Thursday, March 26, 2009

Media: New Financing Model for CBC

TORONTO, ONTARIO - Today, the consequences of the $171 million shortfall at CBC/Radio-Canada became known. $125 million in assets will be sold and leased back, and about 800 jobs will be eliminated, evenly divided between English and French programming. Fewer episodes of many popular CBC Television series will be ordered, sports and children's programming will be curtailed, certain regional news programs will be shortened, and five radio programs will be canceled entirely: The Inside Track, Outfront, The Point, In the Key of Charles, and The Signal. Noontime regional programs on Radio One will be shortened from two hours to one (which has little impact on areas like Manitoba where the program is already just an hour long).

The move did not come as a result of a funding cut by the government. While suspicions persist that the Conservative government would love to eliminate the CBC, Federal funding remains unchanged at about $1.1 billion. In fact, the government confirmed today that the "special transfer" payments of $60 million a year would continue, preventing further cuts beyond those announced today. What the government refused to do was to provide special "bridge financing" to the CBC during the recession. The CBC had requested such advances on future subsidies as a way to avoid cuts during the recession.

The reason that the CBC is having to cut back is the same reason that most mass media, from newspapers to broadcasters, are suffering right now--reduced advertising revenue. That's right, advertising purchased for airing during CBC Television (and its French equivalent) is down by about $171 million a year as a result of the recession, and, as a result, everything from one-person news bureaus to Robin Brown's long-running radio show on the human side of sports will disappear.

Radio people--where I usually count myself--are upset by the fact that reduced television advertising revenue is resulting in cuts to radio, especially at a time when Radio One is achieving record listenership in many markets. They are probably mollified by the fact that a rumored introduction of advertising to the radio stations will not take place, but with even surviving programs subject to cutback ("The Current" reportedly has had its budget cut by 10%) there will be a loss of quality across the board. The argument goes that the cheaper radio network should be subsidized and more expensive television should be budgeted out of its own advertising.

I don't believe that the CBC should be pitting radio versus television (or against, which is the only division not facing cuts), but the whole organization needs a whole new form of financing that isn't so dependent on ad revenue or politics. On that point, I agree with many conservatives. I completely disagree with their solutions, which are usually subscription services or voluntary payments in the manner of public radio in the United States in which the CBC becomes like any other media product. Part of the CBC-Radio Canada mandate is to promote Canadian culture, to teach Canada about itself--including its history, which seems to have gotten little attention of late. It can't do that in a fee-for-service-type environment.

What the CBC really needs is an endowment. To create an endowment that will be able to provide $1.7 billion a year will take years, but that's all the more reason to start to build it. Part of the money should come from the government, but much as public radio has received significant endowment gifts in the United States, foundation and other contributions can be solicited. If it is made clear that the purpose is to create a stable, permanent Fourth Estate and Canadian cultural resource, the money will come, even if it takes ten years. CBC-Radio Canada needs to remain a crown corporation for the sake of accountability, but the bulk of the budget should not come from government, nor from advertising that takes a nosedive in a recession.

Could this really be pulled off? I'm not sure, but what became clear today is that the current system is broken, and it can't just be blamed on the current government. Something needs to be done to secure the future of CBC-Radio Canada, and it needs to be done before another round of cuts become necessary.

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