DAILY NEWS Mar 18, 2013 8:23 AM - 0 comments

CRTC Says OWN Must Comply with Conditions of Licence

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2013-03-18

The CRTC has issued a mandatory order requiring OWN Inc. to ensure that OWN: The Oprah Winfrey Network complies with its nature of service definition, which is to provide formal and informal educational programming and learning opportunities that generally focus on adult education and that come from a full spectrum of basic, credit-based, skills-related and life-enhancing programs. Further, the Commission provides guidelines and imposes reporting and monitoring requirements to ensure the licensee’s compliance with its conditions of licence and regulatory requirements.

Because of concerns about the licensee’s compliance with OWN’s nature of service definition, the Commission called OWN Inc. to a public hearing held on 11 December 2012 to inquire into, hear and determine the matter relating to the licensee’s apparent non-compliance.  Specifically, it called OWN Inc. to that public hearing to show cause as to why the Commission should not:

issue a mandatory order under section 12 of the Broadcasting Act (the Act) requiring the licensee to adhere to its nature of service definition; or

suspend or revoke the licence pursuant to sections 9 and 24 of the Act.

The Commission announced its decision to hear two further applications filed by OWN Inc.:

*The first application  is for a broadcasting licence to operate a national, English-language specialty Category B service to be known as OWN: The Oprah Winfrey Network. Specifically, the service would provide educational programming and learning opportunities that would generally focus on informal basic adult education, skills-related and life-enhancing programs.

*The second application seeks to amend the definition of “broadcast day” for OWN’s Category A licence so as to schedule its programming over a 24-hour rather than an 18-hour period.

The Commission licenses new services as specialty Category A services on a one-per-genre basis. The Commission generally requires that these services be complementary and not compete directly with one another. Each Category A service therefore has a unique nature of service and a unique role to play in providing a wide range of Canadian programming choices to Canadians and ensuring the maximum contribution to the creation of Canadian programming. In recognition of this role, the Commission grants Category A services a number of benefits, including guaranteed distribution by licensed cable, satellite and other distributors.

The licensee shall provide a national English-language specialty Category A service which provides formal and informal educational programming and learning opportunities that generally focus on adult education. Educational programs will come from a full spectrum of basic, credit-based, skills-related and life-enhancing programs, many of which will be undertaken in cooperation with colleges, universities and training institutions.

In a press release on 29 September 2010, Corus announced the rebranding of VIVA as OWN. It stated that OWN would target adults between the ages of 18 and 54 with a core of women aged 25 to 54 and explore issues from health and wellness, home and relationships to stories of strength and transformation. In a letter dated 4 October 2010, the Commission requested that the licensee explain how the programming described in this press release was consistent with the licensee’s current nature of service definition. In its reply of 18 October 2010, Corus stated that the rebranding would provide significant benefits to the Canadian broadcasting system and that OWN would operate in full compliance with all conditions of licence, including the nature of service definition.  In a subsequent letter to Corus dated 6 December 2010, the Commission stated that it might follow up on this matter at the group licence renewal hearing in the spring of 2011.

After considering the licensee’s arguments at that hearing, the Commission found in the Corus group renewal decision that the licensee had not complied with its nature of service definition. In particular, the Commission concluded that the service’s curriculum of educational programs did not reflect the variety of educational programming required in its nature of service definition. The Commission further noted that most of the other programs listed on the programming schedule explored the broad themes of food and nutrition, fitness, beauty and well-being, family and relationships, and design. In general, it found that OWN’s programming was too heavily focused on the enhancement programming (i.e., life-enhancing) portion of its nature of service definition and therefore fulfilled only part of its mandate. Consequently, the Commission directed the licensee to file a report by 1 March 2012 detailing the measures it had taken to bring the service into compliance with its nature of service definition. Alternatively, the Commission stated that it expected the licensee to surrender the broadcasting licence for its specialty Category A service by the same date and apply for a broadcasting licence to operate a new Category C service or submit another appropriate proposal.

On 1 March 2012, Corus filed an application on behalf of OWN Inc. for a broadcasting licence to operate OWN as a specialty Category B service. Corus proposed to discontinue OWN’s operation as a specialty Category A service. It specified that its application was conditional on the Commission’s allowing the continued carriage of OWN on Shaw-owned cable systems by authorizing an exception to the Commission’s rule respecting the carriage of related Category B services.[1]

In a letter dated 22 June 2012, the Commission indicated to Corus that it would not process an application that was conditional upon another application by a third party, such as Shaw. Consequently, the Commission once again directed the licensee to come into compliance with its nature of service definition, and this time, by 1 September 2012, or to submit an application by 9 July 2012 for a new broadcasting licence to operate OWN as a specialty Category B or Category C service.

On 23 July 2012, Corus filed an application[2] under Part 1 of the Canadian Radio-television and Telecommunications Commission Rules of Practice and Procedure  to amend OWN’s broadcasting licence to re-designate the service as a specialty Category B service and amend OWN’s nature of service definition. Since the broadcasting licence for OWN had been renewed until 31 August 2016, it proposed that the amendments apply to the remainder of the service’s current licence term and that the Commission issue a new broadcasting licence whereby OWN would be operated as a specialty Category B service as of 1 September 2016. Corus noted in its application that such an amendment would avoid the unnecessary renegotiation of existing affiliation agreements with broadcasting distribution undertakings that currently distribute OWN.

The Commission informed Corus in a letter dated 15 August 2012 that because of the policy considerations raised by the application, it would not process its application under Part 1 of the Rules of Procedure and that it would inform Corus regarding the next steps to be taken.

On 12 October 2012, the Commission announced the 11 December 2012 public hearing. In that notice, the Commission stated that neither of the applications submitted by Corus adhered to the directives set out in the Corus group licence renewal or the Commission’s 22 June 2012 letter. Consequently, it appeared that OWN Inc. remained out of compliance with its nature of service definition. As a result, the Commission called the licensee to a public hearing to inquire into, hear and determine the matter.

In the lead-up to the public hearing, the Commission expressed concerns in a letter dated 29 October 2012 about the service’s broadcast of formal educational programming, as well as the licensee’s practices relating to the submission of program logs.

On 30 November 2012, Corus submitted a letter to the Commission in which it proposed changes to its program schedule. These proposed changes included the creation of new formal education programming (not yet produced), an increase in the variety of the types of basic, skills-related and credit-based programs offered on the service, and limiting the number of series tied to any given academic course.

At the public hearing, the Commission questioned the licensee on the broadcast of programming from program category 7 Drama and comedy in light of the fact that the service does not have authorization to draw programming from this category. These concerns are discussed further below.

In response to Broadcasting Notice of Consultation 2012-560, the Commission received many interventions in support of OWN Inc. It also received an intervention from the Canadian Media Production Association offering general comments on the issues set out in that notice, as well as interventions in opposition from students at Carleton University and from the Writers Guild of Canada. Corus, on behalf of OWN Inc., replied collectively to all of the interventions received.

The Commission received an intervention from Channel Zero Inc. opposing both applications, as well as an intervention from the CMPA in opposition to the application to amend the definition of “broadcast day.” Corus, on behalf of OWN Inc., also replied collectively to those two interventions.

After examining the public record for the present proceeding in light of applicable regulations and policies, the Commission considers that the issues it must address are the following:

the licensee’s apparent non-compliance with OWN’s nature of service definition;

concerns relating to the filing of accurate program logs;

concerns relating to the broadcast of formal educational programming;

concerns relating to the broadcast of programming drawn from program category 7 Drama and comedy;

concerns relating to programming overlap between OWN and W Network, which is also owned by Corus;

the licensee’s request to amend the definition of “broadcast day”; and

the licensee’s application for a broadcasting licence to operate a specialty Category B service.

Apparent non-compliance with OWN’s nature of service definition

In the Corus group licence renewal, the Commission expressed concern that OWN’s programming had departed from its nature of service definition. It considered that the service’s curriculum of educational programs did not reflect the variety of educational programming required in its nature of service definition and that the service was too heavily focused on “enhancement programming.” As such, it found that OWN was fulfilling only part of its mandate.

Upon examination of the service’s history and the public record relating to this proceeding, the Commission is concerned that the licensee remains in non-compliance with OWN’s nature of service definition.

Two of the opposing interventions received were submitted by groups of students at Carleton University. In one of those interventions, the interveners stated that rather than respecting its nature of service, OWN had chosen a format close to that of the W Network. They submitted that this likeness in programming had caused a decrease in program diversity as there were now two channels working within a genre targeting women. In the other intervention, the interveners expressed concern that the service offers enhancement programming, not educational programming, with a very narrow range of classes.

The Writers Guild expressed concern that OWN’s non-compliance was part of a growing trend among programming services and urged the Commission to continue its efforts to enforce its genre exclusivity policy. The Writers Guild further submitted that with a schedule packed with home design, food and shopping programs, Corus had essentially abandoned its mission to provide formal educational content through a wide range of programming.

The CMPA stated that it supported the Commission in taking measures to ensure that licensees do not abuse its rules and policies regarding their nature of service definitions.

Corus took issue with the Carleton University students’ statement regarding a decrease in programming diversity. It submitted that OWN and Corus had contributed more Canadian content diversity to the Canadian broadcasting system in the last five years than any other broadcaster or producer. Corus further stated that it had made good faith efforts to respond to the Commission’s concerns to ensure that OWN is operated in full compliance with its nature of service.

Corus similarly rejected the submission by the Writers Guild that OWN had abandoned its mission to provide formal educational content through a wide range of programming.

In response to the intervention by the CMPA, Corus stated that it did not take issue with the Commission’s legitimate role in ensuring that the licensee of a specialty television service adheres to its authorized nature of service. It also welcomed the opportunity to demonstrate its commitment to operate OWN in a manner that was consistent with its nature of service.

At the public hearing, Corus made extensive representations in response to both of these interventions and the Commission’s questions, and reiterated and elaborated on the points it had made in response to written interventions.

OWN was licensed to provide formal and informal educational programming and learning opportunities that generally focus on adult education. OWN’s educational programs are to come from a full spectrum of basic, credit-based, skills-related and life-enhancing programs, many of which will be undertaken in cooperation with colleges, universities and training institutions. This intent is set out clearly in its condition of licence relating to its nature of service.

A review of OWN’s programming schedule for the week of 21-27 October 2012 as set out on its website (which formed part of the record for the hearing) reveals that the licensee has done little to address the Commission’s programming concerns since the Corus group renewal decision.

In the Commission’s view, the licensee has not sufficiently addressed the concern that OWN is focused on “enhancement programming” rather than offering a “full spectrum of basic, credit-based, skills-related and life-enhancing programs,” as contemplated in its nature of service definition. The Commission finds that a disproportionate amount of OWN’s schedule is still composed of “life-enhancing” programming, with the result of an insufficient representation of basic, skills-related and credit-based programming.

Moreover, the Commission finds that the licensee has not addressed concerns regarding the limited scope of OWN’s accredited programming (i.e., programming associated with courses or training offered by educational institutions). Such programming would meet the requirements that some of the service’s programs be credit-based and that many of its programs be undertaken in cooperation with colleges, universities and training institutions. In the Corus group renewal decision, the Commission expressed concern that eight programs listed on the schedule were associated with a single script writing course and two programs were associated with three different courses in cinematography, story development and video production techniques. The Commission notes that as of 22 October 2012, the website for OWN showed that 14 of its 19 accredited programs relate to television production and that 9 of those 14 programs are accredited to a single course, Ryerson University’s “Writing for Factual Programs.” As a result, the Commission finds that OWN’s curriculum of accredited programs still does not reflect the variety of educational programming required by its nature of service definition.

Although Corus expressed confusion about what is meant by its requirement to offer a “full spectrum of basic, credit-based, skills-related and life-enhancing programs,” the Commission considers that its intent in this regard was clearly set out in the Corus group renewal decision.

The Commission further considers that the licensee has had ample time since its licence renewal in 2011 to increase its basic, credit-based and skills-related programming and to explore new relationships and accreditation opportunities with a variety of learning institutions. The Commission also notes that it was only after OWN Inc. was called to a public hearing that it took any steps readily apparent to the Commission aimed at changing OWN’s programming schedule with a view to addressing concerns regarding OWN’s compliance with its nature of service definition.

Following its 2011 renewal, there were a number of procedural options available to the licensee to remedy its non-compliance. The licensee first filed an application to operate OWN as a specialty Category B service, but this application was not processed since it was conditional upon the approval of another application by a third party. The Commission notes that the instructions provided in its 22 June 2012 reply letter were to either submit an application by July 2012 to operate the service as a Category B or Category C service, or come into compliance with its nature of service definition by 1 September 2012. While OWN submitted a licence amendment application on 23 July 2012, this application did not conform to the above-noted instructions and was not processed because of the policy considerations that it raised. Therefore, the only option available to the licensee as of that date was to come into compliance by 1 September 2012. Moreover, in this regard, the Commission notes that the licensee is required to be in compliance with its nature of service condition of licence at all times. The Commission therefore does not consider appropriate OWN’s argument that it did not modify its programming because it was pursuing other procedural avenues to address the Commission’s findings in the Corus group renewal decision.

Finally, the Commission also notes that at the public hearing the licensee acknowledged the Commission’s finding in the Corus group renewal decision that OWN was in non-compliance with its condition of licence relating to its nature of service definition.

In light of the above, the Commission finds that OWN Inc. remains in non-compliance with OWN’s nature of service definition.

The Commission notes that the licensee made a number of commitments at the hearing to address the Commission’s concerns relating to OWN’s compliance with its nature of service definition. In particular, OWN Inc. proposed that:

no less than six different “genres” will be covered each year; and

there will be a refresh rate of 50% from one year to another.

The Commission also notes that Corus, in the proposed programming schedule detailed in its 30 November 2012 submission, indicated that a maximum of two programs would be tied to a single course at any given time.

The Commission considers that adherence to the above commitments and a limit on the number of programs tied to a single course (specifically, no more than two) would assist the licensee in ensuring that OWN fulfills its requirement to provide a full spectrum of basic, credit-based, skills-related and life-enhancing programs and would address the Commission’s concerns relating to the lack of variety in its accredited programming. The Commission therefore directs OWN Inc. to implement these measures.

The Commission notes, however, that the licensee did not provide any insight into how it would define “genre.” The Commission cautions that the term is not to be interpreted too narrowly and that it should be interpreted as a field of study. The Commission considers that examples of fields of study or genres include but are not limited to the following: Interior Design, Nutrition, Psychology and Media Production. As an example, courses such as “Cinematography,” “Story Development” and “Video Production Techniques” would all be considered to be Media Production courses and therefore would be considered as belonging to a single field of study or genre.

 In light of OWN’s Category A status and in order to monitor its adherence to the above-noted measures and ensure its future compliance with its nature of service definition, the Commission considers it appropriate to impose certain monitoring and reporting requirements. Accordingly, pursuant to section 8(2)(b) of the Specialty Services Regulations, 1990 (the Regulations), the Commission directs OWN Inc. to adhere to the monitoring and reporting requirements set out in Appendix 2 to this decision.

In light of the licensee’s longstanding non-compliance and to ensure its future compliance with its nature of service definition, the Commission considers it appropriate to issue a mandatory order under section 12(2) of the Act requiring OWN Inc. to comply at all times with the nature of service definition for OWN. This mandatory order is set out in Appendix 1 to this decision.

Pursuant to section 13 of the Act, the order will be filed with the Federal Court and will become an order of that court. Failure to comply with Federal Court orders may result in recourse to the compliance procedures of that court.


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