CTVglobemedia says cable and satellite firms should have to pay for signals

THE CANADIAN PRESS
TORONTO - CTVglobemedia and CanWest Global Communications Corp. (TSX:CGS) are telling the CRTC that cable and satellite providers should have to pay local TV broadcasters for distribution of over-the-air signals in Canada.

The Canadian Radio-television and Telecommunications Commission announced in November that it was inviting comments on the possible introduction of compensation for the distribution of local TV signals.

"CTVglobemedia is seeking fairness and balance in the economic model for local television," the company said Friday in a release as it filed a brief to the CRTC along with CanWest Global.

"Compensation for carriage is essential if CTVglobemedia is to sustain the level of service it provides to local communities and its contribution under the Broadcasting Act."

CTVglobemedia, owner of the CTV network, operates 27 local TV stations from Halifax to Victoria. CanWest's large media holdings include the Global Television Network.

CTVglobemedia says local television "is in the midst of a crisis. Audience fragmentation and the rise of new media platforms are resulting in declining advertising revenues."

But cable and satellite firms take a much different view in their CRTC filings.

"A fee-for-carriage regime would have a serious negative impact on all sectors of the Canadian broadcasting system including consumers ... program producers and specialty and pay services," Gary Smith, president of BCE Inc.'s Bell ExpressVu, said in a release.

"In fact, the only beneficiary would be the big broadcasting corporations themselves."

In its brief, CTVglobemedia says compensation from cable and satellite providers should be linked to TV stations' provision of local programming.

It also argues that:

-Cable and satellite providers who wish to provide an out-of-market local TV station to subscribers allowing them to station-shift or time-shift should be required to obtain consent from the original broadcaster; and

-In markets where direct-to-home penetration has reached 30 per cent, the providers should be compelled to carry local TV stations.

"Conventional TV has passed the tipping point," said Paul Sparkes, executive vice-president of corporate affairs at CTVglobemedia. "Ad revenues are shrinking year after year and our expenses continue to rise.

"Right now, cable companies pay nothing for our signal, yet they charge their customers to watch local news and programming. It's just not right."

A recent study of cable and satellite TV subscribers shows that few know that none of the proceeds of their monthly bill directly supports local TV stations. The survey, released Thursday, was conducted by Nanos Research.

In addition to its conventional stations, CTVglobemedia holds interests in 35 specialty TV channels, including sports channel TSN. It also owns the Globe and Mail and CHUM Radio Network, which operates 35 radio stations throughout Canada.

Other CTVglobemedia investments include an interest in Maple Leaf Sports and Entertainment, which owns the Toronto Maple Leafs, Toronto Raptors and the Air Canada Centre; and an interest in Dome Productions, a supplier of mobile high-definition production services.

© The Canadian Press, 2008