An independent company’s plan to purchase Brandon, Man. television station CKX-TV has collapsed, leaving owner CTV Inc. to pull the plug on the channel.
Bluepoint Investment Corp., a holding company owned by Bruce Claassen, chairman of Aegis Media Canada and CEO of Genesis-Vizeum Inc., agreed in July to buy the station from CTV Inc. for $1. Calgary’s Shaw Communications had previously agreed to pay the bargain-basement price for the channel, but backed out of the deal in June.
According to Claassen, Bluepoint’s deal fell through after encountering some unexpected complications following the submission of its application for approval from the Canadian Radio-television and Telecommunications Commission several weeks ago. In particular, said Claassen, was the CRTC’s decision to place rules about direct-to-home satellite access in abeyance for a period of more than two years.
“From the time that we made the deal with CTV to the time we put our application in, the CRTC had made some changes,” said Claassen. “[At the time of the CTV deal] the CRTC ruling was that at least one independent station in every province guaranteed DTH access, and since [CKX-TV] is the only independent station in Manitoba, we were pretty much assured that we would have that.
“But the CRTC put these rules in abeyance. They would not accept our application based on our request for DTH coverage.”
Specifically, said Claassen, the CRTC decided that it would reopen the DTH issue in November 2011. Even had Bluepoint been willing to wait, he said, there was no assurance from the CRTC of a favourable result two years from now.
Direct-to-home access is essential to the success of a station that serves several small, remote communities, said Claassen.
“Part of the reason DTH is so big in those markets is that cable companies aren’t going to bother to send lines 50 miles down for populations of 600, so they all put satellites up,” said Claassen. “In a place like Western Manitoba, 54% of the population picks up their signal through DTH, so half the audience we could attract would not be available unless the CRTC said [television carriers] were obliged to provide such coverage.”
Claassen said that he and his Bluepoint colleagues had made every effort to keep the deal alive, but determined that the purchase of CKX-TV was not viable at this time.
“We called every Member of Parliament that we know, every Member of Provincial Parliament, the mayor of the town, the CRTC, the deputy minister of heritage, and explained the situation. We worked our butts off,” said Claassen. “We said, if you take out DTH, our sales guys can’t go to Rona and Home Depot and sell because half the people in the town don’t see our station.”
Claassen added the CRTC’s requirement that 100% of content be available with closed captioning was also stumbling block. He said Bluepoint was unaware that the station was not yet fully compliant—164 of its 168 weekly hours of programming could be viewed with closed captioning previously—until alerted by the CRTC.
“The cost to do those four hours is incredible,” said Claassen.
When the agreement with CTV was announced in the summer, Claassen indicated that he was in the early stages of a plan to acquire several television properties in Canada and the U.S. He said today those plans would continue despite the result of the CKX-TV application.
“The broader plan is still in place. There are other stations, other places to go,” he said. “This was a disappointment, but we’re going to continue.”
CKX-TVwill go off the air following tonight’s 6 p.m. news broadcast.
