The TV War Rages On

There is, for all intents and purposes, an active campaign taking place in Canada. Maybe not a political one, but it's a hard-fought, divisive, choose-a-side campaign to be sure.

Let's see if I get this right.

One minute, a commercial airs talking about rich cable providers stealing local TV signals like CTV and CBC and paying nothing. Please support local TV, it says. Brought to you by the folks at the TV stations.

The next minute, another commercial airs talking about greedy local stations wanting to charge us consumers a monthly $10 TV tax even though they made lots of profits already. Say no to the TV tax, it says. Brought to you by the cable providers.

The purpose of each commercial is to discredit the claims of the other, and it's becoming a sticky situation: both commercials make excellent points, but don't give all the necessary information one would need to generate an informed opinion one way or the other. Taking information from the "fact sheets" on the respective web sites, I'll try to explain it a bit further.

I'll begin with the local stations, since they drew first blood in the campaign, and I'll use CTV as an example. Their argument is relatively simple; CTV broadcasts our local news from affiliate stations all over the country. When you subscribe to cable or satellite (I'll use Eastlink as an example), you're paying for all the channels included in your package, which always includes CTV.

The point of contention is that Eastlink doesn't have to pay CTV anything for airing their channel, even though many people might be subscribing to that package specifically to get CTV. CTV argues that they should be able to negotiate appropriate compensation from the cable and satellite companies for the distribution of the local stations' signal. They just want to be paid for their product by the people who use and re-sell it.

On the other side of the coin, cable and satellite companies point out that CTV is available for free (remember a bunny-ears antenna on top of your television set? That still works, even though few people go that route). How can you be accused of stealing something that is not only free, but that Eastlink is obligated by law to carry?

Also, the carriage of CTV by Eastlink allows broadcasting in a higher quality format and to a far larger number of customers than would be possible through over-the-air transmitting. This enables CTV to charge more for ad minutes and make more money, which cable companies argue is compensation enough. If CTV keeps pushing the CRTC to amend the current policies, a tax will likely be implemented, which would be absorbed by the customers.

See the problem?

CTV is right. If cable companies are using their signal and re-selling it to us, CTV should see some of those profits. While I don't agree with local stations using the "save local television, we're going bankrupt" speech (together the big television companies boasted a $400 million dollar profit last year alone, between local stations and specialty channels), they make a good point: if you're charging for something we provide, we should get a cut. If Eastlink was airing CTV for free, fine; but since cable bills have risen to more than four times the cost of living in the past five years, I'd say shelling over a few bucks to CTV might only be fair.

But, Eastlink is right, too. If everyone decides to revert back to rabbit-ears tomorrow, they'll get CTV for free. Cable and satellite companies are merely redistributing the signal because the CRTC gives them no choice, so why should they have to pay for something that has always been, and likely always will be, free? Especially since it is of great benefit to CTV for Eastlink to carry their signal, as far as advertising and distribution is concerned?

Fact is, neither side is wrong; if Eastlink wasn't legally required to carry CTV and is was dealt with just like a specialty channel (like TSN and The Food Network), Eastlink could offer CTV only to those customers who wanted it, and charge accordingly. That way, Eastlink and CTV would both make money and the product used would be paid for fairly.

Unfortunately, just about any solution to this problem will pass an additional cost onto us, the viewers. Whether it be this mystery "TV Tax" or some other imposed fee, what doesn't seem fair is that it will be shouldered by people who do not post yearly profits in the millions of dollars.

As for me, I think Steve Murphy should just take a pay-cut. Problem solved!
(You can visit www.localtvmatters.com and www.stopthetvtax.com for more information on the debate.)