Mr. John Traversy
Dear Mr. Traversy:
By the time the CBC renewal hearing takes
place in November, 2012 and the subsequent decision is issued, the period of
time that will have elapsed between CBC licence renewals will be approximately
thirteen years, nearly twice as long as intended under the Commission's
regulatory procedures and practices.
Given the importance of the CBC's role in
the overall Canadian broadcasting system, and in the lives of Canadians, and
given also the fact that the CRTC's public hearing process is one of the few
opportunities for broad public input into, and transparent public scrutiny of,
the CBC's mandate, track record and commitments, this hearing is critical to
the future of our national public broadcaster and its service to Canadians.
In our letter of April 12th,
Friends urged the Commission not to treat the Corporation's proposals to
introduce commercials onto Radio Two and Espace Musique on an expedited basis,
but rather to consider them in the context of the renewal hearings. We were pleased that the Commission
adopted this approach.
We are writing now to address another
critical procedural and substantive issue connected with this important renewal
In its recent decision to further postpone
the renewals, the Commission cited as the reason the Corporation's financial
uncertainty in advance of the then-pending federal budget, and said that "it
would be inappropriate to set a hearing date for the renewal of the CBC's
licences until the CBC has had an opportunity to establish its future operating
Under the government's Deficit Reduction
Action Plan announced in the budget tabled in Parliament on in March, the
reductions to the CBC's Parliamentary appropriation, when fully phased in over
the next three years, will amount to $115 million annually. According to information filed by the
Corporation with the Commission, this represents a 10% reduction in the
Corporation's total appropriations and a 6% reduction in total revenues. This is undoubtedly a serious blow to
an already chronically underfunded organization.
As we look ahead to the November hearings,
the CBC is facing yet another financial threat of potentially equal or even
greater magnitude, when one of its greatest strengths could become a
Night in Canada, perhaps the most iconic program on
CBC English Television, first aired in 1952. HNIC is much more
than a program; it is a shared experience that brings together the entire
spectrum of CBC's vast audience.
Its importance to the CBC can hardly be overstated, in terms of either
its connection to millions of average Canadians or its advertising revenue
The current broadcast rights contract
between the CBC's English Television network and the National Hockey League
will expire in 2014 - within approximately the first year of the CBC's new
licence term. Recently, senior
representatives of at least two other major Canadian broadcasting organizations
with deep pockets and ample shelf space have been quite clear and open about
their intention to bid aggressively to win this contract away from the CBC.
We understand that hockey represents a
significant percentage of total commercial revenues for CBC English Television;
the actual numbers, of course, are confidential to the CBC. Nevertheless, the scenario described
above inevitably casts a further shadow of significant financial uncertainty
over the CBC's immediate future - quite possibly of a similar order of magnitude
to the recent federal budget reductions.
While there is currently insufficient
information in the public domain to accurately quantify that threat, it seems
clear that the potential impact of the loss of NHL rights on the CBC's
audiences, revenues, overall business model and ability to discharge its
mandate could constitute nothing less than a "game changer".
In these circumstances, Friends recommends
that the Commission carefully examine the importance of hockey rights to the
overall CBC English Television commercial revenue model, and put on the public
record all possible facts and figures which facilitate transparent
understanding of this situation without, of course, unduly compromising the
CBC's competitive position.
This should include all relevant data,
including the direct and indirect audience and revenue "lift" hockey gives to
the rest of the schedule, during both the regular and playoff seasons. Various alternative scenarios for
replacement programming, and its projected audiences, revenues, and rights and
production costs as compared to hockey, should also be part of the picture.
Moreover, we recommend that the Corporation
be asked to describe its contingency plans to discharge its mandate and live up
to its commitments, in the absence of NHL hockey. Failing this, we are at a loss to imagine how the Commission
can renew the CBC's licences for a seven year term, without any idea of what
might happen to those commitments within a mere twelve or eighteen months.
Doing so would be akin to issuing a blank cheque.
In addition, given the centrality of
hockey-related revenue to CBC English Television's overall commercial
activities, it would be important for the Commission and the public to know the
net value (minus the cost of sales and related promotion, distribution and
administration expenses) of the network's remaining advertising activity, in
order to be able to reassess the relative business and public policy cases for
and against the continued presence of advertising on CBC Television, in the
absence of hockey.
Friends respectfully urges the Commission
to request the Corporation to file the additional information described above
on an expedited basis.
Aug 2, 2012 — Letter: Broadcasting Notice of Consultation 2011-379-2
Response from the CRTC to FRIENDS' recommendation that the commission examine the importance of hockey rights to the overall CBC English Television commercial revenue model.
Jul 16, 2012 - Letter: Applications by CBC/Radio-Canada to renew broadcasting licences for radio, television, specialty television, and Friends of Canadian Broadcasting Letter of July 12, 2012
CBC responds to FRIENDS' recommendation that the CRTC carefully examine the importance of hockey rights to the overall CBC English Television commercial revenue model.
Apr 12, 2012 — Policy Brief: Re: Advertising on CBC Radio 2 & Espace Musique
FRIENDS encourages the CRTC to reject a CBC proposal to place ads on Radio 2 & Espace Musique and instead proceed with the long-delayed review of the overall licensing of the Corporation's networks and services.