Corus has asked the CRTC to clarify whether Global could access funds earmarked for local news to avoid “competitive disadvantages” and make up for lost funding following the Rogers-Shaw merger.
In a letter to the CRTC dated May 10, Corus sought guidance from the CRTC about whether or not its Global stations would be eligible to receive funding from the Independent Local News Fund (ILNF) in order to “sustain generally unprofitable news programming at current levels.” The letter also confirms that $13 million in annual funding that Shaw previously provided to 15 Global News stations would now be redirected to six CityTV stations owned by Rogers.
BDUs in Canada are obligated by the CRTC to support local journalism in Canada, which they fulfill both with their own news operations and through financial contributions to the ILNF, to the tune of 0.3% of its gross revenues. When Corus was spun off from Shaw in the late 90s, the CRTC mandated that Shaw continue to provide funding to Global News.
But as a result of the Rogers-Shaw merger, Rogers will not maintain that funding, as its obligations are fulfilled with CityTV. During CRTC hearings regarding the merger, Corus raised concerns about how this funding would impact its news operations, with other intervenors also pointing out that Global served many smaller markets that CityTV did not, particularly in Western Canada. The CRTC would approve the merger, but among its conditions was that Rogers employ more journalists, create a Western Canada news service and add two Western Canada-based journalists to CityNews’ Parliament Hill team.
The Independent Local News Fund, since being established in 2016, has largely been earmarked for news stations not owned by one of Canada’s major BDUs and operating in under-served communities. But Corus said in its letter that its 15 Global stations are the only conventional news broadcasters without access to regulated funding, meaning the company has been left with “no alternative but to pursue” support through the ILNF.
The traditional broadcast business model in Canada was such that broadcasters could lose money on news coverage as a way to build relevance with local audiences, which would help with ad revenues in other areas of its business. But “in recent years these internal supports have collapsed,” Corus said in its letter, noting a 9% decline in ad revenue from September 2022 through February 2023.
“On numerous occasions, the CRTC has acknowledged that the economics of local news are most precarious in small and mid-sized television markets,” the letter said. “However, the Commission should also note that the $13 million formerly allocated to 15 Global stations will soon shift to just six competitor stations, all of which operate in metropolitan markets […] Corus acknowledges Rogers’ legitimate interest in supporting its affiliated CityTV stations, but notes with concern that Global newsrooms operating in the same markets – to say nothing of vertically integrated CTV stations and publicly funded CBC stations – will operate at an undue competitive disadvantage.”
Corus also said that while it is currently in the midst of a company-wide “cost review” to help it towards long-term financial sustainability, in the short- to medium-term, “it will not be possible to sustain generally unprofitable news programming at current levels in 15 local markets” without access to the ILNF.
