ARCHIVED -  Decision CRTC 99-42

Decision

Ottawa, 22 February 1999

Decision CRTC 99-42

Television Northern Canada Incorporated

Across Canada - 199804068

12 November 1998 Public Hearing
National Capital Region

Summary

The Commission approves the application by Television Northern Canada Incorporated (TVNC) to operate a national Aboriginal programming network, to be known as the Aboriginal Peoples Television Network (APTN). The Commission will issue a single licence for a satellite-to-cable programming undertaking, including existing television transmitters in Northern Canada, expiring 31 August 2005. The new undertaking will be regulated pursuant to the Television Broadcasting Regulations, 1987.

In approving this application, the Commission has taken into consideration the substantial support expressed by interveners for a national Aboriginal television service. APTN will offer a high-quality, general interest television service with a broad range of programming that reflects the diverse perspectives of Aboriginal peoples, their lives and cultures. APTN will, thus, provide a much-needed, positive window on Aboriginal life for all Canadians, whether living in the North or in the South. The schedule will include programming in English, French and up to 15 different Aboriginal languages.

Class 1 and Class 2 distribution undertakings (including multipoint distribution system (MDS) undertakings) and direct-to-home (DTH) distribution undertakings will be required to distribute APTN as part of the basic service. The Commission encourages Class 3 distribution undertakings to distribute ATPN, when available, on the same basis.

The Commission authorizes APTN to charge a maximum monthly fee of $0.15 per subscriber. APTN will be available free of charge in the 96 communities in the North that currently receive TVNC's service over the air.

The Commission has also issued Public Notice CRTC 1999-31 today. It includes a proposed Order to implement this decision, effective 1 September 1999 (or when the service begins operation, should this be after 1 September 1999), in accordance with section 9(1)(h) of the Broadcasting Act (the Act).

Background

1.  TVNC, a not-for-profit corporation, was licensed in 1991 as a "native television network ... to serve northern Canada for the purpose of broadcasting cultural, social, political and educational programming for the primary benefit of Aboriginal people in the North" (Decision CRTC 91-826). TVNC filed the present application following the Commission's public hearing, in November 1997, regarding the issue of establishing additional national television networks. TVNC appeared at the 1997 public hearing to argue that its service should be available to southern Aboriginal peoples and other Canadians and that its service should become national in scope.

2.  Following that public hearing, the Commisison issued a report regarding the possibility of establishing additional national television networks (see Public Notice CRTC 1998-8). In that report, the Commission recognized that TVNC is a unique and significant undertaking serving the public interest and the objectives of the Act, especially those objectives that relate to the special place of Aboriginal peoples within Canadian society. The Commission stated that such a service should be widely available throughout Canada in order to serve the diverse needs of the various Aboriginal communities, as well as other Canadians. In addition, the Commission indicated that it would consider any application by TVNC designed to achieve these objectives.

The proposed service

3.  APTN will be programmed predominantly by Aboriginal peoples and will reflect their concerns and the diversity within their cultures. As the applicant stated, APTN will be a "celebration of our rich heritage and a sharing of our ideas... within the native community and with fellow Canadians". It will broadcast a broad range of programming targeted to a variety of age groups and interests: over 120 hours of programming each week, including children's shows, educational programming, cultural and current affairs, drama, music, comedy, documentary features, discussion programs, political coverage, special events and programming about indigenous people around the world. APTN's news and information programs will fill a gap in the Canadian broadcasting system by providing a perspective that is currently not available.

4.  Since APTN will be available across the country, it will offer a positive window on Aboriginal life and culture for all Canadians. In the applicant's own words, APTN "will contribute to a cross-cultural environment of mutual trust and respect ... we are confident that non-natives will be amazed at what they see. They will marvel at our stories, our value systems and our sense of humour. They will become much more knowledgeable about our culture and the issues that affect our lives".

5.  The applicant argued that APTN will provide a primary level of service for Aboriginal peoples. It claimed that APTN should, therefore, be included in the basic service with other core services. The applicant also contended that access to distribution systems in southern Canada will allow it to generate new revenues through subscription fees and advertising sales. It noted that a large portion of the revenues for its current over-the-air service is derived from public sources and that this funding has been substantially reduced in recent years.

The Commission's rationale for approval

6.  In its evaluation, the Commission has taken into consideration the substantial support for APTN expressed in the numerous interventions submitted by Aboriginal and non-Aboriginal individuals and groups, artists, broadcasters and producers. In the words of one intervener, APTN will be a "gift to the country, benefiting not only the Aboriginal people, but all other parts of the cultural mosaic that is Canada." Interveners supported APTN because it will offer positive role models for youth. As one intervener stated, APTN will "give a strong voice to a lot of children and youth ... and give them the message that there is something out there for us, that we can become something, we can live up to our dreams". Still another intervener stated that APTN will finally provide a "forum that has not been previously available for Aboriginal artists and producers to exhibit their work".

7.  The Commission also examined APTN's proposal in light of the objectives set out in the Act and the benefits that approval of the application would bring to the Canadian public and to the Canadian broadcasting system as a whole. In addition, the Commission considered the means to implement APTN's service in the most timely and effective manner possible.

8.  Section 3 of the Act states that:

 The Canadian broadcasting system should ... serve the needs and interests, and reflect the circumstances and aspirations, of Canadian men, women and children, including equal rights, the linguistic duality and multicultural and multiracial nature of Canadian society and the special place of Aboriginal peoples within that society.

9.  It further states that "programming that reflects the Aboriginal cultures of Canada should be provided within the Canadian broadcasting system as resources become available for the purpose".

10.  The Commission considers that Aboriginal peoples should have access to a national television service to exchange information, ideas, entertainment and cultural perspectives. Building on TVNC's experience in providing programming in the North, APTN will offer new, diverse programming with a high level of Canadian content that reflects the culture, history and concerns of Aboriginal peoples. Through this programming, APTN will provide social benefits by strengthening the cultural identity of Aboriginal peoples and offering a cultural bridge between Aboriginal and non-Aboriginal Canadians. The Commission has, therefore, determined that national distribution of APTN is in the public interest.

General programming commitments

11.  APTN committed to broadcast programming that "will reflect an appropriate balance among the needs of all Aboriginal people, including First Nations, Inuit and Metis" and is relevant to all regions of the country. The schedule will include 30 hours of programming in Aboriginal languages each week, with up to 15 different Aboriginal languages being used. The Commission expects the applicant to fulfill these commitments.

12.  APTN also made a commitment to offer a minimum of 18 hours of French-language programming each week beginning in the first year of operation. Given that distributors are required to carry APTN in all regions of Canada, including Quebec, the Commission expects the applicant to adhere to this commitment. APTN further indicated that it will increase the level of French-language programming as the network matures.

13.  The service will broadcast a very high level of Canadian programming. Consistent with the applicant's commitments, a condition of licence is set out later in this decision requiring APTN to devote not less than 90% of both the broadcast week and the evening broadcast period to Canadian programs.

14.  Consistent with commitments made by the applicant at the hearing, the Commission expects APTN to provide, by the end of the licence term, either closed or open captioning for 100% of its in-house productions and for at least 90% of the English-language independently-produced programming that it broadcasts.

Commitments regarding Drama, Music and Dance and Variety Programming

15.  ATPN also made several commitments to broadcast Canadian programming in under-represented categories: category 7 (drama), category 8 (music and dance) and category 9 (variety). Specifically, it will broadcast 4 hours of such programming each week, during the evening broadcast period, for the first three years of operation. In each subsequent year of the licence term, APTN will broadcast a minimum of 5 hours of such programming each week, of which a minimum of one hour each week will be original programming. The Commission expects the applicant to adhere to these commitments.

16.  Consistent with the applicant's commitments, the Commission expects APTN to spend the following amounts on Canadian programming in under-represented categories to be broadcast during the evening broadcast period:

·  $1 million during the first year of operation;

·  $1.5 million in the second and third years of operation; and

·  $1.65 million each year thereafter.

17.  APTN will allocate all of its program development funds to programs in the under-represented categories. Specifically, the applicant will spend at least $55,000 in year one of operation, $60,000 in year two, and $35,000 in each remaining year of the licence term on the development of programs in the under-represented categories.

Commitments regarding regional reflection

18.  In Public Notice CRTC 1998-8, the Commission stated that it would expect any application by TVNC to extend its service across Canada "to demonstrate how it will adapt its programming service to reflect the diversity of the needs and interests of Aboriginal peoples throughout Canada". APTN has made several commitments to help ensure that the programming reflects the needs and interests of Aboriginal peoples living in all regions of the country.

19.  The first initiative relates to the structure of the Board of Directors. At the hearing, TVNC described its plans for expanding its board to ensure that it will be truly representative of the whole country. The board will consist of 21 members, including 10 members representing northern Canada and 9 members representing southern Canada, as well as at least one member representing eastern Canada, and one member representing western Canada. Consistent with these commitments, a condition of licence requiring regional representation on APTN's board of directors is set out later in this decision. The Commission expects the applicant to provide a list of new board members as they are appointed.

20.  Further, in order to ensure that programming is relevant to viewers in southern Canada as well as to those in the North, APTN plans to broadcast up to 30 hours each week of programming acquired from independent producers in southern Canada. An independent selection committee will select all acquired series programming.

Carriage of APTN

21.  APTN asked to be distributed on a mandatory basis as part of the basic service of Class 1 and Class 2 distribution licensees pursuant to section 17(5) of the Broadcasting Distribution Regulations (the regulations), and by DTH distribution licensees pursuant to section 37(b) of the regulations. The applicant also requested distribution of its proposed service as part of the basic service of Class 3 terrrestrial distribution undertakings on an optional basis. In addition, APTN asked to be authorized to charge a maximum monthly fee of $0.15 per subscriber.

22.  Although the Commission added TVNC to the lists of eligible satellite services in 1995, few distributors in southern Canada have chosen to distribute the service. The Commission considers it vitally important that APTN's new and unique service be available to all Canadians, consistent with the objectives of the Canadian broadcasting policy. For this reason, and in view of the limited distribution that TVNC has received, the Commission has decided to utilize one of the regulatory tools available to it to ensure APTN wide distribution across Canada. Accordingly, pursuant to section 9(1)(h) of the Act, the Commission has granted APTN mandatory carriage as part of the basic service of Class 1 and Class 2 distribution undertakings (including MDS undertakings) and DTH distribution undertakings. The Commission considers that distribution of APTN as part of the basic service is necessary to ensure that it will be widely available across the country. The Commission also considers that a maximum fee of $0.15 per subscriber per month, in all markets, will enable APTN to generate the revenues needed to maintain this service. A condition of licence in this regard is set out later in this decision.

23.  The Commission recognizes that analog channel capacity is limited and that some cable systems may not have vacant channel capacity. In most cases, however, distributors will be able to add APTN with minimal disruption to their channel lineups. Furthermore, APTN indicated that it is willing to be distributed on channels located higher than 60 on the channel dial, as well as on impaired channels if the degree of impairment is not severe.

24.  Although APTN proposed a different mechanism for implementing mandatory carriage, the applicant stated at the hearing that it would accept the use of section 9(1)(h) of the Act to effect mandatory carriage on basic service. Section 9(1)(h) stipulates that "the Commission may, in furtherance of its objects"

 (h) require any licensee who is authorized to carry on a distribution undertaking to carry on such terms and conditions as the Commission deems appropriate, programming services specified by the Commission.

25.  The Commission considers that this mechanism will achieve the objective of national distribution of APTN in the most direct and effective manner.

26.  In a related public notice released today (Public Notice CRTC 1999-31), the Commission has announced a proceeding to seek comments on the terms and conditions of a proposed Order issued under section 9(1)(h) of the Act as a means of implementing this decision. This Order will require Class 1 and Class 2 distribution undertakings (including MDS undertakings) and DTH distribution undertakings to distribute APTN as part of their basic service, effective 1 September 1999 (or when the service begins operation, should this be after 1 September 1999).

27.  In Public Notice CRTC 1999-31, the Commission invited the public and other interested parties to submit to it, by 15 March 1999 their comments on the proposed Order. TVNC will be given one week in which to reply to comments.

28.  The Commission notes that other television licensees reflect Aboriginal issues and perspectives in their programming and expects them to continue to do so for the benefit of all Canadians.

Interventions

29.  The Commission received over 300 supporting interventions and letters. Virtually all interveners, including the Canadian Cable Television Association (CCTA) and cable operators, supported licensing APTN. At the same time, the CCTA, Shaw Communications Inc. and Rogers Cablesystem Limited, advocated licensing APTN on a digital-only basis with optional carriage via the eligible satellite services list as a backup measure, despite the severely reduced penetration that this option would make possible. Other interveners, as well, opposed the request for mandatory carriage.

30.  APTN responded that its service needs mandatory carriage in order to fulfill key objectives of the Act. With regard to the proposal that APTN be licensed on a digital-only basis, the applicant replied that it "is not an option: APTN could never be offered at a reasonable cost on digital and still meet its business plan." Furthermore, the Commission considers that there is still much uncertainty about the timing of a large scale digital roll out.

31.  The CCTA also argued that carriage of APTN would entail significant costs for cable operators. The intervener claimed that, among other expenses, cable distributors would have to pay monthly signal downlink fees of between $0.05 and $0.25 per subscriber charged by the satellite relay distribution undertaking distributing APTN. In response, APTN stated that it will arrange for distribution of its service and that Canadian Satellite Communications Inc. (Cancom) will provide the facilities for distribution. This arrangement means that cable distributors will not be required to pay any fees to Cancom for the distribution of APTN.

32.  The CCTA further claimed that the addition of APTN would cause cable operators to incur substantial costs in order to explain to their subscribers the channel lineup changes that would apt to result. The Commission considers it highly unlikely that the introduction of APTN alone will cause significant costs for cable operators, particularly in view of the fact that the addition of APTN will coincide with that of the specialty television services authorized in 1996, which are to be introduced by 1 September 1999. Moreover, the Commission considers that the expenses associated with changes in channel lineups are part of a distributor's normal costs of doing business.

33.  The Commission further notes the CCTA's estimation of the costs associated with the use of a channel to distribute APTN. The Commission acknowledges that there may be some costs associated with the lost opportunity to distribute another service on the channel used. Notwithstanding any such costs, the Commission considers that, in light of the policy objectives set out in section 3 of the Act, the distribution of APTN is warranted.

Conditions of licence

34.  The licence will be subject to the requirements specified in this decision and in the licence to be issued. As conditions of licence, the licensee:

(1)  must adhere to the Television Broadcasting Regulations, 1987, except as provided for by condition of licence number 2;

(2)  must devote not less than 90% of the broadcast year and not less than 90% of the evening broadcast period to the broadcasting of Canadian programs;

(3)  may, from the date of commencing operation, charge each broadcasting distribution undertaking distributing this service a maximum fee of $0.15 per subscriber per month;

(4)  must have 21 members on its Board of Directors, including ten members representing northern Canada, nine members representing southern Canada, and at least one member representing western Canada and one member representing eastern Canada;

(5)  must adhere to the guidelines on gender portrayal set out in the Canadian Association of Broadcasters' (CAB) Sex-role Portrayal Code for Television and Radio Programming as amended from time to time and approved by the Commission;

(6)  must adhere to the provisions of the Broadcast Code for Advertising to Children published by the CAB, as amended from time to time and approved by the Commission; and

(7)  must adhere to the guidelines on the depiction of violence in television programming set out in the CAB's Voluntary Code Regarding Violence in Programming, as amended from time to time and approved by the Commission.

Other matters

35.  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 applicant to consider employment equity issues in its hiring practices and in all other aspects of its management of human resources.

36.  The licence will only be issued and effective when the undertaking is ready to begin operation. When the licensee has completed construction and is prepared to commence operation, it must advise the Commission in writing. If the undertaking is not constructed and ready to operate within 12 months of today's date, extensions to this time frame may be granted provided that the licensee applies in writing to the Commission before the 12-month period or any extension of that period expires.

Secretary General

This decision is to be appended to the licence.

This document is available in alternative format upon request, and may also be viewed at the following Internet site:

www.crtc.gc.ca