CAB gives “qualified support” to cablecos’ request on local avails

The Canadian Association of Broadcasters (CAB) is giving "qualified support" to Rogers Cable Communications Inc.’s and Shaw Communications Inc.’s requests to use the 25% portion of local avails – currently used to promote discretionary programming services and packages, customer service information, channel realignments, cable FM service and additional cable outlet – to promote non-programming services. Below is an excerpt from the CAB’s submission to the CRTC. Notwithstanding this potential loss of advertising revenue by its members, the CAB does not oppose, in principle, providing a reasonable degree of flexibility to broadcasting distribution undertakings (BDUs) to promote their Internet and telephony services. The CAB believes, however, that such flexibility should not detract from the willingness and the ability of those BDUs to meet their ongoing obligations respecting the promotion of Canadian programming services within the local avails. Accordingly, the CAB is prepared to offer qualified support for the Rogers and Shaw applications, provided that the following matters are satisfactorily addressed.The CAB submits that the language of the condition of licence authorizing the use of local avails should be crafted so as to authorize Rogers and Shaw to promote only their own Internet and telephony non-programming services, not non-programming services in general and not non-programming services provided by affiliated companies or by other BDUs. The CAB believes that the commission should ensure that reasonable opportunities continue to be available for the promotion of discretionary programming services and packages within the 25% portion of the local avails. Specifically, the CAB suggests that an equal split in the time devoted to the promotion of a BDU’s Internet and telephony services on the one hand, and its programming related services on the other hand, would represent an appropriate balance within the 25% of the local avails used for that purpose. In its 1999 TV policy, the commission stated that "…BDUs may not charge Canadian programming services an amount in excess of their share of the direct costs associated with the insertion of promotional material in the local availabilities of foreign satellite services. This approach was confirmed most recently in the proceeding respecting the promotion of section 9(1)(h) services. The CAB submits that granting flexibility to Rogers and Shaw to advertise their Internet and telephony services with the 25% portion of the local avails provides an appropriate opportunity for the commission to clarify this policy, so that charges for the use of the local avails are in fact consistent with its intentions. The CAB notes that the rates charged by Rogers and Shaw for the use of the local avails vary from market to market. If the rate cards were based solely on each user’s share of the direct costs associated with the use of the local avails, a flatter rate structure from system to system would be expected. Instead, it appears that Rogers and Shaw base their rates on factors such as market size and viewership raising questions as to whether the rates are consistent with the commission’s policy.

CAB gives “qualified support” to cablecos’ request on local avails

Broadcast | January 12, 2006

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