Broadcasters want cablecos to insert their commercials on U.S. superstations

The Canadian Association of Broadcasters (CAB) wants the CRTC to force Class 1 broadcast distributors to insert their commercials on U.S. superstations. Signal - or simultaneous -substitution is common practice on other U.S. channels when a Canadian broadcaster carries the same program at the same time as the American service. As of September 1999, Canadian cable and DTH residential subscribers received the following U.S. superstations in the indicated percentages (out of a total base of 8,638,559 cable and DTH residential subscribers): KTLA-TV: 7.9%WGN-TV: 11.4%WPIX-TV: 7.2%WSBK-TV: 9.61%WTBS-TV: 41.9% Source: CAB letter to CRTC,March 7, 2000But in a March 7 letter to the CRTC, the CAB says some broadcast distribution undertakings (BDUs) comply with such simulcast requests, and draw no distinction between U.S. superstations and any other distant station. Others refuse to comply with requests, claiming the BDU Regulations do not require them to perform simultaneous substitution over U.S. superstations, that the benefits of doing so are negligible, and that the costs involved are prohibitive. "The potential value of simultaneous substitution to the Canadian broadcasting system is beyond question," the CAB writes. "It makes good sense that its full value can be realized only when it is consistently and fairly carried out." The CAB says substitutions would only occur when a superstation is carrying a program that a Canadian broadcaster owns the rights to in this country. It would also only occur when the superstation and Canadian broadcaster were airing the program at the same time. Its main argument, however, is that the regulations authorize and require cable operators to carry out simultaneous substitution over U.S. superstations. As it points out, the regulations do not include an exemption for American superstations. "Section 30 of the BDU Regulations provides that a Class 1 licensee shall, upon written request, delete the programming service of a television station and substitute the programming service of a local television station or a regional television station if the services to be deleted and substituted are comparable and simultaneously broadcast." Simultaneous substitution, which has been allowed in Canada since 1971, generates about $150 million annually for Canadian broadcasters. Some U.S. stations have complained about the practice in the past, but the CRTC has stood by its licensees, recognizing that when a broadcaster buys the Canadian rights to a program, it has to the right to overlay its commercials onto a U.S. signal that is spilling over the border. The CRTC has stated in past proceedings that simultaneous substitution protects the Canadian rights markets, and as such, the advertising base of local and regional television stations so they can meet their commitments to Canadian programming. "Any inconsistent interpretation or application of the BDU Regulations undermines the program rights protection that is essential to over-the-air Canadian television stations," the CAB writes in its application. "Therefore, clarification of the simulcast obligations of BDUs is essential, so that broadcasters and distribution undertakings may ensure that the Commission's simultaneous substitution regime is followed fully and consistently."

Broadcasters want cablecos to insert their commercials on U.S. superstations

Broadcast | May 25, 2000

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