Cable Co’s getting their Cake and Eating it too!?

 

Does it surprise you that Canadian cable companies reported a 16% increase in revenue in 2008? It surprised the hell out of me. Although I am somewhat biased because I do work for a broadcaster, I just can’t wrap my head around double digit growth from players within an industry that is facing unprecedented economic pressure, billion dollar write downs and sweeping job losses. It’s like Domino’s Pizza being on the brink of collapse while their pizza delivery guys are making money hand over fist! Something doesn’t compute.

Media companies like Canwest and CTV are shedding jobs, cutting costs and lobbying the CRTC for fee-for-carriage in an effort to remedy what many are calling a broken business model. The CRTC has prevented media companies from charging cable companies like Videotron and Cogeco for Canadian television that is distributed to households. Which means that the “manufacturer” is receiving nothing for its product or the syndication of its product. OK, but now factor in some of the other stakeholders affected by the situation. Marketers, ad agencies, productions firms, journalists, editors… all feeling the pinch of today’s economic recession. But yet the cable co’s are growing at 16%!! Wow.

I’m not suggesting we send a lynching mob after the cable companies. After all, what would television be without cable service providers? They go hand in hand and so should the CRTC’s approach to its regulatory structure.  

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