ARCHIVED -  Public Notice CRTC 1985-61

Public Notice

Ottawa, 22 March 1985

Public Notice CRTC 1985-61

DISTANT CANADIAN TELEVISION SIGNALS

1. INTRODUCTION

At a public hearing in Hull, Quebec beginning on 27 November 1984, the Commission received a variety of submissions relating to the distribution of distant Canadian television signals. The hearing contributed in an important way to the Commission's policy review process, which began in January 1984 (Public Notice CRTC 1984-13) when the Commission invited comments on its proposal to reduce the existing restrictions on the cable carriage of distant Canadian broadcast signals noting that:

The increasing use of satellites for the delivery of Canadian and foreign programming and the expanding capacity of cable systems to distribute services offers a means to increase the programming choice available to Canadians. In such an environment, the distribution of existing Canadian signals beyond their licensed areas may be one of the means to ensure that the broadcasting system, as a whole, repredominantly Canadian.

As a result of requests for a public hearing contained in the comments received, the Commission decided to proceed to the 27 November 1984 hearing. Particularly it wished to afford television broadcasters a full opportunity to express their views so that any policy review would address their concerns. The hearing also provided an additional means of ensuring that all relevant information and empirical data was available to the Commission in its policy review.

2. THE POLICY REVIEW PROCESS

The reconsideration of the Commission's existing policy with respect to the distribution of distant Canadian signals has been an issue of on-going interest to the Commission for some time.

The policy was initially outlined in a Public Announcement dated 26 March 1979 entitled "A Review of Certain Cable Television Programming Issues". As iIn this announcement, the Commission identified some of the benefits to be gained from the extension of Canadian services, including increased program choice, a greater diversity of services, increased exposure for Canadian-originated programs and additional marketing potential for cable operators. At the same time, the Commission noted other potential consequences, including a possible reduction in advertising revenues for local stations which could constrain local broadcasters' capacity to develop quality programming. Consequently, the announcement reiterated the Commission's policy position at the time:

It is the Commission's opinion that the universal unrestricted authorization for the carriage of distant Canadian signals is not justified. The Commission will not permit the importation of distant Canadian stations microwave facilities, however, the Commission will continue the policy of selective authorization of distant carriage when justified in specific situations.

Since that time the Commission has approved the cable distribution of distant Canadian signals in a number of communities across Canada. In addition to those signals distributed by CANCOM via satellite to coremarket communities, distant Canadian signals are currently distributed via microwave in over fifty communities in Saskatchewan. TCTV is authorized for distribution in at least eighty communities outside Quebec and over twenty communities in Ontario receive distant signals. For example, the Global Television Network service is distributed via microwave in Windsor and a number of communities in Northern Ontario including Sudbury, Timmins, Hearst, Kapuskasing, Cochrane, Smooth Rock Falls, Iroquois Falls, Sturgeon Falls, Espanola, Blind River, Elliot Lake, North Bay, New Liskeard, Cobalt, Kirkland Lake and Kincardine.

The issue of the satellite distribution of distant Canadian signals was considered by the Committee on Extension of Service to Northern and Remote Communities and addressed in its July 1980 report entitled "The 1980s: A Decade of Diversity - Broadcasting, Satellites and Pay-TV" (The Therrien Report). The Committee examined some 400 briefs and had wide-ranging discussions with representatives of governments, municipalities, organizations and concerned citizens reflecting virtually every region of Canada, particularly those in remote, rural and underserved communities. On the basis of this extensive consultation, the Committee advanced the opinion that the potential loss of revenues by local broadcasters may not be as damaging as contend:

Everyone outside the more heavily populated areas wants more alternative programming, and the availability of a choice of programming is inseparable from some fragmentation of the audience. But the Committee is inclined to think that the resultant possible loss of revenue may not always be as damaging as the broadcasters contend. The Committee believes that the impact of any new service can be assessed only on a market-by-market basis, and that the burden of proof of damage should rest with the broadcaster(s) serving the market under consideration.

The possibility of a wider distribution of Canadian television signals surfaced again in the Commision's policy statement relating to cable television service tiering in 1984 where the Commission announced it would initiate a policy review.

This issue was also addressed in the recent report of the Task Force on Access to Television in Underserved Communities entitled "The Costs of Choice", 25 February 1985 (The Klingle Report). The recommendations of the Task Force in this regard were adopted by the Commission 1 March 1985 and are addressed in Public Notice CRTC 1985-60 which is also issued today.

3. WRITTEN SUBMISSIONS

(i) Public Notices CRTC 1984-13, 1984-47 and 1984-68

In order to permit interested parties to submit thorough, well-documented comments on its policy proposal, the Commission extended the deadline for filing comments from 1 March to 1 May 1984 (Public Notice CRTC 1984-47 of 28 February 1984). Furthermore, in Public Notice CRTC 1984-68 of 13 March 1984, the Commission widened the scope of its policy review to include over-the-air extension of Canadian broadcast signals outside of their original local markets. At the same time, the Commission acknowledged that such an extension could have significant policy implications and invited comments on a number of related issues to fully assess the potential impact of a change in policy.

In response, the Commission received in excess of 90 written briefs which addressed a number of policy-related questions.

The Canadian Association of Broadcasters (CAB) argued that the addition of distant Canadian television signals would, in most cases, introduce only a small increase in the overall Canadian content available, reduce advertising revenues flowing to local stations and, potentially, critically affect on the local broadcasters' operations. The CAB recommended that the Commission's: "existing policy authorising such a recarriage only on a special-case basis be retained at least until such time as adequate research has been conducted into the matter..."

The CBC and the CTV expressed views similar to that of the CAB, emphasizing that the broadcasting situation had not materially changed since 1979 and that there were "too many practical and economical arguments against importing distant Canadian signals and too few benefits to be derived from it." They urged the Commission not to permit the universal cable carriage of distant Canadian signals. According to CTV:

To rationalize the provision of additional television signals simply on the basis that some new method of delivery now facilitates it is not a justification for this proposal, particularly given that it would lead to an inescapable reduction in both the capacities of existing Canadian broadcasting system and the contributions made by it now to the aims and objectives of the Broadcasting Act.

Submissions from industry-related associations dealt with the potential effects of certain changes in the Commission's Canadian distant signal policy. For example, the Canadian Motion Picture Distributors Association (CMPDA) expressed concern about "any changes in the pattern of distribution of Canadian broadcasts which adversely affect their ability to obtain reasonable compensation from the use of their copyright material."

The Canadian Cable Television Association (CCTA) strongly supported the Commission's proposal to allow cable systems to enhance their service with the carriage of distant Canadian broadcast signals and suggested that its scope be further broadened. The CCTA argued that regulated industries such as cable television had not been allowed to compete equitably with unregulated home entertainment services, such as VCRs. The Commission's proposal would permit consumers a wider choice of programs, in particular, Canadian programs. The CCTA also pointed out that the proposed policy would have a minimal impact on the advertising revenues of local stations if the cable carriage of distant stations were restricted to discretionary tiers.

According to the CCTA, "the introduction of tiered cable television services can begin a gradual process proof transition allowing all elements of the broadcasting system to adjust to the new environment and to benefit from a wide range of program and service delivery options."

The Minister of Transportation and Communications of the Government of Ontario (Government of Ontario) supported the Commission's proposals on distant Canadian signals. In the words of the Minister:

Like many of today's issues in broadcasting, there are potentially negative implications in making progress and keeping up with technological change. While the introduction of Canadian superstations may cause some financial and programming adjustment on the part of local broadcasters, I believe that the benefits outweigh the disadvantages.

Viewers will have a significantly increased choice of programming, including Canadian programs. Canadian broadcasters will be permitted to more effectively with increasingly available U.S. signals and attractive non-broadcast sources of home entertainment, such as video cassettes.

(ii) Notice of Public Hearing CRTC 1984-89

After consideration of the submissions received, the Commission decided to hold a public hearing on the matter. In its notice announcing the hearing, the Commission urged all parties concerned to provide it with more empirical data on the major issues under consideration, and stressed that it would be especially interested in obtaining "further information relating to the impact of distant signal distribution on local broadcaster advertising revenues, cable carriage arrangements, as well as program acquisition and distribution arrangements."

In response to Notice of Public Hearing CRTC 1984-89, the Commission received 45 written submissions. Representatives of the cable industry, the Government of Ontario, CANCOM and Allarcom Limited were generally in favour of the proposed policy. Most representatives of the television broadcasting industry, the Alliance of Canadian Cinema, Television and Radio Artists (ACTRA), and Mr. David Orlikow, Member of Parliament, opposed it. Representatives of program producers and distributers, specialty cable services, TV Ontario and Multi-lingual Television (Toronto) Ltd. commented on certain aspects of the proposed policy. The various viewpoints presented in these written comments were elaborated upon in oral presentations at the public hearing.

4. ISSUES RAISED AT THE 27 NOVEMBER PUBLIC HEARING

At the hearing, which lasted four days, representatives of twenty-two interested parties reflecting all aspects of the television broadcasting and cable industries appeared before the Commission.

(i) The Demand for New Services

Representatives of the Government of Ontario suggested that distant Canadian signals should be at the top of the list of new services to authorize. Referring to a question contained in the most recent Gallup Omnibus Survey in Ontario about those Canadian services that could replace U.S. signals, the Government of Ontario noted that 32% of the population sample was interested in distant Canadian signals, 22% in a children's channel and 12% in a second CBC channel, while only 35% suggested leaving services as they are.

However, a number of broadcasters from British Columbia, Manitoba and Ontario claimed there was no consumer demand for distant Canadian television signals.

In a study conducted in 1984, using Ontario data only, Paul Audley identified a demand by consumers for additional Canadian viewing choices. Among other questions, respondents were asked to rate how important it was to increase the number of channels available to them; 15% said it was very important and 31% said it was somewhat important. In addition, the CCTA's study, entitled "Cable Attitudes, Pricing on New Tiered Services" indicated that Canadians were interested in receiving more general entertainment services and wanted "to watch quality entertainment, of their choice, on a more discriminatory basis."

According to the CCTA, there are concrete indications of the demand for additional television services: "Canadians are turning to unlicensed sources of programming because the broadcasting system still does not offer the full range of choice."

The CCTA also provided an estimate of the penetration rate of distant Canadian television signals if carried on discretionary tier. It suggested that the potential viewing audience of all Canadian distant signals would have been only 30,000 in 1984 if the Commission's proposed policy had been in effect, gradually increasing to twice that number by 1987. The CCTA also stated that, where cable systems currently deliver distant Canadian signals, their audience share is usually taken from U.S. rather than Canadian stations.

In its presentation at the hearing, Rogers Cablesystems Inc. estimated that a discretionary tier composed of two Canadian distant services together with a children's service and a health service would probably increase the penetration rate on its systems from the present 12% or 15% to about 20% or 25% within one year. Rogers also said it had received enquiries from various Canadian broadcasters as to whether and at what price Rogers might carry their signals if the Commission relaxed its policy on the discretionary carriage of distant signals.

(ii) The Availability of Additional Canadian Programs

The potential availability of additional Canadian programs was a recurring topic of discussion at the public hearing.

In a joint presentation, the CAB, the CBC, le réseau de télévision TVA, Global Communications Inc. and the CTV Television Network Ltd. said they could find "little evidence that the proposed distribution of distant signals will provide Canadians with real choice."

On the basis of studies presented at the hearing, the CAB argued that the Commission's proposed policy would yield a very small increase in the availability of, what the CAB termed as, relevant, unduplicated, prime-time Canadian programming.

On the other hand, based on the results of a program study undertaken by MediaStats Inc. and other evidence presented at the hearing, the CCTA said, "we believe it is fair to conclude that distant stations will significantly increase Canadian programming choices for cable subscribers."

(iii) Program Acquisition Arrangements

Broadcasters said that a relaxation of the Commission's policy would seriously affect existing television program acquisition arrangements. The extension of distant Canadian signals, they argued, would result in increased program acquisition costs for those originating stations involved, the potential loss of programs by smaller stations unable to purchase national rights, and possible bidding wars among stations competing for program rights in the same market, resulting in higher fees for both Canadian and U.S. programs.

The Association of Canadian Advertisers Incorporated, representing major Canadian corporations that use advertising, expressed concern that ACTRA intended to charge advertisers for the additional exposure of any commercial involving ACTRA members whether or not the advertiser was aware of, or would benefit from, exposure.

According to the Association, ACTRA already demanding residuals in accordance with national rights for advertising on the specialty television services, MuchMusic and The Sports Network.

The Institute of Canadian Advertising, which represents advertising agencies in Canada, expressed the same concern and referred to instances where an advertising agency might be held responsible for the payment of unforeseen residuals if advertiser itself refused payment.

TV Ontario argued that "the originating broadcaster's interest must be taken into account, as well as those of the local broadcaster, when as certaining any effects produced by distant signal policy changes."

The CMPDA referred to the experience in the United States, where the Federal Communications Commission relaxed its regulatory restrictions on the distribution of distant signals in 1980. If the Commission's policy were to be changed, members of the CMPDA could be expected to look to three mechanisms to ensure their contracts are respected: copyright law, contract law, and "the policies, decisions, regulations and conditions of licence of the CRTC."

In answer to questioning, the CMPDA recognized the Commission is not equipped to be an arbitrator between contracting parties in matters of copyright but said that it should take copyright factors into account in reaching its decision. Both the CMPDA and Simcom Ltd, a group of companies involved in Canadian feature film production and distribution, indicated that program acquisition arrangements are flexible and that existing contracts could be adjusted, but that the extent of any such adjustment would depend upon the response of local broadcasters. In the CMPDA's words:

We are very flexible in the licensing arrangements that we make as far as the coverage is concerned and we can come up with all sorts of permutations. But the essential thing in the licence agreement is that it is specified where the licensee has rights to transport that show.

(iv) Advertising Revenues

The potential impact of a change in the Commission's policy on the volume of advertising revenues flowing to television broadcasters was a principal theme at the public hearing. Some broadcasters alleged that advertising revenues lost as a result of implementation of the Commission's proposed policy approach would affect their ability to acquire programs and, in some cases, the broadcaster's financial viability. The revenue losses might occur indirectly as a result of audience fragmentation or directly as a result of diversion of advertising revenues toward distant stations.

The CAB referred to a financial analysis of the privately-owned television broadcasting sector for the years 1978-83 which indicates that smaller stations are less viable financially and therefore potentially more vulnerable to any regulatory change.

The Government of Ontario, on the other hand, contends that "additional signals will not seriously fragment the audience of local broadcasters in markets where the U.S. three-plus-one package already exists." Its research suggests that "some private stations have actually maintained or slightly increased their share of the audience after new stations entered their markets." The Government of Ontario recognized, however, the concerns about audience fragmentation and associated loss of revenues expressed by many local broadcasters and recommended, as did CANCOM, that the originators of distant signals be restricted from soliciting local advertising in distant markets.

(v) Time Shifting

Several submissions at the public hearing expressed concern about the effects of the time shifting of programs and program formats that would result from implementation of the Commission's proposed policy. For instance, British Columbia Television Broadcasting System Ltd., Mid-Canada Communications, Huron Broadcasting Limited and Bushnell Communications Limited all said that they would prefer competition from more distant signals in the event a choice exists between a signal from the same time zone and one from another. However, others such as Thunder Bay Electronics, argued that this was not the case.

The Canadian Football League (CFL) expressed a concern that the Commission's proposed approach would circumvent league policy with respect to the broadcasting of football games. To protect gate receipts from ticket sales, the CFL recommended that cable systems distributing a distant signal be required to delete CFL football games "unless prior league permission is obtained."

5. OBJECTIVES OF THE COMMISSION'S REVISED POLICY

The Commission has now had an opportunity to assess the impact of the introduction of distant Canadian signals in a number of markets during the preceding years, and to examine all of the information generated during its comprehensive policy review on the extension of distant Canadian television signals.

While there were wide-ranging and divergent views on a number of related issues, a clear concensus emerged from the discussions that major changes are occurring rapidly in the Canadian broadcasting environment, and that meaningful cooperation is necessary among all parties concerned if the Canadian broadcasting system is to benefit from this challenge.

The most significant effect of the recent advances in satellite, cable and other technologies has been the heavy and rapid influx of new competitive and alternative services from various sources, both regulated and unregulated. This highly competitive environment has offered Canadians a multiplicity of viewing choices, including a large number of U.S. satellite-delivered services and other home video alternatives.

In light of both the inherent dangers and the opportunities arising from this rapid evolution, it is critical that all elements within the Canadian communications environment review their roles, attitudes and strategies, and work closely together to wards ensuring the survival and development of a strong and distinctive Canadian broadcasting system. In the Commission's opinion, to achieve this end, it is necessary to foster the development and exposure of a variety of attractive and competitive Canadian programs, as well as allow the orderly introduction of additional Canadian services into new markets, subject to market capacity and consumer demand.

As noted in the recent Klingle report:

Everyone has a stake in the broadcasting system and effective solutions can only come about through accommodation and cooperation. If we are to build a better system, difficult choices must be made ...

The Commission is convinced that the revised policy set out herein is one means of ensuring that the broadcasting system as a whole remain predominantly Canadian and that overall long-term benefits accrue to the Canadian broadcasting system by extending alternative Canadian viewing choices to all parts of Canada, by enhancing the diversity and variety of Canadian programs distributed by cable systems.

In revising its existing policy, the Commission has borne in mind the following objectives:

(i) Increase Access and Availability of Canadian Programs

A primary objective in proposing increased access to distant Canadian television signals is to provide a wider range of Canadian viewing choices to communities across Canada that currently receive a limited number of Canadian services, often excluding a Canadian independent television service.

The Commission considers it particularly desirable to provide an additional Canadian service in those communities which do not have access to a third Canadian service and are unlikely to in the foreseeable future. Owing to the economics of local television service, a revised distant signal policy may be the only means to ensure a third Canadian service in some areas.

In addition, the Commission wishes to encourage the provision of an alternate French-language television service in major markets across Canada in order to increase the availability of distinctive French-language Canadian programs which are currently inaccessible to many viewers outside of the province of Quebec.

The information provided at the hearing and the Commission's own analysis suggest there is considerable potential for increasing the total volume and availability of Canadian programs by removing some of the existing restrictions with respect to the extension of Canadian television signals into distant markets.

The extension of Canadian television signals into new markets should enhance the variety and diversity of television services available throughout the country and will make Canadian programs more accessible in all parts of Canada. It will also provide more balance between the Canadian and U.S. services available to subscribers and constitutes a further step in the Commission's efforts to equalize Canadian viewing opportunities.

(ii) Respond to Consumer Demand

The surveys filed at the hearing and the Commission's own assessment suggest that the extension of attractive Canadian television signals into new markets will respond to an identified consumer demand for more Canadian services.

In addition to the requests processed by the Commission for the extension of Canadian services into core markets, the Commission has received a large number of applications for the cable carriage of distant Canadian television signals. In the last three years alone (1982-84), in excess of 50 applications from cable systems serving some 80 communities, including many small and medium-sized markets, have applied for distant Canadian television signals in one form or another. These requests reflect consumer interest in and demand for additional Canadian signals.

In addition to the aforementioned surveys, another indication of the demand for additional cable television services is reflected by the volume of cable subscribers purchasing multi-service discretionary packages. According to the 31 December 1984 report on discretionary services by MediaStats Inc., nearly four times as many cable subscribers receive multi-service packages as receive stand-alone services. About 44% of those subscribers that receive packages take more than three services. Of these, the single most popular package is the full package of nine services.

The extension of quality Canadian signals into new markets will enhance the services offered by Canadian cable systems and is an effective means of increasing the overall Canadian share of the viewing market at the expense of non-Canadian services, which are available from unregulated sources, particularly in western Canada.

(iii) Enhance Discretionary Cable Tiers

Many cable systems are already equipped to supply additional cable services and the carriage of additional Canadian signals will permit these systems to utilize their existing capacity more fully in order to satisfy adequately the increasingly sophisticated needs of their markets.

The services will also enhance the value of existing discretionary cable service packages at relatively low incremental cost thus benefiting the Canadian pay and specialty services.

6. A REVISED REGULATORY APPROACH

In developing guidelines for the implementation of its revised policy, the Commission has been particularly sensitive to the issues expressed by television broadcasters especially with respect to the important role of the local broadcasters within the Canadian broadcasting system. Consequently, changes in the Commission's existing policy will be introduced in a gradual, phased-in manner, and will include appropriate safeguards to ensure minimum impact on the local broadcasters' revenues and ability to maintain their local programming commitments, while trying to satisfy the continually growing demand of the Canadian public for more programming choices. Some local broadcasters may wish to consider the possibility of entering into twin or triple sticking arrangements in order to benefit from the Commission's revised policy.

For the purposes of the criteria set out below, a distant Canadian television signal in a particular region is defined as any signal that is not subject to the television service priorities described in Section 6 of the Cable Television Regulations.

(i) Distribution on a Discretionary Cable Tier

The Commission will be favourable to the approval of applications from broadcasting receiving undertakings for the distribution of distant Canadian television signals on a discretionary tier, subject to the following provisions:

1) there should be no objection on the part of the originating station whose signal is being extended; and

2) the originating station whose signal enters a distant market should not accept local advertising from such a market.

Furthermore, to allow an orderly implementation of this policy, for a transitional period of one year from the date of this notice, the Commission will announce the receipt of applications for the cable distribution of distant Canadian signals on a discretionary tier by means of a public notice. After this time, to minimize unnecessary delays in its decision-making process, the Commission will process all such applications using the simplified administrative procedure set out in Public Notice CRTC 1982-42.

Tiering - Linkage

In Public Notice CRTC 1984-81 of 2 April 1984, entitled "Specialty Programming Services", the Commission outlined revised linkage requirements for the cable carriage of Canadian and non-Canadian discretionary services which it considered appropriate on the basis of the services authorized at that time.

Any services authorized pursuant to the revised policy announced in the present Public Notice will not, how ever, qualify as pay or specialty services for the purpose of the tiering or linkage requirements set out in Public Notice CRTC 1984-81.

(ii) Distribution on the Basic Tier

The Commission will examine, on a case-by-case basis, applications from broadcasting receiving undertakings for the cable distribution of distant Canadian signals on the basic tier. In assessing these applications, the Commission will take into account the following considerations:

(a) there should be no objection on the part of the originating station whose signal is being extended;

(b) the originating station whose signal enters a distant market should not accept local advertising from such a market;

(c) the originating station should continue to adhere to the local programming commitments of its licensing decision;

(d) the distant station should enhance the diversity of Canadian programming in the market.

The Commission will also examine:

(e) the number of local television services in existence or likely to be licensed in the distant market;

(f)  the degree of the distant signal's potential impact on the revenue base of the local broadcasters and on their ability to meet their programming commitments.

The Commission's current procedure for the consideration of applications for the distribution of distant Canadian television signals on the basic service, which involves the issuance a public notice will remain unchanged. In this way, interested parties, and in particular the broadcasters concerned, will have an opportunity to demonstrate to the Commission the possible effects that are likely to flow from approval of the application under consideration. In those cases where public comments warrant further examination, the Commission will consider the application at a public hearing before rendering a decision.

(iii) Over-the-air Distribution

The Commission will examine, on a case-by-case basis, applications from broadcasting transmitting undertakings for over-the-air distribution of distant Canadian signals. In assessing these applications, the Commission will take into account the following considerations:

(a) there should be no objection on the part of the originating station whose signal is being extended (in those cases where the originating station is not the applicant);

(b) the originating station whose signal enters a distant market should not accept local advertising from such a market;

(c) the originating station will continue to adhere to the local programming commitments of its licensing decision;

(d) the distant station should enhance the diversity of Canadian programming in the market.

The Commission will also examine:

e) the number of local television services in existence or likely to be licensed in the distant market;

(f) the degree of the distant signal's potential impact on the revenue base of the local broadcasters and on their ability to meet their programming commitments;

(g) the availability of the required frequency in the proposed new market(s);

(h) whether cooperative arrangements (such as twin-sticking) between the originating station and a local broadcaster(s) in the distant market are involved or are being considered.

The Commission's current procedure for the consideration of applications for the over-the-air distribution of distant Canadian television signals, will remain unchanged. In this way, interested parties, and in particular the broadcasters concerned, will have an opportunity to demonstrate to the Commission the possible effects likely to flow from approval of the application under consideration. In those cases where public comments warrant further examination, the Commission will consider the application further at a public hearing before rendering a decision.

(iv) Licensing of Distant Canadian Signals

When the Commission licences a broadcasting transmitting undertaking, it approves as part of the application the location of the transmitter, the frequency to be used and the power at which the station will operate. At the same time, the decision granting the licence is based in large part on the licensee's commitment to provide a local service to the viewers within its primary coverage area and spells out the licensee's mandate in this regard.

The extension of the signal of a Canadian television station outside of its original coverage area is generally done by means of over-the-air retransmission of the signal, by microwave or by satellite distribution.

Undertakings involved in the extension of a distant signal will be subject to the usual CRTC licensing procedures, at the transmitter, cable and network levels. Depending on the particular circumstances of each case, the following may be required:

a) Over-the-air retransmission of a distant signal for broadcast by an affiliate may require the issuance of a new licence to that affiliate and the issuance or amendment of the licence of the originator. This procedure may also apply to the retransmission of a signal via a twin stick or triple stick arrangement.

In the case of repeaters, where a licensee proposes to establish a rebroadcaster owned by it, to extend its own signal into a new market, a new or amended licence may be required to add the additional transmitter to the licensee's original authority.

b) Extension of service via microwave for cable distribution may not require an amendment of the licence the originator of the signal; such extension will, however, be considered within the context of the cable television licensee's application for the carriage of this signal on a market-by-market basis.

c) A licensee proposing to extend its service via satellite for the cable distribution of its signal to distant markets, may be required to file an application for a network licence. The licensee will, however, have to satisfy the Commission that it will continue to adhere to the conditions contained in its original licence and, in particular, to its local programming commitments.

d) In the case of the extension of a distant signal via satellite, where there is an intermediary between the originator of the signal and the broadcasting undertaking proposing to exhibit the signal in a local market, a network licence may be required to be issued to the intermediary for the satellite distribution of the signal.

7. Concluding Remarks

As noted earlier, the new, highly-competitive broadcasting environment provides us with a challenge which requires all of our best efforts if we are to benefit and strenghten the Canadian broadcasting system. The extension of Canadian distant signals into new markets will improve the choice offered to Canadian viewers. This will not, in itself, solve the critical struggle for a distinctive and strong Canadian broadcasting system; it will, however, contribute to that objective.

In order to compete effectively in this new environment, concerted efforts must be made by all concerned to take new and imaginative initiatives to increase the availability of attractive, competitive, high-quality Canadian programs.

To achieve this end, the Commission has already initiated consultations on this matter and intends to further review proposals designed to better reflect the objectives of the Broadcasting Act for the development of high-standard programming "that will enrich and strengthen the cultural, political, social and economic fabric of Canada."

In this regard, the Commission refers to its policy statement released earlier this week (Public Notice CRTC 1985-58 dated 20 March 1985) which introduces more flexibility in the concept of local television programming to stimulate the development of a greater number of local and regional co-productions of higher quality for scheduling at competitive viewing hours.

Fernand Bélisle Secretary General