CCR Update

O’Farrell tells convention that debates herald a move forwardCanadian Association of Broadcasters (CAB) president and CEO Glenn O’Farrell said that debate around how broadcasters should deal with new technologies was the "beginning of a forward movement, not its end." Speaking at the association’s 79th annual convention in Winnipeg, he continued, "To find our path to the future, we must support entrepreneurial action with a new policy environment. Industry and government must work together in the public-private partnership that has served Canada so well. We must revitalize the framework to meet the new challenges." The challenges, he said, include the rapid pace of adoption of new technologies. In his opening address, O’Farrell listed off a number of developments that will change broadcasting, including audio and video content being sent to consumers through ubiquitous technology, smarter devices such as the iPod, the arrival of commercials and ads for cell phones that receive video content, the licensing of subscription radio, the widespread emergence of Wi-Fi hotspots, and numerous new other broadband developments. "All these exciting, new technological developments are profoundly altering the way consumers can access content," he said. "When you step back from the flurry of activity, and attempt to grasp the significance of these events, the picture fuses from one of multiple incremental, individual developments into a composite picture of fundamental and transformative change." Lippman calls podcasting the broadcasting of the futureAndrew Lippman, senior research scientist at the MIT Media Lab, in his opening keynote address at the Canadian Association of Broadcasters (CAB) convention in Winnipeg suggested broadcasters will have to think of their TV signals as being licensed to a person, not a home, to survive the future. "My message of today is that technologies will be to the person," he noted, boldly stating that podcasting would be the future of broadcasting. For more coverage of the convention, see the upcoming issue of Canadian Communications Reports. Aliant launches trial of wireless network Aliant announced November 1 that it would launch a technology trial of its evolution data optimized (EV-DO) network in Halifax later in the month. Up to 35 trial participants will be able to access wireless data speeds of up to 2.4 Mbps, and experience new applications on wireless devices, such as live TV. CHUM predicts ad downturn with NHL hockey, Winter Olympics on other stationsCHUM Ltd. predicts advertising dollars will shift away from its conventional TV stations to other stations broadcasting NHL hockey and the upcoming Winter Olympics, according to financial results for the three months and fiscal year ended August 31. "While management believes that the program schedule for Fall 2005 on its conventional television stations has improved over Fall 2004, overall, management expects advertising revenue growth on its conventional television stations to be modest," states the financial results released October 28. CHUM states that its conventional TV stations will continue to "operate in a challenging and competitive environment in fiscal 2006." In contrast, the broadcaster expects "continued momentum in industry growth of specialty television advertising revenue." But it says that its specialty TV channels MuchMusic and Bravo! may experience slower growth in advertising revenue in fiscal 2006 as a result of possible lower ratings during a transitional period in the program schedule of channels." CHUM notes that about 72% of its revenue in the fiscal year ended August 31 was derived from advertising, which is expected to continue as the main source of future revenue. It lists this dependency on advertising as a possible risk factor going forward. "Advertising revenue fluctuates in response to consumer confidence, general economic conditions, a changing regulatory environment and viewership, and, as a result, remains unpredictable," states CHUM. It adds that most of its ad contracts don’t extend beyond 12 months, and some may be terminated by the advertiser on four weeks’ notice. "Continued weakness and/or instability in the global economy could cause a further decline in future advertising revenue," states CHUM. On a consolidated basis, the company’s net earnings for the year ended August 31, 2005 increased by 11.7% to $41.4 million from $27 million. For the fiscal year, TV revenue increased 5.3% with the company’s specialty TV stations providing the growth. Ad revenue for CHUM’s specialty TV channels increased 13.6% and subscriber revenue grew 15.3% over the previous year. Ad revenue during the fiscal year for its conventional TV stations was down 2.1% compared with the previous year. The performance of the company’s TV segment excludes CHUM’s recently acquired TV assets from Craig Media to provide a more even basis for comparison. With regard to its radio plans, CHUM states in the financial results that it is still in the process of reviewing whether to proceed with launching its licensed terrestrial-based satellite radio service or not. But during a session at the Canadian Association of Broadcasters (CAB) convention in Winnipeg on November 9, a CHUM executive stated the broadcaster would not proceed with its licensed subscription radio service. Asper once again makes plea for subscriber revenue for conventional TVCanWest Global Communications CEO Leonard Asper is continuing his calls for conventional TV to be able to charge a subscriber fee. During a conference call on November 2, Asper said the "rigorous regulatory plan" advocated by Global sees cablecos having to pay conventional broadcasters for their signals, just as they do specialty TV services. He also suggested that over-the-air transmitters that allow reception of free-to-air TV signals could be eliminated. The demand for subscriber fees for conventional TV has been made by Asper as far back as Global’s licence renewal hearing in 2001 (CCR Update, Oct. 3/01). Martin appearance leads Corner Gas to record ratingsA peak of 2.2 million viewers tuned in to see Prime Minister Paul Martin’s appearance on the Corner Gas episode that aired on October 31. The show, which also featured singer Jann Arden, had an average 1.944 million viewers (2+), according to BBM data. Corner Gas drew more viewers than a repeat of the U.S. show Prison Break, which aired in the same timeslot to 641,000 people, and part two of the CBC’s original documentary Breaking Point, which drew 234,000. All levels of government spending more on culture: StatsCanadaCanada’s federal, provincial and municipal governments all spent more on culture – a total of $7.3 billion – in 2004-04, although the rate of growth in spending by the national government slowed and actually declined for the film and video industry, according to figures released October 31 by Statistics Canada. Federal spending on the film and video industry fell 2.9% to $386.2 million, with the provinces of Alberta, Ontario and Saskatchewan suffering the biggest cuts, according to StatsCan. Federal spending on broadcasting equaled $1.6 billion, or nearly three-quarters of its total spending of $3.5 billion on the culture in 2003-04. But the federal government’s funding of broadcasting was up just 0.3%, compared with 0.9% in 2002-03 and 7.5% in 2001-02. The $3.5 billion spent by the national government in 2003-04 represents a 2.2% increase from the previous year, compared with an 8.9% increase two years ago. Spending on culture by the provinces and territories was up 4.3% to $2.2 billion, which was more than double the 1.9% increase of the previous year. "The film and video industry and the heritage sector benefited the most from increased spending by the government of Alberta. At the same time, film and video suffered the most from reduced spending in New Brunswick," states the StatsCan report. On the municipal level, spending on culture was just over $2 billion, an increase of 7.1%, up from the 3.3% increase in 2002, but below jumps of 9.2% in 2001 and 8.1% in 2000. Most of the municipalities’ spending on culture went toward libraries. The figures were derived from a survey of all 30 federal, 180 provincial/territorial departments and agencies with culture-related expenses for the financial year running from April 1, 2003 to March 31, 2004. The municipal data is based on a sample of municipalities for the fiscal year from January 1 to December 31, 2003. The three main categories of spending on culture were operating expenditures, capital expenditures, and grants and contributions. All values are in current dollars, with no adjustment for inflation. CTV goes 3D with marketingCTV Inc. is giving away one million 3D glasses across the country in a marketing campaign for Medium. The episode airing on November 21 at 9 p.m. will be in 3D. The glasses will be given out on the streets of downtown Vancouver, Calgary, Edmonton, Toronto, Ottawa and Montreal in advance of the broadcast, and also in the November 19 issue of sister paper The Globe and Mail. CTV will also run a series of 30-second on-air promos in advance of the airing. Upstart broadcaster The Fight Network branching outAlthough it is one of the newest players in the Canadian broadcasting arena, The Fight Network is trying something that the established broadcasters haven’t tried. See the upcoming issue of Canadian Communications Reports for details.

CCR Update

Broadcast | November 10, 2005

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