MONTREAL – With Shaw and now Videotron having stopped payment on their monthly cheques to the Canadian Television Fund, the CTF board of directors said late Wednesday it has retained legal counsel and warned the TV production community of a problematic year.
As the largest TV distributor, Shaw (which also owns Star Choice) is the largest private contributor to the CTF while Videotron would be the fourth-largest. Together, their contributions make up almost half of the $150 million contributed by the industry each year to the $250 million fund. The rest comes from the federal government.
Numbers two and three in terms of size are Rogers and Bell ExpressVu. A Rogers spokesperson said the company would have nothing to say on the matter until next week, while Bell spokesman Paolo Pasquini said the company will honour its CTF obligations.
“We support the initiative that the fund is designed to do, and of course we remain very involved in insuring that it is maximized to the highest level and will continue to provide financial support as we have agreed to," he told Cartt.ca.
MSOs with over 20,000 subscribers all contribute to the fund.
“The CTF Board is seriously concerned about the devastating impact on Canadian television production resulting from the withdrawal of funds. The obligation to support the CTF is not discretionary and the CTF has the fiduciary responsibility to act,” said Douglas Barrett, CTF board chair, in a release.
Indeed, mid-sized and large cable and satellite companies are required under Broadcast Distribution Regulations to fork over a chunk of their annual gross revenues. The regs say:
Except as otherwise provided by a condition of its licence, if a Class 1 licensee had 20,000 or more subscribers on August 31 of the previous broadcast year and distributes its own community programming on the community channel, the licensee shall make, in each broadcast year, a contribution to Canadian programming not less than the greater of
(a) 5% of its gross revenues derived from broadcasting activities in the year, less any contribution to local expression made by the licenesee in that year, and
(b) 3% of its gross revenues derived from broadcasting activities in that year.
However, according to the wording of the regs, BDUs don’t necessarily have to pay by the month but can remit annually.
While CTF president Valerie Creighton told Cartt.ca earlier this week that it would make do without Shaw, which told the CTF in December it was suspending payment, for the time being the Videotron pullout has forced action.
The CTF is now conducting an immediate financial review to evaluate the full impact of Shaw and Quebecor’s withdrawal of financial support on the production applications for 2006-2007. It anticipates adjustments to its funding support for the 2006-07 fiscal year. In addition, such fiscal withdrawals will also make it impossible to plan for the upcoming year, says the release.
“The CTF is extremely troubled about the damaging effect on Canadian productions and the television production community: producers; directors; actors; writers; trades; in addition to the public’s ability to see Canadian storytelling on television,” added Creighton in today’s press release.
Over the past 10 years, the CTF says it has contributed $2.22 billion to support 4470 productions. "This has resulted in more than 23,141 hours of great television for Canadians, and has triggered more than 7.4 billion dollars in production volume across the country," says the release.
