GATINEAU – After listening to nearly all the words spoken by CTV and Rogers executives and the nine-member CRTC panel (taking over 6,000 words worth of notes and sending out an embarrassing number of tweets in the process), here’s what caught our ear loudest on day one of BNC 2009-411.
Besides the CRTC chairman Konrad von Finckenstein’s wish that he could lock CTV and Rogers in a room and not let them out until you have a deal, that is…
• We now have three terms and their subsequent acronyms to describe what this fight is about: Fee-for-carriage (FFC), Negotiation for value (NFV) and value for signal (VFS). Which one should we use? Let us know in the comments box below or e-mail us at editorial@cartt.ca. We already know von Finckenstein finds the continued use of FFC “silly” but what do you think?
• CTV executives made repeated threats not just to close stations, but to walk away from the conventional television business entirely if they don’t get a fee for the carriage of their signals. “We need to collect what is ours or we need to walk away in whole or in part,” said CTVglobemedia Ivan Fecan.
• Fecan squeezed some time before the hearing to read Cartt.ca’s commentary from Monday morning on the issues, directly referencing in his comments our note on how simsub was a cable-created idea, back in 1971.
• CTV says a survey it did showed 82% of the citizens of Brandon would have been willing to pay $1 a month more to their cable company to keep now shuttered CKX-TV alive (no one pointed out that for that buck one of them could have bought CKX-TV…). However, half of the population had already switched to satellite, which never carried CKX, so one could surmise many of those Brandonites voted against CKX with their choice of TV provider.
• With the sour CKX experience still fresh, CTV demanded that DTH be forced to carry all local stations, just like cable companies have to. Vice-president, regulatory affairs Kevin Goldstein pointed out that in the States, both Dish Network and DirecTV are able to do it and are forced to do it by law. “Our DTH providers say they don’t have the technical capacity to do that,” noted von Finckenstein. Added Goldstein: “DTH providers can be very creative when looking out for themselves.”
• When asked if another dollar a month from half the Brandon market would have saved CKX, Paul Sparkes, CTV’s EVP corporate affairs added: “I think satellite carriage would have saved Brandon.”
• CTV wants a U.S.-style retransmission regime where it could decide on a per-station basis whether it wants cash for carriage or mandatory carriage, with the right to pull its signals if it can’t come to a deal with a particular BDU (something that has rarely happened, Stateside). And as we have noted a number of times before, they want the signals of the American broadcasters who air the same programming, blocked, in case of a dispute.
• CTV CEO Ivan Fecan noted customers affected by such a dispute could switch to over-the-air (in markets where there will still be OTA) or change BDUs. Von Finckenstein called those alternatives “cold comfort,” and Fecan responded that surely the Commission doesn’t want broadcasters to build and maintain transmitters it thinks “will disappoint” Canadians?
• Rogers Communications said it could accept CTV gaining the right to negotiate for a fee, as long as mandatory carriage is up for grabs too, but that it would not accept deleting the American broadcast signals to protect Canadian broadcasters’ copyrights in such a dispute. “That’s way too disruptive,” said SVP regulatory Ken Engelhart.
• Instead, in what could be described as a very canny move, Rogers offered, during such a contract dispute (and all the while insisting it would pay no fee), to maintain simultaneous substitution of the Canadian broadcasters’ advertising over the U.S. ’casters signals. So, when House and Grey’s Anatomy airs on the American stations, Global and CTV ads would still play – even during a contract fight. The Canadian signal would stay off the carrier though. (One could say that such a scenario would quickly reveal much about what Canadians think about their local broadcasters and local news, if it went missing from their cable or satellite dial while the hit U.S. fare remained.)
• The OTA stations are simply not what draws customers to cable any more, added Engelhart, “because they’re free over the air signals.” Added VP video product management David Purdy: “Why would you come to cable to get something you get for free?” Responded von Finckenstein: “Please. Over 90% of Canadians get TV from BDUs. Don’t hold up that OTA isn’t viable for you.”
• Commissioner Candace Molnar also noted that the many small, independent Canadian cable companies would have a tough time finding the leverage to negotiate with the likes of CTV and would also have trouble affording to pay a new programming cost. “They would be in a very difficult negotiating position with CTV,” she said.
• CTV wants mandatory simultaneous substitution extended to specialty channels, too. Goldstein noted how TSN has bought the rights to Sunday Night Football from NBC, but that it loses much value from the fact the NBC feed doesn’t have to be substituted the way it would be if SNF aired on CTV. The carriers object to this (but would probably do it, if paid).
• The August 31, 2011 digital transition date set by the Commission will not be met by CTV. It has OTA digital in Toronto, Calgary and Vancouver now and will get there by that date in Ottawa, Montreal and Edmonton. That serves 65% of CTV’s coverage area. It won’t be able to convert the rest of its OTA transmitters to digital until December 31, 2013 said EVP HR and operations Dawn Fell. Rogers told commissioners its five Citytv stations will be digital by the August 2011 deadline.
• Commissioner Suzanne Lamarre called CTV on their delay, pointing out they’ve known about the deadline for years and that there have been three separate digital TV transition plans since 1997. “This is not a surprise at all,” she said.
• The concept of a skinny basic was much discussed as well. CTV said that when it talked about rate regulation, it would only want to regulate a rate for a new, cheap, Cancon-focused small basic package. Rogers’ Purdy insisted that few customers buy the cheapest Rogers Cable basic only right now and suspects very few would buy such a small new package. As well, if such a skinny basic tier were created, Purdy predicted he’d field calls right away from broadcasters “asking how they could get on the skinny basic.”
• Rogers says its programming costs are rising at a rate of 12% a year and that it loses money on the video segment of its business, which it submitted info on here (see page 10)
• Both Rogers and CTV like group licensing for TV companies. But Canadian programming expenditures for ownership groups and individual channels and what minimum number of Cancon hours in prime time per channel must air are not numbers that are yet set.
