Three months to wait for a list of specialty application winners and losers, and while the speculation mill is turning over which of the 40 will be the chosen few, some are apparently feeling confident. Distributors are already receiving handshakes for programming from specialty channels not yet licensed, a maneuver snarling the existing specialties’ program purchasing plans and escalating the shelf-product bidding war already in play.

Three weeks of specialty hearings closed May 24, a laborious process that left applicants walking away sure of few things. Among them, that analog space exists for just under 10 channels and that the marketing of the new services needs to start a.s.a.p.

What the commission will decide is always guesswork, but the vast majority equally are convinced it will choose to go with licensing scenario three, a two-tiered pack of licensees broken into an analog and a digital group that could yield a total of 12 to 15 new services all desperately seeking programming.

Canadian distributors say they aren’t receiving official bids for programs from the as-yet-unlicensed specialty broadcasters. But Marilyn Preston, director of television sales for Malofilm Distribution, says the already established broadcasters who have applications are certainly looking to put dibs on programming for their new channels should they be licensed. ‘In some cases, where there might be an overlap of programming needs, they’re even thinking of sharing – something I think needs to be discussed.’

Overlapping skeds

The History and Entertainment Network, backed by Alliance Communications and ctv, isn’t moving to nail down product, but overlapping program skeds were a topic of discussion for some applicants, and given the dirth of product in the Canadian market in genres like comedy and science fiction, it’s likely some are hedging their bets, says Phyllis Yaffe, ceo of Showcase Television.

‘If there are licensees that are extremely optimistic and need an enormous amount of programming in a category for which there is very little available, there may be the motivation to go this route and lock in that product. But it’s risky to hold the sale for a year and a half. Producers too are waiting to see some money out of the program’

As the would-be specialties put strategies into play, those already up and running are angling to solidify relationships with their product suppliers before the onslaught of the ’97 pack.

‘As we grow and compete for programming the prices are going to go up. We’d like to become as stable as possible before more competition comes whether that means building better relationships with distributors or longer contracts for your programming,’ says Yaffe.

Others are taking a different tactic. One specialty exec bidding on what was thought a relatively easily acquirable strip, got word at the end of May that his price would have to go up to match that of a would-be specialty which had put in a conditional offer.

‘These distributors are laughing. Some of this programming never had a window into Canada before; now they may have three or four. I said let them wait until August. Let them sweat.’

Dale Taylor, vp programming and production at ytv and officer for TreeHouse tv, says the awareness of shrinking available inventory is generating a lot of concern. He’s had some ‘interesting conversations’ of late with distributors making reference to the new demand for certain products.

‘It’s the nature of the beast to try and position one telecaster against another and say we’ve got this many bids on the product. We’re all like blind hens looking for corn when it comes to programming, particularly with Cancon, and it’s going to get more problematic when we’ve got six or more services. Prices will go up, but I think we have to stay buttoned down and be ready to invest strongly and wisely in product that’s for us.’

But 18 months away from the ’97 services, prices are already up, particularly for strip programming, says Janice Platt, vp programming for Life Network. ‘We just lost a series that was clearly our mandate to a service for which it fell in the periphery of their mandate. But they outbid us. It’s a valuable branding entity and there’s definitely competition.’

As a volume of services goes out to fill skeds from a finite pool, a whole new windows structure may evolve, says Dan Johnson, president and ceo of the Canadian Association of Film Distributors and Exporters. ‘It’s cause for celebration because you may see product that isn’t taken up already. But if exclusivity is required and the price gets to the point where people are no longer comfortable, then it might be necessary to re-evaluate exclusivity. Increasing the number of runs or shortening the duration of the window are two means of solving the problem.’

Distributors

Others on the distribution side are heralding the launch of new services. Stephen Ellis, president of Ellis Enterprises, which is a shareholder in Baton’s application for Outdoor Life, says between June ’94 and the launch of tier two in ’95, Ellis placed 750 new hours with the six English-language services.

‘No doubt it would have sat on the shelf if they hadn’t been licensed. It was a big bang for us,’ says Ellis. ‘We see this next round as a very good thing – but in terms of getting more hours on tv rather than seeing the prices go through the roof.’

But Preston cautions that even if the demand scenario drives prices up, the concentration of some of the applicants may de facto wash out the increase. ‘Overall the fees may be higher. But because it’s shared between two services, it effectively may be lower than two separate sales made by separate broadcasters.’