SATELLITE RADIO WILL SLOWLY PHASE OUT CANCON RULES Simon Tuck – Globe and Mail Canada's broadcasters have asked the federal broadcast regulator to put its review of conventional radio on hold for up to three years, arguing it would be pointless to assess the industry when it's under siege by new technology and facing a massive overhaul.
The industry, which was written off decades ago with the proliferation of television and many times since, is expected to respond to those challenges with fresh scrutiny of its content, business model and even regulations for such things as Canadian content, analysts and broadcasters say. Iain Grant, managing director of SeaBoard Group, a telecom consulting firm in Montreal, said the radio industry's overhaul will be so dramatic that many key players will have to reinvent themselves and their programming after decades of offering a popular mix of music, talk, news and sports. Canadian content requirements, he predicted, will be scrapped incrementally over the next decade or so.
"The principle is not sustainable in an Internet world."
Although the digital world took some time to hit the industry with full force, radio's towers, licences, barriers to entry and even regulations no longer mean what they once did.
New technology is offering new bundles of content in new ways, and usually does it without commercials.
The federal regulator, the Canadian Radio-television and Telecommunications Commission, helped fuel the need for change earlier this year when it awarded two new satellite radio licences that require dramatically less Canadian content than the 35 per cent that conventional radio must provide.
The proliferation of new technology, such as the wireless fidelity, or Wi-Fi, network that was awarded by the city of Philadelphia last week to EarthLink Inc., is creating more opportunity for music files to be downloaded on cellphones and other wireless devices. Podcasts -- do-it-yourself radio shows that are distributed on-line -- are fragmenting the market by offering oodles of new content on everything from bluegrass music to Thai cooking. Consumers, meanwhile, are flocking to new music-playing digital gadgets such as Apple Computer Inc.'s iPod.
There's no point in the CRTC conducting its review until those new developments have had a better chance to play themselves out, Glenn O'Farrell, chief executive officer of the Canadian Association of Broadcasters, wrote in a letter to the CRTC last month.
The review, which was expected to be launched this fall and take between six and nine months, should be delayed for between two and three years, the CAB said.
"At some point, things will slow down," Mr. O'Farrell said during an interview. "We think we're in right now a period of accelerated change that is going to continue for a little while."
Mr. Grant said he agrees it would be a good idea to delay the review.
"Technology is going to change radio the way it's changing telecom and will change cable," Mr. Grant said.
The commission has made no decision about the broadcast industry's request, but Diane Rhéaume, the CRTC's secretary-general, wrote back to Mr. O'Farrell last week to say the CRTC will respond "shortly."
Mr. O'Farrell and other industry players acknowledge that some of the new technologies have inherent advantages over conventional radio, and that those advantages are contributing to an absence of young listeners.
iPods, on the path to becoming a teen staple, have the capacity to store thousands of music tracks or even customized collections, without ever pausing for news or commercials.
Satellite radio, meanwhile, will offer dozens of new channels broadcast throughout North America that will have dramatically lower Canadian content restrictions than its conventional radio counterparts.
The two companies that were awarded licences to offer satellite radio in Canada -- Sirius Satellite Radio Inc. and Canadian Satellite Radio Inc. -- are expected to offer services in Canada by Christmas.
Last week, Philadelphia selected EarthLink to deploy a citywide wireless broadband network that will be the largest of its kind in the United States.
The Wi-Fi network, which is expected to be finished by the fourth quarter of 2006, was awarded a day after San Francisco announced that it had received 24 proposals for its own municipal Wi-Fi project.
Wi-Fi networks will make it easier to download podcasts and their music files, and stream audio over cellphones and other gadgets. On-line music files allow people to zip through the content without enduring the parts they don't want -- or commercials.
Not all radio players are concerned about the new challenges, or the question of Canadian content.
Rick Arnish, president of Jim Pattison Broadcast Group Ltd., which has 23 radio stations in British Columbia and Alberta, said satellite radio and other new competitors will mean further fragmentation of the market but that listeners will always want local content.
Elmer Hildebrand, CEO of Golden West Broadcasting Ltd. of Altona, Man., which includes a chain of 24 radio stations, said he doesn't mind playing Canadian music and other domestic content because that's what his listeners want.
"Everything we do is local." |