Fairfax NZ boss quits days ahead of NZME merger ruling

Article – BusinessDesk

March 9 (BusinessDesk) – Fairfax New Zealand managing director Simon Tong has resigned just days before a Commerce Commission ruling on the proposed merger with NZME, a step the media companies say they need to survive a changing industry.Thursday 09 March 2017 11:24 AM

Fairfax NZ boss Simon Tong quits days ahead of NZME merger ruling, heads to ASB

By Sophie Boot

March 9 (BusinessDesk) – Fairfax New Zealand managing director Simon Tong has resigned just days before a Commerce Commission ruling on the proposed merger with NZME, a step the media companies say they need to survive a changing industry.

Tong, who joined Fairfax in September 2013, will leave next Friday and begin as ASB Bank’s executive general manager technology, innovation and payments on March 27, making him part of ASB’s executive leadership team. Andrew Boyle will be acting Fairfax NZ managing director, the media company reported. Boyle last stepped up as acting chief in 2013 when Allen Williams returned to Fairfax in Australia.

ASB chief executive Barbara Chapman said Tong brings “a unique combination of skills, industry experience and knowledge to the role” and he has a “proven track record of managing large and dynamic organisations.” Prior to Fairfax, Tong was chief executive of Paymark for seven years.

Tong said he was “thrilled to be joining the ASB team during such an exciting period of change for the financial services industry” and his background “provides me with a unique opportunity to contribute to the success of ASB.”

His exit comes as the Commerce Commission’s decision on the media merger looms large on Wednesday. It was originally due last August, but was delayed due to the complexity of the deal. The regulator released a draft determination in November rejecting the merger, saying it would “result in an unprecedented level of media concentration for a well-established liberal democracy” with the potential loss of multiple media voices a major part of the decision.

The regulator held a public conference in December. In NZME and Fairfax’s public response to questions raised during the conference, the companies argued that reducing duplication in news coverage would be “efficiency enhancing and will not materially detract from the volume or quality of news coverage”, and that TVNZ, Newshub and RNZ are and will remain a serious competitive constraint if the merger is allowed.

In a letter from the companies’ lawyers to the Commerce Commission, the publishers said understanding the competitive media market required the recognition “that mobile and video is where the market for news and entertainment is growing rapidly” and free-to-air operators have considerable advantages in producing this. The regulator did so in its recent rejection of the Sky Network Television/Vodafone New Zealand merger, the letter says.

“Simply put, there is no exclusivity in the creation of news content, it is freely available,” the lawyers said. “There are no barriers to entry or expansion in the creation of news content, journalists can be hired. There are no barriers to switching for consumers, especially in the digital space where consumers can switch between sources of information with a click or a Google search.”

A Fairfax spokeswoman wasn’t immediately available to comment.

(BusinessDesk)

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