GATINEAU – Having heard nine days of complaints, plaudits and the general direction of questions being asked by commissioners CBC/Radio-Canada committed to air more programs of national interest (PNI), regional French-language programming and children’s TV shows during the reply stage of its CRTC licence renewal hearing which wrapped up on Friday.
Some of the new proposals in French language services include 100 hours of per year of original Canadian programming, a commitment to do its best to reach 10 hours of local production in the Windsor market beginning in September 2013, and a willingness to accept a condition of licence for a minimum of five hours per week on average over the year for programming created outside of Montreal.
On the English language services side, CBC is committing to more Canadian content on Radio 2 (40% of category 2 musical selections will be from an emerging Canadian artist), more local programming and a greater number of hours of programs of national interest (PNI).
With respect to local programming, the Corp. said it heard from interveners who wanted more local non-news programming. It has committed to one hour of this type of programming in six of 14-hour markets. “Unfortunately, we can’t go further than this, said,” Kirstine Stewart, executive VP of English services at CBC.
The public broadcaster is also upping its commitment to PNI, by adding an additional two hours per week, bringing it to a total of nine hours. However, due to the expensive nature of PNI programming, the corporation will not be able to abide by the 75% independent production rule for these two additional hours.
When pressed by vice-chair of broadcasting Tom Pentefountas on this, Stewart said CBC needs to figure out the best way to afford these programs. “The flexibility we’re referring to is not that we don’t anticipate going to the independent production community to produce those two hours, we just don’t know to which level,” she said. “We need the opportunity to be able to look at the best the way to serve those programs of national interest for our audience and see which production method is the best.”
While the public broadcaster has shown its willingness to commit to greater programming levels, CBC will not abandon its position that it needs advertising on Radio 2 and Espace musique. However, it has deviated from its original position of nine minutes per hour of national advertising. It has now proposed a phased-in approach where in the first year, Radio 2 and Espace musique would be limited to five minutes of ads per hour. The second year of the licence would see that jump to seven and then to nine in the third. In the remaining years of the licence, there would be “no restrictions on the number of minutes of national advertising,” according to a document filed with the Commission on Friday.
During his opening remarks, Hubert Lacroix, CBC’s president and CEO, defended the corporation’s position on radio advertising, noting among other things that adding new stations of late has not had a negative impact on existing stations. CBC has presented evidence that shows the positive impact of adding radio stations in each of Vancouver, Calgary, Edmonton, Halifax, Quebec City and Ottawa-Gatineau. “The idea that advertising is a zero sum game and that we would simply take revenues at the expense of existing radio stations is not correct,” said Lacroix, referring to the evidence.
Smaller market radio broadcasters, who set their position the day prior, won’t feel the revenue pinch either from CBC’s ability to sell national advertising on the two radio properties, he said. “These stations derive up to 95% of their revenue from local advertising. These revenues will remain untouched,” he said.
BEFORE CBC TOOK THE STAND for its replies, the commercialization of CBC’s radio services was a major discussion Friday morning. Both Corus Entertainment and Cogeco Inc. noted that allowing advertising on Radio 2 and Espace musique would change the nature of the service and should be denied.
CBC’s plan doesn’t make any sense, noted Yves Mayrand in his opening remarks. “It would simply destroy the very nature and distinctiveness of Radio 2 and Espace musique,” he said.
According to Corus, the public broadcaster’s proposal is not only wrong, “detrimental the CBC listener and to the broadcasting industry as a whole,” but also “completely unnecessary.” Gary Maavara, executive VP and general counsel at Corus, added that the Commission needs to take a closer look at how CBC is commercializing its entire operations. “The fact is that if they are to be a commercial operation that is to be subsidized rather than a public broadcaster, then the matter should be thrown open for a competitive process. The Radio 2 frequencies should be returned and the Commission should call for applications for new ideas to meet the goals of the Act,” he argued.
Under questioning, Corus explained its position on radio advertising more fully. Commissioner Elizabeth Duncan wondered if there were conditions the CRTC could impose on CBC with respect to advertising and could they be enforced. (Over the two week hearing, commissioners asked often of interveners what conditions or rules could be envisioned and applied that would make them happy if the Regulator were to allow ads on Radio2/Espace musique).
Maavara said he believes any conditions wouldn’t work and the CRTC may have difficulty enforcing them in any event. “The CRTC’s conditions process is inherently too slow, so our view is that conditions would not be appropriate whether it be for the CBC or anybody else,” he argued. “In terms of the alleged potential abuses of which we think there are many, we don’t think they would (be effective) in curbing that either.”
Maavara also noted that including advertising would significantly change Radio 2 and Espace musique and CBC wouldn’t be able to hold such developments back. “You can’t be half pregnant with commercialization,” he said, adding the CBC would have to live with the fact that listening would change because it’s handing off air time to third parties for those ad messages.
To illustrate the potential impact, he told the story of a recent experience watching CBC News Network where a promo for a news item was followed by two ads: one for software that helps with memory and another on how to avoid going into a retirement facility.
“My point simply is you went from a serious news show to different content and that’s going to happen on CBC Radio 2. I mean roughly one-sixth of their service is changing whether they like it or not from the first second they start being commercial. So there are a lot of impacts of revenue… but it’s going to change their service. And we don’t think Canadians want that.”
Look for the decision on the CBC's license renewal early in the first quarter of calendar 2013.
