11/7/2003

OTTAWA - The CRTC today did what many expected and denied the Canadian cable industry's request to add popular U.S. cable channels such as ESPN, HBO, Fox News and Showtime to the list of eligible satellite services.

But that doesn't mean the battle is over, says the acting president of the Canadian Cable Television Association.

As reported and commented on by broadcastermagazine.com several times, earlier this year the CCTA applied to the Commission to add several channels to the eligible satellite list which would only have been eligible for distribution in a digital tier linked to Canadian digi-nets.

The channels on the list were some of the big U.S. brands: HBO and its multiplexes, ESPN, ESPN2, Showtime and its multiplexes, Starz and its multiplexes, Sundance, Cinemax, The Movie Channel, Lifetime Movies, Flix, Fox Sports Nets (18 regional channels), The NFL Channel, Fox News, FamilyNet, Noggin, Nickelodeon Kids and WAM!

The CCTA told the Commission in its application that some of the Canadians stealing American satellite signals were doing so because of the programming they could not receive here. Plus, digital penetration has slowed and offering these channels, tied to Canadian digi-nets, would perk up digital cable (and satellite) penetration.

But basically, the Commission said today it will abide by its current policies of protecting the genres of existing Canadian specialty services by keeping these foreign services out. Its decision also cited fears that Canadian specialty services would no longer be able to purchase programming from U.S. outlets as those channels would hang onto Canadian rights for themselves (and expect a hurricane of half-informed editorials from across the land on this issue over the next few days, especially leading into the CAB Convention beginning Sunday in Quebec City).

"The Commission is concerned that acceptance of CCTA's proposal could undermine the benefits of the Commission's current approach, with little assurance that sufficient off-setting benefits would materialize," reads the decision. "Most significantly, the Commission is concerned that adoption of CCTA's proposal would make it more difficult for Canadian services to obtain the Canadian rights to broadcast foreign productions. The loss of the revenues generated by such foreign programs could result in a decrease in the production and broadcast of Canadian programming."

"The Commission once again showed resolve to uphold the policies that allow our broadcasting system to thrive," Canadian Association of Broadcasters president and CEO Glenn O'Farrell told broadcastermagazine.com today. "We said all along this was a very transparent cash grab. It makes no sense whatsoever to try to convince Canadians to pay more for the programming they already get."

Acting CCTA president Michael Hennessey told broadcastermagazine.com today that he was disappointed with the decision - and that this doesn't spell the end of this issue.

"We were disappointed there wasn't a public hearing, which was our strategy… we would have all benefited from a public discussion," he said, adding he's encouraged by the fact the Commission didn't close the door all the way on the issue.

"It gives us the opportunity to come back and address the deficiencies," added Hennessey. While the CCTA won't return with a new application before Christmas or anything, "we will be back," he said, in less than 12 months.

But next time, the CCTA wants input from Canadian broadcasters on how this idea can somehow get put into practice. "We will be looking to broadcasters this time around to roll these services out in a way they see benefiting everybody," he explains. "We're not going to go to war or anything on this… we're willing to listen to options."

O'Farrell declined comment on what the CCTA might do, adding only "it's an evolving situation, but the broadcasting system has always been an evolving situation."

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