Friends of Canadian Broadcasting proposed a four-point plan to revitalize local television news in Canada during an appearance this morning before the House of Commons Standing Committee on Canadian Heritage which is studying the issue.
“Television is the most important source of local news in Canada1. And local TV news is also very popular with Canadians who want their federal MPs to keep it strong. There are concrete measures your committee can recommend to strengthen local TV in Canada” Friends’ spokesperson Ian Morrison told the Heritage Committee.
First, federal tax policy has not changed in more than 25 years in response to new technologies that are challenging local broadcasting in Canada. Friends proposes tax measures to support local TV:
Allow advertisers to deduct the expense of online ads on Canadian Internet platforms only by amending the Income Tax Act to exclude tax deductibility for foreign-owned or controlled Internet advertising platforms, a measure that is already in place for ads on cross-border broadcasters and newspapers.
Expand the Canadian Film or Video Production Tax Credit to include local news programming produced by local broadcasters
Second, the Committee should recommend that the government to use its powers under the Broadcasting Act to instruct the CRTC, whose recent Let’s Talk TV decisions are forecast to do significant damage to Canadian broadcasters, to:
*increase contributions from broadcast distribution companies to support local television
*amend its Digital Media Exemption Order to require foreign and domestic over-the-top (OTT) television providers to contribute to Canadian programming, and
*ensure that Internet service providers and mobile operators are required to give priority to Internet-distributed Canadian local media through such measures as exemption from bandwidth caps.
Third, Friends is calling for a portion of windfall revenues the federal government will earn with auction of 600 MHz spectrum to compensate local broadcasters for the expenses they will incur to purchase new transmission technology, as the U.S. government has done.
Fourth, the government should examine measures adopted in the United States to strengthen local TV, including local-market rights protection rules and strong restrictions on the importation of distant signals on U.S. DTH.
Research conducted for Friends by the broadcast consulting firm Nordicity and consultant Peter Miller to analyze the economic impact of the CRTC’s Let’s Talk TV policies found that by 2020:
15,130 media jobs will be lost
‘Canadian Programming Expenditures’ will drop by $400 million (18%), and
Canada’s GDP will drop by $1.4 billion
“All this damage is a direct result of Let’s Talk TV regulatory changes,” Morrison noted.
Compounding this ‘hit’, television stations in small and medium markets are particularly vulnerable to adverse economic trends, according to a second Nordicity/Miller study. Near Term Prospects for Local TV in Canada projects that up to half of local stations in small and medium markets – where there is often no local TV alternative – will fade to black by 2020 in the absence of CRTC action. This would lead to an estimated 910 layoffs of journalists and others who work to put local news on the air.
When large-market local stations are included, the study projects job losses rising to 3,490.
Morrison urged the Committee to summon the CRTC Chair to ask him why the Commission’s Let’s Talk TV policies allow:
A majority of programs aired by Canadian broadcasters to no longer be required to be Canadian?
A majority of channels distributed into Canadian households to no longer be required to be Canadian?
Foreign broadcasters that distribute programs into Canadian households to not play by the same rules as Canadian broadcasters?