Cayman 27 among five licences suspended by OfReg

Past and present TV station staff gather on Friday for Cayman 27's final broadcast.

Cayman 27, which ceased operations on Friday, is not the only licensee threatened to have their licence suspended for failing to pay outstanding fees to the regulator OfReg.

As of Friday, 30 Aug., there were five licensees, including Hurley’s TV, the parent company of Cayman 27, that remained delinquent of their licence fees and royalties.

Alee Fa’amoe, the acting CEO of OfReg, noted in an email to the Cayman Compass that all five licensees had been issued enforcement notices on 31 July and were due to have their licenses suspended as of yesterday, Sunday, 1 Sept. He did not identify the licensees.

Fa’amoe added that he would not make any further public statements until after a meeting with Cabinet this week. Cabinet typically meets on Tuesdays.

Randy Merren, managing director of Hurley’s TV. Ltd., cited the lack of cooperation from regulator OfReg as the main reason for the closure of Cayman’s only local TV news station, which had faced financial difficulties for almost a decade.

The company owed more than $100,000 in unpaid regulatory and licence fees to OfReg for a period going back to the final quarter of 2016.

Licensees are expected to pay 6% of their revenues every quarter, in addition to a regulatory fee.

This year, OfReg expects to collect about $4.6 million from regulatory fees overall and $1.97 million from ICT licenses.

Hurley’s TV had been at odds with the regulator over its ability to charge other cable TV operators for Cayman 27 programming.

Cable TV providers are under the obligation to offer public television at no cost to subscribers 24 hours a day every day of the year and provide at least 20% local content.

Merren said he had raised the financial viability of Cayman 27 with the regulator even before buying the TV station in 2015. But a fee or special fund paid for by each licensed subscription TV operator to carry Cayman 27 was never created by the regulator, contrary to the company’s expectations.

Alee Fa’amoe, acting CEO of OfReg

Ultimately, Hurley’s TV said it had “no choice but to terminate the channel’s current programming, as it is unsustainable under its licence requirements”.

TV providers have long claimed that local TV production was not profitable and the requirement of offering it free-to-air via analogue channels was outdated.

In 2014, Infinity Broadband, which trades as C3, said in its submission to the regulator’s public consultation on the future of local television broadcasting that it was subject to more stringent obligations in relation to public service television than other operators.

“No other licensee is required to provide 30% local content (C3 is the only licensee obligated to provide 30% local content whilst all other licensees are only required 20% or ZERO). It should also be noted that no other licensee is obligated to spend at least CI$400,000 on their studios for the production of local content programming,” Merren, who is also the managing director of C3, stated in its letter.

One year later, the TV licence issued to Hurley’s TV stipulated at least four hours of public content a day with at least two hours of first-time content and four hours per week of free community slots.

The licensee also had to operate a local studio from which to broadcast the service and produce its public content. Although the minimum expenditure of $400,000 was no longer required, no other subscription TV operator had to run a local studio as part of their licence requirements.

April Cummings, left, and Tammi Sulliman appear in the final Cayman 27 broadcast on Friday.

In Hurley’s TV’s case, the regulator defined public content as 60% local news, 25% local arts and culture, which includes talk shows and 15% local educational programmes, for example, college presentations.

How all of this is enforced is unclear. Premier Alden McLaughlin acknowledged in 2018 that the regulator is not enforcing that every licensee maintains a free-to-air analogue channel, because most of the population had access to cable television or streaming devices. Instead the regulator insists that they carry local content.

Without Cayman 27, this will become more difficult as simply carrying government television channel CIGTV will not be sufficient, according to OfReg.

Responding to questions in the Legislative Assembly, Premier McLaughlin said last year: “It is complex and expensive to set up and operate a TV station in a small market. With new technology, it is possible to create local content without the overheads associated with a television station, and there are several sources of video content carried on various channels.”

Some clarity is expected following OfReg’s public consultation on changes to ICT licences, which was first extended from 8 July to 29 July and then again to 16 Aug.

However, this will come too late for Hurley’s TV which was issued an enforcement notice before the end of the consultation period. Cayman 27 aired its final show Friday, with a blend of reporting on its closure and a nostalgic look back at its 27 years on the air.

3 COMMENTS

  1. Unfortunately Cayman 27 appears to have been a victim of heel dragging and mismanagement at OfReg. They seem to be excellent at issuing unaffordable bills to broadcasters but inept at ensuring they can generate the income by following the law with respect to cable companies.
    RIP Cayman 27. You will be missed.

  2. As the article reads: ,,, if A: ” This year, OfReg expects to collect about $4.6 million from regulatory fees overall and $1.97 million from ICT licenses.” > if Hurleys owed just $100K, then there are four other ICT licensees owing far more.
    B. ” Cable TV providers are under the obligation to offer public television at no cost to subscribers 24 hours a day every day of the year and provide at least 20% local content.” > So the other cable TV providers were using CITN as their own local channel? How is that fair without those cable providers paying CITN?
    C. ” Premier Alden McLaughlin acknowledged in 2018 that the regulator is not enforcing that every licensee maintains a free-to-air analogue channel,,,,” & ” the regulator insists that they ( ITC Licensees) carry local content.”
    D. “Without Cayman 27, this will become more difficult as simply carrying government television channel CIGTV will not be sufficient, according to OfReg.” > What the hell?

    OfReg has shot Cayman in the foot.

    No cable company can meet the requirements of their license agreement, since they do not have studios to produce local programs, nor do they pay their fees.

    Is it not time to fire the OfReg board?

    Govt should quickly meet and give Hurley Entertainment a new license and cancel the other 4 ICT licenses. Make the other cable licensees go dark until they can meet the requirements on their own or agree to pay Hurleys for CITN’s cablecast.

    OfReg got greedy and
    (1) split the cable pie into too many pieces,
    (2) did not offer a fair and even playing field,
    and (3) ran out the one local channel serving Cayman for 27 years!

    Caymanians, are you really gonna trust CI Govt TV to tell you the whole story, the next time corruption pops up? While you consider that, Who will cover local sports? CI Govt Tv does not have sportscasters, and they are not simply reporters on their day off.
    And who will forecast your local weather?

    Demand OfReg is dumped! New board & New leadership!

    Demand CITN is re-lit!

    After 27 years, we all may have taken CITN for granted.
    Please don’t let greed take your local broadcast voice away.

  3. Here are my questions and comment based on this article:

    The article states that Mr Merren was responsible for both entities, one which never got the financial support that had been discussed with the regulatory authorities and the other subjected to higher requirements (30%) than others who were at 20% or “ZERO”.

    Q1. Is there a bias against the individual or unlawfulness in the way the regulations were executed?
    Q2. If negotiations were held prior to the purchase of the company, why didn’t the government act in good faith?

    “Without Cayman 27, this will become more difficult as simply carrying government television channel CIGTV will not be sufficient, according to OfReg.”

    Because televised access to local news/information for the general population (to the extent that it was being delivered via Cayman 27) is not possible a great number of senior voters and any other voter without internet will be without the 6pm televised news, leaving them uninformed on matters that would have reached them via television through Cayman 27.

    Q1. doesn’t this restriction to information have the potential to negatively affect democracy?
    Q2. If the government is cognizant of the law regarding free-to-air tv and of the democratic value of independent tv, why did it not act lawfully?

    Further questions I have are:
    Q1. If we have a government that disregards democracy and undermines it, acts unlawfully and has an apparent bias towards its citizens, are we in a democratic society or are we living an illusion?

    Q2. Is this type of governance what the electorate voted for, is this representative of our expectations of our elected officials and will we be so gullible, so passive, like sheep led to slaughter, at the next election or will we change our voting style to change the abuse we have suffered so far and that we risk suffering even possibly to a greater extent in the future?

    My comment on this matter is:
    Election 2021 must show the Caymanian voter as being politically aware and intolerant to abuse.

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