MTV Networks International has announced that they are terminating their agreement with Craig Media Inc.
According to a CHUM press release, the channels MTV Canada and MTV2 will now be re-branded as of June 30, 2005. CHUM hasn’t said exactly how the networks will be re-branded, but since they already run two music video stations, the new acquisitions could be drastically revamped.
CHUM purchased the rights to MTV Canada and MTV2 in its acquisition of Craig Media on December 1, 2004. MTV Networks International reserved the right to terminate their contract with Craig Media Inc. in the event of a change in control to the entity that owned and operated the channels.
CHUM will now have to pay out the licensing fees remaining under the terms of the agreement, amounting to roughly $10 million. MTV Networks International will forfeit the right to acquire an equity interest in the new channels.
The Globe And Mail reports that the relationship between CHUM and MTV has been tense for a while now. Back in 2001 when Craig Media announced it was bringing the MTV brand to Canada, they were given a licence as a “youth lifestyle” channel, but when they actually went to air, the programming was mostly music-related. CHUM went to the Canadian Radio-television and Telecommunications Commission and complained, forcing MTV to alter their format to better comply with their guidelines.
MTV Canada was only available on digital cable or satellite services and had 800,000 subscribers. MTV2 was significantly less popular with only 265,000.
MTV put out a release saying it “remains committed to Canadian audiences” and they will announced their future plans in the coming weeks.
