Stop the TV tax.

I’ve been so inundated by ads telling me that Local TV Matters, or to Stop The TV Tax, that I finally hit my limit and had to say something.

Canadian networks, like CTV and Global, aren’t making as much money as they used to because – surprise! – their business model is collapsing. In their own words:

Although support from our viewers is strong, local television has been struggling financially for more than a decade, and now we have reached a critical point. Advertising revenues for local stations have decreased and the traditional model of free local television is unsustainable.

Their answer? Somebody else has to give them money. But they are very clear that this isn’t a bailout. They just want someone else to provide them a new revenue stream that they can’t generate themselves. Hmmm, that sure sounds like a bailout.They want cable subscribers to pay them for a product that would be free over the air, just because their model is now broken.

Actually, it sounds a lot like a tax. Cable companies should be forced to pay a portion of all of that money that they make to support local TV. Because local TV matters. Actually in their Facts section they never do get around to explaining why local TV matters. If they think that it is because I might want to watch shows like Flashpoint, Being Erica, Hockey Night in Canada, Entertainment Tonight Canada, Project Runway Canada, Dumont 360 and The Gemini Awards, then they are sorely mistaken.

They like to play a little fast and loose with the truth too:

As it now stands, local television stations give their product to cable and satellite companies for free (we are not allowed to charge them). They, in turn, charge their customers for our service, but pass on nothing to the local broadcasters. This despite the fact that the vast majority of our competitors do get paid by cable and satellite companies for their signal (called ’subscriber fees’).

Yes indeed, specialty channels that were created with subscriber fee models do indeed get subscriber fees.Broadcast television on the other hand was created with an advertising-paid model, thus the 7 minutes of commercial time per half hour show. Cable companies bill to cover two things: the cost of the wired network that delivers the programming to your home, and the subscriber fees for channels that use that model. They don’t charge me for local television service; they charge me to deliver bundles of channels in different tiers.

As a kid I lived a few miles from Buffalo, NY, and got all of my TV over the air.I’ve been a cable customer for over 30 years, primarily because where I’ve lived you simply couldn’t get that many channels over the air. I get the local channels, but the only reason I watch them is because they show American television shows like Big Bang Theory or Grey’s Anatomy. And that is only because when an American show is simulcast on a Canadian network, the cable company switches to the Canadian network, often screwing up a few minutes of the show, and forcing me to watch the Canadian commercials.

Imagine years of being forced to watch the Super Bowl with recycled Canadian commercials rather than the incredible American ones. Happily when we lived in the US we got to watch the real thing.

I may not have always been a happy cable subscriber. The prices have increased substantially, but they do provide a pretty decent selection of programming. But as far as I the viewer am concerned, the local TV networks have been getting a free ride on the cable system. I the customer am forced, without recourse, to watch the Canadian version of any show and the attendant commercials. Those networks get a captive audience, and therefore more ad revenue as a result of more Canadian eyeballs watching a particular TV show. And they sure aren’t watching Being Erica.

If Canadian networks want to force me to pay a TV tax for their programs – and make no mistake, that’s exactly what it is – then I demand the right to eliminate those channels from my cable lineup. I also demand that where a program is simulcast, I am allowed to watch it on the channel I choose.

Here’s my solution: For $10 per month, cable companies can provide a Local TV channel package option for subscribers. Subscribers can then either accept or drop that package option. After all, we are the ones that pay the bill in the end.

If Canadian networks really believe that people think that local TV matters, then they should be happy to allow customers to vote with their wallets.

For some reason though, I really don’t think that they’re interested in giving you and me that kind of choice.

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6 thoughts on “Stop the TV tax.

  1. Since the CRTC deregulated basic cable fees in 2002, they’ve gone up 85% — and the consumer price index has gone up 12%.

    I will not shed one damn tear, ever, for a cable company which has a monopoly over Canada’s largest city and forced me to pay for BET, W, Slice, Spike, and a host of other channels in a “package” just because I wanted Comedy and the Discovery Channel and nothing else. Today, basic cable; tomorrow, maybe rabbit-ears.

    Ted Rogers can suck it, as far as I’m concerned.

  2. Jason, I completely agree with you. I am not happy with Rogers either for the reasons you state. But I also have no intention of letting local television networks get more of my money either.

    I do not watch Canadian stations unless forced to when a US show is simulcast. And I have no problem with them being removed from cable.

  3. The way I look at this. Stop-the-TV-Tax commercials are misleading. Satellite companies and cable companies flexing their muscles. Local television companies are not asking for a charge to the customer… they are asking the cable companies and satellite fees.

  4. Local television companies are asking for a fee for something that is free to viewers currently. That can either come from existing revenue, or from a new customer fee. What company – and remember that they have a duty to maximize shareholder revenue – is just going to sit back and take a hit to their bottom line? They will have to pass some or all of the cost to customers.

    But even if you dislike cable companies, why do local stations deserve a new unearned revenue stream? As a customer, I don’t care about local TV, so why should I be forced to subsidize it? Their business model is failing and instead of finding a new one they want others to subsidize them, and their purchase of US programming. Programming which I can also watch – for free – on US networks.

    If the US networks want money for programming will we be subsidizing them too?

  5. I am a senior citizen and struggle too much already re: paying all kinds of taxes, and I believe we should have a tax relief and also some exemption of them . Thank you for reading my comment.

  6. Jan 10/10

    All of our “Standing up for our rights” didn’t do a thing as usual. According to my new cable bill, the CRTC, once again, could not care less about how we feel. The tax was passed.

    So much for a democratic system. Eh?

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