Revenue for Canada’s 228 specialty, pay-per-view and video-on-demand channels grew 0.5% – or $19 million – to $4.3 billion in 2015, according to the latest financial results from the CRTC.
It was the lowest year-over-year growth rate for Canada’s specialty sector since 2009, with a $19 million decline in advertising revenue partly offset by a $30.6 million increase in subscription revenues.
Expenditures rose from $3.1 billion to $3.3 billion, causing profits before interest and taxes (PBIT) to drop from $1 billion to approximately $884.9 million – although the PBIT margin for the sector remained healthy at 20.8%.
The 10 highest-grossing services accounted for more than one-third (37.7%) of total revenues generated in 2015, with the acquisition of exclusive NHL programming rights paving the way for both Sportsnet One and TVA Sports to crack the top 10.
Five sports services ranked among the top 10 highest-grossing specialty services, with Bell Media-owned TSN leading all channels with $442.2 million in revenue, followed by Rogers Media-owned Sportsnet ($360.4 million) and the French-language service Le Réseau des Sports ($162.5 million).
Sportsnet One was the seventh highest-grossing specialty service with revenue of $86.9 million, followed by TVA Sports ($81.8 million). TVA Sports saw overall revenue increase nearly 400% to $65.2 million, which the CRTC attributed primarily to its acquisition of NHL broadcast rights.
However, the cost of acquiring the programming caused TVA Sports’ total expenses to balloon by $85.4 million, resulting in a PBIT margin of -47.6% for the broadcast year ended Aug. 31.
The Movie Network ($120.6 million), Discovery Channel ($97.4 million), CBC News Network ($87.9 million), Movie Central ($81.7) and W Network ($79.9 million) rounded out the top 10 highest-grossing services.
Broadcasters invested a total of $1.5 billion in Canadian-made programming last year, with $409.9 million going to independent producers – representing a 9.1% ($34.1 million) increase from 2014.
Nearly half (46%) of all spending on Canadian programming went towards sports, with broadcasters investing $689.4 million, a 26.7% increase from the previous year that was partly attributable to the acquisition of NHL rights by Rogers and Groupe TVA.
Information accounted for 32% of program expenditures, while music and entertainment accounted for 18% of investment. Non-Canadian programming expenditures increased $45 million (11.6%), with spending on non-Canadian sports programming rising $17.4 million (17.4%).
