ARCHIVED - Broadcasting Decision CRTC 2003-5

Broadcasting Decision CRTC 2003-5

Ottawa, 7 January 2003

David Reid, on behalf of a corporation to be incorporated
Whistler, British Columbia

Application 2002-0145-0
Public Hearing at Toronto, Ontario
17 September 2002

New cable broadcasting distribution undertaking

The Commission approves an application to operate a new Class 2 cable broadcasting distribution undertaking to serve Whistler, British Columbia.

The application

1.

The Commission received an application by David Reid, on behalf of a corporation to be incorporated (OBCI), for a broadcasting licence to operate a new Class 2 cable broadcasting distribution undertaking (BDU) to serve Whistler, British Columbia.

Interventions

2.

Four parties filed opposing interventions to this application. In addition, while the Mayor of the Resort Municipality of Whistler did not oppose the application, he did express concerns about elements of the proposed service.

Impact on the incumbent cable BDU

3.

Whistler Cable Television Ltd. (Whistler Cable), the incumbent BDU in Whistler, the Canadian Cable Television Association (CCTA), and the Mayor of the Resort Municipality of Whistler shared a primary concern that the proposed service would have a negative competitive impact on the incumbent BDU. More specifically, the CCTA argued that there is evidence that in very small markets, like Whistler, competition from multiple providers may not be sustainable. Further, Whistler Cable and the CCTA pointed out that the Whistler market is already a competitive market with satellite services available, and submitted that cable companies do not have the flexibility to compete with those services as it is.

4.

Whistler Cable also raised a concern that the applicant's intention to over-wire the community for its system would necessarily lead to outages and disruptions to Whistler Cable's service, thereby impacting the public perception of the incumbent's service.

5.

In reply, the applicant pointed out that the Commission has encouraged competition amongst broadcasting distributors. The applicant also stated that it would be competing as a cable company on the same basis as the incumbent, relative to satellite competition. Further, the applicant submitted that its growth may come at the expense of satellite master antenna television operations, rather than Whistler Cable.

6.

The applicant submitted that, with respect to the size of the market, given the tourist industry in Whistler, the market is not as small as it appears when considering the roughly 48,000 beds in hospitality units, over and above the roughly 7,500 households.

7.

The applicant maintained that it would build its own network, and in so doing would not affect the separate network or the customer service of Whistler Cable.

Local nature of the service

8.

A number of the interventions, and most notably the Whistler Chamber of Commerce and Whistler Resort TV, questioned the benefit of the application to local residents and the local orientation of the proposed service.

9.

In response, the applicant stated that it intends to become an integral part of the community - hiring locally and participating in community activities, as well as providing a community channel with additional local programming for the community. The applicant also stated that it would benefit the local consumer by providing more channels at a lower cost for basic service than the incumbent. Further, the applicant indicated that it would provide better signal quality, by using mostly a fibre optic network, capable of video on demand, Internet, and other services.

The Commission's analysis and determination

10.

Having considered the interventions and the applicant's replies, the Commission approves the application. Such approval is consistent with the approach taken by the Commission in similar circumstances in the past, based on its view that consumers should have increased choice among distributors of broadcasting and other services as expressed in its 19 May 1995 report entitled Competition and Culture on Canada's Information Highway: Managing the Realities of Transition.

11.

The Commission set out its regulatory framework for broadcasting distribution in New regulatory framework for broadcasting distribution undertakings, Public Notice CRTC 1997-25, 11 March 1997 (Public Notice 1997-25).

12.

This approval is also consistent with the regulatory framework contained in Public Notice 1997-25 that, overall, service to the public should have a higher priority than the economic viability of any incumbents against whom the new entrant would compete.

Issuance of the licence

13.

The operation of this undertaking will be regulated pursuant to the Broadcasting Distribution Regulations.The licence will expire 31 August 2009 and will be subject to the conditions set out in the appendix to this decision as well as in the licence to be issued.

14.

The Commission will only issue the licence once it has received documentation confirming that:

• an eligible Canadian corporation has been incorporated in accordance with the application in all material respects.

• the licensee has informed the Commission in writing that it is prepared to commence operations. The undertaking must be operational at the earliest possible date and in any event no later than 24 months from the date of this decision, unless a request for an extension of time is approved by the Commission before 7 January 2005. In order to ensure that such a request is processed in a timely manner, it should be submitted at least 60 days before this date.

The signals that the licensee is authorized to distribute may be received by direct reception, or from any Canadian BDU, licensed or exempted, which is authorized to provide signals to other distributors.

Employment equity

16.

In accordance with Implementation of an employment equity policy, Public Notice CRTC 1992-59, 1 September 1992, 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.

Secretary General

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: www.crtc.gc.ca

Appendix to Broadcasting Decision CRTC 2003-5