GATINEAU – The CRTC today called for comments on a Canadian Association of Broadcasters application submitted in July which predicts dire consequences for Canadian radio and TV broadcasters if they don’t get relief from certain regulatory requirements.
“March saw overall advertising revenue declines of 14.6% in private TV and 17.5% in radio, as advertising began plummeting mid-month; Private TV saw 46.4% advertising declines in April and 50.4% declines in May; Private radio saw declines of 65.5% in April, 67.3% in May and 56.9% in June; and pacing for the remainder of the summer projects revenue declines of 40-50% through August 2020, and significant ongoing declines through the Fall and 2021,” reads the CAB application, signed by board chair and Bell Media senior counsel, regulatory affairs, Lenore Gibson.
The industry says dozens, if not hundreds, of radio and TV stations could close.
While broadcasters are hopeful, and the ad market is showing small signs of recovery, “it can be expected that broadcasters may recover at different rates, depending on their individual circumstances and business models. For example, broadcasters who benefit from diverse and more stable revenue sources, or others that benefit from synergies and efficiencies, may recover at a different rate than those who do not,” reads the CRTC’s call for comments Thursday.
The CAB told the Commission in its application TV stations need relief from their 2020 and 2021 Canadian program expenditure (CPE) as well as programs of national interest (PNI) obligations because the impact of Covid-19 will leave them unable to meet them – nor will they be able to afford to make them up in the future.
It proposed to the Regulator due to the crisis and the dramatic drop in revenues the CRTC should simply deem broadcasters in compliance with their spending requirements until the crisis passes. The CAB also warns its members may not be able to meet exhibition requirements, too.
However, in its call for comments today, the Commission says it is unconvinced the CAB solution is the way to go. “The Commission is of the preliminary view that ‘deemed compliance’ for all broadcasters, as proposed by the CAB, may not be the appropriate approach,” it reads.
“The Commission considers that it may be more appropriate to adopt an approach, applicable to all broadcasters, whereby it would determine a broadcaster’s compliance with its regulatory obligations for the 2019-2020 broadcast year based on whether that broadcaster has fulfilled such obligations over a more protracted period of time. For example, financial requirements could be spread over several broadcast years to ensure that broadcasters have the flexibility they need, while ensuring that the broadcasting system benefits from broadcasters’ financial contributions as Canada’s creative industries ramp back up to full capacity.”
On the radio side, the association asked for the CRTC expedite local management agreements, where radio stations in a local market under different owners work together when it comes to local sales and operations. “We urge the Commission to suspend the radio LMA pre-approval requirement effective July 31, 2020, for a minimum of eighteen months,” says the application. Such approvals tend to take many months and some CAB members want to put together such deals now in order to gain efficiencies. That, however, will still mean layoffs.
The Commission’s call today said it will not consider LMA’s, instead leaving that to the review of its radio policy framework announced back in January.
The deadline to file interventions on this is October 19th. The deadline for the filing of replies is October 29th.
