Thursday, November 03, 2011

Sun News Revenues Drop 86%

People can talk about long term plans, growing pains, "insert excuse here", but it's safe to say that SunTV/Sun News isn't exactly ELECTRIFYING the airwaves:
Sun News, which has been on the air for about six months, was also a drag on earnings. While specialty channels make money on a mix of advertising revenues and fees from cable and satellite subscribers, TVA chose to forgo subscriber revenue for Sun News until now. The channel was placed on a free, over-the-air TV signal, replacing the money-losing Sun TV station in Toronto, Ottawa, Hamilton and London, Ont. The over-the-air station was also picked up free by some cable and satellite companies.

The combined revenues of Sun TV and Sun News have dropped 86 per cent since the news channel launched in April. The channel is now negotiating deals with subscriber TV services to increase revenues.

I'm sure there are negotiations for subscriber revenues, but that doesn't distract from the clear picture: advertiser revenue has dried up and dried up BAD. This fact offers a clue as to the TRUE ratings for Sun TV, as well as testament to potential squeamishness from would be advertisers. Again, you can spin it all day long, but this station barks like a DOG, shits like a DOG and digs a money pit like a DOG.

What does it mean? I depart from others in viewing these numbers as evidence of a channel which will eventually pack it in. See, I don't think there was ever a rational "demand" for another news channel, nor do I think there was some gap in previous manifestations that needed something to fill the void. In fact, two news channels, you could actually argue saturation in the Canadian market, there was no true economic impetus for another channel. This backdrop is informative, because Sun TV isn't about making money necessarily, it was borne and pushed out of ideological zeal, a partisan consideration really, part of concerted effort to push a particular political bent. I view the network as a propaganda arm and I expect the channel to soldier on as long as is humanely possible, no matter the abysmal figures. The goal will be to lessen losses, buried within a larger conglomerate that can absorb the poor economics. Normal fundamentals don't necessarily apply in the short term, I expect a stubborn commitment that will forever preach future success.

I still haven't watched the station, although I feel like I have, given all the second hand conversation I read. I don't expect the network to simply vanish any time soon, while these numbers are heartening in one sense, there is much commitment to keep the Conservative signal up and running, no matter. What is clear though, commitment aside, this network is a BIT player at the moment, and it deserves attention in line with it's narrow influence.


Tof KW said...

I'll admit ignorance in asking if Peladeau's company is publicly traded or not, and laziness for not bothering to look that up.

Asking because even if only a part is publicly traded (like Murdoch and News Corp) at some point you could get booted as CEO by your irresponsible business actions, even if you enjoy majority control. If Peladeau owns Quebecor 100%, then he can be as foolish as he wants with Sun News.

Steve V said...

Yes it is publicly traded, and you're right that at some point shareholders will hold them to account. I also suspect the "3-5 year" profitability statement is a way to appease shareholders in the short term.

JimBobby said...

Looks good on these right-wing rag merchants who like to put their faith in the invisible hand of the free market. I get a small town daily paper that was recently taken over by QMI. Every day, there's about a full page of free advertising for Sun media. Despite that, they can't seem to break even. Awwww. Poor widdle Ezra.

Rev.Paperboy said...

Part of the problem with Sun-tv is that like right wing hate radio, it kinda creates its own market as it gets adopted by more and more idiots as a defence mechanism to support their narrow world view. Like FOX and the Sun newspapers, its stock and trade is telling idiots, bigots and right wing psychos what they want to hear, facts be dammed. Thus reinforcing and further narrowing their yahoo, pig ignorant, blank and white view of the world. Ezra's ambition is to be Canada's Glen Beck, Rush Limbaugh or Sean Hannity (although I think Charles Adler has the Hannity job all sewn up)