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Canadian specialty, pay and pay-per-view television and video-on-demand services - a profitable industry

The Canadian Radio-television and Telecommunications Commission (CRTC) released the financial results for the Canadian specialty, pay, pay-per-view television and video-on-demand (VOD) services industry. During the last year, this industry experienced the highest growth in its revenues in the past five years. Total revenues rose by 12.4% in one year, to $2.5 billion in 2006, compared with $2.2 billion the previous year. Profits before interest and taxes (PBIT) totalled $572.7 million in 2006, and the PBIT margin reached 22.95%.

From 2005 to 2006, revenues from cable distribution services increased by 10.5%, reaching $1.1 billion in 2006, while those from direct-to-home satellite distribution services (DTH) grew by 13% to $520.8 million. The balance of the total revenues of $2.5 billion includes $48 million from local advertising, $834 million from national advertising and $35 million from other revenues.

The largest share of the total revenues, $2 billion, was earned by the 136 Canadian specialty television services operating in 2006, while the remaining $482 million was earned by pay, pay-per-view and VOD services. Of the amount of $2 billion, $1.8 billion came from the 49 analog services, $69.7 million from the 17 Category 1 digital services and $123.3 million from the 70 Category 2 digital services.

Spending on Canadian programming by specialty and pay television services reached $880.6 million in 2006. Of that amount, $149.3 million was spent on news programs, $211.6 million for other information programs, $221.2 million for sports programs, $162.3 million for drama programs, $41.1 million for musical and variety shows, and $61.1 million for general interest programs. Finally, these services spent nearly $300 million to acquire Canadian programs from independent producers.

Canadian specialty, pay, pay-per-view television and VOD services employed 5,264 people in 2006, and paid a total of $374.6 million in salaries.

The data contained in this report were drawn from the annual reports of specialty, pay, pay-per-view television and VOD services. The Commission is also releasing a report that presents the individual data for these services.

The Commission recently released the financial results for conventional television and will soon publish those for the radio industry, followed by the broadcast distribution industry. These annual reports allow interested parties to stay informed about the state of the Canadian broadcasting industry.

 [May 3, 2007]


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