Broadcasters need more speed from the Commission
By Steve Faguy
“I REALIZE WE HAVE the right to transmit over what they consider a public resource — the limited bandwidth that’s out there,” says Rod Schween, president of the Jim Pattison Broadcast Group. “I’m not saying that we need no regulation, but as much as they want us to innovate, they have to realize that the regulations need to allow us to innovate.”
Though they may disagree on the specifics, most Canadian radio broadcasters Cartt.ca spoke to through this series, and those who filed submissions with the CRTC as part of its review of commercial radio policy, agree in general the Commission could do much to reduce the regulatory burden.
For small broadcasters, like Torres Media, which operates Dawg FM in Ottawa and three other radio stations in Ontario and Quebec, the CRTC’s paperwork takes a lot of human resources and could be simplified without affecting the end result at all. “Annual reporting for four radio stations takes the full attention of two of our most senior executives, our president and CFO, for 10 days,” CEO Edward Torres writes in his submission to the proceeding. “In some cases, address information needs to be populated into different forms many times. The forms are not intuitive and must be filled in, managed, and filed even though the information on the form is the same as that from the previous year.”
And even when everything is done correctly, Torres writes, “forms are frequently misplaced at the Commission” resulting in apparent non-compliance. And all this for forms whose contents are often virtually identical to the previous year, except for financial results.
“Annual reporting could easily be achieved with a single form that has a box that simply confirms that all other information is as on file with the Commission,” Torres writes.
Other broadcasters large and small say that as much as quotas and rules add to their workload, it’s the paperwork that comes along with it that creates frustration. Plus, it’s not just a burden on the broadcasters, but it gums up the works at the Commission as well.
“As the regulations and associated reporting and application process demands continue to stack up, Commission staff is falling behind on processing applications and issuing decisions.” – Rogers Communications
“As the regulations and associated reporting and application process demands continue to stack up, Commission staff is falling behind on processing applications and issuing decisions,” Rogers writes in its submission. “Simple technical amendment applications submitted by Rogers which took approximately one month to process in 2016-17 now take five to six months unless we request an expedited proceeding due to unmovable deadlines (such as site evictions).”
Jon Pole, president of My Broadcasting Corporation, tells Cartt.ca he had similar frustrations “just in the mechanics of the day-to-day” with the Commission. “The last time we applied for a radio station, it took three years,” he says.
Schween notes an application to buy a radio station in Merritt, B.C., took nine months to get approved, in part because it had common ownership policy considerations. But “there was no one else lining up to buy that station,” he says, frustratedly. “The owner was 72. She wanted to retire.”
This very review is an example of the slow pace of the Commission. A review of French-language music quotas was originally scheduled in 2015, but was delayed because of a lack of francophone commissioners. It is only finally being reviewed now for the first time in 15 years.
“It’s likely we won’t get a decision on this radio review for 12 to 18 months, and I worry about how many radio stations are not going to be able to survive under the current regulatory regime for 12-18 months,” Schween says. “How far does our industry get left behind because the regulatory world that we live in can’t change quick enough to allow us to be innovative enough to change with the unregulated world that we compete with?”
“It’s likely we won’t get a decision on this radio review for 12 to 18 months, and I worry about how many radio stations are not going to be able to survive under the current regulatory regime for 12-18 months.” – Rod Schween, Pattison Broadcasting
While the Commission can take its time making decisions, postponing hearings and issuing short-term administrative licence renewals while it reviews stations’ licences, broadcasters also say some of their deadlines are too short. One of the most common compliance issues is failure to file annual reports by the Nov. 30 deadline, three months after the end of the broadcast year.
Leclerc Communication, which owns three radio stations in Quebec, says the deadline is too tight to get audited financial statements done. “The quantity of information and documents requested, and the questions asked by accounting firms to allow them to produce an audit report, are extremely large compared to what is required to produce a review engagement report.”
It suggests extending the deadline to 120 days, or Dec. 31, consistent with deadlines set by financial institutions for audited statements.
Other administrative hurdles come under criticism from broadcasters in their submissions. The need to get CRTC approval before switching between talk and music formats, or between mainstream and specialty music formats, came up several times. Rogers calls the limitations “outdated and inequitable restrictions that hinder our ability to operate competitive, profitable stations.”
Most broadcasters agree such limitations should only be required for stations which promised a specialty format as part of a competitive licensing process.
Requirements relating to logs and recordings (still called “logger tapes” even though no one uses tape anymore) also add administrative burden, they say. The Canadian Association of Broadcasters proposes an alternative spot audit system based on artificial intelligence, and using a complaint-based system to “help direct the Commission’s compliance resources to where they are most effective.”
Another major administrative hurdle concerns Canadian content development contributions. Generally, broadcasters are allowed to direct some of their contributions from new licenses or tangible benefits commitments toward discretionary initiatives, but must justify each expense to the commission to see if it qualifies. Because this creates headaches for both sides, the Commission floated the idea of eliminating that option completely and just redirecting contributions to established funds like Factor and Musicaction.
Broadcasters don’t like that idea. While SiriusXM calls the reporting requirement “excessive regulation,” it comes out strongly against eliminating that type of spending.
“Our discretionary CCD expenditures have proven to be far more effective and considerably more impactful for Canadian musical and spoken-word talent than merely contributing to one of the designated funds,” general counsel Oliver Jaakkola writes in its submission, which is supported by several recipients of discretionary funding asking the commission not to take it away. Instead, Jaakkola writes, the CRTC should “adopt a more pragmatic approach to assessing discretionary initiatives.”
“There’s still a policy direction to come from the minister’s office to the CRTC.” – Kevin Desjardins, CAB
Leclerc notes in its submission broadcasters always have the choice to either accept the administrative burden or just give the money to the established fund of their choice.
Of course, all this discussion has to tiptoe around Bill C-10, the government’s reform of the Broadcasting Act, which could radically change the regulatory environment to which we’re currently discussing tweaks. On top of that, “there’s still a policy direction to come from the minister’s office to the CRTC,” notes Kevin Desjardins, president of the CAB. But until it’s signed into law, the CRTC can’t act on it.
It’s a frustrating position for the Commission that at least some broadcasters understand.
“I probably sound very critical and I don’t mean to,” Schween says. “Because you know what? My job is tough sometimes, but I think an even tougher job would be to be somebody in government or to sit on the Commission because I know while I’ve got all these wants, there’s going to be other stakeholder groups that want different things, and they have the impossible job of trying to make everybody happy, and they’re never going to be able to do that.”
Editor’s note: This was the final of a 10-part(!) series on the future of radio in Canada and Steve Faguy did an excellent job, if we do say so ourselves (the first nine parts are below). In-depth coverage and analysis like this can’t happen without your paid subscriptions to Cartt.ca and so we thank you. If you want to see us dig deep into another topic, please let us know at editorial@cartt.ca.
