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Broadcasting Decision CRTC 2003-337
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Ottawa, 24 July 2003
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Kincardine Cable T.V. Ltd.
Kincardine, Ripley, Tiverton, Bruce Beach, Inverhuron
and Point Clark, Ontario
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Application 2002-0914-9
Broadcasting Public Notice CRTC 2003-6
10 February 2003
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Reorganization of service areas
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The application
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1.
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The Commission received an application by Kincardine Cable T.V. Ltd. (Kincardine Cable) to amend the broadcasting licence for its cable broadcasting distribution undertaking (BDU) serving Kincardine, Ripley, Tiverton, Bruce Beach, Inverhuron and Point Clark. The applicant proposed to delete the communities of Ripley, Tiverton, Bruce Beach, Inverhuron and Point Clark from its authorized service area.
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2.
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Kincardine Cable stated that, under its present licence, it serves approximately 3,450 subscribers. Most of its subscribers reside in the Town of Kincardine, while the largest of the rural communities it wishes to delete from its authorized service area contains 370 subscribers and the smallest contains 70 subscribers. The applicant stated that the five small rural communities outside the proposed service boundary are served by a separate head end and are not fully interconnected with the system serving the Town of Kincardine.
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3.
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In support of its application, Kincardine Cable argued that the costs of serving the five small rural communities are very high. The applicant further submitted that, if the proposed licence amendment were approved, these communities would meet the criteria set out in Exemption order respecting cable systems having fewer than 2,000 subscribers, Public Notice CRTC 2001-121, 7 December 2001 (Public Notice 2001-121) and any undertaking serving them would be exempt from licensing requirements and associated regulations. According to the applicant, the savings it would realize from exempt status, including the costs associated with regulatory reporting requirements, would enable it to better compete with larger satellite companies and improve the quality of its service. The applicant confirmed that it would continue to provide the subscribers in these communities with the same programming services that they currently receive.
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4.
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The applicant stated that it would continue to operate a Class 2 cable BDU to serve the remaining area, which would enclose the Town of Kincardine. It estimated that this cable BDU would serve approximately 2,500 subscribers.
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The interventions
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5.
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The Commission received interventions opposing this application from the Copyright Collective of Canada (CCC), the Canadian Retransmission Collective (CRC), and the Canadian Broadcasters Rights Agency Inc. (CBRA). Marianne and Ernie Greer of Inverhuron also opposed the proposed licence amendment.
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6.
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The CCC, the CRC and the CBRA are collective societies that administer copyright royalities rights and tarriffs on behalf of the owners of programming that is transmitted or retransmitted by Canadian BDUs. The interveners noted that Kincardine Cable is a retransmitter of distant signals for the purpose of the retransmission regime set out in the Copyright Act. While acknowledging that issues related to copyright are not within the Commission's jurisdiction, the interveners expressed concern that splitting Kincardine Cable's current cable system would result in a substantial reduction in the applicant's copyright royalties.
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7.
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In response to the collective societies, Kincardine Cable pointed out that the interveners themselves acknowledged that concerns regarding copyright are not within the Commission's jurisdiction. The applicant argued that its application should be evaluated on how its meets the Commission's criteria.
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8.
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In response to Mr. and Mrs. Greer, the applicant affirmed that it would not reduce the quality of the service it provides to its subscribers.
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The Commission's analysis and conclusion
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9.
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The Commission notes that the Class 2 cable system currently operated by Kincardine Cable uses more than one head end and that the facilities the applicant uses to serve the small communities it proposes to delete from its authorized service area are not fully interconnected with those that serve the Town of Kincardine. The Commission finds that authorizing Kincardine Cable to split its cable system into two parts is consistent with the manner in which the applicant currently operates.
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10.
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With regard to the concerns raised in the interventions by the collective societies, the Commission notes that the level of compensation paid for the retransmission of distant signals falls within the regulatory jurisidiction of the Copyright Board of Canada. The Commission is also satisfied with the applicant's response to the intervention by Mr. and Mrs. Greer.
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11.
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In view of the foregoing, the Commission approves the application by Kincardine Cable T.V. Ltd. to amend the broadcasting licence for its cable BDU serving Kincardine, Ripley, Tiverton, Bruce Beach, Inverhuron and Point Clark, by deleting the communities of Ripley, Tiverton, Bruce Beach, Inverhuron and Point Clark from its authorized service area.
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12.
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Kincardine Cable will continue to operate a cable BDU to serve Ripley, Tiverton, Bruce Beach, Inverhuron and Point Clark. The Commission finds that this cable BDU would qualify for exempt status in accordance with the criteria stipulated in the exemption order set out in Public Notice 2001-121. Specifically, the exemption order states that the number of subscribers to the cable BDU must be fewer than 2,000, the undertaking must operate its own head end, and not serve all or part of the same licensed area as a cable BDU that is a Class 1 or Class 2 licensee, as defined in the Broadcasting Distribution Regulations.
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13.
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Since Kincardine Cable filed the present application, the Commission has issued Exemption of cable broadcasting distribution undertakings that serve between 2,000 and 6,000 subscribers, Broadcasting Public Notice CRTC 2003-23, 30 April 2003. In that public notice, the Commission announced that it will exempt, under certain conditions, Class 2 cable BDUs that serve between 2,000 and 6,000 subscribers and that it will solicit comments on a proposed exemption order at a later date.
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Secretary General
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This decision is to be appended to the licence. It is available in alternative format upon request, and may also be examined at the following Internet site: http://www.crtc.gc.ca
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Date Modified: 2003-07-24