CCR Short Takes

ClarificationThe House of Commons Standing Committee on Canadian Heritage, which is studying the broadcasting system, had intended to go to London, England; Washington DC; and to host a three-day retreat at Meech Lake to put together its report. But the committee’s request for financing for the travel was turned down by the Budget Sub Committee on December 5. Thus, further to the article entitled "Heritage committee looking at relevance of Britain’s Communications Bill to Canada" in the Dec. 13, 2002 issue of CCR, committee members will examine the legislation in paper form only. Members will not be traveling to England to question Parliamentarians there on the British bill (CCR, Dec. 13/02). Star Choice to cancel its "Simple Satellite" programA little more than a year after launching its Simple Satellite program, satellite TV operator Star Choice Television Network Inc. plans to cancel the offering. The announcement was made in Star Choice parent Shaw Communications Inc.’s fiscal 2003 first-quarter financial report released last week. Introduced in September 2001, the program was designed to make it easier for customers to adopt satellite television (CCR, Sept. 27/01). Under the offer, Star Choice retains ownership of the satellite dish. An entry-level satellite system under the program is currently offered for $59 after programming credits. Simple Satellite customers receive free lifetime maintenance on the dish and all outside components, free basic installation by professional installers, and a free dish and installation if they move. Later in 2001, Star Choice launched a leasing option of its Simple Satellite program called No Worries Simple Satellite (CCR Update, Oct. 17/01). However, this option was quietly discontinued by Star Choice late last year. Star Choice has consistently lagged satellite TV rival Bell ExpressVu LP in subscriber growth on a quarterly basis. CanWest sells small market newspapers in southern OntarioCanWest Global Communications Corp. will sell the small market weeklies and dailies it owns in southern Ontario to Osprey Media Holdings Inc. for $193.5 million in cash. The transaction is expected to close in mid-February. Proceeds from the sale will be used to reduce CanWest’s debt. The newspapers being sold include the Brantford Expositor, St. Catharines Standard, Niagara Falls Review and The Welland Tribune along with 30 community publications and related assets. ExpressVu warns customers of fraudulent documents in Quebec CityBell ExpressVu has warned its customers that some subscribers in the Quebec City area have received fraudulent Quebec court documents that accuse them of stealing satellite television signals. The false document, which purport to have been issued by the Criminal Division of the Quebec Court, ask for more than $2,500. "I want to assure our customers that as soon as we became aware of these documents we investigated and determined that they were fraudulent and should be ignored," Bell ExpressVu president Tim McGee says in a media release. "We want to assure our customers we are pursuing this matter with the appropriate authorities and we will keep them advised." CRTC rules on VDN Cable, Vidéotron complaintsThe CRTC has ruled that Vidéotron ltée failed to provide access to its customer service enclosures (CSEs) so that competitor VDN Cable Inc. could switch over customers in the Montreal area (Broadcasting Decision 2003-24). The CRTC ruled that Vidéotron was in breach of Section 10 of the Broadcasting Distribution Regulations. But in the same ruling, the CRTC also found that VDN had failed to comply with commission policies on the ownership and integrity of the enclosures in securing access without authorization. The decision follows a complaint filed by VDN on Jan. 30, 2002 over its inability to access Vidéotron-owned CSEs, which are locked metal boxes that have to be accessed to switch change the distributor from which subscribers receive their service. VDN contended that Vidéotron had ignored about half of the requests submitted for disconnections of subscribers of the Vidéotron service. Specifically, VDN stated Vidéotron refused to perform any disconnections "after having received proper notification" in Westmount Square Residential Complex. Vidéotron acknowledged that it had not fulfilled VDN’s requests for disconnections at the complex, but alleged in a counter complaint filed on Feb. 13, 2002 that VDN had secured "unauthorized" access to its CSEs. Vidéotron said that co-operation with VDN was possible only if the integrity of its property was respected. The Quebecor-owned cableco provided a list of 46 apartments from which the inside wire had been transferred to VDN without authorization. VDN also charged that Vidéotron was directly marketing customers in the complex in violation of winback rules. But the CRTC ruled that there was insufficient evidence to find that Vidéotron was directly marketing customers who had notified them of their intention to cancel basic cable service. The commission, however, "remains concerned with Vidéotron’s practice of using inspectors to identify MUDs (multiple unit dwellings) that have become particularly vulnerable to competition." Thus, it has asked Vidéotron to submit a written report to the commission within 15 days of the January 24 ruling that sets out the measures to be taken to ensure its inspectors do not breach winback provisions. As well, Vidéotron has 15 days to report to the CRTC on the measures it has put in place to "ensure that competitive BDUs are accorded the required access to its inside wire and CSEs." The CRTC also noted, "While it appears that VDN’s action would not have occurred in the absence of Vidéotron’s own inappropriate behaviour, the commission finds that this does not justify VDN’s failure to comply with the relevant policies regarding the ownership and integrity of CSEs when it performed disconnections without authorization from Vidéotron." In another decision, the CRTC dismissed complaints by VDN that alleged that Vidéotron was targeting its customers with a package of services at a price that VDN could not possibly match in breach of Section 9 of the Broadcasting Distribution Regulations (Broadcasting Decision 2003-25). VDN argued to no avail that Vidéotron was using its larger existing client base to subsidize the price of its services. VDN’s subscriber base consists of about 7,000 subscribers in MUDs in the Montreal area. Vidéotron has more than 700,000 subscribers in the Montreal area. CTV Travel gets licence amendmentsThe CRTC has granted the digital specialty channel CTV Travel a licence amendment that will allow it to broadcast as many hours of programming as it wants from the informal education/recreation and leisure programming category (Broadcasting Decision 2003-20). Its current licence restricts that programming to 5% of all programming broadcast during each broadcast week. As well, its definition of "broadcast day" was altered to begin at midnight, instead of 6 a.m. CHUM reports increased net earnings in first quarterCHUM Ltd. announced on January 22 that net earnings for the first quarter of fiscal 2003 ended Nov. 30, 2002 were $13.6 million, compared to $7.7 million during the same quarter a year earlier. But CHUM noted, "Operating losses for six of the seven new digital specialty channels launched in September 2001 were capitalized in the first quarter of the 2002 fiscal year because no subscriber revenues were earned on the six new channels during the free preview period that lasted until January 7, 2002." Television revenues for Q1 2003 increased 23.5% to $21.5 million, but operations expenses also rose 22% to $15.9 million. "These television increases are partly a result of the new television businesses beginning operations during the first quarter last year…," states CHUM in its financial report. CAB responds to criticisms of its deal with Bell ExpressVu on out-of-market signalsThe Canadian Association of Broadcasters (CAB) reiterates to the CRTC that its proposed compensation deal with direct-to-home (DTH) satellite TV operator Bell ExpressVu LP regarding the distribution of out-of-market TV signals fulfils the objectives of the Broadcasting Act. Under the proposal, Bell ExpressVu would divert half of the money it currently provides to the Canadian Television Fund to a new fund devoted to local programming (CCR, Nov. 22/02, Oct. 10/02). Producers, the Canadian Broadcasting Corp., and many other groups have lambasted the proposal (CCR, Jan. 16/02), but the CAB is sticking to its guns. "The (proposal) represents a comprehensive response to the current problems facing local broadcasters, involving DTH carriage provisions, direct broadcaster compensation and support for the production of local and regional programming by television undertakings," the CAB writes in its January 17 reply comments to phase-two interventions. "Taken together the CAB submits that these measures will assist local broadcasters to meet the needs of their viewers while providing Bell ExpressVu with the tools it needs to compete against both licensed and unlicensed distribution undertakings." The CAB’s reply comments also include supporting comments from interventions submitted by such MPs as John Harvard, Christiane Gagnon, John Baird, Elsie Wayne, Georges Farrah and Richard Harris, as well as that of Mid West Television Ltd. Harvard and Gagnon are members of the House of Commons Standing Committee on Canadian Heritage, which has been examining the Canadian broadcasting system over the past year. Committee chair Clifford Lincoln has stated the committee’s upcoming report would look at the issue of out-of-market signals. The CAB also suggests that the CRTC proceed on the matter without an oral public hearing, as requested by the CBC. Naked News to air on CHUM’s Citytv, SexTV diginetCHUM Ltd. has picked up the rights to Naked News, and plans to air it on Fridays at 1:05 a.m. on Citytv Toronto and on Saturdays at 11 p.m. on SexTV: The Channel. Broadcast of the news show, in which the anchors disrobe, begins on February 14 on Citytv and on February 15 on SexTV. In a media release, Naked News states that "Naked News TV is the first Internet news program to successfully go from the web to cable television." Citytv is the first conventional station in Canada to air the show and SexTV is the first digital specialty channel to do so. Baseball returns to The Score – but it’ll be CanadianLive baseball will be returning to the headline sports specialty channel The Score, which announced it had signed a rights agreement with the Canadian Baseball League (CBL) for the 2003-04 season. The Score, owned by Headline Media Group Inc., will broadcast 18 regular CBL games, the CBL All-Star game, and the league’s championships. The CBL is a Canadian professional baseball league consisting of eight teams. The games will be aired on Sunday nights, beginning on May 21. Headline Media recently took a $12-million charge to terminate a rights contract that The Score had with Major League Baseball (CCR Update, Jan. 8/03). CRTC approves Serdy acquisition of Bell Globemedia’s shares in Canal ÉvasionThe CRTC has approved the sale of 5,386,206 class A common voting shares held by Bell Globemedia in Canal Évasion to Serdy Direct Inc. (Broadcasting Decision 2003-22). Serdy paid $1.236 million for the shares representing Bell Globemedia’s 53.5% voting interest in the channel, according to the CRTC decision. Before the transaction, Serdy Direct Inc., owned 80% by Serge Arsenault and 20% by Michel Chamberland, held a 19.9% voting interest in the French-language specialty channel devoted to travel, tourism and adventure. It has been in operation since Jan. 31, 2000. In an unprecedented move, the CRTC excepted Serdy from providing a benefits package because of the negative effects that the September 11 terrorist attacks have had on travel, and the fact that the channel has been operating at a loss since its inception. Normally, a benefits package worth 10% of the value of the transaction, in this case $123,000, would have been required for CRTC approval. The deal was announced last year (CCR, Dec. 5/02).

CCR Short Takes

Broadcast | January 30, 2003

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