Coleman Jonathan: Broadcasting Amendment Bill — In Committee 
Coleman Jonathan: Broadcasting Amendment Bill — In Committee 
[Volume:645;Page:14712] 
Dr JONATHAN COLEMAN (National—Northcote) 
: 
 I think previous speakers have brought up a number of points that bear revisiting. When we look at what this change will mean to funding arrangements we see that it really reflects the broadcasting environment that we are moving into. We talked previously about the fragmentation of audiences across platforms. The fact that Te Mangai Paho and New Zealand On Air will be able after this bill passes to fund content for those different platforms really sends a message to the traditional broadcasters and that is that the days of audiences going to just one broadcaster to get all their content are rapidly disappearing. The generation of people who are under 25—and let us face it none of them is in this Chamber—currently source their broadcasting content very much on an iPod model. They use software like LimeWire to download episodes of popular programmes like  
Desperate Housewives 
 from websites in America. They watch what they want when they want. I can tell members that the broadcasting environment is changing very very quickly. 
That is a major threat for traditional broadcasters like Television New Zealand (TVNZ) and TV3 because viewers will not be glued to just one channel. They will not just sit through whatever stuff is served up or sit through commercials. It is not a matter of their just channel surfing; they are going to assemble their own content very much along the iPod model for music. They will put all the stuff they want to access in one place they will watch it when they want to and they will not have to watch the advertisements. That is going to be a major challenge. 
Hon Trevor Mallard 
: People are doing it already. 
Dr JONATHAN COLEMAN 
: No that is what I said. 
Hon Trevor Mallard 
: You said that they will but they are now. 
Dr JONATHAN COLEMAN 
: Well increasingly more people will but people are doing it already. But I bet the Minister of Broadcasting is not doing it. 
Hon Trevor Mallard 
: Well actually I’ve got some very good people who help me with it. 
Dr JONATHAN COLEMAN 
: The Minister is getting help—OK. He admits he needs help in this domain. But I think the Minister will acknowledge that this is very much something that the younger generation of New Zealanders are doing. For people above the age of say 30 it may be a novel concept but that is the way it is going to go. 
What does it mean for TVNZ and TV3? It means it will be very hard for them to continue making the money that they have made out of advertising. Their audiences are dropping off. They are decreasing year by year. With that audience drop-off there is far less advertising revenue and of course the bottom line for those stations will not be good. It will be adversely affected. Last year we saw from TVNZ’s financial results that it had its first-ever loss. It was a loss of $4.5 million on revenue of $375 million. One has to ask what TVNZ is going to do to respond to that. That is the real challenge that faces the executives of TV channels today. They are trying a variety of different strategies but they do not know whether any of them will work. Last year TVNZ launched TVNZ ondemand which is a web-based model whereby people pay to download content but TVNZ does not know whether it will work. It does not really know whether it will produce enough revenue to turn things round. All broadcasters are facing these challenges and it will be interesting to see what the revenue models for broadcasting in the future are actually about. 
My colleague Georgina te Heuheu also mentioned that this bill will allow for the funding of Maori content and I think that is highly appropriate. Maori content was not being produced 20 years ago when the Broadcasting Act was originally passed. This bill brings the legislation into line with the cultural needs of New Zealanders and I think everyone would support that happening. 
I mentioned earlier the review of digital broadcasting. I think it will be pretty interesting. There is a lot of pretty wordy documents there. I do not think many members of the public will read through them. They will mainly be of interest to broadcasting academics politicians of course and a few journalists. They lay out a series of options for regulation. It is my belief that the Government does not want this regulation issue to rear its head before the election. It knows that the public response could be pretty mixed. 
But the Government has a problem: it has put $104 million into FreeView and basically it has to make it financially viable. There are two options. At some point the Government will have to turn off the analog TV signal and everyone will have to be able to access digital television. But the Government will be faced politically with a difficult situation. There will always be a group of people who are late adapters or who do not have the financial wherewithal to take up digital television. I think that that is one of the challenges for the Minister. I hope he will take a call to tell us what the plan is. 
Hon Trevor Mallard 
: It’s hardly part of this. 
Dr JONATHAN COLEMAN 
: The Minister has said that in 2012— 
Hon Trevor Mallard 
: It’s a very good discussion at the second reading. 
Dr JONATHAN COLEMAN 
: The Minister can take a call. He has plenty to say now. We would love the Minister to take a call. 
Hon Member 
: It’s not in this bill. 
Dr JONATHAN COLEMAN 
: Well broadcasting encompasses this issue which is what people want to hear about. The relevance to this bill is that we are moving into the digital environment and this bill is all about— 
Hon Mark Burton 
: Yes. 
Dr JONATHAN COLEMAN 
: Mark Burton says that is true so there we go. It must be true if Mark Burton the previous Minister of Justice says it is true.This bill is all about broadening out the financing arrangements to reflect technological changes. The digital review of broadcasting is all about the Government’s drift-net for ideas because it is out of ideas. Frankly it is completely exhausted after a shocking 9 years. It needs new ideas for broadcasting. It has thrown this bill out for public consultation and it is hoping the public will throw up a few ideas so that it can justify the sort of regulation it needs to bring in if FreeView is to be a success. When this Government goes in the election later this year I think it will be a great relief to a lot of these people because they will not have to deliver on a lot of this Government’s lofty ideals and plans for broadcasting. FreeView will become an albatross to sling around someone else’s neck because this Government will really struggle to deliver on it and make it viable. 
With FreeView the Government has set up digital television channels that are part of TVNZ. The people who watch those channels which $104 million of taxpayers’ money has been spent on have to come from somewhere. Where will they come from? They will come across from Television One and TV2. There is no advertising on those digital channels so the problem is that if those channels are a success they will take audiences away from the channels on which TVNZ can show advertising and its revenues will go down. If that does not happen then the digital channels by definition will fail. So the Minister is really stuck between a rock and a hard place. He is faced in this bill—which we all support—with some real challenges because this bill will speed up the fragmentation of audiences. It will take them away from Government-favoured projects like FreeView and that will produce a real headache for the Minister. He will have to come up with some answers as to how FreeView can be viable and how TVNZ can continue to be viable. 
The last point I would make is that National members are very keen that any funding given to new platforms goes to programmes that are available free to air to New Zealanders. We think that if a programme has Government funding people should be able to access it on a free-to-air platform. Within that we would include FreeView because analog television will disappear. But we do not want Government funding to disappear to a Vodafone pay-per-view download on to a mobile phone or any pay-per-view sort of platform. It is really important that there is accountability around Government funding and that the public have access to it. We saw in the  
Independent 
 yesterday that TVNZ is thinking about getting into pay TV. Well we would say that pay TV— 
Hon Trevor Mallard 
: No it’s rubbish. 
Dr JONATHAN COLEMAN 
: Here we go; it is the Minister again. He ought to take a call. He will get a chance in a minute but I bet that he will not take it. I bet the Minister that he will not take a call. He will just interject on other speakers. 
Hon Trevor Mallard 
: How much? 
Dr JONATHAN COLEMAN 
: Well I ask the Minister how much we should make it. 
The question was put that the amendment set out on Supplementary Order Paper 178 in the name of the Hon Trevor Mallard to clause 6 be agreed to. 
Amendment agreed to. 
Part 1 as amended agreed to.