Cable companies balk at broadcasters' demand for signal fee

Cable companies are outraged over the request by CTV, Canwest Global and Quebecor to the federal government that cable firms should pay a fee to broadcast their signals.

The private broadcasters say a slump in advertising revenue will mean more cuts in local programming and shutdowns of TV stations unless they can get more money elsewhere.

Quebecor Media president Pierre Karl Péladeau, who appeared before the Commons Heritage committee Monday, warned that conventional broadcasters could go under.

"We … will see the network dying or go bankrupt," said Péladeau.

Cable companies say the fee — known as fee-for-carriage — would be passed on to consumers and would amount to an unfair levy on them.

Phil Lind, the vice-chair of cable giant Rogers Communications, also appeared before the committee and warned members not to believe the cries of poverty from CTV and Canwest.

"This is little more than self-serving fiction," said Lind.

"Until recently, over-the-air television was a very profitable enterprise. Because it is a cyclical industry, it will be profitable again."

Lind said CTV and Canwest overextended themselves with billion-dollar acquisitions and a bidding war for American programming, incurring their large debts.

"Most of the money CTV and Global spend on programming goes straight to Hollywood," pointed out Lind.

Global and CTV will be arguing their cases on Wednesday.

The fee-for-carriage idea has been rejected twice by the Canadian Radio-television and Telecommunications Commission (CRTC).

CRTC chair Konrad von Finckenstein recently said such a fee would only be a temporary solution to the financial woes of broadcasters.