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Commission asks about selling U.S. local avail ad time


OTTAWA - Twenty months after the original application from the Canadian Cable Television Association asking that the rules be changed and that Canadian cablecos be allowed to sell advertising on American cable channels, the Commission has finally called for comment on the matter.

Back in November 2002, the CCTA and Vidéotron made similar applications to the CRTC asking that Commission policy be altered so that cable companies could sell the two minutes per hour made available by American cable channels such as CNN and TLC to sell ad time locally. The so-called local avails allow American MSOs to sell ads to local businesses.

However, in Canada, the Commission has said that 75% of the local avail time must be given over to the promotion of Canadian specialty services with the remaining 25% going to the promotion of cable company television services.

The CCTA's amended application sets out how 25% of the revenue earned from such sales would be diverted to the Canadian Television Fund and in 2003, the cable group estimated that would earn the fund an additional $10 million a year.

Broadcasters have always fought this idea, which has risen from time to time (the last time it was seriously addressed was in 1997 - CRTC Public Notice 1997-25, where the Commission decided to ignore a similar cable request).

"Broadcasters now have multiple windows to promote their services and, in terms of penetration and financial performance, awareness is high. The overall strength of programming services stands in stark contrast to the challenge of producing high quality distinctive Canadian television programming. CCTA submits that its modified proposal addresses this challenge without materially impacting programming services," says the CCTA's dusty application.

The CRTC's call for comments asks the following five questions:
a) What are the advantages and disadvantages of the CCTA's proposal for the Canadian broadcasting system as a whole, and for the French- and English-language markets, individually?

b) What impact could the CCTA proposal have on the promotion of Canadian programming services in the French-language market and in the English-language market?

c) If the Commission were to modify its policy regarding the use of local availabilities, should the modified policy apply to DTH and other BDUs as well as cable BDUs?

d) What are the implications of allowing BDUs to advertise, within the local availabilities, affiliated services, such as telephony and Internet services?

e) What impact would the CCTA proposal have on Canadian advertising inventory and rates in the French-language market and in the English-language market?

The deadline for comments is October 7, 2004.

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