The Broadcasting Environment and CBC/Radio-Canada

1
The Broadcasting Environment and
CBC/Radio-Canadas Audience Performance
Prepared for Hubert T. Lacroixs Appearance
Before the Heritage Committee on April 27,
2009 Ottawa
2
Table of Contents

• Overview of the Broadcasting Industry
• Financing the Broadcasting Industry
• The English-Language TV Market
• The Francophone TV Market
• Emerging Technologies in the Video World
• CBC Radios Audience Performance
• Radio-Canadas Audience Performance
• Emerging Technologies in the Audio World
• Internet
• What the Public Says

3
Overview of the Broadcasting Industry
1
4
A 14.2 Billion Dollar Industry
1. Overview of the Broadcasting Industry

• A mixed private/public system
• Employing some 53,000 Canadians
• Main sectors of activity include
• Television
• Radio
• Distribution (Cable Satellite)

Source CRTC2B of TV distribution revenue is
paid to specialty TV broadcasters
Source CBC/Radio-Canada Annual Report 2007-08,
Staff at March/09
5
Television The Key Players
1. Overview of the Broadcasting Industry

• Operating revenues totaling over 6.0 billion
• 22,000 employees
• Main players
• CTVglobemedia
• CBC/Radio-Canada
• CanWest
• Astral
• Corus
• Quebecor
• Rogers

Source Private estimates based on CRTC Broadcast
Policy Monitoring Report 2008, CBC/Radio-Canada
Annual Return to CRTC
6
There Has Been an Explosion of Choice
1. Overview of the Broadcasting Industry
438
349
282
Source Nielsen Media Research, BBM
7
With Ownership Concentrated in Few Hands
1. Overview of the Broadcasting Industry
5 Billion in Mega Mergers Approved in 2007
French Television
English Television
Based on 2007 Television Revenues (excludes
CBC/Radio-Canada appropriation)
8
1. Overview of the Broadcasting Industry
Usage of TV Has Remained Strong, Despite the
Growth of the Internet
Weekly Per Capita Hours of Viewing to
Television All Persons 2, 1987-1988 to 2007-2008
Source BBM, Nielsen Media Research, Statistics
CanadaAs of 2004-05, data are the results of a
fusion of Mark II and PPM data. This has inflated
per capita viewing over previous years
9
Radio Providing the Local Connection
1. Overview of the Broadcasting Industry

• Operating revenues totaling 1.8 billion
• Main players
• CBC/Radio-Canada
• Astral
• New Cap
• Corus
• Rogers
• CTVglobemedia (CHUM)

Source 2007 Broadcast Policy Monitoring Report
10
Deregulation Has Led to Growth
1. Overview of the Broadcasting Industry
Total Revenues and PBIT Margin of Private Radio
Radio Deregulated
11
And a Highly Concentrated Industry
1. Overview of the Broadcasting Industry
Which Became More so With Astrals 1.1 Billion
Purchase of Standard Radio (September 2007)
Private Radio BEFORE
Private Radio AFTER
Based on 2006 Total Radio Revenues
Based on 2007 Total Radio Revenues
12
1. Overview of the Broadcasting Industry
There Has Been Some Slippage in the Usage of Radio
Weekly Per Capita Hours Of Listening To Radio All
Persons 12, 1987 to 2008
Source BBM (Fall Sweeps)
13
Distribution 90 of Canadians Pay for TV
1. Overview of the Broadcasting Industry
Source Nielsen Media Research, BBM
14
5 Companies Account for 90 of Subscribers
1. Overview of the Broadcasting Industry

• Now the largest segment of the broadcasting
  industry
• A 6.1 billion dollar industry
• Major players
• Rogers
• Vidéotron
• Bell TV
• Shaw / Star Choice
• Cogeco

15
Financing the Broadcasting Industry
2
16
2. Financing the Broadcasting Industry
How Is the Industry Financed

• Subscription revenues are now, by far, the most
  important source
• The various sectors rely on different revenue
  sources
• Note, this does not include the contribution of
  CTF and Tax Credits

Source Statistics Canada 2007
17
2. Financing the Broadcasting Industry
Advertising on Conventional Television Is Flat
and Expected to Decline
Source TV Basics (1996-2007) CRTC (2008) and TD
Newcrest forecast (as of January 2009)
18
However, the Current Economic Crisis Has Hit
Conventional Broadcasters Particularly Hard
2. Financing the Broadcasting Industry
Growth of Conventional TV Advertising (Broadcast
Year-to-Date Change vs Prior Year)
10.0
Broadcast Year 2008
Broadcast Year 2009 (YTD)
8.0
Conventional TV advertising struggled to grow in
2008
6.0
4.0
2.0
0.0
and dropped precipitously when the economic
crisis hit.
-2.0
-4.0
-6.0
-8.0
Jul-08
Jan-08
Apr-08
Jun-08
Jan-09
Sep-07
Oct-07
Nov-07
Dec-07
Feb-08
Mar-08
Aug-08
Sep-08
Oct-08
Nov-08
Dec-08
Feb-09
May-08
Source TVB TSS Advertising Tracking Reports
(Released April 2009 with broadcast (Sep. - Aug.)
year to date (YTD) February 2009 results)
19
Advertising An Important Part of Our Funding
2. Financing the Broadcasting Industry
Revenues and operating sources of funds -
CBCRadio-Canada 2007-2008 (millions of dollars)
20
But Our Advertising Revenue Has Weakened
2. Financing the Broadcasting Industry

• Advertising is vital to the operations of our
  television networks
• It represents 50 of CBC Televisions budget and
  40 of Télévision de Radio-Canadas
• And like other conventional broadcasters,
  CBC/Radio-Canadas advertising revenue has
  weakened

CBCRadio-Canadas Advertising Revenues
1990-2008(Dollars in millions and in 2008
constant dollars)
21
2. Financing the Broadcasting Industry
While Our Appropriation Has Remained Flat for
Many Years

• Our government appropriation has declined by
  almost 400 M since 1990

CBCRadio-Canadas Parliamentary Appropriation
1990-2008(Dollars in millions and in 2008
constant dollars)
22
The English-Language TV Market
3
23
Almost Three-Fifths of All Viewing Occurs Within
the Digital Universe
3. The English-Language TV Market
Distribution Of Viewing to English TV by Viewing
Environment Monday-Sunday, 24 Hours
DTH (Satellite)
24.3
Digital Cable
58.2
Analogue Cable
Off-Air
September to August
Source BBM Nielsen
24
Those With the Most Choice Watch More TV
3. The English-Language TV Market
Weekly Per Capita Hours of Viewing to Television
by Environment ANGLOPHONES September 2007 to
August 2008
Source BBM Nielsen
25
And They Enjoy a Multitude of Programming Choices
3. The English-Language TV Market
A LOOK AT FRAGMENTATION Share of Viewing to
English TV All Day (24 Hours)
September 2007 to August 2008Source BBM Nielsen
26
But These Choices Dont Emanate from Diverse
Ownership
3. The English-Language TV Market
Share of Viewing to English TV All Day, 24
Hours
August 27, 2007 to August 31, 2008 Source BBM
Nielsen
27
Increased Viewing to Specialty/Pay Has Impacted
Viewing to Conventional TV
3. The English-Language TV Market
Share of Viewing to English-language TV Station
Groups, Prime Time (7 p.m. to 11 p.m.)
CBC
CBC
CTV
CTV
Global
Global
Other Canadian Conventional
Other Canadian Conventional
Specialty/Pay
Specialty/Pay
US Conventional
US Conventional
Excluding Affiliates in own time Source BBM
Nielsen
28
Top US Programming Remains the Most Popular
3. The English-Language TV Market
Top 10 Series on English TV2007-2008 TV Season
PROGRAM American Idol 7 Performance American
Idol 7 Results Survivor China House Greys
Anatomy C.S.I. Miami C.S.I (Thursday) Desperate
Housewives C.S.I (Monday) Dancing With The Stars
5 - Performance
NETWORK CTV CTV Global Global CTV Global CTV CTV C
TV CTV
RANK 1 2 3 4 5 6 7 8 9 10
AMA 2,521,000 2,340,000 2,194,000 2,075,000 2,015,
000 1,967,000 1,958,000 1,910,000 1,897,000 1,894,
000

Note Prime time shows only, August 2007 to
April 2008. Excludes CTVs Canadian Idol which
ended in mid September.Source BBM Nielsen
29
CBC Television Remains the Home of Canadian
Content
3. The English-Language TV Market
English Conventional TV Canadian
Programming Prime Time
September 2007 to August 2008 Source BBM
Nielsen
30
Top 20 Canadian Drama/Comedy Series
And the Network Airing the Most Popular Canadian
Drama/Comedy Series
3. The English-Language TV Market
RANK 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
19 20
NETWORK CTV CBC CBC CBC CBC CTV CBC CBC CBC Globa
l CBC CBC CTV CBC CTV CBC CBC CBC CBC CTV
AMA 1,234,000 826,000 740,000 710,000
686,000 652,000 636,000 598,000
590,000 572,000 553,000 546,000
495,000 452,000 432,000 430,000 424,000
400,000 392,000 373,000
PROGRAM Corner Gas (Monday, 8 p.m.) Little
Mosque (Tuesday, 830 p.m.) Just for Laughs
(Sunday, 8 p.m.) Rick Mercer Report (Tuesday, 8
p.m.) Little Mosque (Wednesday, 8 p.m.) Robson
Arms (Monday to Wednesday, 830 p.m.) The Tudors
(Tuesday, 9 p.m.) The Border (Monday, 9 p.m.) Air
Farce Live (Friday, 8 p.m.) The Guard (Tuesday,
10 p.m.) This Hour Has 22 Minutes (Tuesday, 830
p.m.) Rick Mercer Report (Friday, 830
p.m.) Corner Gas (Tuesday, 830 p.m.) Sophie
(Wednesday, 830 p.m.) Degrassi Next Generation
(Monday, 730 p.m.) Halifax Comedy Fest (Monday,
830) Winnipeg Comedy Fest (Monday, 8 p.m.)
Halifax Comedy Fest (Tuesday, 9 p.m.) Heartland
(Sunday, 7 p.m.) Instant Star (Tuesday and
Sunday, 830 p.m.)
Note Prime time shows only, August 27, 2007 to
April 6, 2008.Source BBM Nielsen
31
CBC Televisions Reliance on Analogue Cable and
Off-Air Viewing Has Declined
3. The English-Language TV Market
Distribution of Viewing to CBC Television by
Viewing Environment Monday-Sunday, 24 Hours
DTH
Digital Cable
Analogue Cable
Off-Air
September to August
Source BBM Nielsen
32
The Francophone TV Market
4
33
The Francophone Digital Universe Now Accounts for
57.7 of All Viewing
4. The Francophone TV Market
Distribution of Viewing Among Francophones by
Viewing Environment Monday - Sunday, 24 Hours
DTH
37.6
57.7
Digital Cable
Analogue Cable
Off-Air
September to August
Source BBM (Quebec Only)
34
But Off-Air Viewers Still Watch More Than 20
Hours of TV Each Week
4. The Francophone TV Market
Weekly Per Capita Hours of Viewing to Television
by Environment FRANCOPHONES in QUEBEC September
2007 to August 2008
Source BBM
35
And They Have a Plethora of French and English
Services from Which to Choose
4. The Francophone TV Market
A LOOK AT FRAGMENTATION Share of Francophone TV
Viewing in Quebec All Day (24 Hours)
September 2007 to August 2008Source BBM
36
But Two Companies Control More Than Half of These
Services
4. The Francophone TV Market
Share of Francophone Viewing Television among
Ownership All Day, 24 Hours
English TV
Radio-Canada
6
Other French Cdn TV
14
14
Quebecor (Conv. Spec.)
29
25
Astral Media (fr.)
8
3
Télé-Québec
Remstar
August 27, 2007 to August 31, 2008Source BBM
Nielsen
37
All Conventional Networks Have Lost Ground to
Specialty Services
4. The Francophone TV Market
Share of Francophone TV Viewing in Quebec, Prime
Time (7 p.m. to 11 p.m.)
Radio- Canada
Radio- Canada
TVA
TVA
TQS
TQS
Télé-Québec
Télé-Québec
Specialty/Cable
Specialty/Cable
English Stations
English Stations
Other
Other
September to AugustSource BBM PPM 2004-2005
TO 2007-2008
38
Radio-Canadas Reliance on Off-Air Viewers Has
Declined Significantly
4. The Francophone TV Market
Distribution of Télévision de Radio-Canada
Viewing by Environment Monday - Sunday, 24
Hours
DTH
30.7
51.9
Digital cable
Analogue Cable
Note Radio-Canada is less reliant on off-air
viewers than CBC TV
Off-Air
September to August
Source BBM Quebec Francophones
39
Radio-Canada Is the Leader When It Comesto
Canadian Programming
4. The Francophone TV Market
French-Languages TV Stations and Canadian
Programming Prime Time
September 2007 to August 2008Source BBM
40
But Is Not the Only One to Offer Series That Are
Appreciated by Francophones
4. The Francophone TV Market
Top 20 Drama/Comedy Series on French-Language
Television
Note Prime time shows only, August 27, 2007 to
April 6, 2008. Source BBM
41
Emerging Technologies in the Video World
5
42
New Ways of Accessing Video Content
5. Emerging Technologies in the Video World

• Technological advancements over the past ten
  years have given rise to a variety of new
  platforms for consumers to receive and view video
  programming, including video-on-demand (VOD),
  personal video recorders (PVRs), Internet
  streaming and Internet downloading.
• These new platforms and technologies have
  affected the video opportunities available to
  Canadians in three key ways.
• They significantly expanded where consumers can
  receive and watch video programming.
• All of these new platforms, with the exception of
  some forms of Internet streaming, can be
  characterized as on-demand services which free
  viewers from the rigidity of program schedules.
• Some new platforms provide video in a
  significantly different format from traditional
  television.

43
More Video Programming Available Over More
Distribution Platforms
5. Emerging Technologies in the Video World
Illustration of Multi-platform Growth Video

• 1995
• TV Distribution
• Over-the-air TV
• Analogue Cable
• Personalization
• VCR
• Specialty TV
• Pay TV

• 2008
• TV Distribution
• Over-the-air TV
• Analogue Cable
• Digital Cable
• DTH Satellite
• Wireless Cable (MDS)
• IPTV
• Internet
• Personalization
• VCR
• Specialty TV
• Pay TV
• DVD Player
• PPV
• PVR
• VOD
• Video Downloads

44
Ownership and Usage of Some of the New Video
Devices Is Low
5. Emerging Technologies in the Video World
Trends in the Penetration and Usage of Video
Technologies Among Canadian Adults
Source CBC/Radio-Canada's MTM, 2008
45
But Acceptance of These New On-Demand Tools Is
Higher Among Those Aged 18-34
5. Emerging Technologies in the Video World
Penetration and Usage of New Video
Technologies Among Anglophone and Francophone Age
Groups
Source CBC/Radio-Canada's MTM, 2008
46
CBC Radios Audience Performance
6
47
CBC Radio Weekly Usage Maintained Despite Overall
Decline in Radio Usage
6. CBC Radios Audience Performance
The lock-out of CMG employees affected 6 out of
the 8 weeks measured during S4 2005. Source
BBM
48
Audience Shares for CBC Radios Have Remained at
Historic Levels
6. CBC Radios Audience Performance
14.1
13.1
13.4
13.3
13.0
13.0
12.7
12.8
12.6
12.4
12.3
12.2
12.2
11.5
8.9
Base Anglophones who listened in CBC areas
The lock-out of CMG employees affected 6 out of
the 8 weeks measured during S4 2005. Source BBM
49
CBC Radio One Ranks in Top 3 in 9 Out of 10
Markets
6. CBC Radios Audience Performance
The Share of 12 Listening Captured
by Stations BBM S4 2008
Morning show runs from 6 a.m.-9 a.m. in
Newfoundland Labrador
50
Radio de Radio-Canadas Audience Performance
7
51
Radio de Radio-Canada Increased Usage Since 2001
7. Radio de Radio-Canadas Audience Performance
Labour dispute affected 3 ½ out of the 8
weeks measured The lock-out of CMG employees,
outside of Quebec and Moncton, affected 6 out of
the 8 weeks measured. Source BBM
52
And Audience Shares Have Nearly Doubled in the
Past Six Years
7. Radio de Radio-Canadas Audience Performance
20.0
19.8
19.4
16.5
16.7
16.3
15.6
15.7
15.3
15.2
14.7
13.7
12.4
11.1
10.8
Labour dispute affected 3 ½ out of the 8
weeks measured The lock-out of CMG employees,
outside of Quebec and Moncton, affected 6 out of
the 8 weeks measured. Base French Radio
Listening Among Francophones in SRC Areas
Source BBM
53
Weekday Morning Shares Demonstrate the Value of
Local Programming
7. Radio de Radio-Canadas Audience Performance
The Share of 12 Listening Captured by Individual
Stations BBM S4 2008
54
Emerging Technologies in theAudio World
8
55
New Ways of Accessing Audio Content
8. Emerging Technologies in the Audio world

• Numerous new ways of accessing audio content have
  become available in Canada.
• These new audio platforms provide consumers with
  increased choice in terms of where, how and when
  audio services can be received.
• The new audio platforms have met with varying
  degrees of acceptance by the public.

56
And They Present a Challenge to Traditional Radio
8. Emerging Technologies in the Audio world
Illustration of Multi-platform Growth Audio

• 1995
• Distribution
• Radio
• On-Demand
• Tapes
• CDs
• Portable
• Walkman

• 2008
• Distribution
• Radio
• Internet
• Satellite Radio
• On-Demand
• CDs
• Music Downloads
• Streaming Audio
• Podcasting
• Portable
• Walkman
• Digital Audio Player
• Mobile Phone

57
Use of Audio Technologies Among Anglophones and
Francophones Is Different
8. Emerging Technologies in the Audio world
Trends in the Penetration and Usage of Audio
Technologies Among Canadian Adults
Source CBC/Radio-Canada MTM, 2008
58
Acceptance of These New Technologies Is Higher
Among Younger Canadians
8. Emerging Technologies in the Audio world
Penetration and Usage of New Audio
Technologies Among Anglophone and Francophone Age
Groups
Source CBC/Radio-Canada MTM, 2008
59
Internet
9
60
Broadband Internet Has Entered the Mainstream
9. Internet
Home Internet Connection
ANGLOPHONES 18
FRANCOPHONES 18
Total 82
Total 73
Broadband and dial-up do not equal total home
Internet connections because some respondents
refused or dont know what type of Internet
connection they have Source MTM 2008
61
But Weekly Time Spent With the Internet Still
Lags TV and Radio
9. Internet
Weekly Per Capita Usage of Internet, Television
and Radio Hours/Week
ANGLOPHONES
FRANCOPHONES
Source MTM 2008 (Internet), NMR and PPM
2008-2009 (STD September to December) (TV), BBM
S4 2008 (Radio)
62
CBC.ca Among the Leaders in News and Information
9. Internet
Source comScore Media Metrix
(English Canada)
63
Radio-Canada.ca 2nd Most Popular in News and
Information
9. Internet
Source comScore Media Metrix
(French Canada)
64
What the Public Says
10
65
Our Measures of Value
10. What the Public Says

• Since 2001, the following indicators of
  performance have been measured
• Satisfaction I am satisfied with the
  programming on CBC/Radio-Canada
  Television/Radio.
• Essential It is essential that
  CBC/Radio-Canada Television/Radio is available
  to Canadians.
• Distinctiveness CBC/Radio-Canada
  Television/Radio has programs that arent on any
  other television/radio station.
• News Credibility You can trust news and
  information on CBC/Radio-Canada
  Television/Radio.
• Comprehensive You can count on
  CBC/Radio-Canada Television/Radio to give you
  complete news coverage.

66
In 2008, 9 in 10 Canadians Supported
CBC/Radio-Canada on All Indicators
10. What the Public Says
Corporate Performance Indicators for ALL
CBC/RADIO-CANADA TV/RADIO SERVICES Among all
Canadians 18
In terms of
Source QRS 2008
67
And Over 8 in 10 Canadians Tune to at Least One
of Our Services Each Month
10. What the Public Says
Past Month Usage of CBC/RADIO-CANADA
SERVICES Among all Canadians 18
Source QRS 2008
68
CBC/Radio-Canada Is a Vital Part of Canadian
Culture
10. What the Public Says
Corporate Image Ratings
CBC/Radio-Canada is a vital part of Canadian
culture
You can trust CBC/Radio-Canada
CBC/Radio-Canada is an organization that delivers
the highest quality services for the resources it
has available
CBC/Radio-Canada brings Canadians together as a
country
CBC/Radio-Canada is in touch with ordinary people
CBC/Radio-Canada is innovative, always looking
for new programs and ideas to deliver services
CBC/Radio-Canada pays attention to what the
publicthinks about its programs and services
CBC/Radio-Canada ensures that the funds available
to them are used to best reflect the needs and
interests of Canadians
Source Public Support Survey, TNS, April 2006
69
With Its Mandate Continuing to Be Important to
Canadians
10. What the Public Says
Mandate Importance Ratings
Providing in-depth News andInformation from a
Canadian perspective
Providing News and Information that people can
trust
Providing Television and Radio services which are
available to people living in all parts of Canada
Promoting our culture and identity
Serving the needs and interests of each region of
the country
Entertaining people
Providing programs of interest to many different
groups of people
Reflecting the multicultural nature of Canada
Helping people from all parts of Canada
understand each other better
Offering high quality, distinctive Canadian
programming
Source Public Support Survey, TNS, April 2006
70
And Canadians Believe CBC/Radio-Canada Is
Delivering on Its Mandate
10. What the Public Says
Corporate Performance Ratings
Providing in-depth News andInformation from a
Canadian perspective
Providing News and Information that people can
trust
Providing Television and Radio services which are
available to people living in all parts of Canada
Promoting our culture and identity
Reflecting the multicultural nature of Canada
Providing programs of interest to many different
groups of people
Entertaining people
Serving the needs and interests of each region of
the country
Helping people from all parts of Canada
understand each other better
Offering high quality, distinctive Canadian
programming
Source Public Support Survey, TNS, April 2006
71
CBC/Radio-Canada Represents Good Value for the
Funding It Receives
10. What the Public Says
Perceived Value For Money Of CBC/Radio-Canada
Funding
Source Public Support Survey, TNS, April 2006
72
But It Is Poorly Funded Compared to Other Public
Broadcasters
10. What the Public Says
Per Capita Public Funding for Public
Broadcasters 2007
Average 76
C per inhabitant
Data for 2007 fiscal year unless indicated
otherwise. Figures for Spain include an
estimate for the public broadcasters of the
autonomous regions. Source Nordicity Group
Ltd. Public funding data obtained from various
sources Exchange rates from Bank of Canada.
Population data from Population Reference
Bureau.