ARCHIVED -  Public Notice CRTC 1999-74

Public Notice

Ottawa, 5 May 1999

Public Notice CRTC 1999-74

Review of the access rules for Canadian pay and specialty services in bilingual markets - Call for comments

Summary

In this public notice, the Commission invites Canadians to participate in a review of the access rules for pay and specialty services in bilingual markets. This review has been prompted by concerns expressed, in the context of various proceedings, regarding markets where Francophones form a significant, although not predominant, portion of the population. The Commission wishes to look at ways to better respond in the future to the needs of French-speaking subscribers in such markets.

The review is in keeping with the objectives of the Canadian broadcasting policy set out in the Broadcasting Act (the Act). The Act states that "a range of broadcasting services in English and in French shall be extended to all Canadians as resources become available".

The delivery of broadcasting services is moving from a monopoly-based market to a more competitive one. Over time, Canadians will have access to a wider variety of service providers, pricing and packaging options.

In this context and in light of the Canadian broadcasting policy, the Commission would like to examine, in particular, what measures, if any should be taken to provide for an adequate range of English-language and French-language services to be offered in the coming digital environment and in an expanded analog environment. It is raising questions aimed, in particular, at identifying bilingual markets, the distribution undertakings serving them, and the range of pay and specialty services that should be offered, as well as discussing the appropriate time to introduce these services.

Introduction

1. On 3 February 1999, the Commission issued a call for comments on the establishment of a licensing framework for new Canadian pay and specialty services (Public Notice CRTC 1999-19). It stated that:

The Commission considers that the programming provided by pay and specialty services makes an important contribution to the attainment of the objectives set out in section 3 of the Broadcasting Act. These services may provide an even wider variety of high quality Canadian programming as we move into a digital world with more channel capacity.

2. In that notice, the Commission called for comments on, among other things, the extent to which the access rules should apply to any new services that may be licensed. It added that: "The Commission will initiate a separate process shortly to consider the special case of access for new and existing pay and specialty services in bilingual markets".

3. The Broadcasting Distribution Regulations (the regulations) set out access rules governing the carriage of Canadian pay and specialty services. These rules ensure that licensed Canadian pay and specialty television services obtain access to distribution systems to the extent of available channel capacity.

4. Under section 18 of the regulations, the access rules apply to Class 1 licensees. At present, these rules apply to distribution undertakings that generally serve large urban areas. These licensees are generally required to distribute authorized pay and specialty services in the language of the market they serve. Those markets are defined in terms of the mother tongue of the majority of the population served, according to the most recent Statistics Canada data. The concept of a bilingual market is not recognized in the current regulations.

Scope of the review

5. The Canadian broadcasting policy set out in section 3 of the Act provides that the Canadian broadcasting system shall reflect Canada's cultural diversity and linguistic duality. Specifically, the Act states that:

A range of broadcasting services in English and in French shall be extended to all Canadians as resources become available. [s. 3(1)(k)]

6. The Act also recognizes the different operating conditions and requirements of English-language and French-language broadcasting. It states that the Canadian broadcasting system should be regulated and supervised in a flexible manner, taking those different conditions into account, and be readily adaptable to scientific and technological change [s. 5(2)]. The Act stipulates that distribution undertakings should give priority to the carriage of Canadian programming services [s. 3(1)].

7. Taking into account the objectives of the Canadian broadcasting policy set out in the Act, the Commission made a commitment to ensure, in terms of content, a strong and dynamic Canadian presence that faithfully reflects Canadian society, including its linguistic duality and cultural diversity.

8. In recent years, the Commission has approved an ever broader and more varied range of pay and specialty services in English and in French. On 7 December 1998 in Montréal, it considered applications for licences to operate new French-language specialty services. The Commission's decisions on those applications will be issued at a later date. The Commission's recent decisions approving national distribution of the TVA network's French-language service and the Aboriginal Peoples Television Network respond to the same objectives of cultural diversity and linguistic duality (Decisions CRTC 98-488 and 99-42).

9. To promote access to the available services, the Commission has sought to open up the broadcasting services distribution market to competition. This sector, dominated by cable, has in recent years witnessed the appearance of direct-to-home satellite broadcasting (DTH) and microwave multipoint distribution system (MDS) undertakings.

10. Over time, Canadians will have access to a wider variety of service providers, and pricing and packaging options for programming services. However, the full benefits that should be derived from a competitive framework have yet to be fully realized. Moreover, the replacement of analog channels by digital cable technology has not occurred on a significant level, delaying the increase in channel capacity and expansion of programming choice.

11. In this context, the Commission wishes to study ways to better respond to the special needs of bilingual markets. In particular, the Commission would like to examine access to Canadian pay and specialty services in those markets. It is seeking to determine whether it would be advisable to establish a more specific regulatory framework to that effect, in anticipation of an environment characterized by the advent of digital technology and possibly increased analog capacity. The Commission is soliciting comments from interested parties on the measures that could be taken, if appropriate, to ensure that an adequate range of broadcasting services available in designated markets.

12. The next section of this notice sets out the issues the Commission wishes to explore as part of this process and poses a number of related questions. nterested parties have until Wednesday, 4 August 1999 to provide their comments.

Matters for consideration

13. In light of the anticipated new environment for programming and distribution services, the Commission would like to explore whether it would be advisable to take measures to better respond to the needs of subscribers in bilingual markets. It is calling for comments on the following questions:

(1) What factors should the Commission take into account in achieving the objective stated in section 3(1)(k) of the Act? How should it balance this specific objective against the Act's other objectives?

14. As noted earlier, the access rules currently apply to Class 1 licensees. These undertakings have the largest number of subscribers and generally serve urban areas. There are, however, bilingual markets in areas served by Class 2 or Class 3 licensees. These markets consist of small communities that are scattered, but that may exhibit remarkable cultural vitality, and that quite legitimately wish to obtain broadcasting services in their language.

(2) Should the Commission require all classes of broadcasting distribution undertakings to provide an adequate range of English-language and French-language services in bilingual markets? If not, what criteria should the Commission use to identify the classes of undertaking that will be subject to the new service distribution requirements?

15. The current access rules identify markets in terms of the mother tongue of the majority of the population served. This criterion was established by Public Notice CRTC 1996-60, entitled Access Rules for Broadcasting Distribution Undertakings. These rules were subsequently incorporated into the regulations. A market is considered English-speaking or French-speaking if the population whose mother tongue is English or French accounts for over 50% of the total population in the service area of the distribution undertaking, according to the most recent Statistics Canada data.

16. These rules attempt to guarantee that, in general, the pay and specialty services authorized in the language of the majority of the population served will obtain access to the distribution undertakings, depending on available transmission capacity. Following this proceeding, the Commission may be called upon to identify the bilingual markets in which pay and specialty services should be offered in both English and French.

(3) What criteria should the Commission use to identify bilingual markets? Should it go beyond the sole criterion of the mother tongue? For example, should it use the statistical method applied in the Official Languages Act? This method combines data on knowledge of the first official language, the mother tongue and the language spoken at home. Once the criteria have been established, how should the Commission identify bilingual markets? Should the Commission use numerical or percentage thresholds, or a combination of the two, to identify bilingual markets? Are there alternate methods?

(4) What factors should the Commission take into account to establish the circumstances under which a distribution undertaking would be required to provide an adequate range of services in both English and French? For example, should it consider the demand from the communities? How should that demand be measured? Should the Commission take into account the cultural environment, such as the presence of educational institutions in one language or the other?

17. The current regulations single out the National Capital Region for the purposes of determining the order of priority to be granted to the distribution of programming services. Under section 17(6) of the regulations, the signals of all local television stations situated on the Ontario or Quebec side of the border have distribution priority in the National Capital Region. This provision has made it possible to broaden the range of English- and French-language television services distributed in that region.

(5) Should the Commission consider the National Capital Region, as described in the schedule to the National Capital Act, to be a bilingual market? Should a different "range" of services be distributed in this region?

18. The emergence of new technologies, such as digital transmission, suggests the possibility of increasing the transmission capacity of these undertakings and the choices available to subscribers.

(6) What would be an adequate "range" of services? Should it include all authorized English- and French-language pay and specialty services or a prescribed block of services that should, as a strict minimum, be offered in both languages in bilingual markets? Why?

(7) If the block of services option is chosen, what criteria should the Commission apply to decide on the content of such a block of services? Should the particular services included in a block change in terms of the size of the English- and French-language communities in a given region?

(8) Should the Commission consider the possibility of having different requirements depending on the language proportion in the market? If so, how could such requirements be established?

19. A review of the access rules in bilingual markets should take into account the impact of any changes made to these rules. Such changes could affect both subscribers and the operations of programming and distribution undertakings. Adding services in either language could require striking a balance between the benefits of a wider choice of services and the resulting financial implications. For example, some programming services, added to the basic service, could benefit from increased viewership. However, it must be recognized that at the same time, other services could be shifted to a lower-penetration tier.

(9) What factors would allow the Commission to evaluate the impact on subscribers and on programming services?

(10) Would those modifications have an impact on the programming services? Should the Commission establish guidelines concerning how distribution undertakings should implement any change that can affect programming services? If so,what could they be?

20. The application and repercussions of any new distribution requirement for English-language and French-language services in bilingual markets could have a significant impact on distribution undertakings. That impact, however, should be studied in the context of the expected evolution of the distribution sector.

21. DTH and MDS distribution undertakings are already operated in digital mode. The major cable systems should also have some digital capacity shortly. The advantages of this technology in terms of flexibility and increased transmission capacity are already apparent. Accordingly, some undertakings are now able to offer programming packages in English or in French, at the subscriber's choice. To retain their subcribers in markets which are becoming more and more competitive, some distribution undertakings which do not have the resources to adopt digital technology could enlarge their analog mode transmission capacity in order to offer a more attractive range of services. In small markets, distribution may continue only in analog mode, despite immediate needs to broaden the range of services offered.

(11) What factors specific to the various types of broadcasting distribution undertakings should the Commission take into account in determining the implementation date and the scope for any new programming service distribution requirements, if necessary, in bilingual markets?

(12) What indicators should the Commission use in determining a) when a broadcasting distribution undertaking's capacity, whether analog or digital, is sufficiently developed to apply a policy on bilingual markets? and b) when the application of such a policy is no longer required?

Call for comments

22. The Commission invites written comments that address the issues and questions set out in this notice. The Commission will accept comments that it receives on or before Wednesday, 4 August 1999.

23. The Commission will not formally acknowledge written comments. It will, however, fully consider all comments and they will form part of the public record of the proceeding, provided that the procedures for filing set out below have been followed.

Procedures for filing comments

24. Interested parties should send their comments to the Secretary General, CRTC, Ottawa, K1A ON2.

· Parties must file all submissions in "hard copy format" (i.e. on paper).

· Comments longer than five pages should include a summary.

25. The Commission also encourages parties to file electronic versions of their comments by e-mail or on diskette. The Commission's e-mail address for electronically filed documents is procedure@crtc.gc.ca

· Electronic submissions should be in the HTML format. As an alternative, those making submissions may use "Microsoft Word" for text and "Microsoft Excel" for spreadsheets.

· Please number each paragraph of the comment. In addition, please enter the line ***End of Document*** following the last paragraph. This will help the Commission verify that the document has not been damaged during transmission.

26. The Commission will make comments filed in electronic form available on its web site at www.crtc.gc.ca in the official language and format in which they are submitted. This will make it easier for members of the public to consult the documents.

Examination of public comments and related documents at the following Commission offices during normal business hours

Central Building
Les Terrasses de la Chaudière
1 Promenade du Portage, Room G-5
Hull, Quebec K1A ON2
Tel: (819) 997-2429 - TDD: 994-0423
Telecopier: (819) 994-0218

Bank of Commerce Building
1809 Barrington Street
Suite 1007
Halifax, Nova Scotia B3J 3K8
Tel: (902) 426-7997 - TDD: 426-6997
Telecopier: (902) 426-2721

Place Montréal Trust
1800 McGill College Avenue
Suite 1920
Montréal, Quebec H3A 3J6
Tel: (514) 283-6607 - TDD: 283-8316
Telecopier: (514) 283-3689

Kensington Building
275 Portage Avenue
Suite 1810
Winnipeg, Manitoba R3B 2B3
Tel: (204) 983-6306 - TDD: 983-8274
Telecopier: (204) 983-6317

530-580 Hornby Street
Vancouver, British Columbia V6C 3B6
Tel: (604) 666-2111 - TDD: 666-0778
Telecopier: (604) 666-8322

CRTC Documentation Centre
55 St. Clair Avenue East
Suite 624
Toronto, Ontario
Telephone: (416) 952-9096
Telecopier: (416) 954-6343

CRTC Documentation Centre
Cornwall Professional Building
2125, 11th Avenue
Room 103
Regina, Saskatchewan
S4P 3X3
Telephone: (306) 780-3422
Telecopier: (306) 780-3319

This notice is available in alternative format upon request, and may also be viewed at the following Internet site: http://www.crtc.gc.ca

Secretary General