CABLE OPERATORS STILL (privately, mostly) grouse about the 10-cent fee increase the CRTC granted the Aboriginal Peoples Television Network last summer.
As reported by www.cartt.ca, the Commission granted APTN its license renewal on August 31st, and along with that, boosted the fee pass-through from 15 cents to 25 cents per sub per month. That’s a lot of extra money (over $12 million more).
While the distributors soft-pedaled their opposition somewhat and didn’t raise much of a stink when the decision was made public because it’s a bit of a political hot potato, their message was clear: They didn’t think APTN was worth $30 million in wholesale subscriber fees.
But, the Winnipeg-based broadcaster faced unique start-up hurdles when it launched in 1999 and APTN president and CEO Jean LaRose freely admits the channel’s leadership at the time tripped hard over them. For example, facing a dearth of Aboriginal producers and having little broadcast experience, the early leadership overspent and under-delivered on programming. It couldn’t follow the example of other existing channels, which purchased hours and hours of foreign programming, because precious little Aboriginal programming even existed and producers of such content were few. Plus it has a 75% Canadian content mandate and about two dozen languages to broadcast in.
Times have changed, though. APTN is a far better channel than it’s ever been, and will only improve as the new funds roll in. The number of producers has climbed (thanks to the network) and the skill sets of those at APTN have grown tremendously. Recent ratings improvements reflect the changes. Sure, they’re not American Idol numbers, but they are trending up.
For the week of November 21, 2005 APTN’s average weekly reach (Mon – Sun, 2 a.m. – 2 a.m.) in English Canada was 2,473,000 viewers and in French Canada: 586,000 viewers, bringing the total to 3,059,000 viewers. As of December 22, 2005, the average weekly reach in Quebec is 695,000 viewers. (based on the average between Nov.21st and Dec. 18th. ) Results per week (from BBM, courtesy APTN) show that it’s improving every week, rising in Quebec to 776,000 during the week of December 12th.
So just what is APTN doing with its new revenue and new ratings growth? Cartt.ca editor and publisher recently chatted with APTN CEO LaRose to find out. What follows is an edited transcript.
Greg O’Brien: Now that we’re months from the fee increase decision, and the opposition of the fee increase by the cable operators, I guess the question is – and it’s one I’ve heard from them – what are you doing with the additional money?
Jean LaRose: I think we were pretty clear in our dealings with the CRTC is that money is going primarily to programming, roughly seven of every 10 cents. That’s the one area where APTN needs the revenue. One of the challenges we face as a network is we have the same conditions of license as any other network with priority programming and everything else, but the way the system is set up with ratings and various (Canadian Television Fund) envelopes for English and French access to funding, we don’t have the same level of access, if any, to the key envelopes.
So, we have to find other sources of revenue to help us meet our license requirements to meet the audience expectations and I think if the cable operators start looking at our numbers, they’ll start to notice there are quite a lot of Canadians who are tuning us in regularly.
We now have over three million viewers per week who are non-Aboriginal, of which one-third are in Quebec. It’s a fairly substantial audience and when you look at some of the other networks in the same group as we are when (distributors) group us as a specialty… we’re nowhere near Discovery, but we’re third or fourth down from Discovery, so obviously, there is an audience out there for our programming and that’s what the money is for.
Our children’s programming is very popular, Our viewer relations line keeps hearing from parents who say “the children’s programming you have is excellent. It’s not the digitized violent stuff that other networks offer. It teaches values and good life stories… It’s the only kids programming we allow our children to watch.”
So, as cable operators, I suspect they’re probably having more people tune us in than they realize and it’s probably good for their business.
GOB: APTN had its problems at launch with programming and other things. Have those been dealt with now?
JL: APTN has turned the corner from when we launched. We went from zero to 100 in a few months and that was a challenge so our first two or three years – in our quest to get programming – sort of left us in a bit of a tough financial spot. We cleaned that up – pre-increase – and we’ve got our finances back in order and any cable operator or anybody out there wants to look at our financials, they’re on the web site.
We pretty well paid back the debt we had and we’re now in a position to work with more producers to start securing more new programming to meet the audience’s expectations.
We’ve really worked hard both from the board level down to management and staff level to get everything in order to clean up our act and get organized and proper policies and procedures and everything else in place.
GOB: I think part of the issue at launch is that APTN was committed to doing Aboriginal programming by Aboriginals, but there really wasn’t an Aboriginal production community out there to speak of.
JL: That’s exactly the fact. When we launched there was nothing there for us to (purchase). We were showing repeats of The Forest Rangers from the ’60s or something. There was very little programming. We now have an aboriginal production community of 60 to 70 active producers who are now all striving to produce programming for us and in fact, that’s what the fee increase is for. It allows us to turn to more of them to provide us with different kinds of programming – drama for example.
It’s tremendously expensive to produce and with the current envelope system, we’re worried that we’ll have trouble triggering the envelope for even one drama series in the coming year to satisfy our license conditions. That 10 cents, when you look at the average monthly bill, is a drop in the bucket, but it’s a drop that, to us, allows us to keep doing what we’re doing.
GOB: What’s your most popular programming right now?
JL: We have a few programs doing very well. Our national newscasts (at lunch and dinner times) are getting good numbers. One of the things people love with us are the movies we offer in the evening.
But we also are getting more and more viewers of our Aboriginal language programming with English subtitles. That audience is increasing, We also have very good numbers for shows of a different nature like some of the live entertainment series we have created.
GOB: In how many languages do you offer programming?
JL: We’ve broadcast up to 23 languages. On average, at any point in time, we probably have up to 15 Aboriginal languages a year but we’re working to increase that number over the next seven years.
Again, it’s something that’s expensive to produce because we’re the only ones doing it and for one market.
GOB: And you’re on your own, too, because there isn’t an Aboriginal production community of any size in the States to call on either.
JL: That’s right, there’s none and in fact they’re turning to us to get help to start building their own network. There are a lot of expectations on APTN and it’s very hard to meet all of them.
GOB: Aren’t your Cancon requirements higher, too?
JL: We’ve left them higher. We’re very proud of the fact that 88% of our (schedule) is Cancon, which is the highest of any network, except for maybe the all-news channels like Newsnet. Our license requirement calls for 75%, but we’re still at 88.
GOB: Have you been able to sell APTN and its concept to national advertisers?
JL: That’s been a challenge. Obviously, advertisers and media buyers look at the ratings and if you have the numbers, fine, if not, then good-bye. The problem we’ve faced is that in the past, and still today, our audience isn’t really measured. The numbers we have right now are of secondary audiences. We really can’t measure the Aboriginal audience because none of the ratings systems go into reserves or into rural areas or the north.
While it’s been a challenge, the fact that we have as a secondary audience quite a level of growth in the past year-and-a-half, is slowly starting to be of interest to advertisers. They’re starting to look at the fact we do have a national audience – considering that anywhere from 25 to 30% of our audience in any given week is from Quebec and the rest is spread out pretty evenly across the country, based on the BBM measurement.
Now, all of a sudden, people like Tim Horton’s and others who have tried us, find it’s working for them, because they are coming back.
It is a tough sell, because we wouldn’t have the numbers of a Desperate Housewives, but on the flip side of the coin, when they look at specialty buys, as our audience grows and as we edge up in the field and get higher and higher among the others, we’re looking more and more like an attractive buy.
GOB: Is channel placement, your position on the dial, still an important issue for you?
JL: It is for analog customers. We’re on the nosebleed section of the dial, from mid-sixties up to the 80s now in some areas. So, for everyone who doesn’t have a digital bundle and who doesn’t go beyond the snow of the 30s and 40s (on their analog TV), their chances of finding us are slim.
That means we have to market ourselves more to Canadians so they can find us and the CRTC recognized that challenge.
In some areas and some communities where we’ve had better channel placements, those cable operators have told us that a lot of their customers watch us – and many of those are smaller cable operators. What that shows is given a good placement, we do find an audience and it benefits everybody.
Certainly from ExpressVu’s point of view, they certainly see APTN as value-added to what they’re doing because they’re the only ones who have agreed to put both our feeds on their satellite… and starting this winter, (the two feeds) are going to become more and more different to better-reflect the north and the south.
GOB: Right, because you have a north-south feed and not east-west.
JL: That’s correct. But, the CRTC has now given us permission to split our south feed into an east-west, which we will have in about a year or so.
GOB: Do you still operate the Television Northern Canada broadcast operation?
JL: TVNC doesn’t exist anymore. It has become APTN. But, we still have the transmitter towers up north – and now we’re looking at a replacement program because these have outlived their life expectancy. They’re also part of a government program which will be a set up at some point, possibly in the near future. So, we’re working with the Department right now to find an alternate means of distributing our signal, probably in partnership with cable operators in the north and DTH companies.
To date, ExpressVu has shown interest in the program and we’re not sure if Star Choice will participate or not.
GOB: How have you changed the marketing of APTN. You touched on it earlier, but what specifically have you done differently?
JL: Our audience marketing is really targeted on things like bus shelters and the smaller newspapers – the ones that reach into our communities. We’ve maintained that, and it has proved useful.
Right now, a lot of the marketing that we’re trying to do is through affiliate relations with the distributors to try to maintain a good relationship with them. While there was some reaction to the 10-cent increase, I believe that over the years, we have worked to build a good relationship and I think it’s solid. We want to maintain that and to keep marketing ourselves that way.
For example, Rogers has agreed to move us from the religious theme to the entertainment theme with Discovery and others. That’s the type of thing that will make a huge difference in our audience numbers because people who tend to go to those networks will find us along side them when they get their digital bundle.
Part of what we’re doing is not only are we marketing ourselves to our audience, we’re also really working with the industry to build a relationship and show there is a very strong audience out there for the product.
