Canada's broadcast regulator mounted a vocal defence of television journalism Wednesday, while slamming the executives who run the stations as wealthy yacht-owning complainers who are out of touch with changing audiences.
CRTC chairman Jean-Pierre Blais said he is tired of broadcast executives coming before his committee to tell him the "cupboards are bare," and that they can no longer afford to fund local news without government subsidies.
"Local television news is failing us. But it need not. The system sits at a position of strength," Blais said in a luncheon speech at the Canadian Club in Toronto. "In 2014, TV stations spent more than $470 million on local programming and news … the industry is rich in resources.
"I listened as Canadians spoke with intelligence and passion [about local TV news], while corporate executives who own luxury yachts and private helicopters came looking for subsidies," Blais said.
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The CRTC has held a number of hearings on the future of local TV in recent months, and regulators are studying whether changes are necessary to preserve local news coverage.
Many stations have found their traditional financial model under threat amid a changing landscape for advertising and consumer viewing habits.
A recent report warned nearly half of the country's local TV stations could be off the air by 2020 without a boost in revenues to pay for local programming.
The industry has been hobbled by the loss of the Local Programming Improvement Fund (LPIF), which was established during the 2008 market downturn to help struggling local stations. The fund was paid for through a levy on cable and satellite subscribers.
The fund paid out about $100 million annually to private broadcasters and CBC stations, but the CRTC phased it out in 2012.
Executives 'just complaining'
In 2015, the CRTC also made controversial changes to Canada's cable and satellite television packages. Starting in March, subscribers will be able to purchase a "skinny basic" package for a maximum of $25 a month; customers will be able to add individual pick-and-pay channel options after that.
Broadcast companies have warned that doing away with channel "bundling" will render many TV channels financially unviable, resulting in at least 1,000 layoffs.
"[The executives are] just complaining. They're forecasting doom and gloom: job cuts, revenue losses, station closures. They run off to court, they run off to cabinet to seek relief. It's their right to do so, but it doesn't make them right," Blais said.
The regulator said broadcasters have panicked at the sight of technological change, and have needlessly cut coverage and newsroom staff to the bone to the detriment of the audience.
He said cutbacks at CTV News, Hamilton-based CHCH and Rogers Media-owned OMNI TV is a worrisome trend that ignores the important role broadcast journalists play in a vibrant democracy.
"I fear those who manage media — the corporate executives, accountants, lawyers and MBAs — have lost touch with their audiences. Analysts on Bay Street focus on quarterly results, profits, balance sheets, share prices and other calling cards of private wealth.
"They do not care nearly as much about the health of costly endeavours that preserve the wealth of our democracy," Blais said.
The chairman pointed to the success of Quebec-based newspaper La Presse — which has done away with its weekday printed product in favour of a robust suite of online options — as an inspiration for other media companies who are dealing with disruptive internet technology.
"Corporate executives cannot bury their heads in the sand and pretend that change isn't happening. They must rise up and meet the challenge of a new content era head on."
Fourth estate threatened
Blais said he is "not convinced" that citizen journalism and social media platforms like Twitter and Facebook will ever be able to challenge the supremacy of legacy news organizations.
"If the journalist — trained to professional standards, who subscribes to a particular code of ethics, and who aspires to the highest standards for gathering and interpreting facts to create valuable, intelligent news analysis — disappears, in the absence of a proven alternative, I fear the future of the fourth estate as a pillar of democracy will be at risk," he said.
The regulator also took aim at the business model of private television channels that rely on American-made programming to boost the bottom line.
"The old way of doing business — of squeezing every last drop of profit out of simultaneous substitution and rented, made-in-America content — is no longer sustainable. Truly great content is what draws viewers. Those that make that content will thrive."