WINNIPEG – Cable and satellite companies paying fees for the Global TV signal is just one of the major structural changes that must happen if conventional broadcast television is to endure, CanWest Global Communications CEO Leonard Asper said on Wednesday.
While the company’s fourth quarter press release made a vague, innocuous reference to “structural and regulatory” issues that need to be addressed, Asper was much more specific in his comments to financial analysts in a conference call late in the afternoon.
Referring to a “rigorous regulatory plan”, Asper said the company wants:
* Cable and satellite companies to pay broadcasters for their signals, like they do for specialty services.
* For ad time to be deregulated so that Canadian broadcasters aren’t limited to 12 minutes per hour.
* To be able to carry broadcast ads for prescription drugs.
* To put a stop to carriage on cable and satellite of distant signals.
* To potentially abandon its over-the-air transmitters.
Pointing to flat-to-2% growth rates in TV ad revenue, a lack of leverage when it comes to buying American programming – the cost of which is climbing by 10% annually – and the fact that local news programming, which can be expensive, is the responsibility of the conventional broadcaster, “it no longer makes sense that we are not paid for our signal,” he said.
Telling analysts that TSN gets $1.37 per subscriber per month for its signal and Rogers Sportsnet gets $0.78, it’s time broadcasters got something. Specialties have tens of millions in the bank before they sell even one minute of ad time. Broadcasters should see a similar revenue stream.
“We’ve got to address the fact that we’re not being compensated for all the programming we’re doing when we’re the ones bearing the brunt of the social policy for the government of Canada,” Asper continued, alluding to the Canadian content requirements broadcasters must adhere to.
Next in his sights were the restrictions on TV advertising. In Canada, specialty and broadcast channels are restricted to showing 12 minutes an hour of paid time and can not air prescription drug ads.
While some advertisers say they don’t want more ad time inventory – and many in the States say the 16 minutes an hour there amounts to significant ad clutter, “the fact is the American market works just fine in a deregulated market,” Asper said.
As well, “they have a $4 billion prescription drug advertising business there and we have no access to that even though you can watch those ads here on CNN.”
Moving on, Asper also addressed the distant signal issue where cable and satellite companies carry multiple CH and Global TV signals on digital as a negative for the industry.
“When (media buyer) Hugh Dow at M2 Universal says he’s buying Newfoundland to get Ontario – you can guess what he’s paying for Newfoundland,” he explained.
Finally, Asper addressed his network of towers, the numerous over-the-air transmitters the company operates to deliver its signal. “(Since) most people get TV via cable or satellite, the question is, do we need to operate transmitters any more?” he asked. “That’s a cost in the business we really can’t afford anymore, especially if we have to go digital, or high definition.
“It’s one thing to do high-def through fibre but it’s another thing to have to do high-def when you have transmitters. That’s a big, big expense difference.”
The one thing Asper didn’t address – because he has talked about these issues in prior years – was timing. Asper alluded to having a regulatory plan in place, but did not say when he might spring all this on the CRTC. (These calls let reporters listen, not ask questions.)
“We know the Commission has some sympathy but there’s incredible push-back from all the constituents,” Asper added.
“There is a battle coming.”
