Local media give out vouchers, in spite of losses

10:12 am on 23 April 2020

A Whakatāne radio station plans to give $750 vouchers to about 1000 local business next week to try to bring the town back to life and get them spending again.

Glenn Smith receiving the Sir Paul Holmes award for Radio Broadcaster of the Year on behalf of 1XX.

Glenn Smith receiving the Sir Paul Holmes award for Radio Broadcaster of the Year on behalf of 1XX in 2018. Photo: screenshot / NZ Radio Awards

Radio 1XX and the family-owned Whakatane Beacon are both working on ways to get through winter as they grapple with the impact of Covid-19 crisis and the Whakaari / White Island disaster.

1XX managing director Glenn Smith said business is going backwards for his company, which owns three radio stations and employs 20 people.

"Radio has always been very resilient in situations such as the GFC and when we had major strikes in Kawerau and there were hundreds of people on strike. We've always survived that quite well. This is completely different," he said.

Income for May is down 55 percent and advertisers keep cancelling, he said.

Just a few blocks away at the Whakatane Beacon, spending by the two big advertising sectors, real estate and cars sales has almost dried up.

"Real estate in particular is huge for us," said the Beacon's managing director, John Spring. "We put out a tabloid once a week of about 32 pages, so that's a big chunk of our revenue."

The real estate tabloid has dropped in size to one page a week.

Some businesses in Whakatāne are having a poor summer because tourists have stayed away during their busiest time of year.

Whakatāne. Photo: 123rf.com

"And the scary thing is, how is it going to recover? We just don't know, we're just guessing a bit. Hopefully they [the advertisers] will come back but no doubt they'll come back to a lesser extent. They're facing a recession as well."

The Tuesday edition of the three-day-a week Beacon has been cut and household deliveries stopped under the government's media rules which deemed it non-essential. The newspaper is now sold only at supermarkets and dairies, while the digital version is in front of a pay wall.

The Beacon Media Group owns the Ōpōtiki News, Waitomo News and Eastern Bay Life and prints other local newspapers, employing about 120 people. Spring, whose father Lester started the paper in 1939, says the community is still recovering from the Whakaari / White Island disaster.

"There was a downturn after that which we're still feeling a little bit but now - with the recession and, in particular, tourism - that's going to hit Whakatāne quite a bit," he said.

Smith of 1XX worries about how the town will cope in winter.

"The hard stuff hasn't actually happened yet. Around June/July are going to be really quite difficult from a cash flow point of view because once again, we don't know how long level 3 is going to go for. When I talk about June/July we're going to be in the depths of winter then and so we have a double whammy from the Covid and Whakaari," Smith said.

He's losing hope of a government rescue package that would help local media and small businesses with subsidised advertising but he's spending nearly $1 million himself on a revival plan for the township.

"I'm going to be giving a voucher to every local business for $750 to spend with us. This is an encouragement to get business up and going."

Smith said he gave out vouchers during the 2017 Edgecumbe floods and he doesn't know if it will work again but he's willing to give it a crack if it means he'll survive and celebrate 1XX's 50th birthday next year.

And Spring said he's confident advertisers will return to support a newspaper that's been part of the Eastern Bay of Plenty for more than 80 years.

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