In the United States, the FCC, the equivalent of our CRTC, has for all practical purposes forced cable and satellite distributors to pay local television stations for the right to distribute their signals, just like the specialty channels.
In Canada unfortunately, and in spite of the CRTC's desire to introduce such a practice, some of the large cable and satellite television distributors objected to this practice. A three-two judgment rendered several years ago by the Supreme Court of Canada determined that this practice was inapplicable, based on certain provisions of the Copyright Act in Canada.
In our opinion, it would have been more logical for the conventional television stations to obtain subscription revenues for their signals, which would have improved the financial situation of our whole industry.
One solution would be for the Government of Canada to make the necessary amendments to the Copyright Act to allow conventional television stations to obtain subscription revenues.
Given the financial difficulties facing conventional and local television stations, the CRTC made the best decision in the circumstances on June 15 when it announced the Independent Local News Fund, the ILNF, using the same financial resources available within the broadcasting system.
We approve and support this fund and thank the Commission for having established it, so that Canadians can continue, as they wish to, to benefit from very high quality local news.
However, this amount may turn out to be inadequate to satisfy all needs in the future. The Broadcasting Act obliges distributors to pay 5% of their revenue for the production of Canadian programming. We believe that this amount ought to be subject to increases by the CRTC if maintaining local news makes it necessary.
Finally, we would like to emphasize that it is absolutely vital for our four local television stations to maintain their affiliation with the three main French television networks: TVA, Radio-Canada and V.
Ninety-five per cent of our programs come from these three major networks. Seventy per cent of our revenues are from network advertising sales. Without network affiliation, it would be absolutely impossible to operate a local television station in the regions.
In a decision handed down in 2007 involving certain aspects of the regulatory framework for over-the-air television, the CRTC stated:
The Commission considers that independent broadcasters play an important role in providing local programming outside of major markets. In order to provide local programming of high quality, they need the financial strength that results from reasonable affiliation agreements and financial support.
After more than 50 years of experience in broadcasting, we ask the Government of Canada, through the Ministry of Canadian Heritage, to maintain and reinforce all the powers of the CRTC, and to do so in the interest of all Canadians, so that they can have access to high quality local news. We want to emphasize that that organization is the sole guardian of Canada's broadcasting system.
Finally, we deeply believe that local television should remain the primary source of news for Canadians.
We thank the Standing Committee on Canadian Heritage for its invitation to appear and its evident interest in the activities of our local stations, and we are ready to answer your questions.
Thank you.