New digital licensees find way to ensure carriage of their Category 2 channels

Three Canadian broadcasters decided to lease their own satellite channels because they couldn’t reach an acceptable agreement with Star Choice Communications Inc, Telesat Canada maintains in a Jan. 12 letter to the CRTC. It’s a move that essentially guarantees the launch of Category 2 channels licensed to NetStar Communications Inc/CTV Inc, Chum Ltd and Alliance Atlantis Communications Inc – and on their terms and conditions. The battle over four disputed transponders on the recently launched Anik F1 satellite is now before the CRTC, which issued a call for comments Dec. 22 (PN 2000-178) on a Star Choice petition to prevent Telesat from leasing the transponders to the three broadcasters (CCR, Dec. 21/00). The deadline for comments was Jan. 12. Star Choice has until Jan. 19 to reply. Star Choice says it has a contract for 29 transponders on Anik F1, despite a provision in the deal that gives Telesat the right to "claw back" up to four transponders until it accepts in-orbit delivery of the satellite from the manufacturer in February. Telesat is attempting to paint itself as a neutral party in the debate, which is a necessary tactic considering its family ties to BCE Inc and the fact that as a common carrier it cannot take sides in allocating satellite capacity. Star Choice alleges that Telesat is giving "unlawful preferential treatment" to itself and its affiliates. BCE owns Telesat, Bell ExpressVu and NetStar/CTV. Telesat disputes such claims, saying it was the broadcasters who asked for the transponders. " ...Clearly they would make this request only if they found that the terms and conditions under which they could take that capacity from Telesat better met their requirements than what Star Choice was prepared to offer them," the carrier writes. The CRTC also received letters supporting Star Choice’s petition, including several from DTH customers and dish dealers worried that ExpressVu would have a competitive advantage if Star Choice lost the transponders. One satellite dealer in Victoria BC says the ownership links between BCE and its affiliates give "the appearance of conflict of interest." As such, it suggests that BCE should be forced to sell Telesat. Rogers Media Inc is also siding with Star Choice. The company argues in its Jan. 12 brief that transponders secured through the claw back provision were to be used exclusively for existing services. Rogers points out that NetStar, Chum and Alliance Atlantis plan to use the capacity to carry their newly licensed digital channels. "The programmers can fill the transponder channels with their Category 1 and 2 services, and supply their services to Star Choice," Rogers writes. "While other Category 2 services not carried by Star Choice may be able to seek carriage on Star Choice by negotiating access with the programmers for carriage on one of the transponders, there is no guarantee such space will be available." Telesat points out, however, that if Star Choice controls all the satellite capacity, then it alone decides which Category 2 channels are launched. The company writes, " ...With more than 260 Category 2 licenses awarded, and given all the other services it is required to carry, it seems unlikely that Star Choice could carry all these Category 2 services, even if no transponders were clawed back. Star Choice therefore will be placed in the position of choosing the ‘winners and losers’."

New digital licensees find way to ensure carriage of their Category 2 channels

Broadcast | January 17, 2001

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