A week behind crtc hearings, there are few questioning the commission’s approval of Baton Broadcasting’s merger with Electrohome or its asset swap with chum.

What’s still to be determined is the length of the licences which may be short-term rather than multiyear and reflect the question facing the commission after a year of new broadcasting licences and program supply agreements: if the strength of the network is greater than the sum of its individual licence parts, what are the benchmarks for contribution to the Canadian production industry?

Behind smooth presentations led by Baton president Ivan Fecan and chum coo Fred Sherratt, the July 15 and 16 proceedings yielded lengthy discussion of Canadian drama production, ‘tangible,’ ‘intangible’ and ‘the netting approach’ to benefits, and a compelling outline of Baton’s new vision.

As a national broadcaster grounded locally, Baton is prepared to ‘break new ground,’ says Fecan.

‘We believe the key to our future lies in our Canadian programming: offering our viewers unique programs with resonance for them. We aspire to become a place where Canadian creators and producers will look forward to showcasing their work and where Canadians will expect to see the best of Canadian programming available.’

According to Baton, key to actualizing the concept is the ability to reduce infrastructure and amortize programming costs over a coast-to-coast distribution base, meaning the commission’s blessing on all the deals in play, including its $10 million purchase of chum’s 28.4% of the CTV Network and control of the coop, is vital.

Consensus has it the maneuver makes too much sense to be denied. But questions to Baton and chum from crtc legal ­ one to their feelings on a short-term two-year licence and another on the potential severing of the chum Maritime property swap from the purchase of its ctv shares ­ may suggest the commission’s hesitancy to make far-reaching decisions without a clear benefits standard.

Charles Belanger, new vice-chair broadcasting, told Fecan the commission has little comfort level with the package in the offing.

‘You have come to us with a vision with words that ring of intelligence and from a practical standpoint dealing with evidence based on the existing environment,’ said Belanger. ‘But there is a shortage of something here.’

The shortage may not be so specific to the proceedings at hand ­ Baton is promising a comprehensive package in 1998/99 when ctv’s licence comes up for renewal and the ownership questions are sorted out ­ but rather a byproduct of the confusion generated by the new broadcasting landscape status quo.

CanWest with a program supply agreement in Alberta, Toronto-grounded chum with program supply agreements in Vancouver, Alberta and the Maritimes, Baton merging with Electrohome and taking over ctv, and wic potentially entering Quebec equals four ‘networks’ with national distribution capacity. Among them is a dog’s breakfast of local, regional and national licence conditions dictating how much each gives back to the system.

Strategically, this hearing has seen the need to step beyond the individual licence hearings, says Elizabeth McDonald, president of the cftpa.

‘The more important issue is the overall responsibility of the station groups with national ownership. Now is the time to look at what the new landscape means for drama, for kids’ programming and for new and emerging producers.’

Canadian drama

The private broadcaster’s contribution to the underserved program categories scored much airtime in the context of the Hull, Que. proceedings.

With the exception of Global Television Network president Jim Sward, who said ‘there is no issue of primetime Canadian drama’ and drawing violent responses from bbs and chum, the majority argued, as per the Directors Guild of Canada, that there is ‘an overwhelming need to support new Canadian drama.’

Government funding and support from the broadcasting units is vital to enhance both the quality and quantity of Canadian drama, said Peter Grant, a partner with McCarthy Tetrault and policy advisor to the dgc.

‘But the key component must remain significant licence fees to independent producers from conventional broadcasters whether as part of networks or as part of ad hoc stations.’

According to dgc statistics, the English-language private broadcasters spent 4.1% of their $580 million in ad revenue on the underrepresented programming categories in 1996, a drop in spending compared to 1995’s 4.6% on $526 million even though ’96 revenues increased.

The CTV Network in particular spent $23 million on categories 7, 8 and 9 programming, 3.8% of its ad revenue in 1996. The investment, compared to 1995’s $28 million expenditure is $5 million less even though advertising revenue climbed to $602 million from $595 million in 1995.

The dgc is willing to support Baton’s commitment to bring a ‘new vision’ for ctv next year, says Grant. But Baton’s takeover of ctv is a significant change to the system which should be accompanied by clear benefits. ‘We fully expect that significant increase of the licence fees coming from ctv bearing in mind the recent decline.’

chum, with two stations covering 80% of Ontario and program supply arrangements covering significant territories, should be ‘stepping up to the plate’ to offer benefits, says Grant who adds that Citytv never spends more than $100,000 in licence fees for a two-hour Canadian film ‘and usually spends much less.’ The dgc is proposing a contribution of 5% of the revenue at its new Ontario stations, should the crtc bless the deal. It also asks that the crtc examine City’s contribution to Canadian drama at its next licence review.

For its part, chum says the licence fees it offers ­ alone amongst the private nets supporting Canadian feature films ­ are often double or triple the amount suggested by the dgc.

‘We’ve helped finance over 40 new Canadian independent features in four years, with at least six or eight of those owning licence fees of $250,000 or more. The Directors Guild’s intervention is not representative of the independent production community,’ says Jay Switzer, vp of programming for chum.

The cftpa publicly recognized chum’s ‘truly unique’ commitment to the development and exhibition of Canadian films, but McDonald says the bigger question of equitable contribution to the system is best left to the commission.

‘The association must rely on the crtc to balance the realities of the marketplace against the overall benefits that will accrue to chum should these transactions be approved, particularly in the underserved programming categories. Should these applications be approved, they will give chum access to 84% of television households in Ontario ­ a market that remains attractive to most advertisers.’

As for the Baton proposal, the cftpa is siding with the dgc in offering qualified support. McDonald says she expects to see a comprehensive programming strategy from Baton by ctv’s licence renewal hearings, one which ‘includes a significant contribution to ‘high-quality, identifiably Canadian programming at 8/10, 9/10 and 10/10 levels.’

Regional benefits

While the big picture questions on benefits will resurface at the November hearings on national network criteria, regional producers are inspired by the offerings contingent on the deals at hand.

Maritime Production Services’ Robert Bongard and Yvonne Mosley made the trek to Hull to support the bbs/chum swap proposal, which includes a $2.3 million investment in the Atlantic region to set up a regional production office and a script and concept development fund.

Responding to a question from commissioner Andree Wylie on whether he was satisfied with the financial investment Baton was offering, Bongard inspired chuckles with ‘Producers are never happy with the amount of money,’ but added that access is everything for the Maritime community.

‘We’re a tough lot. We can be told our ideas are no good. What we can’t stand is nothing happening.’

Front and center to the Baton/Electrohome merger side of the equation is a $10 million benefits pack over five years. Of the pie, $4 million will go to news gathering and facilities, mostly to the Western group of stations, and includes one digital camera and a digital edit suite in Edmonton.

The remaining $6 million will create the Baton Signature Presentations, a series of specials on ‘the difficult issues of our time.’ A minimum of one production a year is guaranteed with 50% of the overall expenditure going to independent producers. The format could range from docudrama and miniseries to variety and fund-raisers.

To questions from commissioner Gail Scott on what the maximum number of productions would be, diluting what is theoretically a $1 million-plus budget per, Baton coo Bruce Cowie says the scope of the productions makes it difficult to do more than one a year. ‘Safe to say it will be small in number.’

The chum deal, via the acquisition of chro-tv Pembroke, cfpl-tv London, and its affiliated stations, will trigger a $1.9 million script and development fund, the CHUM Television Canadian Programming Fund.