Cutting ads on CBC/Radio-Canada would be "devastating": Nordicity report
November 28, 2011
OTTAWA – Banning advertising from CBC/Radio-Canada would not just be bad public policy, it would result in serious ramifications for advertisers and the country’s independent production sector, says a new study from Nordicity Group Ltd.
The study, released Monday by CBC/Radio-Canada at the IIC Canada’s pre-conference on public broadcasting, seeks to quell the debate around whether the public broadcaster should rely on airtime advertising as a source of revenue to finance its operations.
Called ‘Why Advertising On CBC/Radio-Canada Is Good Public Policy’, the study estimates that the elimination of advertising from the Corp’s television services would result in a net financial impact of $533 million. Not only would CBC/Radio-Canada lose $368 million in advertising revenue, it would also have to come up with an additional $190 million to fill the extra airtime. In addition, Canadian programming expenditures would drop by $160 million annually, leading to a $150 million overall decrease in independent production activity.
Canadian businesses that rely on the public broadcaster as an advertising vehicle would also suffer from the loss of CBC/Radio-Canada as an option, the study continues. Reduced inventory would translate into an increase in TV ad rates, especially in smaller markets.
Nordicity also noted that most public broadcasters around the world carry advertising or are engaged in commercial activities, and that there is no correlation between the use of advertising revenue and the amount of public funding a public broadcaster receives.
President and CEO Hubert T. Lacroix said that the elimination of advertising revenues would “seriously compromise” CBC/Radio-Canada’s ability to fulfill its mandate and roll-out initiatives contained in its five-year strategic plan ‘2015: Everyone, Every Way’.
“Private and public broadcasters compete on many levels in our mixed public-private system, but each has a contribution to make,” Lacroix said in a statement. “The national public broadcaster has access to advertising revenues to help meet Broadcasting Act objectives, while private broadcasters have, most notably, access to public subsidies to help them meet Canadian content requirements.”