As Canada’s telecom regulator begins hearings this week into Sun News’ application to be a mandatory part of Canadians’ basic cable and satellite TV services, the broadcaster’s losses are growing deeper -- and the company is complaining the deck is stacked against it at the hearings.
The controversy-seeking, right-leaning current affairs channel recorded a loss of $18.5 million in the year ending in August of 2012, according to documents cited by the Globe and Mail earlier this month.
Sun News is reportedly asking for 18 cents per TV subscriber per month, or $2.16 per year. It's estimated the money would generate about $18 million in revenue annually from the fees -- just enough to offset Sun's losses.
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Controversy surrounding the Sun News Network began even before the network went on the air in April, 2011. The Globe and Mail reported in the summer of 2010 that CRTC chairman Konrad von Finckenstein was under pressure from the Prime Minister's Office to resign, in order to pave a smooth path for Sun News to be granted a licence by the regulator. Finckenstein denied the allegations.
With concerns swirling about the possibility of a PMO-driven political agenda at Sun News, the activist site Avaaz launched "Stop Fox News North," a campaign to pressure the CRTC to deny a licence to the news network. The network responded by citing Avaaz's U.S. roots and noting that left-wing billionaire George Soros has contributed to the group, in an apparent effort to discredit the petition as a "U.S. import."
Future Sun News personality Ezra Levant went further than most in his criticism of Avaaz and its links to George Soros (pictured above). Levant suggested in a column that Soros, who is Jewish, aided the Germans in the Holocaust as a teenager. After receiving a letter from Soros' lawyers threatening to sue, the Sun newspapers ran a retraction.
Sun News was on the air for only about six weeks when its first major controversy erupted. The CRTC received a record 6,676 complaints from viewers after host Krista Erickson aggressively challenged dancer Margie Gillis over the issue of whether artists should receive taxpayers' money in the form of grants. The Canadian Broadcasting Standards Council eventually ruled Erickson was within her rights to express her opinions during the interview.
Sun News has made the CBC's public funding a signature issue, repeatedly attacking the network for taking $1 billion per year in taxpayers' money while competing against private-sector broadcasters. But the CBC is fighting back. It put out a press release noting that Quebecor, Sun's parent company, enjoyed $500 million in subsidies over five years, and argued that -- unlike the CBC -- it is not publicly accountable to taxpayers.
Ezra Levant got himself in trouble again in December, 2011, when he responded to Chiquita Bananas' declaration it wanted to avoid oil from the oil sands. "Chinga tu madre," Levant said to Chiquita -- a phrase that translates as "f--k your mother." The Canadian Broadcasting Standards Council declared Levant's outburst a violation of ethics standards.
Canadian journalism reached an embarrassing nadir in the spring of 2012 when it emerged that a citizenship reaffirmation ceremony broadcast on Sun News had been partially staged. Six federal bureaucrats had posed as newly-sworn Canadians during the event that had been reportedly requested by Immigration Minister Jason Kenney. Kenney's office apologized to Sun News. Government officials later alleged Sun News was aware of the bureaucrats posing as new Canadians.
Sun News applied for a "mandatory carriage" licence in the fall of 2012 that would require cable and satellite operators to carry the network as part of their basic cable package. Though neither CBC News Network nor CTV News Channel currently enjoy mandatory carriage, they did when they first started out, as Sun News has pointed out.
Sun News reported in January, 2013, that it lost $17 million in 2012, due to weak revenue because the channel is only carried in 40 per cent of Canadian homes. Parent company Quebecor is saying the network will continue to lose money unless its request to the CRTC for mandatory carriage on basic cable is granted. Pictured: Quebecor CEO Pierre-Karl Peladeau
Sun News personality and well-known right-wing pundit Ezra Levant issued a formal, on-air apology after a September, 2012, segment in which he declared that the Roma were not a race, and were rather "a shiftless group of hobos" who "rob people blind" and whose "chief economy is theft and begging." The Toronto police reportedly even launched a hate-crimes investigation into the segment, at the request of a local Roma group.
In August 2013, the CRTC, Canada's telecom regulator, rejected Sun News' application for mandatory carriage. The network had asked the CRTC to make them a mandatory part of all basic cable services, arguing it would not survive financially without it. Though the CRTC rejected the Sun News application, it also launched a review of the rules surrounding cable news networks. Among the possible outcomes are a realignment of channels so all news channels are grouped together on the dial, and the possibility of a "must-carry" order for Sun News, which would mean that all TV service providers would have to at least offer the network. Pictured: CRTC Chair Jean-Pierre Blais
According to a report from iPolitics earlier this year, more than 90 per cent of people who submitted comments to the CRTC on Sun’s application as of January were opposed to it (107 out of 115).
A petition started on the activist website Avaaz.org, asking the CRTC to reject Sun’s mandatory carriage application, garnered the signatures of more than 25,000 Canadians, as of early March.
But Sun News shot back with its own petition, which the broadcaster said had gathered 53,000 signatures as of last month.
As well, “thousands more wrote personal letters to the CRTC describing why they love Sun News and how it reflects their values and view of Canada,” the network said in a submission to the telecom regulator last month.
According to some news reports, the network is complaining that it will be under-represented at the CRTC hearings that begin Tuesday in Gatineau, Quebec.
The CRTC allows only three speakers in favour of any given application, but allows for more speakers against an application, according to the Globe and Mail.
Among the three speakers to back Sun’s bid will be former Toronto city councillor Adam Giambrone, to many people’s surprise -- Giambrone is a well-known left-leaning voice in the city.
Neither of Sun’s most immediate competitors -- CBC News Channel and CTV News Network -- enjoy mandatory carriage. But Sun News execs often point out both networks were made mandatory for cable and satellite subscribers when they first started out.
"When Newsworld launched in ’87 and when CTV Newsnet launched in ’97 they both received mandatory distribution rights from the CRTC – preferential treatment they both enjoyed for 21 and 13 years respectively. It goes without saying this helped them get established in the marketplace," Sun News marketing director Dennis Matthews told The Huffington Post Canada last fall.
The CRTC begins on Tuesday what is expected to be eight days of hearings into mandatory carriage licences. No date has been set for a decision on Sun News’ application.
The news network is not the only channel vying for a mandatory spot on basic cable. There are nearly two dozen such applications before the CRTC, including one from existing multifaith channel Vision TV.
Some newly-launching channels are also applying to be part of basic cable, including Starlight: The Canadian Movie Channel, which would use fees from cable subscribers to produce original movies.