ExpressVu unfairly singled out, TV piracy an industry-wide concern: Bell president

Bell Canada president and COO John Sheridan says the broadcasting industry should stand united in its fight against television signal piracy rather than singling out Bell’s satellite TV unit. The comments come in the wake of recent media reports questioning the security of Bell ExpressVu LP’s encryption system. "Piracy is…something that we need tighter leadership on within the industry. It’s an industry-wide problem of very major proportions. But what is widely misunderstood … is that piracy is equated in many cases with the ExpressVu signal," Sheridan said November 28 at a conference hosted by the Canadian Chapter of the International Institute of Communications (IIC). During a heated panel discussion entitled The Challenges and Opportunities Facing Infrastructure Providers, he resorted to proclaiming that cable systems are also not secure. "When you look at piracy in Canada, the cable sector is leaking more money out of the system than Bell ExpressVu signals. Add onto that the U.S. signals – the black and grey market – is a very large number; it’s a bigger part of the problem. The only way to tackle those problems is on an industry leadership basis. It’s not fingering one player," he added. Cable operators have called on the CRTC to hold on "an urgent basis" a hearing to examine breaches in Bell ExpressVu’s encryption system (CCR Update, Nov. 28/02). Bell ExpressVu footed the legal bills for the case that went to the Supreme Court of Canada, which confirmed that both the black and grey markets were illegal under the Radiocommunication Act (CCR Update, April 26/02). In that case, however, Bell ExpressVu was concerned about the pirating of signals from U.S. satellite TV distributors such as DirecTV in the Canadian market. The cable industry, however, charges that many Canadian viewers are also pirating Bell ExpressVu signals without paying a fee to the distributor, or by subscribing to the basic service and illegally obtaining more costly discretionary packages of channels. Cable operators contend that the piracy of Bell ExpressVu signals is particularly a problem in the Quebec market, where viewers want the French-language channels that are not offered by U.S. satellite TV distributors. Louis Audet, president and CEO of Cogeco Cable Inc., says that cablecos have spent millions of dollars securing their systems, and that Bell ExpressVu should follow suit. He tells Canadian Communications Reports that cable companies do annual checks, including such unsophisticated initiatives as walking around cabled areas and checking who is accessing their lines. "It’s a regular feature of cable companies. You have to police your system to make sure no one is stealing it. All cablecos do this; they hire people to physically go through their systems," he says. "I’m advocating that Bell ExpressVu has to do (something similar) to maintain the integrity of its system. It’s not going to happen by chance." He suggests that direct-to-home (DTH) satellite TV distributors start managing their inventory, and ensure that boxes aren’t sold without a subscription. The request for a hearing into Bell ExpressVu’s encryption system that was filed on October 28 by the Canadian Cable Television Association does not mention its rival satellite TV distributor Star Choice Television Network Inc., which is owned by cable operator Shaw Communications Inc. Shaw CEO Jim Shaw tells CCR that’s because Star Choice has a much more secure system. "Star Choice has a different form of encryption that hasn’t been broken," he says. "The cable box hasn’t been defeated, neither has the Star Choice box. So the cable box is okay and so is the Star Choice box. The Bell ExpressVu and DirecTV boxes have been defeated." Bell ExpressVu has indicated that it is taking "numerous actions" to combat the black and grey markets. "These include aggressively pursuing court actions, conducting investigations, implementing electronic counter-measures and leading targeted information campaigns," Bell ExpressVu parent BCE Inc. noted in an investor briefing accompanying its most recent quarterly financial report. It also stated that it uses technical counter-measures to detect and shut down illegal use of its systems, and that the number of electronic counter-measures performed is growing each year. Luc Perreault, chair of the Canadian Association of Broadcasters’ committee on piracy, agrees that both DTH operators do have a problem with inventory control that threatens the integrity of their systems. "You don’t sell a cell phone and give it away unless you’ve sold them so much air time a month, or set up an account. It’s the same for cable TV products. Both Bell ExpressVu and Star Choice sell set-top boxes without signing on a subscriber." But Perreault isn’t sure that pushing the CRTC for a public hearing on the security of Bell ExpressVu’s system is the best approach. He favours the approach advocated by CRTC chair Charles Dalfen."It’s an industry-wide problem, and Dalfen is bang on," Perreault tells CCR. "We’ll need the power of all the major players to resolve the (piracy) issue." CRTC sources tell CCR that a public hearing into Bell ExpressVu’s encryption system is not a priority of the regulator. Dalfen is apparently in favour of a negotiated settlement on the matter. In a speech November 27 at the IIC conference, Dalfen indicated he was going to ask "key players in the distribution business" to meet with him in the coming weeks "to review the situation and explore potential courses of action."

ExpressVu unfairly singled out, TV piracy an industry-wide concern: Bell president

Broadcast | December 5, 2002

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