Local television remains the most effective way to reach a mass audience. It's where Canadians turn first for information about what is going on in their community, and it is the place where viewers expect to find the biggest shows, whether that's popular dramas, tent-pole events, or programs of national interest.
Local television is a megaphone for the discoverability of Canadian content on digital platforms. In that role, local television supports and promotes the digital ecosystem, which is why it is vitally important that it remain a viable platform.
But we must also be mindful of the business reality of local TV. With declining advertising dollars and no access to other sources of revenue, the business model for local TV is not sustainable. Local over-the-air television is the only form of regulated television that does not have any form of subscription revenue. As an advertising-only service, local television is simply no longer sustainable in its current form.
Some have argued that the growth of online news platforms is part of the solution. That is true, but the cost involved to gather and produce high-quality news remains the same regardless of the platform on which it is made available. Despite this, we still need to invest in these platforms, because it's what our viewers want, and local television newsgathering provides the backbone for us to do so.
However, the financial picture for local television has the potential to get worse in the near future.
First, in order to coordinate our spectrum policies with those of our neighbours south of the border, the government is repurposing the 600 megahertz spectrum band on which over-the-air television stations operate. While we are supportive of this initiative in general, it will cost Bell Media tens of millions of dollars, if not more, this after spending roughly $30 million five years ago for the digital conversion.
Second, the decision by the CRTC to remove the ability to request simultaneous substitutions during the Super Bowl will result in a multi-million dollar loss of advertising revenue for CTV. Even this large amount pales in comparison to the broader impact on the Canadian economy, including the impact on local advertisers, who will lose an important vehicle to promote their products and services.
The impact is not just economic. Canadian consumers will be exposed to U.S. pharmaceutical drug advertisements that do not meet Health Canada standards, as well as advertisements for financial services that may be contrary to Canada's public policy objectives. Canadian tourism will lose the opportunity to promote our country to Canadians, and we'll lose the ability to promote Canadian programs, something that we have done with great success to date.
None of this is in anyone's interest.