Regulatory Overreach

A First Look at the Media Reform Proposals - Regulation

During the second week of February the Ministry of Culture and Heritage released a Discussion Document which contained proposals for Media Reform

The document covers five areas:

1. Ensuring Accessibility of Local Media Platforms:

   • Require TV manufacturers to ensure local media services are prominent and visible on devices such as smart TVs. ​

2. Increasing Investment into and Discoverability of Local Content:

   • Require streaming platforms and TV broadcasters to invest in local content and implement measures to ensure it is more discoverable on their platforms. ​

3. Increasing Captioning and Audio Description (CAD):

   • Require more captioning and audio description on content that is broadcast or streamed to ensure access for disabled New Zealanders. ​

4. Modernising Professional Media Regulation:

   • Revise the broadcasting standards regime to include platform-neutral and system-level regulation of professional media. ​

5. Streamlining Crown Content Funders:

   • Consolidate NZ On Air and the Film Commission into a single entity to support efficient administration of government funding for local content and industry development. ​

In this article I want to focus on the issue of “Professional Media Regulation”.

The materials that I have considered are the discussion paper itself together with an Interim Regulatory Impact Statement: Modernising professional media regulation. This second document was noted on the Ministry of Culture and Heritage’s website but is not mentioned in the Discussion Document.

It is the Discussion Document that contains the issues upon which feedback is sought but the Interim Regulatory Impact Statement (IRIS) is perhaps the most revealing, because it contains background, context and at times motivations for these proposals.

What is suggested is that the broadcasting regulatory regime set up under the Broadcasting Act is no longer fit for purpose. It only covers broadcasting. Streaming and Online Services are not covered by the Act.

Audiences are moving from traditional broadcasting to alternative platforms to obtain information. And these platforms are not regulated.

In addition news media (news papers and other news media excluding broadcast) are voluntarily regulated by the News Media Council. Although the Council has jurisdiction over online platforms, those platforms have to join up. Unlike broadcasting, regulation does not automatically apply.

So that is a sketch of what could be called mainstream media (MSM) regulation.

It is argued in the Discussion Paper and the IRIS that this structure is no longer fit for purpose.

The proposal is to expand the scope and applicability of the regulatory model. Other organisations would be captured. They would be subject to whatever controls and complaints regime would be established.

The proposal is that the regulatory structure would apply to professional media.

How is that defined? To put it simply, it isn’t. The IRIS does not provide a precise definition of "professional media" but outlines the intent and scope for further work to determine its parameters. The intent at this stage is to exclude social media and other online platforms hosting user-generated and non-curated content. ​

The document suggests that "professional media" would encompass:

• New Zealand Organisations: Media organisations that commission, produce, or directly pay for media content and distribute it as their primary business. ​

• Exclusion of User-Generated Content: Platforms that host or provide access to others' content, with no editorial or substantive curation functions, such as search engines and social media, would not be included. ​

• Global Streaming Platforms: Under one of the options considered, it would also include overseas-based media companies with a business presence in New Zealand, such as global streaming platforms like Netflix. ​

The document indicates that further work and consultation will be required to define the exact scope of "professional media."

The professional media issue is dealt with in the Discussion Document and brings a little more clarity – just a little – not a lot.

"Professional media", according to the Discussion Document, is intended to capture organizations that commission, produce, or directly pay for media content and distribute it as their primary business.

Specifically, it includes:

• New Zealand broadcasters and streaming platforms (see discussion below)

• Global streaming platforms

• Online text-based media

• Newspapers and magazines

It does not include:

• Online platforms that primarily host user-generated content or provide access to others' content, such as social media (like Facebook and TikTok) and search engines (like Google).

The exact definition of "professional media" will require further work, says the Discussion Document, echoing the IRIS, particularly as media forms and services continue to emerge and converge.

Great. So we have a proposal for media reforms and the modernization of professional media regulation but we don’t know precisely to whom it will apply. It won’t apply to search engines or social media but could include streaming platforms like Netflix.

The scope of “professional media” has yet to be determined. Great start Ministry of Culture and Heritage. Let’s figure out a regulatory model and then work out to whom it should apply. The law is meant to be clear. This vital definition is not.

Just as an aside there is a bit of an anomaly in the current regulatory landscape that may account for the reference to NZ Broadcasters and streaming platforms.

Under the present regulatory system, TVNZ, Sky and TV Three operate traditional broadcast services which are subject to the BSA as well as streaming services which are not.

Thus content which appears on the streaming service that is not broadcast via the traditional service is theoretically not subject to the BSA complaints process.

This anomaly provides some assistance in defining “professional media” that is not as wide in scope as that envisaged in some of the options put forward.

Professional media should cover a traditional broadcaster which, in addition to broadcasting within the provisions of the Broadcasting Act also provides streamed or on-demand content.

That would not capture content providers who only stream or offer on-demand content thus maintaining the integrity of the original purview of the Broadcasting Act.

To do otherwise would be to unreasonably extend State interference in the dissemination of information.

So where did all this come from. It is here that the IRIS provides some useful information.

Previous government work – the Safer Online Services and Media Platforms - had a much wider scope (including publicly available user-generated content) and sought to create a more unified regime of content regulation framed around minimising harm from content to individuals and particularly children.

That work led by the Department of Internal Affairs working alongside the Ministry of Culture and Heritage, was discontinued. This decision is referred to at page 3 of the IRIS

“A key constraint on options centres on Ministerial decisions to conclude previous work, led by the Department of Internal Affairs, on a consolidated framework for content regulation in New Zealand. This decision has informed the scope of this interim RIS, which excludes regulation of social media and changes to the classification regime, both of which sit within the Internal Affairs portfolio. The preferred options would be compatible with future changes to accommodate regulation of social media and/or to standardise or bring together labelling and content classification functions. In the meantime though, this scope means wider fragmentation and gaps across the content regulation system will remain.” (The emphasis is mine)

The DIA programme is referred to again at page 11 of the IRIS

“From June 2021 to May 2024 DIA conducted a review of content regulation, with support from the Ministry. With a focus on consumer safety and reducing harm to individuals and children, the work aimed to design a unified regulatory system that could cover all major media platforms (including social media), adapt to emerging and future technologies and platforms, and was easy to navigate for users, content creators, and regulators.

In mid-2023 DIA consulted on a proposal focusing on safety objectives. This included industry regulation covering all media platforms (including social media), collaboratively developed codes of practice for media sectors, and a new regulator to oversee the framework at arm’s length from government. The review was closed without implementing the proposed approach.

The Ministry notes that the aims and scope of options analysed in this RIS (discussed further below) are significantly narrower than the DIA-led review. Rather than minimising harm and ensuring a unified approach across the full range of media New Zealanders engage with, this work is focused on modernised regulation of a particular subsector (professional media, the parameters of which are discussed below), which has been seeking updates to the broadcasting standards system for some time.”

So the scope of the Media Reform is not as wide as Safer Online Services and involves regulation of what is referred to as a subsector – but a much wider subsector than just MSM or broadcasting – and clearly is an inheritor to the Safer Online Services proposals. Clearly the bureaucracy is loath to relinquish the ideas behind a policy that the Government deep-sixed in 2024.

This proposal has a different focus but just as wide a reach and likely to encompass broadcasters, bloggers, Substack writers, internet radio facilities like the Platform or Reality Check Radio along with others.

And the objective is content control and standardisation.

So what is proposed.

The proposed functions of the regulator in the modernized broadcasting standards regime include:

1. Guiding and Developing Media Standards:

   • Collaborating with the industry to develop and maintain media standards that apply to content across all professional media in New Zealand, regardless of the delivery platform. ​ Protecting and promoting media independence and freedom of expression would remain a core focus. ​

2. Educating, Researching, and Providing Advisory Opinions:

   • Supporting the sector and audiences by providing education, conducting research, and offering advisory opinions related to media standards. ​

3. Monitoring the Regime’s Effectiveness:

   • Overseeing and assessing the effectiveness of the regulatory regime, including the processes for handling complaints. ​

4. Administering Electoral Broadcasting Rules:

   • Managing the rules related to electoral broadcasting as outlined in Part 6 of the Broadcasting Act. ​

5. Providing a ‘Backstop’ for Complaints Resolution:

   • Acting as a secondary option for complaints resolution if audiences are not satisfied with the response from the relevant media organization or industry self-regulatory bodies. ​ The regulator would handle unresolved complaints and provide a right to appeal industry bodies’ complaints decisions, with the existing right to appeal to the High Court being carried over to the new regime. ​

These functions aim to ensure “positive system-level outcomes” (their words not mine), uphold industry and community standards, and support a fair and consistent regulatory environment for all professional media in New Zealand.

The need for an expanded regulatory system​ is assumed. Comfortable phrases such as “upholding industry and community standards” are not defined and are meaningless. Furthermore they imply a collective mindset that underpins these proposals.

But what is really concerning about all this is the extension of regulatory coverage and it will be of much wider scope than the current model.

According to the IRIS there is “broad support” for a changed regulatory environment from stakeholders.

1. Industry and Regulator Feedback:

   • There is broad agreement among industry bodies and regulators that modernizing media regulation is necessary and overdue. ​

   • Feedback highlights that the broadcaster-centric regulatory approach of the Broadcasting Standards Authority (BSA) risks being ineffective as audience preferences and media technology continue to change. ​

2. Initial High-Level Discussions:

   • Discussions with the BSA, Media Council, and government agencies indicate general support for the direction of the preferred options in the Regulatory Impact Statement (RIS), though with some reservations about the scope constraints and a view that the detailed design of arrangements will be crucial. ​

3. Submissions on Previous Work:

   • Submissions from media organizations on previous proposals for reform agreed that the current system can be confusing for users and needs updating. ​

   • Media and content regulators supported simplifying regulation, using a co-regulatory code-based approach, and ensuring more oversight of platforms that are currently unregulated to minimize harm from content to individuals and particularly children. ​

4. Ongoing Engagement with Media Organizations:

   • Ongoing engagement with New Zealand media organizations indicates strong support for reform. ​ These organizations, particularly broadcasters, consider that the Broadcasting Act is out of date and that the regulatory approach needs reform to reflect the modern media environment and the existence of competent self-regulation. ​

Overall, there is support from industry bodies, regulators, and media organizations for modernizing the regulatory environment to ensure it is fit for purpose in the current and future media landscape.

Is this surprising? Not really. What we have is a MSM ecosystem that is facing enormous competition from online and streaming services. Some might say that it is facing an existential crisis.

But rather than considering how to improve their lot, rather than improving the quality of the content that is offered (TV shows made in NZ are pretty dire compared with what is available on Netflix or Prime), rather than changing the business model, they adopt the New Zealand approach to dealing with competition – regulate and bring the competition down to our level.

Oh – and don’t forget the big platforms should be subsidising us as well with the Fair Digital News Bargaining Bill.

And that other bit of the Media Reform (not detailed in this article) – let’s compel overseas streamers to have a minimum percentage of local content.

And require Smart TV manufacturers to give greater prominence to NZ based streaming services whose content will be bland and dull because they will have been subject to the proposed media regulatory reform.

I suggested a definition for “professional media” in this article. It should extend no further than the current locally based news media services.

In that way we the consumers will continue to enjoy the smorgasbord of offerings on unregulated on-demand and streaming services.