As many as 40 local television outlets and 200 Canadian radio stations could be forced to close in the next three years as the financial pressures faced by media companies intensify under the COVID-19 pandemic, suggests a new study from an industry advocacy group.
The Canadian Association of Broadcasters issued a report on Wednesday warning of potential closures and widespread job cuts as private TV and radio broadcasters face a cumulative projected revenue shortfall of up to $1.06 billion by the end of 2022.
Most vulnerable are the country’s AM radio stations, the report said, as well as other independent private radio and TV operations in smaller markets across the country.
The study, titled “The Crisis in Canadian Media and the Future of Local Broadcasting,” was commissioned by the CAB, which represents the majority of private broadcasters in Canada, and conducted through Winnipeg-based independent media economics consultancy Communications Management Inc.
The CAB says it’s concerned about the fallout from a substantial erosion in local advertising revenues over recent months.
Radio stations may be hardest hit in the short term, the report suggests, partly due to many advertisers pulling back on their spending in the pandemic and hastening a decline in the media industry’s revenues.
Private radio ad revenues are expected to be $383 million below last year, it said.
The report’s projections suggest that without further government support those declines could mean as many as 50 private local radio stations go out of business over the next four to six months.
Another 150 radio stations could topple in the 18 months that follow, it said, leading to as many as 2,000 job losses.
TV stations could risk a similar fate with roughly 40 of Canada’s 94 private TV broadcasters in danger of closing within one to three years, the research predicts.
In an email statement to Global News, Minister of Canadian Heritage Steven Guilbeault said the government recognizes “the essential role” media outlets have been playing to keep Canadians informed amid the pandemic.
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“That is why we acted and decided to provide independent news and community radio broadcasters with a $25 million emergency funding as part of our sector-wide Canadian Heritage COVID-19 emergency response,” the statement read. “Additional funds were also made available for organizations who do not usually benefit from our existing programs, like independent broadcasters and producers of content in a language other than English or French.”
The statement also noted the government is working on “modernizing” the Broadcasting Act and will share more information on that process soon.
Newly-elected Conservative leader Erin O’Toole said Wednesday that he would end the subsidy to CBC’s English television and online properties in an attempt to level the playing field with private broadcasters.
“I’ve said it’s time to reform and modernize and that means taking the state-subsidy out of certain areas of the media in CBC, English television namely and digital,” O’Toole said during an interview on CKNW. “I think that will help broadcasters, that will help the private media landscape and I’m willing to work with any sectors that have been acutely impacted by COVID.”
The CAB is calling on the Canadian Radio-television and Telecommunications Commission to take swift action by establishing a “more fair and sustainable future” for local media.
Last month, the organization sent an emergency application to the CRTC requesting permission for broadcasters to be relieved of certain terms of their agreements, such as spending requirements on Canadian programming, for the broadcast year that ends Aug. 31.
Lenore Gibson, chair of the CAB, said broadcasters have “done their utmost to cut expenses” in areas such as administration, and “the last thing that they want to do is cut into programming costs, but that’s the only area that’s left now.”
The CAB is urging the federal government to provide emergency regulatory relief as well as greater “targeted support” for the industry starting this fall.
Without greater financial measures in place, the CAB says the effects could leave many communities with only national and international media organizations to provide them with most of their news, effectively eliminating most community coverage of local politics, health and education in some regions of the country.
With files from Global News
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