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Ottawa, 14 March 1986
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Decision CRTC 86-219
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Maclean-Hunter Limited, operating under the name of Maclean-Hunter Cable TV
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Thunder Bay, Ontario - 852445600
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At a Public Hearing held in Toronto on 16 December 1985, the Commission considered an application by Maclean-Hunter Limited (Maclean-Hunter) to change the authorized distribution of the broadcasting receiving undertaking serving Thunder Bay by substituting the carriage of the 3+1 U.S. television network signals, received via satellite from the Canadian Satellite Communications Inc. (CANCOM) network, for those received over-the-air.
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Maclean-Hunter indicated that the signals of WDIO-TV (ABC), KDLH-TV (CBS), KBJR-TV (NBC) and WDSE-TV (PBS), which are received over-theair from Duluth, are of poor quality and subject to co-channel interference and fading, particularly during the summer months, and that several complaints had been received from subscribers in this regard.
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At the hearing, Maclean-Hunter advised the Commission that a study conducted by the Department of Communications in 1983 had concluded that it was certainly not the equipment that was causing the problem, but rather the method of delivery, "whereby the first receiving site for the Duluth stations was established at Grand Marais, Minnesota. The signals received at this ... site were retransmitted by low-power UHF translators to Grand Portage, Minnesota and then again retransmitted on different UHF channels". As a result, these American signals are relayed over a total distance of some 190 miles.
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Maclean-Hunter added that, in 1983, it had commissioned the operator of KDLH-TV, the Duluth CBS station, to conduct a microwave feasibility study and that, until last year, it had been trying to negotiate an agreement with the Duluth broadcasters for the construction and operation of a microwave system to improve the technical quality of the Duluth signals in Thunder Bay, but it had not been able to arrive at a satisfactory long-term arrangement.
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It also indicated that it had concluded a 15-year fixed-rate agreement with CANCOM for the satellite delivery of more reliable, better quality signals at comparable cost.
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Mr. George C. Jauss of the Duluth-Superior Area Educational Television Corporation submitted an intervention on behalf of the four Duluth U.S. television stations opposing the deletion of their signals and underlining the affinity that exists between the communities of Duluth and Thunder Bay.
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At the hearing, Mr. Jauss stated that "the three commercial television stations have provided regional news, sports, weather, and feature programming of interest to all the people of the Western Lake Superior Region" in addition to the educational and cultural programs of WDSE-TV (PBS), which is watched at least once a month by half the residents of
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Thunder Bay. The intervener also pointed out that the U.S. stations had recently proposed to revise their offer of financial assistance for the initial establishment of the microwave system and indicated that they, too, were willing to provide a 15-year maintenance agreement.
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In its reply, the licensee commented on the community of interest argument noting that it was more like "a one-way communications path" between the two cities, and stressed that the microwave feasibility study results indicated that satellite delivery was both more cost efficient and more reliable. Maclean-Hunter added that subscribers are not interested in the Duluth stations' local or regional programs, particularly their newscasts. Further, it noted, that the offer to contribute to the installation of the microwave system "came only after our contract with CANCOM was signed and this application was filed".
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Opposing interventions were received from L. Ardis Hunter, John Moorhead and Ernie Epp, M.P., expressing interest in having the Duluth stations maintained.
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The Commission also acknowledges the intervention submitted by the CTV Television Network Ltd. (CTV) regarding the importation by Canadian satellite of distant U.S. signals, potential loss of revenue for Canadian stations, breach of copyright, duplication of prime time programming and the ineffectiveness of simulcasting. In the Commission's view, the concerns raised by CTV have already been considered and addressed in a number of previous decisions, including Decision CRTC 83-126 which authorized CANCOM to distribute the 3+1 U.S. signals, and Decision CRTC 85-423 renewing CANCOM's licence. Decisions CRTC 86-183 and 86-184 dated 6 March 1986, which authorized several Manitoba cable licensees to replace two U.S. network signals from North Dakota with the corresponding signals received from CANCOM, also address some of the CTV concerns.
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Thunder Bay Electronics Limited, licensee of CHFD-TV Thunder Bay, the local CTV affiliate, The Ontario Educational Communications Authority (TV Ontario) and the Canadian Motion Picture Distributors Association raised other related matters in their interventions. Thunder Bay Electronics Limited also indicated that the issue of the close community of interest between Thunder Bay and Duluth was absent from the Maclean-Hunter application.
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Furthermore, the Municipality of Neebing and the Township of O'Connor, which also represented the Local Services Board of Pearson Township, urged in their interventions that provisions be made to maintain the Grand Portage transmitter should the proposal to replace the Duluth signals be approved. Mr. Vic Corbeil, Michael Samorodny, Michael Ludwig-Mawer and CANCOM also submitted interventions in support of the Maclean-Hunter proposal.
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The Commission has examined carefully all the evidence submitted by the licensee and the interveners, including the evidence related to the technical quality of the signals. The Commission is satisfied that the licensee has adequately met the criteria set out in Public Notice CRTC 1985-60, and that, under the particular circumstances of this case, satellite signal delivery represents the most cost efficient and technically reliable means of providing high quality U.S. signals to Thunder Bay.
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Accordingly, by majority decision, the Commission approves the addition of the signals of WXYZ-TV (ABC), WJBK-TV (CBS), WTVS (PBS) and WDIV (NBC) Detroit, Michigan, received via satellite from the CANCOM network and the deletion of the signals of WDIO-TV (ABC), KDLH-TV (CBS), KBJR-TV (NBC) and WDSE-TV (PBS) Duluth, Minnesota, received over-the-air.
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The Commission also approves an amendment to the licence for this undertaking by increasing the maximum monthly subscriber fee from $9.00 to $9.40. The $0.40 fee increase is justified based on the difference between the additional costs to be incurred for the delivery of the CANCOM signals and the deletion of the maintenance costs associated with the over-the-air reception of U.S. signals.
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The Commission notes that the maximum monthly subscriber fee authorized herein includes pass-through fees of $0.61 to be paid by the licensee to CANCOM for the delivery of four television signals. Authority to charge the $9.40 will only be effective at such time as the CANCOM signals are provided to subscribers and is further subject to the requirement that only the actual pass-through fees paid to CANCOM are charged to subscribers.
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DISSENTING OPINION FROM COMMISSIONER PAUL MCRAE
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This dissension from the decision is based on two points raised during the hearing.
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1) There is a very close relationship between the cities of Duluth and Thunder Bay. This is illustrated by three quotations from Ms. Labelle of Thunder Bay Electronics Limited: "The central issue conspicuous by its absence in the Maclean-Hunter application ... is the community of interest which exists between Thunder Bay and Duluth-Superior"; "One has only to consider that it is a full day's journey from Thunder Bay to the nearest Canadian city, while it is a 30-minute drive to the U.S. border, to understand why a tremendous spirit of kinship and competition has flourished between the two cities"; and "Your press clippings already tell you that the possibility of losing this media connection between the two cities sparked an emotional debate on both city councils. But without giving an exhaustive list of shared interests, we respectfully submit that community of interest is of critical consideration in this application".
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2) Interventions by one individual, the Township of O'Connor, the Municipality of Neebing and the Local Services Board of Pearson Township, indicate that a real concern exists that the over-the-air service received could result in the loss or deterioration of over-the-air signals to "at least 2,000 households". Certainly these signals would improve if the microwave option was pursued.
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Given these two points, and the very marginal cost differences, the application, I believe, should be denied, and further, the applicant should be directed to review again an earlier proposal to improve, by microwave, the existing signals from Duluth.
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Fernand Bélisle
Secretary General
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