ARCHIVED - Broadcasting Commission Letter Addressed to Susan Wheeler and Ann Mainville-Neeson (Rogers Media Inc. and TELUS Communications Inc.)

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Ottawa, 5 April 2017

Ms. Susan Wheeler
Vice-President, Regulatory, Media
Rogers Media Inc.

Ms. Ann Mainville-Neeson
Vice-President, Broadcasting Policy and Regulatory Affairs
TELUS Communications Inc.

Re: TELUS request for enforcement of section 10.3 of the Specialty Services Regulations with respect to the 4K content of Rogers Media (Sportsnet)

On 27 March 2017, TELUS filed a request with the Commission seeking an expedited Commission determination to enforce section 10.3 of the Specialty Services Regulations, 1990 (the Regulations) against Rogers Media.

Section 10.3 of the Regulations reads as follows:

Except as otherwise provided under a condition of its licence, a licensee that is ready to launch a new programming service shall make that programming service available for distribution by all licensed broadcasting distribution undertakings or operators of exempt distribution undertakings, despite the absence of a commercial agreement.

A “new programming service” is defined in the Regulations, as follows:

new programming service means a programming service that has not been previously distributed in Canada and includes, but is not limited to, a high definition version or a new multiplex of an existing programming service.

TELUS argued that 4K content is clearly a “new programming service” as that term is defined in the Regulations and that Rogers Sportsnet should, as required by the Regulations, provide that content, even in the absence of a commercial agreement.  TELUS further noted that it bears all the risk of the application of the rule, since it will launch the service without knowledge of the financial commitment it is making and since any fees will apply retroactively.  In TELUS’ view, there is no risk to Rogers – Sportsnet will merely benefit from having its 4K service made available to more potential subscribers.

Finally, TELUS noted that if the Commission does not act quickly, TELUS subscribers who have invested in 4K television sets will not be able to benefit from viewing the upcoming Blue Jays’ home opener in 4K on 11 April 2017.

In its response dated 29 March 2017, Rogers argued that TELUS’ request involves policy issues and matters for regulatory compliance that have an impact on other stakeholders and which should be subject to the procedures under Part 1 of the CRTC Rules of Practice and Procedure. Rogers also argued that 4K is not a new programming service.  It states that broadcasters and BDUs have been offering this 4K content under their existing licences, rather than some sort of new authorization.  Rogers also disputed TELUS’ claim of urgency.

TELUS replied on 29 March 2017 refuting Rogers’ assertion that the matter must be dealt with via a Part 1 process and Rogers’ claim that TELUS’s request was not timely.

Commission’s analysis and decision

The definition of a “new programming service” in the Regulations explicitly includes a high definition version of an existing service as a new programming service that is subject to the no head start rule.  The moniker “4K” refers to the quality or resolution of the image that is viewed on a display device such as a television.  Just as high definition television provides a substantially higher resolution than standard-definition television (at a minimum two times better resolution), 4K TV provides about two times the resolution of high definition. 

Therefore, just like a high definition version of an existing service, the Commission confirms that a 4K signal is indeed a “new programming service” as defined in the Regulations, and is thus clearly covered by section 10.3 of those regulations.

Because this is a merely a matter of clarifying the interpretation of existing regulations rather than creating new policy or regulations, no further process is required.

Accordingly, the Commission directs Rogers Media to provide its 4K content to TELUS immediately, despite the absence of a commercial agreement.  As contemplated in the Commission’s vertical integration framework, and as implemented in the dispute resolution provisions of both the Regulations and the Broadcasting Distribution Regulations, rates, terms or conditions for the distribution of this content can be established through dispute resolution before the Commission should the parties require such assistance.

Yours sincerely,

Danielle May-Cuconato
Secretary General

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