News

Bloggers and Editorialists React to the TV Tax

The TV Tax issue has been receiving a lot of attention online in the past two weeks. Here is a small selection of articles the broadcasters don’t want you to read.

The Soo News tells readers that the broadcasters are not telling them the whole story:

They claim if rewarded with the fee for carriage, it will ensure local tv remains on the air. Trouble is, local tv stations have been closing across the country well before the current economic crisis. Furthermore, the Networks have not guaranteed the money would be funneled back to local programming. The Cable companies claim the new money will only finance more American TV programs. The staple that has built the Canadian TV networks since the 1960’s.

Source: http://www.soonews.ca/viewblog.php?id=22707

Canadian, Eh! explains that the TV Tax is a money grab by the broadcasters, who have not adapted to the changing business environment:

This fight pertains to whether the cable guys should be paying the networks a fee for broadcasting the basic local television channels. (Or something close to that!). The cable guys charge their consumers a fee for viewing these channels as part of their “Basic” package. Makes sense. They have to get that programming to the consumer using their equipment, and service that equipment when required.
It all boils down to a money grab, in my opinion, on behalf of the networks. With the onset of technology – YouTube, Apple TV, iTunes, etc. – a lot of people have found other ways to view their favourite television programs and movies and subsequently ad revenues have taken a nose dive for the networks. Being a little slow in catching up, the networks have found themselves in a quandary as to how to increase profits and maintain their viability. If this was such a thorn in the side of the networks why didn’t they ask for this fee over 40 years ago when cable was in its infancy??

Source: http://livingincanada.wordpress.com/2009/10/14/the-big-debate-networks-v-cablesatellite/

Blogger Werner Patels argues that instead of asking for a TV Tax, the broadcasters should pay cable and satellite providers for distributing their signals to a larger audience:

Canadian broadcast networks – CBC, CTV, Global and CityTV – would instantly lose at least 70 to 85 percent of their viewers if cable companies were to drop them from the line-up. Or, put differently, the cable-TV companies provide the backbone of the broadcasters’ transmission and distribution infrastructure. Except for the guy sitting directly on top of or underneath a broadcast tower, most Canadians would not be able to see any of their homegrown networks and programming if it were not for the cable companies making them so easily accessible.

Losing basic cable carriage would mean sudden death for all Canadian broadcasters (including the CBC). In fact, the broadcasters should be paying a fee to the cable companies, instead of the other way round, as no Canadian network would be viable without cable.
Source: http://www.wernerpatels.com/2009/10/local-tvs-dirty-little-secret.html

After spending an evening watching CTV, one blogger questions just how important local television really matters to CTV:

I saw one commercial on CTV last Thursday that was basically a full-length music video (well… country music) about how the big cable companies are going to kill local TV ending with the message that we all should support local TV stations and local TV shows. It was quite powerful. Or rather, it would have been had they found a slightly better time to play the ad…

See, they played the ad at 6:57pm. At 6:56pm, at the end of the news, they played their full Thursday night schedule. It looked like this:
7PM – The Vampire Diaries
8PM – CSI
9PM – Grey’s Anatomy
10PM – The Mentalist
11PM – CTV National News
11:30PM – CTV Local News
12:00AM – The Daily Show with Jon Stewart
12:30AM – The Colbert Report

Of those shows, only the local news is, well… local. 30 minutes of their 360 minute prime-time evening is local. 60 minutes are Canadian. The next closest is ‘The Vampire Diaries’ in that one episode was shot in Vancouver (then relocated to Atlanta).

CTV – way to not only say that local TV doesn’t really matter, but also that ‘big cable companies’ are far more entertaining. Kudos.

Source: http://puddingstore.livejournal.com/39489.html

Monte Sonnenberg of the Simcoe Reformer also questions the broadcasters’ sincerity, adding that Ottawa should not accept a TV Tax since it is nothing more than a band-aid solution:

The major broadcasters are being insincere when they say that cable and satellite providers earn enough to absorb any surcharge. Someone needs to tell the broadcasting community that – even though Canadians are avid television watchers – that doesn’t necessarily mean they are stupid. Rest assured – every penny levied as fee for carriage will be passed along in its entirety to subscribers. This is simply how business works, and this is what the bug broadcasters are really proposing. Should Ottawa go for it? No. New media and the increasing fragmentation of the audience is changing the broadcast landscape so quickly that the local station business model is irretrievably broken.

Source: http://www.simcoereformer.ca/ArticleDisplay.aspx?e=2126712

Matermaq.ca shares that sentiment, writing that the TV Tax is:

..not going to solve all of [the broadcasters’] financial troubles. It’s more of a stop-gap solution. They’re still going to lose money and viewers. Isn’t it time to rethink the strategy? Focus energy on something constructive?

Source: http://blog.mastermaq.ca/2009/10/08/local-tv-matters-vs-stop-the-tv-tax/

Finally, Steve Faguy expressed frustration last week with CTV’s coverage of the broadcasters’ news conference, and suggested that CTV owes its viewers an apology:

It doesn’t matter whether you agree with CTV’s campaign, or with fee for carriage, or that local TV is in trouble, or that cable and satellite companies are making too much money. CTV News has a duty to represent a fair picture to its viewers, and it is intentionally failing to do so.
This is what you want us to save?

Source: http://blog.fagstein.com/2009/10/08/ctv-local-tv-press-conference/