ARCHIVED -  Decision CRTC 95-98

Decision

Ottawa, 15 March 1995

Decision CRTC 95-98

CFCF Inc. (Quatre-Saisons)

Montréal and Rimouski, Quebec - 940681000 - 940679400

Licence renewals

Following a Public Hearing in Montréal beginning on 11 October 1994, the Commission renews the licences issued to CFCF Inc. for the Quatre-Saisons television network and for the television programming undertaking consisting of CFJP-TV Montréal and its transmitter CJPC-TV Rimouski from 1 September 1995 to 31 August 1997, subject to the conditions in effect under the current licences, as well as to those conditions specified in this decision and in the licences to be issued.

This short-term renewal reflects the Commission's serious concerns regarding the licensee's non-compliance with subsection 4(6) of the Television Broadcasting Regulations, 1987 (the regulations) relating to the broadcast of Canadian programming, and will enable the Commission to conduct an early review of the manner in which the licensee addresses the various concerns, expectations and requirements set out in this decision. It will also enable the Commission to consider the renewal of these licences at the same time as that of most French-language television networks and stations in the province of Quebec.

The stations authorized to be affiliated with the Quatre-Saisons television network will be specified in a schedule appended to the licence. The applicant is reminded that, in line with Public Notice CRTC 1985-252 dated 20 November 1985, any addition or deletion of affiliates requires the prior written approval of the Commission.

Background

At the time these licences were last renewed (Decision CRTC 92-549), Quatre-Saisons advised the Commission that, because of its precarious financial situation, it was [TRANSLATION] "unable to make formal commitments other than to comply with the rules on Canadian content". Dissatisfied with the licensee's all but total refusal to make specific commitments for the new licence term, the Commission decided to renew the licences for three years only. In its decision, the Commission indicated that, at the next licence renewal, it would examine the future program orientation chosen by Quatre-Saisons. It also stated expectations regarding Canadian programming for children and captioning.

On 2 November 1993, replying to a letter from the Commission, Quatre-Saisons acknowledged its non-compliance in the 1992-1993 broadcast year with subsection 4(6) of the regulations, which states that "a licensee shall devote not less than 60 per cent of the broadcast year and of any six month period specified in a condition of licence to the broadcasting of Canadian programs". This incidence of non-compliance involved the six stations affiliated with the Quatre-Saisons television network. As its undertaking respecting the broadcast of Canadian programs was the only commitment given by the licensee for the current licence term, the Commission advised the licensee, in Notice of Public Hearing CRTC 1994-13 dated 12 August 1994, that it would be expected to show cause at the hearing why the Commission should not issue a mandatory order requiring it to comply with this provision of the regulations.

The Hearing

At the hearing the Commission asked the licensee to explain why, in the 1992-1993 broadcast year, it had broadcast only 59.32% Canadian programs instead of the regulatory minimum of 60%; this represents a shortfall over the year of about 30 hours of programming. The licensee stated that it had always intended to comply with this regulatory requirement, but its computer system failed to keep an accurate record of the Canadian programming hours broadcast during the summer, when programming hours are reduced.

The licensee added that it subsequently implemented strict measures to ensure that its system of information, management and planning for Canadian content would enable it to meet the levels required by regulation at all times. It stated that it even exceeded the regulatory requirement for Canadian content over the next two years. The licensee also indicated that, during the evening broadcast period, it broadcast over 60% Canadian programming where the regulations require only 50%, and that this is evidence of its [TRANSLATION] "firm commitment to Canadian content", and that its Promise of Performance and commitments set out in the current application are indicative of its future intention in this regard.

At the request of the Commission at the hearing, the licensee stated that it would accept a condition of licence requiring it to maintain the minimum level of Canadian content required by regulation, but on a semi-annual basis. Accordingly, it is a condition of licence for CFJP-TV that the licensee devote not less than 60% of each six-month broadcast period to the broadcast of Canadian programs, that is, from 1 September to the last day of
February and from 1 March to 31 August.

Having considered the explanations provided by the licensee, the measures taken by it following its non-compliance, and its Canadian content commitments for the new licence term, the Commission is satisfied that the licensee demonstrated a firm intention at the hearing to comply with subsection 4(6) of the regulations in the future, and that it showed cause, in this case, why the Commission should not issue a mandatory order. However, the Commission reminds the licensee that the Broadcasting Act (the Act) places fundamental importance on Canadian programming and on the role that broadcasters must play in the Canadian broadcasting system. The Commission is gravely concerned by the licensee's failure to comply with subsection 4(6) of the regulations; it expects the licensee, in future, to carry out its responsibilities under the Act and to comply fully with the regulations by broadcasting the prescribed minimum percentage levels of quality Canadian programming. The Commission will monitor closely the licensee's performance in this respect, and places the licensee on notice that if it determines the licensee to have again failed to comply with subsection 4(6) of the regulations, it may take all enforcement measures available to it under the Act.

At the hearing, Quatre-Saisons acknowledged that it was its mandate to make a special contribution by operating a television undertaking that offers a complementary and distinctive service. It added that it intends to continue [TRANSLATION] "to offer programming that complements that of the other three networks with special emphasis on three components, namely, information, movies and sports". At the last renewal of these licences, the Commission expressed concern regarding the level of Canadian content that the licensee would achieve within its movie programming component. In the 1993-1994 broadcast year the licensee broadcast just over 40 Canadian films, but it claims to have broadcast the equivalent of one feature-length film every day during peak viewing hours. In view of the licensee's difficulty in meeting the regulatory minimum of 60% Canadian content, and to ensure that it can fulfil this requirement, the Commission encourages it to broadcast more Canadian films, including during off-peak hours. The Commission believes that this practice of offering a broader outlet for the distribution of French-language Canadian films and English-language Canadian productions dubbed in French, would further the interests of the Canadian broadcasting system.

A second concern raised by the Commission at the hearing was the licensee's non-compliance with subsection 11(1) of the regulations which provides that "a licensee shall not broadcast more than 12 minutes of advertising material during each clock hour in a broadcast day". The Commission analysed the content of the programs broadcast by CFJP-TV Montréal from 27 March to 2 April 1994. The analysis revealed that between 5:00 p.m. and 6:00 p.m. on 2 April, the licensee exceeded the prescribed time limit for advertising material. Specifically, the Commission determined that some segments of the program "Passion Plein Air" constituted advertising. When added to the advertising messages broadcast by the licensee, these segments increased the time devoted to advertising beyond the prescribed limit.

At the hearing the licensee explained that this problem was the result of a misinterpretation of what constitutes program content and what constitutes advertising content. It added that, to prevent such problems in future, it now provides all producers with a copy of all CRTC directives and regulations relating to advertising, and ensures that, through discussions between its production, legal services and programming staff and independent producers, there is a clear and common understanding of these requirements. Quatre-Saisons also struck a committee to screen programs for content before broadcast. The Commission reminds the licensee that it is essential that it maintain total control over its programming as required under the Act and regulations, particularly programming supplied by independent producers.

At the last licence renewal hearing for Quatre-Saisons in March 1992, the licensee indicated that its financial situation had created some doubt as to its survival. The licensee has had an average annual pre-tax deficit of $23 million since it went on the air in 1986. The licensee added, however, that it was developing a financial recovery plan. The Commission is pleased to note that the licensee's recovery plan has produced positive results, as its deficit has been decreasing year-by-year. The Commission congratulates the licensee for the progress made to date and encourages it to continue in the same direction.

The licensee described the difficult economic environment in which the television industry currently operates. At the hearing, it stated that the advertising market has been shrinking because of the merger or closure of large companies, the declining share of advertising and the shift to promotional campaigns as a part of the overall marketing budgets of private companies, and uncertainty regarding consumer trends. The licensee indicated that, in view of these factors, it has decided to be cautious in its advertising revenue forecasts, and has revised its forecasts downward, accordingly, from those it presented in its 1991 renewal application.

The Commission has reviewed the new advertising revenue forecasts for CFJP-TV. Taking into account the past performance of conventional television in Montréal and the economic indicators available, the Commission considers that Quatre-Saisons' projections may be overly pessimistic. At the hearing the Commission asked the licensee about its programming plans in the event that its revenues were to exceed its financial forecasts. The licensee indicated that its first concern would be the financial viability of the undertaking. It added: [TRANSLATION] "Our development as a network depends on our programming and the relevance of the programming that we offer to our viewers, and there can be no doubt that, where financial resources permit, further improvements in that area can only benefit the system as well as the Quatre-Saisons network as a part of the system". Should financial resources permit, the licensee stated that programming for children between the ages of 2 and 11 is a category where improvements are particularly essential, and that it would also, [TRANSLATION] "in the spirit of complementarity and distinctiveness", offer more drama programming.

Commitments and Expectations for New Licence Term

The Commission notes the commitment made by the licensee at the hearing to comply with the regulatory requirements for Canadian content and the condition of its licence relating thereto.

The Commission further notes the undertaking by Quatre-Saisons to broadcast 93 hours a week of programming, including 12 hours of local news as follows: 6 hours a week during daytime hours (6:00 a.m. to 6:00 p.m.) and 6 hours a week during peak viewing hours (6:00 p.m. to midnight).

With regard to program development, Quatre-Saisons will allocate $100,000 a year to the development of drama, variety and children's programming. The licensee committed to broadcast two, original, 30-minute information productions per week directed to young viewers between the ages of 8 and 11, and to broadcast one daily program aimed at children between the ages of 2 and 11. In the preamble to the 1992 decisions renewing the licences of most private French-language television stations and networks (Public Notice CRTC 1992-53), the Commission indicated that it would expect "the private television networks to broadcast, on a regular basis, new Canadian children's programming [for the 2-11 age group] that reflects the concerns and aspirations of young Québécois." Consistent with its position in 1992, the Commission expects the above-noted 30-minute program for children in the 2-11 age group to be Canadian.

The licensee also gave an undertaking to invest approximately $80,000 per year to upgrade its service to the deaf and hard of hearing and to expand its captioned programming from 887 hours in the first year to 912 hours in the second year. The Commission acknowledges the licensee's efforts with respect to captioning during the current licence term, a performance for which it was also commended in 1993 by the Regroupment québécois pour le sous-titrage Inc.

Other Conditions of Licence

It is a condition of licence that the applicant adhere to the guidelines on gender portrayal set out in the Canadian Association of Broadcasters' (CAB) "Sex-Role Portrayal Code for Television and Radio Programming", as amended from time to time and accepted by the Commission. Quatre-Saisons is not a member of the Canadian Broadcast Standards Council. Should the licensee become a member of the Council during the new licence term, the application of the foregoing condition of licence will be suspended as long as it remains a member in good standing of the Council.

It is also a condition of licence that the licensee adhere to the provisions of the CAB's "Broadcast Code for Advertising to Children", as amended from time to time and accepted by the Commission.

It is a condition of licence that the licensee adhere to the guidelines on the depiction of violence in television programming set out in the CAB's "Voluntary Code Regarding Violence in Television Programming", as amended from time to time and accepted by the Commission. Should the licensee become a member of the Canadian Broadcast Standards Council during the new licence term, the application of the foregoing condition of licence will be suspended as long as it remains a member in good standing of the Council.

In Public Notice CRTC 1992-59 dated 1 September 1992 and entitled "Implementation of an "Employment Equity Policy", the Commission announced that the employment equity practices of broadcasters would be subject to examination by the Commission. The Commission will address these matters at the next renewal of this licence in 1997.

Interventions

The Commission received 22 interventions from organizations and associations in support of these renewal applications.

Allan J. Darling
Secretary General