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Dark day for public broadcasting: CBC/Radio-Canada denied value-for-signal

Kanada Kev

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Dark day for public broadcasting: CBC/Radio-Canada denied value-for-signal by CRTC

Ottawa, March 22, 2010 – The Canadian Radio-television and Telecommunications Commission (CRTC) today failed to fulfill its responsibility to maintain a healthy broadcast system that serves the interests of Canadians.

In its new framework for conventional broadcasting, the CRTC has allowed private broadcasters to negotiate a fair value for their signals with cable and satellite companies, but denied that same right to CBC/Radio-Canada. This is a piecemeal decision that deals with the decline in advertising for private broadcasters but not for CBC/Radio-Canada whose television budgets are 40 to 50 per cent dependent on commercial revenues. The decision recognises the market fragmentation that is harming private conventional broadcasters but is wilfully blind to the fact that CBC/Radio-Canada is subject to the same pressures.

Denying CBC/Radio-Canada access to the same revenue streams as other conventional broadcasters means that the CRTC has accepted that CBC/Radio-Canada’s budget and services should be reduced, and that the services offered by the public broadcaster are less important than those of the private broadcasters.

“The CRTC’s decision defies logic,†said Hubert T. Lacroix, President and CEO of CBC/Radio-Canada. “The Commission wants to save Canadian programming.

CBC/Radio-Canada invests more in Canadian programming than all of the other broadcasters combined. Denying us the same rights held by every other broadcaster in this country means that this supposed solution will not apply to over half of the Canadian content produced and aired in this country – over $650 million last year alone. This will solve the economic problems of private sector players but will not bring the system back into balance. It leaves the player who delivers more than anyone else in the system without a viable business model.â€

Since the advent of television in 1952, successive governments have determined that Canada’s public broadcaster would subsist on a mix of public and commercial revenue. The CRTC has itself encouraged CBC/Radio-Canada to pursue commercial revenues in order to fulfill its mandate and conditions of licence. Like the private broadcasters,

CBC/Radio-Canada is dependent on advertising revenues to provide its services and is being severely affected by a their decline.

“We’ve been evaluating the potential repercussions of a decision like this for several months now,†continued Lacroix. “One thing is clear: this will force us to cut programs and services, and our ability to fulfill our mandate has been compromised. The independent production sector, the cultural community, and the public will all suffer as a consequence. But we need to study the decision in more detail and present a plan of action to our Board before I can share more.â€

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CRTC calls for negotiations over value of TV signals; CBC/Radio-Canada excluded

Leaves final decision up to Federal Court

March 22, 2010 - The CRTC has ruled that Canada's TV broadcasters can seek payment for their over-the-air signals from cable and satellite companies, but is deferring the final judgment to the Federal Court of Appeal.

CBC/Radio-Canada is shut out of the negotiated solution. The CRTC said it would review the public broadcaster's mandate and funding next year.

"Broadcasters and distributors have a symbiotic relationship. The time has come for them to put their differences aside and work together to ensure the continuation of conventional television, which Canadians clearly value," Canadian Radio-television and Telecommunications Commission chair Konrad von Finckenstein said Monday in a statement.

The cable and satellite companies have argued that, under the Broadcast Act, the CRTC doesn't have the authority to force payment for conventional television signals.

The CRTC said it must consult the court to ensure it has the jurisdiction to impose the negotiations between the two sides.

Changes to programming requirements

The Commission is also changing the Canadian content programming requirements by forcing broadcasters to invest a minimum amount in domestic productions instead of simply requiring them to air it.

It also decided to get rid of quotas forcing broadcasters to air Canadian programs from specific categories and will also lower the Canadian content requirement from 60 per cent to 55 per cent. At the same time, it will continue to require that 50 per cent of prime-time programming be Canadian in content.

The decision follows a bitter battle that pitted cable and satellite companies against conventional television networks characterized by ubiquitous advertisements trying to convince consumers the other side was just being greedy.

Highlights of CRTC ruling

* CRTC sets out framework for "market-based solution" to allow private-sector conventional TV broadcasters to negotiate with cable and satellite providers to net compensation for signals.

* Under solution proposed, private-sector TV broadcaster can opt to stay in current regulated system, or choose to enter negotiations. Once choice is made, the decision is final. Agreements between broadcasters and cable are expected to last three years.

* Broadcasters could seek fee for its signals, or other "non-monetary" compensation.

* CRTC to seek legal opinion from Federal Court of Appeal, to ensure it has authority to implement such a market-based regime.

* CRTC provides more flexibility on Canadian content requirements. Private broadcasters would still be required to spend 30% of gross revenues on Canadian programming, but be allowed more leeway in terms of which channels – conventional or specialty – the programs can air on.

* CRTC will allow paid advertising on video-on-demand programming, creating another new source of revenue.

* The Local Programming Improvement Fund will be maintained in its current form, with cable and satellite companies paying 1.5% of gross revenue to help fund local TV.

* Current policy restricting the sale of advertising in the local availabilities of programs broadcast by foreign pay and specialty services is kept (usually two minutes per hour, used primarily for the promotion of Canadian programs).

* The Commission launches a proceeding to ensure an orderly transition to digital television for consumers.

* Appropriate measures for the French-language market (TVA and V) to be considered next year.

* CBC/Radio-Canada's "unique mandate and needs" will be discussed in the context of the next licence renewal.

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