Perry Hoffman
GATINEAU – Telcos Telus and MTS Allstream are urging the CRTC to remove vertically integrated broadcasters/distributors from eligibility under the Local Programming Improvement Fund (LPIF).
While Rogers, Shaw and Quebecor all want the LPIF program eliminated, Bell Media Inc. is neither for or against continuing the program. However, each have local stations who are collectively getting millions from the LPIF fund.
Ann Mainville-Neeson, director of broadcast regulation at Telus, noted during her opening remarks, that of the large vertically integrated providers, only Bell is clinging to LPIF despite the fact that it could save more than $1 million if the program was eliminated (Bell contributed $25 million to LPIF in 2011 and received $23.6 million).
“Bell is merely using the regime to extract extra rents from consumers, blatantly profiting from a regulatory obligation,” she said. “The other vertically integrated broadcasters would just as soon see the LPIF eliminated and instead fund their own stations directly.”
Mainville-Neeson added that “vertically integrated companies could do well, probably better, at funding their own stations directly rather than going through a public fund.”
Telus changed its position slightly with respect to the eligibility of independent TV stations in non-metropolitan markets. Stations that are profitable should either have their eligibility removed or add incrementality.
“Either we remove them from the eligibility to access the fund or you add some type of incrementality, otherwise we are funding without any direct relation to achieving objectives of the Broadcasting Act,” she argued. “It’s either incrementality or removing funding from those who are simply not in need.”
MTS acknowledged that if the Commission were to determine there is still a need for LPIF, then it should be limited to independent broadcasters, the overall funding available decreased and that there should be a defined phase-out period of three years.
During her opening remarks, Teresa Griffin-Muir, vice-president of regulatory affairs at MTS, questioned the benefits being derived from the LPIF, highlighting the “more or less consistent” average weekly local programming from Bell and the “few minutes per day” increase in local programming at CBC.
“What we’re seeing, but for a very few of these stations, there hasn’t actually been an increase in local programming,” she said in response to a question from commissioner Marc Patrone.
Asked whether the funds are being misused, she was non-committal, but noted there hasn’t been an increase in local programming resulting from the fund. “If we look at that as a measure, then there has not really been a significant increase in local programming as a consequence of the fund,” Griffin-Muir argued.
Patrone wondered aloud then if consumers had been cheated.
“I don’t know if consumers have somehow been cheated. Do I think it’s a good use of the money? No, not necessarily. But I also think we’re looking at it from the perspective of is there a need for a subsidy and is this subsidy appropriate under the circumstances. And we would say no, there is no need for a subsidy,” responded Griffin-Muir.
Telus suggests that rather than giving money to broadcasters to fund over the air television, they should be looking at alternative means of giving their customers local programming. Mainville-Neeson pointed to news over specialty channels or news apps on tablets as examples.
“Now that’s not to say that we believe that local television should be abandoned. Absolutely not, it has a role to play,” she said. “But that role may be changing and the Commission should recognize that consumers may choose other options and that we shouldn’t be continuing to subsidize that which consumers are no longer following.”
Tele Inter-Rive ltee joined other independent broadcasters in lauding LPIF, describing it as “an outstanding form of support” for its four local television stations and “given our stations the opportunity to improve and increase their local programming.”
Tele Inter-Rive, which covers a vast territory going from the Lower St. Lawrence to Gaspe and northern New Brunswick, says it now broadcasts more than 32 hours of local programming per week.
The Canadian Association of Community Television users and Stations (CACTUS) criticized LPIF for excluding community television from the funding scheme. Catherine Edwards, appearing on behalf of the association, said that independent community broadcasters need money but have been denied access to funding at every turn. “These oversights have crippled growth in the sector, and is a grave loss to the system given the efficiency of the community model,” she argued. “While an hour of production by a conventional broadcaster costs on average of $6,093, it costs a community broadcaster less than $805.”
Conditions for LPIF funding would be: the employment professional journalists to guide the production of local content and the production of at least five hours of local programming per week. The association calls for funding on the order of one sixth that of conventional broadcasters for a total of about $2 million.
