Global, CTV: unite and conquer

Amid the cross-media ownership hullabaloo of the CTV and Global licence renewal hearings, CanWest has announced the conclusion of two highly anticipated deals: the selling off of its interest in Montreal’s CFCF and the sale of ROBtv to rivalcaster CTV for a combined sum of $120 million.

In addition to using the proceeds to pay down corporate debt, selling off the sought-after assets to CTV paves the way for the fall launch of Financial Post Television, a new digital specialty, says Leonard Asper, CanWest president and CEO.

On the first day of the hearings, April 17, trustee L.R. Sherman and CTV announced they have entered into an agreement for CTV to buy a 70% equity interest in CFCF for roughly $90 million. The total value of the station is said to be $141.5 million.

The sale is subject to the actions of Caisse de depot et placement du Quebec, owner of CFCF’s remaining 30%. The Caisse has the right to buy the station at the same price as the CTV deal, sell its interest to CTV or retain its position in the station.

The deal is also subject to the approval of the CRTC, which mandated the divestiture last July when it approved CanWest’s acquisition of eight television stations from WIC Western International Communications.

The Competition Bureau forced CanWest to sell its 50% interest in ROBtv, which was originally 50% owned by The Globe and Mail, after CanWest acquired the bulk of the Hollinger empire last November, including 50% of Globe and Mail rival paper the National Post. To further complicate the issue and make an even better case for the selling of ROBtv, BCE later bought both CTV and The Globe and Mail, rolling them both under the same corporate umbrella, Bell Globemedia.

After months of fighting to hold on to the specialty asset, CanWest finally succumbed to selling it to the most likely bidder for $30 million in cash.

At the same time, the Winnipeg-based broadcaster secured carriage on BCE-owned satellite system Bell ExpressVu for its parallel business specialty Financial Post Television, a new digital specialty that will combine business news and analysis resources of Global Television and the National Post newspaper.

This leads to the most hotly debated issue at the recent licence renewal hearings for Global and CTV: cross-media ownership.

‘Over the past 12 months, BCE/CTV, as well as Global, have made major acquisitions in other media – most notably newspapers. This is the first opportunity for the commission to discuss with both parties the impact of these acquisitions and the issues that are raised with respect to convergence and cross-media ownership,’ said CRTC chairman David Colville, in his opening address.

Likewise, as the hearings progressed, the CRTC spent much time challenging the broadcasters on how they propose to maintain a diversity of voices as outlined in the Broadcasting Act (even though the Act is currently under review) and keep newsroom resources separate (in spite of the fact the CRTC does not have jurisdiction over newspapers).

Andree Wylie, vice-chairperson of broadcasting for the CRTC, went so far as to suggest a code to prevent print and broadcast journalists employed under the same corporate banner from communicating with each other in order to avoid homogenous news coverage, as agreed upon in the recent Quebecor hearings.

Both Global and CTV balked at the idea, preferring the method of self-governance when it comes to news coverage and information sharing.

Leonard Asper called the suggested code ‘unconstitutional,’ and both broadcasters proposed that a complaint system would be more suitable.

Under such a system, readers and viewers would be invited through public service announcements to complain to various press councils and the Canadian Broadcast Standards Council about any evidence of lack of diversity. Global, for example, committed $1 million for a newspaper public awareness campaign to inform audiences of their avenues for complaints.

The broadcasters would also submit public complaints to the CRTC on an annual basis.

The final statements of principles and practices drawn out by both broadcasters, collaboratively, were virtually identical.

Both commit to adhering to the Broadcasting Act in its entirety, which requires that ‘the programming provided by the Canadian broadcasting system should provide a reasonable opportunity for the public to be exposed to the expression of differing views on matters of public concern.’

Each broadcaster will maintain its own news management structure for television operations, which is distinct and separate from its affiliated newspaper holdings, with journalistic content and presentation decisions for the broadcasters to be made by the television news management team.

Neither CTV nor Global news managers will sit on the respective newspaper boards. But while CTV has said it would prohibit anyone from CTV from sitting on The Globe and Mail’s editorial board, CanWest has not made a commitment to prohibit senior executives from sitting on the board of the National Post.

Both broadcasters will maintain membership with the CFSC and will continue to adhere to each of the codes under its purview, including the Canadian Association of Broadcasters Code of Ethics and the Radio and Television News Directors Association Code of Ethics.

Other issues addressed at the hearings, wrapped April 25, were priority programming, regional and local reflection, group synergies, service to the hearing and visually impaired, and vertical integration.

Among the interventions, ACTRA’s main thrust was to challenge the CRTC’s decision not to regulate the Net given the recent acceleration of vertical integration and cross-media ownership. With the Internet moving beyond its role as a promotional tool and becoming a viable audience tracker and revenue generator, the union is pushing for the CRTC to take a hand at regulating the Internet, a new and viable avenue for performer royalties.

While CTV talked of its commitment to fostering the best of Canadian programming through cross-platform promotion as well as TV follow-up with the Internet, the commission asked the broadcaster why so much of its Canadian primetime programming is scheduled on the ever-unpopular Saturday night slot.

The commission also challenged the broadcaster on why bigger is better, to which Trina McQueen, CTV president and COO, responded: more time, more resources and more platforms for creativity. Specialty channels, for example, can use CTV’s resources to develop new material and take bigger risks.

Global, which promised $260 million to Canadian drama and comedy over a seven-year licence term, proposed that it could generate an additional $5 million a year if the CRTC would allow it to increase advertising during primetime to 14 from 12 minutes per hour. Because of increasing competition for ad dollars with the rapid-paced emergence of specialty channels, Global argues for more flexibility in advertising regulation.

The CTV and Global’s licences expire Aug. 31 and the CRTC is expcted to come down with a decision by early July. *

-www.ctv.ca

-www.global.ca

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