GATINEAU – Independent broadcasters are telling the CRTC that they will lose their spots on the broadcast dial if the Commission decides to eliminate genre protection rules and access rights for certain types of programming because the big Vertically Integrated (VI) media and carriage companies have the incentive to muscle their way in with copycat channels, causing “significant harm to the system.”
Genre protection has been a staple of the Canadian broadcasting system for many years, giving niche services the opportunity a protected space in which to build audience share along with a stable source of subscriber revenue, but also to ensure a diversity of programming. In Broadcasting Notice of Consultation 2014-190, the Commission questions whether there is still a need for these protections given “the high degree of program sharing” now going on among services.
Some independent broadcasters and content providers argue that indeed genre protection rules are still required because the VI companies have the content expertise to launch similar channels and because of their wide distribution they can package channels in a way that is detrimental to independent services. The Independent Broadcast Group (whose members include independent companies Channel Zero, Ethnic Channels Group, Hollywood Suite, Fairchild Television, Stornoway Communications, Out TV, Stingray Digital, Superchannel, and Zoomer Television) is one such organization that says genre protection must remain to buttress their battle against the dominance of the VI firms.
“Each of these large companies is in the position to outbid independent programming services for the most popular programming and to launch their own competitive service. This has already happened in the Category B environment with certain popular genres of programming developed by independent programming services,” argues IBG in its intervention.
It does note, however, that in some cases an argument could be made for the removal of genre protection. IBG points to news as an example. But the CRTC should continue to evaluate this on a case by case basis rather than removing genre protection across the entire system.
The owner of The Weather Network and MétéoMédia agrees with IBG that genre exclusivity needs to remain in place to protect independent broadcasters from the might of the VI companies. Pelmorex points to assertions in a Wall Communications report (Appendix A here) commissioned by IBG and Pelmorex to support its argument.
“Without genre protection, vertically integrated BDU/broadcasters can move into genres occupied by independent services that the BDU/broadcasters perceive to be the most attractive and similarly package those services in a more favorable manner in comparison to the independent service, further disadvantaging the independent service,” says the Wall report.
Most in the industry recognize, just as the CRTC noted in its consultation document, that there has been a blurring, if not full erasure when it comes to some programming decisions, of the genre lines. They suggest other mechanisms to protect independent services while allowing for greater genre flexibility.
“True exclusivity in programming genres is no longer present.” – Blue Ant Media
Independent broadcaster and producer Blue Ant Media argues that “true exclusivity in programming genres is no longer present” with audiences able to find their desired content on a number of different channels. In this vein, the company suggests a different approach could provide Category A services with the protections they need but also allow the Commission to remove genre exclusivity provisions.
For example, if an independent service has 25% penetration now, the BDU would be required to maintain that level. If penetration dropped to 15%, wholesale fees would be paid as if penetration was 25%. If it rose to 30%, then wholesale fees would rise to 30%, but if penetration grew to 45%, then the BDU and the independent service would be able to “negotiate a creative and flexible wholesale fee adjustment.”
The Canadian Media Production Association (CMPA) acknowledges that benefits could accrue to the system from greater genre flexibility such as increased revenue, more spending on Canadian productions and higher quality programming. However, it admits removing genre protection could lead to more program sharing, particularly those larger broadcasters with more spending flexibility under the Group Licensing Framework, and “a dearth of programming” for many genres. The CMPA added that could lead to lower production and broadcasting of new, original programming.
The “race to the middle”, a shift in content to appeal to the broadest audience possible which is sure to happen with some channels if granted relaxed conditions of license in their genre, means the Commission will need to impose rules on the VI companies to ensure historical spending levels in the areas of children’s programming, Canadian theatrical films and documentaries are maintained.
“In exchange for genre flexibility, the large broadcaster Groups should be required to allocate minimum set percentages of their required PNI spending to children’s programming.” – CMPA
“In exchange for genre flexibility, the large broadcaster Groups should be required to allocate minimum set percentages of their required PNI spending to children’s programming, Canadian theatrical feature films and Canadian documentaries,” says the CMPA, noting that the details could be established as part of the 2016 group licensing renewal process.
Broadcast distributors argue that the race to the middle either won’t happen, as suggested by Rogers Communications, or is “overstated,” according to Cogeco Cable. “With hundreds of channels to choose from, every channel is motivated to deliver unique and appealing programming to viewers regardless of genre,” says Cogeco. “Moreover, genre exclusivity provides no protection at all from the greatest threat to traditional television programming, namely the availability of rich content on unregulated platforms.”
Other arguments suggest that the experience south of the border reveals that channels won’t abandon their brand entirely just to get a larger/broader audience share.
Corus Entertainment says some niche channels are likely to add content they didn’t already carry to broaden their reach. But they won’t make a wholesale switch to other content because the “inherent branding, programming and consumer confusion costs” wouldn’t make sense in the majority of the cases, the company adds in its intervention.
This is the seventh story from our ongoing, summer-long breakdown of the official submissions made to the CRTC for it's Let's Talk TV, TV Policy Review. The first six are linked below.
Is basic bloated? Does it need a diet?
Pick and pay in Canada strikes out with U.S. media heavyweights
U.S. border stations want to use Let's Talk TV to wrest cash from Canadian BDUs
Should Yankee go home? The changing role of U.S. channels in the Canadian broadcasting system
No “Netflix Tax”, company warns CRTC
Snap Judgements: Everyone wants more choice – tied to a lot of ifs, ands, buts…
