Regulator approves WOW’s new kids channel

Canada's CRTC approved WOW Networks' acquisition of the Bell Media channel, Comedy Gold, which it will transform into a new platform for Canadian kids.
July 11, 2018

Canada will soon have another kids linear channel in its midst, as regulator, Canadian Radio-Television and Telecommunications Commission (CRTC), has approved Toronto, Canada-based WOW Networks’ acquisition of Bell Media’s Comedy Gold channel assets.

The US$5.1 million (CAD$6.8 million) deal will see the former vintage-comedy channel with a boomer bent transform into one targeting Canadian children and youth, with Bell Media becoming a minority shareholder in the channel. The new channel, as yet unnamed, will be granted a new licence under which to operate.

The approval is one that is likely to gain a warm reception by Canadian producers, who have seen the domestic market shrink under multiple waves of consolidation and market forces. In a statement to Playback Daily, Reynolds Mastin, president and CEO of the CMPA, called the approval “good news for both Canadian producers and audiences alike.”

“In recent years, we have seen fewer shows commissioned by existing broadcasters, so a new voice in kids programming is certainly a welcome development,” he says.

The commission itself declared the transaction to be “in the public interest,” stating that it would increase the variety of programming for Canadian audiences.

The deal will also modestly increase funds available to indies, with a tangible benefits package being generated worth 10% (US$524,000) of the purchase price. As per regulations, 80% of the package is allocated to funders and 20% is to be dispersed by WOW at its discretion. In its application, WOW proposed the 20% be dedicated to an eponymous short-form content funding program, but the CRTC deemed the proposal self-serving and asked WOW to return with a counter-proposal for the funds by August 9th.

Of the portion of the benefits package earmarked for funders, 60% is required to be allocated to the CMF and no more than 40% to independent funds. The CMPA and Shaw Rocket Fund requested the split be amended to 48% for the CMF and 32% to the Rocket Fund, since the Fund, they argued, is best suited to deploy these funds to producers in the children’s and youth sectors.

The commission did not approve the amendment, however, but noted that WOW may, in its revised proposal for the remaining 20% of its benefits package, choose to to instead allocate those monies to an indie fund such as the Rocket Fund rather than a new program to replace the proposed Wow Shorts.

Canadian Programming Expenditures (CPE) and Programs of National Interest (PNI) also proved a contentious area of the licence review process. Comedy Gold’s last renewal moved it in line with Bell Media’s group licensing, which carried a PNI of 10% and CPE of 30%. The CMPA and Writers Guild both argued that its expenditures should remain consistent with those levels. The CRTC determined, however, that the channel is now effectively an indie and should be treated as such, with no PNI requirement and CPE set at a “floor” of 10%. WOW’s adherence to the spirit of the Cancon regulations—to use independent production companies as well as its own assets—will be reviewed at its licence renewal, the decision states.

WOW Networks is a subsidiary of WOW Media and is led by CEO Michael Hirsh, COO and president Neil Chakravarti and CCO and Frederator CEO Fred Seibert.

Since launching in 2016, WOW has been building out a new multiplatform kids media universe, including founding companies Rainmaker/Mainframe and Frederator, the subscription Cartoon Hangover Select channel on the VRV platform and the new linear channel. Hirsh told Playback a new service will be announced soon as well.

“We have a lot of OTT plays, both on YouTube and SVOD, and this will expand our reach to ever-changing, ever-growing audience that is out there,” says Hirsh of the new linear channel. He declined to share any insight on programming but promised news would be forthcoming. “We just got the news this morning, so we’re solidifying our programming plans and we’ll be announcing things shortly.”

From Playback.

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