Media Centre > News Releases > Archive > 1996 > March 25, 1996

Radio challenges accuracy of Music Industry report

OTTAWA, March 25, 1996 -- Canada's radio broadcasters today refuted music industry charges they aren't doing enough to support Canadian music and local talent.

The recent Report of the Task Force on the Future of the Canadian Music Industry gives an "inaccurate picture of radio's contribution to the success of the Canadian music industry", says the Canadian Association of Broadcasters (CAB) in a letter to Canadian Heritage Minister Sheila Copps. "We cannot let the 'findings' go unchallenged."

The report says little about the value of airplay in promoting Canadian music, stressed CAB President Michael McCabe, but its background documents describe airplay as the key to the Canadian music industry's success and survival. "Canadian radio stations have been stalwart supporters of Canadian music. We have discovered, promoted and played Canadian artists and made them stars. We have lived up to 30% Canadian content even though Canadian recordings make up only 12% of record sales."

McCabe agreed the use of Canadian music can be lower in intensely competitive morning and afternoon drive periods, when stations generally feature news, weather, sports, traffic, and a heavy advertising load. But he said stations play higher Canadian levels during mid-day which, according to recent BBM ratings, draws more listeners than either the morning or afternoon drives.

Obscured in the report, continued McCabe, is the music industry's phenomenal profits in contrast to radio's continuing losses. Statscan figures show a 700% increase in the profits of Canadian-controlled record companies from 1990-1994, and a sound recording industry profit of $140 million in 1993/94 alone.

By comparison, private radio lost $28 million in 1993/94, bringing accumulated losses over the last five years to a staggering $180 million.

Rejecting the notion radio has financial problems, the music task force suggests stations be allowed to close if they can't contribute cash to the music industry over and above today's $22 million in copyright payments.

Despite its rosy financial picture, the music industry now wants more money from government, radio and consumers. The demands:

Another $1 million a year in copyright fees through increased Canadian content

New neighbouring rights payments - on top of the $22 million a year radio pays today

A doubling to $10 million of an annual federal subsidy, including $500,000 for music lobby associations

$10 million a year in tax credits

A levy on blank cassettes which could generate $10 million annually

To the charge that radio doesn't live up to Canadian content rules, McCabe pointed out that in about 650 CRTC audits over the past four years only 35 problems have been found.

Concluded the CAB: The Music Task Force, in its two years of study and three background studies at public expense, "chose not to consult the CRTC record."

McCabe promised to set the record straight with a detailed analysis of broadcasters' ongoing efforts to support Canadian talent. CAB represents the vast majority of Canada's local serving, advertising-supported radio and television stations.

(Background material available on request.)

Please contact:

Susan Tolusso
Director, Communications
(613) 233-4035 ext. 331
(stolusso@cab-acr.ca)