CMDC Media Digest, 2015-2016

The Impact It will promote cord nevers cutters to their own services Whats Next Shomi began to offer their service to all Canadians in September 2015 with Crave to follow by end of 2015 Set Top Box Audience Measurement The industry was required to form a working group to develop an audience measurement system based on settop box data This group will be tasked with proposing technical standards privacy protections and a governance structure as well as determining how costs will be shared The Impact Potentially a new currency for TV based on STB data from millions of homes with real time programming and commercial audience measurement by the second with richer viewer profile information and potentially longer term connected to purchase data and or clients data It is an expensive complicated political process privacy issues coordinating of data from multiple competitors who pays etc that can leapfrog the current TV measurement to be on a level with digital video and those at the forefront around the world Whats Next The working group had their first meeting in April 2015 and filed an initial progress report to the CRTC on June 10 This group is continuing to work through the myriad issues facing them We anticipate that there would be a minimum 18 month timeframe before STB audience data would be introduced Quotas for Canadian Programming There is a reduction in the number of hours and hours by daypart of Canadian programming that conventional television stations and discretionary services must broadcast The CRTC is shifting its focus from the quantity of content to the amount of money invested in this content The Impact The ideal result is fewer but higher quality Canadian programs that garner bigger audiences and have sales potential on the global market The potential negative is that some very good niche content that does not generate a large audience and serves a distinct audience segment may be lost Whats Next This will begin impacting program schedules starting with fall 2015 Genre Protection Genre protection which requires specialty channels such as Food Space or HGTV to broadcast certain types of programming in exchange for shielding them from direct competition was eliminated immediately The only exception to this rule is a continued limit on carriage of mainstream sports programming by other than licensed mainstream sports services which have more specific Canadian production requirements The Impact Elimination of genre protection will grant greater flexibility to broadcasters to create and acquire programming that they consider will best suit their audiences The elimination of genre protection likely means many Canadian specialty channels will face new competition both from existing channels expanding their format offering and with potential to drive the closure of some more niche stations Whats Next We are seeing more program diversity by station The outcome and impact on niche stations will be exacerbated when combined with the announcement on pick and pay service Stage 3 Connect Choice March 19 2015 Three inextricably linked decisions were released with the most significant impact on the dynamics of todays broadcast environment The Impact From a consumer perspective these decisions are perceived as a positive Canadians are enabled to find the right value proposition for their household and pick the specialty stations they want to supplement a new basic service But even the CRTC says that many customers find value in their current first tier offering and may wish to retain what theyve got In the end it will come down to how the BDUs re package and price the new mandated pickand pay offerings How actively large number of consumers make big changes from their current subscriptions particularly when there is no guarantee that choice will not cost them more remains to be seen From a business perspective this will put some downward revenue pressure on the BDUs but the more significant impact will be on some specialty stations Canadian TV content producers that are no longer included in basic cable packages and or automatic bundling Reduced distribution will impact both their subscription fees from the BDUs and their potential advertising revenue due to reduced audiences The changes are likely to make it harder to reach niche audiences as more targeted channels shut down There will be some casualties on the road to more consumer choice REGULATORY NEWS INFORMATION COMMENTARY 25 The Business of Media CANADIAN MEDIA DIRECTORS COUNCIL