CCR Short Takes

Broadcast distribution statisticsCable Class 1 and 2 systems Revenue20032002Subscription $3,604,691,225$3,430,014,091Total Revenue$4,162,949,561$3,859,793,642Pre-tax Profit$225,199,488$1,399,087SubscribersBasic6,867,8377,014,460Non-Basic5,422,4195,579,970MDS and DTH Revenue20032002Subscription $1,160,383,942$922,104,624Total Revenue$1,203,060,366$945,754,788Pre-tax Profit-$213,165,740$423,148,383SubscribersBasic2,201,6882,016,615Non-Basic717,1091,862,271 CAB, CCTA ask for right to respond on Spike TVThe Canadian Cable Television Association (CCTA) is asking the CRTC to "provide all parties with the opportunity to respond to the submissions of other parties with respect to any comments filed on or before May 17, 2004." The CCTA notes that any proposals made in response to the commission’s calls for comment on whether Viacom International Inc.’s rebranded Spike TV should be removed from the list of foreign services eligible for carriage in Canada or ordered to be linked exclusively with Canadian pay TV services could have "a material and prejudicial impact" on Canadian distributors and their customers. The CCTA’s April 1 request for the right to reply follows a request a day earlier by the Canadian Association of Broadcasters (CAB) for confirmation that it would have the right to reply to any proposals made in the process (CCR, March 25/04). "Given the commission’s questions…are framed in the context of the CAB’s June 2, 2003 and August 15, 2003 letters to the commission, and may lead to proposals from interested parties that could have a material impact on the operations of Canadian specialty and pay services, the CAB submits that it should be provided with the opportunity to submit a written response with respect to any comments filed on or before May 17, 2004," the CAB notes in its March 31 letter to the CRTC. 100 channels planned for CHUM’s proposed radio serviceCHUM Ltd. anticipates launching a national subscription radio service, beginning in the four major cities of Toronto/Hamilton, Montreal, Vancouver and Ottawa, if granted a licence, according to company financial results for the three months ended Feb. 29, 2004 that were released April 19. By the end of the first licence term, the service - CHUM Subscription Radio Canada (CSRC) - is expected to reach 60% of Canada’s population. CSRC would use over-the-air spectrum to deliver initially 50 different channels of commercial-free programming that would grow to 100 channels. CHUM filed an application with the CRTC to provide subscription digital radio in Canada by the February 16 filing deadline. It was one of three applications received by the commission (CCR, Feb. 27/04). Look Communications continues to lose TV subscribersLook Communications Inc. had 40,900 digital television subscribers at Dec. 31, 2003 - 13,500 were in multiple-unit dwellings and 27,400 in single family homes. The company lost 400 net digital television subscribers in the fourth quarter ended Dec. 31, 2003. The loss of TV subscribers in the fourth quarter was the lowest in three years. Look had revenues during the quarter of $12 million compared to $12.6 million for the same period in 2002, partly the result of a lower subscriber base, according to financial results released April 16. The net loss for the 2003 fiscal year was $6.4 million, compared to a net loss of $2.7 million on a fully diluted basis for 2002. Rogers makes offer to DirecTV satellite viewers losing serviceRogers Cable Inc. announced April 21 that it would swap the "dead" satellite equipment of DirecTV viewers with Rogers Digital Cable. In exchange for the satellite equipment, the customers will receive free installation and up to two free digital boxes from Rogers. Rogers intends to install its service at the homes of the former DirecTV viewers within 24 hours. Rogers adds digital cable households, loses basic subsRogers Cable Inc. added 27,900 digital cable households in the first quarter ended March 31, 2004, according to financial results released April 20. The growth was offset by a net loss of 3,400 basic cable subscribers. Still, operating revenue at Rogers Communications Inc.’s cable division grew 9.3%, and at its media division by 9.7%. Within the media division, revenue in radio increased 14.1%, in television 23.2% and 10.6% at The Shopping Channel. About 40% of the growth in TV revenues was driven by improved revenue results at Sportsnet, with the remainder being attributable to the acquisition of a 50% interest in Dome Production Partnership on Jan. 2, 2004 (CCR Update, Jan. 7/04). Family gains tween viewersAstral Media Inc. announced April 19 that its Family Channel is the number one television network in Canada with tweens, or kids aged 9 to 14. According to Nielsen Media Research it registered a 28% gain in tween viewership over the last year. VisionTV seeking another rate increase in licence renewalMulti-faith specialty channel VisionTV is seeking another increase of 2 cents in its wholesale rate, according to its licence renewal application that was gazetted April 7 (Broadcasting Notice of Public Hearing 2004-3). VisionTV pledges to use the additional money generated from the wholesale rate increase to fund "the development and production of Canadian drama that celebrates and reflects our cultural diversity" and to establish a marketing plan to promote such programs to Canadian viewers. Specifically, VisionTV tells the CRTC it would commit to a minimum of $1.3 million per year to projects arising out of the Cultural Diversity Drama Competition, which rewards innovation of Canadian producers and creates new drama series. In interrogatories, the CRTC notes that according to VisionTV financial projections provided with the renewal application, the channel will earn in excess of $3 million in profits over the course of the next licence term, under either a 2-cent wholesale increase scenario or the status quo. The commission, therefore, questions VisionTV about the feasibility of implementing the proposed initiatives without the subscriber increase. VisionTV responds that the proposed drama initiative would not be possible without the additional funding from a rate increase. "We note as well that the projected PBIT of less than 2.7% over the licence term is far below the industry average for national analog specialty services. Indeed, a PBIT of $3 million is achieved by many services in a single year. But surplus, albeit a small surplus, is necessary for VisionTV to manage cash flow, pay suppliers including independent producers in a timely fashion, and meet financial obligations on an ongoing basis," VisionTV responds to the CRTC questioning. It adds, "The recent financial success…unprecedented in VisionTV’s 15-year history, has been the result of stringent cost controls that will not be sustainable at the same levels over the long term without substantially diminishing the quality of the programming and services being offered to viewers." In a contentious decision in January 2003, VisionTV was granted a 2-cent wholesale rate increase to 10 cents a month per subscriber. Three commissioners dissented on the decision. At that time, VisionTV had requested a 3-cent increase (CCR, Jan. 30/03). VisionTV was granted only a short-term licence renewal in 2001 due to non-compliance with its Canadian content requirements (CCR, March 1/02). The licence renewal application will be heard at a CRTC public hearing on June 7. Telesat installs new digital uplink system for CTV Inc.Telesat Canada has installed a new digital uplink system for CTV Inc. as part of a six-year contract. The deal includes a full-period C-band channel as well as a Tandberg Television digital video compression system that will allow CTV to create eight standard-definition TV channels. CTV will use these channels to distribute programming from Telesat’s Toronto teleport to 24 CTV-owned and affiliated stations across Canada. The new channels will allow CTV to handle last-minute changes to its TV programming schedules more easily than in the past, Telesat states in an April 8 media release. CTV will use four channels to distribute national programming, three to replace terrestrial fibre routes and one to accommodate special requirements.

CCR Short Takes

Broadcast | April 22, 2004

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Broadcast distribution statistics
Cable Class 1 and 2 systems
Revenue	2003	2002
Subscription	$3,604,691,225	$3,430,014,091
Total Revenue	$4,162,949,561	$3,859,793,642
Pre-tax Profit	$225,199,488	$1,399,087
Subscribers
Basic	6,867,837	7,014,460
Non-Basic	5,422,419	5,579,970
MDS and DTH
Revenue	2003	2002
Subscription	$1,160,383,942	$922,104,624
Total Revenue	$1,203,060,366	$945,754,788
Pre-tax Profit	-$213,165,740	$423,148,383
Subscribers
Basic	2,201,688	2,016,615
Non-Basic	717,109	1,862,271