Quebecor accuses BCE of ‘undue advantage’ in refusing Sun News carriage proposal

Quebcor Media Inc. is accusing BCE Inc. of an “undue advantage” for refusing a proposal to carry the company’s new Sun News Network. Luc Lavoie, the company’s head of development for Sun News, said in an interview that Quebecor proposed a carriage deal to Bell that will cost the distributor less than what it pays to carry each of its Bell Media Inc.-owned news services. “We’re quite troubled by the fact that they’re saying this was an unreasonable proposal. What we’re dealing with here is clearly a case of undue advantage,” Lavoie said in a brief interview Tuesday. He noted that BCE’s Bell Media division owns CTV News Channel, the Business News Network, and CP 24, and said those channels receive better carriage deals than Quebecor’s proposal for Sun News. “In all three cases, they’re giving those three a better deal than what we’ve asked for. If that’s not undue advantage, I don’t know what is,” he said. “We’re asking for less than they’re giving themselves.” Quebecor said it plans to file an undue preference complaint with the CRTC on Wednesday. The Sun News Network was removed from Bell’s satellite distribution service Tuesday morning after the two companies could not reach a carriage agreement. Quebecor has so far reached carriage deals with Shaw Communications Inc. and Quebecor’s own cable distributor, Videotron Ltée. To receive carriage on basic cable and IPTV, Quebecor has also replaced its local programming on Toronto conventional station Sun TV with that of the Sun News Network. Sun TV, as a local, over-the-air channel, must be carried on basic cable packages, according to CRTC broadcasting policy. Over-the-air channels must be carried without any cost to the distributor unless the broadcaster elects to seek payment for the service under the CRTC’s new value-for-signal regime. But Bell was also carrying the channel on its satellite television service, for which the rules are different, Lavoie said. Quebecor approached Bell about two weeks ago to request that the distributor try to reach a carriage agreement. “We said to them, ‘This does not apply to DTH , and you have to have an agreement with us. If you don’t, we’ll have to pull the plug on you,’” Lavoie said. “We presented them with essentially the same proposal we’ve made to Shaw.” Bell came back to Quebecor on Monday saying that the proposal was unreasonable, Lavoie said, and Quebecor pulled the signal from Bell’s satellite television service. He said the carriage proposal with Bell is confidential. “Sun News has withdrawn its signal from Bell Satellite TV as we do not have an agreement with Quebecor to carry it,” Jacqueline Michelis, a spokeswoman for Bell, told The Wire Report in an email statement. But the channel, which is also broadcasting on the Sun TV over-the-air licence, is still being carried on Bell’s terrestrial IPTV distribution service, she noted. “However, Sun News is still available on Fibe TV in Toronto as it is operating as an over-the-air local station that must be carried locally.” Michelis suggested that the dual-licence nature of the channel made its carriage terms unclear. "It’s worth noting that Sun News launched on Monday April 18 but only declared the day before, Sunday April 17, that it wanted Bell Satellite TV to treat Sun News as a Category 2 discretionary national news service. And that was only after Bell contacted the CRTC the week before in hopes of clarifying the matter," Michelis wrote. "Before April 17, we didn't know whether we would have to pay for the service via commercial negotiation or if Quebecor wanted it to be treated as any other local OTA." Michelis said Bell hoped to reach a carriage agreement because Sun News is "a new and relatively untested channel on the market. But the price being asked is quite excessive--it’s in line with what would usually be quoted for a well-established and popular channel." She said Bell made "a realistic counter-proposal" and asked for a response but has not heard back other than through media reports. Michelis wrote that if there is some insinuation that Bell Media is favouring its own three news channels "because of some corporate connection, you need to note three things: All are well-established and popular channels. All were carried by Bell TV long before Bell acquired CTV, and on realistic commercial terms. And all are carried by our competitors the same way as well." On Bell’s satellite service, the former Sun News channel now displays a message saying it has been removed “at the request of the owners of Sun News.” Lavoie said customers are complaining to Quebecor. “We’re receiving thousands of emails from customers who were watching us on Bell,” he said. Quebecor is telling those customers to contact Bell customer service to ask the company to reach a carriage agreement, he said. Lavoie said he couldn’t be sure whether the issue will come up at the CRTC’s vertical integration hearing in June. He said he is focused on getting carriage for the all-news service, reiterating that the same proposal was acceptable to Shaw and Videotron. “If it’s acceptable to everybody else, why the hell is it unreasonable to Bell?” Lavoie said. He said Quebecor does not intend to elect to negotiate carriage for the channel as an over-the-air service under the CRTC’s new value-for-signal-regime. “This is essentially a Category 2 channel, and it’s on that basis that we’re negotiating the signal,” he said. sdoyle@thewirereport.ca

Quebecor accuses BCE of ‘undue advantage’ in refusing Sun News carriage proposal

Broadcast | May 3, 2011

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