John Bitove made a key concession Wednesday in his bid to create a new national television network, telling federal regulators that he will fund a small amount of local programming at each station after concerns were raised earlier this week.
Mr. Bitove, a satellite radio and fast-food franchise executive, is seeking permission to launch HDTV Networks Inc., a network of stations in eight cities that would broadcast in high-definition.
However, rival broadcasters and the Canadian Radio-television and Telecommunications Commission both raised concerns that the network would not be funding local programming, while other Canadian broadcasters are required to produce between nine hours and 42 hours a week, depending on the station.
“We have heard the commission loud and clear, and we really want this licence,” said Mr. Bitove, who is the founder of XM Canada satellite radio service and heads up Priszm Income Fund, which owns hundreds of KFC, Taco Bell and Pizza Hut outlets across the country.
Altering his proposal, Mr. Bitove said the network would carry two hours of local programming a week at each of its stations. While that could ease some of the regulator's concerns as it considers whether to allow a new network after a wave of industry consolidation, rival broadcasters said it is not enough.
If approved, HDTV Networks would be the first national network to come along in decades, competing with mainstays such as Global, CTV and the CBC.
Both CTV and Global argued that Mr. Bitove's application amounts to a “superstation” model where a signal is carried nationally but does not fund local programming in other markets.
The distinction is potentially significant since the federal regulator does not have a category to offer licenses for U.S. style superstations.
“We are particularly concerned with the HDTV proposal to establish what appears to be a superstation that would enjoy the same carriage and other benefits as a national network without incurring the high costs of operating a network,” Charlotte Bell, senior vice-president of regulatory affairs for Winnipeg-based CanWest Global Communications Corp. told the hearings.
HDTV Networks wants to launch in Vancouver, Calgary, Edmonton, Winnipeg, Toronto, Ottawa, Montreal and Halifax. Though it will carry a national newscast and spend to produce Canadian television shows, the original bid didn't contain any local news or programming in each market.
CRTC chairman Konrad von Finckenstein acknowledged this week that Mr. Bitove's proposal could require a new category of licence unless the application was changed to include local programming.
The other networks also argued the industry isn't big enough to allow a new competitor into the market without placing ad revenue in peril. In response, Mr. Bitove said if Canada's major broadcasters are so worried about the fragility of the industry he'll buy any of them "for a dollar" to protect the owners from future losses.
He also criticized the broadcasting industry as a tight-knit club that protects its own members, saving his harshest words for the Canadian Association of Broadcasters which has opposed the bid. "Everything seems to protect the club," Mr. Bitove told the CRTC.
A decision on the application is expected later this year.
