The fall in television advertising income has accelerated for a year. VAT and Noovo suffer the upper jail. The two private general channels display each of the losses of more than 50 million for 2023-2024.
This is revealed by figures made public last month by the CRTC for the financial year which ended on August 31, 2024. During the latter, TVA reported a loss, before interest and taxes, of 59.7 million. In 2022-2023, the most listened to Quebec TV network declared record losses of 65.1 million.
If TVA has managed to diminish its shortfall in the last year, it is thanks to a reduction in its expenses. Recall that the company, property of Quebecor, announced in 2023 important compressions, which are only partially reflected in the figures for the last financial year.
The chain, which draws a good part of its advertising income, continues to be sealed by the exodus of advertisers to foreign digital platforms. Even in 2023-2024, VAT revenues reached a new floor. They went below 160 million. It is even less than the threshold that had been reached during the first year of the pandemic, when part of the economy was stopped.
“Our company has made several difficult gestures to reduce its operational costs, including the abolition of more than 680 jobs in less than two years. It’s not enough. Emergency aid is necessary at various levels, otherwise the situation will only deteriorate if no action is carried out, ”deplores the management of the TVA group by email.
New insufficient income
The losses of nearly 60 million in 2023-2024 only concern the activities of the VAT network, not those of the group’s specialized channels. Despite the drop in cable subscriptions and the losses caused by TVA Sports, specialized channels remain profitable, largely thanks to the good results of the LCN information chain.
It should also be noted that CRTC figures do not take into account the new sources of income drawn by the major media empires from subscriptions and advertising on their online platforms.
At Quebecor, it is specified, however, that the profits from ILICO+ and VAT+ “are far from compensating for losses in advertising revenue incurred by VAT”.
The VAT group once again challenges the two government orders and claims various regulatory changes to allow private TV to get their heads out of the water. The broadcaster also accuses Radio-Canada of “direct and unfair commercial competition” by occupying part of the advertising market.
“Advertising, the main source of income for private broadcasters, should be withdrawn from all its platforms, as is already the case for its radio,” said TVA.
Noovo caught up in the drop in income
The other large private television network, Noovo, registered in 2023-2024 a loss, before interest and tax, of almost 50.3 million. As with TVA, Noovo’s losses are less than those of the previous year because the chain reduced its expenses. Recipes have been declining for two years.
In a written declaration, Bell Média specifies that his strategy is oriented towards different platforms, and not only on his general channel. The company is also campaigning, that said, for regulatory reductions before the CRTC.
“These measures are a fundamental lever to ensure the financial sustainability of linear channels in a changing media landscape », insistment Suzane Landry, Vice-President, Content Development, Programming and Information for Bell Média in Quebec.
Expression of expenses
Until 2021, revenue and expenses followed the same curves significantly in the two large private channels. The acquisition of a general network by Bell changed the situation. The expenses associated with TVA and Bell then exploded, while the revenues did not follow.
“There was a new player who was scary. You cannot blame TVA for reacting by investing a lot to defend its position. And either cannot be criticized for Bell for having invested in making a place, ”explains Denis Dubois, who was vice-president of original content at Quebecor at that time.
This war brought Quebec production to an never equaled level. We are now starting to see a drop in production.
Denis Dubois, then vice-president of original content at Quebecor
The one who left his post in 2023 now expects that Quebecor and Bell Média continue to considerably reduce their investments in production to return to balance. He is sorry for Quebec culture, but understands that the private sector cannot afford to lose money.
A researcher associated with the media pole of HEC Montréal, Louise-Hélène Paquette recalls that the investments of Bell Média have not been in vain. Noovo has seen his listening ratings increase on several slots compared to the time when the chain was called V. that this was not translated as significant increases in advertising revenues demonstrates, according to her, that the business model of private television is today to be reviewed.
“Of all the media, television is still the one who joins the most people. We often hear that people have deserted TV for foreign platforms, but in fact, income has dropped much faster than the audience. In Quebec, our TV remains very dynamic. Now we should find the means that it is profitable, ”notes the researcher.
