CCR Short Takes

Decima Reader PollA plurality of respondents - 26% - to an informal online Decima Publishing poll of readers say that Canadian Heritage should be combined with Industry Canada to return to the days of one Department of Communications because competing ministers have led to foot dragging on important reforms. The House of Commons Standing Committee on Canadian Heritage has recommended that one mega-department be formed to oversee broadcasting, telecommunications and the cultural industries (CCR, June 20/03). The Standing Committee on Industry, Science and Technology agrees that there should be one department. We had our readers weigh in on the issue. Readers were asked: Should the government combine the functions of Canadian Heritage and Industry Canada into a resurrected Department of Communications? The results are: Weak subscriber growth continues for Bell ExpressVuBell ExpressVu LP experienced its second consecutive quarter of weak subscriber growth in its fiscal 2003 second quarter ended June 30, according to financial results released July 30 by parent company BCE Inc. BCE president and CEO Michael Sabia had warned during the company’s first-quarter conference call with financial analysts at the end of April that results would not improve that much over the disappointing numbers posted in the first quarter. The satellite TV operator added 18,000 net subscribers in the second quarter to end the period with a total of 1,335,000 subscribers. That’s an improvement of 5,000 net subscriber additions over the 13,000 net adds in the first quarter. Bell ExpressVu added 31,000 net subscribers in Q2 2002. On the financial side, revenues were up 23% to $191 million and average revenue per subscriber increased $3 to $47 per month, largely because of price increases and new fees. Quebecor Inc. appeal on cross-subsidization dismissedThe government announced July 28 that it was upholding a CRTC decision that ruled BCE Inc. had not unfairly cross-subsidized the entry into the TV distribution market of its subsidiary Bell ExpressVu LP. In denying the appeal, the government noted that the commission "monitors and analyses the state of competition in the broadcast distribution and telecommunications industries on an ongoing basis." Quebecor had requested that the government reconsider Telecom Decision 2002-61, and direct the CRTC "to make recommendations to the government on how best to address this (cross-subsidization) problem, whether via policy, regulation or legislation (CCR, Jan. 16/03). Céline to make appearance on CTV’s Canadian IdolQuebec popstar Céline Dion will appear in an upcoming episode of Canadian Idol, CTV Inc. announced July 25. She will be a featured guest on a segment centred on love songs. The network also announced that the reality show continues to generate top ratings. The episode on July 29 had an average national audience of 1.8 million viewers (2+), peaking at 1.9 million in the second half hour, according to the network. It said toll-free telephone and text message votes rose 15% to 1.3 million votes. CHUM reports solid growth, 2 digital channels to break evenCHUM Ltd. CEO Jay Switzer says that losses at the company’s seven digital channels total less than $4 million and that he expects two of them to break even next year. CHUM has launched CourtTV Canada, BookTelevision, SexTV, FashionTelevisionChannel, MuchLoud, MuchVibe and Drive-In Classics, and has licences for others. It is expected to launch MuchMoreRetro this September (CCR, July 17/03). But the company lists uncontrolled factors affecting the success of a specialty channel as a business risk in its financials released July 23. "There can be no assurance of the economic success of any specialty channel as revenues derived depend on distribution arrangement, subscriber penetration and audience acceptance, all of which cannot be accurately predicted. Many of the factors determinative of the success of a specialty television channel could change rapidly and some are beyond the company’s control," reads the financials. "The success of the company’s new 16 digital specialty services depends, to a significant extent, on a sufficient number of subscribers to the services. There can be no assurance that penetration rates that ensure the profitability of these services will be achieved. If penetration rates for these services do not reach acceptable levels, the company’s strategy for expanding its digital specialty channel business and its revenues may be adversely affected. The Toronto-based broadcaster also mentions that its flagship Toronto station Citytv and the NewVR "have not experienced any measurable negative revenue impact from the launch and proposed launch of these stations (OMNI 2 and Toronto 1)." But CHUM adds, "However, with the proposed launch of Toronto 1 in September 2003, the company has started to see some program cost increases for next year that are difficult to quatify." Net earnings at the company for the first nine months of fiscal 2003 ended May 31 were $23.4 million, compared to $18.2 million in the same period a year earlier. TV revenue grew 10.1% to $109.5 million in the third quarter ended May 31 compared to the same period a year earlier, while radio revenues were up 6.8% to $30.5 million. Radio-Canada tests DTM transport of video, audio over IPThe Canadian Broadcasting Corp./Radio-Canada completed an inter-city test of the broadband transport of video and audio using Dynamic synchronous Transfer Mode (DTM) technology. Net Insight provided the DTM technology-based Nimbra platform in the trial between the public broadcaster’s Toronto and Montreal operations. "I anticipate that DTM technology may provide the gateway towards remote production," says Anthony Caruso, director of technology and systems at CBC/Radio-Canada. Headline Media Group shows improvement in third quarterRevenues for the broadcasting group of Headline Media Group Inc., which operates The Score and PrideVision, increased 21.7% to $6 million in the third quarter ended May 31, from $4.9 million in the same period a year earlier. Advertising revenue was up 20.9%, or $677,000, during the quarter, while subscriber revenue rose by $0.4 million, or 23.3%, according to company financials released July 23. The company indicated that The Score had 5.3 million paying subscribers and PrideVision had 22,500 paying subscribers at May 31. Operating expenses were $4.9 million in the quarter compared to $9.9 million a year earlier. But management warned that it doesn’t expect that the broadcast group will be able to sustain these growth rates in the next quarter. It notes that the third quarter has historically been the best quarter for broadcasting, and sports and entertainment groups.

CCR Short Takes

News | 07/31/2003 4:00 am EDT

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