CourtTV battle shows negative effect of CRTC’s transponder decision on customers

The CRTC’s decision last year to deny several broadcasters the right to lease satellite transponders directly from Telesat Canada has ultimately resulted in thousands of primarily digital cable and satellite TV subscribers losing access to a channel focusing on court and legal issues. The situation will likely force the regulator to get involved in the matter and potentially highlights a need for the commission to play a more active role in transponder issues – something small cable operators have requested. Shaw Communications Inc.’s decision to unilaterally drop CourtTV U.S. from its cable and Star Choice Communications satellite TV lineups earlier this month has left nearly 400,000 Shaw and Star Choice subscribers without access to the U.S. specialty channel that launched in Canada in 1999 (CCR Update, April 3/02). With Shaw and Star Choice no longer carrying CourtTV U.S., the signal will eventually be dropped from the list of signals provided by Shaw-owned Canadian Satellite Communications Inc. (Cancom) to cable operators. That means that cable systems across the country relying on Cancom for the CourtTV U.S. signal will no longer have access to the channel. CHUM Limited’s inability to come to carriage terms with Shaw has left Shaw and Star Choice subscribers without the option of picking up a Canadian version of the channel with their existing distributor. And because CHUM doesn’t have carriage on Shaw or Star Choice, its CourtTV Canada signal is also not offered by Cancom, making it inaccessible to many cablecos, particularly small systems. When CourtTV Canada went on the air last September, distributors including Rogers Cable Inc., Bell ExpressVu LP, and Cogeco Cable Inc. replaced CourtTV U.S. with CourtTV Canada. However, Shaw opted to remain with CourtTV U.S. Small cable systems using Cancom’s CablePlus and HITS QT (Headend-in-the Sky – Quick Take) digital solutions have already lost access to CourtTV U.S. Others using the standard HITS digital service and those receiving the channel in analog will be cut off on April 30. Large cable operators in Ontario, and those interconnected to their systems, are receiving CourtTV Canada from CHUM via fibre. In a report filed with the CRTC in early 2001 on issues involving digital migration, the cable industry on behalf of small cablecos had asked for CRTC involvement on transponder issues. Later, in Public Notice 2001-130, in light of transponder lineup issues, the commission noted that its staff would contact the two Canadian satellite signal providers to discuss the issue of optimizing transponder lineups (CCR, Jan. 18/02). The CourtTV example highlights the impact the CRTC’s transponder decision has had on CHUM’s bid to get distribution for its Category 2 digital channels. CHUM says that if it had been allowed to retain control over a transponder on the Anik F1 satellite, it would have been able to provide the CourtTV Canada signal to small cable operators whose systems are compatible with Cancom technology. "As a result of the termination of CourtTV U.S. by Cancom, it may have implications on small and mid-sized operators who are relying on Cancom to receive that service," Allan Schwebel, VP of affiliate sales and marketing at CHUM Television tells CCR. "If we had our own transponder, any distributor who wanted to receive CourtTV Canada (and other CHUM Category 2 diginets) could receive it on the CHUM transponder and not have to go through Cancom." In Order 2001-133 dated Feb. 12, 2001, the CRTC sided with Star Choice in a heated transponder dispute, preventing CHUM, Netstar Communications Inc. (now part of the Bell Globemedia family), and Alliance Atlantis Communications Inc. from becoming their own carriers. Star Choice filed a Part VII application under the Telecommunications Act to override a private contract that appeared to give Telesat the right to claw back four satellite transponders from Star Choice and lease them to CHUM, NetStar, and Alliance Atlantis (CCR, Feb. 14/01). These broadcasters wanted to use the transponders to launch Category 2 digital channels. But the commission said it would monitor the situation, and the CourtTV matter may force it to get involved. "The commission reiterates that it is essential that all Category 2 services have an equitable opportunity for negotiating carriage," the CRTC stated in Order 2001-133. "This will help ensure that Canadian subscribers have a wider choice in programming. In this regard, the commission will closely monitor the situation to ensure equitable treatment of programming undertakings." CRTC commissioner Andrew Cardozo had warned about the potential for Star Choice/Cancom "being in a monopolist or controlling gatekeeper role". He added that the above quotation from the majority decision should have been the core of the order. "The inclusion of these three players in owning the transponders in question adds the all-important diversity to the distribution system, as it reduces the controlling gatekeeper role of any one party," Cardozo wrote in a dissenting opinion to Order 2001-133. CHUM still talking with Shaw Schwebel says CHUM continues to negotiate with Shaw, but is not willing to sign a deal that would undercut existing agreements it has completed with other distributors. "We’re trying to find a commercial resolution of this matter consistent with the arrangements that we’ve done with other distributors," he says, noting that CHUM has not ruled out filing a complaint with the CRTC. "(The CRTC complaint process) is always a possibility. But it’s a very difficult and time-consuming process to take a key client before the commission. One doesn’t do that lightly. We’re hopeful we can still reach a direct resolution so that Star Choice and Shaw subscribers can continue to enjoy the day-time trial programming (on CourtTV U.S.) and the blackout free evening programming that we’ve been able to acquire for this marketplace." No one at Shaw had returned CCR’s telephone calls on the matter at press time. Shaw has placed a message on the channel that used to carry CourtTV U.S. stating that the station is no longer available due to blackout requirements. Glenn Moss, senior VP of business affairs and affiliate relations at New York-based CourtTV U.S., notes blackouts are necessary because the broadcaster only has U.S. cable network rights to some programming, mostly that aired at night and during the evening. He takes issue with Shaw’s on-screen message, noting that the blackouts on CourtTV U.S. have always been in place and that there is another option – CourtTV Canada. Because CHUM holds the Canadian rights to much of the programming such as Cops and Homicide that appears on CourtTV U.S., the two formed a partnership and jointly launched CourtTV Canada. The Canadian channel carries the daytime court proceedings found on CourtTV U.S., while CHUM programs the evening and weekend time slots. Moss says that after confirming that some blackout notices weren’t being complied with by Shaw, CourtTV U.S. began blacking out the signals at its facilities. When that happened, Shaw dropped the channel altogether. "We’re taking a bit of a hit now (in lost subscription revenue)," Moss says. "But we feel the best solution in the long run is CourtTV Canada in terms of extending our brand, making inroads in the Canadian market, and solving the blackout problems." CHUM had been applying some pressure to have CourtTV U.S. subscribers convert. A message on the CourtTV Canada web site addressed to Star Choice and Shaw subscribers of CourtTV U.S. explained why CourtTV Canada was unavailable to them and noted that it continuted to negotiate to have the Canadian channel made available to them without any packaging or pricing changes. The message read: "We urge you…to help facilitate the change by contacting Star Choice and Shaw through phone or email and letting them know that you would like to receive the CourtTV Canada black-out free service." The message was dropped from the web site after Shaw pulled CourtTV U.S. from its cable and satellite lineups.

CourtTV battle shows negative effect of CRTC’s transponder decision on customers

Broadcast | April 12, 2002

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