TORONTO – The speed at which change arrives and is being forced on everyone in the media space is still so breathtaking that hard and fast answers on what we must do today, tomorrow and well beyond are still pretty elusive.
After listening to some strategy, regulatory and technical sessions at this week’s annual Canadian Broadcast Distribution Association conference (formerly the Canadian Satellite Users Association), those were my conclusions, anyway.
The last 12 months have born witness to four large mergers: CanWest now owns Alliance Atlantis; CTVglobemedia runs the former CHUM channels; Rogers has Citytv; and Telesat got together with the Public Sector Pension Investment Board and Loral Skynet to become the fourth-largest satellite company in the world, moving towards becoming a global player, and is no longer owned by Bell Canada.
Still ongoing is the privatization of Bell itself, the biggest ownership transfusion of all, valued at $52 billion, including debt.
M&A activity is all well and good, because larger companies are probably a good idea to gird Canadian media against an ever-growing hurricane of unregulated media from all around the world.
Consolidation is “just a normal, evolving maturation of a business,” said former CHUM CEO Jay Switzer during a panel discussion this week.
While there in nothing inherently bad about fewer, bigger, companies, he said, there are certain things he finds “scary.”
“The protections we have enjoyed… that have ensured great Canadian choices… to live right along side U.S… That’s the part of the business that scares me,” said Switzer, who worries about federal government rumblings about deregulation – or letting market forces rule, as they say.
It’s all well and good to do that but there is a danger Canadian culture could be swallowed whole by unfettered deregulation. “I want Canadian kids to know as much about premiers and Prime Ministers as governors and presidents,” cautioned Switzer.
But, it’s a paradox, really, because while it’s assumed comprehensive deregulation might see Cancon drop precipitously, broadcasters increasingly chafe at having to face competitors who come in on the web – or normal ways – who are not regulated at all.
We’re all in the same (media and video) sandbox, but it’s difficult to play “if only your quarter of it is regulated and the rest is not,” added Switzer.
And, with those unregulated spaces like web and mobile showing the same or similar content as is available on television, often for free, the value of that content drops, added Jim MacDonald, the former WIC president and CEO who just finished acting as trustee of the Alliance Atlantis broadcast assets as it waited for CRTC approval of its purchase by Canwest.
“The idea of exclusivity in programming is quickly going down the toilet,” said MacDonald, “and the value of the programming therefore, is right there behind. Program rights will become a bigger and bigger problem,” because of the multiple platforms from which shows can be consumed.
And while the overall value of the rights dip, “the cost is going up,” he added, weakening the underpinnings of the whole broadcast system.
Switzer was even more pointed, noting that at this point in media’s stages of growth, broadband is the new specialty, specialty is on its way to becoming the new conventional while conventional “may be the new AM radio.”
Ouch.
