Vice, Eastlink, Channel Zero and Bell offer new ideas to the CRTC Monday
GATINEAU – With major and independent broadcasters cutting newsrooms because of high costs and low revenue, there can be little doubt that local news and TV programming is in trouble. This means the industry may need to rethink how local programming is made and funded, the CRTC heard during the first day of an eight-day hearing on local and community TV. (pictured is a screen cap from CPAC.ca of Bell Media chief Mary Ann Turcke.)
Lee Bragg, chief executive at Bragg Communications (Eastlink) made some pointed comments about where he believes local TV should be heading. During an exchange with Candace Molnar, CRTC commissioner for Manitoba and Saskatchewan, he noted that community TV has an important role to play in local news and local expression and that saddling it with the same types of obligations as over the air TV isn’t the right approach, especially given the deteriorating business model traditional broadcasters face.
“It just seems like are we trying to recreate ourselves to be one of the other guys, which I think their business model is under strain, which I think everybody would acknowledge, and there has to be some adaptation,” he said. “If we had less mandatory funding and had to do it on our own, I think the challenge is we wouldn’t necessarily want to do it in the same way as everybody else was because I do believe that that structure is under a lot of stress and strain and I think it has change.”
While Eastlink says its customers love its programming and could continue under the existing models, Bragg said he believes local and community TV needs a broader rethink.
“It’s hard to look at it as a one-for-one trade-off when I think if we’re going to dramatically change the way we do things, I think we have to look at it more holistically and say what’s the right way to do it rather than just take incremental steps maybe down the wrong path,” argued Bragg. He added that if its regulated finding were cut, for example, the company would then have to do something it has never had to do: calculate whether deeper corporate investment in community programming is the best way to invest capital to serve its customers, versus investing that money in faster networks or building a broader wireless footprint.
A new way of providing local news and programming is what Vice is about. The upstart digital provider which got its start as an edgy print publication in Montreal, has helped usher in a new way of presenting news and information for and by millennials. During its testimony, company representatives noted that doing things the traditional way may appeal to a certain segment of the population but not to the millennial viewer.
“When we cover a story it’s in a very specific way. We want people reporting stories to have a strong opinions, we want the language to be unfiltered and unfettered, we want it to be engaging, sometimes shocking, provocative and we also don’t want to be shackled by the format,” explained David Purdy, chief international growth officer at Vice
The outfit, which has to date been strictly a digital play which also licensed content to some broadcasters, will soon break into linear in the U.S. and Canada with new specialty channels. While the goal is to expand the number of advertisers, Purdy stressed that just because it’s on the dial doesn’t mean it will act just like a traditional network. Commercial breaks, sponsorships and ad loads will differ from the conventional TV channels.
“We think millennials have a much lower tolerance for that type of ad load, and so we’re going to try and experiment.” – David Purdy, Vice
“We think millennials have a much lower tolerance for that type of ad load, and so we’re going to try and experiment with lower ad loads, different formats, not breaking up the content as much because we believe our audiences are used to binge viewing and watching content (in a way that is) a little more respectful of their time,” said Purdy. Millennials’ tolerance for “bovine fecal matter” is equally low and “they know when they’re being played with or manipulated,” he added.
During the intervention stage a number of proposals were raised as potential options to fixing the local TV dilemma. Channel Zero, which itself has had to restructure its local programming operations at CHCH in December, believed that options from Bell Canada and Groupe V Media could be workable short-term solutions. Longer-term, it said that there is an opportunity to rebalance the system by adopting a different approach.
In essence, the existing 2% of BDU gross revenue going towards local programming would remain the same, but 
would be shared differently among cable community channels and the OTA broadcasters. In communities where there isn’t an OTA, the community TV channel would get the funding and advertising restrictions would be eliminated. In addition, OTA and community TV would collaborate on local programming under the Channel Zero model.
The hearing’s first day also saw Bell Canada lay out its ideas. The vertically integrated company reiterated its position that a new funding approach for local TV is critical for its survival. It has proposed a local news fund (LNF) that would help incent broadcasters to do more news. Some of the money for this new fund would be taken from community TV funding.
“Our proposal is a genuine attempt to meet the needs of both local and community television because both are important to the ecosystem. Within the constraints of a finite pool of existing resources, our proposal creates incentives to invest in local news while ensuring that community TV remains sufficiently well-resourced,” said Mary Ann Turcke, president of Bell Media.
Under questioning, Commissioner Molnar took Bell to task over its LNF proposal. During an exchange with senior executives, Bell said would not actually produce any more news that it already is doing if its plan was adopted by the CRTC.
At one point, Robert Malcolmson, senior VP of regulatory affairs at BCE, noted that the plan was about incenting broadcasters to invest in news programming. “What we’re trying to do is look at the system, how many hours in small, mid, large markets would be appropriate to serve the market and how do we create incentives for people to do that amount of local news and then have an opportunity to access some funding to help them do more,” he said.
“If nothing is done in this country, it worries us that we will wake up in three years and even the biggest news providers… aren’t there anymore.” – Mary Ann Turcke, Bell Media
Molnar wondered a few minutes later if under its own proposal that Bell would be producing more news.
Turcke replied that the proposal was about ensuring others do more, but not Bell.
“We want to create an environment where more people engage in the news in this country, not necessarily that the two biggest news providers by a mile do more. We need more voices in the country. What we’re saying is if nothing is done in this country, it worries us that we will wake up in three years and even the biggest news providers, where we are the only voice in 12 markets… aren’t there anymore.”
But isn’t it logical to expect that Bell would produce more news under its own proposal, Molnar pressed Bell.
“The objective for the system, the entire news system, is to create more news. We have not over the last three, four, five years reduced our news programming where many others have,” said Turcke, who also added that all but five of its local stations lose money.
The hearing continues tomorrow with Groupe V Media, CACTUS and PIAC among the witnesses.
