CBC's Hubert Lacroix suggests a cheap cable group with CBC....
Dan Say
I still want over-the-air, much of which will die under
digitial TV reception.
The press release from CBC
http://www.newswire.ca/en/releases/archive/November2009/17/c2071.html
Offer Canadians low-cost skinny TV package, CBC tells cable firms
By Julian Beltrame (CP) � 1 hour ago 17 Nov 2009
GATINEAU, Que. � A proposal for all-Canadian a no-frills cable and satellite
TV packages to keep consumer costs low was attacked by Bell TV's satellite
service Tuesday as "self-serving" and unfair.
The so-called skinny basic option was proposed earlier in the day by CBC
officials as a way to square the demand by conventional broadcasters that they
be paid for their signals with the refusal of cable and satellite operators to
negotiate a fee.
"The simplest and most consumer-friendly approach would be to establish a
small, all-Canadian basic service which would include all local television
stations and a very limited set of other programming services," CBC president
Hubert Lacroix told the Canadian Radio-television and Telecommunications
Commission.
Under the so-called "skinny basic" service, cable and satellite carriers could
then charge whatever extra they wanted to for various expanded packages.
But Bell Canada vice-president Mirko Bibic said the idea would not work
because a low-cost basic service will lose the carriers money.
And he accused CBC of acting solely in self-interest since, under the
Broadcasting Act, it would have to be part of the package.
"The proponents of skinny basic are self-serving," he said. "They are saying
there's a value to the CBC signal and if BDUs (cable and satellite firms)
don't agree there is a value, they say, 'Too bad, you have to carry it."'
Bibic went on to say he does not believe the CRTC has a legal right to force
the carriers to negotiate on a fee-for-carriage charge.
But commissioner Michel Arpin told Bibic he was wrong about the power of the
CRTC.
"That's a decision we think we have a right (to make) and we've already made
it," Arpin said.
The exchange once again brought to the fore the contentious nature of the
hearings over fee-for-carriage, which conventional broadcasters such as CTV
and Global TV say they need just to survive in a 500-channel universe and the
fragmentation of advertising dollars.
Cable companies, which have become among the most profitable sector of the
industry, have refused to pay for something they say the broadcasters give
away for free over the air, and to the Internet.
The situation is somewhat different for Bell TV, which Bibic noted has yet to
turn a profit, although it is nearing that point.
In questioning, CRTC commissioners are giving every indication they are
leaning to establishing the ground rules for some form of negotiations between
the suppliers of television content and the pipeline that distributes it to
Canadians.
Noting that the CRTC had foreseen this battle as far back as 1971, commission
chairman Konrad von Finckenstein pointed out that the advent of specialty
channels had changed the business model of the traditional broadcasters.
"The model was built before we had specialty channels," he said. "There has
been a paradigm shift in the underlying assumptions."
Bibic responded that taxpayers should not be asked to ensure that broadcasters
succeed, saying the networks and local television stations need to adapt and
find other forms of revenue, or cut costs.
On Monday, Rogers Communications, Canada's largest cable company, said if it
were forced to pay broadcasters for their signals, customers would wind up
paying up to $10 a month extra.
The sensitivity of the issue likely means that whatever the CRTC decides, the
Conservative government will likely need to weigh in at some point, said media
analyst Michael Geist of the University of Ottawa.
"None of the sides want to compromise," he said.
The CBC's proposal is an attempt to keep the cost low, and to exempt some
Canadians from any increase.
Consumers would be protected from gouging, said Steven Guiton, CBC's
regulatory officer, because the low-cost option would offer an escape valve
for viewers.
"It will temper the marketplace because if rates are going up, (consumers)
will have an option. It's existence alone will help temper prices for all the
other services," he said.
The CBC's position is similar to that of private sector broadcasters - except
unlike CTV - it is not willing to pull its signal in the case it cannot reach
agreement on a fee-for-carriage charge.
But Lacroix and other officials laid down similar arguments about why
conventional broadcasting, once the linchpin of Canadian television, has hit a
wall and needs a change in the rules to continue.
The recession has hurt, he agreed, but the officials presented the commission
with a series of charts that showed the downward slide in profitability for
conventional television began in the early 1980s, when cable specialty
channels began splintering viewership and advertising dollars.
Meanwhile, Lacroix said the industry's pipeline has grown exponentially richer
since 1998, when the CRTC deregulated the sector.
After reacting in frustration Monday with the inability of the parties to
compromise, von Finckenstein and other commissioners appeared more receptive
of the CBC proposals.
"We're all striving for a solution in which Canadians don't have a higher
bill, or if they do, it's because they are getting a better product," von
Finckenstein said.
He laid out the option that conventional broadcasters would only be paid for
high-definition signals. And other services could be exchanged, instead of
cash, in the negotiations, he said.
"I would very much prefer to sanction a negotiated solution rather than to
impose a solution," he added.
The Canadian Press.