However, new legislation in New Zealand could help news outlets reach a fair deal with tech giants Google and Meta, which runs Facebook and Instagram.
Presently, when people searched for news or information on Google or Facebook, and read summaries of locally published stories, tech giants earned the advertising revenue, Mr McKenzie said.
That meant stories published by the Otago Daily Times or any of Allied Press’s community newspapers would not earn the news organisation any revenue if people did not visit the website, he said.
Representatives of the News Publishers Association had been trying to negotiate with the tech giants since April this year.
Digital advertising made up over a billion dollars of revenue in New Zealand’s media industry, but the overwhelming majority of that was taken by big tech companies, Mr McKenzie said.
The result was over $100 million in advertising revenue being taken out of New Zealand each month despite the content being created by local reporters.
In Australia and Canada the companies had to pay media outlets for their news, but that was not the case here.
"Why would New Zealand be any different?"
On Monday, it was announced new legislation would be introduced that would force large digital companies to strike fair deals with New Zealand publishers.
Broadcasting minister Willie Jackson said the new legislation would be modelled off those Australian and Canadian models.
"It’s not fair that the big digital platforms like Google and Meta get to host and share local news for free.
"It costs to produce the news and it’s only fair they pay."
The legislation would act as an incentive for the digital platforms to make payment deals with news outlets.
"If there’s not an agreement then a mandatory mediation and arbitration process will be put in place, to make sure a fair deal is rolled out," Mr Jackson said.
