Broadcasting Minister Kris Faafoi has announced the Government is looking into creating a super-sized public broadcaster by possibly merging RNZ with TVNZ.
On Friday, Faafoi admitted the future of media in New Zealand is uncertain and said work has begun to ensure New Zealanders have a "strong independent public media service for decades to come".
"It's well known that New Zealand's media sector, both public and private, is facing unprecedented challenges with competition from the likes of Google and Facebook, declining revenue shares, and changes in when and how audiences access their information and entertainment.
"That presents risks for the future viability of New Zealand's public broadcasting operators, RNZ and TVNZ, and the Government needs to address those risks," Faafoi said.
The announcement comes after Cabinet agreed to do a business case in January. It will look at the practicality of disestablishing RNZ and TVNZ and creating a new combined entity.
Faafoi said a final decision about the future of RNZ and TVNZ will be made once it is finished.
"It is about establishing the best way of providing New Zealanders with a range of trusted news, information, and entertainment that reflects New Zealand – its diversity, history, and aspirations.
"At the same time, we need to ensure any new public entity has the flexibility and the strength to meet future change and challenges."
Faafoi said a new super-sized broadcaster would be better prepared to deal with the changing media landscape.
"Both TVNZ and RNZ currently will struggle to be able to adapt to some of the challenges media have and the adaption of a new entity would give scale and the ability to weather some of those challenges."
The Broadcasting Minister said the business case is also looking into whether TVNZ would become ad-free like RNZ.
He said it will look into what possible cost that might have for the taxpayers.
Faafoi said the new entity would also have impacts for the commercial market, and could possibly bring more stability to the media.
"There has been a combination of the environment changing and a lack of action which has called for something to be done, not just for public broadcasting but I think those in the commerical sector are looking for certainty over how New Zealand's media landscape will look in the future as well."
The minister wouldn't comment on whether fewer people would be employed in the new entity, saying it would be "preempting the business case".
Faafoi said the decision to consider creating a new entity wasn't taken lightly.
"We went through a range of options but if we look at the challenges the sector will have and the demands of the audiences they will have in the future, in terms of how they want to watch, listen and read stuff - that will change.
"How that will change we don't know but if we don't have an entity that is fit for purpose... then the media landscape as a whole will be lesser for it."
NZ On Air will continue to fund local content for both commercial and non-commercial media outlets.
PwC will conduct the case which is expected to be presented to Faafoi around the middle of this year.
NZ First broadcasting spokesperson Jenny Marcroft welcomed the review, calling it a "practical step".
"A strong media environment is critical for a healthy democracy. New Zealand First is a strong supporter of a diverse, independent media," Marcroft said.
"It is a New Zealand First policy and position to support and strengthen public sector media and the need to protect and future-proof TVNZ and RNZ. For this reason, we support the decision."
