CRTC proposes fund for local TV news

The CRTC is proposing a new fund to support local TV news programming, which would be funded by existing financial resources within the broadcasting system. The proposal was included a paper released Tuesday, which will be used as a basis for discussion at an eight-day hearing on local and community television that begins Jan. 25. The commission said in the document that it "remains convinced that there is sufficient funding within the broadcasting system to ensure the creation of quality local programming, including local news coverage tailored to the particular characteristics of each market. However, meeting this objective may require a rebalancing of resources and responsibilities between the various elements of the system." The CRTC did acknowledge the financial challenges of producing local news. It said that between 2012 and 2015, the cost to produce local news in Canada is estimated to have exceeded revenues by 22 per cent. It added that the gap has been increasing, with costs rising about two per cent over that time and revenues declining by 10 per cent. It said the number of full-time job equivalents in local TV news declined by four per cent during those years. The commission said it is "interested" in discussing ideas for a new fund that "would allow for the redistribution of the resources currently in the system and earmarked for local expression, in order to allocate them according to the demonstrable needs of each platform and each market." It said such a fund should: be financed by resources already present within the broadcasting system; be managed by a third party separate from the CRTC and parties that support or benefit from such a fund; be based on a structure that is transparent, flexible and consistent with existing regulations; and be accountable to the CRTC and Canadians through public reports. The commission's working document said the upcoming hearing should consider what the "intended outcomes" of such a fund should be and potential incentives to ensure goals are met. It also said that funding eligibility would need to be established, as well as a way to determine each recipient's needs. The CRTC document did not say specifically how existing money should be reallocated to such a fund, though it did talk about a possible "rebalancing of resources and responsibilities between the various elements of the system." It identified three elements of the broadcasting system — public, private and community. The commission said Tuesday that it "is also open to any other proposal that would move towards a rebalancing both of the financing available to each of the broadcasting system’s elements and their responsibilities with a view to ensuring that Canadians in all markets receive a sufficient level of high-quality local news, information and other programming on the most appropriate platform. The Commission will place special emphasis on initiatives that seize opportunities offered by digital platforms for dissemination, discoverability and, where applicable, monetization." It said several submissions in the proceeding on local and community television have suggested a new fund to support local news. One of those came from BCE Inc., which proposed a fund that could "be accessed by local television stations that meet realistic minimum obligations relating to local news, thereby allowing stations to continue to provide such programming and creating an incentive to invest further.” Bell's intervention added that portions of existing contributions broadcast distributors are required to make toward different programming initiatives could be redirected toward a news fund. It proposed that some of the money come from reducing community-TV funding from cable and IPTV service providers to one per cent “of gross revenues from broadcasting activities,” which it said “represents a 50 per cent reduction for incumbent cable BDUs and a 33 per cent reduction for IPTV providers.” It also proposed that contributions to independent production funds, including the Canadian Media Fund, by IPTV providers be reduced by 0.5 per cent. Bell added that 0.8 per cent of all other contributions from cable or IPTV service providers to programming funds be redirected to the proposed news fund and 0.2 per cent be redirected to the Small Market Local Programming Fund (SMLPF). It noted that exempt cable and IPTV providers should undergo no change to their community-funding model, as these providers often operate in smaller markets where "community programming is more critical" and local over-the-air channels do not exist. Bell added that while satellite TV operators do not make contributions to community programming, they do contribute to independent production funds, and that 0.6 per cent of this money could be redirected to the news fund. It described its proposals as “a small re-direction that will have minimal impact on these funds.” A proposal to encourage community channels to create local news in areas where there are no over-the-air television channels was also included in the CRTC's proposals. It said it was willing to consider reducing the amount of community programming that must be allocated to access in instances where community-TV channels agree to produce local news. The commission added that allowing local advertising on community channels to support news programming might also be justifiable. CBC/Radio-Canada indicated in its submission to the CRTC that any reallocation of existing funds for local programming “should give priority to the production and broadcast of local news given the high level of importance placed on this content by Canadians.” In its intervention, Rogers Communications Inc. suggested that the CRTC "allow broadcasting ownership groups that operate a BDU” in major markets such as Vancouver, Toronto or French-speaking Montreal to reallocate revenues that are currently devoted to community programming in those markets to over-the-air TV stations and community channels that they operate in smaller markets. Rogers also proposed that the commission reduce the amount of programming community channels have to devote to access programming to 30 per cent, the percentage required before it increased to 50 per cent in September 2011. It said the reduction would give community channels more financial ability to produce local programming, particularly in places with no local over-the-air TV channels. It added that that requirement should only be reduced for broadcasting distributors that “commit to introducing alternative entry points to the Canadian broadcasting system for producers of access programming,” which could involve the use of online platforms, such as funding channels on Google Inc.’s YouTube. Shaw Communications Inc.’s intervention said that there should be no change to the contributions TV service providers make to local and community TV, adding that the “Commission noted that there is sufficient funding within the system to ensure the creation of locally relevant and reflective programming.” Shaw added that “greater flexibility that promotes innovation and efficiency is far superior to an approach based on new funding regimes that would stifle innovation and lead to inefficiencies.” It said broadcasters should be allowed increased flexibility “to develop local programming models that are appropriate for the digital age," and that partnerships between local TV stations and community TV channels be allowed. The commission said parties that have submitted interventions in this proceeding would have until Feb. 15 to make final submissions. The CRTC also said Tuesday it was opening an online discussion forum on community and local TV that would be open until the last day of the hearing on Feb. 3. — With reporting by Derek Abma at dabma@thewirereport.ca and Shruti Shekar at sshekar@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

CRTC proposes fund for local TV news

Broadcast | January 12, 2016

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CRTC proposes fund for local TV news

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