OTTAWA-GATINEAU – A 12.2% increase in spending on the likes of CSI, House, Lost, Prison Break, Ugly Betty, and other U.S. shows helped decimate broadcast TV profits in the 2006 broadcast year, said the CRTC on Wednesday.
While overall Canadian television station revenues were flat at close to $2.2 billion, expenditures rose by 7.8%, which reduced profits before interest and taxes (PBIT) from $242.2 million in 2005 to $91 million in 2006. The PBIT margin also decreased from 11.02% in 2005 to 4.14% in 2006.
From 2005 to 2006, revenues from the sale of local advertising grew by 3.4% to $375.4 million, while national sales remained the same, at $1.5 billion. In 2006, conventional television stations generated $2.2 billion in revenue during the broadcast year ended August 31, 2006.
Revenue from infomercials is way up in recent years, too. Canadian broadcasters earned $23.5 million from the likes of 1-900-number companies, silly exercise devices, and other assorted products regular retailers won’t carry. That’s an increase of 23.7% over 2005 and 41.6% over 2003.
Expenses went up from $1.9 billion in 2005 to $2 billion in 2006, mainly due to a 10% increase in total expenditures on Canadian and foreign programming, said the Commission. In particular, spending on foreign programming increased 12.2% in one year, climbing from $613.2 million in 2005 to $688.3 million in 2006.
CanWest, and to a lesser extent, CHUM, were aggressive in the U.S. market last spring, trying to break the ratings stranglehold CTV has held for the past few years on the top 20 highest-rated shows in Canada.
Canadian programming expenditures recorded a more modest increase of 6.3%, from $587 million in 2005 to $623.7 million in 2006. Of this amount, $144.7 million was paid to independent producers to acquire Canadian programming, an increase from the $138.5 million paid to them in 2005.
In 2006, broadcasters spent $73.9 million on drama and $101.6 million on general interest programming. Spending on other Canadian program categories included $328.1 million for news programs, $66.3 million for other information programs, $35 million for musical and variety shows, $9.3 million for sports programs, and $5.7 million for game shows.
The industry remains a good one to be employed in. In 2006, the private conventional television industry employed 8,197 people and paid a total of $593.6 million in salaries. The national average salary was $72,424 (a 3.2% increase) but it’s better to work in broadcast in B.C. (average salary $77,000-plus, than the Prairies ($66,200).
Of course, it’s best to be at the CBC, where the average salary in 2006, says the CRTC, was $86,275.
