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Bell sues Videotron over TV fee levels
6/10/2002

Montreal, Bell Globemedia is taking Quebec competitor Videotron to court in a dispute over fees charged for Bell-owned TV sports networks.

Alain Gourd, executive vice-president at Globemedia, said Friday that Videotron is abusing its 80 per cent dominant position in
Quebec's television market by trying to pay less for Globemedia channels than it's supposed to.

Globemedia, owned by BCE Inc., said it will file a suit in Quebec Superior Court. It also filed a complaint Friday with the Canadian Radio-television and Telecommunications Commission.

The lawsuit is among several filed between the two companies at a time when cable TV companies are losing market share to direct-to-home TV feeds from satellite companies such as ExpressVu, part of Bell Globemedia.

The court suit is to challenge Videotron's method for counting subscribers, claiming that Videotron reports fewer customers than it really has to avoid fees.

The suit alleges that Videotron, for example, counts an apartment block or a hospital as one subscriber, when in fact it may have as many as 20 or 100 subscribers in the same building. That allows Videotron, a subsidiary of Quebecor, to pay Bell Globemedia less for some of its channels, like the sports networks,
Globemedia says.

``We believe the counts of Videotron of its subscriber loss are questionable,'' Gourd charged in a conference call. ``It's obvious
to us that Videotron has chosen to abuse its dominant position.''

The amount of damages that Globemedia is seeking was not revealed.

It also alleges that since last January, Videotron reduced the fees it pays for RDS, the French sports network, to 50 cents a
subscriber, from $1.57.

Videotron claims that is because Netstar, Globemedia's owner of RDS and its English-language counterpart, TSN, charges less to
Videotron competitor Bell ExpressVu than to Videotron. Videotron has filed a suit for $13.4 million against Netstar to recoup what it says it overpaid.

Videotron says Netstar's preferential rates to ExpressVu contravene a five-year contract signed with Netstar in September 1997. The suit goes back to May 2001 when it says Quebecor, the new owner, realized what was happening.

Gourd said Friday the accusation is false. ``RDS states categorically that it has no undue preference for ExpressVu,'' he
said.

Globemedia, owner of the CTV network, which owns Netstar among other media, also asked the CRTC on Friday not to approve Videotron's request for deregulation in some of its markets until other issues are resolved.

``If it is deregulated, Videotron will abuse its power even more,'' Gourd said.

Quebecor and BCE moved aggressively into convergence, combining media content with carrying capacity, but so far without reaping much benefit.

Videotron owner Quebecor and Bell Globemedia are both hard up for cash and there is speculation that BCE may even want to unload Globemedia. Gourd would not comment on that possibility.




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