The battle for “fee for carriage” – forcing cable and satellite TV providers to hand over money to over-the-air broadcasters – is getting ugly.
A few weeks after CTV got Global and the CBC to join its “Save Local TV” campaign (now rebranded “Local TV Matters“), Bell (which owns the largest satellite TV provider) and Rogers (which owns Rogers Cable) have launched the counter-campaign Stop the TV Tax. Both websites feature “facts” pages with incredibly misleading arguments and statistics about the business model of television, and both are racing against the clock to get people to support their side in upcoming CRTC hearings on the fee for carriage issue.
Notably absent from either side is Quebecor, which owns the TVA television network (and Sun TV station in Toronto) but also the Videotron cable service. CityTV, the other notable absence on the broadcaster side, is owned by Rogers, which has clearly picked the other side in this debate.
The “TV tax” website has prompted CTVGlobeMedia to respond by calling it “misinformation”, while in the same release saying that cable companies are charging Canadians for conventional television, which is demonstrably false.
While CTV et al’s claims are suspect, the Rogers and Bell throw up some doozies of their own, including fantom quotes saying incorrectly that this is a “one time” fee. Except nobody said fee for carriage would be a one-time fee, and the website provides no source for this supposed quote. They also claim that conventional broadcasters had profits of $400 million last year, but the CRTC put that number at only $8 million (down from over $100 million) when it released statistical data in February. (UPDATE Oct. 6: I asked the Stop the TV Tax people about this, and they pointed to a Canwest quarterly report and an opinion piece about CTV, neither of which break down profit by conventional vs. specialty channels, and on Global’s side the operating profit for its non-Alliance-Atlantis TV network – which still includes a half-dozen cable channels like MovieTime and TVtropolis – was about $40 million)
When it comes to choosing between greedy broadcasters and greedy cable and satellite companies, most informed Canadians would prefer to choose neither. These slick (and expensive) lobbying campaigns – just think of how much they’re spending to lobby the CRTC directly if they’re spending this much on us – only reinforces the fact that both sides have plenty of money to spare.
This whole save local TV is a scam. Why should people pay an extra fee for TV channels that are already licensed to offer free over the air service. Those licenses to those companies are using public air ways to make money. Now they can’t make money because they’re badly run. So they want the cable & sat subscribers to pay them for what they are suppose to offer free to the public. But of course that fee will be passed on to their customers. And they know it. Sorry, but they have no business demanding to put their hands into the publics pockets. If they no longer want to offer over the air TV, then they should return their licenses to the CRTC, and the CRTC can request new applicants for those licenses. I understand CTV is having problems, and Canwest Global is barely keeping it’s head above water. But they got themselves into this mess. They need to put their houses in order. Not go to the publics house and demand extra money for what they have already agreed to provide. What really ticks me off though is the CBC’s involvement in this. They already get money from the public pocket. They are also allowed to run ads, and again they seem to think they deserve to get more money. Sorry CBC/SRC, it’s time for you as well to get your house in order. You should be ashamed of yourself. PBS with less money, no ads makes you look foolish.
Now, I’m no fan of the Cable/Sat services either. It costs way too much, and is filled with garbage channels. But, a lot of those channels are also owned by CTV, Global, and CBC/SRC. So what goes that say about this whole situation.
It’s clear that the CRTC will need to look at the way this industry is operated. A few lessons from the FCC maybe required. Having an over the air license to broadcast is a privilege, not a right. They must provide local TV. If not, pull their licenses, and let somebody else come in.
Considering the number of small-market stations that have been shut down recently (there is now no commercial television station in Manitoba outside of Winnipeg), that kind of policy will probably mean the elimination of local television outside a few urban centres.
It is really hard to figure out the facts in this case. Howver, it goes without saying that rural areas like ours are now suffering the results of the loss of our local channels such as the MCTV channel in Timmins, Ontario. I don’t mind paying an extra $10.00 a month to get my local channel back. I will simply have the cable provider cut off some of the garbage specialty channels that we never watch, which will decrease my bill about $20.00 per month. Maybe the bigger stations are making lots of money, but there are lots who aren’t because the population to float them through ad revenues is not there. Don’t hand me the bull about “not enough population – then do without.” After all, the big centres are busy taking our natural resources and profitting from them, when WE do the hard work digging up the gold. The government needs to find a way to ensure that these local stations survive. I could care less about the big city stations, our small stations contribute to our quality of life.
Again this whole problem is the same one affecting radio: so much is owned by so few.
The first convulsions of a medium destined for death. The internet has mostly taken over music, it’s working on books, conventional phone service is on its way out to be replaced by free VOIP, television is well entrenched, but the fact is no one is going to pay for content when they can get it for free, especially overproduced generic crap shown nationally with nothing in it of local interest. Why watch the news when you can read Montreal City Weblog and Fagstein? Why watch (or pay for) broadcast TV when you can download any TV program you could want practically instantly, in high quality, and commercial free.
Isn’t CTV owned by Bell? If so, are we witnessing one subsidiary of BCE suing another subsidiary of the same corporation?
Bell Canada has a 15% interest in CTVglobemedia. The rest is split between the Thomson family’s Woodbridge Company, the Ontario Teachers Pension Plan, and Torstar (which owns the Toronto Star).
And to be clear, this is an information and lobbying campaign. There are no lawsuits here.
A bunch of babies, especially CTV and CanWest who simply want everybody to pay for their badly misguided (and overprice) media concentration strategy that has now backfired. The CRTC should just compromise and tell the networks to freely negotiate fee-for-carriage but, in exchange, cable and satellite will no longer be forced to provide simultaneous signal substitution. Then watch the networks say something along the lines “oh, well never mind then.”
I am against this and have been from the start. If I receive a the signal of from the broadcasting station via satellite or cable it will cost me money. But if I receive this signal over the air by a conventional TV antenna it will not cost me money.Sound like nothing more than a money grab from the networks and discrimination against those with cable or satellite.
Mispinformation from both sides.
Hi Steve,
The $400 million figure is derived by combining published operating profits presented by CTV and Global within their annual reports and filings with the CRTC.
Here are some useful links for your readers:
http://j-source.ca/english_new/detail.php?id=3533&PHPSESSID=dd4b2f984c3e75887592e2aefd0652ed
http://www.newswire.ca/en/releases/archive/January2009/14/c6996.html
Do you have a CRTC source for these “published operating profits”? Because the link I provided still lists it at $8 million for the industry. Your links are to (1) an opinion piece which doesn’t source its facts, and (2) a quarterly report which doesn’t show a figure for conventional television.
Fassero:
Exactly. If CTV and Global are actually really concerned about receiving compensation for their signals because of “local TV”, they won’t mind that simultaneous substitution is dropped because that wouldn’t affect local news. But of course they’ll come out firing if they hear even the slightest of indication that simsubbing will no longer be required with a FFC. They live and thrive (they are, after all, parasites) off the US production studios.
I don’t think either CTV or Global would deny this. Their argument is that the profits made from U.S. programming (which is still the most popular in Canada) is used to support money-losing local news operations.
Well, since fee-for-carriage supposedly would make local programming (including news) more cost effective to produce, then they don’t need the simsubbing anymore. And, of course, that’s why the whole campaign is a joke. They want the carriage fees AND the simsubbing and the entire reason is to finance the lavish sums they pay for U.S. programming (often absurd because each network wants to stockpile content so the competition can’t get it and the U.S. networks know this) plus manage the piles of debt they accumulated trying to form giant media monopolies. Even if they got the handouts, bet dollars to donuts within a year they’ll be begging the CRTC to cut their domestic content limits even more. Local news in most cases is pretty much an oxymoron anyway (except in the Quebec French market which is probably why we don’t see any of those players joining in looking for the handouts.)
Local news is judged based on expenses vs. advertising revenue for the newscasts. That equation won’t change under fee for carriage.
Don’t think the Quebec French markets are better serving local news. TQS has no local news at all, and TVA stations outside Montreal and Quebec City are required to produce only five hours a week of local programming (and that’s up from 3.5 hours).
We’re kind of quibbling with words and probably meaning about the same thing. The networks are basically arguing that having “subcriber” revenue on top of the ad revenue would make the local programming (which is really mostly news these days) more profitable/less money-losing. On the French market part, I was too ambiguous. My intended point was that the Quebec stations/networks are not as money-losing as the English networks but, of course, that’s really only because they never really went on big television acquisition binges. I think the French stations deliver more localized content than the English ones but by the thinnest of hairs.
I’m not sure I’d buy your take on the “equation”. If literally true, all you are doing is re-inforcing the notion that the networks really want fees to give them more cash to even more overpay for (mostly U.S.-based) programming. Local programming from over-the-air is almost entirely comprised of news now. I think you’ve displayed enough study on how truly “local” the Montreal-based network affiliates are in terms of their newscast breakdowns (i.e. lousy).
By the way, I’m not totally apologetic to the broadcast providers (cable/satellite) either. There is something not so nice about the way they literally force consumers to buy channels they don’t even want and the way they merely transferred to new revenue cut by just arbitrarily raising everybody’s bills by the same percentage was appalling. However their “stealing free channels” and charging for them is worth a fortune to the networks due to simsubbing which they could not possibly derive otherwise.
I think you can also bet on CTV getting more and more one-sided in this whole matter if only because their debt picture looks to be far worse than CanWest’s.
You remember one of them just went bankrupt, right?
Absolutely. But I was talking about absolute dollars. TQS wasn’t, like, $1-billion plus in the red. And, of course, one of it’s control owners when it filed was…….CTV Globemedia. And even so, Remstar bought it for quite a bit more than 3 bucks.
Not to mention that the broadcasters are bumping advertising on their channels to run rebuttals immediately after the BDU’s ads.
It amuses me that the television stations are in the financial difficulty they are in because the advertising market has been saturated and has been hurt by the global recession. They only have so many minutes of advertising inventory in a day.
However, if they were not on cable and satellite in the first place that inventory would be worth even LESS!
They need satellite and cable more than satellite and cable needs them. No advertiser will want to advertise on mediums that are not seen on cable and satellite. Why doesn’t anybody talk about this?
What will be next? Ask the internet providers to pay local TV channels a fee for allowing the said TV stations to have websites and streaming video. Again the locals need internet and cable and satellite to survive.
I have satellite – tax or no tax if you are not on one of my 800 channels I will never watch. I do not have an antenna attached to my TV. Local TV better get more creative than asking for a hand out from people who don’t need them.
I think the CRTC should give the TV stations the right to ask for fees and then let them negotiate with cable carriers. But I think netwroks would fold pretty quickly if they were exposed to a lockout by the cable companies.