The CRTC has failed to protect the Canadian broadcasting industry - The Globe and Mail


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CRTC's Failure to Protect Canadian Broadcasting

Richard Stursberg, a former executive in Canada's broadcasting industry, criticizes the CRTC's handling of the broadcasting system's decline over the past decade. He points to the significant financial losses faced by Canadian private TV networks, due to advertising revenue migrating to tech giants like Google, X, and Facebook.

Challenges Facing Canadian Broadcasters

  • Loss of advertising revenue to digital platforms.
  • Increased competition from American streaming services like Netflix, Amazon Prime, and Disney+.
  • Regulatory burdens on Canadian cable TV, leading to subscriber loss.

Stursberg highlights the CRTC's slow response to these challenges, citing the slow implementation of a 5% gross revenue contribution from streamers to support Canadian programming, which is currently under legal appeal.

CRTC's Ineffective Actions

The CRTC's recent public process to assess the broadcasting system's sustainability is deemed too slow. The lengthy process for resolving disputes between the cable industry and specialty services further hinders adaptation to the changing market landscape. The author argues that the CRTC's focus on bureaucratic processes prevents timely and effective solutions.

Existential Threat to Canadian Identity

The article concludes that the CRTC's inaction poses a significant threat to the Canadian broadcasting system and consequently, Canada's cultural identity. The author emphasizes the urgency of addressing the challenges facing the industry to maintain a distinctive Canadian media landscape.

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Richard Stursberg is the former head of English services at the CBC, former executive director of Telefilm Canada, past CEO of the Canadian Cable Television Association, past chairman of the Canadian Television Fund, and former assistant deputy minister of culture and broadcasting.

The Canadian Radio-Television and Telecommunications Commission (CRTC) is the federal body responsible for ensuring the health of the Canadian broadcasting system. Over the last 10 years, it has failed.

These are the facts: The CRTC has known for more than 10 years that the big private Canadian TV networks have been losing money – more and more every year. These private networks are the bedrock of local and national TV news, and Canadian drama and public-affairs productions.

They, like the newspapers, have seen the advertising revenues that used to finance Canadian shows migrate to Google, X and Facebook to pay for algorithms and disinformation. As a result, Canada now suffers from many local “news deserts” across the country.

The CRTC also knows that the cable TV business faces significant challenges. The industry has been losing subscribers since 2014 while shouldering a myriad of regulatory obligations that require it to carry and pay for a broad range of Canadian specialty TV channels, such as the Documentary Channel, Treehouse and MuchMusic, regardless of market demand.

Opinion: Economic dependence on the U.S. means a loss of cultural sovereignty

Cable TV is losing subscribers because of the entry of American-owned streamers – Netflix, Amazon’s Prime Video, Apple TV+, Disney Plus – into the Canadian broadcast market. The CRTC knows that these services have been in Canada for more than 12 years. Despite the Broadcasting Act’s requirement that all broadcasters be Canadian-owned and make Canadian shows, it has let these American streamers operate unhindered. They remain completely unregulated, bearing none of the burdens of the Canadian-owned broadcasters to provide Canadian news and entertainment.

The CRTC has known all this for more than a decade, and yet it has done almost nothing.

A couple of years ago, the commission appeared to have started to awaken from its slumber. In 2023, it initiated a proceeding to look at the role of the streamers and the definition of “Canadian content.” Two years later, it instructed the streamers to pay no less than 5 per cent of their gross revenues toward supporting Canadian program production (major Canadian broadcasters have to pay as much as 30 per cent). The decision has been appealed to the courts and nothing has been paid yet.

More recently, the CRTC began a public process to “ensure the sustainability and growth of Canada’s broadcasting system.” It asked interested parties to file their proposals on what to do to find this growth, and asked them to answer between 50 and 60 very detailed questions ranging from the important to the picayune. A decade after the system ran into serious difficulties, the first hearing on it was held this week, with others to follow in June and September. Canadian businesses will be lucky to know their new obligations by 2026.

The CRTC’s dilatory behaviour extends beyond the major policy issues to operational ones as well. As the cable industry tries to restructure its programming offerings to compete with the streamers, it inevitably falls into disputes with specialty services. There are now many of these disputes being considered publicly before the commission. Typically, they take 18 months to two years to resolve. It is impossible to see how the cable industry – or the specialty services – can adjust to the new competitive environment when they cannot get timely decisions on matters that are fundamental to their businesses. Without significant regulatory relief, it will be almost impossible to meet the competition from the American streamers.

There is something deeply wrong at the CRTC. It does not seem to understand that the most important cultural industry in Canada faces major challenges. It seems more preoccupied with processes designed to delay decisions and avoid controversy than solving the problems at hand.

With Donald Trump as the new U.S. President, the CRTC’s dithering has compounded the existential crisis facing Canada. If we cannot ensure the health of the Canadian-owned broadcasting system, it will be very difficult to maintain Canada’s distinctive identity.

As the CRTC fiddles while our media outlets burn, all Canadians are paying the price for its failure to act.

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