ARCHIVED -  Public Notice CRTC 1989-23

Public Notice

Ottawa, 23 March 1989

Public Notice CRTC 1989-23

Services Using the Vertical Blanking Interval (Television) or Subsidiary Communications Multiplex Operation (FM)

INTRODUCTION

In Public Notice CRTC 1984-117, the Commission outlined its policy objectives and regulatory approach for services using the Vertical Blanking Interval (VBI) of television stations and the Subsidiary Communications Multiplex Operation (SCMO) channel of FM stations.

Licensees authorized to distribute VBI/SCMO were required to file reports detailing their experiences in developing these services. These reports were taken into consideration by the Commission in preparing for the second phase of the regulatory process for VBI/SCMO introduced in Public Notice CRTC 1988-33.

Over this period, the Commission was developing a more supervisory approach to broadcasting and VBI/SCMO services seemed well suited to this approach. Consequently, in Public Notice CRTC 1988-33, the Commission proposed to eliminate the requirement that licensees must apply to use VBI/SCMO, and also proposed amendments to Tevision Broadcasting Regulations, 1987 (the television regulations) and to the Radio Regulations, 1986 (the radio regulations), in order that licensees would no longer be subject to these regulations, when they use VBI and SCMO to distribute programming. The version of Public Notice CRTC 1988-33 published in the Canada Gazette inadvertently omitted the text of the proposed changes to the television and radio regulations. Public Notice CRTC 1988-199, which corrected this omission, provided a second opportunity for public comment.

ISSUES RAISED BY RESPONDENTS

There were 14 responses to Public Notice CRTC l988-33 and two responses to Public Notice CRTC 1988-199. The proposed policy and changes to the television regulations with respect to VBI were generally greeted with enthusiasm. With respect to SCMO, however, while most praised the Commission's move toward a more supervisory role, some expressed concern that the proposed changes were too sweeping.

Although many respondents included VBI in the same discussion as SCMO, the concerns were clearly focused on SCMO, in particular on the fact that SCMO programming could resemble that of conventional broadcasting and that SCMO decoders are becoming increasingly affordable and available to the public. While a few suggestions were advanced regarding the guidelines, no concerns were raised regarding most of them and the policy on VBI/SCMO as enunciated in Public Notice CRTC 1988-33. Such concerns as were raised have been grouped into four categories as follows:

1. Unregulated ancillary services (particularly SCMO) offer potentially unfair competition to conventional broadcasting

Several respondents expressed general concern regarding the potential impact on conventional broadcasting services of services such as SCMO if they are unregulated. They usually drew a distinction between programming and non-programming services and focused on services of the programming type. Although conventional ethnic broadcasters expressed the most unease, others were concerned that SCMO might be used to deliver services featuring top 40 music selections exclusively, for example, or others without any Canadian content. Some respondents considered the safeguards afforded by the guidelines to be inadequate and requested the Commission to permit public comment on such proposals. Some suggested that such proposals should be subject to the same public process as any proposal for a new conventional broadcasting undertaking. In the Commission's view, such concerns are assuming increasing legitimacy. In the past, equipment to decode SCMO services was expensive and the availability of such equipment was limited. Today, however, SCMO decoders are becoming more readily available, often for well under $100. The very affordability of SCMO services is likely to make them more attractive to the general public.

With respect to the suggestion that the Commission should distinguish between programming and non-programming services offered via VBI or SCMO, the Commission considers that this would require the development and implementation of tests or rules to enable the differentiation to be made. In the Commission's view, this would not promote its objective of a more streamlined regulatory approach.

Nevertheless, the Commission recognizes that certain unregulated SCMO services present a potential threat to some existing conventional broadcasters. Regarding services such as those described in the above examples featuring top 40 format or l00% foreign content, the Commission will clearly not permit licensees to use SCMO as a means of circumventing Commission policies and will take appropriate measures if this occurs. Ethnic services, on the other hand, have previously been identified by the Commission as possible candidates for distribution using SCMO technology. Given the possibility that such services may potentially compete with conventional over-the-air ethnic services which must meet specific regulatory requirements, the Commission has concluded that there should be opportunity for public comment if an ethnic service on SCMO is being proposed within the service area of a conventional ethnic broadcaster.

The guidelines are therefore being amended to indicate that an application to the Commission will be required if an SCMO service contains more than l5% ethnic content (types A, B, C and D) and is proposed for distribution in an area already served by an authorized over-the-air ethnic station. The Commission will deal with such applications through the normal Public Notice or Public Hearing process as appropriate.

2. Mandatory Cable Carriage

The CTV Television Network Ltd. and the Ontario Educational Communications Authority (TVOntario) both support the idea of mandatory cable carriage of VBI. TVOntario went so far as to say that if the Commission contemplates exempting a particular cable company, such exemption should be the subject of public debate. The Canadian Cable Television Association, on the other hand, takes the position that cable television companies should be able to strip ancillary signals or at least should be able to share in any profits they generate.

Section 19 of the Cable Television Regulations, l986 generally prohibits a cable television licensee from altering or curtailing any programming service or radiocommunication in the course of its distribution. A licensee may be relieved from this requirement by condition of licence. The intent of guideline 5 of Public Notice CRTC l988-33 is to provide a mechanism for protecting the main service of an FM or television station which the Commission considers to be of primary importance. In the rare case where a cable licensee may request relief from the requirement set out in section 19 of the cable television regulations, there would be opportunity for public comment through the normal public process. The Commission is not persuaded that any changes in this regard are required.

3. Possibility of Abuse

Several respondents identified areas of possible abuse if VBI/SCMO is not regulated more closely. The examples they cited include the potential of VBI/SCMO for the distribution of partisan political comment, defamatory comment, racially intolerant programming, and divisive comment by narrow interest groups. One party also mentioned the possibility of licensees providing captions for the hearing impaired in scrambled form. It was noted that, without logging requirements, it would be more difficult to take corrective action if abuse occurred. Moreover, the Canadian Association for the Deaf expressed concern that the Commission would be weakening its ability to influence the development of captioning. It is true that a move to a more supervisory role by the Commission carries some risks. In the Commission's view, however, these are controlled risks. For example, it notes that, where appropriate, the Broadcasting Act would continue to apply to VBI/SCMO services. Moreover, the Commission considers that by clearly stating its expectations of licensees in this notice and its attached guidelines, the likelihood of abuse is reduced. The Commission will be following the development of VBI/SCMO closely and will take appropriate action should abuses occur. At the same time, the Commission fully expects its licensees to ensure that their VBI/SCMO services are operated in a responsible manner, consistent with the objectives of this supervisory approach.

4. Restrict SCMO

In its submission, Standard Sound Services requested the Commission to declare that SCMO services are private transmissions which may be legally received only with the express permission of the originator. It is oncerned that if the general public is allowed to receive SCMO, the background music industry will be placed in jeopardy.

The Commission notes that this would be a major departure from the manner in which SCMO transmissions are currently treated and would work to the detriment of SCMO providers desiring wide exposure.

It also notes that the guidelines in Public Notice CRTC l988-33 do not preclude scrambling and do allow the collection of revenue from subscription fees. The Commission considers that the guidelines in this regard are adequate and do not require modification.

POLICY ON VBI/SCMO

The Commission has carefully considered all of the comments received in response to Public Notices CRTC l988-33 and CRTC l988-l99 and concludes that the proposed licensing policy for VBI/SCMO should be modified only with respect to an SCMO ethnic service. Specifically, an application to the Commission will be required if more than 15% of the broadcast week of the SCMO service is devoted to ethnic programs as defined in the radio regulations (types A, B, C and D) and its service area overlaps an area already served by an authorized over-the-air conventional ethnic station. Service areas will be deemed to overlap if the 0.5 millivolt per metre official contour of the FM station carrying the proposed ethnic service on SCMO intersects:

- the 0.5 millivolt per metre official contour of an authorized over-the-air FM ethnic station; or

- the 5.0 millivolt per metre official day-time contour of an authorized over-the-air AM ethnic station.

The Commission will handle applications for such SCMO ethnic services through the normal Public Notice or Public Hearing process, as appropriate, and may impose specific requirements as conditions of licence. The attached Appendix A contains guidelines to which licensees are expected to adhere in the provision of VBI/SCMO services.

IMPLEMENTATION

The television licence form will be amended to indicate that the use of the VBI is included in the licence for the main service and these forms will be used for all future licence renewals. Any licensee wishing to begin to use VBI prior to the renewal of its licence may apply to the Commission for an amendment.

The FM licence form will be amended to indicate that, with the exception described in guideline 2) in Appendix A, the use of SCMO is included in the licence for the main service and these forms will be used for all future licence renewals. Any licensee wishing to begin to use SCMO prior to the renewal of its licence may apply for an amendment.

At the same time, the Commission has amended the television and radio regulations so that these regulations will not apply to the use by a licensee of its VBI or SCMO. The new regulations have been registered with the Clerk of the Privy Council to come into effect immediately. These regulations will be published shortly in the Canada Gazette. A copy of the new regulations is included as Appendix B of this Public Notice. The Commission would like to thank those who have expressed their views and, thereby, have assisted in developing this policy on VBI/SCMO.

Fernand Bélisle
Secretary General

APPENDIX A
Guidelines regarding the provision of VBI/SCMO Services

1) Broadcasters have a primary responsibility to fulfill the commitments made with respect to the main service they are licensed to provide. Any use of the VBI/SCMO should not detract from the licensee's ability to meet all of its responsibilities and to fulfill its Promise of Performance.

2) An application to the Commission is required only if more than 15% of the broadcast week of an SCMO service will be devoted to ethnic programs as defined in the radio regulations (types A, B, C and D) and its service area overlaps that of an authorized over-the- air conventional ethnic station as defined previously at pages 7 to 8 of the accompanying public notice.

3) While the Commission is not limiting the types of VBI/SCMO services at this time, the Commission would be concerned:
° if the VBI/SCMO were used in a manner that circumvents Commission policies;
° if a VBI/SCMO service were to cause undue negative impact on existing local broadcasting services; ° if long-term commitments for the provision of services that are unrelated to the licensee's primary programming service were to constrain a broadcaster's ability to respond to future programming needs.

4) Licensees adding a VBI/SCMO service or changing the nature of an existing VBI/SCMO service should inform the Commission in writing of the type of service to be provided.

5) Captions for the hearing impaired should be given a high priority; line 21 of the VBI should be reserved for this purpose.

6) Cable television licensees shall not curtail or alter VBI/SCMO services; if the carriage of these services causes undue technical interference to the programming on a main channel, the Commission may, upon application, exempt the cable licensee from this obligation by condition of licence.

7) Revenues may be derived through advertising or subscription fees for VBI/SCMO services, as appropriate.

8) Separate financial records should be kept for each VBI/SCMO service and should be made available to the Commission on request.

9) Revenues from the licensee's main programming service should not be used to subsidize VBI/SCMO services that are unrelated to the licensee's primary programming services.

10) Where appropriate and where capacity is available, licensees are encouraged to provide access to third parties on a mutually-agreed basis.

11) Technical quality on the main television or FM channels should not be impaired by the use of VBI/SCMO.

12) The Commission will monitor the development of VBI/SCMO services and will take appropriate steps, if required. APPENDIX B

Amendments to Television Broadcasting Regulations, 1987

1. Section 2 of the Television Broadcasting Regulations, 1987 is amended by adding thereto, in alphabetical order within the section, the following definition:

""vertical blanking interval" means the brief period of time which recurs approximately 60 times per second between successive scans of television pictures. (intervalle de suppression de trame)"

2. Section 3 of the said Regulations is revoked and the following substituted therefor:

"3. These Regulations do not apply in respect of programming that is broadcast by a licensee using a signal contained in a second audio program channel or in a multiplex channel or during the vertical blanking interval."

Amendments to Radio Regulations, 1986

1. The Radio Regulations, 1986 are amended by adding thereto, immediately after section 2 thereof, the following heading and section:

"Application

2.1 (1) These Regulations do not apply in respect of programming that is broadcast by a licensee using a subsidiary communications multiplex operations channel. (2) For the purposes of this section, "baseband" means signals in the frequency range of 0 to 99 kHz that are used as input to the transmitter of an FM station; (bande de base) "subsidiary communications multiplex operations channel" means a frequency band containing one or more subcarriers that is centred at 76 kHz in the baseband during stereophonic or monophonic transmission in the main channel or at 59.5 kHz in the baseband where there is no stereophonic or monophonic transmission in the main channel. (canal d'exploitation multiplexe de communications secondaires)"