I'm Mad as Hell

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and I can't do a thing about it

Canada’s Own Evil Empire?

Most of the blogs I write are born in a news story or an event that grabs my interest and all but twists my arm forcing me to write something about it. This one is different. This blog is the result of an accumulation of upset that has taken years to come to terms with. I ask you, anyone who reads this column, is there a huge corporation in Canada that is more anti-consumer than Rogers?

Let me start with the easy stuff. Rogers brought the mobile phone industry to Canada, does anyone remember Cantel? They created a mobile telephone system that was ludicrously expensive and then created fictitious fees to gouge their customers even more, fees that we are still paying, for services that do not exist and never have. Sure Bell and Telus came along afterwards and jumped on board to overcharge Canadian consumers, but it was Rogers that created the pricing policies that make this country one of the most expensive in the world to own and operate a cell phone.

Canada was a leader in creating cable television. We were the first country in the world to use this system for disseminating TV signals. Many Canadians have a short memory about this industry. In fact Rogers bought into the industry, they had little to do with creating it. What Rogers added was higher prices and the inability to chose the stations you wanted. They bundled services so that if you want The Movie Channel, you have to buy a whole whack of stations you may not have any interest in. Worse, if you want Turner Classic Movies, you have to pay the big bucks for The Movie Channel to get it. It’s been close to two years since they promised the CRTC that they would give the consumer the choice to pay for only the stations they want, yet nothing has happened. The Rogers people gift to Canadians: little choice, higher prices and if I may add here, long telephone waits and poor service.

I will only mention Rogers internet service in passing. Canadians pay way too much for internet service, again, amongst the highest in the world. And, if that’s not enough Rogers has added insult to injury by using throttling to slow their service when it gets busy. You pay for fast service, but Rogers slows it down on purpose. While U.S. companies race to install fibre optic wire to help make their service better and quicker, Rogers uses old fashioned coaxial cable that in many cases is as much as forty years old. They claim the high prices are to increase bandwidth and new technology…where do we, the consumers, see the results of that money?

Don’t get me started on their television services. In a previous blog, The Rape of CITY-TV, I discussed how Rogers ruined one of the most unique and innovative television franchises anywhere. When was the last time anyone noticed CITY-TV? They also own Rogers Sportsnet. This started as a regional sports network with four channels, each aimed at a different part of the country. Then the tricky bastards at Rogers added Sportsnet One, put a lot of the most watched content on the new station exclusively and made us pay more to see the channel. Rogers also owns Omni, the multicultural channels with bases in Montreal, Toronto and Vancouver.
What did they do with those licenses? First they got rid of most of the multicultural content and replaced it with cheap U.S. game shows and sit-com reruns. They do news in Italian, Chinese and Hindi and run some movies in those languages but they produce very little else. What you may not know is that when you see a Russian show, an Arabic show or any other minority show, the minorities buy the time from Rogers and then have to find their own advertising dollars to pay for their work and what they owe Rogers for the airtime. Many actually lose money to provide their poor communities with a service while Rogers makes millions off them and billions in total.

Rogers also owns the Toronto Blue Jays. They should be embarrassed by their involvement. They have managed to turn the largest market for any single baseball team, 33 million in Canada and 5.5 million in the Toronto area into what they call a small market. Year after year they have underfunded the Jays, in fact the Jays’ budgets are the same today, about $60 million U.S., as when Rogers bought the team. What that doesn’t take into consideration is that the Canadian dollar was at 65 cents when they took over and is close to par today. That means they are actually spending 30% less today then they spent when they bought the team. No need to ask why the Jays have never gone to the post-season under Rogers’ ownership, the answer is all too obvious.

Now Rogers wants a piece of the Toronto Maple Leafs, Toronto Raptors, TFC, etc. Here they see an opportunity to parlay ownership of the teams into television content for their channels. If past performance is any example of future performance, don’t plan for any parades on Yonge Street…ever.

Over the decades Rogers has set the example of greed and gouging that has been seen and followed by the folks at Bell, Shaw, Telus and the rest. They could have been leaders in customer service, competitive pricing, quality television and performance excellence. They never chose those routes. All they have ever shown an interest in was maximizing their bottom line at the expense of their customers.

Who do I blame? Ted Rogers of course, but I also blame the CRTC and the Canadian government for allowing them to get away with the worst of their actions. How could the CRTC allow them to create phony charges for cell phone service? How could the CRTC have allowed prices to grow out of all proportion to other countries? How could the CRTC change their own rules to allow cable companies to own television stations? How indeed?

The people who ran and run Rogers should be ashamed of what they have wrought. The CRTC should be ashamed of what they have allowed to pass. Finally, successive governments of Canada, both Liberal and Conservative should be ashamed of standing by while the CRTC allowed Rogers to gouge the Canadian public.

I invite anyone from Rogers who wants to rebut anything to contact me. I will make space available to them to explain their side. I’m sure all Canadians would like to hear any explanation from Rogers.

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Monopoly…a Canadian way of doing business

A lot of you will look at the deal to buy Maple Leaf Sports and Entertainment (MLSE) by Bell and Rogers as simply a sports deal. You may be questioning what this means for the future of your favorite sports franchise, be it the Toronto Maple Leafs, the Toronto Raptors, TFC (the soccer team), maybe even the Toronto Blue Jays or one of the other six NHL teams in Canada. If you are a sports fan in this country and whether you love the dismal Toronto franchises, or love to see them fail year after year, there are real sporting implications…the truth though, whether you like to hear it or not, is that the future of the Leafs success on ice is mostly irrelevant in this deal.

The sale of MLSE is about content rights, who will control the television, radio, internet, mobile, etc. rights to the sporting content generated by these teams. In those terms this is a very frightening deal. Bell and Rogers are already the two most powerful media conglomerates in Canada. They own and manage, some would say mismanage, 80 television stations including all of the major sports stations on TV. They own 88 radio stations including all of the major sports-talk stations. They will pick up an additional three television licenses that MLSE owns. Together they own the vast majority of Canada’s online and mobile services. You think that it’s just Bell and Rogers? Think again. They also own Virgin, Solo, ChatR and Fido, and of course the largest satellite and cable companies too.

It’s hard to believe that a few short years ago it was deemed illegal for a cable or satellite company to own a television station, let alone a network. Thank you CRTC.

This concentration of power will be bad for everyone. While Bell and Rogers are busy divvying up the nation, they leave little room for their competition. This means they can do with sports content what they have done with mobile technology and cable and satellite delivery. They can control access and they can control price. All you have to do to see the future is to look at what these to companies have done in the past. Canadians pay among the highest rates in the world for mobile service and internet access, and Bell and Rogers continually strive to keep competition out through influence on government and regulatory bodies and with unfair discount practices that disappear when the competition is wiped out. To quote Ellen Roseman in the Toronto Star, “Rogers and Bell bludgeon customers into accepting a flurry of extra charges for wireless phones. They hit them with unexpected bills for data roaming and third party text messages.”

Roseman goes to describe some of the dirty practices of Bell and Rogers that include discounts that evaporate before the subscriber ever sees them, raised prices that make the discounts offered moot, and of course, some 8000 complaints from Canadians to the government last year about how they are being treated by telecommunications companies like Bell and Rogers.

I expect to see access to Toronto’s sports franchises on radio and television to change in three ways, first, you will see far more games on Rogers Sportsnet and TSN and expect to see fewer games in which let’s say the Calgary Flames or Winnipeg Jets own the rights. Why pay the owners of a third party NHL club when you can pay yourself and fill the same amount of air time? Second, I see fewer opportunities for non-MLSE affiliated channels like CBC and Global to get the rights to the most popular sports entertainment. Finally, I see the possibility of a new pay channel that replaces Leafs-TV and Raptors-TV with a new sports channel that forces the public to pay big subscription fees to gain access to games that will no longer be available on any other channel, think MSG Network (Madison Square Gardens) or YES Network (Yankee Entertainment) two very profitable networks in the United States that control all of the most popular sports franchises in the New York City area.

Lastly I want to make a point about the way sports journalism will be affected. Since the owners of MLSE will now control virtually all of the sports broadcast media who will be left to criticize the missteps and worse the arrogance of this new sporting monster?

Will the guys at The Fan or TSN Radio take on their corporate bosses? Will they lose jobs and be punished for doing so? Does anyone see the conflict of interest here? Does anyone at the competition bureau or the CRTC care?

In the past few months Rogers and Bell have been busy buying the services of dozens of the best print sports writers to fill slots on radio and television and to write for new magazines. Most have quit their print jobs like Stephen Brunt, some like Damien Cox keep a foot in both camps. It is my contention that just about every sports writer in Canada is at least partially beholden to either Bell or Rogers. Sure you may write for a local paper in Vancouver that’s owned by the Post group or an independent in Toronto like the Toronto Star, but you all supplement your income, your reach and your popularity with appearances on one of the Bell or Rogers sports television and radio channels. Do you want to blow your chances for more guest shots? I think not. So, when the Toronto Raptors decide to spend less money and refuse to sign a free agent that’s available and who might make the team competitive, or merely watchable, will you write about it or just keep it to yourself? When TFC charges more for tickets than Manchester United (this is already a fact) will you shout about it in your column or is discretion a better road to take? For those of you who haven’t seen it, The Globe and Mail, which should stop calling itself Canada’s national newspaper, barely noticed this story. Why?

Sports journalism is for the most part an oxymoron in Canada. The last bastions were the daily newspapers in the major cities. Bell and Rogers have figured out how to co-opt even this small amount of opposition. Now it can only get worse.

Canadians in general and sports fans in particular will be the big losers if this deal is allowed to go through. The only way to stop it is if all Canadians get up of their backsides and scream at their political representatives. There’s one thing more powerful than the money and influence Bell and Rogers can and do wield, that is the threat of losing the next election.

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The CRTC Must Die

Every time you think the Canadian Radio-television and Telecommunications Commission, the CRTC, has finally been chastised and in the process, learned a lesson, the bozos who run the circus come up with a new and silly act meant to help the broadcasters. And, as is usual with these folks, somehow ends up diminishing our choices as consumers and costing us more money in the long run.

Last time the genius’ at the CRTC had the brilliant notion that behemoths Rogers and Bell should have the right to tell their sub-buyers like Teksavvy what they could charge for internet use. This blew up in the CRTC’s face when most Canadians saw through the money grab by the big providers and began a protest that made the suggestion disappear faster than a Liberal leader in the 21st century.

At just about the same time the sages who run the CRTC suggested that the need to tell the truth by broadcasters should be somehow loosened so that less honesty and less truth could become the norm. This was at a time when Sun TV was on the drawing board. Either they, the CRTC, were too stupid to make the connection, which is highly likely, or they were attempting, as some suggested, to pander to the Tory government by making it easier for a Fox-north like entity to succeed. Either way, it blew up in their collective faces.

Oh, and let’s not forget the plan to allow CTV and Global to charge cable and satellite companies to rebroadcast what is by license and by law a free service. Somehow this notion was approved but has disappeared from the landscape. It was left to the broadcasters and the distributors to somehow work out the charges. My guess is that Rogers said no way, we won’t pay and the entire issue went poof. If it had any legs after that I suspect the acquisition of CTV by Bell and Global by Shaw doomed the concept. Now the broadcasters are the distributors too. Funny the CRTC didn’t see these events coming even after they broke their own rules years ago by allowing cable and satellite companies like Rogers and Bell to own TV stations. It was inevitable. Only the egg-heads at the CRTC didn’t see the end of competition coming.

So, now that all their recent plotting has failed miserably, the brainiacs at the CRTC have come up with a new plan to strengthen the oligarchies that run broadcasting in Canada while at the same time diminishing the viewers’ options. This time the CRTC is asking interested parties, there will be no public hearings so interested parties mean those who are stakeholders, the people who will make more money, to comment on how new media should and could be forced to provide Canadian content and contribute to those people who provide Canadian content.

On the surface this sounds so sensible. Who’s against more money for Canadian shows and who wouldn’t like to see more and better Canadian TV? Apple pie and ice cream right?

Wrong! When looked at more closely the CRTC is attempting to regulate an industry that it has no right to regulate. Sure I can see why CTV, Rogers and Global want to make it more expensive for Netflix and Apple to do business. If Netflix has to charge more for their service, there is less likelihood that my fellow Canadians will sign up. In the end this means more customers for the broadcasters and distributors. Why not ask? I would if I owned CTV or Global.

Instead of looking at the apple pie and drooling, think of it this way: Netflix and Apple are really no different than your local video store. They provide access to content that is not delivered by cable, satellite or over the air. Their content, like the video store is mostly TV series’ and movies, the stuff you can buy at Walmart or rent at Blockbuster. Interestingly, Rogers provides this rental service in big video stores and Bell and Rogers both offer pay-per-view movies. Ask yourself whether Blockbuster or your corner video store should be forced to provide Canadian content or help pay for Canadian production? Obviously, this is a ludicrous idea. Well the concept is no more ludicrous at the Netflix store.

The latest argument by the broadcasters is that Apple and Netflix have begun to fund and buy programming that will go directly to their service and bypass TV, cable and satellite. Please, someone, explain what the difference is between this and videos that are made to be sold directly to the public without ever being broadcast? There are thousands of them. Disney is a big producer of this sort of content. Perhaps we should go after Disney to provide Canadian content and money for Canadian production. Hell, you can buy the Disney videos in Canadian stores. It’ll never happen. I can hear the guffaws coming from the Magic Kingdom just at the suggestion.

Seriously folks, I think we can all recognize a protectionist scam that is being devised by the broadcasters in Canada along with the CRTC. Hurt the new guys and you help yourself. Luckily the Tory government has already come out against the idea. Tony Clement has said, “…it is a way to strangle the competition.”

The time has come to scrap the CRTC. They are tools of the oligarchs who own and run broadcasting and telecommunications in this country. They have succeeded in providing Canadians with one of the most expensive mobile phone systems in the world, one of the highest cost internet systems in the world, and a national television system that is ruled by three owners who have steadfastly fought every initiative to make Canadian programs and play them in prime time. All they, the networks, really care about is their bottom line. Fair enough, they are businesses. But isn’t that why we created the CRTC? To regulate those businesses so that they serve Canadians. So far all I see is a CRTC that wants to regulate Canadians in the service of Rogers, Bell and Shaw.

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Lie to Me…the CRTC says it’s okay

Anyone who has paid any attention to the rulings, musings and operations of the Canadian Radio Television and Telecommunications Commission can be excused if they are confused and amazed. Every time I think the CRTC can’t get any worse, they confound me and most fellow Canadians with something crazier than they have ever considered before.

Believe it or not the CRTC has chosen this time to suggest a loosening of the rules that demand truth and accuracy in radio and television news. I know, I know, the first question is why the heck would anyone want less truth and less accuracy? Especially in the days of Fox News and all the havoc that they have wreaked on the American public.

Stacey Hannem Assistant Professor, Criminology Laurier Brantford wrote this in the Brantford Expositor:

The CRTC is currently in the process of proposing changes to its regulations for news media which prohibit the publication of “false and misleading” statements in the guise of “news.”
Under the proposed changes, media outlets would be prohibited from broadcasting statements that they know are false and misleading statements only if said statement also “endangers or is likely to endanger the lives, health or safety of the public.”
Let’s get this straight. This means that the CRTC is willing to allow media outlets to broadcast known falsehoods as news; that is, opinion, slander, and outright lies, as long as they think it won’t hurt anyone.
I ask you, how do they know which lies will be harmful? Can they predict which lies will cause unnecessary stigma, divisiveness in communities or between ethnic groups? Can they predict which lies will cause unnecessary fear among the public? Can they predict which lies will cause Canadians to vote in ways that they might not otherwise and completely change the political and social trajectory of our nation?
How can they define or predict the harm that will be caused by the publication of lies as news?

So far as I know, nobody, no organization has publicly asked for these changes. It is possible that some broadcasters have secretly demanded the right to be less than honest in their reporting, but I am sure they would never make this request publicly. Why? Simple, because then we would all know or be free to conclude that the broadcaster that requested the changes was willing to lie or bend the truth and the result being that the broadcaster would lose all credibility and hopefully all their viewers or listeners.

So I ask again why? Without any obvious explanation one has to wonder about the fact that the new right wing talk and all-news station is about to hit the airwaves this year. Will the new rules allow them to emulate Fox and publish inaccurate stories? Fox is still questioning President Obama’s birthplace even though the facts have been clear for more than two years. Is this unfair to the new television station? Perhaps it is, but pundits and analysts are scratching their heads trying to figure out where this came from and they are looking for the obvious when no other explanation is forthcoming from the CRTC. One Toronto Star letter writer put it this way:

It is bad enough that the CRTC is allowing a politicized Fox-like station to mount its operations in Canada, a country so admired for its standards of truthfulness and values that should not be undermined.

We are the country that should be emulated, not lowered to the standards of others. It is worrisome that the CRTC would contemplate watering down the requirement of broadcasters to air factual – not misleading information.

Janet Denton, London Ont.

Janet gets it even if the CRTC does not. But that’s not all the CRTC has been up to. Konrad Von Finckenstein’s mates have decided that Bell and Rogers are not making enough money from their internet services. Hey I know we all feel sorry for the poor sods at Bell and Rogers. It’s tough to keep squeezing more billions from consumers when there are so few new services they can offer.

So Bell and Rogers, I presume, got together with Konrad and his pals at the CRTC and came up with a great plan. Let’s allow the big internet providers to charge based on usage. We’ll call it “usage based-billing” and we will let Bell, Rogers and Telus force it down the throats of all their customers, especially the small ISPs (Internet Service Providers) who buy access for their service from the big boys. We’re not talking about small changes either. One company, Tekksavvy, which allowed its customers to use 200 gigabytes per month has advised its users that they will only be allowed 25 gigabytes from now on. That’s 1/8th for the same price. Where does that leave their customers? Canadian internet subscribers will be paying more for less in the future. That means any small company, hey, any large company, that depends on or uses the internet will have its costs driven up substantially. Guess who will end up paying for that in the end? Too easy. Us. The consumers.

Here we are in a country that already sees us paying way more than our competitors in the U.S. for mobile phone services and the internet and what does the CRTC do? Allow the corporate giants who are already making huge profits to gouge us for even more.

Peri Maric of Vancouver said all that has to be said in a letter to The Globe and Mail:

It’s a repugnant corporate money grab, sanctioned by the federal government, directly aimed at exploiting…our citizens, the most active national internet community in the world.

The mandate of the CRTC, I checked their website, clearly states that they are supposed to “serve the Canadian public.” It also says, “the CRTC works to serve the needs and interests of citizens…” Yeah right. When does that start happening?

Maybe the time has come to reform the CRTC or completely replace it with an agency charged with the primary responsibility of protecting consumers. The telephone companies and the cable companies already share very close to a national monopoly on all forms of communications and they are expanding their holdings with the help of the CRTC. Their power needs to checked not enhanced by the federal government.

Filed under: Media Commentary, Political Commentary, , , , , , ,

Fox North

The media is buzzing. The newspapers are writing stories every day. TV commenters are filling the blogs and web sites with gloom and doom. University teachers are being called for their take on the impending story and op-ed pieces are being penned by learned experts. I’m sure the editorial writers across the land are sharpening their pencils in readiness for the big announcements. And what’s all the fuss about? It seems that Quebecor is about to attempt to launch a right-wing news and talk television service that has already been dubbed “Fox North” by the naysayers.

As far as the Canadian media are concerned, and you can count me among them, Fox News is the antichrist of TV networks. I have no problem with their conservative viewpoint. But I object strongly to their lack of honesty and their continued and unfettered spreading of false and unsubstantiated facts that are the lifeblood of the service they provide. Call me old fashioned but I still believe the number one rule of journalism is that you get the facts right. You can comment and spin all you want but you can’t publish false or unprovable information. Fox News and its band of crazies led by Bill O’Reilly and Glenn Beck are guilty on all these counts.

Still, is there really good reason for Canadian media to react the way it has? I guess I’m not ready to get upset just yet. First and foremost there is a huge hurdle that the new network has to climb. They are asking for “must carry” status from the CRTC. That would mean that all cable and satellite companies would have to find a prominent place for the new service on their dial and that all Canadians who subscribe to cable or satellite would have to pay a monthly fee for the channel whether we want it or not. In order to get “must carry” Quebecor would have to prove that they are a necessary and missing piece of the broadcast fabric that exists in Canada today. That’s a stretch. With three English all news networks already out there they would first have to prove that the others, CBC NN, CTV News Network and CP24 are either totally biased and blind to conservative views, or that a conservative viewpoint is missing from our TV choices and that being conservative is enough reason to make it essential. That’s a real problem even in Stephen Harper’s Ottawa. I don’t believe they will get “must carry”. Then what?

That will mean they will have to do deals with all the cable and satellite companies to find space. Then they will have to depend on Canadians’ willingness to ante up for the new channel. It will become our choice as viewers as to whether we want to buy another all-news and talk channel. That could be a tough sell with the costs of cable and satellite rising and most Canadians looking to pare down their media choices.

It is important to note that the existing news, talk and current affairs channels in Canada are not exactly catching on with the viewing public. CBC NN and CTV News Network have so few viewers that I suspect it would be cheaper to put their content on DVD and deliver it to the 25,000 or so folks who tune in. CP24 is one of a handful of stations that people watch but don’t listen to. Whenever I see the channel in offices, gyms, bars, the sound is turned off. It is a weather and time channel. CPAC, has anyone watched this channel lately, actually gets the same size audience as CBC NN for most of the day. Documentary Channel should do better but it remains an afterthought for viewers.

So why does Quebecor think another all news and talk station is a good idea? I suppose it is the fact that all the other news and talk stations are doing so poorly. They must believe that there is actually a void, as far as viewers are concerned, in the market. That void would have to be engaging television. The truth is that unless there is a big story breaking there is no reason to watch all-news TV. Worse, if a big story breaks anywhere outside Canada, the home grown networks can’t compete with CNN. So what will make us tune in to “Fox North”? The people at Quebecor think that strong right wing views and personalities will cause the kind of stir that will attract a large enough audience to make the station the kind of hit that Fox News has been in the U.S.

So far very few right wing media organizations have succeeded in Canada. The National Post can barely give their newspaper away. Alberta Report faded away. Sun Newspapers (owned by Quebecor) have been losing money and laying off staff for two years. So where is the market? It might be the talk radio crowd. They seem to gravitate to the wild right but every poll of their listeners has shown them to be older, lower income and lower educated. Not the crowd that the advertisers are looking for.

The bottom line for me is that the Canadians I know, even the very conservative ones, tend to be more moderate in their ideas and their expectations. In the land of “sorry” I am not sure that media crazies will be a welcome addition. Quebecor’s track record for picking winners in English Canada is a poor one. I expect we are getting our shorts in a knot prematurely.

In the meantime I welcome any organization that can create new jobs for journalist and TV producers and I even welcome the addition of an opposing point of view. I wish the Quebecor people good luck and hope they can deliver a strong but fair conservative view to Canadians. If the rumors are correct they have already helped the CBC by stealing perennial screw up reporter Krista Erickson. I guess she will now be free to date Tory MPs and maybe take a few free flights at the taxpayers’ expense.

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Code Beige at the CRTC

I guess it was to be expected. The CRTC took many months and countless opinions and distilled the results into a watery half decision that will satisfy no one and resolve little.

I don’t know if the commission is still gunshy from its poor decisions to allow the cable companies to rape and pillage Canadians in the past. I am not sure whether the terrible rulings in the past that allowed Canadian broadcasters to undermine content rules and kill local television make the current CRTC fearful of their own decision making ability. Maybe they are afraid of a government that stomped on their last mobile telephone decision. Whatever the case, the current ruling that the networks can claim money from the cable and satellite companies for what are by license free over the air services will lead to no easy resolution of the ongoing battle. Why? because the ruling was half-hearted at best.

Typical of today’s CRTC they have said it was okay to charge for network signals, unless you are the CBC, but they want the two warring sides to work out a fee schedule. Are those not the two sides that haven’t been able to come to an agreement for the past twenty years?

Further, the brave souls at the commission add they are not sure whether they have the right to even make this ruling and have sent their opinion to the courts for an opinion. Why not a Royal Commission?

If I had to make a guess I would say the CRTC’s favorite color is beige, no gray, no beige, no…you get the idea.

The best Canadian response to the ruling so far is by the Globe’s increasingly irrelevant television columnist, John Doyle. He writes, “With any decision it reached, it would have underlined why its own existence is a necessity.” Huh.

Look, it is no secret that I do not believe the networks should be allowed to charge for their signals. They accepted a license that provides for free access to their signals. For years they made fortunes. Broadcasting was called a license to print money and the network owners took great advantage of that license. Ivan Fecan and the Aspers are not living in tenements in Toronto and Winnipeg. Every time CTV and Global were given the opportunity to protect Canadian TV they chose the U.S. option. Global was behind the CRTC decision that did more to kill local TV than any other single cause: Global won the right to use anything produced by any local station on any other station in Canada and call it local. Thus a show produced in Toronto could now be deemed local content in Calgary or Halifax.

What burns me almost as much as having to pay for free TV is the fact that I will not be given the choice if and when the policy comes into being. The networks are demanding must carry status. That means that all cable and satellite users will have to pay for network TV even if they don’t watch CTV or Global. Call me a crazy democrat but I believe the viewer should have the right to opt out of taking a channel if we are forced to pay for it. I want the CRTC to rule out any must carry and to put an end to bundling. As a consumer it should be my right to pick and choose the channels I will pay for. The CRTC promised this some time ago but has never followed up.

Let CTV and Global charge cable and satellite for their signals correspondingly allow me choose to watch them with rabbit ears or an antenna for free.

Oh, and what about local television? Wasn’t the point of the exercise to save local TV? Isn’t that what CTV and Global told us? I didn’t see any part of the CRTC ruling that changed local content rules. I didn’t see a call for more local content. In fact the word local doesn’t appear in the decision. I guess the networks and the commission are betting on the short memories of a disengaged populace.

Yes the networks are having some financial difficulty. In case you haven’t noticed, so are most Canadians. We are coming out of the worst recession since the Great Depression. Everyone agrees that this is not the time to raise taxes, hell, even the NDP agrees, so the last thing we need is a new TV tax. Will CTV and Global survive? That should depend on their ability to get eyeballs back from the internet, from specialty channels, not on their ability to get a guaranteed annual income. Canadians should not be punished for their entertainment choices or for the failure of corporate broadcast giants. That’s bad policy.

The numbers that have come out recently speak to the CRTC and the networks being out of touch with the Canadian reality. Canadians are sitting in front of their computers more than they are watching TV. CTV and Global raised their spending on U.S. content, dropped spending on Canadian shows and they lost even more money in the process.

Bad decisions all around. The CRTC, CTV, Global, welcome to the 21st century. Ten years later and they have barely noticed.

Filed under: Media Commentary, Political Commentary, , , ,

Bye Bye Network TV

With all the ‘bull’ being raised at the CRTC hearings in the National Capital District it amazes me that nobody has glommed onto the obvious. The great television networks of North America are a dying breed. CTV and Global are wasting their time and ours by arguing for a future that doesn’t exist. In fact if you read between the lines, subscription fees are another way of saying “we want to be a cable service.”

The greedy part of what they are doing is that they are attempting to keep all the perks of over-the-airways channels: must-carriage, simulcasting, the best spots on the dial, while charging the same sort of fees that TSN, Slice or W charge.

The real truth is that they cannot win these new fees without offering something huge in return. The most obvious is to promise greater amounts of Canadian content. It will be the CRTC’s job to make sure that the content they offer is in the form of drama, comedy and documentary production. The nets would far prefer to offer cheaper reality TV. The nets will offer the Canadian programs in dead zones like opposite hockey, Friday nights, outside prime time. It will be the CRTC’s job to get guarantees for a percentage of prime time and while I’m at it, an assurance that Canadian shows will have the same sort of promotion budgets that the big U.S. shows get.

I’m not holding my breath. The CRTC is toothless in dealing with the networks. Global seldom if ever lives up to its license guarantees. CTV uses every trick to shortchange Canadian production. The CRTC has always been silent on any transgression.

The bread and butter of CTV and Global is the big U.S. blockbuster series. That’s where they get their audience. That’s where they make their money. The U.S. shows are way cheaper to buy than spending $2 million and more per episode on Canadian drama. And here’s the rub: the U.S. networks are in as bad shape as CTV and Global.

Many American media experts point to two events in the past year as forewarning the end of the network era. First came Jay Leno’s new prime time talk show. It basically said NBC doesn’t have the money to produce three hours of prime time every weekday. More recently Oprah’s announcement that she is walking away from her hugely successful show that runs on network television. Everyone knows she will reappear on her own cable station that’s about to be picked up by cable and satellite companies in the U.S.

The writing is on the wall. NBC is trying to sell itself to Comcast, the biggest U.S. cable operator. What’s fascinating about this sale is that it’s General Electric’s cable channels: Bravo, USA, MSNBC, SyFy and CNBC, not NBC are what Comcast wants, not the fourth place broadcast network.

The experts agree that broadcast TV that relies on advertising may be a broken model. In a recent article in the U.S. Tim Arango and Bill Carter looked at the future of broadcast networks:

“The business model of the big three networks — which became four when Fox began prime-time programming in 1987 — has for decades relied on a simple formula: spend millions on original programming that will attract advertiser dollars and later live on as lucrative reruns in syndication.
But ratings are going down. In the 1952-53 television season, more than 30 percent of American households that owned televisions tuned in to NBC during prime time, according to Nielsen. In the 2007-8 season, that figure was just 5.2 percent.
The mass audience — the bread and butter of broadcast networks — has splintered into niches as viewers flock to alternative entertainment choices on the Internet, to video games and to cable channels dedicated to individual tastes, like Ms. Winfrey’s forthcoming OWN, the Oprah Winfrey Network.
And yet, programming remains expensive — a network drama costs about $3 million for one hour — and advertisers are becoming reluctant to pay ever-rising premiums for prime-time shows. All the networks have tried to adjust, putting on more reality programming, for example, that is cheaper to produce.
NBC made perhaps the biggest bet of all — moving Jay Leno to prime time each night at 10, saving the millions it would have cost to develop a scripted show in that time spot. The Leno move has been the subject of intense scrutiny by the media, because Mr. Leno’s ratings have lately fallen on several nights well below even the modest guarantees NBC made to advertisers.
While networks have found it difficult to charge ever-higher advertising rates in the face of declining ratings, big cable channels — like USA, TNT and TBS — have flourished with the millions of dollars in subscription fees from cable operators that they receive, on top of advertising.
“The cable players have a robust affiliate fee stream that allows them to better finance original programming,” said Anthony DiClemente, a media analyst at Barclays Capital. “The main structural issue right now with broadcast is that the vast majority of revenues are from advertising.”
Profit margins for cable networks are also much better than broadcast networks’. Derek Baine, a senior analyst at SNL Kagan, said big cable networks earned profit margins of 40 to 60 percent, while a good year for a broadcast network is a 10 percent profit margin.
Illustrative of this is a comparison of NBC to ESPN, one of the most popular cable channels. Last year, revenue for the two networks was roughly equal. NBC, according to SNL Kagan, generated about $5.6 billion in advertising dollars; ESPN generated a total of about $6 billion in revenue — $1.6 billion from advertising and $4.4 billion in subscriber fees. But ESPN was vastly more profitable. Its cash flow was about $1.4 billion, while NBC’s was $304 million.”

What does this mean for CTV and Global? It means the shows they have depended on to survive, the ones they want even better access to, may soon cease to exist. How long can a dying industry continue to produce $3 million episodes that get smaller and smaller audiences? Not long. Global without House and NCIS is dead. CTV without the CSI’s and Grey’s Anatomy is likewise in big trouble.

So, instead of looking at ways to save the dinosaurs shouldn’t the huge brains at CTV, Global and the CRTC be planning for a very different future? A future where all TV is either by subscription or pay-per-view. A future that includes on-demand TV and television via the internet and cell phone. If these guys are so smart why can’t they see what’s happening before their eyes right now? The stupidity of the Aspers, Fecans and von Finckensteins is frightening to me. How about you?

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Liars Poker at the CRTC

After several months of interminable, fact free and boring ads, the CRTC has spent the last week and a few days trying to get Canada’s broadcasters and cable and satellite companies to come to some agreement on fee-for-carriage, in other words, allowing the broadcasters to get paid for what has always been a free service. As all Canadians know by now the public face of the battle is between the cable and satellite operators who claim they want to save us from the dreaded new “TV tax” and the country’s broadcasters who want to save local television.

Anyone who has paid even peripheral attention to the debate knows that both sides are, forgive the colloquialism, full of crap. The broadcasters have never shown any interest in local TV. The last time CTV cared was when it was a consortium of private owners like the Bassetts in Toronto and the Peters in B.C. who actually controlled the network. The shoe was on the other foot in those days. There was little interest in the network. Since Bell and the Globe Media bought out all the individual owners and centralized the running of the network local has been a bad word at CTV.

It’s even worse at Canwest/Global. Here, there has never been any interest in local TV. Before Izzy Asper got control, Global TV served all of Ontario from Toronto. There was never any coverage of Sudbury, Thunder Bay, Windsor, London etc. In Winnipeg the Asper station was a joke. When I was news director at Global and there were massive forest fires in Manitoba Izzy’s Winnipeg station refused to cover the fires. “Too expensive” they said. “We don’t have the manpower” they argued. We had to send a crew from Toronto.

In truth, and we all know this to be true, all CTV and Canwest/Global care about is the money. They have gone about making this abundantly clear in the past week. When Ivan Fecan, head of CTV, was asked if he would guarantee the fee-for-carriage money would go to local TV and local programming he said no. Canwest/Global said the same. So what was the point of all the advertising produced and aired by CTV and Global? Was it a false advertising? The only conclusion I can come to is yes, it was all a lie.

Further, to prove that money is the only motive, the networks level of greed showed no boundaries, they took their chutzpa to new levels demanding that on top of being paid for their free signals they want to expand simultaneous substitution. According to Michael Geist in The Globe and Mail:

“The broadcasters now wish to expand simultaneous substitution policy with program deletion…when a Canadian broadcaster purchases the rights to a U.S. program, they would have the right to air it whenever they choose within a seven day window. The hook is cable and satellite companies would be required to block the U.S. broadcast of the same program if it did not air simultaneously.
“The proposal, which would lead to millions of Canadians regularly encountering blank screens instead of expected programs, would perversely increase the attractiveness of U.S. programming…it would (also) send more Canadians away from broadcast television to the Internet…”

The broadcasters confirmed as well, they are not willing to invest in digital transmitters for all the local communities leaving residents in small cities like Kingston without any over the air signals, another slap at local TV. To add insult to injury the broadcasters are asking for an extra two years to make the switch to digital. In the U.S. that job was completed earlier this year. CTV and Global want us to wait another four years. You may wonder what difference that makes to you. Well, it means the new spectrum , 700 MHz, that was supposed to come available will not. That means Canada will lose billions of dollars in revenues from selling that spectrum and that new wireless and open internet innovation and competition will not be available to Canadian consumers.

In the face of all this, it should be a slam dunk for the cable and satellite operators. The broadcasters want everything and are willing to give back nothing.

Well that sounds like the real world. The CRTC has seldom, if ever, had close ties to the real world. The consumer is always at the bottom of the CRTC’s list of cares. The CRTC’s job, as they see it, is to protect Canadian TV. Not TV production as in new dramas and comedies, but TV distributors and stations. The reason: without a bunch of TV stations operating in Canada there is no need for the CRTC to oversee television. So they protect the millionaire owners. More important to the CRTC is cable. Every decision they make is to fortify cable. As long as most Canadians get their TV through cable the CRTC is powerful. You see, you cannot block over the air signals at the border, you cannot stop satellite feeds from entering Canadian air space, but you can control Canadian companies who distribute these signals over cable to millions of Canadian homes. Thus, over the years the CRTC has become the political arm of Rogers Cable. I have appeared before the CRTC five or six times and on each occasion at least half the commissioners were former Rogers employees. In many cases they went back to work at Rogers after their term was up at the CRTC. The connection is too obvious and has been going on for too long to call this a coincidence. CRTC decisions inevitably favour the cable companies first, the broadcasters second, the satellite companies third and I have to say it, the consumer never.

So where does this leave the entire debate? It’s impossible. The CRTC can’t hurt either side. It explains why Konrad von Finckenstein says he’s sick of the whole thing. He finds himself on the horns of a major dilemma: how to help the greedy broadcasters without harming the greedy cable companies or vice versa. To make it worse, signals from the government suggest they don’t want the consumer to pay. Tough luck Konny, you lose no matter what you decide. Here’s hoping you don’t take the rest of us with you.

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Battle of the Blades

When I first heard about it I thought it was one of the truly dumbest ideas for a new television show that had ever been contemplated. A bunch of rough and tumble former hockey players lacing on figure skates and pairing with some of Canada’s best female pairs skaters, who thought this would be a good idea? Only the CBC could come up with this concept and allow it to get to air.

Guess what? I was wrong. I hesitatingly tuned in to what I expected to be massive disaster. Perhaps I even subconsciously wanted it to fail. I used to like to think I knew a good idea from a bad one. But I was hooked. Not only is Battle of the Blades a well produced and conceived TV show, it is utterly charming entertainment that both men and women can love and most of all, and this is what the CBC and the producers deserve the most credit for, it is the first originally Canadian reality show. Battle of the Blades may even be the first truly original Canadian TV show.

For those of you who didn’t tune in on Sunday night I will describe the show. Half-a-dozen former National Hockey League players, from goons like Tie Domi to pretty boys like Ron Duguay, are teamed up with some of the best female “pairs” skaters this country has produced. They train for a “LIVE” free skate together and their performances are judged by a panel that includes two great Canadian figure skating stars, Sandra Bezic and Dick Button and a third judge that will change every week, in this case it was former L.A. Kings goaltender Kelly Hrudey. Of course there’s the great build-up with lots of pictures of the hockey players falling over their toe picks and dropping the women in practice sessions. All this beautifully sets up the expectation of disaster. Finally we come to the time to perform and a glitzy, beautifully lit set has been created at Maple Leaf Gardens with a live audience on hand to lend atmosphere to the proceedings.

As it turns out almost all the hockey players do very well. Ron Duguay in fact, looks like he could have been a great figure skater had he not been a very good hockey player. Sure most of the artistic skating was performed by the women, but the men, except for Bob Probert, the former Chicago Black Hawk fighter, did not look out of place.

It was a truly riveting hour of TV. Yes, many watched to see the men fall or the possibility of a train wreck, but what every viewer got was not disappointing: they were entertained.

Where the show sparkled was in its down home Canadian charm. This was not a program that attempted to be anything that it wasn’t. There was no pretense. It was a bunch of jocks, regular guys, Canadians having a great time doing the unexpected. The female skaters seemed to enjoy it as much as the hockey players. The charm of the characters continually shone through. In the end I found myself liking each and every one of the skaters.

Donald Button was perfect as both a judge and a personality. He made it fun by being willing criticize as well as praise.

The only negative I could find was Ron MacLean. Is it me or is MacLean becoming so predictable with his bad puns and dry humour that I prefer to turn off anything he is involved with. A few years back I wondered why CBC was giving him a hard time when his contract was up. Now I think it’s time for Ron to hang up the mic and for CBC to find another sports host.

When Battle of the Blades comes back next year, and based on the great ratings for week one I’m sure it will be back, I would like to see a few more hockey stars like Ron Duguay and Tie Domi, guys who are showmen; hockey players who are happy to display their infectious enthusiasm. Skating ability is secondary on this show, having fun is what it is all about. That goes for the audience too.

The TV Tax – An Update
On a very different note, a few weeks ago I would have bet the farm that the CRTC was going to rubber stamp the CTV, Global and CBC request to be paid by cable and satellite companies for distributing their signals. The bogus claims by CTV and Global that this was to save local TV seemed to have some resonance with both the politicians and the people.

Now, after an effective counter attack by the cable and satellite companies it appears the networks might not get their undeserved millions. Polls are showing a vast majority of Canadians are against what is really a new tax on television in Canada. I don’t know if this is the reason but the Harper government has stepped in. They have asked the CRTC to look into how the new charges would affect Canadian TV viewing and how Canadians feel about the new levies.

To me this seems like code for “kill the new tax.” The CRTC is supposed to work arms length from the government but the request by the Conservatives is at worst a delaying tactic and at best a signal to the bureaucrats that they would be making a mistake to give the networks a $50 million windfall for nothing in return.

Stay tuned. We will hear a lot more about this before a decision is made.

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Private Network Pirates

Canada’s biggest networks could not make it any clearer. They are cynical, money-grubbing entities that are not worth giving the time of day let alone the millions they are trying to squeeze from television viewers in Canada.

Let’s look back at how the last few months have played out. First CTV and Canwest/Global cry poor and beg the federal government through the Canadian Radio Television and Telecommunication Commission (CRTC) to force the cable and satellite companies to pay them for their signal. They claim this is so they can save local television. Let’s leave aside the fact that their buying spree of local TV stations followed by their cutting them to the bone have been a primary cause of the failure of local TV. The networks shamelessly produced commercials and invited the public to their stations to explain why local television was in danger of disappearing. These fine upstanding TV moguls told us they want the opportunity to save their local stations and the only way that could happen was to charge all Canadians a few bucks for their services.

The CRTC then caves in to the demands of the millionaire owners. A new levy of 1.5% is to be added to your cable or satellite bill which is supposed to go towards local television production. Problem solved.

Not so fast. While waiting for word from the feds about the bailout the networks got busy. Victoria, B.C. and Red Deer, Alberta will see their stations closed. CTV sold its Brandon, Manitoba station and Canwest/Global sold CHCH in Hamilton and CJNT in Montreal. But hey, you say, they got money. Not enough it seems. The networks still want to charge for their programming even though their last pretense, saving local television, has gone by the wayside along with five local stations.

This whole situation is just plain crazy. The networks bought up every available station in Canada. CTV bought the CHUM/CITY group with all its “A” Channels across the country and specialty stations. Canwest/Global bought CHCH and Alliance Atlantis with a large roster of cable and satellite channels. This came years after CTV bought a bunch of small over-the-air stations from Victoria to Northern Ontario and Canwest/Global opened stations in Montreal and the Maritimes. The networks created a huge debt load they can’t sustain. Add in the recession and their troubles mounted. They screwed up. Their eyes were bigger than their stomachs as my mother would say when I wanted too much food at dinner. The CRTC knows this. The feds know this. So why are we contemplating bailing them out, now especially, when they have abandoned the reason for the bailout, local TV?

Here’s my take. If Canwest/Global is serious about operating a television empire in Canada they should immediately sell or shut down The National Post. It barely exists anyways after the staff slashing that has gone on for over two years. You don’t save a newspaper by providing less and less news on its pages. It is an empty shell. Further, it’s time to sell off the foreign assets like Channel 10 in Australia. Why should Canadians pay to support failure and foreign ventures? Canwest/Global has some excellent assets in its stable of cable networks. They could get all the money they need by picking two or three of their cable stations and selling them to Rogers or Astral Media. Save yourself before you ask me to save you. Finally, I would demand that Canwest/Global become serious producers of Canadian content. When I worked there they never lived up to their CRTC license agreements and they constantly cheated on the money they claimed they spent on Canadian content.

If CTV wants to prove it is serious about its commitment to Canadian programming and to Canada it too will have to produce and invest in more than the odd Canadian drama and comedy and schedule the Canadian shows in time slots that are not dead zones opposite Canwest/Global’s few winners. CTV too has plenty of assets that they could sell to tide them over the recessionary hump. Did we need a TSN2 at a time when CTV says they have no money?

I’m probably wasting my time and energy because of the political power the networks command. I cannot see any way they will not get their money from us. The CRTC wimps and the toady politicians will cave to their demands. But has anyone thought about the long term affects of the large increases in the cost of cable and satellite? Will you continue to buy History Channel and Discovery Kids if you need to save a few bucks because of the rising cost of cable? Is MTV Canada and CTV News Channel still worth having when you can’t afford the satellite TV cost increases? Are CTV and Canwest/Global actually hurting their own bottom lines with this irrational demand for new payments for their network signals?

So far I have seen no sign of intelligent life at Canwest/Global since Izzy Asper died and left the company in the hands of his kids. At CTV I have seen a company that has managed to lose money while running seven of the top ten shows in Canada, a feat worthy of public ridicule. This is what we are being asked to prop up, greedy owners who have mismanaged a license to print money in the good times and are now paying the price in the bad times. Only they don’t want to pay the price, they want us to.

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About the Author

Howard Bernstein is a former TV producer. He has worked at CBC,CTV, Global and has produced shows for most Canadian channels as an independent producer.

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