CRTC Turns Off Local Programming Fund
The CRTC has decided to terminate the Local Programming Improvement Fund (LPIF).
As a result, cable and satellite company LPIF contributions will decrease over time to zero. Some consumers of cable and satellite television services will see an adjustment in their bills, and some local television stations will see a reduction in their revenue streams.
The Canadian Radio-television and Telecommunications Commission says that a “recovery in the advertising sector and the successful transition to digital television” shows that the LPIF fulfilled its purpose. Following a public hearing held April 16-20, 2012 to review the Fund, the CRTC decided the program has fulfilled its purpose and will be phased out by August 31, 2014,
As a way to help minimize the effects of eliminating this source of funding for local stations, a gradual phase out of the fund will take place over the next two years.
This will provide conventional stations with sufficient time to adapt to the evolving broadcasting environment, the CRTC says. Television stations in these markets are required to air local programming. Given that their economic situation has improved, the CRTC is confident that stations will maintain the same quality of programming.
During hearings and presentation on the LPIF, local broadcasters had another perspective.
Independent broadcasters like B.C.-based CHEK Media Group and Hamilton’s Channel Zero Inc. told the CRTC that LPIF funding was “essential” to their survival and growth.
The CBC also argued against shifting monies away from local programming funds, but the public broadcaster anticipated the change and said it would maintain its program objectives and mandates.
The LPIF was launched in 2008 to support local programming by stations in non metropolitan areas, hit hard by the recession. In 2010, 78 stations received funding totaling $100 million. In 2011, 80 stations received $106 million in funding, based on contribution s made by TV service providers.
Some cable and satellite companies passed the costs of the LPIF on to their customers. As LPIF contributions are reduced and eventually eliminated, these companies’ customers can expect a corresponding reduction in their cable or satellite bills. A list of LPIF eligible stations is online.
Cable and satellite companies are required to report what measures they have taken to ensure that these reductions are reflected in the bills of affected consumers. Companies must submit these reports to the CRTC by September 17, 2012.
CEP, the Communications, Energy and Paperworkers Union of Canada, is protesting the decision and its underpinnings.
“In ending the LPIF the CRTC ignored not only the Fund’s critical role in sustaining and strengthening local news across the country but also large broadcasters’ threat to close more TV stations,” Peter Murdoch, Vice-President, Media, CEP, said in a statement.
He noted that last April, service providers Bell and Shaw told the CRTC that seventeen of their TV stations were unprofitable without the LPIF. “Since the CRTC has ignored repeated requests to mandate local news on TV, this decision will lead to job losses and ongoing threats of TV station closures,” added Murdoch.
CEP notes that the only evidence that the CRTC used to support this decision was from Canada’s largest cable or satellite companies, not the citizens the CRTC was created to serve. Over 1300 individuals, unions, associations and companies filed submissions about the LPIF – largely to support the Fund and local news – but the CRTC’s policy quotes Rogers, Bell and Shaw fifteen times.
Opinion and position statements from dissenting and concurring CRTC Commissioners were tabled as part of the decision.