ARCHIVED -  Decision CRTC 97-38

Decision

Ottawa, 31 January 1997

Decision CRTC 97-38

Shaw Communications Inc., on behalf of a company to be incorporated (Homestar)

Across Canada - 199608428

New, national, direct-to-home satellite distribution undertaking - Approved

Following a Public Hearing held in Vancouver commencing 23 September 1996, the Commission approves the application by Shaw Communications Inc. (Shaw), on behalf of a company to be incorporated (Homestar), for a broadcasting licence to carry on a new, national direct-to-home (DTH) satellite distribution undertaking. This approval is in accordance with the policy provisions set out in Public Notice CRTC 1995-217 dated 20 December 1995, as modified in Notice of Public Hearing CRTC 1996-6 dated 10 May 1996.

The service herein authorized, to be known as Homestar, will derive its revenues entirely from subscription fees, and will provide programming services exclusively to individual subscribers in all parts of Canada on a DTH basis.

Shaw proposed that Homestar will distribute a basic service consisting of the services of the CBC English-language and French-language television networks, the CTV Television Network Ltd. (CTV), Television Northern Canada (TVNC), and the Cable Public Affairs Channel (CPAC). In addition, Homestar will provide optional tiers consisting of conventional broadcast, specialty and pay TV programming in both English- and French-language packages, as well as several bilingual tiers. All subscribers to Homestar's service will have access to licensed DTH pay-per-view (PPV) programming services without a buy-through requirement. Homestar will also offer Canadian digital audio services on an optional basis.

Shaw stated that it will distribute programming services in accordance with the government's satellite policy. The licensee's plans and options with respect to the satellite delivery of its service are examined in a later section of this decision.

The approval granted herein shall only be effective, and the licence shall only be issued, at such time as:

a)  the Commission receives documentation establishing that an eligible Canadian corporation has been incorporated in accordance with the application in all material respects and that it may be issued a licence; and

b)  the undertaking is prepared to commence operations. The licence shall not be issued if this undertaking is not in operation within 12 months of the date of this decision, or, where the licensee applies to the Commission within this period and satisfies the Commission that it cannot complete implementation before the expiry of this period and that an extension is in the public interest, within such further periods of time as are approved in writing by the Commission. The licensee shall advise the Commission in writing once it is prepared to commence operations.

Subject to the foregoing, the Commission will issue a licence to carry on a national DTH satellite distribution undertaking, expiring 31 August 2002. This date coincides with the expiry date of the licences in respect of the three other national DTH satellite distribution undertakings already licensed by the Commission. The licence will be subject to the conditions specified in the appendix to this decision and in the licence to be issued.

Cable Ownership of a DTH Undertaking

Homestar will be wholly owned and controlled by Shaw, the second largest cable operator in Canada. Shaw also controls the English-language television specialty services YTV, Country Music Television and Treehouse. In addition, Shaw controls DMX Canada (1995) Ltd., which is licensed to provide a national pay audio service, as well as ten radio stations.

Shaw's ownership, however, raises two central issues related to competition. First, certain interveners to the proceeding expressed concern that a DTH undertaking owned by a cable operator would not have any incentive to compete vigorously for subscribers, thereby reducing competition and choice in the DTH market. This would be contrary to the Government of Canada's Order-in-Council P.C. 1995-1105 which provides direction to the Commission on policies to govern the licensing of DTH satellite distribution undertakings as well as the Commission's policy (Public Notices CRTC 1993-74 and 1995-217).

In addition, certain interveners argued that a cable-owned DTH service would have opportunities for cross-subsidization and preferential treatment stemming from its cable operations, for example, in negotiations with third parties regarding the provision and cost of programming, choices of technology, arrangements regarding satellite space and other matters. Other interveners, however, including Star Choice Television Network Incorporated (Star Choice), did not oppose Shaw's application, provided that effective safeguards to ensure fair competition are implemented.

With regard to the interveners' concern that, as a cable-owned DTH service, Homestar will have no incentive to compete energetically for subscribers, the Commission notes that it has already licensed three DTH distribution licensees, namely Joel Bell, on behalf of a company to be incorporated (Power DirectTV), ExpressVu Inc. (ExpressVu) and Star Choice. ExpressVu and Star Choice are expected to commence operations in 1997. At a public hearing held at Montréal beginning on 2 December 1996, the Commission heard an application by AlphaStar Canada Inc. for a licence to operate an additional national DTH distribution undertaking. For its part, Homestar forecast a launch date of September 1997, explaining that it needs at least six to nine months from the date of licensing to become operational.

Based on the foregoing, the Commission expects that Homestar will not be the first Canadian DTH service to commence operations. The earlier Canadian DTH entrants will, thus, have first access to the market sector consisting of subscribers who are the most motivated to purchase a Canadian DTH service. The Commission is satisfied that sufficient incentive will exist for Homestar to compete vigorously in all cable markets, including those licensed to Shaw-controlled companies, rather than risk losing those DTH and cable subscribers to other DTH competitors.

With regard to the concerns expressed by some interveners that Shaw will have the opportunity to subsidize Homestar and provide undue preference to this service through Shaw's position as Canada's second-largest cable operator, the Commission notes that the applicant made a commitment to operate Homestar separately from Shaw. Homestar will have its own accounting processes, its own staff and facilities, as well as its own billing and customer service, all of which will operate separately from Shaw. Furthermore, at the hearing, Homestar agreed to accept conditions of licence prohibiting the following:

·  cross-subsidization;

·  joint marketing of services provided by Shaw's cable services with those provided by Homestar;

·  obtaining or borrowing Shaw's cable services;

·  granting preferential treatment to Homestar's customers who are also subscribers to Shaw's cable services; and

·  sharing of information that is not publicly available from Shaw or from any company or other entity controlled directly or indirectly by Shaw.

Conditions of licence prohibiting such practices are set out in the appendix to this decision.

The Commission considers that Shaw's commitment to operate its DTH service as a separate business and the conditions of licence attached to this decision will ensure the necessary structural separation between Homestar and Shaw's cable operations. Further, the Commission is satisfied that there are reasonable competitive safeguards in place to promote fair competition and to prevent undue preference to Homestar that might otherwise arise from Shaw's ownership of the proposed service.

The Government's Satellite Policy

In a letter to the Commission dated 14 June 1995, the Government of Canada clarified its policy concerning the use of satellite facilities. The policy, as clarified, permits Canadian broadcasting undertakings to use either Canadian or non-Canadian satellite facilities to carry foreign-originated services that are intended primarily for foreign audiences and that are authorized by the Commission for distribution in Canada. The policy, however, stipulates that such undertakings "...should make use of Canadian satellite facilities to carry (i.e. receive and/or distribute to Canadians) all Canadian programming services ...". In the case of emergencies leading to lack of availability of Canadian satellite capacity, the policy allows for Canadian broadcasting undertakings to use non-Canadian satellite facilities to distribute Canadian programming services.

Satellite Delivery Options

Given the shortage of Canadian satellite space segment available at this time, particularly for DTH distribution undertakings, Shaw's application raises the issue of whether the applicant has secured satellite capacity, or has adequately formulated strategies to obtain such capacity. Furthermore, the Commission wishes to ensure that such capacity would be utilized in accordance with the requirements of the government's satellite policy.

In the long term, Shaw plans to use whatever new Canadian DBS satellite capacity becomes available to it over the next two years. Shaw indicated that it had filed an application with the Department of Industry to launch two DBS satellites through Shaw DBS, a structurally-separate company, and noted that Telesat Canada (Telesat) had filed a similar competing application. In the meantime, Shaw proposed that Homestar could find interim satellite capacity on Telesat's Anik E2 satellite through a traffic-planning scenario devised by Shaw. Shaw further claimed that if Telesat is unable to accommodate Homestar on the Anik satellites, Homestar could find interim capacity on existing U.S. DBS or U.S. medium-power satellites.

In its intervention, Telesat stated that, in the immediate future, it cannot accommodate Homestar on Telesat's current facilities. Among other things, Telesat stated that its first priority is to restore service to its customers affected by Anik E1's partial failure. Telesat also presented evidence that ExpressVu and other customers are higher than Homestar on the Order of Priority List (OPL) for available satellite capacity. In its intervention, Star Choice stated that it also is ahead of Homestar on the OPL.

Telesat also argued that Shaw's proposal to use U.S. satellite capacity may not be feasible because U.S. providers of such capacity require long-term service contracts that may put Canadian DTH undertakings entering into such contracts offside of the government's satellite policy, once Canadian satellite capacity becomes available.

The Commission acknowledges Telesat's concerns that the interim options proposed by Shaw to obtain satellite capacity are uncertain. Nevertheless, the Commission notes that the current environment regarding satellite capacity is subject to rapid and sometimes unforeseeable changes. As to Shaw's long term proposal, the Commission expects that new Canadian satellites will become available over the next few years, and that Canadian DTH services will have access to these common carrier facilities.

The Commission does not consider that Shaw's inability to present evidence that it has been able, unconditionally, to secure interim satellite capacity at this time is sufficient grounds to deny this application. The Commission is satisfied that Shaw has identified several alternative satellite strategies available to it.

The Production Fund

One of the issues discussed at the hearing was Shaw's proposed contributions to the production of Canadian programming. As the Commission stated in Public Notice CRTC 1995-217, it generally requires the licensees of DTH distribution undertakings and DTH pay-per-view television programming undertakings to fund Canadian program production by making contributions representing no less than 5% of the gross annual revenues derived from their broadcasting activities to an existing, independently-administered Canadian program production fund. In its application, Shaw indicated that it planned to allocate 3% of its gross annual revenues to a yet-to-be named, independently administered production fund. Shaw further proposed that, over Homestar's initial five years of operation, it would direct a further 2% to support TVNC's programming. Noting that it plans to serve communities across northern Canada, Shaw argued that its proposal to allocate 2% of its contributions to TVNC, which serves 95 northern communities, would "strengthen the range of programming and the access to community information to those communities".

TVNC, however, does not qualify as an existing, independently-administered Canadian production fund. The Commission notes that at the hearing Shaw conceded that it should have identified an independent, arm's length production fund to administer that 2% funding. Furthermore, the Commission notes that the Alliance of Canadian Cinema, Television and Radio Artists (ACTRA) and the Canadian Film and Television Production Association opposed Shaw's request, arguing that distributors should direct their contributions to existing program production funds.

The Commission considers that an exception to the existing DTH policy set out in Public Notice CRTC 1995-217 regarding funding contributions to Canadian program production is not warranted in this case. Accordingly, by condition of licence, the licensee is required to contribute a minimum of 5% of the gross annual revenues earned by the broadcasting activities of its DTH distribution undertaking to an existing, independently-administered, Canadian program production fund.

As part of this condition, the licensee is required to report to the Commission, prior to commencing operations, identifying the existing fund to which it will make its contributions. The licensee is further required to remit its contributions in the form of monthly instalments, the first to be made within 45 days of the end of the month in which it commences operation and, thereafter, within 45 days of each month's end, and representing a minimum of 5% of that month's gross revenues earned.

The Commission notes the important commitment made by Shaw to provide northern residents with free decoders and to obtain copyright clearance for programming distributed on Homestar to schools in northern communities.

In Public Notice CRTC 1996-159, the Commission transferred oversight of the Cable Production Fund (CPF) to the Department of Canadian Heritage, which oversees the operation of the Canadian Television and Cable Production Fund (CTCPF). The Commission, in that public notice, encouraged licensees who have not made a commitment to a specific fund to allocate their contribution to the CTCPF. In this regard, the Commission notes that the CTCPF has announced that it will provide support for aboriginal programming under its Licence Fee Program and its Equity Investment Program.

DTH Distribution Regulatory Framework

In Public Notice CRTC 1995-217, the Commission outlined the regulatory framework that it expected to apply to DTH satellite distribution undertakings. Such undertakings constitute a class of undertakings for which, at present, there are no applicable regulations. In Public Notice CRTC 1996-69, the Commission announced a public process for the purpose of establishing comprehensive regulations applicable to all broadband, subscription-based distribution undertakings, including DTH undertakings. Accordingly, and until the new regulations are in place, the licensee is required, by condition of licence, to adhere to sections 5, 6 and 19 and Part IV of the Cable Television Regulations, 1986 respecting transfers of control and ownership, the submission of information, the alteration and curtailment of programming services, and the mediation and resolution of disputes.

Authorized Programming Services

The licensee is authorized, by condition of licence, to distribute the signals of the programming services listed in the appendix to this decision, in accordance with the terms set out therein.

The Commission authorized other DTH distribution licensees, by condition of licence, to distribute the signal of any licensed television programming undertaking, unless the licensee of the programming service objected in writing to the Commission or to the DTH undertaking, within 90 days of the date of the DTH licensing decision. Canwest Global System (Canwest), in its intervention, requested that the Commission instead specify that the authorization to carry a programming service be subject to the DTH licensee receiving prior written consent of the television licensee. In support of its request, Canwest noted that it has many programs under contracts that specifically preclude distribution by DTH undertakings.

The Commission has considered the intervener's argument, but does not consider that CanWest has presented any evidence to warrant a change to this condition of licence in the case of Homestar.

In its intervention, TVNC requested that the Commission require Homestar to carry TVNC's service as part of the basic service package. The Commission notes that, in its application, Shaw made a commitment to carry TVNC on basic service. In the circumstances, the Commission does not consider that a condition of licence is required.

Access Requirements

In accordance with the policy set out in Public Notice CRTC 1996-60 entitled "Access Rules for Broadcasting Distribution Undertakings", the licensee is required to distribute, at its own cost, the services of all licensed English- and French-language specialty and pay television programming undertakings, subject to available satellite capacity. In addition, the licensee is required to distribute, at its own cost, at least one English- and one French-language general interest DTH PPV television programming service, again subject to available satellite capacity.

Should the licensee elect to distribute a pay audio service in which it or another distribution undertaking has an ownership interest exceeding 30%, it must also, pursuant to a condition of licence, distribute at least one other pay audio service, whose ownership is independent of any distribution undertaking, with the terms of the discretionary carriage to be agreed upon by the DTH operator and the originator of the programming service. In order to qualify for such access, it would be the responsibility of the pay audio service to pay the satellite uplink and transmission costs associated with the distribution of the signal.

Distribution and linkage requirements

Consistent with Public Notice CRTC 1995-217, the Commission requires, by condition of licence, that each subscriber receive a preponderance of Canadian programming services. In other licence conditions set out in the appendix to this decision, the Commission requires that the licensee adhere to specified linkage and distribution rules. The licensee is also required, by condition of licence, to adhere to rules governing program substitution and deletion, and to offer a basic service that includes the CBC French- and English-language television network services, as well as a CTV television network signal. These conditions have been attached to the licences of other DTH distribution licensees as well.

In its application, Shaw requested that Homestar be permitted, in its French-language pay television discretionary tier, to link Super Écran with a "U.S. 4+1" network package that is not on the Commission's List of Eligible Satellite Services. Shaw argued that the services contained in the proposed "U.S. 4+1" network package have been traditionally available to Quebec viewers and are more recognized by them than other services on the List of Eligible Satellite Services.

The Commission considers that Shaw's proposal is reasonable. Accordingly, the Commission is adding the "U.S. 4+1" stations originating in Buffalo, New York to the list of authorized services set out in Homestar's conditions of licence contained in the appendix to this decision.

Copyright Issues

In its intervention, CTV asked the Commission to make certain statements relating to copyright issues. The Commission notes, however, that CTV, itself recognized that any statement by the Commission on this issue would not be conclusive. In the Commission's view, this issue is one that, more properly falls within the jurisdiction of the Copyright Board.

Employment Equity

In Public Notice CRTC 1992-59 dated 1 September 1992 and entitled "Implementation of an Employment Equity Policy", the Commission announced that the employment equity practices of broadcasters would be subject to examination by the Commission. In this regard, the Commission encourages the licensee to consider employment equity issues in its hiring practices and in all other aspects of its management of human resources.

Closed Captioning

The licensee should provide, as a minimum, at the output of each set-top decoder, a National Television Systems Committee (NTSC) television signal complete with its associated standard monaural audio. It should also distribute any closed captioned signals that were present with the programming service when it was received by the undertaking at the input to its system. The Commission expects the licensee to acquire and publicize the availability of a telecommunication device for the deaf (TDD).

Interventions

The Commission acknowledges the interventions submitted both in support of and in opposition to this application, as well as those interventions offering comments on Shaw's proposal.

This decision is to be appended to the licence.

Allan J. Darling
Secretary General

Appendix to Decision CRTC 97-38

Conditions of Licence

1.  The licensee shall adhere to the provisions contained in sections 5, 6 and 19, and in Part IV of the Cable Television Regulations, 1986 (the cable regulations).

2.a)  Unless otherwise prohibited by the Commission, and subject to the following, the licensee is authorized to distribute the signal of any licensed television programming undertaking. The licensee is authorized to distribute such a service unless the licensee of that service objects in writing to its carriage, both to the Commission and to the distribution undertaking, within 90 days of the date of this decision. The licensee is also authorized to distribute the services of all other licensed or exempt programming undertakings (other than a pay television programming undertaking that provides a pay-per-view service). The licensee is also authorized to distribute, in each official language, an Electronic Program Guide, a pay-per-view marketing channel, and a marketing channel for its service.

b)  Unless otherwise prohibited by the Commission, the licensee is authorized to distribute the following non-Canadian programming services:

 WKBW-TV Buffalo (ABC)
 WGRZ-TV Buffalo (NBC)
 WIVB-TV Buffalo (CBS)
 WUTV-TV Buffalo (FOX)
 WNED-TV Buffalo (PBS)
 The Nashville Network (TNN)
 The Arts and Entertainment Network (A&E)
 Cable News Network (CNN)
 The Weather Channel (TWC)
 CNN Headline News (CNN-2)
 The Silent Network (Kaleidoscope)
 The Learning Channel
 CNBC/FNN*
 Cable Satellite Public Affairs Network (C-Span)
 WGN-TV Chicago
 WWOR-TV New York City
 WTBS Atlanta
 WPIX New York City
 WSBK-TV Boston
 KTLA Los Angeles
 Black Entertainment Television (BET)
 Lifetime Television
 Comedy Central

 *Pursuant to CRTC Circular Letter No. 377, dated 5 June 1991, the licensee is authorized to distribute only the 6:00 a.m. to 7:00 p.m. (ET) Monday to Friday programming component of CNBC/FNN.

3.  The licensee shall offer a basic service that includes the signals of at least one of each of the CBC English- and French-language television network affiliates or member stations and at least one affiliate of the CTV English-language television network. Every subscriber must subscribe to the basic service to receive any discretionary services, except the DTH pay-per-view services.

4.a)  For the purpose of this condition, the term "identical" shall have the same meaning as that set out in section 2 of the cable regulations.

b)  Where the licensee receives, at least seven days before the date on which the programming is broadcast, a written request for substitution or deletion from the operator of a licensed Canadian television programming undertaking, the licensee shall:

i)  delete a non-Canadian television programming service and substitute the identical programming service of the Canadian television programming undertaking whose signal is also distributed by the licensee; and

ii)  delete a programming service that is identical to that of the Canadian television programming undertaking and that is receivable by subscribers located within the grade B contour of the Canadian television programming undertaking.

c)  The licensee may discontinue a deletion and/or substitution made pursuant to paragraph b) where the licensee verifies that the programming service in respect of which the deletion or substitution is made is not, or is no longer, identical.

5.a)  For the purposes of this condition, "identical", in respect of two or more programming services, means that not less than 95 per cent each of the video and audio components of those programming services, exclusive of commercial messages and any part of the services carried on a subsidiary signal, are the same and are broadcast on a non-simultaneous basis within the same broadcast week; "broadcast week" shall mean a period of seven consecutive days beginning on Sunday; "commercial message" shall have the same meaning as that set out in section 2 of the cable regulations.

b)  Where the licensee receives, at least seven days before the date on which the programming is broadcast, a written request for deletion from the operator of a licensed Canadian television programming undertaking, the licensee shall delete a programming service that is identical to that of the Canadian television programming undertaking and that is receivable by subscribers located within the grade B contour of the Canadian television programming undertaking.

c)  The licensee may discontinue a deletion made pursuant to paragraph b) where the licensee verifies that the programming service in respect of which the deletion is made is not, or is no longer, identical.

6.  The licensee shall ensure that no subscriber receives a total number of programming services that contains less than a preponderance of Canadian programming services.

 For the purpose of this condition, multiplex programming channels, repeat channels and non-programming channels will be disregarded and the service of each licensed direct-to-home (DTH) pay-per-view (PPV) undertaking distributed will be counted as a single service.

7.  The non-Canadian programming services listed below may only be offered in a discretionary package with Canadian pay television and/or Canadian specialty services, and are subject to the following linkage requirements:

a)  Each Canadian pay television service (excluding a Canadian direct-to-home pay-per-view television service) may be linked in a single discretionary package with no more than five channels of the following authorized non-Canadian programming services:

 The Nashville Network (TNN)
 The Arts and Entertainment Network (A&E)
 Cable News Network (CNN)
 The Weather Channel (TWC)
 CNN Headline News (CNN-2)
 The Silent Network (Kaleidoscope)
 The Learning Channel
 CNBC/FNN
 Cable Satellite Public Affairs Network (C-Span)
 WKBW-TV Buffalo (ABC)
 WGRZ-TV Buffalo (NBC)
 WIVB-TV Buffalo (CBS)
 WUTV-TV Buffalo (FOX)
 WNED-TV Buffalo (PBS)
 WGN-TV Chicago*
 WWOR-TV New York City*
 WTBS Atlanta*
 WPIX New York City*
 WSBK-TV Boston*
 KTLA Los Angeles*
 Black Entertainment Television (BET)
 Lifetime Television
 Comedy Central

*U.S. Superstations

In no case, however, can a single discretionary package, whose Canadian component includes more than one pay television service, contain more than five channels of non-Canadian programming services, linked with those Canadian pay television services.

b)  Each Canadian specialty service, distributed within a discretionary package that may include one or more Canadian specialty and/or pay television services, may be linked with no more than one channel of the following authorized non-Canadian programming services:

 The Nashville Network (TNN)
 The Arts and Entertainment Network (A&E)
 Cable News Network (CNN)
 The Weather Channel (TWC)
 CNN Headline News (CNN-2)
 The Silent Network (Kaleidoscope)
 The Learning Channel
 CNBC/FNN
 Cable Satellite Public Affairs Network (C-Span)

c)  The licensee may designate one of the U.S. superstations authorized in paragraph a) above and distribute the signal of that superstation within a discretionary package that may include one or more Canadian specialty and/or pay television services.

d)  The licensee is not permitted to offer a package of services containing only non-Canadian programming services.

e)  The licensee is not permitted to link authorized non-Canadian programming services with a Canadian specialty service distributed on the basic service.

8.  The licensee shall, in each broadcast year (i.e. the period from 1 September to the following 31 August), contribute to an existing, independently-administered, Canadian program production fund a minimum of 5% of the annual gross revenues earned by its broadcasting activities. The licensee is also required to report to the Commission, prior to commencing operations, identifying the name of the existing fund to which it will make its contributions. The licensee shall remit its contributions in the form of monthly instalments, representing a minimum of 5% of each month's gross revenues, payable within 45 days of the end of the month in question. The first instalment shall be due within 45 days of the end of the month in which the licensee commences operations.

9.  The licensee is prohibited from distributing any pay-per-view service other than that of a licensed direct-to-home (DTH) pay-per-view (PPV) television programming undertaking.

10.  The licensee must distribute at least one French-language direct-to-home (DTH) pay-per-view (PPV) service where it distributes one or more English-language DTH PPV services.

11.  The licensee, if it elects to distribute a pay audio service in which it or another distribution undertaking has an ownership interest exceeding 30%, must also distribute at least one other pay audio service whose ownership is independent of any distribution undertaking, with the terms of the discretionary carriage to be agreed upon by the licensee and the originator of the programming service.

12.  For any programming of a service that is originated by the licensee, the licensee shall adhere to the guidelines on the depiction of violence in television programming set out in the Canadian Association of Broadcasters' "Voluntary Code Regarding Violence in Television Programming", as amended from time to time and approved by the Commission. A majority of the licensee's board of directors shall be persons who are not members of the board of directors of Shaw Communications Inc. or of the board of directors of any company or other entity controlled directly or indirectly by Shaw Communications Inc.

14.  The licensee shall not obtain or accept any information which is not publicly available from Shaw Communications Inc. or from any company or other entity controlled directly or indirectly by Shaw Communications Inc.

15.  No employee of the licensee, or individual providing services on a contractual basis to the licensee, shall, at the same time, be employed by Shaw Communications Inc. or by any company or other entity controlled directly or indirectly by Shaw Communications Inc.

16.  The licensee shall operate its undertaking in a manner that is independent of, and separate and distinct from, the operations of Shaw Communications Inc. and all companies or other entities controlled directly or indirectly by Shaw Communications Inc. For greater certainty, this condition of licence shall be interpreted to prohibit the licensee from activities which include the following:

·  offering, selling or promoting any of its services together with any of the services of Shaw Communications Inc. or any company or other entity controlled directly or indirectly by Shaw Communications Inc., or permitting any of its services to be so offered, sold or promoted (but

 this shall not prohibit the licensee from offering, selling and promoting the programming service of any licensed programming undertaking as part of its service package);

·  billing for any of its services together with any of the services of Shaw Communications Inc. or any company or other entity controlled directly or indirectly by Shaw Communications Inc.;

·  offering or providing customer service to its subscribers together with the subscribers of any company or other entity controlled directly or indirectly by Shaw Communications Inc.; and

·  using in its operations any services, including accounting services, or facilities provided by or owned by Shaw Communications Inc. or any company or other entity controlled directly or indirectly by Shaw Communications Inc.

17.  The licensee shall offer and provide its services on the same terms and conditions to all persons who reside within the licensed area of a cable distribution undertaking licensed to a company or other entity controlled directly or indirectly by Shaw Communications Inc. and shall not offer different terms or conditions dependent upon whether or not a person subscribes to cable service.

18.  The licensee shall not enter into arrangements with licensees of programming undertakings or with other persons providing programming services to obtain programming services on an exclusive or preferential basis.