ANOTHER ROUND OF LAYOFFS has led inexorably to another spasm of handwringing, navel gazing and a week of “what are we going to do about the CBC?” The reactions have largely been predictable, eye-rolling and boring – generally a waste of everyone’s time.
It was shocking when last Thursday’s big town hall meeting called by CBC leadership turned out to be, for the most part, just about cutting the public broadcaster’s head count yet again – with a vague promise about a new vision for the pubcaster to come sometime before the summer. Many honestly believed that a vision of where its leadership believes the CBC needs to go would come before – or along with – a large round of cuts because the 657 positions axed last week are by no means the end of them.
The CBC leadership knows this. In fact, sources who asked not to be named have told us the CBC board of directors wanted CEO Hubert Lacroix to cut far more than he announced last week, but that instead he only wanted to trim just enough to make it through the next year. “What we announced today had one purpose and one purpose only: To balance the ’14-’15 budget,” he told reporters in the press conference held last Thursday afternoon. That says to us more job losses are inevitable.
If what we’re hearing from the private broadcasters about the permanent-looking shift of many millions of advertising dollars away from conventional TV broadcasting holds true, then the CBC’s announced cuts last week won’t be enough to even make the 2014-15 budget work, let alone free up enough resources to overhaul the place for the future.
“I’ve never seen it like this,” one leading private broadcaster salesperson who spoke to us about the current ad market on condition of anonymity. “If this isn’t cyclical, we’re all in big trouble.”
Indications are that the ad downturn being faced by traditional media companies which started before Christmas 2013 is not something that will get better (ask newspaper owners about this). Instead, the belief is growing that it’s part of a massive, irrevocable shift in ad spending now under way around the world as companies deploy their marketing and communications cash in other places and in other ways.
“Advertising on conventional is declining rapidly. Last year it declined 6%. This year has a similar trend and it is not cyclical. This is a structural change as advertising dollars migrate to digital opportunities.” – Keith Pelley, Rogers Media
“It’s shocking how dramatic the industry has changed since our last renewal and it has happened so, so fast. It's not changing yearly, it's not changing monthly, weekly. It almost seems like it's changing daily,” Rogers Media president Keith Pelley told the CRTC during his company’s license renewal hearing last week. “Advertising on conventional is declining rapidly. Last year it declined 6%. This year has a similar trend and it is not cyclical. This is a structural change as advertising dollars migrate to digital opportunities.”
Of course, Pelley may have been overselling the negative because of the more lenient conditions of license the company is seeking from the Commission. So, at the other end of the scale last week was Shaw Media president Paul Robertson, who was speaking to financial analysts last Thursday after the company reported its second quarter results. Keep in mind Robertson would be trying to be as positive as possible: “There’s no question we’re seeing a shift across the various platforms in terms of where the audiences are trending – and consequently where the advertising is showing up – and conventional television is under the greatest pressure,” he said last week.
“It’s under pressure because of the shifts in the way in people consume news, for one, where they are getting news more on a 24/7 basis through the internet, and that’s causing a reduction of audiences on the major broadcasts. Then, there’s no question as we see new competition coming that’s unregulated (over-the-top video)… we have longer term concerns as it relates to pressure that that puts on our business – the strength of Google which is making deals on a worldwide basis with some of our customers. So these are some of the competitive impacts that we are dealing with.”
The thing is, Shaw, Rogers and Bell have other levers to pull to help themselves, many other ways to produce revenue which the CBC does not. The vertically integrated Canadian giants have specialty channels serving very popular niche markets, live professional sports, digital and mobile options like TV Everywhere viewing platforms, not to mention their lucrative broadband, cable and wireless divisions. Those companies are built to weather not just storms, but long-term sea-changes. The CBC is not and could never be like the privates. And it is suffering.
However, what the CBC has going for it is something the private broadcasters don’t: Nearly a billion dollars in taxpayer funding – and perhaps it needs to learn how to live with that budget alone and treat any earned ad revenue as a nice surprise instead.
"The public broadcaster is starting to make choices, because it doesn’t frankly, have a choice any more." – Hubert Lacroix, CBC
Lacroix did try to sell his employees and others on his belief that Thursday’s town hall meeting was about more than just cuts. "The public broadcaster is starting to make choices, because it doesn’t frankly, have a choice any more,” he said – which was the sentence which rang truest to us. It is out of time. But, the part about saying the CBC had decided to stop pursuing professional sports was an inversion of reality. Professional sports had left the CBC already. It can no longer afford them and was lucky to have the NHL contract for as long as it did.
“The number two thing, is today’s announcement is about changes, the way we deliver services in the regions. The way that we need to reduce the cost of delivery because right now the revenue line does not support the infrastructure that we have,” added Lacroix. “And then the big questions that are triggered is what we are working on in the context of our 2020 plan is ‘what are we going to look like and what kind of needs will Canadians need us to meet in 2020’ and that is what we’re working on and that is where we’re going to land, we hope, at the beginning of the summer – and that is going to be a re-imagining of a smaller, more focused, more agile public broadcaster.”
Now, famous quotes are a bit of a hackneyed copout in column-writing, but this one, attributed to former U.S. president Theodore Roosevelt seems apt: “In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.”
The time for small measures is over. Doing nothing, or just slapping a coat of paint on the place isn’t good enough. The CBC must act. Now. It must make the tough decisions that need to be made and let the chips fall where they may. If the decisions made cause the politicians to react negatively, then let them. They are in charge of the CBC’s purse strings and the 33-year-old piece of legislation, the Broadcasting Act, which sets its mandate. That may well need alteration and it’s up to the CBC to force the question at this point. It must also be transparent about what it wants to do and why – and it may have to amputate an arm or a leg, or both, in order to save its life.
Keep an eye on this space next week when we offer up some ideas (gleaned from many discussions with folks in the industry) on what the CBC could do to thrive.
And let us ask you: What would YOU do? Let us know in the comments box below or drop us an e-mail: editoral@cartt.ca.
