Windsor Star

What, exactly, is a sports bar?

Increased sports channel rates will have different effects on different establishm­ents

- SCOTT STINSON sstinson@postmedia.com Twitter.com/Scott_Stinson

One problem with trying to charge establishm­ents that show televised sports more money for those broadcasts is it leads to a weird philosophi­cal debate: What exactly is a sports bar?

This is among the many questions being thrown around in Canada’s restaurant industry with the recent news that Bell and Rogers, the owners of TSN and Sportsnet, will charge significan­tly increased rates to places with a liquor licence if they want to keep those sports channels in their programmin­g lineup.

Aside from the general sense of outrage that the sports media giants are throwing this change at them with little warning — the new prices are set to take effect on May 1 in most of Canada, later in Quebec — bar and restaurant owners are asking why every place that sells alcohol is being treated the same way. It’s a fair question. There are some establishm­ents that make live sports viewing a fundamenta­l part of their marketing. There are others that just want to have something on the TV from time to time, or where it’s usually a background distractio­n — something to keep the kids occupied when they are finished their chicken nuggets shaped like dinosaurs. When the new fees for TSN and Sportsnet — which, depending on television service provider and according to seating capacity, can run from an additional $75 a month to more than $650 monthly for larger venues — kicks in, the question of how much of a business is really based on showing live sports becomes significan­t.

One owner of about a dozen chain restaurant locations, who spoke anonymousl­y because he couldn’t comment on behalf of the parent company, says the new sports-channel fees would cost his business an additional $50,000 annually.

His restaurant­s sell much more food than drink — about 10 per cent of the sales are from alcohol — so he says he’s giving serious thought to just forgoing television services completely.

“I’d have unhappy customers come playoff time,” he says, “but certainly not every day.”

He notes, too, that he’s a larger operator who has a choice about absorbing the higher costs: “But for the average family restaurant? It’s crazy what they are doing.”

The “they” in this case refers to Bell and Rogers, which are changing their commercial rates to recapture revenue lost as more people choose not to have a cable or satellite television subscripti­on.

The telecommun­ications conglomera­tes have told restaurant and bar owners that live-sports broadcasts add significan­t value to their businesses, and they feel continuing to subscribe to TSN and Sportsnet at the new prices will be a good business decision.

For some, that is almost certainly true.

Even at an additional $250 monthly for a smaller bar, that would beat the alternativ­e of having no out-of-market TSN or Sportsnet feeds. But there are many establishm­ents where the math would not be so clear.

Statistics Canada says there were just under 42,500 table-service restaurant­s in the country last year, including fine dining, casual dining (The Keg) and family style (Swiss Chalet). On average, those places get about 20 per cent of their sales from alcohol.

Many have television­s in a separate bar area, or they have several television­s in a distinct bar setup and a few out in the larger restaurant. But since Bell and Rogers are requiring the new fees for the sports channels to be based on seating capacity, a place with a large seating area but few television­s would still be charged at the upper end of the scale.

There are other concerns. Many restaurant­s are licensed franchises, where the franchisee will have no choice but to pay the new costs since the corporate head office demands a consistent experience at all locations, and in some cases the largest chains would have the most leverage to force a better deal out of Bell and Rogers since they spend a lot of money as advertiser­s on their large media networks. The small bar? Not much leverage.

James Rilett of industry group Restaurant­s Canada says he’s asked to meet with Bell and Rogers executives and hopes they can work something out.

“But to make this big a change without any consultati­on at all? It does not bode well,” he says.

It’s worth pointing out here that the media companies are trying to charge more for something they believe has been undervalue­d for certain customers. It’s not larceny, though the Competitio­n Bureau might have thoughts on the timing of the changes made by would-be rivals.

What the changes will mostly do, I think, is force proprietor­s to decide how much they care about live sports.

It’s the kind of thing most patrons would figure out about any establishm­ent after a visit: does this place care about having the game on, or is it essentiall­y the wallpaper?

The new fees will probably go some way to separating the latter from the former.

One owner of about a dozen chain restaurant locations ... says the new sportschan­nel fees would cost his business an additional $50,000 annually.

 ?? STUART DRYDEN/FILES ?? Bar and restaurant owners will have to pay increased prices, starting May 1 in most of Canada, for sports channels.
STUART DRYDEN/FILES Bar and restaurant owners will have to pay increased prices, starting May 1 in most of Canada, for sports channels.
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