Ann: Change in substantial holding, page-10

It seems like they've just thrown this into the "too hard" basket to even put a recommendation on, and I would not be surprised if it is due to the fact that most of Intelligent Investor's subscribers tend to be older who have less appetite for risk. So instead, they've just put it out there for people to think about and make up their own minds.

While I don't have a favourable view of the long term health of NZM's media assets, I think people are overestimating the pace of their demise and are too quick to write them off as worthless. This is not the #3 or #4 media player in NZ (which you could write off as worthless). NZM has media assets that are  #1, and they are converting people to a paid subscription model - paying digital subscribers are increasing, not decreasing - and given governments here in Australia have been keen to force tech giants like Google and Facebook to pay Australian media companies for content in Australia, I would not be surprised if NZ does the same in the near future.

The company itself has said previously that "Google has announced that it will bring Google News Showcase to New Zealand by the end of 2021. We look forward to discussing with both Google and Facebook arrangements in regard to accessing and supporting editorial content.”

That's not to say this transition is going to be a walk in the park - NZM will need to continue to fight hard. But, while the media assets are very unlikely to be turning into great businesses, I think it is far too harsh to assume they're going to end up worthless soon.

What I think is understated is the probability of success for OneRoof. OneRoof was established only three years ago in 2018 and in three years it has already become the #2 real estate portal in NZ and is well on the path to becoming at least NZ's version Domain for Auckland. OneRoof has literally gone from zero to 6% of income for NZM in just three years - and most of that has been through a pandemic!

In summary, I think the 'old media' assets are worth more than zero, and the new media assets have shown very good signs they are on the path to success.