CRTC S.9(1)(h) etc. Hearing

That’s what I’m calling this hearing for now. It’s a grab bag of renewals of mandatory carriage, applications for existing services to get mandatory carriage, new services to get mandatory carriage and a few independent specialty services to get renewal.  The full hearing notice is here.  All 13,018 interventions are here (though most have to do with wanting or not wanting Sun News Network).  Warning – this post is pretty wonky!

First – what exactly is mandatory carriage?  Under s. 9(1)(h) of the Broadcasting Act, the CRTC can require a satellite or cable company to carry a service, rather than leave it to the service to negotiate carriage.  If a service has mandatory carriage then its revenue stream and its audience is certain.  A service has to make an exceptional contribution to Canadian expression, contribute in an exception manner to the overall objectives of the Broadcasting Act and make exceptional commitments to original, first-run Canadian programming.  As mandatory carriage adds to the basic cable or satellite package and therefore increases the cost of those packages to consumers, there has traditionally been a very close review of that ‘exceptionality’ and few services have passed the test.  Examples of existing s.9(1)(h) services in English are CPAC, The Weather Network, APTN and CBC News Network.

The industry intervenors on this public hearing (submission deadline was February 27, 2013) are lining up on two sides of the mandatory carriage issue.  The cable and satellite companies do not want to add any new services to the basic package.  They are arguing against increased costs to consumers.  Generally cable and satellite companies argue from a place of great self-interest but in this I suspect that they are also reflecting the general mood of the marketplace.  Telus filed a public opinion study by Strategic Counsel that demonstrates a distinct lack of interest in increasing the basic package.  Our cable bills are high.  Consumers have a great reluctance to increase them at all for anything.

Generally, the English content creators (i.e. producers, talent unions) are only weighing in on the services which broadcast or might broadcast independently produced drama and documentaries:  Vision TV, APTN and the proposed new service Starlight.  There are a few concerns which some of the stakeholders would like to see addressed at the hearing but in general the content creators would like to see Vision TV given mandatory carriage, APTN get its increased rate and the new service Starlight launch with mandatory carriage.   All three services will support the independent production community in Canada and this is important.  Starlight is proposing a new solution to the problem of underfinanced and underbroadcast Canadian feature film.

The issue that the CRTC will have to grapple with is whether the support that each of these services provide to the independent production community, and the programming that they offer to Canadians, is exceptional enough to require Canadians to pay more to their cable company.  While the media is going to be most interested in the kerfuffle that is Sun News Media’s request for mandatory carriage, the Canadian independent production community will be more interested in the Starlight application.  As a new service aimed at solving a problem that the CRTC has itself identified – Canadians do not have enough access to Canadian feature films – has Starlight met the test necessary to require Canadians to pay for it?  I anticipate an interesting discussion.

But let’s not forget the independent specialty service renewals.  The CMPA has pointed out that a number of these services have asked for relief from their Canadian programming obligations (CPE) on the basis that the 2010 Group Licence Policy granted a reduction in CPE for the large corporate groups but contrary to that policy’s explicit statement that the policy would not apply to independent specialty services.   That policy balanced greater flexibility to broadcast group with specific obligations to Canadian programming and PNI.  It is very difficult to apply it to an individual service.

It also appears to be sliding under most people’s radar that Blue Ant (Travel + Escape, Bold, Bite, Aux and more) is asking to be treated as a group for the purposes of its CPE obligations and to be able to count in-house production for the purposes of calculating its obligations to independent production.  That last bit is pretty nervy and I’m confident that the CMPA is all over it.  So let’s go back to the concept of a ‘group’ under the 2010 Group Licence Policy.  The concept of Broadcast Groups was created to allow groups to air programs across their various services and count them towards a pooled obligation.  Bell could decide to air a program on CTV, CTV2 and/or Space in any order.  This regulatory framework was consistent with how the large corporate groups were licensing programming.  But does it make sense for a much smaller group of services, some of which are quite different from each other?   That will be the discussion.

The Public Hearing on these applications will start April 23, 2013. I’m experimenting with the hashtag #91hetc.  What do you think?

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5 thoughts on “CRTC S.9(1)(h) etc. Hearing

  1. Pingback: Following the CRTC’s mandatory carriage hearings – Fagstein

  2. Pingback: CRTC S.9(1)(h) Hearing (Mandatory Carriage) Decision | Butter Tarts and Brown Drinks

  3. Pingback: A Hodge Podge of CRTC Decisions (Independent Licence Renewals) | Butter Tarts and Brown Drinks

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