Rural communities to pay more for cable TV and high-speed Internet service

Under proposed changes to outdated microwave licensing policies, residents in smaller outlying communities could end up paying significantly more for cable TV and high-speed Internet service than those living in urban centres. The proposed changes have also sparked fears that service providers in those regions will have to dish out enormous amounts of money to upgrade facilities to handle newer transmission technologies as the industry prepares for the eventual transition from analog to digital. While there seemed to be consensus on the proposed streamlining and combining of the three older microwave policies in Canada Gazette DGTP-005-00, one contentious area may be the costs associated with the transition from analog to digital for broadcast distribution undertakings (i.e. cablecos) in communities that are sparsely populated (RoW, May 1/00). Sunshine Communications, a small cable TV and high-speed Internet service provider that uses the 12.7-13.25 GHz range in the Christina Lake area, fears the current licensing fee structure will make it virtually impossible to introduce new technologies in rural regions. The current fee structure is based on bandwidth use which costs $200 per 6 MHz of bandwidth or $13,000 annually to Sunshine’s 400 subscribers. The service provider states in its June 20 comments to Industry Canada that the fee structure has been well received by cable TV operators in large metropolitan cities, but doesn’t lend itself well to the rural regions of the country. "Presently subscribers in small Cable TV Systems such as Sunshine Communications, are paying 500% more for the privilege of using the same VHCM spectrum as a subscriber in a 100,000 subscriber cable system," it writes. "This inequitable method of Licence Fees will not promote or encourage new services in the rural and sparsely populated areas where this technology would be most needed and beneficial," Sunshine notes. It proposes that licence fees be collected much in the same manner as for the 38 GHz spectrum, with a levy of $0.50 per household in the coverage area. While both the Radio Advisory Board of Canada (RABC) and the Canadian Cable Television Association (CCTA) believe that upgrading to digital technologies is important to the evolution of the broadcast industry, they do leave room for smaller players to operate using current technology. "The (RABC) submits that, while it would agree with such a concept in the case of a VHCM operator converting a large percentage (say, over 75%) of its system to commercial traffic, it should not apply to the vast majority of cases whereby a VHCM licensee wishes to sell service to one or a small percentage of the total number of receiving points served by the VHCM system," it writes in its July 10 comments to the department. Both organizations agree that smaller service providers should have the choice of upgrading to digital or not. "Converting to digital transmission is not inexpensive," the CCTA writes in its July 6 submission. "Those who can afford it will do so; those who cannot should not be forced to." Look Communications Inc, on the other hand, suggests that the transition to digital transmission technologies, and its more effective use of spectrum, will free up valuable spectrum resources for other service providers. In its July 10 comments to Industry Canada, it submits that it could use the 12.7-13.25 GHz bands to provide bi-directional microwave links to its broadcast sites. In this light, "Look recommends that VHCM operators be encouraged to convert their systems to digital compression format. This would permit the most efficient use of the spectrum," it writes.

Rural communities to pay more for cable TV and high-speed Internet service

News | 08/21/2000 4:00 am EDT

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