Opinion: Battle of the greedy TV companies?

If Canada’s television giants have their way, many viewers will probably pay even more than they do now to watch their favourite TV shows.

The commercial TV companies, such as CTV, contend they are fighting a life-or-death battle to “save local TV.” But their critics charge that what these companies are really fighting for is to get the public to pay for channels that have previously been available free.

Until now, commercial TV companies made their money solely from advertising. With a downturn in advertising, they are short of cash. And so they want the public to contribute to the cost of programming.

OBJ360 (Sponsored)

Local TV – nightly programs such as Max Keeping’s supper-time news hour on CTV – are most threatened because they are relatively expensive to produce and have a small audience, compared with CTV network programs shown across the country.

What the TV companies are seeking is a share of the huge revenues collected by cable and satellite companies that deliver television signals.

It’s difficult for the public to get worked up about a battle between giant TV companies, in one corner, and giant cable and satellite companies in the other. But we should, if we want the federal government regulator to think of the public first in adjudicating this fight.

Full-page newspaper ads by the two sides illustrate how far apart they are. One, from the TV companies, claims “overwhelming, unprecedented support for local TV.”

Yes, the public supports local TV, no doubt. But that’s very different from being prepared to pay higher cable or satellite fees to see Max Keeping every night.

The TV companies’ ad also says local TV stations should be allowed to negotiate with cable and satellite companies for a fair market price for their signals. There’s nothing wrong with that, but any cost paid by cable and satellite companies would be an additional cost for consumers.

The ad from the cable and satellite companies, on the other hand, is contemptuous of the TV companies. It says: “At the first sign of sagging ad sales, they’re willing to dump their local stations to protect their huge profits. Unless, of course, all cable and satellite subscribers pay them a tax of up to $10 a month. Even then, they won’t promise this money will support local programming or even keep your local TV alive.”

No one knows whether that possible figure of $10 a month on cable and satellite bills will come to pass. Regardless, it would not be a “tax,” as the cable and satellite companies claim. It would be a fee to be deposited into the pockets of TV companies.

What’s wrong with this picture? You end up paying CTV to deliver CTV’s product to CTV’s customers?

Surely it should be the other way around?

For years, TV companies were only too happy for cable companies to deliver their signals at no cost. More viewers meant higher advertising rates for the TV companies. They still do.

An example of how things usually work, only in the print realm: Ottawa Magazine, a glossy periodical, pays the Ottawa Citizen thousands per issue to distribute the magazine free with the newspaper. This represents added value for Citizen readers, for which the Citizen gets extra revenue. Yet Ottawa Magazine finds the cost worthwhile since it’s cheaper than using Canada Post, says publisher Dianne Wing.

For consumers’ sake, let’s hope for a compromise solution to the battle between TV stations and the companies that deliver their product to our living rooms. One that I like has been suggested by Michael Geist, who holds the Canada Research Chair in Internet and E-commerce law at the University of Ottawa.

Two key elements of his proposal are: TV viewers would only pay for the channels they choose; and that commercial TV stations would receive a fee, but only from viewers who elected to receive their signal.

We can only hope the eventual outcome of this messy situation even comes close to making this much sense.

Get our email newsletters

Get up-to-date news about the companies, people and issues that impact businesses in Ottawa and beyond.

By signing up you agree to our Terms of Use and Privacy Policy. You may unsubscribe at any time.