ROGERS GIVES CONDITIONAL SUPPORT TO BCE ACQUISITION OF CTV BUT SAYS NO AGAIN TO VALUE FOR SIGNAL (VFS) /FEE-FOR-CARRIAGE (FFC)
TORONTO, Jan. 12 /CNW/ – Rogers today conditionally supported the
application of BCE to purchase CTV while renewing its opposition to the
proposed introduction of a value for signal (VFS) regime in Canada.
“This proceeding has reopened the issue of VFS,” said Phil Lind, Vice
Chairman of Rogers. “CTV and Global argued for some time that value
for signal was required in order to support the economic viability of
their operations. With both broadcasters being acquired by large
distributors, the rationale for this fee is no longer evident.”
“Going forward, CTV, TVA and Global Television will be owned and
controlled by large, well-financed public companies that also own and
control Canada’s largest broadcasting distribution networks. These are
not corporate interests that require subsidies from ordinary Canadian
consumers,” explained Mr. Lind.
Before it agreed to buy CTV, Bell, supported by Rogers, Cogeco, Shaw and
Telus, had repeatedly argued against the need to hit consumers with
value for signal. Together the five companies challenged the CRTC
before the Federal Court of Appeal arguing that the Commission lacks
the power to introduce a VFS regime.
The economic recession of 2008/2009 with its reduced advertising
revenues is now behind us. Spending on conventional television
broadcasting advertising in Canada is estimated by ZenithOptimedia,
Canada’s largest media buying agency, to have grown at a 7.5% rate in
broadcast year 2009/2010. Total advertising expenditures in Canada in
this sector are expected to return to their 2007 levels in 2011.
The American experience with Fee-for-Carriage is not going well.
American television viewers have been victimized by major disruptions
of their favourite shows as broadcasters pressure distributors to pay
more. There is considerable evidence in the public domain that major
U.S. networks, such as FOX and CBS, are now asking for monthly
retransmission fees of as much as $1.00 per subscriber per signal, with
accelerator fees built into the typical three-year agreements. There
have been dramatic incidents of blacked out signals of major programs
including the Academy Awards and World Series baseball games. Neither
of these outcomes, high monthly fees or blackouts, would be welcomed by
“In light of the changed financial circumstances of the Canadian OTA
broadcasters and the reality of the VFS operation in the United States,
the introduction of a Value for Signal system in Canada makes no
sense,” concluded Phil Lind. “Our support of the Bell application is
conditional upon Bell continuing its previously articulated adamant
opposition to the concept of VFS and not allowing the stations of the
CTV network to seek to enrich themselves (and BCE) at the expense of
Canadian consumers by participating in any future VFS regime.”
About the Company:
Rogers Communications is a diversified Canadian communications and media
company. We are Canada’s largest provider of wireless voice and data
communications services and one of Canada’s leading providers of cable
television, high-speed Internet and telephony services. Through Rogers
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 rogers.com.