OTTAWA – The CRTC Friday scuttled a bid by broadcasting veteran Wendell Wilks to launch a local TV station for the Niagara region.
The founder of Edmonton’s ITV (which is now Global Edmonton) told the CRTC at a June hearing in Niagara Falls that the area is so poorly served by the existing Canadian TV broadcasters that it needs its own station.
However, perhaps sensing that the southern Ontario market is already pretty well served by TV (not to mention pretty well fragmented), there were no other competing applications.
Besides being HD-ready at launch, TVN (as reported by www.cartt.ca) had promised in its application to:
* air 40 hours of local Niagara programming every week
* produce a two hour evening newscast daily with heavy emphasis on Niagara news
* launch with a 25-person news team and 95 full-time and 60 part-time employees
* air 48 “classic movies” per week
* operate 130 cameras showing USA-Canada border crossings
Wilks also wanted mandatory basic carriage by cable operators throughout the Golden Horseshoe.
But with all of the stations available from Toronto, Buffalo, Hamilton and Kitchener-Waterloo, the CRTC took a dim view of a new station’s potential viability.
“While the Commission recognizes that TVN has put forward an innovative approach to providing a television service for the Niagara region, it is concerned about several aspects of TVN’s business plan,” reads Friday’s decision.
“The Commission considers that evidence at the hearing supports TVN’s position that it is possible for movies to achieve a rating of 0.5 in the Toronto extended market. It is, however, seriously concerned with the budget that TVN has allocated for the acquisition of the classic movies that it proposed to broadcast. Given the experience of other stations in the market in the acquisition and scheduling of movies, the Commission is concerned that the applicant’s projected cost of $770 per hour is far too low to achieve a 0.5 rating in the Toronto extended market and that a failure to achieve that rating would seriously compromise its business plan.”
Plus, added the commissioners, TVN’s predicted spend on producing the local programming it said it would do, was far too low as well.
“The cost-per-hour of local programming proposed by TVN is not only substantially lower than that of the Toronto market stations but also, according to annual returns submitted to the Commission, substantially lower than that of other television stations located in urban markets of comparable size to St. Catharines and the Niagara region,” reads the decision.
Citing recent difficulties suffered by Toronto 1 (now SUN TV), which ended up causing the outright sale of Craig Media, and the struggles of CHUM’s Victoria, B.C. station, the Commission just couldn’t approve TVN.
“(A) new television station, particularly one that competes for audience and revenues in a major market, usually experiences much greater than anticipated losses in the early years of operation. As CHUM noted, Craig was forced to sell SUN TV after it experienced initial losses that were far greater than expected,” says the decision.
“TVN’s operating line of credit combined with the cash call provisions of its shareholders agreement provide modest additional financing to address revenue shortfalls or cash overruns. However, the experience of other television stations, including that of CIVI-TV Victoria, a recently-licensed station that orients its local programming to Vancouver Island but also competes for audience in the Vancouver extended market, indicates that it may become necessary for TVN to seek substantial additional financing in the early years of operation. The Commission considers that securing additional financing in those circumstances would prove difficult and costly for TVN and would compromise its ability to implement its business plan.”
Plus, the conventional broadcast market is in a slump right now, one which TVN would exacerbate. “(C)onventional television stations in the market, taken as a whole, have experienced declines in advertising sales and viewership since those stations began operations. As noted by Global, CHCH-TV moved from a modest profit to a significant loss between 2000 and 2004. As well, as noted by Quebecor, SUN TV experienced a net loss in the order of $21 million in its first year of operations and is still losing money,” says the CRTC.
“Given these developments, the Commission is concerned that the introduction of a new competitor in the Toronto extended market could compromise the ability of existing conventional television stations to fulfill their programming commitments.”
Commissioners also used the decision to remind Global of its Niagara obligations with Hamilton-based CHCH and reiterated that station’s responsibilities. It then asked for monthly logs on how many news stories the station does in the St. Catharines, Welland, Niagara Falls area.
“During this proceeding, several participants expressed concern about the type and level of coverage provided by CHCH-TV of events occurring in the Niagara region. The Commission recognizes that, because of its wide coverage area, CHCH-TV has a responsibility to cover events not only in the Niagara region but also in Hamilton and other surrounding areas,” reads the last paragraph of the TVN decision.
“The Commission considers, however, that the regular coverage of news and events in the Niagara region is an important part of CHCH-TV’s mandate. The Commission notes that CHCH-TV’s independent advisory board files annual reports with the Commission on the station’s performance. In order that it may monitor CHCH-TV’s performance with respect to coverage of the Niagara region, the Commission expects future reports from CHCH-TV’s independent advisory board to include a listing of all news stories and other events covered by CHCH-TV that relate directly to the Niagara region, broken down on a monthly basis.”
– Greg O’Brien
