Hockey Night in Canada, which celebrates its 60th anniversary this year, is by far the network's most watched show. When the lockout-truncated 2013 season got underway last January, audience numbers reached record peaks of more than three million viewers. Playoff audiences have topped five million.
NHL hockey is also the network's biggest money-spinner, bringing in an annual haul of about $100 million, roughly a third of total CBC advertising revenue.
Many other public broadcasters carry professional sports. The BBC, for example, spends just under one-tenth of its public subsidy on sports rights. It justifies the expense by arguing that:
• Major sporting events can bring communities, and the nation, together;
• Minority and public service sports coverage brings communities of interest together and broadens cultural horizons, and;
• Sports broadcasts serve audiences that are otherwise under-served by the public broadcaster, such as young men, lower income and ethnic minority audiences.
Despite all of this, the CBC has no choice but to abandon HNC. Here's why.
Like the BBC, in a normal (non-Olympic) year CBC/Radio-Canada spends about one-tenth of its total revenue on sports, about $150 million. Most of this goes to NHL hockey and the long-running Hockey Night in Canada. The exact amount CBC pays to the NHL for broadcast rights is a closely-guarded secret, but insiders estimate it at $100 million. Add to that approximate production expenses of $25 million a year for a total of $125 million outlay for HNC. And according to Canadian Media Research Inc.'s Barry Kiefl, a former CBC research director, at least another $20 million should be added to account for the cost of selling the advertising.
So: revenue = $100 million; expenses = an estimated $145 million. Hockey produces a substantial net loss.
Hockey accounts for up to 400 hours of CBC television programming (Canadian content!) during the October-May season. Considering the rationale for broadcasting pro sports as summarized by the BBC, it could be argued that 400 hours is not a disproportionate allocation of time. The CBC could well claim that this is what it takes to engage those young men, low-income earners and ethnic minorities it would otherwise fail to reach.
Note, however, that while the BBC is able to spread its sports coverage over two television channels (BBC 1 and 2) , its Radio 5 live news and sports outlet, and its online services, CBC's sports programming is confined to its one English-language television channel and CBC.ca. (Radio-Canada relinquished French-language NHL rights hockey to the private cable sports outlet RDS, in 2001.)
The result on CBC television is that NHL hockey alone takes up a whopping 40 per cent of the prime time schedule between October and May. It's hard to see this as anything other than a serious programming imbalance.
And of course, there are other programming genres that could effectively engage low income and ethnic minority audiences -- though perhaps not young men. The BBC and other public broadcasters have addressed this issue not simply with sports, but with drama (Eastenders) and other program genres (Top Gear) that appeals to and reflects the lives of those demographics.
If CBC were to relinquish its NHL hockey rights to a private network, say, CTV, there is no reason why Canadians everywhere should not be able to continue to enjoy the sport on television. The various subscription sports specialty channels already broadcast three times as many NHL games as CBC (mostly American-vs.-American teams). The conventional terrestrial free-to-air private networks, which are also on basic cable, are technically capable of handling these productions.
One potential problem is that the commercial networks do not have the ubiquity of coverage, especially in the north, that CBC has attained and is mandated to provide. This is an issue that could be addressed through a CRTC regulation insisting that where private broadcasters of important sporting events cannot reach a specific audience, the CBC be given broadcast rights in that geographic area. There is ample precedent for this kind of co-operative arrangement throughout the history of broadcasting in Canada.
To protect Canadian viewers from the siphoning of important sports events to expensive subscription-only specialty channels (where producers glean revenue from both advertisements and subscription fees), the CRTC would once again have to intervene. Once again, however, there is ample precedent for this.
In the U.K., broadcast regulations stipulate that "listed" events deemed to be of national interest -- the FA World Cup, Wimbledon, Olympics, the Grand National and others -- must be offered to the BBC and/or must be made available without subscription fee to all Britons. These are called by the BBC "events of national resonance that bring the nation together."
Another grouping of sports events for which the BBC regularly purchases broadcast rights includes such spectacles as the British swimming championships, European gymnastics, motorcycle grand prix, Ascot, and the world darts championship. These are deemed to justify their cost by "driving audience value," and in some cases are of little interest to commercial, terrestrial free-to-air networks.
(The BBC, like all European Union public broadcasters, has in recent years been required to justify its expenditures on sports programming within the context of the wider broadcasting market. That is, they must demonstrate that in bidding for broadcast rights, they are not unfairly competing with their commercial counterparts by, for example, bidding up prices or monopolizing key rights.)
In an ideal world, the CBC, like the BBC, would have the funding and the additional radio, television and online outlets to enable it to continue to broadcast professional sport, including the Olympic Games (these days only technically "amateur" in nature). Given the real-world constraints under which the public broadcaster currently operates, however, a choice has to be made between carrying pro sport -- which can only be paid for with advertising revenue -- and having an advertising-free CBC.
In my view, the CBC simply cannot survive so long as it continues to rely on commercial sponsorship, and thereby makes itself essentially indistinguishable from its commercial competitors -- indistinguishable, and therefore irrelevant and unnecessary.
And so, NHL hockey has to go.
If it is true that by carrying NHL hockey the CBC is "bringing communities, and the nation, together," it will be unfortunate if the corporation has to abandon this opportunity in order to serve the greater purpose of becoming a true public broadcaster, one whose first priority is to serve citizens rather than advertisers.
But there's a silver lining. If and when private, commercial networks take on NHL hockey exclusively -- and if they are forced to provide key "listed" games via free-to-air and basic cable outlets -- they will be fulfilling a part of their obligations under the Broadcast Act that they have been neglecting for decades. That is, the obligation to provide genuine public service to the nation. In their current de facto role as re-broadcasters of American programming to Canadian audiences, with Canadian commercials inserted, they serve no such purpose.
