BGM’s Fecan named Playback‘s
Person of the Year
As federal regulators ponder Bell Globemedia's $1.4-billion purchase of CHUM, the architect of the landmark deal - its president/CEO Ivan Fecan - has been named Person of the Year by Playback, Canada's preeminent film and television production journal.
A self-made maverick in an industry dominated by generations of Griffiths, Shaws, Rogers and Bassetts, Ivan Fecan has broken the mold and built his own multimedia family – average age just under 30 – from scratch, recently adding CHUM Limited from the Waters family in a deal worth $1.4 billion.
The modern incarnation of CTV under Fecan began with his move to Baton Broadcasting in 1996, following ‘Big John’ Bassett and his son Douglas into the president/CEO chair. But it was Fecan who engineered a series of joint ventures and acquisitions that changed a divided co-op of CTV affiliates with 40 weekly hours of programming into a unified powerhouse network, and folded it into a media giant with 21 conventional channels, 17 specialties, The Globe and Mail and myriad other interests.
Trademarks of the Fecan era are creative programming and inspired deal-making, a combination that has paid large dividends for the perennially number one network, which recently notched 16 of the top 20 shows of the fall season. Other recent highlights include CTV scooping CBC for the 2010 and 2012 Olympics, and parent company BGM’s $800-million ownership restructuring geared towards growth, announced in December 2005.
CTV is a new media leader as well, having launched an online broadband service this past spring with sister channel MTV Canada, followed this fall by CTV’s own broadband network, offering its Canadian series and some of its U.S. ones. Meanwhile, BGM specialties TSN and Discovery Channel were the first in Canada to beam their signals out in HD four years ago.
This year saw CTV secure a second feed for TSN, perhaps in anticipation of grabbing NHL broadcast rights long-held by CBC. And in August, the CRTC put its rubber stamp on the ownership changes, officially bringing two new partners – Torstar and the Ontario Teachers’ Pension Plan – to Fecan’s table, chequebooks at the ready. But the real earthquake came before the ink had dried on the stamp.
Fecan got a call from the Waters clan in the summer, on the heels of the passing of patriarch Allan Waters, offering up CHUM to the highest bidder. Pending regulatory approval, Bell Globemedia will become an even bigger media player.
‘I really didn’t plan for any of this to play out this way,’ laughs Fecan, pointing out that he started his career in 1975 as a creative producer on the CBC Radio science show Quirks and Quarks. ‘I enjoy both [business and creative],’ he says. ‘What I don’t want to do is be restricted to one or the other. I honestly don’t know [if] I would enjoy running a non-content business. Maybe it’s just ignorance on my part that I haven’t discovered other things that would excite me.’
About half of his 30-year media career was spent at CBC. Under Fecan’s leadership, the CBC enjoyed a golden resurgence with shows such as Kids in the Hall and Degrassi Junior High. He admits that he learned several important lessons during his time at NBC under the late Brandon Tartikoff. ‘The key point at NBC was ‘stay close to your audience,” says Fecan. ‘Don’t get too fussed by technology or anything else.’
He may not believe in ‘getting fussed’ about it, but Fecan is a noted early technology adopter. His trailblazing broadband deal with Warner Bros. – which brings U.S. shows Studio 60 on the Sunset Strip, Smith and The O.C. online just after they air on conventional CTV – will set the standard for those to come. But his secret, he insists, is that he bases all his decisions on content. ‘Our core strength [at CTV] is developing and acquiring content, promoting it and scheduling, which is a bit of a lost art and shouldn’t work, but still does,’ he says. ‘What platform it ends up on is the next consideration, but it’s all kind of irrelevant if you don’t have things people want to see. It’s got to be that simple.’
At the behest of the CRTC, no less than $140 million of the $230 million from the BCE benefits package resulting from the takeover in 2000 was directed towards priority programming. Since then, the package has run its seven-year course, but CTV has continued paying the full shot on Corner Gas, Canadian Idol and The Juno Awards.
‘[Their success] taught us a lesson,’ says Fecan. ‘If you really believe in it and you can possibly do it without going through the normal mechanisms, your chances are better.’
Despite criticism to the contrary, he’s adamant that reflecting Canadian culture is an important mandate for CTV. ‘I feel a huge obligation – not just as a Canadian – but also as someone that thinks that the long-term business of any media company in Canada depends on having content that’s developed in its own territory that has an audience connection,’ he insists. ‘But if you now say we’re going to water everybody’s production budgets to do a few more series and a few more movies, I think that’s a mistake,’ he says. ‘We risk alienating our audiences with something that we know isn’t as good as we can make it.’
Fecan readily admits that CTV is producing less drama than it was five or six years ago. And whether you buy Fecan’s Cancon philosophy or not, one can’t help but admire the fact that he decided to stay in Canada and build his media empire from Scarborough, and not Manhattan.
Whatever his reasons, change has come fast for Fecan and his multimedia family in 2006. ‘How did we know the Waters family would wake up one day and say, ‘By the way, the company’s on the block, and you’ve got a few days to figure out whether you want to buy it or not,” he says. While satellite radio provides listeners with more choice, traditional terrestrial radio might be a jewel of the deal. As one CHUM insider points out, ‘People forget that we’re a radio company. The radio assets may be smaller from a revenue standpoint than some television, but we’re number one or two in all the markets that we’re in. Our radio stations experience very high ratios with advertisers. We’re industry leaders as far as profitability is concerned.’
Fecan also stresses that CHUM’s specialty dramas are complementary to those of BGM’s CTV. ‘We’re largely in information, sports and youth,’ he notes. ‘They’re largely in youth as well, but have the ability to do dramatic stuff which we don’t have in our specialty.’ His appreciation for CHUM also extends to the conventional side. ‘I love the City brand,’ Fecan says, recalling his days at City when he helped start CityPulse News. ‘I understand that part of the company.’
According to a CHUM insider, specialties Bravo!, Space and MuchMusic have been compensating for weak performance in conventional television properties, something that didn’t escape Fecan’s sharp eye. ‘We thought a lot of strain was put on the City brand because the company was growing so much,’ Fecan says. ‘We might be able to add something to it by letting it be City more often. I love all [the energy and personality], but I think they can use more resources. And we’re hoping we can help them with that.’
CHUM will certainly benefit from CTV’s programming savvy and cross-promotional ability, but will the acquisition affect the City brand – and specifically, will CTV bring its largely American content over to CHUM? ‘I think what they do is the right fit for them,’ says Fecan. ‘I don’t know that you’re going see CTV stuff on City or vice versa. They’re very different brands.’
While the CRTC is hoping to receive BGM’s application by year-end to begin what it calls its ‘completion of information’ stage, the Competition Bureau is already off and running. It’s currently consulting its ‘illustrious list of factors’ (there are 93), which include barriers to entry, competition after the deal, whether the party being acquired is a vigorous and active competitor, market share, et cetera. ‘Typically, when we look at a media merger, we tend to look at advertising markets,’ says Bob Lancop, an assistant-deputy commissioner of the Competition Bureau. ‘For example, if we talk about national markets, we have to determine whether television is a standalone or whether it competes with newspapers for national advertising.’
At the moment, the bureau has retained industry experts and is conducting in-depth callbacks with industry folks. Unlike the CRTC process, which includes a public hearing likely in the spring and a decision in the summer, the ongoing results are confidential. Lancop is optimistic that a decision will be forthcoming early in the new year.
CTV has stated it will offer up CHUM’s six A-Channel stations, one in Victoria/Vancouver and the rest in Ontario, but the bureau will be the first to weigh in on that proposal. ‘We’ll see what the Competition Bureau comes up with,’ says CRTC spokesperson Denis Carmel. ‘They might require divestitures that will change the nature of the application. I remember one instance in an Astral transaction where it radically changed the whole outcome. They run their own process and we run ours. In the end, CTV has to comply with both.’
Carmel says that in addition to divestitures, the CRTC will be looking at diversity of voices in news and information, and tangible benefits. ‘When BCE bought CTV [in 2000] they were required to do eight hours a week of priority programming and they proposed nine hours,’ he notes, recalling the $140 million earmarked for priority Cancon over seven years.
He adds that CTV will this time provide a suggested contribution amount to the system as well as a list of possible recipients. It’s also expected that CTV will once again exceed the minimum on-air requirement for Cancon.
The CRTC’s spring hearing should last a few days, depending on how many interventions there are to the deal, which has divided the industry. The early buzz is that it will have a negative effect on advertisers and media buyers. Says one media buyer who preferred to remain anonymous: ‘CHUM always used to price themselves a little bit under the market. So you could use them to drive down prices from both Global and CTV. Without CHUM there, less flexibility means higher prices for advertisers.’ Given market forces, the buyer adds that since media inflation with three players was in the 5% range, 10% is in the realm of possibility with a market of two.
The full story on why Ivan Fecan was named its Person of the Year appears in the current issue of Playback, now on newsstands.