Cable alliance using CRTC staff to mediate carriage dispute with Bell

The Canadian Cable Systems Alliance (CCSA) says it has asked the CRTC to step in to help solve a carriage dispute with BCE Inc. subsidiary Bell Media Inc. Chris Edwards, the CCSA’s vice-president of corporate and regulatory affairs, said the organization is using the CRTC’s “staff-assisted mediation” process to solve the dispute, which focuses on the terms that the CCSA’s more-than 100 members would commit to in the carriage of Bell’s 30 specialty channels. “I can confirm that we are involved in staff-assisted mediation with the CRTC,” Edwards said, whose organization represents small television distributors. “ everybody’s very tightly bound by confidentiality agreements. That’s an inherent part of the CRTC mediation process.” The Wire Report reported in October that the CRTC's new vertical integration policy is slowing down Bell's carriage renewal negotiations with some broadcast distributors, including Telus Communications Co. and Cogeco Cable Inc., as those carriers consider the commission’s new dispute resolution process for better carriage deals. Bell wrote a letter to the CRTC in October complaining that the new policy is having an impact on the talks. The company has been in negotiations for several months to renew carriage agreements that expired Dec. 31, 2010. The new carriage agreements will apply retroactively to that date. Edwards said CCSA filed an initial request for mediation with the commission in late August but said the mediation process has since changed due to the commission’s Sept. 21 decision related to vertically integrated broadcasters. Telus has also asked the CRTC for assistance. In a Dec. 9 letter to Telus, the CRTC noted that the company is seeking “the intervention of the Commission to help resolve commercial issues with Bell Media, related to gaining access to certain specialty services.” The letter said Telus has not yet “properly put its dispute before” the CRTC and that its options involve filing an application alleging that Bell has acted with “undue preference” or file for binding arbitration with the commission. The vertical integration ruling had a new code of conduct appended to it, governing commercial carriage agreements between broadcasters and television distributors. The code of conduct says television distributors should not require “an “unreasonable” carriage rate from broadcasters or one that is not “based on fair market value”; refuse to make channels available “on a stand-alone basis”; demand an “excessive activation fee or minimum subscription guarantee,” among other objectives. “While it remains of the view that such matters are generally best determined by negotiations between the parties without its intervention, there may be circumstances where the Commission determines that it must intervene in the public interest,” the CRTC says in its introduction to the code. At the International Institute of Communications conference in Ottawa last month, CRTC chair Konrad von Finckenstein said the new code of conduct “ensures that distributors, broadcasters and online programming services negotiate in good faith. The code sets out the standards they will be judged by when there are complaints of undue preference.” Edwards suggested the CRTC's new guidelines are likely to impact the mediation process. “Logic would tell you that it would,” he said. The vertical integration decision also imposed “standstill” requirements that ensure a broadcaster cannot pull its channels from a cable, satellite, or IPTV broadcast distributor and that “both parties are to provide continued access to programming services and carriage” while the issue is before the commission. The commission intends to launch a new regulatory proceeding to determine how the standstill rule will work. In a letter to the CCSA on Dec. 9, the commission said that in the meantime it “can (and in the appropriate case has) ordered a standstill until the dispute is resolved.” Edwards said it is important for the CCSA's members to secure the rights to carry the channels, which include the popular sports channels TSN. “There’s 29 or 30 services involved here, most of which Canadian customers see now, and the importance is the continued ability to carry those services and deliver them to Canadians.” The carriage rates for TSN are expected to rise significantly, to as high as $4 or $5 per subscriber, as carriage deals are renewed. Telus spokesman Jim Johannsson said in an email that the company has not yet secured a carriage renewal deal for Bell’s channels but declined to comment further. “I can confirm for you that we have not yet signed a deal with Bell but we can’t offer any additional detail at this time,” Johannsson wrote. Edwards declined to comment on whether the CCSA and its members face similar disputes with other broadcasters. René Guimond, vice-president of public affairs and communications at Cogeco, told The Wire Report in October that it is making its best efforts to negotiate an agreement "without resorting to CRTC arbitration” but that “if the terms and conditions appear to be unreasonable, we will not hesitate to take the dispute to the CRTC.” Shaw Communications Inc. announced an agreement in October to carry Bell's 30 specialty services. Rogers did not respond by deadline to a question about its negotiations with Bell. Bell declined to comment, but in a statement in October, spokeswoman Jacqueline Michelis acknowledged that the vertical integration decision affected negotiations with “several” distributors including Telus and Cogeco. Michelis said prior to the decision Bell Media had reached carriage agreements with more than 140 broadcast distributors. news@thewirereport.ca

Cable alliance using CRTC staff to mediate carriage dispute with Bell

Broadcast | December 9, 2011

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