CTV applies for ‘regulatory relief,’ says A-Channels lost $98 million since 2007

CTV Ltd. has applied to the CRTC to reduce the Canadian content requirements for its A Channel stations that the broadcaster says have lost $98 million since 2007 and “continue to lose tens of millions of dollars annually.” “Given the continued uncertainty facing the conventional television sector, CTV is not in a position to continue to underwrite significant losses at the ‘A’ Stations for the foreseeable future having already lost over $98 million since 2007,” CTV wrote in an application to the commission. In CRTC broadcasting decision 2010-167, the commission said it is changing the Canadian programming requirements at the end of the next broadcast year for English-language television stations operated by CTV, Canwest and Rogers. But CTV says it needs to accelerate that process, and is calling for relief for its A-Channel stations. The stations are currently required to broadcast a minimum of eight hours per week of Canadian programming between 7 p.m. and 11 p.m., and to ensure that at least 75 per cent of its Canadian priority programming throughout the year comes from independent producers. The broadcaster is asking that these conditions be removed—consistent with the commission decision 2010-167. Also in line with that ruling, CTV is asking to reduce the A-Channels’ overall Canadian content exhibition requirements from an average of 60 per cent of the broadcast year to 55 per cent. “We are hopeful that under the new regulatory model noted above, there will be a future for these stations,” CTV wrote. The broadcaster added that the move is necessary “to ensure the ‘A’ Stations are in a position to continue to operate in the short term.” Canadian programming is identified Canadian drama, music, dance or variety programs; long-form documentaries; or regionally-produced programs. CTV said that, by the end of the current broadcast year, it expects the A-Channel stations to have lost more than $98 million since the company purchased them in 2007. “Unfortunately, these circumstances have forced us to look for ways to cut costs, both in terms of programming and staff,” CTV wrote. Ian Morrison, spokesman for the Friends of Canadian Broadcasting watchdog group, said in an interview that CTV is trying to take advantage of existing broadcasting policy. “Any well-informed observer would come to the conclusion that it’s desirable to reduce their various commitments, including Cancon commitments, to keep the stations on the air,” he said. Morrison added that CTV may be trying to make the stations more attractive to potential buyers. He said he does not believe CTVglobemedia wanted the stations to begin with when it took control of them as part of its $1.7-billion acquisition of CHUM Ltd. in 2007. CTV said in its application that, over the previous three years, it has spent about $240 million on the A-Channels’ programming schedule. The broadcaster said ratings have improved significantly, but that a “structural decline” in the over-the-air television sector, combined with the recession, “have made it impossible to monetize this ratings success.” In 2009, Canwest Television sold local stations in Victoria, Hamilton, and Montreal and closed another in Red Deer, Alta. CTV pointed out that independent buyers of the Canwest stations paid “essentially nothing” for them and received authorization to operate under flexible licences with limited or no obligations for Canadian content or independently produced programming. The six A-Channel stations identified in the application are CIVI-TV Victoria, CFPL-TV London, CHWI-TV Windsor, CKVR-TV Barrie, CHRO-TV Pembroke and CHRO-TV-43 Ottawa. Norm Bolen, president of the Canadian Media Production Association, said in an interview that CTV is rushing a process that should be determined when the commission opens a proceeding to consider broadcasting licence renewals. Broadcasting licence renewal hearings are expected next spring. “We think it’s inappropriate for any broadcaster to go before the commission and to cherry pick certain elements from the group licence renewal framework,” Bolen said. “Everything will be considered as a package by the commission. That was the intention of setting up the framework in the first place.” Bolen noted that although CTV’s A-Channel stations are not doing well financially, CTV “has other parts of their business that is very profitable”—an indirect reference to the broadcaster’s specialty channels. “You have to play by the rules,” he said. CTV said its proposed changes would be effective Sept. 1, 2010, and would allow the stations to “make local programming their primary focus as CTV works to improve the group’s financial performance in the short term.” Granting the “relief,” CTV said, would help the broadcaster develop a plan for the group of channels when it applies to renew its broadcasting licences this fall. Comments on the application can be submitted to the commission before Aug. 3, 2010. sdoyle@thewirereport.ca

CTV applies for ‘regulatory relief,’ says A-Channels lost $98 million since 2007

Broadcast | June 30, 2010

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