All Articles

Rogers Argues Against Consumer Tax

    TORONTO, April 20 /CNW/ - Canada's television industry is not in crisis,
Rogers' representatives told Parliament's Heritage Committee today in Ottawa.
CTV and Canwest/Global assertions are simply wrong, according to Rogers. CTV's
operating profits from television last year were in the $200M range. Canwest's
were $164M.
    Phil Lind, Vice Chairman of Rogers Communications Inc., stated that "Both
CTV and Global have profitable television operations. And contrary to claims
made by CTV and Canwest, their broadcast assets should be valued as the sum of
their parts, not as though each segment were a standalone business." In 2007,
CTV and Canwest spent $1B to acquire Chum and Alliance Atlantis respectively.
    Rogers argued against the notion of fee for carriage which has been
advocated by CTV and Canwest and has twice been rejected by the CRTC in 2007
and 2008. Fee for carriage was exposed "as nothing more than a tax on
consumers." The fee would be paid by consumers of cable and satellite
companies for over-the-air television signals which are available
free-of-charge today to anyone with an antenna. Rogers Cable customers would
be penalized for subscribing to cable.
    "Fee for carriage would set up the worst of all public policy solutions,
a two tier taxation system. Those who subscribe to cable or satellite would
pay more, a lot more, while those who receive television via rabbit ears or a
roof-top antenna, would pay no consumer tax, and continue to receive free
over-the-air local television. Such a system would be patently unfair," said
Mr. Lind.
    Rogers Cable currently provides a number of advantages to the
over-the-air television networks: guaranteed carriage and a priority position
on the cable dial which expands local coverage areas for the over-the-air
services and increases viewership; and financial support of programming
initiatives of over $50M per year. In addition, the industry provides
simultaneous substitution which ensures Canadian broadcasters have exclusive
carriage rights for U.S. shows and on a yearly basis is valued at $300M.
    Rogers summed up its position by stating that the current advantages
provided to over-the-air broadcasters are sufficient and another tax to boost
one business division of an otherwise profitable integrated business entity
was unfair to consumers and bad public policy.

    Rogers is a diversified Canadian communications and media company. We are
engaged in wireless voice and data communications services through Wireless,
Canada's largest wireless provider and the operator of the country's only
national GSM/HSPA based network. Through Cable, we are one of Canada's largest
providers of cable television services as well as high-speed Internet access
and telephony services. Through Media, we are engaged in radio and television
broadcasting, televised shopping, magazines and trade publications, and sports
entertainment. We are publicly traded on the Toronto Stock Exchange (TSX:
RCI.A and RCI.B) and on the New York Stock Exchange (NYSE: RCI). For further
information about the Rogers group of companies, please visit