ComCom says no to Fairfax/NZME merger – A short sighted decision?

The NZCC's rejection of the Fairfax/NZME merger overlooks global digital competition from Facebook and Google.

Sarah Kasher · Venture Insights1 May 2017Period: May 20178 min read

Last updated 10 June 2026

90%→

Projected print media market share of the merged entity

NZ$55m→

Cash price NZME agreed to pay for 100% of Fairfax NZ

Locked

+1more stats

Companies covered:NZMEFairfax MediaGoogleFacebookSkyTVVodafone

Abstract

This report analyzes the New Zealand Commerce Commission's (NZCC) decision to reject the proposed merger between NZME and Fairfax Media. Despite the potential for $40 million to $200 million in cost savings over five years, the regulator cited concerns over a 90% print market share and a loss of media plurality. Venture Insights argues the decision is short-sighted, failing to account for the dominant role of global digital platforms like Google and Facebook in the advertising market.

Key Takeaways

The NZCC rejected the NZME-Fairfax merger on 3 May 2017, primarily due to concerns over a 90% print market share monopoly.
The merger was expected to generate between $40 million and $200 million in cost savings over five years to support digital transition.
NZME shares plummeted by 23% following the initial draft determination, reflecting market pessimism regarding the standalone outlook.

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Frequently Asked Questions

The NZCC cited the merged entity's 90% control of the print media market as a threat to news plurality and content quality. This focus ignored the potential for NZ$40 million to NZ$200 million in operational cost savings over five years.

NZME’s share price fell by 23% immediately following the Draft Determination. This reflects investor concern over the sustainability of traditional media models facing an 8% annual decline in newspaper circulation.

The merger would have created a unified platform with a daily reach of 3.7 million New Zealanders. Blocking the NZ$55 million deal prevents the formation of a local champion capable of competing with global digital platforms for advertising revenue.

ComCom says no to Fairfax/NZME merger – A short sighted decision?

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