CBC, CAB face opposition in bid to delay local avails and VOD reviews

A request by the CBC and the Canadian Association of Broadcasters (CAB) to delay two CRTC framework proceedings - one on local avails and another on video-on-demand - has met with stiff opposition from broadcast companies and content producers. A majority of the 18 companies-including big names like Bell Canada, CTV globemedia, Telus Corp. and Rogers Communications -who have filed comments with the CRTC oppose the proposal by the CBC and CAB to push back the two proceedings by 12 months. Citing an increased workload on the CRTC because of two major hearings scheduled for early this year, the global economic crisis and lack of credible information on which the CRTC could count on, CBC is urging the federal regulator to delay. "The Commission and the industry have a number of balls in the air and nothing in our view, would be lost by deferring these two proceedings," writes Bev Kirshenblatt, senior director, regulatory affairs. But Ann Mainville-Neeson, Telus director for regulatory affairs, wireless, broadband, and content policy, says the CBC justification for a deferral holds no water. "We understand that there is a lot going on and we are all a little struck for time given the numerous proceedings that the commission has launched, but to delay it almost indefinitely for more than 12 months-because the CBC does mention 12 months or more-we find will be absolutely unacceptable," she says. Advertising on non-Canadian programs, known as local avails, allows BDUs to insert announcements or promotions within such programming. Current conditions of BDU licensing allows them to utilize 75% of local availabilities to promote Canadian programming and 25% for promoting their own services, which may include some non-programming services. BDUs, however, have requested that they be allowed to use local availabilities to sell commercial advertising to generate more revenue for Canadian broadcasting. The CRTC has also expressed that new forms of revenue generated on local avails should be used to enhance new forms of advertising content on digital platforms, hence the proposal from the CRTC to explore new regulatory frameworks. The deadline for comments is Jan. 15. However, the CBC/CAB deferral request prompted the CRTC to ask stakeholders to respond to both organizations' proposals by Jan. 2, which elicited 18 comments. Regarding VOD services, the proposed regulatory framework seeks to establish a gamut of issues that touch on packaging (known as subscription Video-on-demand, SVOD), flexibility on new business models, access issues, VOD advertising, licensing issues and ownership of VOD undertakings by BDUs. In addition to the current economic slowdown, the CBC says in its letter to the CRTC that the advertising market has become more challenging for all players and that introducing new advertising measures that will increase competition will be detrimental. It also notes that while new platforms may offer new ways of generating revenue, "the advertising dollars themselves are not ." Mainville-Neeson disputes that as an adequate reason for a deferral. "We do have to move forward in looking at new forms of advertising. We do believe that advertising is good stimuli for the new economy. And so saying that the state of the economy does preclude us from looking at new ways of advertising is just not particularly productive in our view." Brian Anthony, CEO, Directors' Guild of Canada, called the CBC request an "unnecessary delay", saying the sooner new regulations are in place for VOD and local avails, the sooner more money will flow for Canadian programming. "In both cases we don't want to have the CRTC see the horse leave the barn ahead of the hearings," Anthony told Canadian Communications Reports. "In case of local avails, this is one of the few opportunities to grow the pie to get more revenues flowing into the system, and we feel that deferring of that will push back the impact of revenues and will be particularly harmful to creators of film and television programming." Anthony also dismisses the CBC claim that other hearings will impede progress on the two proposed regulatory frameworks, adding that a bigger workload at the CRTC isn't exceptional and people have to adjust accordingly. "Also we know what 2009 was going to look like in terms of these CRTC hearings so I don't understand why this last minute appeal for a deferral," he says. "It doesn't make any sense to us quite frankly."

CBC, CAB face opposition in bid to delay local avails and VOD reviews

Broadcast | January 7, 2009

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