ARCHIVED - Decision CRTC 2000-468

LCN Affaires — a new specialty service

On 24 November 2000, the Commission made a decision to issue a licence for a new national French-language Category 1 specialty television service to be called "LCN Affaires". The Commission noted at that time that reasons, terms and conditions of the new licence would follow at a later date.

LCN Affaires will be devoted to business and personal finance. As noted in Public Notice CRTC 2000-171 of today's date, this service and 20 other new digital specialty services will be made available to subscribers by all distributors who offer programming to the public using digital technology and by some cable operators who serve smaller markets using analog technology. The licence, when issued, will expire 31 August 2007.

LCN Affaires will increase the diversity of the Canadian broadcasting system by offering a range of programming on business and personal finance, of which there is relatively little on French-language television. In awarding a licence to LCN Affaires, the Commission considered consumers’ growing interest in matters relating to the economy and finance. In Public Notice 2000-171, the Commission discusses the criteria for the approval of this and other applications for new specialty services.

LCN Affaires inc., a company to be incorporated, will be held primarily by Groupe TVA inc., (TVA) which will hold a 50.1% share in the company and will be responsible for its daily operations. Publications Transcontinental inc. (Publications Transcontinental) and BCE Media inc. (BCE) will be the service’s other partners and will hold voting interests in the company of 30% and 19.9% respectively.

Terms and conditions of licence common to all of the new Category 1 specialty services are set out in an appendix to Public Notice 2000-171. Conditions specific to this application can be found in the appendix to this decision.

Programming

Nature of service

LCN Affaires will offer a national Category 1 French-language specialty service devoted to the economy, the world of business and personal finance. The programming will be of interest to a target audience consisting of business people and all other persons wishing to learn how to better manage their money. The proposed programming categories for LCN Affaires are set out as a condition of licence found in the appendix to this decision.

The programming of LCN Affaires will have two primary components:

• the first component, offered from Monday to Friday, will consist of news and information about the stock market, analysis and reporting on finance and business; and

• the second component, offered on the weekend, will generally consist of more entertaining programming relating to money, including biographies, documentaries, mini-series and feature films.

With regard to the proposed broadcast of feature films, the Commission notes that in previous licences awarded to other French-language specialty services, it restricted the broadcast of feature films on these services due to the significant presence of this category of programming on existing conventional French-language television stations. Accordingly a condition of licence set out in the appendix limits the broadcast of feature films by LCN Affaires to the weekends (Saturday and Sunday).

Contributions to diversity

LCN Affaires will make a significant contribution to the diversity of programming currently available since there is no French-language specialty network that currently offers programming devoted to the world of business and personal finance. The Commission recognized this niche by authorizing an equivalent English-language service (ROBTv) in 1996.

Canadian content

The licensee made a commitment to broadcast a minimum of 85% Canadian content from 6 a.m. to midnight, and 85% from 6:00 p.m. to midnight, throughout the licence term. In addition to exceeding the minimum Canadian content required in the first year of operation, the programming offered from Monday to Friday by LCN Affaires will be entirely Canadian. The licensee also made a commitment to broadcast a minimum of 4,056 hours of original Canadian productions per year throughout the licence term.

Canadian programming expenditures

Beginning in the year following the first year of operation, the licensee will expend a yearly minimum of 52% of its gross advertising, infomercial and subscription revenues on Canadian programming. The licensee estimates that, in accordance with this formula, it will spend over $35 million over the licence term on Canadian programming. A formula for the calculation of the required amounts is set out in a condition of licence, found in the appendix to this decision.

Independent production

In view of the unique format of the proposed service, which is similar to that of an information service, the licensee indicated that LCN Affaires will produce the majority of its programming internally. As set out in Public Notice 2000-171, all Category 1 services will be subject to a standard condition of licence relating to the use of independent production.

Interactivity

The licensee intends to initially offer a website to complement the proposed service, until digital technology opens up new avenues. It expects that interactivity will gradually be incorporated into program development. The licensee also stressed that LCN Affaires will definitely be one of the first services to reap the benefits of interactivity.

Ownership and synergies

As previously noted, TVA will hold a majority interest (50.1 %) in LCN Affaires inc., a company to be incorporated. The voting interest of Publications Transcontinental and of BCE will be 30% and 19.9 % respectively. The licensee will be controlled by its Board of Directors.

TVA will be responsible for managing the company. Its responsibilities will include in particular:

• launch, and operation of the service;

• technical services;

• sale of advertising time;

• accounting activities and financial services;

• dealings with distributors.
  

LCN Affaires is based on a solid partnership with promising synergies. LCN Affaires will be able to count on the constant co-operation of LCN (Le Canal Nouvelles), a headline specialty service belonging to TVA. Moreover, Publications Transcontinental is the pioneer in French-language business press in Quebec. LCN Affaires will, in particular, benefit from the expertise provided by the team at Les Affaires, a financial weekly distributed in Quebec. The service will also be able to utilize the resources of Web-Fin, the specialized financial information Internet site of Netgraphe, of which TVA has an indirect interest of 27%.

Submission of documents

This authority will only be effective and the Commission will only issue the licence when the applicant has clearly demonstrated that it is a "qualified corporation" as defined in the Direction to the CRTC (Ineligibility of non-Canadians) and is eligible to hold a licence. Consequently, the applicant is required to file all relative incorporation documents (certificate and articles, by-laws, etc.), as well as the complete list of shareholders (including the number of shares each holds), directors and executives.

Rate

In its business plan, LCN Affaires proposed a monthly wholesale rate of $1.55, and a three-month free trial period.

Other matters

Service to the hearing-impaired

The licensee made a commitment to close caption at least of 45% of all programming on LCN Affaires during the first year of operations. This percentage will increase gradually, to a minimum of 90% of all programming in the seventh year of operation. The Commission expects the licensee to fulfil its commitments.

From the beginning of operation, the licensee will have a teletypewriter (TTY) device for the hearing impaired and will ensure that the telephone number is well advertised.

Service to the visually impaired

The licensee indicated that it will have the necessary equipment to provide descriptive video service. The Commission encourages the licensee to provide audio description of visual information wherever possible, and to provide described video programming as outlined in Public Notice 2000-171.

Employment equity

The Commission notes that this licensee will be subject to the Employment Equity Act that came into effect on 24 October 1996 and will therefore file reports concerning employment equity with Human Resources Development Canada.

Conclusion

The Commission is satisfied that LCN Affaires will provide a range of unique and attractive programming that will contribute to the diversity of the Canadian broadcasting system. LCN Affaires will also serve as an educational tool about finance and economic development for all Francophones. The Commission also believes that the expertise and resources available to each of the partners will ensure the success of LCN Affaires.

Secretary General

This decision is to be appended to the licence. It is available in alternative format upon request, and may also be examined at the following Internet site: www.crtc.gc.ca

Appendix to Decision CRTC 2000-468

The licence for the national French-language programming undertaking (specialty television service) known as LCN Affaires will be subject to the following conditions, as well as those set out both in Public Notice CRTC 2000-171, and in the licence to be issued.

Nature of service

News

Analysis and interpretation

Reporting and actualities

General entertainment and human interest

Informal education/Recreation and leisure

Specials, mini-series or made-for-TV feature films

Exhibition of Canadian programs

Expenditures on Canadian programs

2. In each broadcast year following the first year of operation, excluding the final year, the licensee may expend an amount on Canadian programs of up to ten percent (10%) less than the minimum required expenditure for that year set out in or calculated in accordance with this conditions; in such case, the licensee shall expend in the next year of the licence term, in addition to the minimum required expenditure for that year, the full amount of the previous year’s underexpenditure;

• In each broadcast year following the first year of operation, where the licensee expends an amount on Canadian programs that is greater than the minimum required expenditure for that year set out in or calculated in accordance with this condition, the licensee may deduct:

2. Notwithstanding paragraphs b) and c) above, during the licence term, the licensee shall expend on Canadian programs, at a minimum, the total of the minimum required expenditures set out in or calculated in accordance with the licensee’s condition of licence.

Definition

The term broadcast day shall have the same meaning as that set out in the Television Broadcast Regulations, 1987.