ICTA announces consultation over local programming obligations
Cayman’s television networks are at odds over their obligations to produce local content, with the island’s oldest broadcaster claiming its new rivals currently have an “unfair advantage.”
Regulators are being pressed to properly define and enforce rules that require television companies in the Cayman Islands to carry some local programming.
WestStar says the regulations are too vague and that the future of Cayman 27, which is a loss-maker for the company, is threatened if rivals like Logic and LIME don’t have to make a genuine investment in local television. They have set up a website, www.savelocaltv.ky, urging viewers to let the Information Communications Technology Authority know how important the channel’s content is to them.
Logic uses the Cayman Islands Government Television station, and LIME broadcasts a new channel called Nexus, which it describes as a “vibrant alternative to Cayman 27,” to meet an obligation to screen at least 4.8 hours of local content a day.
ICTA this week announced plans for a consultation process to determine whether a stricter definition of local content should be required.
LIME says it has made a serious commitment to local television through its new channel. Logic says it is providing a public service through its broadcast of CIGTV on channel 23.
Bill McCabe, chief executive officer of LIME, welcomed the ICTA review but denied that WestStar was the victim under current regulations. He pointed out that the former monopoly holder offset its costs through advertising revenues and, unlike new entrants to the market, did not have a direct requirement in its license to carry a set amount of local programming.
WestStar CEO Bob Taylor said the company, which launched in the early 1990s, had invested millions in creating Cayman 27 as part of its responsibility to produce local content.
He said allowing rivals to use government’s television station as local content meant they were essentially being subsidized by taxpayers because the channel receives $500,000 in annual government funding.
WestStar is also concerned that the lack of a clear definition enables its rivals to produce low-cost content with no real requirement to invest in genuine local programming.
Mr. Taylor acknowledged that WestStar was not explicitly required through its current licensing agreement to produce a specific type or amount of local content. But he said Cayman 27 had developed in response to clear guidelines set by politicians at the time and in its original license which predates the ICTA.
He accepted that, hypothetically, the company had the option to make a business decision to scrap the channel and use government television or a low-cost alternative.
But he said Cayman 27, through its news coverage, talk shows and broadcasts of community events, provides a public service that could not be matched in a democratic society by a government-owned and funded television station.
He said a more rigorous definition of “local content” was required to ensure that the purpose of the regulation was fulfilled.
“What does local content mean? Does it mean you just have to show a picture of a tree growing in the Cayman Islands or does it mean you have to show something every day?” he asked.
Traci Bradley, the company’s director of operations, said WestStar’s rivals also had the option to pay to screen Cayman 27 or they could produce a rival channel.
“We have gone above and beyond the bar that was set for us. We are not asking for everyone else to go above the bar. We are just asking for there to be a bar,” she added.
Mike Edenholm, CEO of Logic, said the company believes that using the government television station adequately satisfies the requirement for local content.
“Logic launched Channel 23 in conjunction with CIGTV on November 30, 2013,” he said. “Logic is proud to support this television broadcast service as a benefit to all the citizens and residents of the Cayman Islands…
“Logic is very supportive of public/private partnerships and applauds the government’s support of this project.”
Mr. McCabe of LIME said his company showed its commitment to local television through its channel NEXUS and would be introducing more programming in the new year.
He said LIME is happy that ICTA is looking into the situation and agreed that the policy should be clarified to create a level playing field. But he disputed WestStar’s claims that its rivals had the upper hand under the current rules.
“New entrants to the TV market have obligations to provide local content, and LIME has re-energized the segment with the launch of NEXUS. Perversely, WestStar has no such obligation as part of its license, tipping the competitive advantage further in WestStar’s favor,” Mr. McCabe said.
LIME is also urging ICTA to take a more active role in policing contents rights. HBO Latin America complained earlier this year that WestStar was offering the network’s content to viewers without its agreement.
Mr. McCabe added, “One of the major areas for the ICTA to tackle will be content rights. LIME sources its programming from legitimate, paid-for sources, but it is clear that certain TV providers operating on island do so without the knowledge or agreement of the content rights holders.
“This situation does not paint Cayman in a good light internationally and skews competition in favor of those who are prepared to ride roughshod over international good practice.
“We would urge the government and the ICTA to take steps to regulate all content both local and overseas to ensure competition is based on a level playing field.”
In a press statement this week, ICTA said it would be calling for “inputs from all those interested in the future of local television” on the issue of local programming in early 2014.