BDUs worried about wording in new cancellation regulation

Canadian TV providers are worried the wording the CRTC proposed to prohibit policies requiring 30-day notice to cancel TV services could be interpreted to apply to the cancellation of individual channels. Rogers Communications Inc., Shaw Communications Inc., TekSavvy Solutions Inc. and Eastlink all expressed the same concern in interventions posted to the CRTC website Friday and Monday, and asked the CRTC to clarify its wording. The CRTC said in November that it would forbid telecommunications companies from requiring subscribers to give a 30-day notice to cancel their TV, Internet and phone services, effective Jan. 23, 2015. It opened a consultation on the move in May, after the new policy had already been in place for months and its effect had been felt in the quarterly results from TV providers like Rogers and Shaw. In its intervention Friday, Shaw said it was concerned about the wording the CRTC proposed to use in amending its regulations, which would state that the “licensee of a customer shall accept a request for the cancellation of programming services that is made to it by the customer … on the day on which the request is received by the licensee.” Shaw said it was concerned about “the possibility that some may misinterpret this regulation as applying to the cancellation of individual programming services and packages.” Rogers said the CRTC put the policy in place in order to make it easier for customers to switch telecom providers, but that the wording suggests it also applies to “the cancellation of subscriptions to individual programming services or packages of programming services that may form part of the broadcasting distribution service.” It added: “We do not believe that this is the intent of the policy determination.” If the policy is applied to individual channels, that would mean “consumers would be able to subscribe to channels on a per-day or per-program basis,” Rogers argued. “This would effectively change the linear television subscription model into a video-on-demand (VOD) model for a fraction of the cost.” Eastlink said that allowing customers to change the channels they subscribe to on a daily basis would “create chaos” for broadcasters and broadcast distributors. For example, a consumer may subscribe to a particular sports channel for four hours in order to watch a playoff hockey game, or, a customer could subscribe to HBO on Sundays only over the course of several months in order to watch Game of Thrones,” it said. If that were allowed, the TV provider “would face significant setup and administration costs in relation to that customer that it could not possibly recover over the course of a single day’s subscription.” Also, since many agreements governing carriage fees are based on how many subscribers a channel has at the beginning and end of the month, “if the customer’s single day subscription occurred in the middle of the month, the channel would not receive any wholesale fees in relation to that customer’s subscription to the service.” TekSavvy said the language used by the CRTC could “result in a double-bind in which the distribution undertaking is required by the Regulations to cancel an individual programming service immediately, but is prohibited by an affiliation agreement from doing so.” It suggested the CRTC take steps to “prohibit affiliation agreements from including clauses requiring distribution undertakings to impose minimum subscription durations for any programming service.” The interventions on the CRTC’s site did not include a document from BCE Inc., though the company expressed worries about the consequences of giving customers the unrestricted right to change the channels they subscribe to in a separate proceeding last month. It said at the time that allowing customers to change their subscriptions on a daily or hourly basis is “contrary to the underlying business model for linear television.” In response to a question about whether the CRTC intends to apply the new policy to individual channels, CRTC spokeswoman Céline Legault said in an email that “the 30-day cancellation policy applies to TV service agreements as a whole.” — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Derek Abma at dabma@thewirereport.ca

BDUs worried about wording in new cancellation regulation

Broadcast | June 15, 2015

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BDUs worried about wording in new cancellation regulation

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