Do you believe in fairness? Do you believe in freedom? Do you believe in Canada? Do you believe in puppies?
Both Sun News Network and its (primarily left-wing) opponents are debating the network’s application for mandatory carriage on cable and satellite systems, which was published on Monday and will be the subject of a CRTC hearing on April 23. Each has prepared talking points to further their causes for and against. Unfortunately, a lot of them are based on incorrect information or oversimplifications of complex issues.
This is primarily the fault of the CRTC, which has a very complex regulatory system governing television distribution (and in particular specialty channels), one that is constantly changing.
To help clear up some of this, I’ll offer some perspective on the claims made so far in this debate so you can form a better opinion (or, more likely, use them against your opponents in your Twitter flame wars).
For the claims from Sun News, I’ll primarily refer to tweets from “Canadian TV First”, its marketing campaign to support this application.
We’re just asking for what CTV and CBC got
What is #SunNews asking for? The same treatment that CBC News Network and CTV News Channel had when they started http://t.co/H2Rp1iOo
— CanadianTvFirst.ca (@CanadianTvFirst) January 24, 2013
This is the biggest argument in favour of Sun News, and it’s also the most complex to explain.
When the CRTC first granted the CBC a licence to operate a 24/7 news network in 1987, cable television was in its infancy. Canada had a grand total of seven cable channels that weren’t over-the-air stations: TSN, MuchMusic, The Life Channel (which had already gone under), Telelatino, Chinavision (now Fairchild), Télé des Jeunes (later replaced with Canal Famille, which was in turn replaced by VRAKtv) and MusiquePlus.
In 1987, the commission held hearings into the creation of new specialty channels, but also the method in which those channels were to be distributed. TSN and MuchMusic were discretionary services, meaning viewers could choose whether or not they wanted them. In its decision, whose process is explained here, the commission added new channels, including Canal Famille, MétéoMédia/The Weather Network, RDS, TV5, Vision, YTV and a news channel from CBC that would eventually launch as CBC Newsworld.
None of these channels had mandatory distribution, not so much because of the need for consumer choice, but to allow the cable companies to decide whether they wanted a channel or not. If they chose to take a channel, certain rules came into effect:
- In francophone markets, if a cable company wanted to add a French channel to its service, it had to add all the others (this was a special temporary rule to ensure those services got a good start)
- In francophone markets, if a cable company wanted to add one of the French channels, it had to distribute that as part of the basic service
- In francophone markets, cable companies wanting to distribute CBC Newsworld, The Weather Network, Vision and YTV had to do so on basic unless the broadcaster and cable company agreed to make the channel discretionary
- In anglophone markets, cable companies wanting to distribute CBC Newsworld, The Weather Network, Vision and YTV had to do so on basic, period
Eventually, the distribution requirements for CBC Newsworld and similar channels became known as “dual status”, meaning that the channel had to be distributed on basic cable unless the broadcaster and distributor agreed that it should be discretionary. This fits the definition of mandatory carriage. (And because cable companies were forced to carry the channel, its wholesale rate was regulated by the commission.)
CBC News Network is still distributed this way on analog cable.
In 1996, the CRTC licensed another wave of new services, including CTV News1 (now CTV News Channel) and Le Canal Nouvelles (LCN). CTV News’s original licence was “modified dual status”, which was the reverse of dual status: the channel had to be distributed on a (high penetration) discretionary tier, unless the two sides agreed that it could be distributed on the basic tier. In essence, it was up to the cable provider to decide whether they wanted to force the channel on all their customers or let them choose.
Now, remember that this was the 1990s, cable was analog and consumer choice in television packages wasn’t nearly what it is now. Many cable providers had only two options: basic and basic plus the discretionary tier. These were the days of “scrambled” channels, where the late-night pornography involved green people whose midsections swayed wildly from side to side, bathed in static.
Digital cable changed everything, allowing cable companies to choose exactly which channels a subscriber could have access to. This allowed for different kinds of channel packages and even à la carte selection (though most providers outside Quebec don’t offer that).
On digital cable and satellite, which is now in a majority of households, the CRTC has fewer rules for what goes on the basic service. They are essentially limited to local and regional over-the-air television stations (for which the provider does not pay a fee), at least one CBC and one Radio-Canada station, a provincial legislature service, a community channel, and those services for which the CRTC has ordered mandatory distribution.
CBC News Network is the subject of a mandatory distribution order, but only in francophone markets, at a rate of $0.15 per subscriber per month. In English Canada, it doesn’t have to be part of the basic package on digital cable or satellite, but there are few television providers that won’t offer it anyway since it’s one of Canada’s most popular specialty channels.
CTV News Channel is not subject to a mandatory distribution order, never has been, and cable and satellite providers have never been ordered by the CRTC to force it on all their subscribers.
In 2009, the CRTC decided that it would take a big step toward deregulating specialty services by opening up news and sports, the most profitable genres, to direct competition. CBC News Network and CTV News Channel were given a new class of licence, which included common obligations and also allowed them to negotiate carriage with cable and satellite providers, who could decide not to carry the channels if they felt the rate was too high. Sun News Network has this same class of licence.
It would be fair to say that CBC News Network had de facto mandatory distribution, in a cable universe of a handful of channels, and on an analog system that is now taking its dying breaths. But CTV News Channel has never been mandatory, even if cable companies decided to make it a basic cable channel.
I should also note that this argument ignores all the other news services in Canada: CP24, CityNews Channel, BNN and Global’s soon-to-launch BC1. You could also arguably add Hamilton’s CHCH television station to this group. None of these channels have or have ever had mandatory carriage (except CHCH, but that’s just in Ontario, and they don’t get any money for it).
It also ignores that Sun News is asking for an additional perk: lower placement on the channel grid. Though the CRTC did regulate channel position once upon a time, mainly for technical reasons because some people’s TVs didn’t go above Channel 12 or Channel 30, it hasn’t done so for digital services.
As far as the main argument, with one half right and one wrong, I’ll rate this claim half true.
Al Jazeera gets better treatment than us!
Many cable providers in Canada offer foreign all-news channels like Al Jazeera but still don't offer Sun News. Let's put #CanadianTVFirst
— CanadianTvFirst.ca (@CanadianTvFirst) January 22, 2013
Most cable providers and both satellite providers offer Sun News Network on their systems. The biggest holdouts are Telus, in Western Canada, and MTS, in Manitoba. Sun had to fight to get some (notably Bell) to add the channel, but that’s what happens in a deregulated environment (it’s also a two-person tango, with providers arguing that Sun was asking for too much money). Telus and MTS offer Al Jazeera English, probably because Al Jazeera is more concerned with getting into homes than getting money for it. It provides free live streams, free satellite feeds and even free over-the-air transmission in some places. It wouldn’t surprise me if the wholesale rate was zero or near zero.
Neither Telus nor MTS puts Al Jazeera English on its basic service.
Nevertheless, I’ll rate this one true, even if it’s missing context.
Sun News makes 96 hours a week of Canadian television
Sun News is 100% Canadian and produces 96 hours a week of Canadian content. Let's put #CanadianTVFirst! canadiantvfirst.ca
— CanadianTvFirst.ca (@CanadianTvFirst) January 22, 2013
Sun News has live or first-run recorded programming from 6am to 10pm weekdays, On weekends, it has six hours of original programming each day. By my count, that’s 92 hours total a week. I don’t understand where the discrepancy comes between my math and theirs (my best guess is that they count the three airings each of the one-hour Saturday Sun and Sunday Sun programs as three hours instead of one hour repeated twice), but the main point is valid: Sun News Network produces an awful lot of original Canadian programming every week.
Of course, so do other Canadian news and sports channels.
Since the mathematical discrepancy is minor, I’ll rate this one mostly true.
OWN gets more carriage than us!
OWN, Oprah's network, is more accessible to Canadians than @SunNewsNetwork. Sign the petition at canadiantvfirst.ca!
— CanadianTvFirst.ca (@CanadianTvFirst) January 22, 2013
This one is a bit complicated because of the history of OWN in Canada. First of all, the OWN they’re referring to is not an American network. It’s actually called OWN Canada, it’s owned by Corus, and it licenses the brand and most of the programming from Oprah’s American channel. As a Canadian channel, it’s also required to air Canadian content, which it does with shows like Anna and Kristina’s Grocery Bag.
OWN Canada began its life as Canadian Learning Television, later rebranded CLT, then Viva before becoming OWN. It’s licence is Category A digital (originally Category 1), which means that digital cable systems must make the channel available as part of a package.
That’s not mandatory basic distribution or even close, but it does have more rights than Sun News. That’s because as one of the older specialty channels, it has what are de facto grandfathered rights.
Those rights weren’t granted to OWN, though, they were granted to CLT. And the CRTC isn’t happy that what was licensed as an educational broadcaster has turned into a lifestyle channel. The commission considers that a breach of its licence and has threatened to revoke its licence.
When Sun News first started, it tried to apply for this same Category A licence. That would force all digital cable and satellite providers to make the channel available to customers. But the CRTC said no, because it had implemented a moratorium on new Category A services, and wanted new ones to start up in the less regulated Category B.
It’s something the CRTC might want to reconsider. Love it or hate it, Sun News produces a lot of Canadian content, and it deserves to be treated differently from channels like TVtropolis that air mostly reruns, or channels like OWN that are mere Canadian versions of American channels.
Though there’s context missing, the statement from the campaign here is true.
CBC News Network gets loads of government money
Which is massively subsidized by the larger CBC assets RT @acoyne: You’re a news/talk station, like CBC NN.
— Ezra Levant (@ezralevant) January 24, 2013
The CBC gets a hefty parliamentary appropriation every year. That’s why they’re the public broadcaster. But is CBC News Network, which charges a fee, government-funded?
According to the CRTC’s financial summaries, CBC News Network takes in more in advertising and subscription revenue than it records in expenses. In other words, it makes a profit, and has done so consistently over the past five years.
That has to be taken with a grain of salt, though. CBC News Network, like CTV News Channel, relies on the shared resources of a national network of local television stations and their news departments. It’s not easy to split salaries and other expenses between the two, and CBCNN’s expenses might not account for its use of other resources subsidized by the government.
Considering Ezra Levant’s wording here, I’ll rate this statement half true.
Sun News Network is available in only four of 10 Canadian households
Sun News on the other hand, is distributed like a third-rate foreign news service – available in only 4 out of 10 households with major BDUs like Telus and MTS not even offering it. This situation is unsustainable.
– Sun News brief to the CRTC
This statement’s meaning is left to interpretation. Does it mean only 4/10 Canadian television subscribers subscribe to the channel, or that only 4/10 Canadian households can access the channel?
Some quick number crunching suggests it’s the former. I don’t know how many cable providers make Sun News available, but I know that the major ones do. According to the latest CRTC Communications Monitoring Report, the major providers (Rogers, Shaw, Videotron, Cogeco and Bell) combine for 10.2 million subscribers out of 11.8 million total. According to the same report, 80% of subscribers have digital service, so that means at least 8 million of the 12 million (two thirds) could add Sun News to their service if they wanted to.
There’s an argument to be made that packaging disadvantages Sun News compared to CTV News Channel. Packaging is up to the providers (usually through negotiations with the broadcasters), and Sun News tends to be packaged in a news tier with channels like BNN, Bloomberg TV, MSNBC, Fox News Channel and Al Jazeera English (“third-rate foreign news service” presumably refers to one or more of these). But these packages aren’t too expensive for the most part (a few dollars a month), and people interested in news tend to be interested in more than one channel.
Because the word “available” implies that 60% of Canadians can’t get access to it, which doesn’t make logical sense considering its carriage among major distributors, I rate this statement mostly false.
Sun News said it would never ask for mandatory carriage
This one comes from, I think, a misreading of a debate back in 2010, when Sun News first applied for a CRTC licence. It wanted a Category 1 (now Category A) licence, which would require all digital cable and satellite services to make the channel available as part of a discretionary package. But many people (journalists and non-journalists alike) misunderstood that as being a licence that would force everyone to subscribe to the channel.
Kory Teneycke, the person in charge at the time, frustratedly went around trying to correct the record, saying the group had never asked for such a licence and wasn’t now, because it was “tantamount to a tax”. But, although that may seem hypocritical now, I can’t find any quote saying Sun News would never ask for such a licence.
Until I do, I’ll rate this one false.
Mandatory carriage is equivalent to a government handout
See above where Teneycke calls mandatory carriage “tantamount to a tax”. Sounds pretty government-handouty to me. Though as people on social media correctly point out, it wouldn’t apply to the 10% of Canadians who don’t subscribe to cable or satellite TV.
For the 90% who do, being forced to fund a channel they might never watch and probably don’t agree with would certainly sound like a tax.
I’ll rate this one mostly true.
Sun News needs preferential position on the dial because it lost ratings when Rogers moved it up
Rogers Cable did indeed move Sun News out of a low position (Channel 15) in the fall of 2011, shortly after it launched. This was because that channel was for the over-the-air television station CKXT, which was rebroadcasting the Sun News Network. This strange specialty-channel-over-the-air situation meant that cable systems in Toronto were forced to carry the channel, but didn’t have to pay for it. Asked by the CRTC to decide whether they’re a TV station or a specialty channel, Sun News shut down the station’s transmitter.
I’m not an expert in the effects of channel placement on ratings. There’s an argument to be made that lower positions (closer to the big broadcast networks) result in more people stumbling on a channel when they’re browsing. But the ratings drop probably has more to do with the fact that Rogers and other cable providers pulled the station from analog and basic digital cable when its transmitter went off the air.
Having incomplete information, I won’t rate this one. But even if channel placement did have an effect, I would rate it half true.
A look at cable grids also shows channel placements not nearly as scandalous as Sun News would suggest, putting the channel near its competitors:
|Carrier||CBC News||CTV News||CP24||CityNews||SunNews||BNN||CNN||MSNBC||Fox News|
|Bell Fibe (Toronto)||502/1502||501/1501||503/1503||N/A||531||504/1504||500/1500||1506||507|
|Shaw Cable (Vancouver)||26||17||N/A||N/A||177||58/221||33/220||94||142|
|Cogeco Cable (Hamilton)||26/926||77/819||37/822||415/821||195/705||60/818||33||133||127|
|Cogeco Cable (Drummondville)||27/535||102||N/A||N/A||N/A||N/A||42||149||N/A|
|Telus Optik TV (Vancouver)||91/615||92/706||N/A||N/A||N/A||93/707||94/650||97||103|
|Eastlink Cable (Halifax)||29/636||24/630||N/A||N/A||663||117/662||18/637||155||152|
Yeah, it’s clear from some of these channel selections that certain companies are giving preferential treatment to their own channels (Rogers for CityNews, Bell for CTV News), but are these assignments so outrageous that government intervention is required?
Sun News opponents (“the Media Party”) oppose only the Sun News application but not all the other ones from less worthy channels
Sun News has gotten the large part of the attention lately, and many services have received little to no attention (except for a couple of pieces about TV5 and Starlight). But the commentary about Sun News, such as the one from Andrew Coyne, is more about the hypocrisy of a freedom-loving free-market capitalist asking for government to force people to buy them.
While it’s true that commentators haven’t come out as forcefully against the other applications being considered, there’s no reason to believe they support all of them. So I’ll rate this half true.
Sun News airs “hateful and racist broadcasts”
This one is from a petition against the application. While this is more of a subjective thing, Sun News is governed by the Canadian Broadcast Standards Council, as well as Canadian laws banning hate speech. The only case where it got into trouble was when Ezra Levant used a coarse insult against an executive of the Chiquita banana company. There was also a split decision on a case of Michael Coren referring to “black thugs” that the majority found did not breach the broadcast standards code. There have been no criminal charges or convictions related to hate speech on Sun News broadcasts that I’m aware of.
You could argue there were cases that weren’t reported, or that the broadcast code isn’t strict enough. But these are the only objective ways we have to evaluate the network, and a general statement like that simply doesn’t fit the facts.
I rate this one mostly false.
Are there other statements you’d like me to check? Let me know in the comments.
For racist broadcasts, what about when Ezra Levant went on a tangent against gypsies? I heard a while back the Toronto police were investigating that.
From the petition: They publish hateful and racist broadcasts and we do NOT want to pay with OUR tax money for this type of journalism to enter our homes in any format
What tax money are they referring to? Is that true or is the petition just leftist, knee-jerk hysteria?
Mandatory carriage would be a de facto tax on all cable and satellite subscribers to subsidize Sun News Network.
Except that cable and satellite companies impose a 100% markup on all their subscribers, so at least half of this is pure opportunism. And nearly every cable and satellite company throws other services into basic and makes them pay for it, when they could easily cut some services and replace them with the new digital basic services, if any, so that their net cost for the digital basic is the same as (or even lower than) before. I don’t buy the whole “tax” business.
I don’t buy that it’s “easy” for them to just cut things out of basic. Cable and satellite companies don’t like giving things away for free. When channels are included on basic it’s usually because the demand for them is very high or because the contract between the broadcaster and the distributor requires a high level of penetration.
And with the number of services requesting mandatory carriage, the cost to the distributor alone would go up by $2.50 per subscriber per month. Plus the CRTC approving all or even a majority of these new services’ requests for mandatory carriage would open the floodgates to everyone else asking for the same.
By tax money, I mean money from government directly, à la CBC.
What’s the difference, for practical purposes? Are compulsory fees imposed by government agencies not taxes just because they don’t go directly to the government? Under that definition, things like employment insurance premiums aren’t taxes either.
So women’s network OWN Canada was originally named CLT? Shouldn’t that have been CLiT? Don’t tell me you weren’t thinking it also.
I wasn’t, since CLT wasn’t a women’s network.
I doubt there is a single cable/sat system in Canada that does not have CBC Newsworld on their basic tier. And until I got Videotron, CTV Newsnet was always included as well.
So while you may be technically correct that neither are mandatory, in reality if you don’t want either channel, you are out of luck. You must take them if you want even the most basic of service.
This has been pointed out to me as evidence that CTV News Channel has de facto mandatory carriage. But the key here is that it’s the providers choosing to include it on digital basic, not the CRTC forcing it. That may not change much from a consumer perspective, but I think it’s still a significant difference.
How is that any different from the cable and satellite providers choosing to double and pass on the digital basic services’ wholesale rates to their subscribers, which the CRTC doesn’t force them to do either? That may not change much from a consumer perspective, but I think it’s still hard to call it a “tax”.
I’m not sure where this “double” idea comes from. Cable and satellite companies don’t break down the price of their basic service between channel subscriptions and everything else. So I don’t know how we can establish that there’s a “100% markup” on the wholesale price of these services, or even if that’s relevant. We can talk about markup for discretionary services, but that is, of course, discretionary.
That said, you’re right that there isn’t much difference between the two. It’s the providers that set the retail prices, not the CRTC, so you can’t really argue that this is the same as the CRTC forcing the issue.
There’s talking points by Peladeau in today’s Gazette. I have a feeling some fact-checking will be needed there, too.
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Thanks for the good and thorough analysis. I don’t entirely agree with your assessment of “We’re just asking for what CTV and CBC got.”
CTV News Channel never had mandatory distribution, but for the environment at the time what it had was almost as beneficial. It had mandatory carriage and benefited from a regulated basic service wholesale rate. As you mentioned, this was at a time when most cable companies only had one discretionary tier. These circumstance gave the new channels huge negotiating power. If the cable company didn’t want it on basic they had to put the channel into their popular discretionary tier with the channel asking for “make whole” (ie pay us the same total $ as if we were on basic).
In addition, this was the era of negative option billing where many cable companies added discretionary channels automatically to customers cable packages, giving CTV Newsnet and others very high penetration rates.
I’d say this makes the CTV part of Sun’s claim at least half right.
One more thing. On their hours a week of Canadian television:
6am to 10pm weekdays = 16 hours x 5 days = 90 hours
It looks to me like they have 4 hours/day on weekends, not six. That’s a total of 98 hours.
16 x 5 = 80, according to my calculator.
For weekends, there’s Sun News Live from 9 to 11am, and again from 2 to 5pm, plus a one-hour Saturday/Sunday Sun show that airs at noon and repeats at 6pm and midnight. That’s a total of six hours each day.
I should try one of those calculators! ;)
You’re right. Looking at their schedule again, on Saturday I see Sun News Live from 2-3pm, but not 3-5pm. That’s where I got the 4 hours.
The schedule on their website is broken. It seems to forget a bunch of hours on Saturday and Sunday afternoons. The electronic schedule sent to TV distributors is more accurate.
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