Australia's news.com.au reports:

Is New Zealand about to lose its only commercial broadcaster to rival public outlet TVNZ?

The country's sole major network, TV3, is up for sale by owners Mediaworks, and likely buyers are hard to identify.

Australian networks — Seven, Nine and Ten — will be courted, but aren't likely to jump in.

And so it is that around 500 employees at one of New Zealand's biggest media companies are waiting to learn whether they'll have jobs beyond Christmas.

"It is possible they'll close down? Well I think it is possible," Peter Thompson, New Zealand media expert at the Victoria University of Wellington, told AAP.


TV3 logo (YouTube screen grab).

TV3 has to share a market of only 4.74 million people with government-owned TVNZ, which competes with it for advertisers.  But the proliferation of streaming services like Netflix along with cable options means that viewership is declining (as it is for U.S. commercial television stations and networks).  Evidently, the advertising revenues are insufficient to sustain a workforce of 500, an understandable level of staff for a company that has to cover an entire country almost a thousand miles long with several sizable cities.

Thompson said Mediaworks' television arm turns over around $130 million annually, losing around $10–15 million.

Nobody is predicting the imminent demise of CBS, NBC, and ABC, but they clearly are facing the same technological and economic forces that may close New Zealand's TV3.

There is something alarming about the prospect of a government monopoly on broadcast television.  Unless people are willing to pay a subscription fee, they will be reliant on their governments for the high-impact news that television provides.  

An entire democratic, economically advanced country may lose advertiser-supported commercial broadcasting, leaving a government-controlled broadcaster with an on-air television monopoly.  This would not be due to the state shutting down its private rival, but simply due to the same market forces that are squeezing commercial television with the spread of internet-based media.

Australia's news.com.au reports:

Is New Zealand about to lose its only commercial broadcaster to rival public outlet TVNZ?

The country's sole major network, TV3, is up for sale by owners Mediaworks, and likely buyers are hard to identify.

Australian networks — Seven, Nine and Ten — will be courted, but aren't likely to jump in.

And so it is that around 500 employees at one of New Zealand's biggest media companies are waiting to learn whether they'll have jobs beyond Christmas.

"It is possible they'll close down? Well I think it is possible," Peter Thompson, New Zealand media expert at the Victoria University of Wellington, told AAP.


TV3 logo (YouTube screen grab).

TV3 has to share a market of only 4.74 million people with government-owned TVNZ, which competes with it for advertisers.  But the proliferation of streaming services like Netflix along with cable options means that viewership is declining (as it is for U.S. commercial television stations and networks).  Evidently, the advertising revenues are insufficient to sustain a workforce of 500, an understandable level of staff for a company that has to cover an entire country almost a thousand miles long with several sizable cities.

Thompson said Mediaworks' television arm turns over around $130 million annually, losing around $10–15 million.

Nobody is predicting the imminent demise of CBS, NBC, and ABC, but they clearly are facing the same technological and economic forces that may close New Zealand's TV3.

There is something alarming about the prospect of a government monopoly on broadcast television.  Unless people are willing to pay a subscription fee, they will be reliant on their governments for the high-impact news that television provides.