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ARCHIVED - Broadcasting Public Notice CRTC 2003-21

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Broadcasting Public Notice CRTC 2003-21

Ottawa, 25 April 2003

Call for comments on proposed changes to the winback rules for broadcasting distribution undertakings

The Commission calls for comment on proposals, including those of the Canadian Cable Television Association, regarding the current rules limiting the nature of the activities in which incumbent cable companies may engage for the purpose of regaining former customers.

Background

1. In a letter decision dated 1 April 1999, the Commission established rules (the winback rules) that prohibit the targeted marketing by incumbent cable companies of customers who have cancelled basic cable service. These rules require incumbent cable companies to refrain, for a period of 90 days, from:
  • directly contacting customers who, through an agent, have notified their cable company of their intention to cancel basic cable service; and
  • offering discounts or other inducements not generally offered to the public, in instances when customers personally initiate contact with the cable company for the purpose of cancelling basic cable service.
2. In its decision, the Commission examined whether it would be appropriate, given the state of competitive entry in the broadcasting distribution market, to impose winback rules on either incumbents, new entrants or both. The Commission concluded that only incumbent cable companies should be subject to winback rules as the "ability of new entrants to engage effectively in (winback) activity is counterbalanced by the incumbent distributors' dominant position and their significant market share".

Proposal by the Canadian Cable Television Association

3. On 28 October 2002, the Canadian Cable Television Association (CCTA) filed an application, on behalf of its member companies, requesting that the Commission eliminate the winback rules restricting communication between customers and incumbent cable companies.
4. The CCTA noted that the rationale for the imposition of the winback rules had been based on the dominant position of incumbent cable broadcasting distribution undertakings (BDUs) relative to that of new entrants. It argued that the state of competitive entry in the broadcasting distribution market has changed substantially since 1999. To support its arguments for elimination of the winback rules, the CCTA cited the following developments that have taken place in the broadcasting distribution market over the intervening period:
  • The market share of competing BDUs has risen significantly and cable companies have seen a corresponding decrease, in absolute terms, in the total number of customers they serve and in their market share.
  • As a result of their increased market share, competitors now possess a critical mass of customer information, comparable to that possessed by the larger cable BDUs.
  • The Commission has made a number of adjustments to the regulatory framework based on its recognition of the existence of an effective competitive BDU market and the need for competitive equity. The CCTA cited, among others, Commission decisions that authorize cable companies to purchase controlling interests in analog pay and specialty services1, permit direct-to-home satellite (DTH) BDUs to use terrestrial facilities to interconnect buildings on different properties2, and allow DTH BDUs to engage in bulk billing3.
  • Since 1999, the four largest incumbent cable companies have established customer service groups (CSGs) for the purpose of isolating competitively sensitive customer/competitor information from the sales and marketing group. The CCTA argued that the CSGs will provide an adequate safeguard and address concerns about the use of competitively sensitive information obtained from competing licensees.

Call for comments

5. The Commission recognizes that significant developments in the BDU market since the issuance of the winback rules in 1999 have resulted in greater competition among BDUs. DTH BDUs, in particular, have experienced a significant increase in the number of their subscribers and in their share of the overall BDU market. Other types of BDU competitors, however, may not have made comparable inroads into the market.
6. The Commission seeks public comment on the winback rules, the CCTA's proposal and other possible revisions to the rules, and on the following specific questions:
a) In light of the growth of competition in the broadcasting distribution market, should the Commission maintain its current rules prohibiting the targeted marketing by incumbent cable companies of customers who have cancelled basic cable service, or not ?
b) Should the winback rules apply only to licensees that meet certain criteria? For example, should the applicability of the rules take into account a BDU's overall market share, or its share within a specific market? What other criteria might be used to determine the applicability of winback rules?
c) Would it be appropriate for the Commission to establish different winback rules with respect to customers in multiple-unit dwellings as opposed to single-unit dwellings?
d) Should the content of the winback rules be altered and if so, how?
e) Would it be appropriate for the Commission to decrease the 90-day time period during which an incumbent cable company must refrain from attempting to winback a customer?
7. The Commission will hold a two-stage written comment process for this proceeding. In the first stage, the Commission will accept comments that it receives on or before 9 June 2003. The Commission invites interested parties to file replies to any of the comments submitted during the first stage by 9 July 2003.
8. The Commission will not formally acknowledge 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

9. Interested parties can file their comments either electronically (i.e. by email) or on paper. Submissions longer than five pages should include a summary.
10. Parties wishing to file their comments electronically can do so by sending them to procedure@crtc.gc.ca.
11. Parties wishing to file their comments on paper should send them to the Secretary General, CRTC, Ottawa, K1A 0N2.
12. Please number each paragraph of your submission. 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.
13. The Commission will make comments filed in electronic form available on its web site at www.crtc.gc.ca  but only in the official language and format in which they are submitted. Such comments may be accessed in the Public Proceedings section of the CRTC web site. Copies of all comments, whether filed on paper or in electronic form, will also be placed on the public examination file.
14. The Commission encourages interested parties to monitor the public examination file (and/or the Commission's web site) for additional information that they may find useful when preparing their comments.

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 0N2
Tel: (819) 997-2429 - TDD: 994-0423
Fax: (819) 994-0218
Metropolitan Place,
99 Wyse Road, Suite 1410,
Dartmouth, Nova Scotia, B3A 4S5.
Tel: (902 426-7997 - TDD: 426-6997
Fax: (902) 426-2721
405 de Maisonneuve Blvd. East
2nd Floor, Suite B2300
Montréal, Quebec H2L 4J5
Tel: (514) 283-6607 - TDD: 283-8316
Fax: (514) 283-3689
55 St. Clair Avenue East
Suite 624
Toronto, Ontario M4T 1M2
Tel: (416) 952-9096
Fax: (416) 954-6343
Kensington Building
275 Portage Avenue
Suite 1810
Winnipeg, Manitoba R3B 2B3
Tel: (204) 983-6306 - TDD: 983-8274
Fax: (204) 983-6317
Cornwall Professional Building
2125 - 11th Avenue
Room 103
Regina, Saskatchewan S4P 3X3
Tel: (306) 780-3422
Fax: (306) 780-3319
10405 Jasper Avenue
Suite 520
Edmonton, Alberta T5J 3N4
Tel: (780) 495-3224
Fax: (780) 495-3214
530-580 Hornby Street
Vancouver, British Columbia V6C 3B6
Tel: (604) 666-2111 - TDD: 666-0778
Fax: (604) 666-8322
Secretary General
This document is available in alternative format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca
1Ownership of analog discretionary services by cable undertakings, Public Notice CRTC 2001-66, 7 June 2001 and Ownership of analog discretionary services by cable undertakings - amendment to the Commission's policy, Public Notice CRTC 2001-66-1, 24 August 2001

2Decision CRTC 2000-395, 26 September 2000

3Bulk billing by direct-to-home satellite distribution undertakings, Broadcasting Public Notice CRTC 2002-7, 12 February 2002

Date Modified: 2003-04-25

Date modified: