23 Apr 2024

TVNZ still has money for IT upgrade, despite news cutbacks

6:45 am on 23 April 2024
TVNZ building in Auckland Central

Photo: RNZ/Calvin Samuel

TVNZ says it must press ahead with big spending on new technology, while also cutting news jobs and programmes

It has signed Irish company Accenture to help build a new digital platform over five years, for the likes of its streaming service.

The Crown entity says its strategy was to triple digital advertising revenue by 2028.

"Over the next few years, we will significantly increase digital advertising opportunities for New Zealand businesses, create new revenue streams outside of advertising, and give our advertisers more data-led options on our platforms."

But other advertising revenue keeps shrinking.

"With the significant declines we're seeing in the TV advertising market, we must reduce our operating costs to match our revenue," a spokesperson told RNZ in a statement.

Interim chief executive Brent McAnulty said in October that "developing a world-class digital offering is one of the most important investments we can make to safeguard quality local content in Aotearoa for years to come".

But that digital upgrade has come too late to safeguard current affairs show Sunday, most news bulletins and dozens of jobs that the broadcaster confirmed last week would be cut.

A spokesperson said the company must invest in new IT to keep up to date.

"The IP [internet protocol] programme is fundamental to TVNZ's transformation and will safeguard the future sustainability of our organisation."

According to government briefings, TVNZ has announced a $100m investment in its online platform TVNZ+, "while continuing to maintain legacy networks and infrastructure".

TVNZ has refused to reveal the overall costs, on the grounds of commercial sensitivities.

"But we have been clear that it will require significant investment from our cash reserves and earnings to create a sustainable future business," a spokesperson said.

Accenture began work on the project to set up a Master Systems Integrator last week.

A TVNZ executive told Businessdesk: "At the moment, the technology holds us back from everything we'd like to do" and the new platform would "enable us to do a whole lot more".

The IT spend did not reduce its resources available to spend on news production: "We continue to invest $40m annually into news and current affairs."

Investigative journalism took many shapes and forms and would continue, possibly added to by an investigative consumer and current affairs team on the digital side, the spokesperson said.

"We have a five-year plan to fund this investment through a combination of cash reserves and operating profit.

"That plan is only achievable if we're able to ensure the business remains operationally solvent while we make the changes."

Online streaming helped TVNZ increase digital revenue by 16 percent in the half-year to December, but free-to-air TV ad revenue continues to drop.

The company set up a transformation team last year to push through the IT changes.

It would not say if this team had undergone any cost cutting, saying it was a "confidential employment process".

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