Bell TV and Shaw Direct fight new requirement to carry independent local TV stations

A yet-to-be enforced regulatory policy governing the distribution of independently owned television stations on satellite has come under attack by Canada’s two satellite television companies. Both Bell TV and Shaw Direct have criticized a proposal to review the policy, arguing that proposed changes are premature and will undermine the viability of direct-to-home (DTH) carriers. Specifically, Bell TV and Shaw Direct object to regulatory changes in Broadcasting Public Notice 2008-100, which are expected to come into force on Aug. 31, 2011. The policy determines which television stations can be distributed on the basic packages offered by satellite carriers. It also stipulates that DTH carriers should distribute at least one independently-owned TV station from each province. In September, the CRTC issued a call for comments on rules governing the distribution of small market independently-owned television stations (SMITS), in response to a joint submission from Astral Media Radio GP, Corus Entertainment Inc., Jim Pattision Broadcast Group LP, Newcap Inc., RNC Média Inc., and Thunder Bay Electronics Ltd. The companies own 20 TV stations in small markets in 14 communities in Ontario, British Colombia, Quebec, and Alberta. They want satellite companies to distribute—at their own expense—14 specific SMITS to DTH subscribers within that small station’s broadcast region. The companies also want the satellite companies to distribute the stations in a high definition format. But Bell TV and Shaw Direct argue that a modification of the policy at this stage is premature and unwarranted. “Moreover there is no evidence to suggest that the SMITS' concerns that their services will be dropped by DTH have any foundation,” Bell TV states in its Oct. 13 intervention, noting that it already carries 13 of these stations. Bell TV notes that it has enacted business plans and contingencies based on PN 2008-100. A modification will put all these plans in jeopardy, Bell TV argues. Shaw Direct echoes the same concern, stressing that a review will negatively affect plans to invest in a $200-million construction of a new extended Ku-band satellite to compensate for the lack of space on the Anik F1 and F2 satellites. “This planned investment is critical to Shaw Direct’s ability to meet the increased DTH carriage requirements for over-the-air services set out in BPN 2008-100 (which requires the distribution of 5 SMITS), as well as market demand for high-definition services,” Shaw states in its filing. As well, Bell TV notes that a modification of the yet-to-be-enforced policy will undermine future negotiations between broadcast distribution undertakings and broadcasters on fees regarding signal distribution. As an example, Bell TV says it currently distributes two Corus stations in Peterborough and Kingston, Ont., not because of CRTC policy requirements, but through an amicable understanding between both companies. The company notes that one-one negotiations with some broadcasters resulted in Bell TV protecting them from competition from out-of-market signals. Rogers Communications Inc. and Canwest Television Ltd say they support the seven licencees in their bid to have the rules changed. Rogers notes that currently, cable companies are required to carry all local over-the-air stations in their basic packages, adding that the requirement also applies to TV stations operating in the official languages and ethnic language stations. “As a result, DTH providers should not only be required to carry all of the SMITS but also any other local television stations that are not currently distributed, including ethnic television stations,” argues the cable giant. Rogers urged the CRTC not to exempt satellite companies from these rules, stressing that they are no longer new entrants to the market and should be bound by the same rules that apply to cablecos, otherwise DTH carriers will have an unfair competitive advantage. Canwest argues that non carriage by DTH distributors has consequences for all stations, not just SMITS. It also criticized the inadequacy of the rule allowing satellite companies to carry only one station in each province. “Unfortunately, the Commission’s one-per-province regime will not ensure such carriage where a broadcaster owns more than one station in a given province.” A total of 20 companies had submitted comments on the issue to the CRTC by the Oct. 27 deadline.

Bell TV and Shaw Direct fight new requirement to carry independent local TV stations

Broadcast | October 28, 2009

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