CAB concerned over Shaw’s merger plans

The Canadian Association of Broadcasters (CAB) is concerned that a move by Shaw Communications Inc to merge its cable and satellite units will prompt the new corporate entity to renegotiate existing affiliation agreements – PN 2001-95. If the CRTC approves the merger, the CAB warns that the commission should forbid any changes to existing affiliation agreements without permission from the programming service.In its Sept. 17 filing to the regulator, the CAB insists that any renegotiation of existing agreements with either Shaw cable or Star Choice Communications Inc be done in good faith, and not be automatically subsumed within the agreement still in effect with the other corporate entity. The broadcasting association also remains concerned about how Star Choice and Shaw will attempt to secure volume discounts without compromising the confidentiality of the separate affiliation agreements between programmers and the two distributors.The CAB wants the CRTC to ensure that Shaw clearly spells out how it intends to negotiate volume deals. This isn’t the first time the CAB has raised the red flag over this practice. It points to a letter sent by Cancom/Star Choice to CAB members indicating that it planned to adopt the network fees set by Shaw. The broadcasters contended that the letter demonstrated that Shaw was attempting to control the relationship between Cancom/Star Choice and its affiliates. The CRTC disagreed, however, and in Decision 2001-288 ruled that the move was a normal business practice. For its part, Shaw has given assurances that there will be no sharing of customer information between the sales, marketing and customer service staff of its cable and DTH businesses. But, the CAB wants the company to go even further. It has asked that similar procedures be put in place with regard to affiliation agreements between programmers, and Star Choice and Shaw cable. Shaw has sought CRTC approval to have regulatory firewalls between its cable and satellite divisions removed so that it can take advantage of corporate synergies (CCR, Aug. 30/01).

CAB concerned over Shaw’s merger plans

Broadcast | September 27, 2001

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