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Called before the Standing Committee on Canadian Heritage, CRTC chair Konrad von Finckenstein said that implementing a fee-for-carriage for over-the-air TV stations is not the only solution for the lack of local TV programming, and the issue will not be discussed during the licence renewal hearing in April.
He explained, " 'fee-for-carriage (to be considered in non-metropolitan markets) may be part of an overall solution; we can"t put it in (on its own)." He added, " 'we need a comprehensive solution. The whole system has to be refined.' "
Von Finckenstein pointed out that during previous debates at CRTC Hearings, neither CanWest nor CTVglobemedia executives would commit any fee-for-carriage money to local TV programming.
The CRTC chair applauded the Local Programming Improvement Fund as one solution to increasing local programming. The fund is expected to provide $60 million to conventional stations in markets of less than a million people. One-third of the money will go to French-language markets and the rest will go to English-language ones. The fund is expected to get started this September.
Von Finckenstein said that the CRTC could also think about lowering local programming requirements in the short term and on an "exception basis" to help broadcasters during these tough economic times.
The CRTC chair and the vice-chair of broadcasting Michel Arpin both agreed that there needed to be a harmonization of local programming requirements. Some TV stations are required to air just four hours a week of local programming, while others must broadcast over 32 hours. Von Finckenstein explained, " 'we need to harmonize these regulations to ensure all (of them) have the same requirement.' "
The CRTC plans to investigate a proposal that for every dollar Canadian broadcasters spent on U.S. programming, they would have to spend a dollar on Canadian programming.
The chairman did acknowledge the financial pressures facing the conventional TV industry. He explained, " 'I don"t think anyone foresaw what"s happening (with conventional TV).' " He added, " 'conventional TV survives on ad revenue and the auto industry (a huge advertiser) is going bankrupt. The ad market is shrinking.' "
Another solution would be to allow Canadian pharmaceutical companies to advertise. Currently, there are strict limitations on pharmaceutical advertising.
Von Finckenstein also urged the federal government to make a deal with broadcasters on Part II licence fees. He suggested that the government stop collecting these fees, which broadcasters argue is an illegal tax, in exchange for the broadcasters relinquishing any claims for repayment of past contributions. Collectively, broadcasters hold around $200 million on their books in case the fees need to be paid. The issue of whether these fees are illegal is before the Supreme Court.
The chairman also suggested that some of the funds generated through the auction of analog spectrum could be given to broadcasters to help with the transition to digital.
Source: Cartt, 03/25/2009
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