Canada’s telecommunications regulator, the Canadian Radio-television and Telecommunications Commission (CRTC), is contemplating easing Canadian content spending requirements for Corus Entertainment.
The company has cited labour unrest in the U.S. entertainment industry and high inflation as factors negatively impacting its financial performance.
Corus submitted an application last week, requesting “urgent” changes to some conditions for its English-language television stations and discretionary services, reports The Canadian Press.
Corus was founded by the Shaw family and is behind StackTV, as one of its online streaming services. The same streaming service that shows ads when you pay for the monthly fee.
In response, CRTC Secretary-General Marc Morin stated that the commission is inclined to grant the company’s request but will first hold a consultation on the proposals. “Given the urgency of the situation, the Commission determines that it is appropriate to give immediate consideration to Corus’ application on an exceptional basis,” Morin wrote.
In the application filed on October 11, Matt Thompson, Corus Vice-President and Associate General Counsel, asked the CRTC to lower the company’s obligation to spend 8.5% of revenues on programs of national interest for its English-language stations to 5%. Corus also requested an extension for the repayment deadline for under-expenditures of Canadian programming requirements.
The company reported a 22% drop in third-quarter profits this year compared to the same period in 2022. Over a five-year span, profits have plummeted by 43%. “These figures are indicative of a company whose financial capacity is severely constrained,” Thompson said.
Corus attributes its financial woes to multiple challenges, including recent strikes by the Writer’s Guild of America and the Screen Actors Guild in the U.S., as well as ongoing high inflation that has escalated programming costs and diminished advertising demand.
Drew McReynolds, an analyst at RBC Capital Markets, expects the CRTC to grant relief but noted the move would be “somewhat bittersweet at this juncture.” He stated that the relief would help Corus navigate an “exceptionally challenging operating environment” but also pointed out that this comes after years of structural changes that have significantly impacted Canadian broadcasting profitability.
Public feedback on the proposed relief is open until November 3, after which Corus will have five days to file its replies to the CRTC and other groups.
