Fee for carriage a ‘matter of survival,’ says Asper

Canwest Global president Leonard Asper took another swipe at the federal broadcast regulator Tuesday, saying its rules are to blame for the problems plaguing the TV sector—not the economic crisis or the staggering debt his company faces.

The CRTC is holding its regular review of TV licenses as many local TV stations face closure or sale. The commission is looking for ways to temporarily help broadcasters while searching for long-term fixes.

Canwest is in the most perilous financial situation, trying to stave off bankruptcy by renegotiating hefty debts with creditors, but “debt is a separate and distinct issue,” Asper said.

“Currently, the system favours one sector over all others,” he said, referring to the cable industry.

Asper has long demanded that broadcasters be given permission to charge cable companies for the right to transmit their signals, known as fee for carriage.

After turning down the request twice before, the CRTC is under intense pressure by the industry and antsy MPs to take another look.

Fee for carriage estimates tabled at the hearings put the fees at $352 million a year for the stations—$72 million annually for beleaguered Canwest.

“We’ve continued to advocate the need for [cable and satellite companies] to compensate us for the carriage of our local signals as a matter of fairness, but it has now become a matter of survival,” said Asper.

But cable companies, such as Rogers Communications, have warned that forcing them to pay fees will simply translate into higher bills for subscribers—anywhere from $2 to $10 more a month.

Rogers vice-chairman Phil Lind told the CRTC that his company’s Citytv stations expect to make money after the economic downturn is over. He said other broadcasters have mounted a “scare campaign.” “CTV made $200 million, Global made $168 million last year.” Lind said. “Everyone says, ‘Oh God, give me a crying towel.’ These guys are profitable because of their speciality services.”

CRTC chairman Konrad von Finckenstein has said publicly that he does not believe the fee for carriage issue would be a panacea for the industry.

Asper outlined several other regulatory areas where he sees broadcasters at a critical disadvantage. He said federal regulators made a mistake decades ago when they allowed cable companies to transmit the signals of American TV stations in Canada.

Now, he explained, Canadian broadcasters are buying U.S. programs but are still competing for viewers with American stations carried by the cable companies.

“The structure of the market has been fundamentally altered as a result of years of over-licensing and authorizing too many foreign signals into Canada,” Asper said. “Our only source of revenue is advertising and the market is now saturated.”