CRTC dismisses Bell’s complaint against Rogers’ hockey app

The CRTC has dismissed a complaint by BCE Inc. against Rogers Communications Inc.’s GamePlus service, ruling that Rogers could offer the NHL hockey app exclusively to its own customers because the content wasn’t produced primarily for traditional television. The regulator said in the decision that the CRTC “encourages innovation in programming and considers that the way that Rogers offers GamePlus complies with the Digital Media Exemption Order.” Rogers launched GamePlus last fall as a second-screen app that gives customers access to extra camera angles and additional content including interviews and analysis. It is available only to customers who subscribe to Rogers’ NHL GameCentre Live streaming service, which was announced in September, and also have Rogers' cable, Internet, wireless or home-phone service. Bell filed a challenge against the service later that month, arguing that because GamePlus content, such as the extra camera angles and analysis segments, is produced by Rogers employees, "the same team operating the same equipment at the same time in the same place as the programming broadcast by Rogers,” it is technically television programming and can’t, under CRTC rules, be exclusive. Rogers responded that Bell's application is simply an attempt to "hinder" efforts to provide customers with innovative products. In its decision Monday, the CRTC said the issue at the centre of the complaint was whether GamePlus fulfills the definition of television programming in the digital media exemption order. The CRTC said that it “considers that GamePlus is different from a linear broadcast of a game in that it provides users with control over how they view a hockey game,” allowing users to select certain camera angles, to replay content and watch the programming made for the app, such as analysis and interviews, “at their convenience.” “As a result, GamePlus offers an experience that is tailored by the viewer,” the CRTC said. It added that GamePlus content was also complementary to the traditional broadcast, noting that “subscribers can watch the live action on their television sets while, at the same time, following specific aspects of the game or viewing replays of particular plays on a second screen.” The CRTC also noted that if “GamePlus programming were created primarily for linear television, the Commission considers that Rogers would have allowed this programming to be used much more extensively in its regular NHL broadcasts.” In a press release Monday, Rogers Media president Keith Pelley said the company applauded the CRTC’s decision and that Rogers customers “are using their mobile devices more than ever, which is why GamePlus is such a great add-on to watching the traditional game broadcast.” He added that Rogers “won’t stop giving fans new ways to watch hockey and we won’t stop looking for other innovative ways to deliver programming.” Bell did not respond to a request for comment. Canaccord Genuity analyst Dvai Ghose said in an email that he was “somewhat surprised given the CRTC's dislike of vertical integration and exclusivity,” though he noted that “given the complaint came from Bell, the CRTC may have been less sympathetic than if it came from a non vertically integrated carrier like Telus , Cogeco or MTS.” Telus did support Bell’s complaint. “The problem for the CRTC is that broadband wireline and wireless may become the dominant platform for video access over time and so their rules may have to be amended over time to stay consistent,” Ghose said. He added that there is “no evidence that the app is helping Rogers connectivity business at this time as shown by the net contraction in Rogers postpaid wireless and wireline broadband subscriber bases” in the fourth quarter of 2014, compared to the strong growth Bell and Telus Corp saw in those segments. He added that suggests “at least for now, that the Rogers app and exclusivity are not particularly material.” Brian Schecter, a media consultant with Puddle Duck Productions in Vancouver, said in a phone interview that he’s not “terribly surprised they would side with Rogers.” He noted that Bell lost out to Rogers in the latest NHL rights deal, “and they’re now trying to figure out other ways they can get back into the hockey game, even if it’s not specifically broadcasting. And the CRTC said no, good try guys, but I don’t think it’s going to work.” Gord Hendren, president of Charlton Strategic Research, said in a phone interview that if owners of sports properties, which in Canada is mainly Rogers and Bell, “can create innovative new products that are available only online as an enhancement, than that’s a value-add for their customers. Rogers will do it with NHL content, and Bell will look at what content they have and look at what enhancements they can do.” We could see more similar products on the market, he added. In a phone interview, Troy Crandall, a telecom analyst with 3Macs, said “the whole point of the rule was to drive innovation, and I think that’s what we’ve got, so why would they push back on that?” He said the “CRTC made the right decision. I think they made the expected decision, in fact. No foul to Bell for giving it a try to block it.” If the CRTC had ruled in favour of Bell, they “might have discouraged innovation.” By dismissing the complaint, the CRTC is “showing they stand behind the rules they set forth a few years ago.” He said this was the “first test” for those rules, “and I think it went the way people in general probably expected it to go … it seemed like a fairly clear rule, and now it’s been tested, and it now seems maybe even more clear.” Emily Taylor, an analyst with International Data Corp., said in a phone interview that the CRTC’s decision ties back to “the idea of what is content, which is a hard thing to define.” She said the CRTC will likely have to deal with such questions on a case-by-case basis, “as this very complex market nets out over the next, say, five years. It’s changing so quickly.” — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Peter Henderson at phenderson@thewirereport.ca

CRTC dismisses Bell’s complaint against Rogers’ hockey app

News | 03/16/2015 8:32 pm EDT

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