ARCHIVED - Decision CRTC 2001-732

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Decision CRTC 2001-732

Ottawa, 29 November 2001

Astral Broadcasting Group Inc. (formerly Astral Television Networks Inc.)
Ontario, Quebec and Atlantic provinces (Eastern Canada) 2001-0217-9

19 June 2001 Public Hearing
National Capital Region

Licence renewal for The Movie Network

The licence for "The Movie Network" is renewed for a full term. The licensee's condition of licence on Canadian programming expenditures will continue to link its requirements to subscriber levels, which will now also take into account direct-to-home (DTH) satellite subscribers. For the purpose of this condition, the definition of revenues will include monies derived from DTH satellite subscribers to the service and any return on investment in programming.

1.

The Commission renews the broadcasting licence issued to Astral Television Networks Inc. for the regional English-language pay television service known as "The Movie Network", from 1 December 2001 to 31 August 2008, subject to the conditions specified in the appendix to this decision and in the licence to be issued.

2.

The Commission has no concerns with respect to the licensee's compliance with its conditions of licence during the current licence term.

3.

The Commission also notes that on 1 September 2001, Astral Television Networks Inc. merged with Astral Broadcasting Group Inc., now the licensee of The Movie Network.

Expenditures on Canadian programming

4.

Under its current condition, the licensee's requirements for expenditures on Canadian programming are based on the average number of subscribers in the previous broadcast year, excluding direct-to-home (DTH) satellite subscribers. In its licence renewal application, the licensee originally proposed to establish a fixed requirement to allocate 20% of its revenues to Canadian programming expenditures. This level is lower than what the licensee currently must spend. The licensee also asked the Commission to revise the definition of revenues to include monies derived from the distribution of its service by DTH satellite services and any return on investment in programming.

5.

In interventions to this application, a number of parties, including the Directors Guild of Canada, the Alberta Motion Picture Industries Association, the Canadian Film and Television Production Association and The Writers Guild of Canada argued that the licensee's required expenditures on Canadian programming should continue to be linked to subscriber levels.

6.

In response, the licensee stated that, during the new licence term, it was prepared to maintain the current subscriber-based formula for Canadian programming expenditures, but take DTH satellite subscribers and revenues as well as any return on investment in programming into consideration when calculating its requirements.

7.

In accordance with the licensee's request, the Commission has amended the licensee's condition of licence to include DTH satellite subscribers and revenues and any return on investment in programming. The satellite revised condition (set out in the appendix) will significantly increase the level of the licensee's expenditures on Canadian programming.

Script and concept development

8.

The licensee made a commitment to increase its spending on script and concept development to not less than $1,300,000 in each broadcast year for a minimum of $9.1 million over the licence term. A condition of licence in this regard is found in the appendix.

9.

As part of this commitment, the licensee will contribute $300,000 to a new fund, "Astral Media Story Optioning Program for Film."

Rebranding of services

10.

The Commission notes that Astral and certain other pay television licensees have adopted a thematic approach in programming the multiplexed channel feeds they make available to distributors. The Commission has no concerns about this approach provided the programming offered on each channel meets the Canadian content requirements for the service. Further, individual channels must not be offered on a stand-alone basis (i.e. the licensee and its distribution affiliates must ensure that all of the multiplexed channel feeds that make up the service are distributed to subscribers within a package).

11.

As discussed with the licensee, these two requirements are stipulated in the conditions of licence set out in the appendix to this decision.

Cultural diversity

12.

The Commission expects The Movie Network, and all other specialty and pay television licensees, to contribute to a broadcasting system that accurately reflects the presence in Canada of cultural and racial minorities and Aboriginal peoples. The Commission further expects licensees to ensure that their on-screen portrayal of all such groups is accurate, fair and free of stereotypes. These expectations are fully in keeping with section 3 (1)(d)(iii) of the Broadcasting Act, which states that the Canadian broadcasting system should, "through its programming and the employment opportunities arising out of its operations, serve the needs and interests, and reflect the circumstances and aspirations, of Canadian men, women and children, including equal rights, the linguistic duality and multicultural and multiracial nature of Canadian society and the special place of Aboriginal peoples within that society."

13.

In Public Notice CRTC 2001-88, Representation of cultural diversity on television - Creation of an industry/community task force, the Commission called upon the Canadian Association of Broadcasters to develop an action plan for a joint industry/community task force. The role of this task force is to sponsor research, identify "best practices", and help define the issues and present practical solutions to ensure that the Canadian broadcasting system reflects all Canadians. In its notice, the Commission emphasized the importance of having the participation of all sectors of the broadcasting industry, including pay television services. The Commission therefore expects Astral to contribute to the work of the task force.

14.

The Commission further expects the licensee to develop and implement a comprehensive corporate plan that explains how Astral intends to improve its representation of Canada's cultural diversity and to file this plan with the Commission within three months of the date of this decision. The plan should include specific commitments to corporate accountability and to the reflection of diversity in programming, and should make provision for the gathering of feedback on the effectiveness of these commitments. The plan should also set goals for achieving the full, fair and consistent reflection of diversity in Canada.

15.

With respect to corporate accountability, the plan should address how Astral will create an environment that supports the cultural diversity objectives outlined above, by:

· creating a corporate culture that recognizes and supports Canada's cultural diversity;
· assigning accountability to a senior executive for corporate practices related to cultural diversity, and for ensuring that management becomes more reflective of Canada's multicultural reality;
· ensuring that managers receive proper training;
· ensuring that regular opportunities are provided for assessing progress towards attaining these objectives and for identifying future opportunities and challenges; and
· setting out plans for the hiring, retention and ongoing training of visible minorities and Aboriginal peoples.

16.

With respect to the reflection of diversity in programming, the plan should focus on how the licensee will ensure the presence and the fair, accurate and non-stereotypical portrayal of cultural minorities and Aboriginal peoples in the programming it produces or acquires. Specifically, the plan should include provisions for making certain that, wherever possible:

· on-air personalities reflect Canada's diversity; and

· programming obtained from independent producers reflects the presence of visible minorities and Aboriginal peoples in Canadian society and provides for their accurate portrayal.

17.

As for feedback, the corporate plan should describe the specific mechanisms the licensee will put in place to ensure that it receives effective input from community groups concerning its performance in reflecting cultural diversity in programming.

On-air presence

18.

The Commission reminds the licensee that the expectations set out above with respect to cultural diversity are over and above the longstanding and more general expectations concerning employment equity in on-air presence. Specifically, the Commission expects the licensee to ensure that the on-air presence of members of the four designated groups (women, Aboriginal persons, disabled persons and members of visible minorities) is reflective of Canadian society, and that members of these groups are presented fairly and accurately.

Closed captioning

19.

The Commission is committed to improving service to television viewers who are deaf or hearing impaired. Over the period since the Commission announced its policy on closed captioning in Public Notice CRTC 1995-48, it has consistently encouraged broadcasters to increase the amount of captioned programming they provide. The Commission now requires the licensees of television, specialty and pay television undertakings to achieve a minimum level of captioned programming appropriate to the nature of the service that each provides. Generally, the specified minimum requirement is 90% of all programming.

20.

In the case of The Movie Network, the licensee stated that it was already captioning 90% of all its programming.

21.

Consistent with its policy approach described above and with the licensee's commitment, the Commission has decided to require the licensee, by condition of licence, to maintain a minimum captioning level of 90% for all programming aired during the broadcast year throughout the licence term.

22.

The 90% obligation is based on the recognition that requiring 100% captioning at all times may not be reasonable or appropriate. Thus, the obligation is designed to provide some flexibility to cover unforeseen circumstances (such as late delivery of captions, technical malfunctions, or the lack of availability of captions for programs acquired outside North America), or programming where captioning may not be feasible, such as third language programming.

23.

The Commission expects the licensee to focus on improving the quality, reliability and accuracy of closed captioning, and to work with representatives of the deaf and hard of hearing community to ensure that captioning continues to meet their needs.

Service to the visually impaired

24.

In decisions issued last December, the Commission encouraged the licensees of new Category 1 specialty services, over their licence terms, to provide increasing amounts of programming accompanied by audio or video description. More recently, in decisions issued in the summer of this year renewing the licences for the television stations owned by Global, CTV and TVA, the Commission imposed conditions of licence regarding the provision of increasing amounts of such programming.

25.

"Audio description" and "video description" or "described video" are methods of improving the service that television broadcasters provide to people who are visually impaired. Audio description involves the provision of basic voice-overs of textual or graphic information displayed on the screen. A broadcaster providing audio description will, for example, not simply display sports scores on the screen, but also read them aloud so that people who are visually impaired can receive the information.

26.

Video description, or described video as it is also known, consists of narrative descriptions of a program's key visual elements so that people who are visually impaired are able to form a mental picture of what is occurring on the screen. These descriptions can be provided on the Secondary Audio Programming (SAP) channel. Not all broadcasters are currently equipped to deliver a SAP signal. Thus, the introduction of described video via the SAP channel could require significant capital expenditures to upgrade a licensee's transmission facilities.

27.

The Commission notes the increasing amount of described programming available for acquisition, particularly from U.S. sources. It notes as well the encouragement given to the operators of the new Category 1 specialty services and the requirements it has placed on the television stations operated by Global, CTV and TVA concerning the provision of such programming. In correspondence with The Movie Network, the Commission requested the licensee's views on implementing audio description, video description or described video. The Commission considers it reasonable to expect the operators of the pay and specialty services whose licences are being renewed at this time to take steps to respond to the needs of viewers who are visually impaired.

28.

Accordingly, the Commission expects the licensee to:

· provide audio description (defined as the provision of basic voice-overs of textual or graphic information displayed on screen) wherever appropriate;
· undertake the necessary upgrades to permit the broadcast of described programming (for example, via the SAP channel);
· acquire and broadcast the described versions of a program wherever possible; and
· take the necessary steps to ensure that its customer service responds to the needs of visually impaired viewers.

29.

In addition, and consistent with the approach adopted for the new Category 1 services, the Commission encourages the licensee to provide, at a minimum, one hour per month of described programming in the period between 1 December 2001 and 31 August 2002, and to increase this monthly minimum by at least one hour in each subsequent broadcast year of the new licence term.

Distribution

30.

In Decision CRTC 98-2, the Commission authorized The Movie Network to provide its programming service to Igloolik, Hall Beach, Pond Inlet, Arctic Bay, Resolute Bay and Grise Fiord, Northwest Territories, until such time as SuperChannel was able to re-establish service to these locations. Athough these communities are within the service area licensed to SuperChannel, technical changes made its service unreceivable in these locations at that time. SuperChannel has indicated that its service can now be received in these communities. Accordingly, as stated in Decision CRTC 98-2, The Movie Network's authorization to provide service to these communities ceases 30 November 2001.

Compliance with industry codes

31.

In accordance with its usual practice, the Commission is imposing on the licensee conditions of licence requiring that it adhere to the industry codes related to violence in television programming and sex role portrayal. Application of the sex role code portrayal will be suspended so long as the licensee remains a member in good standing of the Canadian Broadcast Standards Council. In addition, by condition of licence, the licensee must adhere to the Pay television programming standards and practices code.

Interventions

32.

The Commission acknowledges all of the interventions submitted with regard to this application and has noted the licensee's response to the concerns expressed in some submissions.

Related CRTC documents

. Decision 2001-166 - Three-month administrative renewal for The Movie Network
. Decision 95-739 - Licence amendment
. Decision 95-68 - Licence renewal for The Movie Network

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: www.crtc.gc.ca

 

 

Appendix to Decision CRTC 2001-732

 

Conditions of licence for The Movie Network

  Nature of service
  1.(a) The licensee shall provide a regional English-language general interest pay television programming undertaking in Ontario, Quebec and the Atlantic provinces (eastern Canada), with programming intended for all audiences.
  (b) The licensee shall distribute programming from all categories of programming set out in item 6 of Schedule I to the Pay Television Regulations, 1990, withthe exception of programming from categories 1 (news), 4 (religion), 5a (formal education and pre-school), 5b (informal education/recreation and leisure) and 14 (infomercials, promotional and corporate videos).
  (c) The licensee shall not devote more than 5% of its programming schedule during each semester to programming from category 6 (sports), with a maximum of 20 hours in any week.
  (d) The licensee shall devote at least 50% of its programming schedule during each semester to dramatic programs.
 

Exhibition of Canadian programs

  2. In each semester of the licence term, the licensee shall devote to the distribution of Canadian programs not less than:
 

(a) 30% of the time from 6:00 p.m. to 11:00 p.m. (Eastern time) and

 

(b) 25% of the remainder of the time during which the service is in operation.

  For the purpose of this condition, a 150% credit will be given for time during which the licensee distributes a new Canadian production that commences between 6:00 p.m. and 11:00 p.m. (Eastern time) or, in the case of a new Canadian production intended for children, at an appropriate viewing hour between 6:00 a.m. to 9:00 p.m., and the licensee will receive such a credit for each subsequent showing in the specified time periods of such a production within a two-year period from the date of first showing by the licensee.
  3. In each broadcast year during the term of this licence, the licensee shall devote to the distribution of Canadian dramatic programs not less than 50% of the time that it is required to devote to the distribution of Canadian programs.
 

Expenditures on Canadian programs

  4. (a) During the period 1 December 2001 to 31 August 2002, the licensee shall expend, on the acquisition or investment in Canadian programming, a percentage that is not less than the percentage shown in the table below, of 75%* of its revenues for the broadcast year ending 31 August 2001. For the broadcast year beginning 1 September 2002 and in each subsequent broadcast year during the term of this licence, the licensee shall expend, on the acquisition of or investment in Canadian programs, a percentage of its revenue for the previous broadcast year that is not less than the percentage shown in the table below:
 

Average number of subscribers in the previous broadcast year: residential and bulk cable, satellite master antenna television (SMATV) and direct-to-home (DTH) satellite

Percentage of revenues

 

459,999 or less

22%

 

460,000 - 499,999

23%

 

500,000 - 539,999

24%

 

540,000 - 579,999

25%

 

580,000 - 619,999

26%

 

620,000 - 659,999

27%

 

660,000 - 699,999

28%

 

700,000 - 739,999

29%

 

740,000 - 779,999

30%

 

780,000 - 819,999

31%

 

820,000 and greater

32%

  (b) In any broadcast year of the licence term, including the partial broadcast year ending 31 August 2002 but excluding the final broadcast year, the licensee may expend an amount on Canadian programming that is up to 5% less than the minimum required expenditure for that broadcast year, as set out and calculated in accordance with this condition of licence.
  (c) Should the licensee avail itself of this flexibility in any broadcast year including the partial broadcast year ending 31 August 2002, it shall expend in the next broadcast year of the licence term, in addition to the minimum required expenditure for that broadcast year, the full amount of the previous broadcast year's underspending.
  (d) In any broadcast year of the licence term, including the partial broadcast year ending 31 August 2002, the licensee may expend an amount on Canadian programming that is greater than the minimum required expenditure for that broadcast year as set out and calculated in accordance with this condition of licence; in such case, the licensee may deduct:
 

(i) from the minimum required expenditure for the next broadcast year of the licence term, an amount not exceeding the amount of the previous broadcast year's overspending; and

 

(ii) from the minimum required expenditure for any subsequent broadcast year of the licence term, an amount not exceeding the difference between the overspending and any amount deducted under paragraph (i) above.

  (e) Notwithstanding the above, during the licence term, the licensee shall expend on Canadian programming, at a minimum, the total of the minimum required expenditures as set out and calculated in accordance with this condition of licence.
  5. During the licence term, the licensee shall devote to the acquisition of Canadian programs not less than 60% of its expenditures on the acquisition of or investment in Canadian programs. The required expenditure is calculated pursuant to condition of licence 4.
  6. In each broadcast year during the term of this licence, including the partial broadcast year ending 31 August 2002, the licensee shall allocate to Canadian dramatic programs at least 50% of its expenditures on the acquisition of or investment in Canadian programs for that year.
  7. The licensee shall expend on script and concept development, including bursaries for writers, excluding overhead costs, not less than $1,300,000 in each broadcast year for a minimum of $9,100,000 over the licence term.
  8. In making the calculations required for the purposes of conditions 4 to 7, only actual cash outlays shall be taken into account.
 

Multiplex channels

  9. The licensee shall offer its multiplexed channels only together in a package.
  10. With respect to each multiplexed channel, the licensee shall adhere to the Canadian programming requirements set out in conditions of licence 2 and 3.
 

Closed captioning

  11. The licensee shall achieve a minimum captioning level of 90% for all programming aired during the broadcast year throughout the licence term.
 

Industry codes

  12. The licensee shall adhere to the guidelines on gender portrayal set out in the Canadian Association of Broadcasters' (CAB) Sex-role portrayal code for television and radio programming, as amended from time to time and approved by the Commission. The application of the foregoing condition of licence will be suspended as long as the licensee remains a member in good standing of the Canadian Broadcast Standards Council.
  13. The licensee shall adhere to the Pay television and pay-per-view programming code regarding violence, as amended from time to time and approved by the Commission.
  14. The licensee shall adhere to the Pay television programming standards and practices code, as amended from time to time and approved by the Commission.
 

Definitions

 

In these conditions:

 

"broadcast year" means each twelve-month period beginning on 1 September in any year.

 

"expend" and expenditure means actual cash outlay.

 

"expend on acquisition" means

  (a) expend to acquire exhibition rights for the licensed territory, excluding overhead costs;
  (b) expend on script and concept development, excluding overhead costs; or
  (c) expend on the production of filler programming, as defined in section 2 of the Pay Television Regulations, 1990, including direct overhead costs; and
 

"expenditure on acquisition" has a comparable meaning.

 

"expend on investment" means expend for the purposes of an equity investment or an advance on account of an equity investment, but not overhead costs or interim financing by way of a loan; and

 

"expenditure on investment" has a comparable meaning.

 

"new Canadian production" means:

 

(a) a Canadian dramatic program

 

(i) which exceeds 75 minutes in duration and in relation to which all financial expenditures made by the licensee were made prior to the commencement of principal photography or taping and in which principal photography or taping was completed after 1 January 1985; and

 

(ii) which is intended for children and exceeds 22:30 minutes and in relation to which all financial expenditures made by the licensee were made prior to the completion of principal photography or taping

  (b) and which is a program that has never been broadcast in English in the licensed territory.
 

"revenue" means revenue from residential and bulk cable, SMATV and DTH satellite subscribers as well as any return on an investment in programming.

 

"script and concept development expenditures", means those expenditures excluding overhead costs, that are incurred prior to the commencement of pre-production and before the financing of the project is in place. Spending on programs that are assured of going to air at the time of the expenditure are not considered as script and development expenditures.

 

"semester" means each six-month period beginning on 1 September and 1 March.

 

_____________________________________
* 75% represents the 9-month period from 1 December 2001 to 31 August 2002.

Date Modified: 2001-11-29

Date modified: