Earnings down at Canadian stations

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OTTAWA -- Higher programming costs for U.S. primetime series helped cut earnings for Canadian over-the-air TV stations last year, the country's TV watchdog said Wednesday.

The Canadian Radio-television and Telecommunications Commission said that industry-wide earnings for domestic conventional TV stations fell to CAN$91 million ($77.7 million) in 2006, compared with year-earlier earnings of CAN$242.2 million.

And the increasing dependence Canadian broadcasters have on U.S. primetime hits to drive audience and ad revenue is in partly to blame.

The latest CRTC statistics on the Canadian TV industry reveal that the cost of foreign programming on Canada's private, over-the-air networks rose 12.2% in one year, from CAN$613.2 million in 2005 to CAN$688.3 million ($588 million) last year. Much of that money was spent at the annual Los Angeles Screenings, where top Canadian broadcasters like CTV, CanWest MediaWorks and Chum, annually dig deep to purchase the rights to new and returning U.S. network series.

Expenditures by domestic conventional broadcasters on Canadian programming, by contrast, rose a more modest 6.3% to CAN$623.7 million ($536 million) in 2006.

As usual, Canadian broadcasters showed a hearty appetite for U.S. dramas, led by such popular hits as the "CSI" franchise, "House" and "Grey's Anatomy."

In all, Canadian broadcasters spent CAN$478.6 million ($408.5 million) on foreign, mostly U.S., TV dramas last year, the CRTC reported, compared with CAN$70.9 million ($60.6 million) invested in homegrown dramas in 2006.

The Canadian market is rare among Western countries in seeing its domestic broadcasters devote far more to foreign, mostly U.S. dramas, than to homegrown one-hour dramas.

Canada's private networks also spent more last year on foreign-produced sports, game shows, human-interest and other programming than on indigenous productions in the same genres.

The exception last year, as in former years, according to the CRTC, was in news and current affairs programming. Here Canadian broadcasters invested heavily in homegrown newsgathering, with CAN$328.1 million ($280 million) being poured into locally produced news programming, and only a fraction of that going into foreign-produced news accounts.

In all, the CRTC revealed that programming expenditures -- including those for development, dubbing and sales and promotion -- totaled CAN$1.45 billion ($1.23 billion) in 2006, compared with CAN$1.32 billion a year earlier.

And while programming costs increased, revenue held steady, with local ad sales growing 3.4% to CAN$375.4 million ($320 million) and national sales remaining stable at $1.5 billion ($1.28 billion).
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