p2pnet - rss feed: Advertisers won’t pay for HDTV
p2pnet.net News:- Advertisers aren’t willing to foot the bill for a shift from TV ordinaire to HDTV with new infrastructure and programming costs that are roughly 25% higher. And that means broadcasters are having to pay for it, says the head of the CBC.
Speaking at the opening of a two-week Canadian Radio-television and Telecommunications Commission hearing into the state of Canada’s television sector, “There’s no evidence either in Canada or the United States that we have found for advertisers willing to pay a premium for a program that’s in HD,” said CBC president Robert Rabinovich, according to The Globe & Mail.
The CBC, which gets slightly more than half its revenue from commercials and the rest from government funding, “painted a dire financial picture for the industry,” as audiences migrate to other forms of entertainment such as the Net, “and advertisers follow the migration”.
So the CBC is, “arguing the regulator should allow the conventional broadcasters to start charging cable and satellite companies to carry their signal,” says the story, going on that feeds from conventional broadcasters are currently provided free but specialty cable channels, “are allowed to collect a fee as compensation for their lower placement on the dial and, arguably, the smaller ad revenue they attract because of their channel location”.
“All broadcasters are pushing for these fees to be introduced, which could increase a monthly cable bill by between $3 and $7 by some industry estimates, depending on what the rate is set at,” says The Globe & Mail, adding the CRTC would require the networks to pour more funding into Canadian content and productions if it did agree to the fee.
The CBC said it supports that concept.
“CRTC commissioners questioned CBC executives over whether the networks were using the fee concept as a way to get the regulator to ’skate them back onside’ in terms of profitability,” says the story, adding, “Mr. Rabinovich said no, because costs are going up regardless due to HD content, while ad revenue is falling.”
“We believe that private conventional television stations should receive subscriber fees to help ensure that we have access to a steady stream of funding,” Bloomberg News has CanWest ceo Leonard Asper saying. CabWest owns the Global Television network.
Asper also wants Canada to head in a direction similar to the US, where it now often seems that programming appears in between ads.
“CanWest also is lobbying for more advertising time, saying product placement in its shows shouldn’t count toward the 12 minutes of ads the company is allotted under CRTC rules,” says the story, going on:
“CanWest and other broadcasters argue that new technologies, such as people using personal video recorders to skip ads, are forcing them to charge less to advertisers and that product placement, or ads contained in a show, would help them deal with this phenomenon.”
Cable and satellite providers, who are opposed to the fee idea, are scheduled to speak Wednesday and Thursday.
Also See:
The Globe & Mail - No business model for HDTV, CBC tells CRTC, November 27, 2006
Bloomberg News - CanWest Seeks More Money, Ads From Canada’s Regulator, November 27, 2006
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