One of the country's biggest commercial media company’s newsrooms - Newshub - is set to close at the end of June, putting dozens of journalists out of roles.
Warner Bros. Discovery has laid out plans to close its Newshub news division from the end of June, and will apparently look to “co-fund” local news with a partner.
“Look this is awful,” Warner Bros. Discovery NZ boss Glen Kyne told staff at an all-staff meeting this morning.
The company would look to co-fund local news but Three was now the “core” of the future business, staff were told.
In a statement at 11.18am, Warner Bros. Discovery said it had commenced consultation on a “proposed remodelling and restructure of its ANZ free-to-air business in New Zealand”
“The proposal includes the closure of all Newshub’s multiplatform news operations and output, and new local programming would only be in collaboration with local funding bodies and other partners.”
It is not yet clear what happens to the likes of the 6pm news, hosted by Samantha Hayes and Mike McRoberts, or news shows, such as Ryan Bridge’s planned new 7pm show.
According to Newshub’s website, the company employs at least 57 journalists.
One staff member said they were gutted. “These are staff who care very much about news and this is devastating.”
James Gibbons, President, Asia Pacific, Warner Bros. Discovery said the proposal was not arrived at easily.
”We are acutely aware of our position in the local media landscape and what this means for our people, and for the country as a whole.
”There was no single trigger that caused this, rather it was a combination of negative events in New Zealand and globally. The impacts of the economic downturn have been severe, and the bounce back has not materialised as expected.
”Advertising revenue in New Zealand has disappeared far more quickly than our ability to manage this reduction, and to drive the business to profitability.
”Everyone can see that the media sector, here in New Zealand, and around the world is facing some very tough circumstances. While Warner Bros. Discovery is a large global media company, each business is managed on its ability to sustain itself within the market it operates in. Subsidising losses for ongoing years indefinitely is not sustainable.”
Staff were called to the meeting this morning, amid speculation of the major announcement impacting the company’s future.
Earlier
Warner. Bros Discovery called the meeting for 11am. Staff in Auckland were asked to attend in person; those around the rest of the country, or who can’t otherwise make it, were to dial in on Zoom.
“Staff are super anxious,” said one source.
They said the meeting had been scheduled for some time - but the language for the invitation changed this morning, with the suggestion it was an important announcement and roles might be impacted.
Another source thought it might be standard ‘town hall’ catch-up.
Warner Bros. Discovery spokespeople have not returned messages this morning.
There are suggestions the company - which posted a $35 million post-tax loss in 2022 - might make an announcement on the future of terrestrial television.
At the time of the 2022 financial results being signed off, on May 31 last year, the company gave a minimum 12-month commitment to continue to finance the New Zealand operation.
Warner Bros. Discovery pays huge fees - millions of dollars - to broadcast terrestrially and has sought relief from the government.
It has also made no secret of the fact of its focus on becoming a digital-only streaming operation in the future.
There is also huge pressure in the Newshub news division with several shows - including Ryan Bridge’s new 7pm show - delayed by months as a result of a hiring freeze.
Over the past 12 months, the company has seen a dramatic change to its news and current affairs menu.
In August 2023, it announced the axing of its AM Early show and its 11.30am news bulletin on Newshub. Earlier in 2023, it quietly dropped the 8pm news bulletin on its Eden channel.
But the biggest bombshell came in October, with news that its 7pm show, The Project, would end its six-year run on December 1. In its place, and earmarked for early 2024, a new show hosted by Bridge, who has been lifted out from presenting duties of the AM show.
But that new show, Bridge, has been beset by delays, mainly caused by a hiring freeze at Warner Bros. Discovery. It was expected to be on air by now, but inside sources then pinpointed April and - as late as last week - June.
In the background, its head of news, Sarah Bristow, has left the business - and has been replaced by an interim head, Richard Sutherland.
US giant Discovery bought TV arm of MediaWorks - including Three and its news brand Newshub - in December 2020.
MediaWorks, which has its own financial struggles, continues to operate as a radio and outdoor business, owned by US company Oaktree Capital Management and outdoor advertising company QMS.
In April 2022, Discovery and Warner Bros came together in a multi-billion-dollar merger, to form Warner Bros. Discovery.
In 2022, Warner Bros. Discovery’s New Zealand operation posted a $35 million post-tax loss (following a $21m loss the previous year), raising questions about its American owners’ commitment to a loss-making operation at the bottom of the world.
In notes to its 2022 financial accounts - signed on May 31, 2023 - WBD directors said they were consolidating New Zealand operations and implementing a global strategy to deliver synergies to improve operating earnings.
While this strategy was under way, the directors committed to providing sufficient financial assistance to continue operations for a minimum 12 months from the date of signing the financial statements.
In an interview in August, Warner Bros. Discovery local boss Glen Kyne painted a picture of a business fully focused on a digital future - and one also seeking financial relief from the Government, along with other traditional broadcasters.
“What is the future of free-to-air [terrestrial] television? What does that look like into the future? That’s taking a lot of my time, a huge amount of my time, right now,” Kyne said at the time.
“The trends aren’t changing; we see just this continual decline in what we call traditional linear audiences.”
He said that was balanced by huge growth, digitally. “Everything we see about the streaming world gives us a lot of buoyancy and optimism for the future. That’s where our energy and attention is going.”
According to media reports, Kyne met the then Broadcasting Minister Willie Jackson last year to seek financial relief. Those conversations have certainly continued under the new National-led coalition.
In an internal staff email, released to The New Zealand Herald, Kyne said at the time: “To be clear, our request to the minister was not for money as was initially and incorrectly reported. We are however, seeking change for the benefit of the entire New Zealand sector via relief from the significant Kordia fees that all broadcast media organisations pay to a state-owned company for broadcast infrastructure.
“We have been very clear regarding our strategic transition to a digitally-led operating model in a timely, efficient and effective way. In this future model, the broadcast infrastructure would not be required. The proposed Kordia relief benefits multiple players, including state-owned TVNZ, and will enable us to heavily invest into our digital transition.”
- By Shayne Currie
