OTTAWA – Shaw Communications is again in hot regulatory water over the sponsorship messages that have appeared on its cable community channels out west.
Last week, the CRTC issued a letter decision to the company saying some of the ads appearing on Shaw TV aren’t allowed under the regulations and applied new reporting requirements to the big cableco, since this is the second such violation.
When we reported on this in 2006, we noted that the Broadcast Distribution Regulations [Section 27(1)(h)], say cable companies are not allowed to air traditional ad spots and there are limitations on the types of advertising community channels can air. Mainly, cable must stick to general branding or soft-sell sponsorship. For example, a community channel can say: "This program is brought to you by Joe’s Used Cars on Main and Sixth, the best cars in town!" What it can’t do is a commercial running through the makes and models of this week’s best cars.
The Canadian Association of Broadcasters complained again this year that Shaw is continuing to violate that portion of the regulations with some of its ads on the community channel. The Commission sided with the broadcasters saying in its letter to Shaw that on a few of the ads, the text contains “words that promote, rather than simply describe, goods or services being sold,” and that’s a strict no-no, as only local broadcasters are allowed to sell local advertising.
“I don’t think it’s a huge issue, really,” Shaw’s vice-president, regulatory, Michael Ferras, told Cartt.ca yesterday. “It’s very few of the spots in question that are problematic. We have over 100 systems with dozens and dozens of production volunteers, so there are going to be some mistakes.”
Thanks to those mistakes, however, Shaw must now file monthly reports detailing its compliance with the regs on this matter, through the end of the company’s license term.
Ferras believes the complaint is a bit on the frivolous side, given the ad revenue ShawTV can take in with community channel show sponsorship is a pittance compared to what conventional broadcasters earn. “The amount of money we’re talking about here is pennies versus millions relative to the advertising that the broadcasters get,” he said. “And we put 100% of that money into community programming.”
Ferras added Shaw will re-visit this issue during the BDU/specialty service policy review coming up in April, saying cable companies should be able to sell normal local ads on the community channels. “It’s our view that the Commission needs to re-evaluate that whole policy. There’s no point denying revenue to the broadcasting industry that goes directly to community programming when that (revenue) will instead find a home on the Internet,” he explained.
“Any barriers to revenue within the system is simply a loss to the system.”
– Greg O’Brien
