Pay and specialty broadcasters received $1.8 billion from carriage fees in 2007

Canada's specialty, pay, pay-per-view and video-on-demand services generated $2.7 billion in revenues in 2007, with $1.8 billion via carriage fees, according to the financial summaries released by the CRTC last week. More than $900 million of this was invested in Canadian programming, compared to about $320 million spent on foreign shows. Highlights from the commission's annual Pay, PPV, VOD and Specialty Services Statistical and Financial Summaries also reveal the remaining revenues were derived from national advertising ($928.8 million), local advertising ($19.8) and other sources ($44.3 million). While the carriage fee figures show how significant this revenue source is for specialty broadcasters, it is not received without a substantial return to the Canadian system. As Canadian Communications Reports reported in March, Canada's conventional broadcasters spent $430 million more on foreign programming than on Canadian shows last year. The specialties, conversely, spent $594 million more on home-grown content, with $319 million of that going to independent Canadian producers. Canada's 142 specialty services generated the bulk ($2.2 billion) of the revenues. They were followed by pay television services ($349.7 million), pay-per-view television services ($119 million) and VOD services ($78.8 million). Of the $2.2 billion in revenues received by the specialties, $1.9 billion went to the 49 analog specialty channels, $78.9 million was generated by the 18 Category 1 digital services, and $154.3 million went to the 75 Category 2 digital specialties. Overall, the sector's revenues increased 9.1% over the previous year, which translated to a 13% growth in profit before interest and taxes (PBIT) to $647.1 million. As well, the pay and specialty services increased their PBIT margin from 22.92% in 2006 to 23.75% in 2007. By genre, programming expenditures were: $230.6 million for sports programs; $210.2 million for other information programs; $168.3 million for drama; $148 for news; $67 for general interest programming; and $45.6 million for musical and variety shows. Although the sector spent much more on Canadian programming than on foreign, its foreign expenditures recorded more substantial growth - increasing 10% between 2006 and 2007 compared to a 3.3% increase for Canadian program expenditures. Sector employment and salaries were also up substantially over 2006. The Canadian specialty, pay, pay-per-view television and VOD services industry employed 5,490 people, and paid a total of $407.8 million in salaries. In comparison, in 2006 this industry employed 5,264 people and paid a total of $374.6 million in salaries.

Pay and specialty broadcasters received $1.8 billion from carriage fees in 2007

Broadcast | April 28, 2008

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