Broadcasters submit amended group licence renewal recommendations

On the English-language side, Bell Media and Corus both said they would be prepared to increase the baseline for PNI spending to 6%, but with a caveat.
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The large English and French-language broadcast groups have laid out their amended proposals, after Canadian Heritage in August sent the CRTC’s group licence renewal (GLR) decisions back to the commission for reconsideration.

In May, the CRTC issued the decisions for its licence renewals, setting English-language spending requirements on Programs of National Interest (PNI) at a minimum of 5%, with 75% of that being directed toward independently produced programs. (PNI includes drama, comedy, documentary, children and youth, music and variety, and certain awards programs.)

At the time, the decision sparked criticism from a number of Canadian organizations (including the CMPA, WGC and DGC), which argued it didn’t meet the objectives of the Broadcasting Act. A CMPA-commissioned Nordicity report also said a 5% PNI spend could result in a $141 million decrease in broadcaster spending on Cancon over the five-year licence term.

In their amended proposals, published by the CRTC on Dec. 5, both Bell Media and Corus suggested increasing the PNI baseline for the large English-language groups to 6% of the previous year’s revenues, up from 5%. According to Bell Media, the 1% increase would result in PNI spending that is “tens of millions of dollars higher” than the current 5%. The media co also said the increase would represent around $27 million over the final two years of its licence term.

However, Bell Media and Corus also said that, should the PNI baseline be increased to 6%, the percentage of PNI expenditures that is directed to independent producers should also be reduced to 50% from 75%. Corus noted that the reduction would allow it “to sustain the level of flexibility needed to allow licensed broadcasters to be competitive and respond to unregulated streaming services.”

Both companies also requested that the 30% Canadian Programming Expenditure (CPE) be reduced to 28%, which Bell Media said would “take into account the flexibility that is being removed by increasing the PNI spending floor.” 

Rogers meanwhile requested the PNI spend remain at 5%, which is in line with its historical levels. It also proposed that CPE remain at its current level of 30%.

All three of the large English-language broadcast groups also requested the standard five-year renewal terms be reduced to three years to better reflect the rapidly changing environment in which they are operating (with more international competitors operating in Canada) and the upcoming review of the Broadcasting Act. Under the proposal, the licence terms for all three of the large English-language broadcast groups would end in August 2020.

On the French-language side, Bell Media requested that its PNI levels be reduced to 15%, from 18%, which it said would align it with other licensees in the market. In addition, Bell Media requested that 50% of CPE for the large French-language groups be directed to French-language productions.

Meanwhile, Corus is requesting that the designated group established for Historia and Séries+ be eliminated and these services be regulated individually. Also for Historia and Séries+, Corus is asking for a return to previous CPE obligations as established by the commission and applicable during the licence term that ended on August 31, 2017. Those levels are 30% of previous year’s revenues for Historia, and 17% for Séries+.

The CRTC also opened up the proceeding to the public on Dec. 5 and will be gathering comments until Jan. 23.

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