CRTC changes could mean more funding for local TV news

Financial relief could soon be on the way for struggling local television newsrooms, but that help will come at a cost to community programming.

The Canadian Radio-television and Telecommunications Commission announced Wednesday that it will change the rules around the funding of local content, which could see nearly $67-million redirected into private local newsrooms, from community channels.

The broadcast regulator is also changing local news programming requirements in some regions.

English-language TV stations in metropolitan markets, such as Toronto and Vancouver, must air at least 14 hours of locally relevant programming each week.

In smaller non-metropolitan markets, the requirement will be seven hours per week. 

French-language stations will be required to broadcast five hours of local programming weekly, but that could be increased based on individual community needs.

Changing funding models

In its decision, the CRTC said it will allow satellite and cable providers "flexibility" by rebalancing resources within the broadcasting system. 

Right now, cable and satellite providers must put five per cent of their revenues into the creation of Canadian programming. While that number won't change, how the money is allocated will be adjusted.

Starting Sept. 1, 2017, the CRTC will allow cable and satellite providers that already own television stations, such as Rogers, Bell and Quebecor, to shift a portion of their community programming funding into local news funding instead.

CRTC Chair Jean-Pierre Blais says the decision was based on feedback from Canadians. "Their number 1 priority was local news," Blais said, adding, "instead of putting more money, year after year, into community channels... that money should be allowed to be flexed into local news."

The policy change comes with conditions. If a company chooses to shift more of its Canadian program funding into local news, the company must keep all of its local TV stations on the air. 

Today's decision only applies to private broadcasters and has no impact on CBC funding.

Gap widening

The CRTC says Canadians told the commission they sense a "weakening of the ecosystem for local news," adding they have noticed some broadcasters "shortening the length of newscasts, downsizing newsrooms and centralizing production."

In its decision, the CRTC acknowledged that local news operations are facing a "difficult financial situation," adding: "The gap between the costs associated with producing local news and the revenues derived from this programming is increasing."

Data released by the CRTC shows local news revenues have been falling steadily since 2012. Industry revenues from 2012-13 reached $297-million, but dropped in 2013-14 to $271-million. Revenues fell again in 2014-15 to $266-million.

At the same time, expenditures for local news have grown. In 2012-13 they reached $340-million, jumping to $345-million in 2013-14.  In 2014-15, they increased again to $348-million.

Several news organizations, including the CBC, had asked the CRTC to come up with new ways to help struggling local TV newsrooms.  

During CRTC hearings in January, the CBC proposed the creation of a new fund to encourage broadcasters to produce more than basic local news coverage. 

Industry-wide concerns were raised in 2012, when the CRTC announced it would be ending the Local Programming Improvement Fund.

The $100-million fund was created in 2008 to help local TV newsrooms struggling with declining advertising revenues during the global economic downturn.

The LPIF was considered controversial at the time, as the CRTC ordered cable and satellite providers to pay into the fund. Some providers passed that fee onto customers.

Boost for independent news

The fund will be earmarked for TV stations in 18 communities across the country.

That cash could mean the difference between producing local newscasts or going off the air completely for struggling stations like Global-affiliated CKPR and CHFD in Thunder Bay, Ont.

An executive from the stations told the CRTC in January they would shut their doors by Sept. 1 unless they received help to pay for local programming.

The stations have been staying afloat using money from life insurance policies taken out on a station owner and a general manager who passed away, Don Caron, vice president and general manager of Thunder Bay Electronics told a CRTC panel.

The regulator heard similar financial woes from numerous stations that are part of the Small Market Independent Television Stations Coalition.

Last March, the CRTC turned down a request from the coalition for emergency interim funding.

New technology has given Canadians greater access to both local and international news. But advertising revenue streams have been flowing into digital news outlets and away from traditional TV stations, forcing them to cut hundreds of jobs to remain profitable.