Political Economy of Media: Newfoundland Capital Corporation Limited

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Political Economy of Media: Newfoundland Capital Corporation Limited

Newfoundland Capital Corporation Limited (Newcap) is a pure-play radio company based in Canada. The corporation owns Newcap Radio with over 95 radio stations across Canada (Newcap Radio, n.d). According to the company’s web page, the operations of the company are divided into two major segments. That is the broadcasting segment concerned with the firm’s radio and television licenses, and the corporate segment whose operations is concerned with hotel services as well as head office functions (Newcap Radio, n.d). The company is owned by Harold R. Steele who is also the chairman and majority shareholder as well as the Chief Executive Officer. Steele had worked as a navy officer for 24 years before becoming the vice-president of marketing in the Eastern Provincial Airways before fully taking control of the airline in the early 1970s before venturing fully into the organization (Newcap Radio, n.d).

The study of this corporation was conducted based on the available literature regarding the company as well as the company’s web page. This is because the historical achievements that the corporation has undergone are well documented in literature. According to the findings, the corporation has been able to realize tremendous growth in the recent past. For instance, in the year 2004, the organization launched the Canadian Hit 30 Countdown which for a very long time remained Canada’s contemporary hit radio (Newcap Radio, n.d). Later, the corporation also sponsored Canada's Aboriginal Voices Network. This entailed a radio network that majorly focused its broadcast content such as music and other programming to suit the aboriginal people. This enabled the Aboriginal group to share ideas and opinions and to promote their cultural heritage. Additionally, in the year 2008, the corporation decided to trade its CFLT FM which was licensed to Dartmouth to Rogers Media – one of Canada's biggest publishing company at the time – in return for an AM radio station known as CFDR which was later moved to an FM station by the year 2009(Newcap Radio, n.d).

            What is more, in the year 2013, BCE subsidiary Bell Media sold a total of five radio stations, two from Toronto and remaining three comprised Vancouver stations to the Newfoundland Capital Corporation Limited for over $112-million. Presently, the company is able to reach its audience through its horizontal integration where it has merged a wide range of platforms including radio programs as well as sales and networking, in addition to hotel facilities. In the location of its radio throughout Canada, various aspects of spatialization have been put into consideration. For instance, each of the channels such as Ocean 100, New Country 92.2 and the Giant 101.9 has its uniqueness in terms of programming and location. Besides, the television stations, on the other hand, include CITL-TD which serves as an affiliate of CTV.

The corporation, being part of an oligopolistic market structure, has been able to realize huge profits. This is because, through its innovation as well as incorporation of a wide range of products such as radio stations with numerous programs and the TV stations, in addition to the hotel services, it has managed to compete favorably. As hardy (2014) observes, greater innovation coupled with increased quality enables a firm to develop the capacity to cater for wide range of customer interests which in return promotes an organization. This way, Newfoundland Capital Corporation Limited has been able to reap profits in spite of the stiff competition that has dominated the sector. According to the financial performance of the organization for the fourth quarter period that ended in the 31^st December 2016, the company recorded a profit of $10.4 million which was $2.5 million more than the amount recorded in a similar quarter the previous year. Rob Steele – the Chief Executive Officer who is also the president – observed during an interview that the 2016 record of success was as a result of their ability to grow revenue (Dartmouth, 2017)

The major challenge that Newfoundland Capital Corporation Limited is presently facing basically originates from the hostile market environment which makes it difficult for the company to invest in lucrative projects. In the recent past, Newfound Capital’s operating cash flow has been at par with its overall debt ratio. Such a condition has been able to derail the normal operations of the organization especially when it comes to meeting its short-term obligations. However, despite the challenges, Newfoundland Capital has successfully been able to meet its short-term financial obligations with its cash holdings such as lease and interest payments in addition to salaries (Newcap Radio, n.d.).

In summation, it is established that Newfoundland Capital is not only having a wider network of operations ranging from broadcasting to hotel services, but also generates a healthy cash flow. This can be attributed to the variety of strategies that the organization has adopted to ensure it remains appealing to its audience and customers through the incorporation of numerous services and products. However, the occasional drawbacks that the organization continues to experience calls for more innovation coupled with creativity.