Pelmorex licence amendment request could prod CRTC toward policy on iTV

Pelmorex Communications Inc has filed a licence amendment in hopes of pushing the CRTC into taking regulatory oversight with regard to interactive television content. As part of the licence renewal of its specialty channels, The Weather Network (TWN) and Météomédia (MM), Pelmorex is proposing an amendment to its condition of licence for the two channels that would make interactivity an integral part of the service. The company is seeking to incorporate into its programming an interactive component that would provide digital subscribers with on-demand access to weather and weather-related information. It wants to use interactivity to allow subscribers to access text and graphical information such as weather forecasts, road conditions, air quality reports and more at the touch of a button on their remote. While senior company officials acknowledge that the amendment is not necessary to offer interactivity, they said at a June 20 public hearing before the CRTC that a number of benefits would be derived from a change in the condition of licence. Not only might it lead to the CRTC having regulatory oversight with regard to the nature of the iTV content, it might also ensure incremental revenue from interactivity is included in the revenue base upon which TWN and MM’s minimum required expenditures on Canadian programming are calculated. That would translate into increased spending on Canadian content. As well, as an integral part of the channels, the interactive components would be entitled to distribution by cablecos and satellite, subject to available channel capacity. "The most positive step the commission can make to encourage the development of interactivity in Canada is to eliminate uncertainty," Paul Temple, Pelmorex’s senior VP of corporate development, told CRTC commissioners. "Uncertainty is going to hinder, prolong and complicate the rollout of interactivity in Canada. If there are no clear rules so that people can move ahead, we are not going to have interactivity for a long time." Distributors oppose Pelmorex’s proposal, saying many technical and commercial issues related to the carriage of iTV services remain unresolved. The Canadian Cable Television Association (CCTA) and Bell ExpressVu LP point out that it is too early for the CRTC to get involved and that it would be inappropriate to establish broad precedents for iTV in the context of a licence renewal process. "We believe that the iTV market is nascent, with many technological and operational issues still to be resolved," CCTA president and CEO Janet Yale said at the hearing. "In this environment, it is important that the industry be encouraged to find commercial, market-based solutions to the issues." The CCTA is also concerned that approval of the proposed amendment would establish a precedent that any programmer wishing to explore iTV opportunities with distributors would first have to obtain explicit prior approval from the CRTC. In addition, according to the CCTA, it would represent a departure from the commission’s digital licensing framework, which encourages programmers to explore iTV initiatives without the need for authorization of each and every proposal. It’s unlikely that the CRTC will abandon its current wait-and-see approach to interactivity in the context of Pelmorex’s proposal. In guidelines for the launch of new digital specialty channels that were recently released (PN 2001-57), the commission noted it was too early to develop principles specific to interactivity (CCR, June 7/01). The regulator is undoubtedly concerned that approval of the Pelmorex proposal would result in a flood of similar applications from other programmers. Another concern with the provision of iTV services is the bandwidth that is required. Pelmorex says its bandwidth requirements will be minimal in the early stages of its iTV program. However, the CRTC appears reluctant to move ahead until it has a clear understanding of bandwidth requirements for future iTV applications. But Pelmorex insists that it wants to get started earlier, rather than later, on interactivity. It is calling on the CRTC to set the rules of the game for iTV before commercial negotiations affect the regulator’s ability to set policies on interactivity. "If we kind of drift into (interactivity), precedents will be set," said Temple. "If the rules are not clear and straightforward, people are moving ahead, precedents will be set, services will be launched. Then when it comes time to sort out the rules, the commission’s ability to implement good policy could very well be compromised." Therefore, Pelmorex wants the commission to place a moratorium on the provision of licensed and unlicensed alphanumeric iTV services by distributors, if it disapproves of the licence amendment or defers it to a separate proceeding on iTV. CAB wants iTV hearing The Canadian Association of Broadcasters (CAB) is expected to shortly formally ask the CRTC to hold a separate public proceeding on iTV, perhaps as early as this fall. The CCTA supports such a proceeding, provided that it is a fact-finding one rather than one aimed at policy or rule-making. Policy wise, the CCTA has called on the CRTC to adopt a hands-off approach to iTV, as it did with new media and the Internet (CCR, Nov. 23/00). Pelmorex stressed that its proposal would only require distributors to carry its iTV content if the technical capability was there to do so. The company says it is also prepared to work with distributors to deliver that content to whatever iTV platform is selected. Regardless of what the CRTC decides on the proposed licence amendment, Pelmorex officials have indicated that they will try to negotiate carriage of its iTV content.

Pelmorex licence amendment request could prod CRTC toward policy on iTV

Broadcast | July 4, 2001

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