A long-running feud in the Canadian broadcasting sector is about to spill on to Main Street.
In the coming weeks, the country's major television networks and its biggest cable companies will both be mounting public appeals for support in their bitter debate over proposed new fees on customer bills.
On one side are the TV networks which, in a rare show of unity among rivals, will announce today they are banding together to argue that cable companies aren't compensating them fairly for their signals, and are making significant profits on the backs of the broadcasters.
The accord between CBC, CTV and Global Television, will run headlong into a campaign launched recently by the big cable companies that have sent letters to customers in bills arguing the networks have no right to seek such fees. Rogers Communications Inc. and Shaw Communications Inc., Canada's two largest cable firms, have urged customers to contact Ottawa and oppose the proposed new fees.
The networks have suggested they be allowed to charge 50 cents a month per customer, similar to the fees cable channels are allowed to collect. In Rogers case, it has said bills could rise between $5 and $10 for customers in Toronto, a figure the networks say is inflated and being used to scare consumers.
Both public appeals amount to lobbying campaigns aimed at building public support that could sway the issue in Ottawa ahead of federal hearings in mid-November.
After seeing the letters sent out by the cable companies, the TV networks decided to launch their own campaign, called Local Matters, since they say the fees are needed to fund local programming. "The one that went out a week ago that your bill is going to rise between $5 and $10. That's just not true, they're not telling customers the truth," said Paul Sparkes, executive vice-president of corporate affairs, CTVglobemedia. The company owns CTV and is also the parent company of The Globe and Mail.
However, Canada's biggest cable company says the networks are seeking easy money in the new fees. Phil Lind, vice-chairman at Rogers Communications, said the broadcasters are using a depressed advertising market to argue for financial aid. The Rogers-owned CITY-TV network has started to see ad sales pick up, he suggested.
"CTV, if it's anything like CITY-TV, it's better now than it was six months ago, so the advertising is coming back. There is more advertising and better, stronger advertising than there was six months ago, a lot stronger."
The CRTC said this spring it would allow the two sides to negotiate a settlement.
It is not often that public broadcaster CBC finds itself siding with private broadcasters CTV and Global. Since CBC gets government funding and CTV and Global are more heavily reliant on commercial revenue, they often see issues differently within the industry. The new campaign from the broadcasters comes on the heels of a similar public appeal CTV launched last year to build support for local TV stations.
"We've all supported CTV's initiatives [over the past year] And now this initiative just recognizes that we all have an interest and so we're joining forces for that reason," CBC chief regulatory officer Steven Guiton said.
Estimates peg the value of the fee proposal at between $60-million and $90-million per network, if they are approved, depending on what the networks would be allowed to charge. The cable companies say they will pass the charges on to customers, rather than absorb the costs themselves, if the CRTC approves the idea.