Media, cultural groups support 9(1)(h) carriage for APTN, Starlight

Organizations that represent the Canadian television and film industry said they support some specialty channel applications for “must carry” mandatory distribution. The CRTC launched a public consultation in January on more than 20 broadcasting applications filed under section 9(1)(h) of the Broadcasting Act, which allows mandatory distribution of specialty channels by broadcast distributors “on such terms and conditions as the Commission deems appropriate.” Media and production groups are supporting a mandatory carriage application for a new specialty channel called Starlight: The Canadian Movie Channel, as well as the Aboriginal Peoples Television Network's (APTN) application to renew mandatory carriage with a 15-cent increase, bringing its wholesale carriage rate up to 40 cents per subscriber per month. The Director's Guild of Canada (DGC), The Canadian Media Guild, and the Writers Guild of Canada (WGC) said in interventions filed with the CRTC in February that it is “crucial” for APTN to increase its wholesale rate to grow and acquire new programs that are unique and cannot be seen anywhere else. The Canadian Media Guild said that APTN faces “extraordinary costs” compared to other broadcasters, such as those associated with covering remote and often inaccessible locations. Starlight has applied for mandatory distribution and a 45-cent per subscriber per month wholesale rate. The channel, owned by a group of Canadian film industry members, has named former CMPA president Norm Bolen as its CEO and will air only Canadian films. The channel argues that it needs mandatory distribution because the pay and specialty television sector does not provide enough support for the Canadian feature film industry. The Canadian Media Production Association (CMPA) and the DGC said they support Starlight's application because the channel will make a valuable contribution for the future of Canadian film. The DGC said Canadian films are “orphans” in the Canadian broadcasting system and that broadcasters are not fulfilling their requirement under Section 3(1) of the Broadcasting Act to include Canadian films in their broadcasts. “Despite clearly coming under the Act, however, Canadian broadcasters have used arguments for flexibility and against micro-management to successfully eliminate any specific regulatory commitments towards feature film,” the DGC said in its intervention. Former CRTC vice-chair of broadcasting Michel Arpin said in an interview with The Wire Report in January that, to gain 9(1)(h) carriage, broadcasters will have to demonstrate to the commission that their channel is a distinct public service and that it would not be economically viable without mandatory carriage. National broadcast distributers Rogers Communications Inc., Cogeco Cable Inc., Shaw Communications Inc., and Telus Corp. told the CRTC they oppose the 9(1)(h) applications. Telus wrote in its submission to the commission that APTN argues that its proposed wholesale rate is in keeping with the average Category A wholesale rate in Canada, though a 40-cent rate will generate revenues significantly higher than Category A “must offer” services because the channel benefits from a 100 per cent penetration guarantee. Category A services must be offered, or made available, to subscribers by distributors, while 9(1)(h) “must carry” licences mean TV subscribers receive the channel with their basic TV subscriptions. “Category 1 services lack the distribution rights that APTN has as a service with mandatory distribution, making them poor candidates for establishing a benchmark for APTN's wholesale rate,” Cogeco, Rogers and Shaw said in a joint submission. APTN reported an adjusted financial forecast that said, without the wholesale rate increase, the company would have a cumulative operating income of 77 per cent of what it would have with the rate increase. That does not make the proposed increase necessary for the channel financially, Shaw said in its submission. “APTN needs to figure out a way to live within its current financial means or improve the service it provides to subscribers so that it can enhance its advertising revenue,” Rogers added in separate comments. “It should not be permitted to continually rely on the Commission's regulatory authority to improve its financial position.” The Public Interest Advocacy Centre (PIAC), in conjunction with the Consumers’ Association of Canada (CAC), Council of Senior Citizens’ Organizations of British Columbia (COSCO), and the National Pensioners and Senior Citizens Federation (NPSCF), suggested they support APTN’s proposed price increase though they are concerned about its affects on consumers with basic cable service packages, especially seniors on low, fixed incomes. “e are sensitive to the affordability concerns of consumers and hesitate to support the entire proposed rate increase at this time,” PIAC said in the intervention related to APTN's application. Astral Media Inc. and Corus Entertainment Inc. said in a joint comment about the Starlight application that its justifications for mandatory carriage are “just plain wrong.” Corus and Astral cited BBM data to say that the number of Canadian theatrical films on Canadian broadcasting services has doubled over the past five years to 10,799 airings. Astral and Corus said they operate a number of pay television services that provide extensive Canadian film content, such as The Movie Network. “A more detailed examination of the status of Canadian films on Astral’s and Corus’ English-language general interest pay services show a deep commitment to the exhibition and promotion of Canadian feature films,” the companies said. The broadcasters said a system in which customers have the option to subscribe to specialty movie channels “gives consumers more control over the degree and cost of access that they deem appropriate.” —With reporting by Elisabetta Bianchini for The Wire Report and editing by Simon Doyle at sdoyle@thewirereport.ca

Media, cultural groups support 9(1)(h) carriage for APTN, Starlight

Broadcast | March 7, 2013

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