HDTV costs shunned by advertisers

Consumers aren’t the only ones who are baulking at the prices involved with high definition technology.

In Canada, advertisers aren’t willing to pay the roughly 25% higher fees to have their ads run on HDTV. Since the advertisers aren’t footing the bill for the new technology, broadcasters are paying.

The CBC president, Robert Rabinovich, was painting a bleak future for the HD industry in his opening address at the two week Canadian Radio-television and Telecommunications Commission (CRTC) hearing into the state of Canada’s television sector.

Rabinovich suggested that the problem had to do with consumers’ migration to the internet. Advertisers tend to follow consumers. He suggested the answer could lie in opening the door for broadcasters to charge cable and satellite companies for carrying their signal. Currently, conventional broadcasters do not receive any compensation. All their revenue comes from the advertising dollars, which are not coming in.

Broadcasters are pushing the new fees, but cable and satellite providers, not surprisingly, are opposing the fees. The CRTC has said that more money must go in to developing Canadian content and productions for the fees to even be considered. The CBC supports that idea.

Broadcasters also want to move away from the allotted 12 minutes of ads (including product placement) that CRTC rules currently allows to a system more inline with American broadcasting (which seems at times to be running programs in-between ads instead of the other way around).