Cdn cable eyes U.S. services
TORONTO (CP) — Canada’s major private broadcasters expressed shock and dismay Thursday after the cable companies applied to directly import and carry 17 U.S. TV channels, including such coveted services as HBO, Showtime, ESPN and Fox News.
The reasons given for the formal application to the Canadian Radio-television and Telecommunications Commission were to combat satellite TV piracy and to give a boost to the struggling digital tier of cable services.
“Our research and customer feedback indicate that it’s critical to respond to consumer expectations for more choice,” says Janet Yale, president of the Canadian Cable Television Association. “We have 700,000 households that are watching them illegally.
But the move was described as a “cynical cash grab in disguise” that would not benefit consumers or the broadcast industry and a major fight was promised.
“We’re not going to take this lying down,” said Glen O’Farrell, president of the Canadian Association of Broadcasters, who confirmed that a counter-submission would be filed soon with the CRTC.
“It strikes so much at the heart of what the Canadian broadcasting system is all about,” added Paul Robertson, president of Corus Entertainment. “I think we’re all going to have to fight it with everything we’ve got.”
The broadcasters argued that consumers would end up paying more for favourite U.S. shows they already get, such as HBO’s The Sopranos, Oz, Sex & the City and Six Feet Under, and further that the industry would be plunged into anarchy.
“Quite frankly cable has been hinting at looking for an excuse to do this for some time,” said Peter Miller, vice-president of planning and regulatory affairs for CHUM Television. “The trouble is it didn’t make any sense then and it still defies logic now.”
Miller said those in the black market will still prefer to steal programming rather than pay even more for Canadian cable, and he doesn’t see the CRTC approving the request.
But Yale, speaking from Ottawa, said the customer must come first.
“Consumers. . .are completely comfortable from a behavioural and attitudinal perspective, with bypassing the system. They don’t see anything wrong with doing it if we don’t give them what they want.”
Yale doesn’t expect any decision for 12 to 18 months and so feels any discussion now about pricing and royalties is premature. But if approved, it would mean Canadians could watch first-run American shows instead of waiting for domestic telecasts delayed for anywhere from a few days to a year.
HBO’s The Sopranos, for example, airs on pay channels like The Movie Network or Movie Central a couple of days after the U.S. telecast, or a year later on CTV.
Sex & the City’s sixth season begins on HBO this weekend, but not on Bravo until September.
The cable companies’ argument is that piracy and the fate of the diginets takes precedence over fears of increased competition. Launched in the fall of 2001, only about 20 per cent of Canadian TV household have subscribed.
“Services that are on there, many of them are floundering,” said Peter Bissonette, president of Shaw Communications. “And they’re floundering because they don’t have the exposure that we think they will have . . . through more attractive packaging.”
Yale said it’s not a new technique to bundle new Canadian offerings with attractive U.S. services. It had been done before with the likes of A&E and CNN.
And while fewer Canadians are opting into the illegal satellite market, Louis Audet, president of Cogeco Cable said the industry is still losing $450 million a year in revenues to pirated U.S. dish services.
“The black market has in fact been chilled,” he says. “But the fact remains there is a chunk of the Canadian public still in.”
Bissonette likened the sellers of pirated services to a residual foot fungus that must be rooted out.
Ian Morrison, spokesman for Friends of Canadian Broadcasting, says his lobby group is not waving the Canadian flag on this issue but he does feel access to U.S. TV is already strong.
“We’re not the one with that quote ‘Keep the Yankees out’ kind of thing,” Morrison says. “The cable industry is clearly hurting.”
He believes content suppliers like CHUM and Alliance Atlantis want more people to buy their digital services but would also have a problem with the new imported competition for viewers.
“So the CRTC has a kind of Gordian Knot problem, a huge issue to deal with.”
The 17 U.S. premium movie, sports and kids’ channels that Canadian cable companies want to carry on their digital tiers:
* HBO (Home Box Office and its multiplexes)
* Showtime (and its multiplexes)
* Starz (and multiplexes)
* The Sundance Channel (independent movies)
* Cinemax (HBO’s movie service)
* The Movie Channel (Showtime’s movie service)
* Lifetime Movies
* Fox Regional Sports Net channels
* The NFL Channel
* Fox News
* Nickelodeon Kids
Cdn cable eyes U.S. services