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Decision
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Ottawa, 28 September 1990
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Decision CRTC 90-1036
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Vidéotron Ltée, Parts of Montréal and surrounding areas, Quebec - 893591800
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Following a Public Hearing in Montréal beginning on 13 March 1990, the Commission renews the Class 1 licence for the broadcasting receiving undertaking serving parts of Montréal and surrounding areas, held by Vidéotron Ltée (Vidéotron), from 1 October 1990 to 31 August 1995. The operation of this undertaking is regulated pursuant to Parts I and II of the Cable Television Regulations, 1986 (the regulations), and the licence will be subject to the conditions specified in this decision and in the licence to be issued.
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At the hearing, the Commission reviewed with the licensee the operation of this undertaking over the term of its current licence which was renewed in 1986 (Decision CRTC 86-968) and examined its plans for the next licence term.
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Vidéotron pointed out that a major investment program designed to improve the quality and reliability of its basic service was initiated three years ago and should be virtually completed by the end of 1990. The licensee has not proposed any capital investments of this nature or magnitude over the next five years, except for the necessary replacement of subscriber service drops that have been in use for several years.
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Vidéotron also emphasized the positive measures it has taken over the last four years to improve customer relations, including the implementation of a regionalization plan to establish closer contacts with subscribers in the various sectors of its authorized service area. The Commission also notes that the licensee has monitored the quality of its service for almost two years, through the monthly analysis of a series of performance indicators. The Commission notes that, since the release of Public Notices CRTC 1988-13 and 1990-53, the Canadian Cable Television Association has been developing an industry code of service standards on behalf of Canadian cable companies, which should be submitted to the Commission for approval by 31 December 1990.
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Billing Practices
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Despite the steps undertaken by the licensee to improve customer relations, the Commission has continued over the current licence term to receive, either in written form or, more frequently, over the telephone at the regional office in Montréal, comments, inquiries and complaints concerning Vidéotron's billing methods. According to the information available to the Commission and the statements made by the licensee at the hearing, Vidéotron prefers three methods of payment for cable services: direct monthly debits, semi-annual invoicing, and annual invoicing. At the hearing, the licensee maintained that it is in full compliance with existing regulations and the directions set out in Public Notice CRTC 1982-37 dated 18 May 1982.
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While acknowledging that the aforementioned methods of payment have some administrative advantages and are acceptable if both parties consent to them, the Commission reminds the licensee that current and potential subscribers must be informed verbally or in writing in a clear and precise manner with respect to the available payment options as well as the requirements under section 17 of the regulations that a cable licensee must provide cable service upon payment by the subscriber of the installation fee and the "fee for the provision of the basic service for one month", and "provide the basic service to a subscriber as long as the subscriber pays in advance the fee for each month of the basic service".
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The Commission also received complaints concerning the administrative fees charged on overdue accounts, particularly in those cases where the invoicing period exceeded one month. It notes that, while the regulations do not specifically address the matter of administrative fees, it is clear that the licensee may not discontinue service to a subscriber who refuses to pay such administrative charges, provided that there has been advance payment of the basic monthly fee.
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English-language Services
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Another issue which was discussed at the hearing and raised in several interventions is that a significant number of the subscribers in certain neighborhoods served by Vidéotron are anglophone and have expressed their wish for increased access to more English-language services, notably in the municipalities of Côte-Saint-Luc and Notre-Dame-de-Grâce. The dissatisfaction is accentuated by the fact that the service area boundaries of the cable systems operated by Vidéotron and CFCF Inc. divide these sectors, so that the residents of a given municipality may not receive the same programming services and may be charged different fees.
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According to statements made at the hearing, discussions were held concerning the sale or trade of adjacent portions of the two undertakings' service areas in an effort to arrive at a more rational allocation of service areas, but negotiations were not successful. Vidéotron also indicated that it cannot provide additional programming services until it expands the distribution capacity of its undertaking, which will be accomplished by the end of 1990. The Commission expects the licensee to continue its efforts to provide services which meet the needs of its subscribers.
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The Commission notes that several interventions expressed dissatisfaction with Vidéotron's replacement, in December 1989, of WETK Burlington, Vermont, a PBS educational television station, with WCFE-TV Plattsburgh, New York, another station from the PBS network. The licensee explained that the change, which provides a better quality signal to subscribers, was made to avoid the payment of royalties for the retransmission of distant signals, as required pursuant to the Canada-U.S. Free Trade Agreement. However, it did acknowledge at the hearing that it had not adequately informed its subscribers in advance of the reasons for the change, and indicated that steps had been taken to prevent a recurrence of the problem.
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Ville de Lorraine
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In the Notice of Public Hearing, the Commission indicated that it intended to discuss with the licensee the installation of service in the Ville de Lorraine sector of its authorized service area. This municipality has a by-law requiring that cables be buried, and the parties have not yet reached an agreement on the sharing of the installation costs, despite the recognition of this problem several years ago. In Decision CRTC 86-968, the Commission noted the licensee's statement that it was in a position to proceed with the installation of the service on a joint basis with the public utilities companies, and expected Vidéotron to commence work immediately.
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At the hearing, Vidéotron stated that, as the parties could not come to an acceptable installation schedule, the plans discussed in 1986 were not implemented but that it had continued to negotiate with the municipality from 1987 to 1989. It emphasized that there had been public consultation on this issue with the residents of the municipality, and that a majority of residents voted down the proposal to share installation costs. The licensee added that the tests that were undertaken in 1989 with respect to an over-the-air distribution technology proved to be unsuccessful.
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Following discussion on this issue at the hearing, Vidéotron agreed to examine, with representatives of the municipality of Ville de Lorraine, other possible solutions, including a lump-sum payment by subscribers for the costs associated with the installation of the necessary cables or higher monthly subscriber fees in the sector concerned and the submission of a progress report within six months. The licensee also indicated that it would be prepared to have the unserved sector deleted from its authorized service area if this final attempt at conciliation fails. The Commission therefore expects the licensee to submit a report, within six months of the date of this decision, setting out the results of the negotiations and, if applicable, a specific schedule for the implementation of service in the unserved sector of Ville de Lorraine in the near future. Should the licensee not be in a position to make such a commitment, the Commission expects it to file an application to have this sector deleted from its service area.
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Community Programming
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The Commission reiterates the importance it places on the development of community programs, and it notes Vidéotron's achievements in this area and the human and financial resources that the licensee has allocated to community programming during the current licence term. It notes that community programs are produced at ten locations in as many sectors. While Vidéotron itself operates studios in Montréal and Laval, community organizations operate the other studios in Beloeil, Vaudreuil, Saint-Jérôme, Saint-Jean, Repentigny, Joliette, Châteauguay and Boucherville.
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In 1989, local community productions represented 77 hours of original programming each week, which exceeds or compares favourably with most Canadian undertakings of a similar size. The Commission notes the philosophy outlined by Vidéotron at the hearing concerning the operation of the community channel and the important contribution of volunteers, as well as its commitment to increase its annual community programming budget from $2,259,000 in the first year of the new licence term to $3,204,000 in the fifth year. The Commission further notes that, following the issuance of Public Notice CRTC 1990-57 dated 5 June 1990, it initiated a review of its community channel policy and, notably, the level of financial support for community programs. It encourages the licensee to increase the annual budgetary commitments to the community channel in proportion to the revenue derived from its basic service.
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Vidéotron informed the Commission that since July 1989 the Saint-Jérôme community channel is no longer being shared by station CHOY-TV Saint-Jérôme because that local television station has ceased its community production activities. In this regard, the licensee is required to submit a report to the Commission, within 90 days of the date of this decision, describing the measures taken to have community groups in the Saint-Jérôme area replace the CHOY-TV community programs and outlining the types of programs and production schedule proposed.
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In accordance with previous decisions, the Commission relieves the licensee, by condition of licence, of the requirement of paragraph 9(1)(c) of the regulations that it distribute the programming service of the local television station CHOY-TV Saint-Jérôme. The Commission also relieves the licensee, by condition of licence, of the requirement of paragraph 9(1)(c) of the regulations that it distribute the programming services of the priority television stations CFTU-TV Montréal and CJOH-TV-8 Cornwall, Ontario, on the basic band of its basic service if channels are available. The licensee is still required to distribute CFTU-TV and CJOH-TV-8 as part of the basic service.
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The Commission approves, by condition of licence, the licensee's request to be relieved of the requirement of subsection 16(2) of the regulations that it distribute the audio programming services of CIRL Montréal, CKHQ-FM Kanesatake, Quebec, and CFLG-FM Cornwall, Ontario. In addition, pursuant to Decision CRTC 90-900 dated 14 September 1990, the licensee is also relieved of the requirement to distribute CFNJ-FM Saint-Gabriel-de-Brandon and CJLA-FM Lachute.
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Specialty Programming
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The Commission notes that, over the course of the current licence term, Vidéotron increased the choice of programming services available to subscribers by adding those Canadian French-language specialty programming services authorized by the Commission in 1987. Despite the many comments brought about by the introduction of these new services, the licensee stated at the hearing that, based on its regular subscriber surveys: [TRANSLATION] "The vast majority of our customers want these specialty services, which are offered as part of the basic service and which would not otherwise be available."
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The Commission notes that Vidéotron played a key role in the successful integration of French-language specialty programming services because it is by far the largest cable undertaking in the province of Quebec. The licensee has thus made a major contribution towards achieving those objectives of the Broadcasting Act which relate to the diversity and quality of the programming offered by the Canadian broadcasting system. The Commission also notes the commitment made by Vidéotron at the hearing to continue the distribution of French-language specialty programming services as part of the basic service during the new licence term, and to distribute all such services that may be authorized by the Commission.
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Ethnic Programming
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The Commission further notes that Vidéotron and CFCF Inc. have been operating a special ethnic programming service on a joint basis since the fall of 1989. Television of Ethnic Quebec (TEQ), an organization which was established with this service in mind, has one representative from each of these cable systems as well as five representatives from the field of ethnic production on its board of directors.
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The Commission's analyses, in 1988 and 1989, of programs broadcast on the ethnic channel revealed that the content of some advertising messages did not conform to the type of restricted advertising authorized on an exceptional basis in Decision CRTC 86-347 and reiterated, by condition of licence, in Decision CRTC 86-968. Following discussions on this issue, including a letter dated 16 October 1989 from the Commission to the two licensees clarifying the term "sponsorship message," the licensees prepared a reference document to define the parameters of authorized sponsorship entitled "Guide pour l'utilisation des messages publicitaires à l'usage des producteurs de TEQ" (the TEQ producers' guide to the use of advertising messages).
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As a result of the measures that have been taken, the statements made at the hearing by Vidéotron and those by the TEQ during its intervention, it appears that the concerns regarding sponsorship messages broadcast on the ethnic channel have been addressed, and all parties involved are fully aware of their responsibilities in this area. The Commission intends to monitor the ethnic channel very closely during the new licence term, and it encourages the licensee to continue using the aforementioned reference material and any other available means to ensure full compliance with the condition of licence set out below.
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In view of the foregoing, the Commission authorizes the licensee to continue distributing its special ethnic programming service. It is a condition of licence that the licensee shall not distribute as part of this ethnic service any commercial message other than a sponsorship credit, included in the program credits, which combines no more than the logo, name, address and type of activity or profession of the sponsor. The sponsorship credit may contain sound and/or visual images, whether moving or fixed. The sponsorship credit shall have no purpose other than to acknowledge, in a concise and direct manner, the sponsor's contribution and shall at no time, constitute a detailed description or promotional device. The licensee is also authorized, on an exceptional basis, to add English- or French-language subtitles to feature films on the special multicultural programming service, provided that these subtitles are an integral part of the original production.
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With regard to complaints and interventions concerning access to the ethnic channel, Vidéotron indicated that the number of hours that is allocated to the various ethnic groups is based on the demographic presence of each cultural community, according to the data received from Statistics Canada for the Montréal region. The Commission notes that the programs distributed on the ethnic channel are at the discretion of the licensee because the latter is fully accountable to the Commission for these programs, and because the Commission is not empowered to dictate what programs shall be distributed. Further, it considers that the involvement in the ethnic channel of 42 producers serving 34 ethnic communities in 30 different languages provides a good indication that the licensee practises a policy of broad access.
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Interactive Television
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At the hearing, the Commission also discussed with the licensee its initiatives relating to interactive television which, among other things, allows viewers to interact with program content and change the course of a program according to their tastes and preferences.
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In this regard, the Commission noted with interest the information provided by the licensee at the hearing on this new method of distributing television programs in interactive mode, which has been available to Vidéotron subscribers in the Montréal area since last spring and will be available in the Québec City area in the fall of 1990. The Commission commends the licensee for its ongoing research and development, which has enabled Vidéotron to provide its subscribers with services that are at the cutting edge of technology.
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The Commission authorizes the licensee to continue distributing, at its option, an "arts and entertainment" specialty programming service which, by definition, must not carry any advertising messages. Pursuant to the authority granted on 31 October 1989, the licensee is also authorized to use its "arts and entertainment" channel for the distribution of its interactive television programming, exclusive of other interactive programs by authorized broadcasters, for the purpose of familiarizing subscribers with the use of the "Vidéotron" terminal. The Commission reminds the licensee that programs on the "arts and entertainment" service should generally be drawn from categories 7, 8 and 9, and from category 6 for some sports programs as defined in Schedule I of the Television Broadcasting Regulations, 1987. The Commission notes that station CFTM-TV Montréal and the pay television service SuperÉcran are currently working with the licensee on experiments in interactive television, in addition to the projects mentioned at the hearing involving other broadcasters from the province of Québec and from outside the country. Given the ownership ties between Vidéotron and Télé-Métropole, the Commission wishes to ensure that this relationship will not constitute an undue advantage for CFTM-TV. Accordingly, it expects Vidéotron to ensure equal access for all other broadcasters interested in participating in research and development on new sources of interactive programming.
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In this regard, the Commission reiterates its concerns regarding the fact that the additional costs incurred by broadcasting licensees in producing interactive programs must not diminish their commitment in terms of the expenditures that must be devoted to the production of Canadian programs. Vidéotron must also ensure that the development and marketing of its "Videoway" terminal and interactive television service are not subsidized by basic service subscribers. In view of the concerns previously mentioned regarding Vidéotron's invoicing methods, the Commission expects the licensee to inform its subscribers clearly regarding the available payment options related to the tier of discretionary services, particularly for the linkage of interactive television and pay television services. Finally, in view of the experimental and innovative nature of its interactive television service, the Commission expects the licensee to inform it, on an annual basis, of the evolution of the service by providing it with the program schedule for the "arts and entertainment" channel, a description of the programs, a list of the existing programs available and in production, a list of parties involved in the production and broadcast of this programs and the current number of subscribers to the service.
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The Commission has taken into account the views expressed in the 45 interventions filed with respect to this application, and is satisfied that the intervenors' concerns have been adequately addressed, both by the licensee in its written and oral replies to the interventions, and by the Commission in the context of the present decision.
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Alain-F. Desfossés
Secretary General
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