ARCHIVED -  Decision CRTC 97-69

Decision

Ottawa, 13 February 1997

Decision CRTC 97-69

ExpressVu Inc.

Across Canada - 199607199

Licence amendment

In Public Notice CRTC 1996-104 dated 19 July 1996, the Commission announced an application by ExpressVu Inc. (ExpressVu) to amend its broadcasting licence to carry on a national direct-to-home (DTH) satellite distribution undertaking.

The Commission denies those parts of the application requesting authorization to delete the mandatory carriage of a CTV network signal in the licensee's French-language basic service package; and to allow its subscribers, rather than the licensee, to designate the one U.S. superstation that can be distributed within discretionary packages that may include one or more Canadian specialty and/or pay television services.

The Commission approves that part of the application requesting authorization to permit the licensee to provide Eastern, Central, Mountain or Pacific regional U.S. network signals for the four commercial networks (CBS, NBC, ABC and FOX) and one non-commercial network (PBS) distributed on its service, with a maximum of 5 U.S. network signals being offered as part of the basic service.

Deletion of CTV from the French-language basic service - Denied

In support of this request, ExpressVu stated that it wants to offer two basic packages, one consisting of French-language services and the other of English-language services. According to ExpressVu, these two basic packages will give subscribers the opportunity to purchase a core service in the language of their choice, without being obliged to acquire or pay for programming services that are of little interest, or value to them.

In Public Notice CRTC 1996-69 dated 17 May 1996, which sets out its proposed revised distribution regulations, the Commission stated that it intends, as previously stated in Public Notice CRTC 1995-217, to require DTH distribution undertakings to distribute, as part of the basic service, amongst other services, one station affiliated with each private television network which is licensed on a national basis.

The Commission considers that mandatory carriage of CTV on the basic service is a minimal obligation for DTH licensees. In this regard, the Commission notes that mandatory carriage of the CTV signal as part of the basic package should not result in additional costs for the DTH licensee because this service will, in any case, be uplinked for the English-language basic service. Accordingly, based on the foregoing, the Commission has denied this part of the application.

Selection of one U.S. superstation - Denied

In Public Notice CRTC 1995-217, the Commission required that U.S. superstations continue to be packaged exclusively with pay television services using a linkage ratio of 5:1. At the same time, the Commission granted DTH licensees a "minor exception" to these linkage requirements by allowing a DTH licensee to designate one of the U.S. superstations and to package the signal of that superstation with Canadian specialty services on a 1:1 linkage basis. ExpressVu is now asking the Commission to allow individual subscribers to select the particular U.S. superstation to be packaged as part of Canadian specialty and/or pay services on a discretionary tier. According to ExpressVu, such an option would be more consumer friendly and would allow the licensee to make the most of its fully addressable technology.

TMN Networks Inc. (TMN), licensee of The Movie Network and MOVIEPIX, Allarcom Pay Television Limited (APT), licensee of SuperChannel and MovieMax!, and The Family Channel Inc., licensee of The Family Channel, filed interventions opposing this request. These interveners, all licensees of pay television services, argued that approval of this request would alter the current arrangement of linking U.S. partners exclusively with pay services and would, consequently, have a negative impact on the marketing of pay television services and on their ability to contribute to the Canadian film production industry.

CanWest Global System (CanWest) also opposed this request on the grounds that, in many cases, foreign superstations do not acquire or hold rights for Canadian markets, whereas Canadian licensees do hold the Canadian rights for such programs. CanWest argued that Canadian licensees will "ensure that their programming complies with Canadian standards and values", and that it contributes to the Canadian broadcasting system.

The Commission has noted ExpressVu's response to these interventions.

The Commission notes that this policy set out in Public Notice CRTC 1995-217 was expressed as a "minor exception to the pay television linkage requirements". Furthermore, the Commission stated that this exception was intended to permit DTH licensees more flexibility "until such time as a more comprehensive review of the distribution and linkage policies applicable to all digital distribution undertakings can be undertaken". Since the impact of this exception on the packaging of pay services is still not completely known, the Commission does not consider that granting additional flexibility to this provision is warranted at this time.

Regionalization of the U.S. network services - Approved

Currently, ExpressVu is authorized, by condition of licence, to distribute four commercial U.S. network signals (CBS, NBC, ABC and FOX) and one non-commercial U.S. network (PBS) ("4+1"). All five U.S. signals are located within the Eastern time zone. ExpressVu is now requesting that it be permitted to carry "4+1" U.S. network signals from up to four different time zones to benefit its subscribers who are spread across different time zones. This amendment will allow ExpressVu to provide either Eastern, Central, Mountain or Pacific feeds of these networks corresponding with the subscribers' local time zone. The Commission notes ExpressVu's commitment to carry a maximum of five U.S. network signals on its basic service.

In support of this request, ExpressVu argued that regionalizing the U.S. network signals will enable the licensee to provide the maximum level of simultaneous substitution of programming, and will, therefore, promote Canadian networks. ExpressVu also claimed that being able to offer subscribers time-zone sensitive signals will make the licensee's signal delivery comparable with that of other Canadian distribution undertakings, and will give it competitive parity with U.S. "grey market" services.

The Commission notes that Star Choice Television Network Inc. (Star Choice), licensee of a national DTH distribution undertaking, is currently authorised to distribute regional "4+1" U.S. network services. Moreover, the Commission considers that approval of this request will create more opportunities for the licensee to offer simultaneous substitution of programming, rather than providing non-simultaneous deletion. Accordingly, the Commission has approved this part of the application.

Star Choice, in its intervention, indicated that ExpressVu had failed to provide sufficient information regarding the source supplier of the U.S. "4+1" network signals. In response, ExpressVu agreed that it should identify the source of its U.S. network signals, and stated that it would notify its subscribers and the Commission at least 30 days before any addition or change of signals.

The Commission requires ExpressVu to advise the Commission, 30 days before the licensee launches its service, regarding the source of all the U.S. signals to be distributed in each of the four time zones. The Commission will include the sources of the U.S. signals on ExpressVu's licence.

Interventions

The Commission acknowledges the 12 interventions submitted in response to the announcement of this application. Five of these interventions opposed the application, whereas seven interventions offered comments on the proposed amendments.

This decision is to be appended to the licence.

Allan J. Darling
Secretary General