ARCHIVED - Broadcasting Decision CRTC 2003-257

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Broadcasting Decision CRTC 2003-257

 

See also: 2003-257-1

Ottawa, 16 July 2003

  Bell ExpressVu Inc., the general partner, and BCE Inc. and 4119649 Canada Inc. (Partners in BCE Holdings G.P.), the limited partners, carrying on business as Bell ExpressVu Limited Partnership
Across Canada
  Application 2002-0653-3
Broadcasting Public Notice CRTC 2002-57
4 October 2002
 

Licence amendment for ExpressVu - relief from requirements for simultaneous and non-simultaneous program deletion

  The Commission approves in part the application for a licence amendment that would relieve this direct-to-home broadcasting distribution undertaking licensee of its condition-of-licence obligations for performing simultaneous and non-simultaneous program deletion. The licensee is relieved of these condition-of-licence obligations until 12 August 2006 so long as it fulfils the alternative measures set out in this decision.
 

Background

1.

There are currently two direct-to-home (DTH) broadcasting distribution undertakings (BDUs) that operate on a national basis to deliver a broad range of programming services directly via satellite to subscribers. One of these, the applicant, is Bell ExpressVu Inc., the general partner, and BCE Inc. and 4119649 Canada Inc. (Partners in BCE Holdings G.P.), the limited partners. The licensee carries on business as Bell ExpressVu Limited Partnership (ExpressVu). The second national DTH BDU is Star Choice Television Network Incorporated (Star Choice).

2.

In the fall of 2001, in response to concerns expressed by small market television broadcasters related to the impact of the distribution of optional local television signals by DTH BDUs, the Commission issued Call for comments - Carriage of local television stations by DTH undertakings in smaller markets, Public Notice CRTC 2001-103, 28 September 2001 (Public Notice 2001-103).

3.

In August 2002, while the Commission's deliberations were still ongoing with respect to the process initiated by Public Notice 2001-103, ExpressVu applied for a licence amendment to suspend conditions of licence that require it to perform simultaneous and non-simultaneous program deletion. The application was filed pursuant to a Memorandum of Understanding (MOU) between the licensee and the Canadian Association of Broadcasters (CAB) concerning measures that would serve as an alternative to the simultaneous and non-simultaneous program deletion requirements of its licence. The MOU forms part of ExpressVu's application.

4.

A similar application for relief from its requirements for simultaneous and non-simultaneous program deletion was filed in the fall of 2002 by Star Choice.

5.

In Broadcasting Public Notices CRTC 2002-57, 4 October 2002 (Public Notice 2002-57), and 2002-71, 19 November 2002 (Public Notice 2002-71), respectively, the Commission invited public comments with respect to the ExpressVu and the Star Choice applications. In their applications, the licensees of the two DTH BDUs had argued that their proposals: a) responded fully to the concerns of small market television broadcasters regarding the distribution of optional local television signals; and b) provided adequate, alternative measures to compensate for the impact of the importation by DTH BDUs of distant Canadian and non-Canadian signals into local markets. Accordingly, the Commission determined to examine the matters raised in each of the applications in the context of its consideration of the concerns that were the subject of Public Notice 2001-103.

6.

In Direct-to-home (DTH) broadcasting distribution undertakings - simultaneous and non-simultaneous program deletion and the carriage of local television signals in smaller markets, Broadcasting Public Notice CRTC 2003-37, 16 July 2003 (Public Notice 2003-37), the Commission has announced its conclusions with respect to the issues raised in Public Notice 2001-103 and in the two DTH BDU applications. Public Notice 2003-37 serves as the introduction to this decision on ExpressVu's application and to the decision on the application by Star Choice (for the latter, see Licence amendment for Star Choice - relief from requirements for simultaneous and non-simultaneous program deletion, Decision CRTC 2003-258, 16 July 2003).

7.

The Commission's disposition of the ExpressVu application is set out below.
 

Commission's determinations on ExpressVu's application

8.

For the reasons set out in Public Notice 2003-37, by majority vote, the Commission approves in part ExpressVu's application for a licence amendment that would relieve it of its condition-of-licence program-deletion obligations for performing simultaneous and non-simultaneous program deletion, so long as the licensee fulfils the alternative measures set out in this decision.

9.

Express Vu's existing condition of licence 4 reads, in part:
 

4. The licensee is required to adhere to the following, unless otherwise authorized by the Commission:

.

 

b) the licensee shall delete programming received by subscribers located within the Grade B contour of a licensed Canadian television programming undertaking, where the programming distributed as part of the DTH undertaking is identical to the programming broadcast by the Canadian television programming undertaking;

 

c) the licensee shall delete programming received by subscribers located within the grade B contour of licensed Canadian television programming undertakings where the programming distributed as part of its service is identical (i.e. in relation to the above-mentioned programming, not less than 95 percent of the video and audio components of those programming services, exclusive of commercial messages and any part of the services carried on a subsidiary signal are the same) to the programming broadcast by the Canadian television programming undertaking and is distributed on a non-simultaneous basis within the same broadcast week;.

 

d) . For the purposes of paragraphs a) and b) of this condition, the term "identical" shall have the same meaning as that contained in subsection 2(1) of the cable regulations, the term "commercial message" shall have the same meaning as that contained in the cable regulations and the term "broadcast week" shall mean a period of seven consecutive days, beginning on Sunday.

 

e) The application of the conditions of licence specified in 4(b) and 4(c) will be suspended from the date of this decision until the earlier of 30 August 2000 and the date upon which the DTH satellite distribution undertaking obtains 500,000 subscribers.

10.

For the reasons provided in Public Notice 2003-37, the Commission is satisfied that the MOU, as amended on 25 September 2002, and the licensee's agreement with CTV with respect to the distribution of unduplicated CTV programming from out-of-market CTV affiliates, are appropriate as part of a set of measures constituting an alternative to the applicant's existing program deletion conditions of licence. As discussed in Public Notice 2003-37, however, the Commission considers unnecessary those provisions contained in the MOU relating to limitations on the distribution of signals from earlier time zones, and the non-simultaneous substitution of Canadian television signals. Nor does the Commission consider appropriate the provisions of the MOU related to the proposed programming fund. Accordingly, the Commission will relieve the licensee of the application of conditions of licence 4(b) and 4(c) provided that it:
 

· fulfils the obligations that it agreed to in its 12 August 2002 MOU with the CAB, as subsequently amended, other than those related to the proposed programming fund, the proposal to limit the distribution of signals from earlier time zones and the proposal for non-simultaneous substitution for Canadian television signals; and

 

· contributes, annually, not less than 0.4% of its gross revenues derived from broadcasting activities to a new, independently administered fund to assist small market, independently owned broadcasters in meeting their commitments to local programming.

11.

The Schedule to this decision sets out those obligations that the licensee agreed to fulfil in its 12 August 2002 MOU with the CAB, as subsequently amended, and that the Commission considers appropriate as part of a set of measures constituting an alternative to the applicant's existing program deletion conditions of licence. The measures are set out in the Schedule so that it is clear that, from the date of this decision, the licensee will be relieved of the program deletion conditions of its licence provided that it fulfils all those measures, and so that it is equally clear that the suspension of these conditions of licence is not dependent upon the MOU continuing to be in effect or upon whether any contractual requirements prior to the date of this decision were fulfilled.

12.

Accordingly, the Commission hereby amends the licence by deleting paragraph (e) of condition of licence 4 and substituting the following therefor:
 

e) The application of the conditions of licence specified in 4(b) and 4(c) will be suspended, from the date of this decision until 12 August 2006, so long as the licensee:

 

(i) fulfils all of the measures set out in the Schedule that is appended to this decision; and

 

(ii) contributes the amount set out below to a new, independently administered fund to assist small market, independently owned broadcasters in meeting their commitments to local programming as set out in Contributions to Canadian Programming by Broadcasting Distribution Undertakings, Broadcasting Public Notice CRTC 2003-38, 16 July 2003 when such a fund is established and, before such time, places the required contribution in trust in an interest-bearing account, to be conveyed with interest to such fund when it is established:

 

I. in the broadcast year ending on 31 August 2003, an amount not less than 0.4% of its gross revenues derived from broadcasting activities in the period beginning on the 16 July 2003 and ending on 31 August 2003;

 

II. in the broadcast years ending on 31 August 2004 and on 31 August 2005, an amount not less than 0.4% of its gross revenues derived from broadcasting activities in each year; and

 

III. in the period ending on 12 August 2006, an amount not less than 0.4% of its gross revenues derived from broadcasting activities in the period beginning 1 September 2005 and ending on 12 August 2006.

  Secretary General
  This decision is to be appended to the licence. It is available in alternative format upon request, and may also be examined at the following Internet site: http://crtc.gc.ca
 

Schedule to Broadcasting Decision CRTC 2003-257

 

Definitions

  "Broadcast year" means the period beginning on September 1 in a calendar year and ending on August 31 of the following calendar year.
  "CAB" means the Canadian Association of Broadcasters.
  "CBC" means the Canadian Broadcasting Corporation.
  "Larger broadcast groups" means those television groups listed in Appendix B to this Schedule.
  "Second set of U.S. commercial network television signals" means the signals of each of the CBS, NBC, ABC and Fox networks originating from a U.S. city in a different time zone than that of the first set of U.S. commercial network signals.
  "Small market, independently owned television stations" means those television stations listed in Appendix A to this Schedule.
  "SRC" means La Société Radio-Canada.
  "Subscriber" means a subscriber of the licensee.
 

Distribution of small market, independently owned television stations

 

1. (a) Subject to sections 5 and 7, the licensee shall distribute the programming services of two (2) television stations for each of the ownership groups listed in Appendix A, except that, in the case of an ownership group for which Appendix A lists a single television station, the licensee shall distribute the programming of that station. Each station required to be distributed pursuant to this section shall be distributed to those subscribers who reside within the Grade B contour of that television station.

 

(b) The licensee shall not distribute to subscribers who reside within the Grade B contours of the television stations referred to in (a) above, the programming services of licensed Canadian television stations that are located within the same time zone and are affiliated with the same network as those stations whose programming services are distributed pursuant to (a). This prohibition shall not apply with respect to the programming services of television stations owned and operated by the CBC, SRC or CTV during periods in which the programming of those stations is not comparable to the programming transmitted simultaneously by a local small market, independently owned station affiliated with the CBC, SRC or CTV.

 

Distribution of television stations owned by larger broadcast groups

 

2. Subject to section 5, the licensee shall provide equitable distribution for the television stations of the broadcast groups listed in Appendix B (the larger broadcast groups).

 

Input from broadcast ownership groups

 

3. The licensee shall give reasonable commercial consideration to input from affected broadcast ownership groups respecting the programming services to be distributed pursuant to sections 1 and 2.

 

Distribution of a second set of U.S. commercial network television signals

 

4. a) The licensee shall not distribute to any subscriber more than two sets of U.S. commercial network television signals.

 

b) The licensee shall provide notification to the CAB 90 days prior to any change in the location of the source of any U.S. commercial network television signals it distributes.

 

Satellite capacity and transmission

 

5. The licensee shall utilize up to a maximum of two (2) additional transponders in order to meet the distribution requirements set out in sections 1 and 2. The licensee shall be responsible for all transmission costs including backhaul costs associated with the distribution of television signals referred to in sections 1 and 2. Where the licensee is able to meet all distribution requirements set out in sections 1 and 2, and where there remains excess bandwidth within the limits of the two (2) additional transponders, the licensee shall use such additional capacity solely for the carriage of Canadian local or regional television stations.

 

Compensation for the carriage of a second set of U.S. network television signals

 

6. a) The licensee shall pay to the CAB $0.25 per month for each subscriber who purchases a second set of U.S. network television signals.

 

b) The licensee shall provide to a third party independent auditor who has been chosen by the CAB in consultation with the licensee, and who has undertaken, in an agreement approved by the licensee prior to execution, to keep all information received pursuant to this section strictly confidential, on a semi-annual basis during the broadcast year starting 1 September 2002 and ending 31 August of the following year and of all subsequent broadcast years, all necessary relevant information as to the number of subscribers receiving a second set of U.S. network television signals in order to verify and facilitate the payment by the licensee to the CAB of the monies due pursuant to this section.

 

Change of control of small market, independently owned television stations

 

7. The distribution requirements set out in section 1 shall continue to apply independent of changes in the ownership of voting equity by the ownership groups listed in Appendix A, except where a change in voting equity results in a change in control of voting equity in accordance with Commission regulations, and also involves a change in the network affiliation and/or a material change in the programming of any subject station. In the case of a change in control that also involves a change in network affiliation and/or a material change in programming with respect to a station listed in Appendix A, the licensee's distribution requirements pursuant to section 1 shall cease with respect to that station upon notification of such a change from the CAB or an authorized representative of that station. Furthermore, any change in control of voting equity of any station listed in Appendix A shall not trigger any additional distribution of programming services of television stations operated by the larger broadcast ownership groups pursuant to section 2.

 

Appendix A

 

Small market, independently owned television stations by ownership group

Ownership group

Station

Jim Pattison Industries Ltd.

 

CHAT-TV Medicine Hat
CFJC-TV Kamloops
CKPG-TV Prince George
Mid West Television Ltd.

 

CKSA-TV Lloydminster
CITL-TV Lloydminster
Norcom Telecommunications Limited CJBN-TV Kenora
Radio Nord Communications inc.

 

CFGS-TV Gatineau
CHOT-TV Gatineau
CKRN-TV Rouyn-Noranda
CFEM-TV Rouyn-Noranda
CFVS-TV Val d'Or
Télé Inter-Rives ltée

 

CIMT-TV Rivière-du-Loup
CFTF-TV Rivière-du-Loup
CKRT-TV Rivière-du-Loup
CHAU-TV Carleton
Standard Radio Inc.

 

CFTK-TV Terrace
CJDC-TV Dawson Creek
Thunder Bay Electronics

Limited

CKPR-TV Thunder Bay
CHFD-TV Thunder Bay
 

Appendix B

 

Ownership Groups

 

Bell Globemedia Inc. (CTV)
CanWest Media Inc. (Global)
CHUM Limited
Cogeco Radio-Télévision inc. (TQS)
Quebecor Media Inc. (TVA)
Craig Media Inc.
Corus Entertainment Inc.
Rogers Media Inc.

Date Modified: 2003-07-16

Date modified: