The Changing Face of the Boob Tube

War has been brewing between Canadian broadcasters and the cable and satellite carriers for years. At issue, who should pay for locally produced programs?

Yesterday, the Canadian Radio-television and Telecommunications Commission (CRTC) ruled in favor of the broadcasters, allowing them to negotiate charging a fee to carriers for inclusion of their signals in their channel line-up.

The ruling still requires federal court approval, and could be overturned by the court or appealed by the cable and satellite companies.

Broadcasters – including the primary television networks in Canada of CTV, Global and CBC – claim that unless they can collect a fee from television carriers, they won’t be able to produce local news and other locally produced programs.

CRTC reports confirm a loss in revenues, saying private Canadian TV broadcasters lost $116.4 million CDN in 2009, despite earning $8 million CDN in 2008 – that’s a huge drop of 93 percent.

Cable companies on the other hand had profits of $2.3 billion CDN in 2009, an increase of 11.9 percent from the $2.1 billion CDN they raked in, in 2008.

Though cable and satellite companies claim any new fees from the broadcasters will just be passed on to you and me – their customers.

Who’s right? Who’s wrong? Are Canadian broadcasters just poor money managers?

The answer – as with most things in life – isn’t that cut and dry.
The real problem isn’t the broadcasters or the television carriers fault. The real blame is our own ingenuity in technological advances.

When television first started breaking into our living rooms, channel selection was pretty limited. There were only a handful of signals available over the airwaves, sent via the Very High Frequency (VHF) band. Only channels two to thirteen could be carried on this frequency, which seemed like a lot, as not even half that many actually existed. Eventually, as television and radio stations began popping up all over the United States, the American Federal Communications Commission (FCC) re-allocated all over-the-air “bandwidth” to carry the load.

Amplitude Modulation (AM) and Frequency Modulation (FM) went to radio, while television stayed with VHF, and got an additional frequency – Ultra High Frequency (UHF), which carried television stations 14 to 83.

For those old enough to remember changing channels on their televisions long before remote controls existed – YES there was a time – there were two knobs on the boob tube. The primary VHF band, allowed you to tune in channels two to thirteen, and then you often would tune that dial to “U” (or some other similar symbol) and continue channel surfing on the other dial to get the few scattered stations on the UHF band.

As television caught on, more channels crept into the airwaves, and soon signals were being carried by cables buried deep underground. To get cable initially, you needed to purchase or rent a cable box, which allowed you to get as many as 60 to 99 channels depending on the cable box – again that seemed like way more than you’d ever need.

When digital television came out, the numbers of channels became a moot point.
Technology even solved the mysterious channel one phenomenon – channel one was never available on analogue-based systems as that frequency is actually reserved for emergency responders in many parts. But thanks to microchips, computer processors, and the completely electronic format of digital signals, digital television channels can be assigned any number, and the number of ‘em is just as endless.

This gave rose to the specialty channel boom – from the 24-hour all news networks, weather channels and other information-based programming, to the movie networks, documentary channels, there is even a channel called “Fireplace Channel” which – you guessed it, shows a roaring fire in a quaint fireplace 24-hours-a-day seven-days-a-week. Though you may start to question your sanity if you watch the Fireplace Channel for long.

And this is what is killing your local programming – not the ineptitude of broadcasters, or the greed of cable and satellite providers.

The more correct term for this phenomenon is “narrowcasting” instead of broadcasting – as specialty stations cater to very narrowly defined demographic groups. Sports channels run nothing but sports-related programming, catering to sports fans, while science, technology and nature channels cater to people interested in those specific topics, while the Fireplace Channel caters to – well – uh – er – we aren’t sure who THAT channel is for!

The point is, as television stations become more specialized, the television viewing market splits into fragments of individual viewers, each person watching the specific television stations which cater to each individual’s own interest.
I love science, technology and nature shows, found on stations such as National Geographic and Discovery. I also enjoy movies, so I get all the move networks.
You may like movies, but prefer classic cartoons, so you get Teletoon Retro.
Everyone’s individual tastes are different.

This is bad news for broadcasters, which cater to a general audience, trying to have a little bit of everything for everyone.

Why would I waste time even browsing channels which don’t typically cater to my specific interests, when I can tune right into channels that do?

So broadcasters in the traditional sense – the CTVs, Globals and CBC networks – are losing viewers, and that loss in viewers trickles down into less ad revenues, as the fewer people watching, the less likely companies will pay big bucks to promote their products and services on that channel.

Also, specialty channels offer a unique opportunity for commerce – they deliver the specific viewers interested in the specific types of goods and services for that station.

Think about it, wouldn’t, say a power tools manufacturer have a better chance of selling their products on a channel which specializes in home renovations, than on a broadcaster which may not even have a home renovations show?

As the television market continues to fragment, thanks to these specialty channels popping up all the time, traditional broadcasters will continue to lose money.

Just as the traditional broadcasters lose money, the television carriers earn more – because we are willing to pay more to subscribe to the specific channels we want to watch. That’s why the cable and satellite providers are raking in the big bucks, while the broadcasters are losing their fiscal shirts.

Allowing the broadcasters to charge additional fees to offset this loss in revenue isn’t going to make matters any better in the long-term. In the short-term, sure, any money you toss at a problem in the short-term appears to solve it.

But in the long-term, there simply won’t be enough viewers watching the traditional broadcast outlets. Unless the broadcasters begin narrowcasting, they will continue to bleed viewers until there is nothing left to but bone dust in the sand.

That’s the changing face of the boob tube.

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Mashed Potato Wrestling, Scantily Glad Women, and Local Television – What Matters?

Maybe it is just part of being Canadian, to automatically denounce anything coming directly from our home and native land – that is until that thing makes it big down south.

Canadian actors, singers, song writers and other famous people from North of the American border never seem to make it big in Canada, until they garner recognition outside of Canada. Then, all of a sudden, our eyes open big and wide, and we proudly proclaim “he’s Canadian, eh?”

From Jim Carrey, Mike Myers, Shania Twain and The Bare Naked Ladies, to Elisha Cuthbert and her 24 co-star Kiefer Sutherland (who’s dad is also a famed Canuck – Donald) – all these famous Canadians make us home-grown-proud. But that hometown-pride never surfaced until they became known in the big U.S of Eh, eh?
Local Canadian television is falling victim to our fascination with American programming traveling over airwaves, digital cable and satellite signals.

Just this past Wednesday, Rogers Broadcasting killed 60 local Canadian television jobs, when they laid off these people from their recently purchased CityTV stations in Edmonton, Calgary, Vancouver and their flagship station which started it all, CityTV Toronto.

Rogers Broadcasting which owns CityTV, claims the ‘restructuring’ was necessary in the highly competitive industry.

Although the hardest hit are those whose jobs are no more, when a broadcaster cuts people, everyone sees it. The local lunch, evening and late night newscasts are gone from all stations except for the flagship station in Toronto, which still has both a dinner-hour newscast and their late night news. All stations were lucky to keep their morning programs.

Be Thy Own Enemy Be True

Local programming is under attack in Canada – but we are our own enemies.

Thanks to digital television signals, we are no longer limited to a mere twelve channels – for those of us old enough to remember those dark and grainy television days. Remember when your TV only had channels two to twelve, and you had to turn the knob to “UHF” (for Ultra High Frequency) to get any remnants of ghosting channels, often fuzzy at best, from beyond the basic twelve?

These days, we hook up a digital receiver, which is magically connected to either a digital cable outlet, or a digital television “co-ax” cable which is attached to a microwave satellite dish, bouncing digital signals to the stars.

There is literally no limit to the number of channels these digital signals can receive, so in theory, the sky really is the limit.

And that has created a whole new way of broadcasting – narrowcasting – and this is what is killing local television on both sides of North America, and probably elsewhere these digital signals soar.

Narrowcasting is the ability to create targeted television stations – not just programs, but complete television stations – geared towards specific demographics.

Back in the late 1980’s, we were introduced to the first of this kind of station – MTV. MTV was the first station to cater specifically to teenagers and their musical tastes, creating a whole new form of broadcasting, the music video.

Speed jump to present day, and we have several music video channels, each one playing videos for specific musical tastes. From metal to smooth jazz, to country – but these narrow focused stations aren’t limited to just music.

Shop-a-holics can rejoice on the shopping channels, techies can swoon in on the latest techy toys on their own channels, there are movie channels for movie lovers, History Television for history buffs, even Book Television for those who wish they were reading something instead of sitting in front of the tube. . .

For every culture, religion, special interest group, demographic – some of the many channels I’ve seen pop-up on my digital box: NASA TV (for us astronomy/science buffs), Discovery Health (for medical/fitness buffs), Canadian Odds Channel (for those who want to bet on the horses, but don’t want to deal with a slimy bookie at the track), The Game Show Channel (for those who like to yell out answers at their TVs), Teletoon Retro (showing us old folks classic cartoons) . . . the list goes on and on and . . .

Before all of this, we all watched the same local twelve channels. Not everything appealed to everyone, and the biggest gripe was “there never is anything interesting on TV,” but at least we all watched. Thanks to narrowcasting, we all watch different channels, often leaving the general interest local stations fending all alone for viewers.

Local stations were a bit of this, a bit of that, a bit of everything, because they could never narrowfocus on any one thing. Their audience was the mass appeal of television – back in the days when there were so few television stations, we were subjected to whatever the television executives thought we wanted to see.

Now the tables have turned, and by our tuning in – or more likely out – we dictate what the television executives run, else they are forced to do what Rogers Broadcasting’s executives did, and slash programs and jobs which just aren’t capturing the viewers.

But the real problem is us.

We don’t care enough about what goes on in our own backyards – how could we when we are drawn to scantily glad women wrestling in a vat of mashed potatoes on the Mens channel, or that hypnotizing infomercial for the Sham WOW?

Hmm. . . learn about a six car pile-up on the local news, or watch mashed potato wrestling chics? What a world we live in.

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It’s War in Canada’s Television Industry – Thanks to the Government

War has been declared between Canada’s local private broadcasters and the cable and satellite providers over who should pay for Canadian content.

Many Canadians are more than familiar with “funded in part by a grant from the Canadian Film and Tax Fund” tagged at the end of most Canadian-made productions. This fund was setup by the federal Canadian government many years ago, to ensure Canadian broadcasters had an incentive to produce their own Canadian-grown content, rather than relying solely on American-made productions.

Recently, the federal government decided to change where that money comes from, and as is typical of governments looking for more money, they imple

Image by William Hook via Flickr

mented a new tax to cover Canadian-made content.

The federal government passed this tax onto the cable and satellite providers, as a fee equal to about $10 per subscriber. Naturally, the cable and satellite providers have passed this new tax onto their subscribers. And this is where the battle cries began.

In tough economic times as we’ve been in, we’re all trying to save money. And for most of us, if that means cutting back on our entertainment expenses, say cancelling some of the channels we don’t watch to save a handful of dollars, for the most part we’ll do just that.

Research has shown that for every price increase in cable and satellite services, over 40 percent of those subscribers will adjust their subscriptions to counter the increased fee. According to the same study, about five percent of cable television subscribers hit

Image by Mark Blevis via Flickr

with an increase of $10 or more on their monthly bill will actually cancel their cable services completely.

So, just ahead of the addition of this new tax on their customer’s bills, the cable and satellite companies informed their customers of the new fee, and in a not quite objective letter, blamed the local broadcasters for the cash grab. They even included contact information so their customers could complain directly to their local federal Members of Parliament (MPs) – how nice of them.

The local television stations retaliated claiming they would go off the air, if they didn’t have this funding to produce quality, Canadian programming. Their news crews did “investigative” pieces on how the money is used, and what will happen if the government seed money stops coming. They ran – and continue to run – ads saying they will go out of business if they don’t get the money to produce Canadian content.

The cable and satellite companies continued the battle, with their own ads, more letters and emails to their customers, and claims that Canada’s private broadcasters made a combined total of over $4 billion in profits – hardly penny-poor in need of a handout.

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Although these very same service providers aren’t exactly desperate for cash either, making mega-huge profits off their subscribers. One of the biggest cable companies in Canada – Rogers Cable -- has made so much over the years, they have bought professional sports teams and stadiums. Currently, Rogers owns Major League Baseball’s Toronto Blue Jays, and their home stadium, formerly “The SkyDome,” renaming it “The Rogers Centre.”

SO what is the truth in amidst all this propaganda from the local Canadian private broadcasters, and the cable and satellite companies?

The truth is the federal government continues to demand Canadian content produced and aired by our local broadcasters, but has decided they just don’t want to fund it anymore. So they mandated – through the Canadian Radio and Television Commission (CRTC) that all television service providers pay this fee, else they would block the signals of the major American networks – ABC, CBS, NBC, and FOX.

This whole war started because some select members of our federal government were looking for a new revenue stream and they realized the government had been subsidizing Canadian content for years. Back in the mid to late 1990’s, they changed the rules governing local Canadian channels and television service providers.

They began retooling the Canadian Film and Television Tax Credit, and a

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t the same time ended the mandate that all television providers had to provide a community access channel. For years, the law of the land was quite clear – if you wanted to be a cable or satellite company, you had to provide a free, public access channel which was open to the local community for their news, information and access to locally produced content.

As more diverse as the television dial became, the government realized it was impossible for the television service providers to cater to the many needs of their subscribers with one channel, and they removed that mandate for a local community channel from the rule book – with some lobbying from the television providers themselves – naturally.

This unfortunately also opened up the possibility, to the federal government, that they no longer needed to pump as much money into funding local Canadian content. But they always put pressure on the television broadcasters to continue to create this home-made content.

And rather than face the wrath of the Canadian population as a whole, for cutting this subsidized funding for Canadian-made productions, they decided it would be an easier political pill to swallow for the television service providers. They never thought for a second, that the television service providers would in turn, pass this new tax onto their customers – though that just makes sense.

And now we have a war of words being aired very publicly on televisions across the country, as the big cable and satellite companies go head-to-head fighting for what each believes is in their best interests.

While us lone consumers who subscribe to these services are stuck in the middle of it all – all while watching are cable and satellite bills increase.

What should be done, is to go back to the original model, where television service providers, local private broadcasters, and the federal government each contribute a fair share of money to a fund for local, Canadian content – without charging anything directly back to us subscribers.

This was how it was for much of the 1970’s until the late 1990’s, when the federal government introduced laws to deregulate the cable and satellite industry. They had hoped that these changes would open the market, which in turn would lower the cost for subscribers via good old fashioned competition.

That plan fell through the ice like a barrel full of bricks, as many of the smaller, local cable companies were bought up and swallowed by the already mega-large cable and satellite providers.

And now it has come full circle, as the government’s plans to increase competition have failed, but they continue to act as if they were successful, by implementing this new tax. But because deregulation has failed, there isn’t a broader, more competitive customer-base to draw additional funds from.

Yet the government – never all that quick on the uptake – is still bargin

Image via Wikipedia

g ahead with their plans to increase funding for Canadian content, by adding this new tax.
And we haven’t even scratched the surface when we toss the end of analogue signals into the mix. This year, American stations stopped broadcasting on what was called “over-the-air” via the good old fashioned Ultra High Frequency (UHF) band. Remember when you were able to just plug in a TV anywhere there was an electrical outlet, and watch fuzzy stations using “rabbit ears?”

Not anymore in the States – and soon not anymore in Canada either. As digital signals, with their high definition digitally crisp and clear pictures dominate the landscapes, both Canadian and American federal governments have decided to acquire those UHF frequencies used by television broadcasters for emergency signals and lower-band cell phones. So if you don’t already subscribe to cable, eventually you will have too – otherwise all you will see on your TV is your own reflection.

Maybe we all should write our local MPs and tell them to wake up, look around, and work with what is, rather than what they thought would have been?

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