As the end of the contract for the broadcasting rights to National Hockey League (NHL) games approaches, things are going badly for sports television in Quebec. The French-language sports channels belonging to the two empires in the media and telecommunications sector are losing record amounts.
Owned by Bell, RDS lost $22 million before taxes in 2023 including RDS Info, while TVA Sports (Quebecor) lost $18 million.
The total losses thus reached 40 million, more than double the losses of the previous year, according to the figures that the Canadian Radio-television and Telecommunications Commission (CRTC) has just made available for the broadcast year ending August 31.
RDS was once the most profitable French-language TV channel in Quebec and one of the most profitable in the country. In 2016, RDS and RDS Info together generated profits totaling $22.5 million.
TVA Sports has always been in deficit, having lost money every year since its creation. In 12 years of existence, TVA Sports has now lost approximately 242 million.
Revenues fell by 5% to $146 million at RDS last year, while they fell by 16% at RDS Info. At competitor TVA Sports, revenues fell by 3% to $93.4 million in 2023.
Subscriber erosion continues to be problematic. CRTC data shows that RDS lost 7% of its subscribers in 2023, or 112,000 subscribers, while TVA Sports lost 9% of its subscribers last year, the equivalent of 115,000 subscribers.
Meanwhile in English Canada, the two major sports networks continue to generate tens of millions in profits. TSN generated $88 million in pre-tax net profits in 2023, an amount similar to what Sportsnet has earned in profits from its licenses.
For a second year in a row, however, the number of subscribers to both TSN and Sportsnet shows a decline of 5%.
Expert advice
While national advertising brings in much more revenue for TSN and Sportsnet than for RDS and TVA Sports because of the larger audience that can be reached, Pierre Bélanger, professor emeritus in the Department of Communications at the University of Ottawa, finds it “extremely worrisome” to see a decrease in the number of subscribers to both French-language and English-language sports channels, while the Canadian population is growing rapidly.
“It’s a big problem,” he said.
An interesting question is asked by his classmate Luc Dupont, a professor at the University of Ottawa and a specialist in media and marketing. “Is hockey as popular today as it was 20 years ago? Even if the Canadiens are a must-see in Quebec, the answer is no,” he says.
Pierre Bélanger sees less than encouraging signs for future profitability, as RDS and TVA Sports, for example, each pay about $60 million a year to broadcast Canadiens and NHL games. A decision will have to be made soon because the 12-year agreement signed by Quebecor in 2013 for NHL hockey expires at the end of the 2025-26 season.
“Quebec is a market with its limits and TVA Sports could not foresee at the time of signing the contract that the Canadiens would miss the playoffs so often,” says Luc Dupont.
“The crux of the matter in this negotiation was the playoffs. And when your team is gone, it’s a lot less interesting for the average viewer.”
Pierre Bélanger agrees. “The Canadiens rarely make the playoffs, which drags the networks down. And TVA had bet a lot on a possible return of the Nordiques. There are surely also managers who thought that Stephen Bronfman’s project to bring the Expos back to Montreal would succeed,” says Professor Bélanger.
With the return of the Nordiques and the Expos, and the Canadiens standing out during the end-of-season series, the picture would be completely different.
Pierre Bélanger, professor emeritus in the communications department at the University of Ottawa
It’s more of a perfect storm hitting, he says.
The following
If Rogers, owner of Sportsnet, intends to renew its broadcast agreement with the NHL, Pierre Bélanger believes that the company should consider doing so in partnership with Bell rather than with Quebecor.
“Could we imagine for the survival of Canadian antennas or showcases that the CRTC authorizes a joint venture to divide the cost of the bill that will be excessive?” asks the professor emeritus. “The leaders will then agree to share the hockey content to be broadcast.”
In the eyes of this expert, the financial losses at RDS – as disappointing as they may be – are not catastrophic in the sense that profits at TSN can absorb the deficit at RDS. “That’s the cost of doing business in Quebec and not giving Quebecor a free hand. Because Bell must be telling itself that it will end up breaking Quebecor and that when that time comes, the numbers will change color.”
He therefore sees it as a war of attrition. For him, the business model of TVA Sports is broken and the fact that TVA Sports has never made a profit is revealing.
The management of the TVA Group indicates to The Press by email that the results of TVA Sports are particularly affected by the decline in advertising revenues “affecting all media”.
“In addition, there is the issue of specialty channel royalties, which particularly affects TVA Sports,” he added. “This fair market value, not granted to date by Bell TV, contributes to the difficult financial situation in which TVA Sports finds itself. The issue is currently in arbitration before the CRTC and we expect a decision to this effect by the end of the summer.”
Bell could not be reached for comment.