Broadcasting Commission Letter addressed to Peggy Tabet (Quebecor Media Inc.) and Kevin Goldstein (BCE Inc.)
Ottawa, 5 August 2020
Public and Regulatory Affairs
Quebecor Media Inc.
Regulatory Affairs, Content and Distribution
Sent by email
Re: Follow-up to Broadcasting Decision CRTC 2019-427, Complaint by Quebecor, on behalf of TVA, against Bell, represented by BCE, alleging undue preference regarding the packaging of TVA Sports
Dear Madam, Sir,
In Broadcasting Decision CRTC 2019-427 (Decision 2019-427), the Commission found that Bell Canada and Bell ExpressVu Inc. (the general partner) as well as Bell Canada (the limited partner), carrying on business as Bell ExpressVu Limited Partnership (Bell) had subjected TVA Sports to an undue disadvantage and had conferred an undue preference upon RDS. The Commission directed Bell to “remedy the situation and include TVA Sports in the same program offering as RDS, and report back to the Commission on a new packaging structure that would neither unduly disadvantage TVA Sports nor unduly prefer RDS.”
Bell reported on its new packaging plan on 5 February 2020. It indicated that it would cease offering Quebec customers the option of subscribing to Bon, Mieux or Meilleur. For existing subscribers, Bell indicated that it would be grandfathering all of its preassembled tiers. Customers who already subscribe to Bon would be offered the option of taking either RDS or TVA Sports. Further, Bell indicated that should subscribers choose to remain with RDS, they would now also receive RDS2. New customers would only be able to subscribe to Bell’s basic service, branded Départ, and then add channels on an à la carte or custom pack basis.
On 6 February 2020, Quebecor Media Inc., on behalf of TVA Group Inc. (Quebecor) wrote to the Commission arguing that Bell’s plan was unacceptable and would perpetuate TVA Sports’ undue disadvantage. It asked the Commission to (a) recognize that Bell is not respecting the Commission’s Decision, (b) categorically reject Bell’s proposed packaging which in no way conforms to the Decision, and (c) order Bell to include TVA Sports in Bon, Bell’s most popular preassembled package.
Quebecor argued that far from ending the undue disadvantage/preference, this new packaging structure would further advantage RDS by adding RDS2 as a bonus for current Bon subscribers. To access TVA Sports, subscribers would have to make an active choice to drop RDS in favour of TVA Sports. Quebecor stated that the chance of subscribers taking action to drop RDS, which has been part of Bon for a considerable time, to take TVA Sports, is almost zero, thereby continuing the undue preference/disadvantage. With the new packaging plan, all Bon subscribers would continue to have access automatically to RDS and not TVA Sports. Further, Bell would double the advantage to RDS by adding RDS2.
In a reply dated 12 February, Bell argued that its proposed packaging structure would fully comply with the Commission’s Decision since the services would be included in the same program offering and Bon subscribers would have the choice of taking either TVA Sports or RDS. Bell stated that its packaging plan would allow subscribers to make an informed choice as to which service they prefer to take as part of their Bon package, and whether they wish to take the second service on an à la carte basis. Bell also argued that it is pure speculation to state that this offering would continue the undue preference/disadvantage, as there is no evidence as of yet.
With respect to RDS2, Bell noted that it is comparable to TVA Sports’ second feed, and that offering RDS2 with RDS is treating both RDS and TVA Sports in the same manner, providing Bon subscribers a choice of either RDS1&2 or TVA Sports 1&2. Bell stated that leaving RDS2 in Mieux would disadvantage RDS2 and confer a preference on TVA Sports 2.
Finally, Bell argued that ultimately what Quebecor wants is for TVA Sports to be forced on subscribers with no regard to whether they actually want the service or how much it may cost them – i.e. by requiring Bell to package TVA Sports with RDS in Bon.
Quebecor responded to Bell’s reply on 17 February 2020 and both parties filed additional documents in response to Commission staff questions on 6 March 2020.
Having reviewed the submissions of the parties, the Commission finds that Bell’s proposal remedies the undue disadvantage on a going forward basis for new subscribers as both services are offered on the same basis as à la carte or custom pack options. However, the Commission is concerned that the historical preference will largely remain the same with the grandfathering of the Bon package, for two reasons:
- First – there is a risk that inertia will cause the bulk of Bell’s Bon subscribers to stay with RDS. In particular, non-sports fans, or sports fans of ‘casual interest’ are unlikely to make a positive choice to switch. Since there is no real incentive for them to modify their existing package, it is also likely that a large proportion of Bon subscribers will not make the effort to switch, leaving RDS in a more advantageous position, and thereby perpetuating the disadvantage. In addition, it is not clear how Bell’s communications to existing Bon subscribers regarding its new program offerings would help remedy this situation.
- Second – the addition of RDS2 would appear to grant a bonus for keeping RDS. While Bell has argued that RDS and RDS2 are comparable to TVA Sports 1&2 and, therefore, that the new packaging construct affords similar treatment to both sets of channels, the Commission notes that the previous packaging arrangengment does not support this conclusion. While TVA Sports 1&2&3 are multiplexes and have always been offered together, RDS and RDS2 are separate services (licensed separately), and have been marketed separately by Bell since RDS2 was launched in 2012 (packaged with TVA Sports in Mieux). Under the previous packaging arrangement, Bon subscribers could add RDS2 to their channel lineup, just as they could add TVA Sports, but only at the additional standalone cost of $14, or by subscribing to Mieux. The Commission considers that adding RDS2 to Bon for those subscribers that choose to keep RDS effectively sweetens the offer of RDS, perhaps even rewards subscribers for keeping RDS – and will perpetuate the undue preference/disadvantage identified by the Commission in Decision 2019-427.
In light of the above, and noting the Commission’s determination in Decision 2019-427 that the exclusion of TVA Sports from Bon, in contrast to RDS, has had, and continues to have, a material adverse impact on TVA’s operations, the Commission finds that the packaging structure set forth by Bell in its 5 February letter does not fully remedy the undue preference/disadvantage. While Bell’s approach to new customers satisfies the Commission’s concerns going forward, the Commission is not satisfied that it will remedy the situation with respect to grandfathered Bon subscribers.
Therefore, the Commission directs Bell (at its choice) to either add TVA Sports to Bon, along with RDS, or remove RDS from Bon, and offer both services in the same program offering.
With respect to RDS2, the Commission notes that it is up to Bell to decide how to offer the service, including whether to offer it with RDS or not. However, the Commission cautions that any such offering should not be made in a way that would perpetuate the undue disadvantage of TVA Sports.
The Commission reminds the parties that these are matters that would more appropriately be dealt with in the context of the parties’ ongoing negotiations.
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