Source: Winnipeg Free Press

Specifically, this showdown that is being portrayed as a life-and-death struggle over the very existence of local television stations in Canada's cities and towns is actually a much simpler question of who's going to get their hands on how many of the billions of dollars generated by this country's government-regulated TV industry.

How this primed-for-prime-time drama plays out could end up costing Canadian television viewers dearly. Or, perhaps, not.

And the outcome depends far less on how effective the current murky wave of attack/counterattack campaigns by broadcasters and cable operators are in winning public sympathy as it does on how convincingly each side has been able to argue to the federal broadcast regulator that its cause is the just one.

The battle lines are clearly drawn.

Television, radio and print advertising by both sides has been incessant -- though, thanks to its cacophonously contradictory nature, nowhere near illuminating -- during the past few weeks, as the clock ticks down to the next round of Canadian Radio-television and Telecommunications Commission hearings.

The arguments, in a nutshell, are these:

Conventional broadcasters -- the traditional major-network entities, CTV, Global, Citytv and the public broadcaster, CBC -- argue that the business model they've employed for decades is broken. Market fragmentation (hundreds of channels, as opposed to the handful four decades ago), diminished advertising revenue, increased costs and the broader economic collapse that occurred last year have rendered conventional broadcasting unprofitable. The networks that used to haul in cash by the truckload are now actually losing it in measurable amounts.

(Before you start feeling too sad for the nation's big broadcasters, consider that they've spent the past decade acquiring most of Canada's specialty channels, which remain exquisitely profitable).

Looking for ways to fix the broken conventional-TV model, they focused their attention on the fact that cable companies (and, to a lesser extent, satellite providers and telephone companies that dabble in the TV-delivery business) have never paid a fee to the conventional broadcasters for including their networks in the channel packages they deliver to their customers for a (basic-cable) price.

They pay such a fee -- in TV-industry parlance, a "fee for carriage" -- to Canadian specialty networks (most now owned by the broadcasters), and to the imported U.S. channels they carry in their cable packages (this wasn't always the case; for years the cable industry basically plucked the U.S. nets' satellite feeds out of the ether for free and then sold them to Canadian consumers, until the U.S. television industry flexed its muscles and set things straight).

But CTV, CBC and Global have never received a dime from cable companies for the content they produce and provide. They want the CRTC to allow them to negotiate a new arrangement, perhaps one that would require the cable companies to start paying a fee for carriage, maybe 50 cents per subscriber.

The cable companies, not surprisingly, aren't thrilled by the notion. They love making money. They're good at it. And there isn't a charge they aren't willing to pass on to their customers to guarantee that it keeps rolling in, always in larger volumes than before.

A practical application of the cable industry's approach to profit-taking occurred right here in the Winnipeg market in the mid-'90s, when Videon, one of the companies that split the local cable monopoly at the time, was denied a basic-cable rate increase by the CRTC. Rather than accepting the decision and trying to make do with the profits on hand, Videon barely blinked before announcing an increase in the cost of its specialty-channel package that amounted to almost exactly the price hike it had been denied by the CRTC just days before.

The cable companies have decided to spin the fee-for-carriage suggestion into a spooky yarn that suggests the broadcasters want to impose a tax on your TV, a sudden and unwelcome new charge of up to $10 a month that will result in what Shaw Cable's recent newspaper ad calls a "$450 million handout" to the broadcasters.

This simply isn't true. What the broadcasters are asking is that the cable companies pay for the local channels they distribute, preferably by simply reducing the cable companies' profits by the amount of the fee for carriage. Cable companies won't entertain such a notion, and have declared they would pass such a fee-for-carriage charge directly on to their customers.

Calling it a tax is akin to the assertion that President Barack Obama must surely be, on the basis of his middle name (Hussein), a Muslim, a terrorist, or both -- it's a strategic massaging of coincidental facts into a statement that, while unsettling enough to create exactly the kind public anxiety it's intended to, is patently false.

No one wants to tax your TV. But the cable companies want you to know that if a charge is imposed on them, a charge will be imposed on you.

Perhaps it's a sign of how seriously they think the CRTC might consider the fee-for-carriage issue this time around -- it has rejected the broadcasters' request for one twice before, but now seems more inclined to listen -- that the cable companies have mounted such an aggressive, costly and emotionally charged campaign to win public sympathy going into the next round of hearings.

And there's the rub: sympathy.

What this public-relations skirmish amounts to is very rich folks fighting with other very rich folks.

Given the billions both sides have reaped for decades by being part of what amounts to a very exclusive government-endorsed club, it's hard to feel very sorry for either side in this dispute.

But fee for carriage is not a tax. It's a reasonable proposal that would require one side to become only slightly less obscenely profitable to provide some small relief to another side which is not quite as obscenely profitable as it once was.

© Winnipeg Free Press