CRTC Roundup: Details on CJNT/CHCH sale

The CRTC has called a hearing for Aug. 24 to hear Channel Zero’s proposal to buy CJNT Montreal and CHCH Hamilton. The application includes some goodies we didn’t hear about in the announcement in June.

The purchase price for both stations is $12, specifically:

  • Land $3.00
  • Buildings $3.00
  • Other Fixed Assets $3.00
  • Goodwill $3.00

The stations would be financed through a loan of $4 million from CIBC and Brian C. Hurlburt, and $3 million from Channel Eleven. That would go to increasing the size of CHCH’s newsroom and creating a new production facility at CJNT, plus eventually changing both stations to digital.

Canwest can pull out of the deal if CRTC approval is not given by Aug. 31. Channel Zero expects the CRTC will make a decision on the same day as the hearing, I guess.

The proposed programming grid for CHCH would be as follows:

  • Weekdays: News and local progamming from 5:30am to 7pm, followed by two movies, news from 11-12, a repeat of the prime-time movies and a really-late-night movie from 4am to 5:30am
  • Weekends: News and local programming from 6am to 1pm, followed by two movies, a one-hour 6pm newscast, two more movies, a one-hour 11pm newscast, and then three repeats of movies shown that day

The proposed programming grid for CJNT would look like this:

  • Local ethnic programming in the morning and during the evening supper hours (four hours a day total)
  • Music videos during the day
  • International ethnic movies during prime time
  • Movies (it’s not clear if this would be ethnic or not) overnight

On how they’ll bring the stations to get rich quick modest profit:

A short answer is that we will, if the application is approved, focus each of these stations on their core competency; news and local programming at CHCH and relevant and local multi-cultural programming at CJNT. We will not be relying on expensive first run U.S. programming and therefore we can bring the stations to modest profitability in a relatively short time frame.

A table of financial projections optimistically shows CJNT showing a profit as early as fiscal 2011, mainly due to the assumption that local advertising sales will have more than tripled by then, from $1.2 million a year to $4.3 million, despite the fact that they’re replacing first-run U.S. shows by less-expensive movies in prime-time.

Similarly, ad sales at CHCH are expected to recover to $43 million a year (on par with pre-recession levels, optimistic since more than 80% of that advertising came from non-news programming which Channel Zero would be getting rid of), which combined with spending $30 million a year less on programming expenses, and the CRTC’s new taxes on cable companies, would result in seven-figure profits beginning in fiscal 2012. Without its projected $4 million a year from fee for carriage (it predicts a “75% likelihood” for that “by 2011”), the station would stay in the red until 2014.

Channel Zero is also asking for changes to the licenses for CHCH and CJNT. Among them:

  • Deletion of a requirement for CHCH to have a minimum level of “priority programming” (things like Canadian dramas and news magazines). It argues such requirements are not asked of small stations, only of large broadcast groups.
  • Deletion of a requirement at CHCH for an independent monitoring committee, since these are related to Canwest’s cross-ownership of various media which Channel Zero does not have
  • Deletion of a requirement for CHCH to air four hours a week of described video (with the understanding that the station would use described video where available)
  • Removal of a requirement for CHCH to have distinct programming from Global’s CIII-TV Toronto, which becomes moot if CHCH isn’t owned by Canwest.
  • Deletion of a requirement for CJNT to make sure 25% of its films are Canadian (Channel Zero argues there aren’t enough foreign-language Canadian films to make that feasible – and it will abide by other Canadian content requirements)
  • Deletion of a requirement for French-language non-ethnic programming. Canwest twice asked to be relieved of this requirement, and was turned down twice by the CRTC. Channel Zero argues the station must focus on one market for non-ethnic programming, and the French market is already saturated here. It’s hard not to agree with that logic.
  • Increase in minimum requirements for local ethnic programming from 13.5 hours to 14 hours per week

The Canadian Media Guild’s Lise Lareau looks a bit skeptically at Channel Zero’s plans for CHCH in Hamilton, notably the requested license amendment to remove the requirement to air Canadian dramas and movies in prime time.

UPDATE: The CHCH union, which has agreed to support the sale in principle, is grieving Canwest’s plan to wind up its pension plan before the sale.

Campus/community radio review

The CRTC is undergoing a broad-based review of its policies for campus and community-based radio stations. Among the questions it’s asking:

  • Should campus and community stations be treated differently?
  • Should high school stations be licensed?
  • What kind of programming requirements should they have?
  • Should low-power “micro” radio stations be licensed or exempt from license?
  • How much advertising should they be limited to?

The deadline for comments is Sept. 11. The hearing is Nov. 30 in Gatineau.

Not so bold

After being slapped on the wrist for violating terms of license, the CBC has made good on its promise to request an amendment to change the nature of its specialty channel known as Bold. Formerly called Country Canada, the channel was licensed as a network for rural Canadians from a “rural perspective”, but since its transformation into bold (they don’t capitalize the B, so as to remain edgy or something) it’s basically been a network to throw leftovers at. It airs everything from drama reruns to soccer games.

The CBC’s argument for the change boils down to this:

There is insufficient programming from a “rural perspective” to program the service.

Sorry farm people, but you’re just not interesting enough for a whole channel, even with Heartland and Corner Gas.

New programming categories

Since the CRTC announced that it would allow specialty networks access to all programming categories when asked, they’ve gotten some requests for exactly that.

Astral Media is asking for access to all programming categories for Canal Vie, Canal D, Historia, MusiMax, VRAK.tv, Ztélé and MusiquePlus

TVA has received approval for Les idées de ma maison to air up to 10% animated programming. Argent and Mystère have access to a slew of new programming categories, everything from religious programming to feature films and music videos, so long as they fit with the channels’ themes and don’t compete with other networks and don’t go above 10% of the broadcast day. Prise 2 also gets categories added (see below)

Prise 2 must keep its CanCon

Prise 2 can now air TV programs that are as little as 10 years old (the previous minimum was 15) and movies as little as 15 years old (previously it was 25), as well as access more programming categories (documentaries and live sports, limited to 10% of the broadcast day). A request to reduce their CanCon requirement from 35% to 30% was denied.

Télé-Québec, Canal Savoir stay on the air

While the major networks (TVA, CTV, Global) got one-year license renewals as they sort out that fee-for-carriage thing, the smaller non-profit networks are being renewed for the full seven years.

CFTU (Canal Savoir) has been renewed for seven years with no changes to its conditions of license (except a reminder that it will need to transition to digital by August 2011).

CIVM Montreal (Télé-Québec) and its retransmitters across Quebec were also renewed until 2016, with some considerations about representation of minorities but otherwise no changes.

Corus gets more steamy

Corus Entertainment has come to an agreement to buy Sex TV and Drive-in Classics, two specialty channels, from CTVglobemedia. The next day Corus reported a $145-million quarterly loss. Last year Corus bought CLT from CTV and rebranded it VIVA.

In other news:

8 thoughts on “CRTC Roundup: Details on CJNT/CHCH sale

  1. Fortran Coderer

    I received Bell’s statement about the new LPIF:

    In late October 2008, the CRTC created the Local Programming Improvement Fund (LPIF) to take effect in September 2009 and to be paid via a 1% charge applied to the TV revenues of satellite and cable companies. The LPIF was initially designed to subsidize the production of additional local programming in small communities by TV stations.

    More recently, on July 6, and before the LPIF takes effect on September 1, the CRTC increased this tax to 1.5%. Furthermore, the CRTC has now decided that funds generated by the LPIF tax need not be spent by TV stations on additional local programming and, in some cases, has lowered the local programming obligations of TV stations.

    Bell is extremely disappointed by the CRTC’s latest decisions regarding this TV tax and, in order to meet the CRTC’s orders without impacting the current and future quality of its products and services, Bell will apply a monthly fee to customer billing which will not exceed 1.5% of Bell TV charges incurred on and after September 1, 2009.

    The CRTC also supports an additional new TV tax, commonly called fee-for-carriage, which Bell opposes. This additional tax would see satellite and cable consumers pay more for access to TV stations that have always been available free over the air. If implemented, this new fee-for-carriage TV tax will result in further increases to customers’ bills. The CRTC is holding a public hearing related to this new tax in the fall.

    Some online comments by various forum members regarding the proposed tax:

    “Yet more farcical policy from the CRTC. Are these yahoos in the pocket of CTV/Canwest, or do they just work really hard to make it look that way?

    One day I should add up just how much of my cable bill is imposed on me by the government to fund crap that I don’t watch and don’t want to pay for, and compare that to how much is for the channels I actually want. CTV/Global are nothing but retransmitters of US programming.

    Then again, maybe not. That would be a good reason to drop TV entirely.”

    “I would have some respect for the CRTC if they had done this before almost all the small market stations were sold to CTV/Canwest and before smaller networks like CH, Craig and Chum were dissolved. As it stands, it’s a hindsighted piece of pork that stinks of corporate nepotism on the part of the CRTC and the federal government. Due to CTV’s and Canwest’s drastic local programming cuts in small markets, those areas are not being served well. The CRTC’s actions that let CTV and Canwest maintain the status quo does not serve Canadians.”

    “I will be canceling Bell TV come September 1st as well as writing a letter of complaint to my MP. The CRTC is out of control.”

    “So what exactly does this get a BDU subscriber in Red Deer, Alberta who’s losing their ONLY station on September 1st? Paying for funding an Edmonton local news? Thanks for NOTHING, CRTC! Must be nice that big Canadian broadcasters (CTV, Global) can get away w/ blackmailing the CRTC.

    This “fund” allegedly pays for small-town local news, but it WON’T stop the loss for secondary ‘A’ stations for CTVglobemedia. Won’t make them even break even and won’t make them a profit. So I predict we’ll see only a calendar year for the remaining ‘A’ stations (starting Sept. 1, 2009), then they’ll shut them down. So this “fund” is only paying for an additional year of local news at most; just postponing the inevitable.”

    “I have decided that the day this tax shows up on my bill, I will cancel my TV.”

    “My advice is to go digital OTA if you can. It’s free, and the CRTC can take a flying hike with this nonsense. Asking consumers to fund local stations while at the same time cutting down the number of local hours to be aired, shows that this is not a issue to save local TV.

    Just thinking… It would have been better to use the 100 million collected to have the government purchase the stations that CTV & Global want to kill, hire a firm to turn those stations around, and then offer a IPO on those stations to the public. At least we would see our money well used. And actually show some sort of profit.

    This CRTC plan just forces consumers to throw good money towards bad situations, with a no ending in site.

    Honestly, look at what you can do to go OTA. It won’t work for eveybody that doesn’t live near the US border. But, it can help some people. I see no reason why the Canadain public should be financing bad companies, bad mangers.”

    “On my monthly e-bill today:

    TV service providers such as Bell have been ordered by the CRTC to contribute to the Local Programming Improvement Fund (LPIF) to subsidize TV station programming. To fulfill this obligation, starting in September 2009, Bell will apply a monthly fee which will not exceed 1.5% of your monthly Bell TV bill. Please visit http://www.bell.ca/lpif for more information.

    I sent a letter of disgust to the CRTC, might as well have written to Santa Claus; tomorrow I will give Bell my 30 days notice of cancellation and revert to rabbit ears.”

    “We have to vote with our wallets. The CRTC and our MPs will not give a crap. The providers have far more influence. As I said above, I will be canceling also. So far there are three of us.

    I am lucky I have the option of OTA and other nefarious sources for TV.”

    “That is some consolation. I wonder if CTV and Canwest small market stations quality. If so, the money is still going to the wrong stations, IMHO. I guess CTV’s threats worked on the CRTC. No doubt they will be back with more demands soon.”

    “But it will go to the owners of those small market stations who “lo and behold” are often owned by CanWest, CTV etc. Anyway you look at it, this is $100 million dollars of corporate welfare to companies that spent billions over the last few years on buying specialty channels and other companies. The CRTC is simply giving them more money for more takeovers.”

    “Can someone please tell me what this $100 million buys us? That’s the $100 million dollar question.

    Evidently the answer is nothing. It’s a bailout for CTV and Canwest on the backs of the consumers and nothing more.

    What we have here is consumers being forced to pay for channels they already get both from BDU’s and over the air, that are already being subsidized by the Canadian Television fund, and who run their business’ with reckless abandon.

    The hypocrisy of this whole situation is laughable. We are paying more so these channels can produce more Canadian programming, when in actuality, the money will go to pay for all the American programming they are not forced to buy. If these channels were truly Canadian, and used all their resources to fund Canadian programming, then they wouldn’t be in the position they are.

    They spend millions to acquire American programming, while sticking their hands out for more funding to supposedly keep local programming afloat. Not only should we not be giving them anymore money, but we should be suing for fraud. Only in Canada.”

    CRTC — you’re ticking off more and more people everyday.

    Reply
  2. Shawn

    I’ve got a Montreal radio/CRTC question: I noticed on my Galaxie Radio feed on Videotron that Montreal Alouettes football is on CHOM, of all places. How long has this been so? Did they to appy for a license change to play sports? And why did sister station CJAD no longer want to carry it?

    Reply
    1. Fagstein Post author

      CHOM has been carrying select Als games for at least a few seasons now. CJAD carries the entire regular season and will continue to do so. CHOM’s last Als broadcast of the season was this week, now it’s limited to CJAD, CKAC and occasionally 98.5.

      As far as I know there was no license change involved in this. Most licenses allow for random stuff as long as it doesn’t take up the majority of the schedule. One might ask what the point is, however, since nobody tunes to CHOM for sports.

      Reply
  3. Shawn

    Hey, on a slightly off-topic: did anyone happen to catch the simulcast repeat of the Office last night (August 6) on Global? Even by Asper-standards, it was shocking: additional Global commercial breaks cut jarringly into the show, in places where clearly the NBC feed had none, more than once cutting off Micheal Scott in mid-sentence!

    How the hell do they get away with it? By contrast, I have never found CTV’s simulcasts as obtrusive or ham-fisted.

    Reply
  4. Tom Davidson

    I’m really glad that Bell TV has decided to take CTV / the CRTC to court. Even if this only delays this fee for a few months, it’ll give the rest of us time to look at alternate ways of getting our TV signals (DirecTV, C-Band Dish, shows via bit torrents). I’m still not sure why cable and satellite subscribers have to pay this fee, but those who watch TV OTA (who are more likely the ones to be watching those channels) pay nothing extra. This seems very discriminatory to me.

    It sounds more like the BDUs are being thrown through a closed door. The CRTC forces the BDUs to carry the channels and now say “oh you should pay for those signals we are forcing you to carry”, even though we have said “no, they shouldn’t be paid for it twice already”.

    Both CTV and Global own speciality channels that make a profit but they do not seem to figure into the equation. They sure figure into the equation though when it comes to advertising on them. TSN has become annoying to watch with the constant CTV promos every commercial break – and here I thought they were seperate entities when it came for the purposes of this tax itself, with CTV stating their profits from specialty are separate!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

    With the implementation of the LPIF and the soon to be FFC, I have chosen to offset the increases I will pay right now by reducing the amount of specialty theme packs I have and have focused on removing ones that are mostly full of CTVgm and Canwest channels. But in the near future, I will be cancelling my Bell TV account and going with either DirecTV or a large ugly C-band dish.

    Reply
    1. Fagstein Post author

      The problem with arguing that CTV and Canwest own specialty channels is that they bought those channels because of the problems facing conventional TV, and their response to such an argument might simply be to close down their conventional networks and just focus on the specialty channels (like Astral Media, which doesn’t own a conventional TV network but has lots of specialty channels). Both CTV and Canwest have closed or sold conventional TV stations as they plan for new specialty channels.

      Reply
  5. Pingback: Fagstein » CRTC okays CJNT, CHCH purchase

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