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CRTC tweaks TV system, helps consumers as regulator rejects extra cable charges

GATINEAU, Que. — Canada’s broadcasting regulator has introduced changes to give Canadians greater TV viewing choices while rejecting a controversial demand that would have seen monthly cable TV bills increase.

The Canadian Radio-television and Telecommunications Commission’s much-awaited review, released Thursday, was expected to be a wholesale makeover of the industry that many see as overregulated and under severe economic strains.

Instead, Canadians got a minor makeover that will allow for greater competition, more but still restricted viewer choices, and only impacts the economics of the industry on the margins.

And most of the changes won’t take effect until Aug. 31, 2011, when the broadcasting system switches over to digital.

“We have restructured the framework, we have tried to simplify it, we have tried to make it more competitive,” said commission chairman Konrad von Finckenstein.

“It’s up to them (industry) now to take advantage of it and produce something Canadians want to watch.”

The federal regulator’s vision of Canadian television in the future would allow cable and satellite operators to provide a wider menu of conventional and specialty channels, as long as the entire package is at least 51 per cent Canadian content.

Still, the regulator has kept genre protection largely in place, meaning Canada’s specialty channels won’t have to worry about being pushed out by bigger U.S. rivals, such as ESPN, or Showtime or MTV, or the U.S. Food Channel.

For instance, von Finckenstein said cable and satellite distributors no longer will have any regulatory reason to bundle services to customers.

Customers could be given the ability to choose the package of channels they pay for, as long as more than 50 per cent are Canadian content.

The regulator has also opened the door for the creation of a third national cable news or sports station in competition with the existing CBC Newsworld and CTV Newsnet, as well as TSN and Sportsnet.

Specialty channels also have greater flexibility in the programming they can offer and not break their licensing conditions. For instance, TSN will be allowed to offer sports movies in up to 10 per cent of its broadcast schedule.

Media analyst Michael Geist, a professor with the University of Ottawa, called the CRTC’s actions “tinkering” with the system.

“Broadcasting will look different in 2011, but not because of this decision. The rush of technology and the emergence of the Internet and wireless are fundamentally altering the landscape” leaving the CRTC an increasingly marginalized player, he said.

But the decision that will frustrate conventional broadcasters such as CTV, Global and CBC – and please consumers – was the regulator’s rejection of their request to charge cable and satellite distributors for carrying their channels.

The fee-for-carriage charge would have added anywhere from $2 to $10 to a subscriber’s monthly bill, if passed through, and brought in an estimated $300 million in revenues to the broadcasters.

The federal regulator said conventional networks such as CTV, Global and CBC failed to prove they have enough economic need for the higher revenues.

The CRTC gave the broadcasters a consolation prize, however, saying they can negotiate with the distributors for so-called “distant signals,” something that could net $70-$90 million in revenues.

Distance signals allows a viewer in one region of the country to watch a show in a different region that is airing the program in a different time zone.

Broadcasters appeared to reserve their judgment immediately following the CRTC decision, reacting with neutral language.

“This is a complex decision. A lot of effort and time has gone into this process. We will study it accordingly,” said Paul Sparkes, executive vice-president of CTVglobemedia, in an email response.

However, the Public Interest Advocacy Centre said the regulator’s ruling ignored consumers, which have already been hurt by deregulation of the industry.

“Cable fees have risen beyond the rate of inflation and the commission seems only concerned with the lack of competition between distribution undertakings for acquiring broadcasting rights”, said Michael Janigan, general counsel and executive director of the Ottawa-based consumer rights group.

“Who is looking out for the interests of the ordinary consumer of television services who despite the billions earned by cable and satellite companies, can’t be guaranteed a basic package of television services for a reasonable price.”

The regulator has also said cable and satellite companies will need to contribute $60 million to create a fund that will go into local news programming in markets of less than one million.

The contribution works out to about 50 cents a subscriber for the distributors, and the CRTC said there is no reason companies such as Rogers Cable, Shaw Cable or BellExpressVu should not be able to absorb the extra costs.

However, Geist said it was more likely the distributors will pass on the charges to consumers, which would amount to about $6 a year.

The cable and satellite TV distributors were also given new revenue streams. The CRTC is allowing them to collect advertising for video-on-demand and introduce ads targeted to specific communities, something new digital technology makes possible.

As well, the new rules gives distributors greater freedom to package the channels they can offer customers.

Von Finckenstein said the changes do not give every part of the industry all it asked, but no part walks away with no gains from the process.

Ian Morrison of Friends of Canadian Broadcasting praised the CRTC for balancing the competing interests in the industry.

CRTC hearings earlier this year pitted the main broadcasters against the cable TV operators in the battle over the proposed extra fees. Others called for a more open broadcast environment with less regulation to deal with added competition and new market opportunities created by Internet communications and broadcasting.

“The desire for better local programming in Canada’s smaller markets was clearly made evident during this proceeding,” von Finckenstein said in a statement. “We have taken concrete steps to make sure that viewers in these markets continue to benefit from a diversity of local programming.”

Source: The Canadian Press

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Your email address will not be published. Required fields are marked *

Front Page, Industry News

CRTC tweaks TV system, helps consumers as regulator rejects extra cable charges

GATINEAU, Que. — Canada’s broadcasting regulator has introduced changes to give Canadians greater TV viewing choices while rejecting a controversial demand that would have seen monthly cable TV bills increase.

The Canadian Radio-television and Telecommunications Commission’s much-awaited review, released Thursday, was expected to be a wholesale makeover of the industry that many see as overregulated and under severe economic strains.

Instead, Canadians got a minor makeover that will allow for greater competition, more but still restricted viewer choices, and only impacts the economics of the industry on the margins.

And most of the changes won’t take effect until Aug. 31, 2011, when the broadcasting system switches over to digital.

“We have restructured the framework, we have tried to simplify it, we have tried to make it more competitive,” said commission chairman Konrad von Finckenstein.

“It’s up to them (industry) now to take advantage of it and produce something Canadians want to watch.”

The federal regulator’s vision of Canadian television in the future would allow cable and satellite operators to provide a wider menu of conventional and specialty channels, as long as the entire package is at least 51 per cent Canadian content.

Still, the regulator has kept genre protection largely in place, meaning Canada’s specialty channels won’t have to worry about being pushed out by bigger U.S. rivals, such as ESPN, or Showtime or MTV, or the U.S. Food Channel.

For instance, von Finckenstein said cable and satellite distributors no longer will have any regulatory reason to bundle services to customers.

Customers could be given the ability to choose the package of channels they pay for, as long as more than 50 per cent are Canadian content.

The regulator has also opened the door for the creation of a third national cable news or sports station in competition with the existing CBC Newsworld and CTV Newsnet, as well as TSN and Sportsnet.

Specialty channels also have greater flexibility in the programming they can offer and not break their licensing conditions. For instance, TSN will be allowed to offer sports movies in up to 10 per cent of its broadcast schedule.

Media analyst Michael Geist, a professor with the University of Ottawa, called the CRTC’s actions “tinkering” with the system.

“Broadcasting will look different in 2011, but not because of this decision. The rush of technology and the emergence of the Internet and wireless are fundamentally altering the landscape” leaving the CRTC an increasingly marginalized player, he said.

But the decision that will frustrate conventional broadcasters such as CTV, Global and CBC – and please consumers – was the regulator’s rejection of their request to charge cable and satellite distributors for carrying their channels.

The fee-for-carriage charge would have added anywhere from $2 to $10 to a subscriber’s monthly bill, if passed through, and brought in an estimated $300 million in revenues to the broadcasters.

The federal regulator said conventional networks such as CTV, Global and CBC failed to prove they have enough economic need for the higher revenues.

The CRTC gave the broadcasters a consolation prize, however, saying they can negotiate with the distributors for so-called “distant signals,” something that could net $70-$90 million in revenues.

Distance signals allows a viewer in one region of the country to watch a show in a different region that is airing the program in a different time zone.

Broadcasters appeared to reserve their judgment immediately following the CRTC decision, reacting with neutral language.

“This is a complex decision. A lot of effort and time has gone into this process. We will study it accordingly,” said Paul Sparkes, executive vice-president of CTVglobemedia, in an email response.

However, the Public Interest Advocacy Centre said the regulator’s ruling ignored consumers, which have already been hurt by deregulation of the industry.

“Cable fees have risen beyond the rate of inflation and the commission seems only concerned with the lack of competition between distribution undertakings for acquiring broadcasting rights”, said Michael Janigan, general counsel and executive director of the Ottawa-based consumer rights group.

“Who is looking out for the interests of the ordinary consumer of television services who despite the billions earned by cable and satellite companies, can’t be guaranteed a basic package of television services for a reasonable price.”

The regulator has also said cable and satellite companies will need to contribute $60 million to create a fund that will go into local news programming in markets of less than one million.

The contribution works out to about 50 cents a subscriber for the distributors, and the CRTC said there is no reason companies such as Rogers Cable, Shaw Cable or BellExpressVu should not be able to absorb the extra costs.

However, Geist said it was more likely the distributors will pass on the charges to consumers, which would amount to about $6 a year.

The cable and satellite TV distributors were also given new revenue streams. The CRTC is allowing them to collect advertising for video-on-demand and introduce ads targeted to specific communities, something new digital technology makes possible.

As well, the new rules gives distributors greater freedom to package the channels they can offer customers.

Von Finckenstein said the changes do not give every part of the industry all it asked, but no part walks away with no gains from the process.

Ian Morrison of Friends of Canadian Broadcasting praised the CRTC for balancing the competing interests in the industry.

CRTC hearings earlier this year pitted the main broadcasters against the cable TV operators in the battle over the proposed extra fees. Others called for a more open broadcast environment with less regulation to deal with added competition and new market opportunities created by Internet communications and broadcasting.

“The desire for better local programming in Canada’s smaller markets was clearly made evident during this proceeding,” von Finckenstein said in a statement. “We have taken concrete steps to make sure that viewers in these markets continue to benefit from a diversity of local programming.”

Source: The Canadian Press

Leave a Reply

Your email address will not be published. Required fields are marked *

Front Page, Industry News

CRTC tweaks TV system, helps consumers as regulator rejects extra cable charges

GATINEAU, Que. — Canada’s broadcasting regulator has introduced changes to give Canadians greater TV viewing choices while rejecting a controversial demand that would have seen monthly cable TV bills increase.

The Canadian Radio-television and Telecommunications Commission’s much-awaited review, released Thursday, was expected to be a wholesale makeover of the industry that many see as overregulated and under severe economic strains.

Instead, Canadians got a minor makeover that will allow for greater competition, more but still restricted viewer choices, and only impacts the economics of the industry on the margins.

And most of the changes won’t take effect until Aug. 31, 2011, when the broadcasting system switches over to digital.

“We have restructured the framework, we have tried to simplify it, we have tried to make it more competitive,” said commission chairman Konrad von Finckenstein.

“It’s up to them (industry) now to take advantage of it and produce something Canadians want to watch.”

The federal regulator’s vision of Canadian television in the future would allow cable and satellite operators to provide a wider menu of conventional and specialty channels, as long as the entire package is at least 51 per cent Canadian content.

Still, the regulator has kept genre protection largely in place, meaning Canada’s specialty channels won’t have to worry about being pushed out by bigger U.S. rivals, such as ESPN, or Showtime or MTV, or the U.S. Food Channel.

For instance, von Finckenstein said cable and satellite distributors no longer will have any regulatory reason to bundle services to customers.

Customers could be given the ability to choose the package of channels they pay for, as long as more than 50 per cent are Canadian content.

The regulator has also opened the door for the creation of a third national cable news or sports station in competition with the existing CBC Newsworld and CTV Newsnet, as well as TSN and Sportsnet.

Specialty channels also have greater flexibility in the programming they can offer and not break their licensing conditions. For instance, TSN will be allowed to offer sports movies in up to 10 per cent of its broadcast schedule.

Media analyst Michael Geist, a professor with the University of Ottawa, called the CRTC’s actions “tinkering” with the system.

“Broadcasting will look different in 2011, but not because of this decision. The rush of technology and the emergence of the Internet and wireless are fundamentally altering the landscape” leaving the CRTC an increasingly marginalized player, he said.

But the decision that will frustrate conventional broadcasters such as CTV, Global and CBC – and please consumers – was the regulator’s rejection of their request to charge cable and satellite distributors for carrying their channels.

The fee-for-carriage charge would have added anywhere from $2 to $10 to a subscriber’s monthly bill, if passed through, and brought in an estimated $300 million in revenues to the broadcasters.

The federal regulator said conventional networks such as CTV, Global and CBC failed to prove they have enough economic need for the higher revenues.

The CRTC gave the broadcasters a consolation prize, however, saying they can negotiate with the distributors for so-called “distant signals,” something that could net $70-$90 million in revenues.

Distance signals allows a viewer in one region of the country to watch a show in a different region that is airing the program in a different time zone.

Broadcasters appeared to reserve their judgment immediately following the CRTC decision, reacting with neutral language.

“This is a complex decision. A lot of effort and time has gone into this process. We will study it accordingly,” said Paul Sparkes, executive vice-president of CTVglobemedia, in an email response.

However, the Public Interest Advocacy Centre said the regulator’s ruling ignored consumers, which have already been hurt by deregulation of the industry.

“Cable fees have risen beyond the rate of inflation and the commission seems only concerned with the lack of competition between distribution undertakings for acquiring broadcasting rights”, said Michael Janigan, general counsel and executive director of the Ottawa-based consumer rights group.

“Who is looking out for the interests of the ordinary consumer of television services who despite the billions earned by cable and satellite companies, can’t be guaranteed a basic package of television services for a reasonable price.”

The regulator has also said cable and satellite companies will need to contribute $60 million to create a fund that will go into local news programming in markets of less than one million.

The contribution works out to about 50 cents a subscriber for the distributors, and the CRTC said there is no reason companies such as Rogers Cable, Shaw Cable or BellExpressVu should not be able to absorb the extra costs.

However, Geist said it was more likely the distributors will pass on the charges to consumers, which would amount to about $6 a year.

The cable and satellite TV distributors were also given new revenue streams. The CRTC is allowing them to collect advertising for video-on-demand and introduce ads targeted to specific communities, something new digital technology makes possible.

As well, the new rules gives distributors greater freedom to package the channels they can offer customers.

Von Finckenstein said the changes do not give every part of the industry all it asked, but no part walks away with no gains from the process.

Ian Morrison of Friends of Canadian Broadcasting praised the CRTC for balancing the competing interests in the industry.

CRTC hearings earlier this year pitted the main broadcasters against the cable TV operators in the battle over the proposed extra fees. Others called for a more open broadcast environment with less regulation to deal with added competition and new market opportunities created by Internet communications and broadcasting.

“The desire for better local programming in Canada’s smaller markets was clearly made evident during this proceeding,” von Finckenstein said in a statement. “We have taken concrete steps to make sure that viewers in these markets continue to benefit from a diversity of local programming.”

Source: The Canadian Press

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Your email address will not be published. Required fields are marked *

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