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Rogers gains licence for all-news channel
http://www.globeinvestor.com/servlet/story/RTGAM.20081210.wtvnews11/GIStory/
GAYLE MACDONALD
WEDNESDAY, DECEMBER 10, 2008
Rogers Communications Inc. is getting into the 24-hour cable news business by launching a specialty channel, CITY News Toronto, that will go head-to-head with CTVglobemedia Inc.'s all-news CP24.
Rogers applied last April to the Canadian Radio-television and Telecommunications Commission for the broadcasting licence to operate a new English-language regional Category 2 specialty channel.
In its decision handed down Wednesday, the CRTC said the channel's programming would consist of local news, traffic, weather, business, sports and entertainment information for the city and commuting areas.
Rogers faced opposition from CTVglobemedia, whose Toronto cable channel CP24 plays around-the-clock news, traffic and weather updates. The private broadcaster had argued that the new channel would be a direct competitor.
On Wednesday, the regulatory watchdog ruled the new channel would focus on slightly different markets.
“CITY News Toronto would provide a niche news service targeted to Greater Toronto. In contrast, CP24's mandate is and has always been to serve the region of Southern Ontario,†the regulator said.
Rogers' application was also opposed by Pelmorex Inc., owner of the Weather Network, which said the new channel will infringe on its territory by running extensive weather updates. The CRTC said the new channel's programming “would be much broader in focus than that provided by the Weather Network.â€
Normally, the biggest challenge for any new channel getting on air is securing carriage on cable and satellite services. However, since parent CITY-TV is also owned by Rogers, it will face no issue getting carriage with the biggest cable operator in its market. It will, however, still have to negotiate a deal with the Bell ExpressVu satellite service to be carried.
Recently, the commission has expressed concern about the decline in local news production in Canada. It decided that CITY News will enhance the diversity of local news production in Greater Toronto. CTVglobemedia had also expressed concern that because Rogers is the dominant cable distributor in Southern Ontario, CITY News would receive carriage and priority channel placement, making it more widely distributed than CP24.
Rogers argued that – unlike CITY News – the Weather Network and CP24 both enjoy mandatory carriage, low channel placement and high brand awareness, and are authorized to collect a basic wholesale rate.
In a recent restructuring of the rules for the cable television sector this fall, the regulator removed the rules preventing new competition from entering the news market, making it possible for new entrants to come into the market.
In Ontario, CITY News will compete with other news channels such as CTV Newsnet, CBC Newsworld and CP24.
The decision comes as the landscape in cable news is already shifting in Canada. CBC executives told staff last week that market studies indicate consumer awareness of the public broadcaster's cable news channel, Newsworld, indicates the channel is lagging and needs to be revamped.
CBC is planning to overhaul the look of Newsworld in the fall of 2009. In describing the new strategy, CBC executives likened the proposed model to CP24, which keeps weather and news updates on-screen throughout the day.
Under CRTC rules, the new Rogers channel must be launched within three years of this decision, but the company will likely have it operating in 2009.
With files from reporter Grant Robertson
And CTVgm quickly responds by yanking CityNews at 6 and 11 off of CP24.