A study released by Statistics Canada on Dec. 2 reflects the findings of the CRTC Broadcasting Policy Monitor Report that specialty television and pay-TV services are having a dramatic impact on the Canadian television industry, cutting into the market share of conventional television.

Viewership for conventional stations in Canada has declined 15% since 1992, dropping to 50% in 2001, while revenue generated by specialty television in 2001 totaled $1.2 billion, up almost 14% (17% according to the CRTC) from 2000. According to StatsCan numbers, specialty channels represent 26.6% of the total revenue generated by the Canadian television industry ($4.5 billion). Pay-TV revenues are also climbing, bringing in $286 million in 2001, taking 6.3% of total revenue generated.

The most recent figures from PricewaterhouseCoopers bear out those of the StatsCan study.

In 2001, broadcast accounted for 72% of the total spend on television advertising in Canada, but PWC projections suggest that in 2006 that number will shrink to 67%. In terms of advertising spend in 2001, the growth rate for broadcast was 2.4% and 21% for specialty networks. However, over the next five years, PWC figures predict a compound annual growth rate of 12.6% for specialties and 7.1% for broadcast.

‘The impact of the digitals will be one of the principal drivers in the growth rate of specialty channels. There will be fallout from the current levels; we don’t expect them all to survive,’ says Gino Scapillati, Canadian leader in entertainment and media practice at PWC. ‘The [specialty] networks were already clipping at a pretty high rate of growth in advertising spend, and as a group, including the digitals, that rate of growth will slow, but the market share will increase.’

Similar trends persist south of the border.

According to the most recent figures from PWC, U.S. cable network advertising was up 4% last year, while broadcast networks showed a 3% decline.

The StatsCan study also shows average weekly employment in the television industry falling in 2001 after slight gains the two previous years. The loss of employment, however, is restricted to Canadian television’s public non-commercial segment, where the workforce shrank by 11%. Among private broadcasters in Canada, employment is up 3.7%.