ARCHIVED - Transcript, Hearing September 7, 2016

Volume: 1
Location: Gatineau, Quebec
Date: September 7, 2016
© Copyright Reserved

Attendees and Location

Held at:

Outaouais Room
Conference Centre
140 Promenade du Portage
Gatineau, Québec

Attendees:

• Chairman: Jean-Pierre Blais
  
• Members: Steve Simpson, Christopher MacDonald
  
• Legal Advisor: Jean-Sébastien Gagnon
  
• Senior Policy Analysts: Claude Brault, Pierre-Louis Prégent
  
• Secretary: Cindy Ventura
  
• Hearing Coordinator: Sylvie Julien
  
• Manager: Jean-Pierre Lefebvre
  

Transcript

Gatineau, Québec

--- Upon commencing on Wednesday, September 7, 2016 at 9:01 a.m.

1 LE PRÉSIDENT: À l’ordre, s’il vous plaît.

2 Alors bonjour, mesdames et messieurs, et bienvenue à cette audience publique.

3 Avant de commencer, je tiens à reconnaître que nous sommes réunis aujourd'hui sur le territoire traditionnel des Premières nations. Je remercie le peuple Algonquin et rend hommage à leurs ainés.

4 Cette audience a lieu dans le cadre du processus pour examiner les demandes de renouvellement de licences des entreprises de distribution de radiodiffusion.

5 This hearing will be limited to the following two areas. First, the practices certain providers have adopted in offering the basic -- the small basic package and flexible packaging options. And secondly, the implementation of the obligation to dispute, effective December 1^st, 2016 discretionary services on a standalone basis and in packages of up to 10 services.

6 Le CRTC a tenu une grande conversation avec les Canadiens au sujet de l’avenir de la télévision au Canada. Tous étaient invités d’y participer. Le Conseil continue de le mettre en vigueur ce régime. En mars 2015, nous avons publié une série de décisions afin de nous assurer que le système de télévision au Canada était prêt à faire face à l’avenir aux nouvelles plateformes et aux nouvelles habitudes de consommation des Canadiens.

7 Un sujet revenait sans cesse lors de cette conversation, le choix. Les Canadiens ont de plus en plus de choix qui s’offrent à eux afin de consommer du contenu audiovisuel sur diverses plateformes.

8 Canadians told us loud and clear, however, that they do not have those same choices when it comes to traditional television services. Some consumers felt that they were locked into expensive packages, and had to subscribe to several channels in order to access the content they really wanted. CRTC took action to ensure that Canadians have more affordable choices when it comes to basic packages and bundles of channels.

9 Depuis mars 2016, les fournisseurs qui détiennent une licence doivent offrir un forfait de base abordable ne coûtant pas plus que 25 $ par mois. Certaines chaînes doivent obligatoirement se retrouver dans ce forfait, tel que les stations locales, les chaînes à distribution obligatoire, les chaînes éducatives et les chaînes communautaires; d’autres sont facultatives, comme les stations affiliées aux réseaux américains commerciaux, notamment ABC, CBS, FOX, NBC et PBS; les stations AM et FM locales, d’autres stations en direct canadiennes et les canaux éducatifs d’une autre province dans chaque langue officielle.

10 Since March 2016, these providers are also required to offer optional channels, either on an individual basis or in small packages of up to 10 channels. They will be required to offer both these two choices starting on December 1, 2016.

11 In February 2016, in a speech to the Canadian Club in Toronto, I stated that providers should not see this change as an opportunity to replace business practices aimed at maximizing profits at the expense of a captive consumer with new behaviour that run counter to the consumers’ interest. Rather, I challenged them to further improve the products they offer to Canadians, and put control of television back into the hands of viewers, namely their clients.

12 The affordable basic service option is clearly attractive to certain Canadians, maybe not all, but certain of them. As of June 30^th, 2016, 177,000 Canadians had signed up for the affordable basic service. Some providers offered Canadians new options to make it even more beneficial. We received a number of comments from satisfied Canadians. Here is one, and I quote:

13 “I like what the skinny package has done. I was able to eliminate channels I don’t watch, and with the money I saved I ordered channels I want. My monthly bill overall has not changed, but I have more channels I want and less channels I don't want. I look forward to individual channel pricing so I can eliminate more channels I don't watch.”

14 End of quote.

15 Et en voici un autre, et je cite:

16 « Je suis très satisfait du petit forfait de télévision de base offert par mon fournisseur de service. En changeant, mes coûts on été réduits de 18 $ par mois. En tant que retraité recevant un revenu fixe, c'est très important pour moi. En plus des chaînes de télévision canadienne, le forfait de base comprend également les quatre grand réseaux américains, NBC, CBS, ABC, FOX, ce qui est également très important pour moi. Pour mon visionnement personnel les chaînes contenues dans le forfait sont suffisantes et je n’ai pas l’intention d’en ajouter d’autres. »

17 Fin de la citation.

18 However, other Canadians are dissatisfied and shared their concerns and frustrations about the way some providers, not all, but some, are offering the affordable basic package and the new smaller channel packages. Here are a few representative examples of comments we received from disappointed Canadians. One Canadian told us, quote:

19 “My service provider has effectively held me hostage. If I choose to change to the skinny package, I'm forced to forfeit ‘background’ bundled savings, ones that I don't even see on my bill. This is ‘internal’ cost-savings logic, and an increase in the PVR rental that I already pay for. Even if I choose to go with the base skinny package, with no add-ons, the total cost will be higher than my current package and rental. Yes, I get more channels now, but I don’t want more channels. I just want 15. And I get punished for that.”

20 End of quote.

21 Un autre Canadien nous a dit que le forfait de base offert par un fournisseur en particulier respecte peut-être la loi à la lettre, mais il est clairement conçu pour être tout-à-fait indésirable et non-économique.

22 Voici un dernier exemple, je cite:

23 « Hier j’ai appelé pour me renseigner au sujet du petit forfait de 25 $, on m’a dit que si je choisi ce service ma facture téléphonique augmentera de 20 $ par mois, et ma facture d’internet augmentera de 30 $ par mois. »

24 Fin de la citation.

25 As you can see, ladies and gentleman, some Canadians have told us clearly that they are not satisfied with the way the new choices have been implemented.

26 Together, Bell, Rogers, Shaw and Vidéotron serve more than three-quarters of all Canadian subscribers. For this reason, we invited them to appear at this hearing to determine whether their actions are consistent with our objective of offering Canadians more choice.

27 Donc avant de commencer j’aimerais faire quelques présentations. Le Comité d’audition se compose des personnes suivantes: monsieur Steve Simpson, Conseiller régional de la Colombie-Britannique et du Yukon; monsieur Christopher MacDonald, Conseiller régional de l’Atlantique et du Nunavut; et moi-même Jean-Pierre Blais, Président du CRTC et je présiderai cette audience.

28 L’équipe du Conseil qui nous assiste se compose des personnes suivantes: Sylvie Julien, Coordonatrice de l’audience; Jean-Pierre Lefebvre, gestionnaire; Claude Brault, analyste principal des politiques; Pierre-Louis Prégent, analyste principal des politiques; Jean-Sébastien Gagnon, conseiller juridique; et Cindy Ventura, secrétaire de l’audience.

29 J’invite maintenant Madame Ventura à expliquer la procédure que nous suivrons.

30 Madame la secrétaire.

31 THE SECRETARY: Thank you, Mr. Chairman, and good morning.

32 I would like to go over a few housekeeping matters to ensure the proper conduct of the hearing.

33 When you are in the hearing room, we would ask that you please turn of your smartphones as they are an unwelcome distraction and they cause interference on the internal communication systems used by our translators.

34 We would appreciate your cooperation in this regard throughout the hearing.

35 Interpretation services will be available throughout the duration of the hearing. We would like to remind participants that during their oral presentations, they should provide for a reasonable delay for interpretation while respecting their allocated presentation time.

36 Le service d’interprétation simultanée est disponible durant cette audience. Nous désirons rappeler aux participants d’allouer un délai raisonnable pour la traduction lors de leurs présentations à vive voix tout en respectant le temps alloué pour leurs présentations.

37 There is a verbatim transcript of this hearing being taken by the court reporter sitting at the table to my right. Please note that the full transcript will be made available on the Commission’s website on the next business day.

38 Just a reminder that pursuant to section 41 of the Rules of Practice and Procedure, you must not submit new evidence at the hearing. If you wish to introduce new evidence as an exception to this rule, you must ask permission of the Panel of the hearing before doing so.

39 Veuillez noter que les documents seront disponibles sur Twitter sur le compte du conseil à @crtcaudiences au pluriel en utilisant le mot-clic #crtc.

40 Please note that the Commission will also be tweeting the documents during the hearing at @crtchearings using #crtc.

41 Please note that if parties undertake to file information with the Commission in response to questioning by the panel, these undertakings can be confirmed on the record through the transcript of the hearing.

42 If necessary, parties may speak with Commission legal counsel at a break following their presentation to confirm the undertakings.

43 Maintenant, Monsieur le président, nous allons débuter avec l’article 1 de la Phase 1 à l’ordre du jour. Nous entendrons la présentation de Vidéotron Ltée et 9227-2590 Québec Inc., associés dans une société en nom collectif faisant affaires sous le nom de Vidéotron S.E.N.C.

44 Veuillez s'il vous plaît vous présenter et présenter vos collègues. Après quoi, vous aurez 20 minutes pour votre présentation.

45 Merci.

PRESENTATION

46 M. SASSEVILLE: Monsieur le président, Messieurs les conseillers, bonjour.

47 Je m’appelle Serge Sasseville et je suis vice-président principal, Affaires corporatives et institutionnelles de Québecor Média.

48 Permettez-moi de vous présenter les collègues qui m’accompagnent aujourd’hui.

49 Immédiatement à ma gauche, il s’agit de Manon Brouillette, présidente et chef de la direction de Vidéotron, Marie Ginette Lepage, vice-présidente Marketing, télédistribution et exploitation des contenus de Vidéotron, et Caroline Paquet, directrice principale, gestion et exploitation des plateformes de contenu de Vidéotron.

50 À ma droite, Peggy Tabet, vice-présidente, Affaires réglementaires, Radiodiffusion de Québecor Média, et Valérie Héroux, directrice principale, Programmation télédistribution multiplateforme de Vidéotron.

51 Mme BROUILLETTE: Bonjour. Nous sommes heureux d’être présents devant vous aujourd’hui afin de rendre compte de nos pratiques à l’égard des exigences relatives à l’offre d’un petit service de base et d’options d’assemblage souples.

52 Rappelons que Vidéotron fut un précurseur en la matière puisque nos clients profitent, depuis plus de 15 ans, de la prérogative du choix avec les forfaits « Sur Mesure ».

53 L’offre flexible de Vidéotron, tel que vous l’avez déjà énoncée, a aussi inspiré le Conseil lors de l’élaboration de sa nouvelle politique « Parlons Télé » et a même poussé nos concurrents à suivre la même voie au Québec.

54 Le nombre infime d’interventions reçues, seulement trois, dans le cadre de cette instance et visant directement Vidéotron, témoigne de la satisfaction de nos abonnés face à nos offres. D’ailleurs, en 2016, Vidéotron a été nommée l’entreprise de télécommunications la plus admirée des Québécois pour une 11^ème année consécutive.

55 Nous avons effectué tout cela dans un environnement de plus en plus fragilisé et de plus en plus concurrentiel. La recrudescence des services de vidéo en ligne engendre un transfert d’abonnés du système de télédistribution traditionnel vers un système complètement ouvert qu’est l’internet.

56 En 2015, au Canada, le nombre d’abonnés à la télédistribution a chuté de près de 160,000. Pendant ce temps, les services de vidéo en ligne continuent leur ascension fulgurante. Rappelons que Netflix a atteint 4 millions d’abonnés canadiens à la fin de l’année 2015.

57 Afin de suivre cette tendance et d’occuper rapidement ce créneau, Vidéotron a encore une fois innové et a été le premier télédistributeur canadien à offrir, dès l’hiver 2013, Club illico, un service de vidéo sur demande par abonnement avec le plus grand répertoire de titres francophones au Canada et plusieurs séries originales exclusives, comme par exemple Blue Moon, Karl & Max, et une toute première production en ultra-haute définition 4K, Victor Lessard, qui sera présentée à compter de l’hiver 2017. Club illico compte à ce jour plus de 260,000 abonnés.

58 Mme LEPAGE: En ce qui concerne la nouvelle politique « Parlons Télé », la mise en œuvre de celle-ci n’a pas eu un impact significatif sur l’offre de Vidéotron qui avait déjà une longueur d’avance afin de répondre adéquatement aux exigences du Conseil.

59 En ce qui a trait à l’implantation d’un service de base réduit, Vidéotron offre, depuis le 24 février 2016, un service de base au coût de 25$, comme vous pouvez le voir présentement à l’écran...ou pas. Voilà.

60 Vidéotron a choisi de n'offrir qu’un seul service de base sans aucun premier volet facultatif étant donné que son service de base offert avant le 24 février rencontrait en général les conditions énoncées dans le Règlement sur la distribution.

61 Pour Vidéotron, l’offre d’un premier volet facultatif n’aurait pas représenté une plus-value pour le client qui a le choix maintenant de s’abonner au nouveau service de base réduit auquel il peut ajouter un forfait "Sur Mesure" de cinq services afin de reproduire un forfait quasi-semblable à l’ancien service de base de Vidéotron.

62 Il est important de noter que tous nos abonnés ont accès gratuitement au portail de la vidéo sur demande et à la télé à la carte lorsqu’ils s’abonnent au service de base.

63 Ainsi, afin de pouvoir accéder à ce service, aucune condition additionnelle, modalité ou restriction s’applique. Notre offre est donc claire, simple et transparente.

64 Nous sommes d’avis que cela rejoint parfaitement la volonté du Conseil d’offrir un service de base abordable assorti d’une plus grande flexibilité au niveau du choix exercé par les abonnés.

65 Concernant les petits forfaits, tel que déjà mentionné, Vidéotron offrait depuis plusieurs années des petits forfaits avec des services choisis « Sur Mesure » par l’abonné. Ainsi, Vidéotron a tout simplement maintenu cette offre qui est bien appréciée par nos clients.

66 De plus, comme vous pouvez remarquer, tous les services facultatifs sont disponibles soit à travers nos forfaits « Sur Mesure » de 5, 10, 20 et 30 services ou à la carte, et ce en conformité aux exigences de la politique et du Règlement sur la distribution en vigueur depuis le 1^er mars 2016.

67 Avec tout forfait « Sur Mesure », l’abonné reçoit en valeur ajoutée les chaînes de Stingray et les chaînes radiophoniques FM et AM.

68 De plus, Vidéotron offre des rabais sur la location d’équipement selon le forfait choisi, ce qui est grandement à l’avantage des abonnés. Cela est aussi une façon d’encourager l’abonnement aux services facultatifs afin de contrer l’érosion de leur taux de pénétration.

69 Étant donné que l’offre à la carte des services facultatifs ne deviendra obligatoire qu’à compter du 1^er décembre 2016, Vidéotron ne propose pas actuellement une offre à la carte de tous les services.

70 Cependant, à compter du 1^er décembre 2016, tous les services facultatifs seront offerts à la carte, et ce en conformité avec la réglementation.

71 En ce qui a trait aux différents codes à respecter, Vidéotron adhère déjà au Code sur la vente en gros et respectera, dès le 1er septembre 2017, le Code des fournisseurs de services de télévision, tout en

72 s’inscrivant auprès du Commissaire aux plaintes relatives aux services de télécommunications à titre de fournisseur participant.

73 Mme BROUILLETTE: Il est vrai que chez Vidéotron, nous sommes toujours à l’affut des nouvelles tendances et à l’écoute des besoins de nos clients qui sont au centre de nos décisions. D’ailleurs, bien

74 avant que la règlementation ne nous y oblige, Vidéotron a mis en marché des forfaits flexibles et au choix des abonnés. Mais la flexibilité et les offres taillées sur mesure ont un prix et des impacts. Voici quelques exemples.

75 Les changements de chaînes représentent, à eux seuls, en moyenne 28 000 appels par mois au service à la clientèle de Vidéotron et engendrent des coûts

76 substantiels, quantifiables en millions de dollars par année.

77 L’outil de libre-service Changez vos chaînes, disponible sur les terminaux Illico et le site

78 Internet, enregistre environ 70 000 transactions par mois.

79 Vidéotron affiche dans ses systèmes près d’un million de profils clients différents dus à la multiplication des combinaisons de chaînes sélectionnées, ce qui entraîne une complexité opérationnelle dans la gestion personnalisée de chacun de nos clients.

80 Mais malgré cette ampleur opérationnelle, Vidéotron est très fière d’être conforme en tout point aux exigences du Conseil et de respecter pleinement l’esprit de la politique sur le choix et la

81 flexibilité. Notre offre est simple; elle est claire.

82 Nous avons un seul service de base à 25$ qui jouit d’une promotion assurée étant donné que nous n’offrons aucun premier volet facultatif.

83 Nous offrons depuis longtemps des petits forfaits avec des services sélectionnés « Sur Mesure » par l’abonné.

84 Et enfin, nous avons l’intention de rendre disponibles « à la carte » tous nos services facultatifs dès le 1er décembre 2016.

85 Nous vous remercions et on est, bien sûr, disponibles pour des questions.

86 LE PRÉSIDENT: Merci beaucoup, mesdames et Monsieur Sasseville. Je suis un peu jaloux de ne pas pouvoir dresser des comités d’audition avec autant de diversité. Mais voilà, espérons que le nouveau gouvernement procèdera rapidement à des nominations parce que je suis rendu avec seulement deux conseillers francophones et puis au mois de janvier je n’aurai qu’une seule conseillère pour former les comités d’audience.

87 L’autre chose que je voulais mentionner c’est qu’évidemment le but de l’audience n’est pas seulement d’explorer les manquements mais aussi souligner les comportements exemplaires et d’apprendre ces bonnes pratiques de certains fournisseurs.

88 Donc j’ai une série de questions pour mieux comprendre comment vous avez, dans un premier temps, déployé la première phase du mois de mars et ensuite on pourra explorer le côté qui s’en vient au mois de décembre.

89 Donc pourriez-vous décrire les efforts que Vidéotron a mis en vigueur pour promouvoir vos offres de service à l’approche, justement, de l’échéancier du 1^er mars? Est-ce que vous avez envoyé des courriels aux clients, communiqués de presse, annonces dans les journaux, à la radio, à la télévision, présentations sur votre site web? Si vous pouvez élaborer sur qu’est-ce que vous avez fait en termes pratiques pour faire savoir qu’est-ce qui se passait pour l’échéancier du 1^er mars?

90 Mme BROUILLETTE: Avant de passer la parole à mes collègues, bien sûr au moment de l’échéance, vous allez voir, on va vous expliquer un peu comment on a fait la commercialisation du nouveau petit forfait, mais bien sûr, lorsque l’échéance est arrivée, on a procédé à l’émission d’un communiqué de presse qu’on communiquait de façon plus massive qu’on était conforme et Marie-Ginette et Caroline vont pouvoir élaborer davantage sur tous les outils qu’on a mis en place.

91 Mme LEPAGE: En fait, il y a plusieurs choses qui ont été mises en place au niveau de Vidéotron. La première des choses, évidemment, ç’a été de faire la formation de l’ensemble des membres du service à la clientèle et également dans nos kiosques et boutiques. Donc tous les agents ont été formés sur la nouvelle base, sur comment questionner également les clients, à savoir est-ce que la nouvelle base peut répondre à leurs besoins ou non. Et puis il y a des supports à la vente qui ont été fait également.

92 Et au niveau de la promotion pour les clients, sur le site web, le forfait de base est promu au même titre que nos forfaits sur mesure. Donc comme vous pouvez le voir... bon, encore une fois c’est disparu, mais sur le dépliant que vous avez devant vous, le forfait de base est également promu avec nos forfaits sur mesure et sur notre site web. Donc tous les supports sur lesquels les forfaits sur mesure sont promus, la promotion du forfait de base est également faite.

93 LE PRÉSIDENT: Considérez-vous que votre société a atteint un succès par rapport à ce premier déploiement, notamment à l’égard, je ne sais pas, du nombre de clients qui se sont abonnés à ce forfait de base, le nombre ou le faible nombre, selon le cas, de plaintes reçues et les commentaires de rétroaction sur la clarté de votre offre?

94 Mme BROUILLETTE: En fait, je pourrais dire que oui, on est satisfait. Je pense que la différence par rapport à d’autres joueurs au Canada c’est qu’on était déjà dans cette mentalité-là, nos conseillers, nos agents, parce qu’il y a quand même des défis opérationnels. Quand on change une stratégie, ça prend plusieurs mois avant qu’elle soit vraiment adoptée par l’ensemble des employés. Donc on était déjà là.

95 Comme Marie-Ginette l’a précisé dans son allocution, la base qu’on avait au préalable était pratiquement similaire à la nouvelle base. Donc on n’a pas eu beaucoup d’ajustements.

96 D’ailleurs, j’étais super contente de voir ce matin, il y avait un article dans les journaux qui précisait qu’un journaliste a fait des tests sur plusieurs joueurs et 100 pourcent des fois, nos agents ont proposé la petite base.

97 Donc je pense que mission accomplie jusqu’à présent et puis on est très satisfait de comment ça fonctionne.

98 LE PRÉSIDENT: Si vous aviez à partager vos meilleures pratiques afin d’augmenter le taux de satisfaction de votre clientèle, est-ce que vous avez quelques exemples à partager avec nous publiquement?

99 Mme BROUILLETTE: Je pense que Marie-Ginette l’a bien précisé. L’idée c’est de poser les questions. Puis comprenez-moi bien, nous, ce qu’on veut c’est préserver l’écosystème canadien, donc on veut s’assurer qu’on va répondre aux attentes des consommateurs pour qu’ils ne se tournent pas vers des plateformes alternatives.

100 Donc je pense qu’il faut faire un juste équilibre dans la commercialisation de la petite base mais en s’assurant que les consommateurs ont le maximum de choix, d’où, par exemple, qu’on n’a pas fait de forfaits de volets facultatifs. On va automatiquement à cinq chaînes sur mesure. Donc le client peut se faire son propre volet facultatif personnalisé à ses choix.

101 Donc le seul conseil que je peux donner c’est qu’il faut poser des questions aux clients de manière à comprendre ce qu’ils recherchent et c’est ce qu’on a fait au cours des 15 dernières années. On a quand même une longueur d’avance.

102 Donc opérationnellement, on a roulé la machine et je pense que ça fonctionne.

103 LE PRÉSIDENT: Est-ce que vous avez eu des consultations avec les groupes de consommateurs, les regroupements de consommateurs lorsque vous envisagiez le lancement?

104 Mme BROUILLETTE: Bien, on n’a pas fait de consultations précisément sur la petite base parce que, bon, elle était réglementée, mais en vue du 1^er décembre avec l’arrivée des offres à la carte, c’est certain qu’on a rencontré des consommateurs parce qu’on voulait savoir comment bien communiquer.

105 Le défi dans tout ça, je vous dirais, c’est de simplifier les offres au maximum. Quand je disais tout à l’heure 28 000 appels par mois, ces appels-là, il faut qu’on fasse sûr qu’ils ont une durée assez restreinte parce que au coût que ça a... donc il faut s’assurer que les outils, que la commercialisation ne va pas confondre les clients qui ont une flexibilité, mais que ce n’est pas « overwhelming » si vous me permettez l’anglicisme.

106 Donc voilà.

107 LE PRÉSIDENT: Et si je comprends bien, par rapport au forfait, vous permettez au client, par l’intermédiaire de votre site web, non seulement d’augmenter le nombre de services auxquels ils peuvent s’abonner mais les réduire, qui n’est pas nécessairement le cas pour d’autres fournisseurs au pays?

108 Mme BROUILLETTE: On peut faire tous les changements, n’est-ce pas, les filles?

109 Mme LEPAGE: Oui. En fait, sur le site web et également sur la boîte Illico, on a un service qui s’appelle « Changez vos chaînes ». Donc sur ce service, les gens qui veulent faire des modifications à leur service peuvent le faire sans avoir à nous appeler dans le confort de leur foyer.

110 LE PRÉSIDENT: Étant donné que vous aviez une longueur d’avance, est-ce que d’autres fournisseurs au pays sont venus vous consulter pour voir c’était quoi la potion magique?

111 Mme BROUILLETTE: On a toujours des échanges de façon générale avec nos collègues canadiens. Précisément sur cet élément-là, je pense que ça fait plusieurs années qu’on en discute de toute façon. Donc je ne peux pas vous dire qu’on a eu des rencontres précises avant la mise en place de la politique, mais de façon générale, on a des échanges avec certains joueurs canadiens, oui.

112 LE PRÉSIDENT: De toute façon, vos pratiques sont transparentes parce qu’elles doivent être transparentes pour les abonnés.

113 Mme BROUILLETTE: Oui, absolument.

114 LE PRÉSIDENT: Si quelqu'un vous posait la question est-ce que vous vouliez vraiment que vos clients choisissent l'offre de base ou est-ce que vous tentiez de les décourager de la prendre?

115 Mme BROUILLETTE: C'est une question qui est assez délicate, je vais être vraiment transparente avec vous. L’idée ---

116 LE PRÉSIDENT: C'est pour ça que je la pose.

117 Mme BROUILLETTE: Oui, c'est ça. C'est que il faut qu’on s’assure collectivement -- pis vous m’avez entendu lorsqu’on s’est vu à l’audience « Parlons Télé » -- je pense que l’objectif c'est de mettre le client au centre des pratiques, mais en s’assurant qu’on va quand même favoriser l’écosystème. Donc, la stratégie qu’on a adoptée c'est que il est là, on le promouvoit au même titre que les autres trucs.

118 LE PRÉSIDENT: M'hm.

119 Mme BROUILLETTE: Mais on veut s’assurer -- pour éviter qu’un client qui va se retrouver avec une petite base, après un certain temps dit, « Ça me coûte quand même 25 $ et j’ai pas de chaînes qui répondent à mes attentes. » Donc c'est le juste équilibre qui faut s’assurer d’avoir dans tout ça.

120 LE PRÉSIDENT: Avec la réflexion sur ce qui s’est passé au 1^er mars, est-ce que vous auriez fait des choses différentes avec ce lancement-là du 1^er mars, ou est-ce que vous êtes satisfaits en général du déroulement? Et donc -- donc est-ce qui a des leçons apprises même au sein de votre société que vous pourriez peut-être utiliser pour le lancement du mois de décembre?

121 Mme BROUILLETTE: Ben en fait, je pense la seule chose c'est qu’on a demandé au Conseil le droit d’ajouter certaines chaînes à la base -- à la petite base. Ça nous a été refusé. On est encore d’avis que ce serait bien de pouvoir la bonifier. Ceci étant dit, je pense que à présent une fois qu’on a vécu quelques mois, les choses vont bien. Le fait d’avoir ajouter le « Sur Mesure 5 » vient beaucoup aidé à minimiser cet impact-là.

122 LE PRÉSIDENT: M'hm.

123 Mme BROUILLETTE: Donc c'est certain que je pense que c'est comme ça qu’on a ajusté je vous dirais notre stratégie.

124 LE PRÉSIDENT: Avez-vous l'intention ou est-ce que c'est nécessaire à votre avis de faire d'autres corrections -- de corriger le tir à d’autres égards?

125 Mme BROUILLETTE: Non, on croit pas que c'est nécessaire.

126 LE PRÉSIDENT: D'accord. Des fois on -- vous avez mentionné dans votre présentation l’impact opérationnel, notamment d’avoir à former les gens là qui -- au Service à la clientèle. Pouvez-vous m’expliquer un peu plus ça comporte quoi faire cette formation-là?

127 Mme BROUILLETTE: En fait, nos -- nous on a un guichet unique, donc nos agents sont formés pour répondre sur l’ensemble des produits. Alors c'est certain que déjà en partant on parle de plusieurs semaines de formation. Mais y a rien eu de nouveau en ce qui a trait à la nouvelle réglementation parce que c'était déjà intégré depuis plusieurs années. Mais dans le fond, mon propos y vient juste mettre la lumière sur un élément que tous les autres joueurs canadiens qui débutent dans cette avenue-là vont devoir à faire face.

128 Nous c'est un choix stratégique que nous avons fait à l'époque, qui a eu un retour pour nous. Mais y a effectivement des coûts opérationnels de former les agents. Surtout je dirais aussi y a un travail à faire des télédiffuseurs pour que les agents connaissent bien les chaînes, parce que on les vend une à la fois. Et c'est ça la grande distinction.

129 Donc, beaucoup de formation, beaucoup d’outils. Marie-Ginette le disait, on a énormément d’outils disponibles pour nos vendeurs en magasin, nos agents dans les centres d’appels. Mais il faut comprendre et faut accepter que opérationnellement, ça coûte quelque chose.

130 LE PRÉSIDENT: Si vous aviez à estimer le nombre de personnes qui interagissent avec vous à travers vos centres d’appel par opposition au site web, ce serait quoi à peu près?

131 Mme BROUILLETTE: Le gros, gros des -- d’ailleurs on est tranquillement en train de faire une migration naturelle vers les plateformes numériques. Nos clients plus jeunes sont ---

132 LE PRÉSIDENT: Oui.

133 Mme BROUILLETTE: --- plus enclins à faire ça, donc on ---

134 LE PRÉSIDENT: Pis ça ça des coûts plus -- moins grands pour vous?

135 Mme BROUILLETTE: Et voilà, tout à fait.

136 LE PRÉSIDENT: Donc c'est une décision d’affaires aussi?

137 Mme BROUILLETTE: Tout à fait, c'est ça.

138 LE PRÉSIDENT: Oui.

139 Mme BROUILLETTE: Mais il faut éduquer nos clients. Et bien sûr comme on veut aller à leur rythme, il faut qu’on les éduque progressivement. Mais je vous dirais que 95 pour cent se fait via nos centres d’appels aujourd'hui.

140 LE PRÉSIDENT: Et ça nécessite évidemment des sites numériques qui sont agréables et facile à naviguer?

141 Mme BROUILLETTE: Voila, très convivial.

142 LE PRÉSIDENT: Donc un -- convivial, donc des investissements de ce côté-là aussi?

143 Mme BROUILLETTE: Voilà, oui.

144 LE PRÉSIDENT: Avec ce que vous avez -- bon, peut-être que dans votre cas c’était moins -- un chantier moins grand que pour d’autres, mais avec les apprentissages que vous avez de l’échéance du 1^er mars en route vers l’échéance du 1^er décembre qui est une date butoir, mais vous êtes pas obligés d'attendre au 1^er décembre, comment avez-vous pris la -- comment allez-vous vous organiser autour de la formation de vos agents à la clientèle?

145 Mme LEPAGE: Ben écoutez, ça va être similaire à ce qu’on a fait pour la formation de la petite base. Donc c'est vraiment de pouvoir expliquer aux agents la nouvelle proposition qui peut être fait aux clients, et que l’ensemble des chaînes qui sont disponibles vont maintenant être disponibles à la carte.

146 Mme BROUILLETTE: Je voudrais juste préciser un élément, c'est que déjà nos agents vendent certaines chaînes à la carte, on en a. Le défi que nous avions parce que dans la vision originale c'était de proposer 100 pour cent des chaînes, et bien sûr la réglementation vient nous aider, parce que ça aide aux négociations parce que dans plusieurs cas lorsqu’on ne propose pas la chaîne à la carte, c'est que on a jamais réussi à s’entendre avec le télédiffuseur. Donc ---

147 LE PRÉSIDENT: Oui.

148 Mme BROUILLETTE: --- c'est -- la formation va être là, mais c'est pas un gros changement non plus, c'est plus que la panoplie de chaînes va être plus vaste.

149 LE PRÉSIDENT: Et vous avez bon espoir de pouvoir régler vos engagements d’ici le 1^er décembre vis-à-vis les chaînes de télédiffusion?

150 Mme LEPAGE: En fait, c'est certain que le 1^er décembre l’ensemble des chaînes vont être offertes à la carte.

151 LE PRÉSIDENT: D'accord.

152 Mme LEPAGE: Oui.

153 Mme BROUILLETTE: Mais ---

154 LE PRÉSIDENT: Oui.

155 Mme BROUILLETTE: --- pour vraiment répondre à la question, je ne suis pas certaine qu’on se sera entendu avec tout le monde.

156 LE PRÉSIDENT: Parce qui reste moins ---

157 Mme BROUILLETTE: C'est très difficile.

158 LE PRÉSIDENT: --- il reste moins de 120 jours là.

159 Mme BROUILLETTE: C'est cela. Mais on est très ---

160 LE PRÉSIDENT: On peut vous aider parce qu’on a ---

161 Mme BROUILLETTE: On a d’excellentes équipes qui sont sur le terrain, mais y vont être là les chaînes disponibles.

162 LE PRÉSIDENT: Oui.

163 Mme BROUILLETTE: Mais est-ce que nos ententes vont ententes vont être conformes? Je suis pas certaine.

164 LE PRÉSIDENT: D'accord. Alors pour le 1^er mars est-ce que vous aviez des manuels de formation pour vos agents?

165 Mme LEPAGE: En fait, c'est pas des manuels en tant que tel, on a un site web qui ---

166 LE PRÉSIDENT: Interne, oui.

167 Mme LEPAGE: --- interne qui est dédié à la formation des agents, donc l'ensemble de l’information est diffusée sur ce site interne là.

168 Mme BROUILLETTE: Puis on a des formateurs aussi.

169 Mme LEPAGE: Oui, on a des formateurs.

170 LE PRÉSIDENT: Aussi.

171 Mme BROUILLETTE: C'est ça, y a des classes, on fait ça en classe.

172 LE PRÉSIDENT: Donc est-ce que vous aviez un script particulier par rapport à la petite base?

173 Mme LEPAGE: En fait, comme je vous mentionnais tantôt c'est vraiment -- nous ce qu’on veut c'est que les agents posent des questions aux clients pour vraiment bien comprendre le besoin du client et savoir est-ce que c'est la base qui répond à ces clients -- à ces clients, à ses besoins, pardon, où est-ce que c'est vraiment un autre forfait? Parce qu’on se cachera pas que y a plusieurs clients qui veulent avoir accès à des chaînes spécialisées, chose que la petite base ne peut pas leur offrir, donc pour s’assurer que le client on répond bien à son besoin, mais c'est vraiment plus une série de questions qu’on s’assure que l’agent pose aux clients.

174 Mme BROUILLETTE: Puis aussi ce qu’il faut comprendre, c'est que comme on a pas de volet facultatif, systématiquement on parle de la -- parce que c'est l’entrée, donc vous prenez votre petite base, est-ce que vous écoutez des chaînes spécialisées? On peut vous ajouter 5-10-20-30 chaînes, donc c'est la mécanique. Fait que la manière dont les questions soient posées, automatiquement la petite base est positionnée parce que c'est la seule porte d’entrée.

175 LE PRÉSIDENT: Est-ce que j’ai raison de croire que votre -- vos documents de formation qui sont en ligne forment plus par rapport à la façon d’aller chercher l’information des clients ou ---

176 Mme BROUILLETTE: En fait, c'est pour tous nos produits, hein. Pis on a des classes continues, nous on appelle ça des « cohortes » là, c'est plusieurs matins par semaine ils se retrouvent en groupe. Donc y a des outils pour poser des questions, mais y a des outils d’information pour que nos employés connaissent les produits, donc les offrent. Alors ces dépliants-là ils les ont. Comme Marie-Ginette disait, y a des petites vidéos, nos agents doivent automatiquement passer à travers les classes vidéos en plus des classes physiques avec un formateur, donc ils peuvent pas le manquer là.

177 LE PRÉSIDENT: M'hm.

178 Mme BROUILLETTE: C'est -- pis là je suis en train de parler de notre recette, c'est ça qui fait qu’on est numéro 1 en service client. On a énormément d’énergie qu’on met dans la formation de nos agents pour qu’ils soient oui, à l’écoute, posent les questions, mais recommandent aussi le bon produit.

179 LE PRÉSIDENT: Si je vous demandais de -- d’identifier -- je sais pas si c'est des pages imprimées de votre site intranet ---

180 Mme BROUILLETTE: Oui.

181 LE PRÉSIDENT: --- et peut-être les autres documents ---

182 Mme BROUILLETTE: Oui.

183 LE PRÉSIDENT: --- est-ce que vous seriez en mesure de nous les fournir ---

184 Mme BROUILLETTE: Oui.

185 LE PRÉSIDENT: --- en termes d’engagement?

186 Mme BROUILLETTE: Oui, mais sous -- c'est ça, sous confidentialité.

187 LE PRÉSIDENT: Mais c'est ---

188 Mme BROUILLETTE: Mais ça va nous faire plaisir, absolument.

189 LE PRÉSIDENT: --- votre ---

190 Mme BROUILLETTE: On peut même vous envoyer des petites vidéos qu’on a.

191 LE PRÉSIDENT: C'est ça. Donc ---

192 Mme BROUILLETTE: Parfait.

193 LE PRÉSIDENT: --- c'est votre choix de demander la confidentialité ---

194 Mme BROUILLETTE: Excellent.

195 LE PRÉSIDENT: --- vu que vous connaissez nos procédures. Donc si vous pourriez faire d’ici -- je pense qu’on va l’utiliser comme date butoir pour tous les engagements, on va dire -- à moins que des gens sont en -- sont capables d’écrire des raisons d’exception là, mais on va aller vers 5 heures, heure de Vancouver, donc 8 heures, heure d’Ottawa vendredi. Ça y irait? Oui? Merci

196 Alors si un abonné transige avec vous et, bon, change leur programmation, leurs options de programmation, peuvent-ils revenir à l’ancien forfait après une période d’essai?

197 Comment ça fonctionne, là? Parce que souvent les gens, n’ayant pas vu la chaîne ou les forfaits, peuvent changer d’idée. Donc comment ça fonctionne? Combien de temps? Quels sont les critères? Est-ce qu’il y a des pénalités ou des frais supplémentaires dans ces cas-là?

198 Mme LEPAGE: Si je comprends bien votre question, un client qui prendrait, par exemple, un sur mesure 10...

199 LE PRÉSIDENT: Oui.

200 Mme LEPAGE: ...et après un certain temps, il veut passer à un sur mesure 5, donc à ce moment-là il peut le faire. Il n’y a pas de pénalité qui est associée au fait de changer un forfait. Et à l’intérieur de son forfait, s’il veut simplement changer sa programmation, ça, également, il peut le faire et il pourrait changer, par exemple, ses chaînes, s’il le voulait, à tous les mois sans aucune pénalité de ce côté-là également.

201 Mme BROUILLETTE: Par contre... puis corriges-moi, Marie-Ginette... l’ancienne base que nous avions...

202 LE PRÉSIDENT: Oui.

203 Mme BROUILLETTE: ...s’il décide d’aller à la petite base, l’ancienne base n’est plus disponible dans nos systèmes après.

204 Mme LEPAGE: C’est exact.

205 Mme BROUILLETTE: Donc à ce moment-là il va devoir rester sur la nouvelle petite base et puis prendre... aller vers un sur mesure 5 qui, dans le fond, vient répliquer l’ancienne petite base qu’on avait.

206 LE PRÉSIDENT: Donc ceux qui sont « grand-pèrisés » ...

207 Mme BROUILLETTE: Oui, c’est ça.

208 LE PRÉSIDENT: ...comme on dit souvent, peuvent pas retourner en arrière. Une fois qu’ils ont fait le choix, ils ne peuvent pas retrouver le forfait historique qu’ils avaient il y a 10-15 ans?

209 Mme LEPAGE: C’est exactement ça parce qu’il n’est plus disponible.

210 LE PRÉSIDENT: D’accord.

211 Mais vous permettez aux abonnés de maintenir ce qu’ils ont à l’heure actuelle?

212 Mme LEPAGE: Absolument.

213 LE PRÉSIDENT: Dans ce cas-là, c’est quoi les obstacles à... je sais que vous ne l’offrez plus, mais est-ce qu’il y a des obstacles informatiques qui vous empêcheraient de retourner quelqu’un qui avait un forfait historique qui essaye la petite base avec peut-être un forfait 5 sur mesure de retourner en arrière? Qu’est-ce qui l’empêche? Je comprends que vous ne voulez pas le faire peut-être du plan d’affaires, mais est-ce qu’il y a d’autres contraintes qui vous amènent à cette décision-là?

214 Mme BROUILLETTE: En fait, c’est deux choses. C’est que premièrement, c’est une complexité opérationnelle.

215 LE PRÉSIDENT: O.k.

216 Mme BROUILLETTE: Donc nous, c’est un choix qu’on a fait depuis plusieurs années. Nos offres sont simples, pas de frais cachés. Qu’est-ce que vous voyez, c’est là. Donc c’est une stratégie d’entreprise.

217 Deuxième élément c’est qu’on a considéré que faire un retour en arrière pour un client c’est très facile parce qu’il y a juste... parce que de la manière que notre petite base a été faite à l’origine, il y avait, je pense, RDI en plus dans la base, mais tout de suite notre base c’était une base plus simple. Donc t’avais une base, puis tu choisissais cinq chaînes comme tu voulais en tant que client.

218 Donc c’est un peu la même chose qu’on va dire à nos clients, c’est « Prenez la petite skinny; ajoutez-vous cinq chaînes et voilà. » Donc, tu sais, c’est pratiquement similaire. Donc le « trade-off » d’avoir l’enjeu opérationnel, de garder ça dans les systèmes, nos agents qui viennent se mélanger entre l’ancienne base, la nouvelle, c’était préférable de procéder comme ça.

219 LE PRÉSIDENT: D’accord.

220 Quels changements proposez-vous mettre en place d’ici la fin de l’année justement pour que vous offriez des services discrétionnaires conformément à la réglementation? Est-ce que vous allez attendre justement jusqu’au 1^er décembre? Est-ce que vos plans sont de faire d’autres changements dans votre offre ou tout simplement... expliquez-moi le document, à quoi il ressemblerait si on était le 1^er décembre.

221 Mme LEPAGE: Évidemment l’ensemble des chaînes à la carte vont être disponibles. Donc ça sera ajouté à nos documents et également, on se... présentement on est en train de regarder à voir s’il y a différentes formulations qui doivent également être faites et ça c’est quelque chose qu’on pourrait également soumettre au Conseil sous pli confidentiel.

222 LE PRÉSIDENT: S’il vous plaît. Est-ce que c’est possible d’ici vendredi à 5h00, heure de Vancouver?

223 Mme LEPAGE: En fait, on va être en mesure de vous soumettre la réflexion jusqu’où elle est rendue.

224 LE PRÉSIDENT: Oui, oui, je comprends. Je comprends, avec les cavéats que vous voulez mettre.

225 Mme LEPAGE: C’est ça.

226 LE PRÉSIDENT: Je comprends qu’il y a quand même une réflexion d’affaires qui continue, mais c’est dans 120 jours ou moins donc il faut quand même avoir un plan d’affaires, n’est-ce pas?

227 Mme BROUILLETTE: Mais dans le fond, ce qu’on peut peut-être dire aujourd’hui déjà c’est qu’il n’y aura pas énormément de changement parce que vous voyez déjà dans le dépliant il y a une section « Chaînes à la carte. » Donc là on va juste ajouter... on est déjà là, nous. On va juste ajouter toutes les chaînes.

228 Là, ce qu’on va faire c’est regarder comment les concurrents vont se positionner et puis s’ajuster si on a besoin de le faire. Ça fait que je ne suis pas certaine. On va voir ce qu’on a, mais je suis pas certaine que ça va vous éduquer énormément parce que la stratégie, à la base, c’est on ajoute les chaînes et puis on va s’ajuster en fonction de ce que le marché va faire.

229 LE PRÉSIDENT: Donc évidemment nous on est intéressé de s’assurer un marché concurrentiel, parce que c’est toujours mieux de se baser sur la concurrence plutôt que sur la réglementation.

230 Quel genre de comportement envisagez-vous de la part de vos concurrents dans votre marché?

231 Mme BROUILLETTE: C’est une bonne question. En fait, on a déjà vu certaines des chaînes à la carte qui sont disponibles chez notre concurrent principal. Donc on se questionne sur le prix, sur le prix de vente. On va voir... on fait nos analyses en ce moment. On va voir comment on se positionne.

232 Mais, tu sais, c’est la réalité quotidienne en télécom. Donc je vous dirais que ça nous amène pas un stress additionnel cette situation-là parce qu’on vit ça tous les jours depuis de nombreuses années. On est « runné » en ce sens.

233 Mais le point que je voulais faire aujourd’hui c’est que ça peut changer à tout moment. C’est ça la nature de la bête et on doit s’adapter au fur et à mesure.

234 Donc je pense que notre concurrent va être agressif, comme ils le sont, comme on l’est à nos heures. Ça fait partie de la dynamique. On veut gagner les clients. Mais ce qui importe pour nous, je vous dirais, c’est de garder nos clients une fois qu’on les a et on va, je pense, rester sur notre terrain de poser les bonnes questions, écouter nos clients et ajuster nos offres de manière à répondre le maximum aux attentes de ceux-ci.

235 LE PRÉSIDENT: Et d’ailleurs, si je comprends bien, lorsque vous avez, il y a quelques années, adopté une structure sur mesure, vos concurrents ont dû s’adapter au Québec à votre pratique même s’ils ne les ont pas adoptées dans d’autres territoires où ils desservaient aussi?

236 Mme LEPAGE: Oui, c’est exact.

237 LE PRÉSIDENT: Donc vous avez eu un impact sur le comportement des concurrents?

238 Mme LEPAGE: En fait, on a eu un impact. On peut penser qu’on a eu un impact, effectivement, parce que les clients étaient très, très satisfaits de pouvoir choisir des chaînes. Donc les concurrents ont regardé ce qu’on faisait, ont trouvé potentiellement que c’était une bonne idée puisqu’ils nous ont suivis.

239 LE PRÉSIDENT: Je constate que vous offrez aussi gratuitement télé à la carte pour les gens qui ont la petite base, puis aussi, j’imagine, le canal de promotion en clair des autres services? Quoi d’autre qu’on peut obtenir? Il y a vraiment la télé à la carte?

240 Mme LEPAGE: En fait, les gens ont accès au portail de vidéo sur demande lorsqu’ils prennent la petite base et ont accès également à la télévision à la carte.

241 LE PRÉSIDENT: Puis vous avez choisi... puis c’est gratuit?

242 Mme LEPAGE: C’est ça. En fait, sur le portail de vidéo sur demande, les gens ont accès à des contenus gratuits. Ils ont accès également au contenu des chaînes qui sont dans le petit forfait et peuvent également, s’ils le désirent, avoir de la vidéo sur demande transactionnelle.

243 LE PRÉSIDENT: Quelle était la pensée d’affaires quand vous avez fait ce choix-là, parce que d’autres concurrents ne l’ont pas fait?

244 Mme BROUILLETTE: Bien, on le faisait déjà encore là et notre principe c’est de donner des valeurs ajoutées. Donc c’est un choix. C’est un choix d’affaires. Encore là, il y a un coût parce qu’il y a des frais associés à ça, mais on persiste à croire que c’est la bonne avenue.

245 LE PRÉSIDENT: Merci.

246 On entend... on lit parfois les gens dire qu’à leur avis... les consommateurs disent ça ou ils semblent dire... ils semblent se plaindre que les services à la carte sont beaucoup plus dispendieux que des services en forfaits. Et d’ailleurs on pourrait se demander pourquoi le prix au détail des services à la carte, qu’ils soient canadiens ou non canadiens, est parfois sensiblement plus élevé au détail que le montant que vous négociez avec les grossistes, c’est-à-dire les fournisseurs de chaînes de télédistribution.

247 Est-ce que vous pensez que c’est une fausse impression ou que c’est une bonne impression? Comment vous allez aborder la perception que certains vont craindre que lorsqu’on va avoir de la télé à la carte, les prix seront tellement élevés que vous allez forcer les gens nécessairement d’aller vers des forfaits sur mesure?

248 Mme BROUILLETTE: En fait, ça va être un défi d’industrie parce que, effectivement, si on tarifie ces chaînes-là à l’unité trop chères, comme on dit en bon québécois, on va se tirer dans le pied.

249 L’objectif c’est de s’assurer... puis ça, je parle vraiment de notre expérience acquise avec tout le libre choix... c’est de toujours faire la bonne mécanique financière pour que le client ait le sentiment qu’il en a pour son argent puis qu’on soit capable de faire face à nos obligations.

250 Mais dans les faits, je ne sais pas où ça va atterrir parce que, comme je vous dis, on n’a pas finalisé nos ententes et vous allez comprendre que les ententes qu’on n’a pas finalisées c'est les plus difficiles à conclure.

251 LE PRÉSIDENT: Oui.

252 Mme BROUILLETTE: Où justement la redevance qui nous est demandée est extrêmement élevée qui va nous imposer à refiler cette -- ce coût-là aux consommateurs.

253 Mais j’ai confiance je vous dirais en l’industrie. Je pense qu’on est tous là pour -- j'aimerais pas dire juste pour survivre mais pour stimuler les Canadiens à adopter l’écosystème canadien plutôt que de se retourner vers les Netflix de ce monde, mais il va falloir collectivement on fasse un effort.

254 Il va falloir qu’on réfléchisse parce qu’une des craintes que nous avons et que je vous avais mentionnée lors de la première audience c'est que, une fois qu’on va lancer les chaînes à la carte, nous on a énormément d’expérience à savoir quels types de chaînes sont populaires. Depuis des années, les clients les choisissent.

255 Y en a qui vont gagner. Y en a qui vont perdre mais ce qui faudrait pas se retrouver c'est qu’on a 100 pour cent des Canadiens qui ont que la petite base puis qu’ils prennent une chaîne de sports ou une chaîne premium puis qu’ils s’abonnent le reste à Netflix et compagnie parce que là c'est tous les télédiffuseurs canadiens qui vont perdre et c'est notre écosystème qui va en être grandement affecté.

256 LE PRÉSIDENT: Lorsque vous songez à la tarification d’une chaîne à la carte, y a évidemment le prix de gros qui influence le prix au détail. C'est quoi les autres facteurs économiques que vous considérez?

257 Mme BROUILLETTE: Ben je vous dirais c'est beaucoup le prix de gros qui est -- mais les taux de pénétration parce que le prix de gros est affecté par les taux de pénétration des chaînes. On a encore ça dans les contrats. Donc c'est un juste équilibre.

258 C'est o.k., comment on fait pour rendre attrayant un forfait? Encore là, nous on n’a plus de forfaits thématiques. On est beaucoup plus vers les « Sur Mesure ». Alors, comment encore là tout -- on se repose beaucoup sur nos conseillers pour encore là en posant les bonnes questions, est-ce que vous êtes quelqu’un qui aimez les films, est-ce que vous êtes quelqu’un qui aimez les émissions, qui aimez le sport, de manière à diriger le client vers les types de chaînes à la carte qu’il va pouvoir prendre -- et je vous le cacherai pas en probablement favorisant des forfaits sur mesure, de dire si vous en prenez juste une, prenez ce forfait-là de cinq chaînes puis en avez cinq.

259 Donc ça va être vraiment un juste équilibre à donner tout ce que le client veut mais s’assurer que le système se tire pas dans le pied par la même occasion.

260 LE PRÉSIDENT: Oui, et que les consommateurs ont l’impression que vous leur offrez plus de chaînes parce que c'est dans leur intérêt plutôt que dans votre intérêt.

261 Mme BROUILLETTE: Oui, puis j'aimerais pas dire ont l’impression. Je voudrais qu’ils soient convaincus de ça.

262 LE PRÉSIDENT: Oui, oui, o.k.

263 Mme BROUILLETTE: Je veux dire faut faire la bonne affaire dans le fond.

264 LE PRÉSIDENT: Mais vous appliquez sur le tarif en gros un « markup », comme disent les Chinois, pour -- qui est plus élevé. C'est un autre élément économique dans le prix au détail, n'est-ce pas?

265 Mme BROUILLETTE: Oui, mais cet élément-là vous regarderiez des analyses financières et les marges en télé réduisent année après année. Donc ce « markup » là comme vous l’appelez, il est en déclin.

266 Ce qu’il faut comprendre aussi c’est que -- puis c'est quand on va sur le terrain des OTT, c'est un autre dynamique. Nous on a un réseau pour distribuer le portail de vidéo sur demande. Les Capex qu'on met par année dans le système de télédistribution sont très importants.

267 Alors ça dépend quand on regarde la mathématique-là, si on la regarde d’un point de vue génération de cash, c'est clairement pas la télédistribution chez un opérateur qui génère le plus de cash à fin de l’année-là.

268 LE PRÉSIDENT: M’hm. Mais y a une partie de ces dépenses-là qui sont couverts par le 25$ dans votre cas, n'est-ce pas?

269 Mme BROUILLETTE: Oui, bien sûr mais c'est pas -- si c'était 100 pour cent de nos clients qui prenaient le 25$, je pense que ça serait très difficile d’avoir une ligne d’affaire de la télédistribution qui serait rentable.

270 LE PRÉSIDENT: M’hm. Vous savez que dans l’industrie y a d’autres fournisseurs qui ne semblent pas offrir les escomptes de forfaits, les « bundling discounts ». Je crois que c’est pas votre cas à vous. Les gens ont quand même accès au -- s’ils prennent votre service de câblodistribution, ça avoir un impact sur leur service internet, sur leur service téléphonique aussi, c'est ça?

271 Mme PAQUET: Oui. En fait, chez Vidéotron, en ce moment quelqu’un qui appelle puis qui prend un produit de base avec un autre produit va avoir accès au même -- à un escompte. Donc on maintient notre stratégie actuelle.

272 LE PRÉSIDENT: Même si ils sont abonnés qu’à la petite base?

273 Mme PAQUET: Oui.

274 LE PRÉSIDENT: Vous en demandez pas plus pour bénéficier du forfait -- d’autres forfaits-là avec les autres services?

275 Mme BROUILLETTE: Non. Non, non. On a les forfaits jumelés.

276 LE PRÉSIDENT: Mais peu importe la ---

277 Mme BROUILLETTE: Peu importe. S’il a la base puis qu’il s’ajoute internet, il va avoir ---

278 LE PRÉSIDENT: Le forfait s’applique.

279 Mme BROUILLETTE: C'est ça, oui.

280 LE PRÉSIDENT: Puis vous avez décidé de faire ça pour quelle raison parce que d’autres ont choisi de ne pas le faire de cette façon-là?

281 Mme BROUILLETTE: Mais on le faisait déjà. Là ce qu’on est en train d’évaluer c'est -- parce que nos forfaits jumelés sont très complexes, donc dans cette veine de simplifier, on est en train de les revoir.

282 D’ailleurs, il va y avoir une nouvelle politique qui va être implantée je sais pas c'est qui la date-là mais encore là, ça va être applicable. Ça va être très simple, 5, 10 ou 15$ dépendamment de la combinaison. Mais vous avez une petite base télé puis vous combinez ça à un produit internet, vous allez accéder à ces rabais-là.

283 LE PRÉSIDENT: Et toujours dans le but que l’offre soit simple ---

284 Mme BROUILLETTE: Oui.

285 LE PRÉSIDENT: --- et donc communiquer par des plateformes numériques.

286 Mme BROUILLETTE: Oui.

287 LE PRÉSIDENT: Et donc ça réduit vos coûts internes parce que vous avez pas des lignes téléphoniques à gérer.

288 Mme BROUILLETTE: Voilà.

289 LE PRÉSIDENT: Je note que plusieurs petites entreprises de distribution semblent offrir leurs services de base à moindre prix que votre 24.95 ou quelque chose comme ça, disons 25$. On en voit à 18 et 20$, mais c'est pas votre cas.

290 Pouvez-vous m’expliquer pourquoi vous avez décidé de charger le plein montant de 25$?

291 Mme PAQUET: Mais toujours dans la même optique de simplification, 25$ c'était un bon prix mais aussi chez nous on n’a pas de frais cachés. C'est 25$. C'est le prix. C'est simple pour les clients. C'est simple également pour tout le service à la clientèle. Donc c'est un choix d’affaire.

292 Mme LEPAGE: Puis si je peux me permettre d’ajouter, avec le 25$, comme mentionne Caroline, y a pas de frais additionnels. Donc ça inclut évidemment le HD dans le prix de 25$ et comme on l'a mentionné également plus tôt, ça inclut également le portail de la vidéo sur demande, la télé à la carte, donc frais numériques, et cetera. Pour ça on a voulu vraiment garder un seul prix pour pouvoir donner l’ensemble de ces avantages-là à notre client.

293 LE PRÉSIDENT: Donc le fait que d’autres offrent à 18 ou 20$, ça n’a pas eu un impact pour vous forcer d’aller à un montant moindre?

294 Mme BROUILLETTE: Non, parce que quand vous ---

295 LE PRÉSIDENT: Certains pourraient dire qu’en vertu de la Loi sur la concurrence, vous agissez un peu d’une façon dominante dans ce cas-là.

296 Mme BROUILLETTE: Je suis pas d’accord parce qu’il faut décortiquer les offres des autres. Ils vont tous arriver à 25$ parce qu’ils ajoutent un 3$ de frais numériques, un autre frais de signal HD. Donc c'est une technique de communication.

297 Nous, on a ce positionnement-là pas de frais cachés. C'est 25, ça vient avec tout. Donc on pourrait décider qu’on le décortique mais à la fin de la journée, le client va payer la même chose de toute façon.

298 LE PRÉSIDENT: Depuis le lancement du 1^er mars, est-ce que vous avez fait des changements par rapport à l’offre des services pour les frais d’équipement ou les frais d’installation, ou ça c'est demeuré plus ou moins stable?

299 Mme PAQUET: C'est demeuré tel quel. En fait, chez Vidéotron, lorsqu’un technicien se déplace pour faire l’installation de deux services ou plus, l’installation est incluse et quand c'est pour un seul service, que ce soit l’internet, la télé de base ou un « Sur Mesure », ben y a un frais d’installation qui s’applique. Même stratégie.

300 LE PRÉSIDENT: Encore pour des raisons de simplicité?

301 Mme PAQUET: Absolument.

302 LE PRÉSIDENT: Est-ce que vous planifiez faire d’autres ajustements au prix par rapport aux frais d’équipement et d’installation d’ici les quelques mois-là, d’ici le lancement de la fin de l’année?

303 Mme LEPAGE: Écoutez, c'est certain qu’on est toujours à l’affût de ce qui se passe dans notre marché mais pour le moment, y a rien de prévu en ce sens-là.

304 LE PRÉSIDENT: Dans votre cas pour les boîtes, quelle est votre pratique? Est-ce que les gens les louent, les achètent? C'est quoi le mixe? Ça dépend des générations de boîtes j’imagine aussi.

305 Mme PAQUET: Mais en fait, nous ça fait déjà quelques années qu’on est comme ça. On propose toujours en fonction des besoins du client. Donc on propose -- le client peut décider d’acheter ou de louer. Puis bien évidemment, y a des gammes de prix en fonction des types de terminaux.

306 LE PRÉSIDENT: Si je vous disais -- puis c'est une hypothèse, donc je cherche votre réaction -- que, en général, le coût d’équipement électronique est en baisse en général, surtout quand c'est une deuxième ou troisième génération. Néanmoins, on semble voir que les prix pour l’équipement, comme les boîtes numériques, n’est pas en décroissance.

307 Est-ce que -- peut-être j’ai tort. Je vois votre expression. Peut-être que vous pensez que c'est tout à fait l’inverse. Je voulais savoir aussi d’apport les fournisseurs en gros de ces boîtiers-là, comment vous -- est-ce que leurs prix sont à la base et est-ce que vous prenez ces économies-là et les transférez à vos abonnés au détail?

308 Mme BROUILLETTE: En fait, l’acquisition d’une boîte c'est un frais à l’entrée énorme, donc c'est certain que nous dès -- année après année on négocie -- dès qu’on a des réductions on les refile automatiquement au consommateur. C'est pas -- c'est pas un équipement -- on essaie pas de faire du profit sur l’équipement. Donc -- pardon? On perd même, effectivement, on subventionne à l’entrée.

309 Donc c'est certain que on met beaucoup de pression sur nos fournisseurs, mais quand t’es dans la business des équipements, t’es pas dans la business de l’abonnement télé, c'est un -- donc c'est pas la même réalité auquel on fait face. Mais je voulais juste rectifier les faits là, ça tend à baisser ---

310 LE PRÉSIDENT: Donc votre impression ça descend ---

311 Mme BROUILLETTE: Oui.

312 LE PRÉSIDENT: --- ça une tendance à descendre?

313 Mme BROUILLETTE: D'ailleurs juste un exemple, notre boîte 4K est moins chère que la boîte numérique que nous avions avant, donc on a refilé l’économie au consommateur. Et la logique inverse dirait c'est un produit supérieur, on peut le vendre plus cher.

314 LE PRÉSIDENT: D'accord. Donc, comme vous l’avez mentionné, vous étiez une entreprise de distribution avec plusieurs succès, de l’innovation et tout ça, et puis que vous étiez les -- un des premiers ou les premiers à offrir plus de choix à votre clientèle.

315 Pouvez-vous m’expliquer un peu plus pourquoi que vous êtes venu à cette décision d’affaires à l'époque? Et est-ce qui a une spécificité du marché francophone québécois qui fait en sorte que c'était plus facile à mettre en vigueur?

316 Mme BROUILLETTE: On a débuté ça -- en fait, c'est bien avant -- moi ça fait 12 ans que je suis là, on a débuté ça voilà 15 ans. Ceci étant dit, on a commencé à commercialiser je dirais de façon -- j’aime pas dire le mot « agressif », mais ça été notre cheval de tête en ce qui a trait à la télé autour de 2004. Pis ça carrément été une décision qu’on a pris, on cherchait à se différencier de notre concurrent et on a misé là-dessus puis on a vu qui avait de la traction. Les consommateurs répondaient à ça, alors ça nous a juste renforcés dans notre stratégie. Donc ça purement été une décision d’innovation, on voulait se différencier, comment on peut être différent des autres, et clairement ça fonctionné.

317 LE PRÉSIDENT: Puis vous desservez des foyers anglophones aussi?

318 Mme BROUILLETTE: On dessert autant des foyers anglophones que francophones, mais on est catégorisé comme un jouer franco.

319 LE PRÉSIDENT: Oui, mais en terme de si quelqu'un venait nous dire, « Ben y a une spécificité de langue » ---

320 Mme BROUILLETTE: Non.

321 LE PRÉSIDENT: --- votre expérience dans les abonnés anglophones au Québec serait tout-à-fait transférable ailleurs?

322 Mme BROUILLETTE: Tout à fait. Le choix n’a pas de langue dans mon livre à moi, c'est deux choses très différentes. C'est sûr que ça été difficile à négocier, faut pas se le cacher.

323 LE PRÉSIDENT: M'hm.

324 Mme BROUILLETTE: J’étais là aux premières heures, au départ on nous mettait des taux de pénétration, on mettait dans les contrats là -- tout le monde nous imposait un paquet de clauses pour s’assurer que le monde irait pas sur de la flexibilité, mais prendrait à l'époque le Télémax pis le Méga. Donc ça été -- on a vraiment travaillé très fort pour livrer cette flexibilité-là au consommateur.

325 Mais une fois qu’elle est livrée, que tu sois anglophone, francophone, allophone, de choisir ce que tu veux écouter c'est juste le gros bon sens là.

326 LE PRÉSIDENT: O.k. Par rapport au déroulement là pour l’échéance ultime du 1^er décembre, est-ce que à votre avis vos plans se déroulent comme prévu?

327 Mme LEPAGE: Oui, pour le moment on a pas d’embûches à par peut-être comme Manon l’a mentionné, certaines négociations qui sont un petit peu plus difficiles avec certains groupe médias, mais pour le reste on est sur le plan.

328 LE PRÉSIDENT: Et pour bien saisir, peut-être que la réponse de l’engagement que vous avez mentionné plus tôt va répondre à ma question, mais comment entendez-vous faire la promotion de la nouvelle approche là au 1^er décembre?

329 Mme LEPAGE: Ben en fait, ça sera pas différent de l’approche qu’on prend présentement. Alors sur l’ensemble -- ben, au niveau de notre service à la clientèle, évidemment y aura bon, formation, outils à la vente, et cetera. Et pour les consommateurs on va mettre à jour nos dépliants, le site web, et cetera, pour s’assurer là qu’on en fasse la promotion auprès de la clientèle.

330 LE PRÉSIDENT: Donc dans la première phase vous avez pas eu beaucoup de plaintes parce que c'était pas un très grand changement, mais si il s’avère que vous avez des plaintes ou qui a une confusion dans l’offre; c'est quoi vos plans pour traiter de cette possibilité?

331 Mme LEPAGE: Bon, effectivement on a eu très peu de plaintes sur l’introduction du 1^er mars. Si on a des plaintes par la suite avec l’introduction au 1^er décembre, écoutez, c'est certain qu’on va prendre en considération les plaintes qu’on a et voir si il y a lieu de s’ajuster. Comme on voulait le faire -- on l’a mentionné tantôt également là, comme on voulait le faire en vous demandant de pouvoir ajouter des chaînes additionnelles sur la petite base, ce qui nous avait été refusé. Mais très certainement on va regarder si y a des ajustements à faire.

332 LE PRÉSIDENT: Mais vous êtes pas du tout amère parce que ça fait maintenant deux fois que vous le rementionné.

---(LAUGHTER)

333 LE PRÉSIDENT: Dans le document que vous voues êtes engagée de déposer, est-ce que on va pouvoir voir -- et puis je comprends que vous allez le déposer sous pli confidentiel, vous demandez la confidentialité -- sur les fourchettes de prix au détail que vous envisagez? Avec l’information que vous avez aujourd'hui, je sais là que y a encore des négociations qui continuent.

334 Mme LEPAGE: Oui, on va être en mesure de déposer ça.

335 LE PRÉSIDENT: Ça va être pour tout ---

336 Mme LEPAGE: Oui.

337 LE PRÉSIDENT: Ben en fait c'est pas des fourchettes, vous allez pouvoir nous dire à peu près pour chaque chaîne quel sera le prix à la carte?

338 Mme LEPAGE: On va vous déposer ça, absolument.

339 LE PRÉSIDENT: Avec j’imagine quelques astérix pour bien expliquer que ---

340 Mme LEPAGE: Et voilà.

341 LE PRÉSIDENT: --- y a des choses qui sont hors votre contrôle au moment où on se parle. Est-ce que vous vous engagez en plus d’ici le 1^er de mettre à jour cette information pour le Conseil? Parce que vos plans vont changer, oui, oui. Donc ---

342 Mme LEPAGE: Oui, oui, y a aucun problème.

343 LE PRÉSIDENT: --- c'est un engagement continu?

344 Mme LEPAGE: Oui.

345 LE PRÉSIDENT: Ça va ça? Oui. Est-ce que y va y avoir des coûts supplémentaires ou des contraintes additionnelles pour ceux qui s’abonnent à la petite base qui veulent avoir quelques postes à la carte? Est-ce que vous avez l’intention d’avoir des frais supplémentaires ou ça serait contraire à votre philosophie de simplicité?

346 Mme LEPAGE: En fait ça serait contraire à notre philosophie, donc quelqu'un qui prend la petite base va pouvoir prendre une chaîne, deux chaînes, trois chaînes à la carte sans avoir de contraintes additionnelles.

347 LE PRÉSIDENT: Et les services à la carte sont disponibles peu importe les forfaits de base ou les ---

348 Mme LEPAGE: Les « Sur Mesure ».

349 LE PRÉSIDENT: --- le nombre de « Sur Mesure »? C'est ---

350 Mme LEPAGE: Exactement, donc toutes les chaînes à la carte vont être disponibles peu importe le forfait auquel l’abonné est abonné.

351 LE PRÉSIDENT: Et est-ce que les clients qui auront choisi peut-être un modèle de service de base plus à la carte pour certaines chaînes, est-ce qu’ils seront admissibles aux autres promotions? Ben des promotions ---

352 Mme LEPAGE: Je suis pas certaine de comprendre la question.

353 LE PRÉSIDENT: --- de forfaits, des promotions par « bundling » là pour l’internet ---

354 Mme LEPAGE: Ben en fait ils vont avoir accès parce que ils doivent prendre le service de base.

355 LE PRÉSIDENT: Oui, donc vous envisagez pas un changement de votre pratique actuelle?

356 Mme LEPAGE: Non.

357 LE PRÉSIDENT: D'accord.

358 J’aurais dû annoncer à mes collègues que c'était ma dernière question pour voir si eux y auraient des questions, mais on va voir si Mr. Simpson or Mr. MacDonald? Non. Conseiller juridique, non plus?

359 Alors merci beaucoup pour vos réponses. Et comme je vous ai dit, on est pas toujours là pour souligner les mauvais coups des entreprises, mais peut-être d’apprendre des bons coups aussi. Donc merci bien de votre préparation et de votre participation à l’audience.

360 Je crois que on va prendre la pause du matin à ce stade-ci, 10 heures et quart, donc on va revenir à 10 heures et 25. We’re adjourned until 10:25.

361 Thank you.

--- Upon recessing at 10:07 a.m.

--- Upon resuming at 10:25 a.m.

362 LE PRÉSIDENT: À l’ordre, s’il vous plait.

363 Madame la secrétaire.

364 THE SECRETARY: Thank you, Mr. Chairman.

365 We will now proceed with item 2 on the agenda and a presentation by Rogers Communications Canada Inc. Please introduce yourself and your colleagues and you will then have 20 minutes for your presentation.

366 Thank you.

367 MR. WATT: Thank you.

PRESENTATION

368 MR. WATT: Good morning, Mr. Chairman and Commissioners. My name is David Watt, I’m Senior Vice President, Regulatory at Rogers. To my left is Pam Dinsmore, Vice-President, Regulatory-Cable; to my right is Melani Griffith, Senior Vice President, Content, and Melani was the executive sponsor of her implementation of this program; and to Melani’s right is Jon Medline, Director, Video Programming. In the back row is Peter Kovacs, Director, Regulatory, Content Distribution Policy; and to Peter’s right is Dilhan Kamalendaran, Senior Manager, Video Product.

369 Rogers has long been committed to the kind of consumer choice promised by the new packaging regime that emerged from the Let’s Talk TV process, and we are pleased to share with you our progress to date on implementing that regime.

370 Today, we will describe our experience since March with our small basic service, branded “Starter”, and our new theme packs. We will then explain how our approach has evolved over the past 6 months in response to the needs of our customers and the offerings of our competitors.

371 Our efforts to provide more consumer choice began five years ago when we launched a pick and pay market trial in London, Ontario. Trial participants subscribed to a small basic service and then had the option to create their own packages from a list of 125 specialty channels. The lessons we learned from the London trial informed our early efforts to provide our customers with packaging flexibility, as well as the approach we took in implementing the new flexible packaging regime.

372 Pam?

373 MS. DINSMORE: Thank you.

374 On March 1st of this year, we introduced our Starter basic package. It varies by region but typically consists of approximately 35 programming services. It includes a set of U.S. 4+1 signals, as well as high definition versions of most of the services. Priced at $24.99, Starter is available in all of our licensed systems and, although not required, in many of our exempt systems as well.

375 Starter customers are able to access video on demand, pay‑per‑view and TV Everywhere online extensions at no additional charge. Those who want more programming may choose one or more of our 29 English and French language theme packs, as well as our multicultural packages and premium services like TMN and Super Channel. Each package has a maximum of 10 services.

376 We took great care in designing and pricing our 29 theme packs. We grouped together the channels we believed customers would want in a package, and we did so using only four price points. This simplifies the options available and makes it easier for customers to understand the impact of choosing one or more packages.

377 Our small basic service and our theme packs have caught on with consumers. We continue to add new Starter customers, and existing subscribers have migrated to the new offerings as well. The total number of customers taking Starter has grown each week since March.

378 When we launched Starter and the new theme packs, we continued to offer our long-established "first tier" basic service and our existing pre-assembled packages. This way all customers could select the best TV experience to satisfy the diverse viewing needs within their household.

379 All Rogers digital customers, whether they subscribe to Starter and theme packs or to larger packages, either rent or buy a set‑top box in order to receive their programming. Today, we market HD and 4K boxes so that customers can maximize their TV viewing experience.

380 For those customers who do not wish to access HD programming, we still make SD boxes available. However, we are phasing them out, so the supply is limited.

381 Our online and retail marketing materials clearly describe the cost of Starter and our theme packs as well as the channels each package includes. In addition, we use direct mail to promote the availability of Starter and our theme packs to various cable, non‑cable and Internet-only households within our serving areas.

382 Through campaigns like this, we hope to appeal to specific market segments, such as university students and Canadians that speak a third language.

383 While information about our packages is made available in these ways, all of our TV customers must visit a store or contact our CSRs to finalize their viewing choices. Rogers has always done business this way. We want consumers to speak to us before they place an order so that we can take them through a needs assessment and provide them with the best value possible based on their viewing preferences.

384 Before we launched Starter and the new theme packs in March, we initiated the largest ever CSR training program in Rogers' history with almost 7,000 employees taking part. Each has been armed with the knowledge and tools required to help prospective and existing customers choose the best TV package for them and get the services they want at the best price.

385 We even developed a specific tool for our CSRs that allows them to compare the selection of our Starter service and theme packs with our existing packages. In doing so, our CSRs are empowered to help customers choose their best packaging option and thereby avoid any negative consequences associated with that decision.

386 Melani?

387 MS. GRIFFITH: While the new flexible packaging choices have been welcomed by thousands of customers since their launch in March, most continue to subscribe to our larger packages. Many choose these packages because of the array of channels they receive and the value inherent in the volume discount model. Others sign up for two or three product bundling offers, which provide them with discounts off their set‑top box and the combined price, as well as access to additional benefits.

388 At the end of -- at one end of the spectrum, these benefits include free VOD and TV Everywhere, and at the other end, they include services such as NHL Centre Ice and Texture.

389 At Rogers, we have traditionally relied on rewarding customers who acquire more and higher value services from us, and who enter into agreements that have a two‑year term. We believe it simply makes good business sense to attract new customers and to retain existing customers by rewarding those who buy multiple services from us. This is no different than an airline loyalty program. The more you fly, the more you are rewarded.

390 Since the launch of our Starter package and new theme packs, we have been listening to our customers and paying attention to what is going on in the marketplace. We have learned a lot over the past six months and have made changes.

391 For example, we decided to stop selling our first-tier offering. We now use Starter as the entry-level service for every new Rogers customer.

392 We have also revamped our larger pre‑assembled packages. Just last month, we launched three new value packages called Select, Popular, and Premier. Each differs in size and cost, but they all include Starter and a set group of channels. In addition, every customer has the ability to choose an extra channel to include in the package at no additional cost.

393 Customers who subscribe to one of these three value packages also qualify for additional benefits and bundling discounts. The value packages have replaced the larger pre‑assembled packages we have offered for many years. However, we have grandfathered our existing customers so that no one is required to switch to the new offerings if they don't want to.

394 Another example of a change we have made is to ensure that all customers can access channels in every format that we provide. Initially, it was only SD and HD formats that were available to Starter customers. We recently undertook the technically very complicated task of including the 4K content.

395 Similarly, we changed our original plans for packaging sports services and introduced, at launch, a special combo price. When customers subscribe to both the Sportsnet Plus and TSN sports theme packages, they benefit from a 30‑percent discount.

396 We are also changing our approach to bundling discounts. After hearing from consumers, we have decided to extend a product and hardware discount to Starter customers. Beginning in the first quarter of next year, all Starter customers will be eligible for these discounts when they buy a three-product bundle from Rogers.

397 The precise amount of the savings has yet to be determined, but it will be consistent with other bundling discounts available to Rogers' customers today.

398 In addition to these recent innovations, by December 1st of this year, Rogers will make all discretionary services available on a standalone basis. We are presently finalizing our full a la carte retail pricing.

399 While our pricing plans are commercially sensitive, we can confirm that we are designing and rolling out a second training course for our entire frontline staff prior to the launch of the new offerings. Similar to our treatment of the current Starter and new theme packs, all of the standalone prices will be clearly outlined on our website, and we will use a number of promotional vehicles to ensure that consumers are aware of these new options.

400 And there is still more to come. The imminent launch of our new IPTV platform will provide our customers with many more offerings, packages and price-points for them to choose from.

401 MR. WATT: Our experience with the new flexible packaging has been positive. We know, however, that some consumers have expressed concerns about the industry's small basic service and flexible packaging options. The Commission has received close to 1,400 complaints in total for all BDUs. Disaggregated information was not provided; however, Rogers has received 46 complaints, seven of which were forwarded to us by the Commission.

402 Many of those who expressed concerns regarding the new options identified issues that are not actually relevant to this licence renewal proceeding. For example, some consumers want the ability to choose only the channels they want to receive and avoid taking the pre‑selected channels in the basic service altogether. With respect, these are policy matters that have already been decided by the Commission.

403 The launch of Starter and new theme packs has been a major project for our company involving significant resources and costs. We are proud of how we have expanded the choices for consumers. The lessons we have learned will continue to inform our approach to consumer choice and flexible packaging.

404 Mr. Chairman and Commissioners, we are not done yet. There is plenty more to come as we continue to build on the flexible packaging options we experimented with in London nearly five years ago.

405 After the Choice Policy was announced, we embraced and worked diligently to introduce the Starter basic service and small theme packages within an extremely short timeframe. While we have only received 46 complaints, we have listened to our customers and learned along the way. In an effort to make our offerings even more consumer-friendly, we have committed to launching a Starter bundle in the first quarter of 2017.

406 We are proud of the job we have done for the benefit of our customers, and we look forward to offering full standalone options by December 1st.

407 We would be pleased to respond to any questions you might have.

408 THE CHAIRPERSON: Thank you very much and Commissioner Simpson will start us off.

409 COMMISSIONER SIMPSON: Thank you very much. Well, I don't know where to start now. You've just taken all the air out of my balloon.

410 I'm a big fan of the Montreal band Simple Plan and one of their big hits was called "Perfect" but it reminded me that even simple plans are not perfect.

411 I think going into this hearing when I was doing my prep I was asking myself, you know, why are we here? And from the position I am going to take this morning, it has a lot to do with trying to understand where the bottom or where the top is.

412 You know, the idea behind a small basic service was driven not only by choice but by economics. You know, we wanted to make sure that choice was not only to access to programming but also choice in terms of cost to the household.

413 And as we go through this hearing for the next two days my interest is really preoccupied with do we have a communication problem or do we have a product that has already reached its maximum with respect to satisfying the price conditions of those households out in Canada that can't afford anything but a small basic service.

414 And as we look at the cast of characters, we also look at the rigour or the enthusiasm or the creativity that each of the companies has applied to their approach to small basic. And I think it would not be inappropriate to say that, you know, that you've -- the needle is pointing in the right direction with Rogers which I think is great.

415 So with that said, I'd like to first start my line of questioning by going back to perhaps your wheelhouse, Ms. Griffith, which is when you were presented with the prospect of the small basic service, understanding how a multiple product, multiple service company like Rogers operates, how did you try and skin the cat on this?

416 Did you look at it as a road to nowhere or did you look at this as a gateway opportunity for new clients or retention of similar clients?

417 You know, what was the mindset that you went into, knowing that you had to make this work somehow?

418 MS. GRIFFITH: Thank you. I keep forgetting to do that.

419 I actually joined Rogers in January of 2016 so the train had actually already started at the great guidance of John Medline, so I'll have him augment my answer because I think he'll have more to add.

420 So I started in January, 90 days before the launch, and I know that from day one it was clear that this was a huge, huge priority for the company. This was a -- probably the farthest-reaching project our company has done in, I don't know, the last 10 years in terms of touching every single business unit from IT to network.

421 And the approach for us was really that this was a continuum of efforts we had started back in the London trial five years ago. What we've done -- you know we came together as a company and we really introduced this product. We learned immediately from it and, as you know, have already started to make some changes.

422 I think probably one of the most important things, to answer your question, is really about how we introduced our new value packages and how we have woven in the starter and those same packages into them.

423 We, like Videotron, are very much about simplification. And you're right. It's not always perfect. But we do our best.

424 And we felt that having starter be the foundation for all of our value packages and then the ability to weave in the theme packs and then eventually the a la carte services really shows sort of how we have been focused on that choice offering and that choice, the flexibility to our customers.

425 So I think we had that mindset going in and we have evolved with it as we've learned. We are six months in, which in my opinion is actually fairly new for a product, to be honest with you. But I think we have really made some big jumps as a result of that and based on some really good learnings. And I think that that -- you'll continue to see that through these new value packages and then on to our a la carte offering and even into our IPT product.

426 MS. DINSMORE: And if I can just add to that, just to make clear we view the starter package as, you know, the maximum package that we can provide. We chose to add the 4+1s and that was very important for Rogers as you will remember. And we don't charge extra for the access to the HD signals. That's all part of the -- part of the basic service. We provide access to video-on-demand which of course costs us some money; pay per view which you have spoken about.

427 But we didn't -- we didn't want to, you know, do anything that would constrain that offering. We wanted to make it as big as it could be under the regulations. So we view it as a very viable option.

428 COMMISSIONER SIMPSON: Thanks, Pam.

429 Mr. Watt, you referenced you know what we've learned -- what you learned in the London trial. With respect to, first of all, the approach to bundling, when your company looked at putting value bundles together for the starter package subscribers, did you build those packages from the bottom up or did you have to take existing affiliation agreements and water them down?

430 How did -- what was your approach and what difficulties did you have in putting these bundles together to make them work economically?

431 MR. WATT: I'm actually going to ask Melanie to address that question.

432 COMMISSIONER SIMPSON: Right.

433 MR. WATT: She had to -- she's the person who was working with the program providers.

434 MS. GRIFFITH: Right.

435 So we took a multipronged approach in terms of putting together those value packages. You are talking about the new value packages? Right.

436 So we took a multipronged approach. We looked at -- of course we looked at our agreements because those dictate a lot about what we can and cannot do, as well as the financial impact of those. We had done a great deal of research previously to understand what consumers wanted to see and what was important to them.

437 And we used all of those learnings to put together these -- to put together the packages that we thought made the most sense. In addition to then adding this construct of having the right to add one more no additional cost, that idea of there's even more flexibility and that you can -- you can sort of take one from a group of channels and add them in.

438 So we used all of that comprehensive learning research and the deals themselves to give us guidance. We didn't let the deals dictate us. In some cases, we went back and did some negotiating as is always required. But we put these together based on what we thought the customers wanted.

439 COMMISSIONER SIMPSON: But when it comes to the negotiation ---

440 MS. GRIFFITH: M'hm.

441 COMMISSIONER SIMPSON: --- I'm going to go into two directions here with -- staying with the first question which is building these value packages, were there services that just completely knocked themselves out of the possibilities of being included because of difficulties in negotiation or pricing that just made them unavailable to be able to add into?

442 I'm trying to understand the enthusiasm from the program providers toward the difficulty you had in putting these packages together and whether, you know, they were cooperating with it or they just knocked themselves out.

443 MS. GRIFFITH: Well, I think they were very cooperative. You know, this is a partnership; right? Without us there is no way that their signals get into the customer's home and without them, we're just a dumb pipe. So it's really a partnership together, and that's how we approached those negotiations and those discussions. It's still at its essence a negotiation over money.

444 COMMISSIONER SIMPSON: Yeah.

445 MS. GRIFFITH: But there was a desire on their part, as it was on ours, to put together the best packages for our customers.

446 So I wouldn't say anybody knocked themselves out of the park. I just think that there was, you know, the healthy discussion around what was the right -- what were the right economics.

447 COMMISSIONER SIMPSON: So going to the second part of my question with respect to those same providers, when you offer discounts for volume, you know, are you looking at -- I'll try and stay away from acronyms because this is a hearing being listened to by a lot of people outside of the Bell wave, but you know the average revenue per user, when you look at someone's qualification for discounts, particularly on packages, is that coming right off of your bottom line or do you cascade that back into the supplier cost, both on the equipment and the service provisions?

448 So if you are offering a bundle that is rewarding overall productivity to that customer, you know, are you sharing those discounts? Actually that's not -- the wrong word. Are those discounts being distributed through all your cost standards or is it coming right off of your pocket?

449 MR. WATT: Those dollars come from our economics so there is not a -- when we offer a discount, whether it be a promotional discount or one tied to a term, that comes -- that does not certainly to my understanding, that's not reflected in the contracts with -- either from the providers or content providers.

450 Now having said that, if you go way back to the launch of some of the services say in the mid-nineties, there were cooperative efforts in terms of trial periods and joint advertising campaigns, but normal course business those are decisions that we have undertaken as a company. We don't actually speak with them and we're planning on offering a particular discount. Those discounts, the economics are ours and ours alone.

451 COMMISSIONER SIMPSON: So an agreement is an agreement and it’s in stone until it’s renewed. So how then did you, again, once more with feeling, approach this unique problem of having to try and put starter bundles together based on these existing agreements?

452 MS. GRIFFITH: Well, you guys really helped us with that actually because by virtue of the fact that you -- we needed to put together these theme packages and ultimately the à la carte pricing.

453 All of our agreements say that we have to comply with, you know, local and -- local laws. So we were able to turn to our programmers and say “Guys, this is a requirement coming back from the CRTC.”

454 So, in essence, you all helped us crack open those agreements and discuss them such that we could get the flexibility that we needed to comply with the theme packages and with à la carte. So I think our friends that Videotron mentioned some of those negotiations, particularly for à la carte are ongoing today. But the programmers understand that that’s a requirement of us from the regulatory regime and so they need to come and work with us on that, and they have.

455 COMMISSIONER SIMPSON: That’s really helpful. Thank you.

456 So going into end of 2016 and into December, and when we get into pick and pay, can you open your kimono a little bit and let me know what those agreements look like with respect to à la carte services, so what they lose?

457 I guess I’m trying to figure out that if they lose something in the swings they make it up in the merry-go-round with respect to the standalone pricing.

458 MS. GRIFFITH: Yeah, I mean, the essence of the penetration based rate card that they are in many ways protected by what their -- so that they -- you know, if there’s more flexibility but they have some protection in terms of their revenue stream.

459 COMMISSIONER SIMPSON: M’hm.

460 MS. GRIFFITH: We’re certainly happy to share some information with you confidentially ---

461 COMMISSIONER SIMPSON: Thank you.

462 MS. GRIFFITH: --- for those. And I think what you’re looking for is some of the economics which we can speak to.

463 COMMISSIONER SIMPSON: Yeah, exactly.

464 MS. GRIFFITH: M’hm.

465 COMMISSIONER SIMPSON: I was just going to ask that question.

466 MS. GRIFFITH: Yeah.

467 COMMISSIONER SIMPSON: But you had ---

468 THE CHAIRPERSON: Sorry, Commissioner Simpson.

469 But you could do that by the same timeframe we talked earlier or is that too difficult?

470 MS. GRIFFITH: You could probably give some -- go ahead.

471 MS. DINSMORE: If I could just add, all the ---

472 THE CHAIRPERSON: Your mic please.

473 MS. GRIFFITH: You’re not on mic.

474 MS. DINSMORE: All of our current agreements are filed with the CRTC with the programmers, so we’re happy to provide any additional information, but I think anything that’s been agreed we -- on a regular basis are filing with the CRTC.

475 COMMISSIONER SIMPSON: Yeah, what I was hoping for was not the granularity of the individual agreements. I know those have been filed. But it was more to do with your opening statements where you seem to have indicated that you pretty much have the path built for 2017, and if there’s anything that hadn’t been filed in confidentiality that it would give us a better idea of how you’re approaching the next phase of this project of ours. If there’s anything you can share without violation or concern over trade secrets I’d be very interested in seeing it in terms of how you’re approaching the à la carte side of things.

476 MS. GRIFFITH: Quick clarifying question. For the approach, are you looking for general pricing, how we’re going to make it available?

477 COMMISSIONER SIMPSON: I think a broad understanding of how you’re approaching December forward based on what we’ve learned this year and how you’re -- are you going to be doing any adjustments to the existing programs that have been getting through to ’16; will there be adjustments or the need to repackage some of your basic service or basic small bundles; do you have to reprice equipment; you know, what’s going to be the next adjustment that you’ll have to live with for the foreseeable future.

478 MS. GRIFFITH: So I think between now and the end of the year what you would see really I think we’re very settled on what you see now today is what will be there, sir. I think the biggest change will be the inclusion of the à la carte channels. So for the -- we have about 200 channels that are à la carte today. We’ll be adding another 200. That will be by December 1^st.

479 So probably what we would share with you is simply the list of the 200 channels that will then be available à la carte. We don’t have all of the pricing set yet because we’re still ---

480 COMMISSIONER SIMPSON: Understand.

481 MS. GRIFFITH: --- in the throes of some of those discussions. They tend to take right up to the edge sometimes.

482 And so we -- you know, but that’s really the newest that you’ll see through the end of this year. And then next year of course we’ll be introducing a new bundle discount for starter which we can share with you beginning of next year when we have those details.

483 COMMISSIONER SIMPSON: And this would be available by the ---

484 MS. GRIFFITH: Beginning of next year, yeah, the bundle.

485 COMMISSIONER SIMPSON: No, in terms of your undertaking. This would be available to us by Friday 5:00 o’clock?

486 MS. GRIFFITH: Yes. I mean, I think there’s not much more to share other than the list of the channels that will be available à la carte and some of the general information about what the pricing will be in the range similar to I think what our friends at Videotron had spoken about.

487 COMMISSIONER SIMPSON: Okay. And you undertake to keep that undertaking updated ---

488 MS. GRIFFITH: Of course.

489 COMMISSIONER SIMPSON: --- throughout the process, because information ---

490 MS. GRIFFITH: Yes.

491 COMMISSIONER SIMPSON: --- will change over the next 120 days; correct?

492 MS. GRIFFITH: Absolutely it will, and we absolutely will.

493 UNDERTAKING

494 COMMISSIONER SIMPSON: Thank you.

495 Going back to product design and reaction to the small basic, it’s been the subject of much discussion that there hasn’t been really a fulsome effort by some BDUs to the promotion of the existence of this service, and it comes in varying degrees and descriptions, but I was wondering if you could, without critiquing the actions of your competitors, give me a better sense again of how Rogers decided that it was going to both build and market the small basic service and how this product fulfilled your best practices as a company without -- in other words, so that you didn’t aim low and fall below the standards of how you approached your customers on an overall basis?

496 MR. MEDLINE: Sure, I can speak to both the building part and the promotional part.

497 As you know, starters is largely prescripted, so the design of the starter package, although we’ve of course included the four plus ones that we’ve discussed in the in-chief, so the design -- that’s the way that was designed. The theme packs however that were on top of that were designed very carefully through research in both the composition and the pricing.

498 As far as promotion goes, the approach that Rogers did, I mean, we were pretty out there with what the plan was, so if you went to -- when we launched this on March 1^st it had pride of place on the TV landing page on rogers.com, which is the corporate website, right there with the cost of starter and the theme packs our outlaid there and the cost of equipment. We also put a bunch of customer facing frequently asked questions on there and they live there today, and we did community forums. In fact, if you go to the website now you’ll see four community forums that we did, including some of which we hosted to answer questions from customers. So there was a social component, a website component.

499 A little bit after we launched we’ve done -- and this was mentioned in the opening remarks, but we did direct mail to customers that either don’t have a TV product or that we believe may be interested in the starter concept. A great example of course is the multicultural where the larger basic package that we’ve offered for many years is maybe too big for certain individuals or households that don’t speak a lot of English or French so we’ve targeted through direct mail.

500 And of course, you know, a lot of press. We’ve actually proactively reached out to -- and reactively reached out to the press on this issue well before March 1^st and we’re continuing of course today.

501 COMMISSIONER SIMPSON: Thanks.

502 You said that you reached out -- you were doing consumer -- discussion with consumer groups. Were you hearing anything that is inconsistent with the research findings from PIAC? Did you find that you were hearing the same things from customers? Were you hearing them in different percentages? Was there anything new that you learned that the PIAC research didn’t uncover?

503 MR. WATT: Just to be clear, the research we were referring to was research with the consumers as to the best packaging collection of channels within a particular theme pack and various, you know, pricing scenarios as well.

504 PIAC was certainly the proponents of their research and received more press have to do with issues with the rolling out of the service. So they’re really two different types of research I believe.

505 So certainly we constructed our packages, based on our research. As we said in our opening remarks, we have modified some of the things that we planned on doing and, as we indicated today, we’re going to be modifying further with respect to bundles.

506 COMMISSIONER SIMPSON: Okay, thanks, and I understand that distinction and I appreciate it.

507 One of the things that you did take exception to with the PIAC research was the sample base of those who were highly dissatisfied with their pursuit of more information. And I think the numbers we were looking at in the PIAC -- or the research that was done was around a 4,100 sample base, but in that particular section there was something like 300.

508 So understanding the math of a 300 sample and how it can skew the pluses and minuses and all that, do you think that the reason why that percentage or that number was so low is because of the awareness was low as it seems to be with the existence of small basic so therefore if there was better awareness that figure might have been higher, or would it have stayed the same?

509 MR. MEDLINE: I’m happy to start and then pass it off to the panel.

510 But you’re right -- first off, you’re right; the PIAC sample, though there were 300 that was from all the BDUs, so the Rogers portion of the PIAC was 54 customers. That’s a really, really small sample size. I mean, the difference when I did the math, you know, the difference of moving to an industry average for us in awareness from their very own study was, you know, a difference of seven or eight people. That’s how small that sample size was.

511 But beyond that, I think the results a little bit are kind of disproving the fact that people aren’t aware of it. We have grown -- it said in the opening remarks but we have grown the base of our starter customers, with and without theme packs, every single week. And those are new customers that were never with Rogers, or not with Rogers TV prior, and also existing customers that are choosing this package. So I think the awareness is very good out there, at least for our footprint.

512 I also think that we spent a lot of time -- we didn’t talk about this in a previous answer but we spent a lot of time on the training side, an extraordinary amount of resources and time on the training the 7,000-plus frontline staff. Not just -- by the way, not just on the phones, but also in -- the ones who do internet chats with customers, and also retail stores in our cable footprint. So it was an extraordinary -- so it’s not just the frontend awareness, it’s the backend when they call in with questions, so...

513 MS. DINSMORE: And I would just add to that, that, you know, there are two sort of main lessons we learned out of our London trial; and, granted, it was five years ago but I think it’s relevant to this conversation.

514 One of the lessons we learned was that this product that we had in market was very attractive to those who are not currently cable customers. So that group definitely was a sweet spot for that trial.

515 The other thing we learned is that it wasn’t particularly attractive to those who had preassembled packages. So there was obviously those who were currently taking larger packages when they looked at what was available chose to stay with what they had, and we were surprised by that at the time but I think it might also help to speak to what we’re seeing out there in the PIAC survey.

516 COMMISSIONER SIMPSON: On that learning experience that you referred to, Mr. Watt, over the last year, did you have to do any price adjustments to any of the additional costs that came over and above the small basic cost? Did you have to do any repricing on equipment or installation fees or anything that may have been grandfathered prior to the introduction of small basic?

517 MS. GRIFFITH: I think the one pricing adjustment we did make was right at the beginning, right after launch where we, recognizing the marketplace for some of our theme packs to put them in a combination and then offer them at a discount. I think that’s the one that we -- that’s probably the biggest, the best example. Otherwise, not.

518 MR. WATT: I think the only other example is we offer our set top box at -- I think it’s $5.49 for starter customers. For other customers the price is 8...?

519 MS. GRIFFITH: Eight dollars and forty-nine cents ($8.49) so it’s $3 higher than it is for the starter customers. So that boxing -- they have a box discount that came about after we launched start up.

520 MR. WATT: Right. So we recognized that this is the very entry package and those people get a slightly lower price on the SD box. So really the SD box isn’t -- and Melani can speak to this -- something that we see as persisting into the future for a long time but at the current time we do have some of these boxes and they are being made available.

521 MS. GRIFFITH: I think speaking to the future, less a price change but a platform change that we have recently added the 4K function -- 4K version of the channels at no additional cost to our starter customers, which we had not originally.

522 COMMISSIONER SIMPSON: Okay.

523 MS. GRIFFITH: But I categorize that as a change as well.

524 COMMISSIONER SIMPSON: I was very happy to hear, Ms. Dinsmore, you reference that you identified that from your London trials, and I presume from this last year that a starter pricing package like this is a gateway to new customers.

525 The question I’ve got here is with respect to the technology of getting on board as a cable customer. Sorry; I’m getting translation bouncing back and forth here and it’s distracting.

526 Anyway, so my question is; is technology -- you referenced platforms earlier. Is technology bringing the price of HD boxes down? Is there a starter box that’s -- that’s different and perhaps less features that could be looked at or is available out in the marketplace that could help starters -- starter subscribers?

527 MS. GRIFFITH: So we really think about the HD box as our main box, right? I mean the vast, vast majority of our customers operate in an HD world; they have HD television sets, they expect to have an HD box. That’s the box we talk about; that’s the box we market. And we are, of course, as you know, very much talking about our 4K functionality as well as the next -- you know, the next version in the evolution.

528 SD boxes is -- the SD box to us is really that simpler, perhaps less feature -- and by feature, I really mean that it doesn’t have the picture quality that the HD box does. So it doesn’t -- it’s a simpler, I think less rich in terms of the picture than the HD is. And it -- thus we’ve kept it at a lower price specifically for our starter customers to recognize their sensitivity on cost.

529 We do require customers to take one SD box; however, if they have additional television sets and they want another option we do have the DTA, which is the digital transcoder adapter.

530 COMMISSIONER SIMPSON: M’hm.

531 MS. GRIFFITH: And the DTA really is -- it’s not even a box. It’s actually truly an adaptor that enables a television set that is an analogue television set to receive digital signals, turn them -- or receive an analogue signal and turn them into digital such that the TV can -- the person watching the TV can actually see it. I think I flipped that. Receive the digital signal, and makes the TV make it available to analogue. Forgive me.

532 COMMISSIONER SIMPSON: M’hm.

533 MS. GRIFFITH: So that’s a -- and that’s $3. So it doesn’t have any other features. It doesn’t allow you to have VOD, access to pay-per-view. And, importantly for starter, it doesn’t allow you to add any theme packages or à la carte which is why it’s so important that you at least have one standard definition box which allows you to do those things. And then if you have guest rooms -- TVs in the guest room or TVs in the kitchen that are analogue, we provide an option for you. So really between those two we think those are very -- those are excellent low-cost options for our starter customers. And then, of course, if they still want the HD experience or the 4K experience, we make those available as well.

534 COMMISSIONER SIMPSON: Okay. On the -- I believe it was in your submission that you indicated that you charge for additional drops within the house. Is that correct?

535 MS. GRIFFITH: Yes, we ---

536 COMMISSIONER SIMPSON: I think it was seven bucks or five bucks or something like that.

537 MS. GRIFFITH: Yeah, 7.49.

538 COMMISSIONER SIMPSON: Why?

539 MS. GRIFFITH: Seven forty-nine (7.49) for additional outlets.

540 COMMISSIONER SIMPSON: Is it because it’s a technological necessity that brings about cost to you or is it -- you know, do you need an extra box for every room? You know, I’m familiar with the stuff I’m using which is one box serves a household and I’m trying to understand why a charge per drop is necessary, other than for revenue purposes.

541 MS. GRIFFITH: Right. So on our system you do -- you are required to have a box or a DTA on every television set, that’s a technical requirement based on our system, and there’s a cost to us for the box. So we’re ---

542 COMMISSIONER SIMPSON: So that’s what the cost is.

543 MS. GRIFFITH: So the cost is simply because the box is costing us money.

544 COMMISSIONER SIMPSON: So it’s the box cost.

545 MS. GRIFFITH: Correct.

546 COMMISSIONER SIMPSON: Okay, great. Perfect.

547 Going back to, again, the gateway question and the fact that you have looked at this as a way to also migrate non-television product customers into your television ecosystem other products like wireless have long-term contracts. Is there anything that a long-term -- the existence of a long-term contract with a Starter customer could, if they were to enter into a long-term with you on a Starter package, open that gateway up even more to more discretionary services other than just what you're offering now because it's a more sticky relationship?

548 MS. GRIFFITH: Yes. I mean, we're still working through what the discount will be for these Starter -- for the bundled discount for these Starter customers. Certainly, they would continue to receive video on demand, access to pay‑per‑view, and the TV Everywhere streams and experience.

549 Part of our approach is about when, you know, the benefits of membership. So the more that, you know, the stickier relationship and the more you're getting from us, the more we want to give you -- to reward you.

550 COMMISSIONER SIMPSON: I like that word "membership".

551 MS. GRIFFITH: Right. Yes, exactly. So ----

552 COMMISSIONER SIMPSON: That's a good word.

553 MS. GRIFFITH: Right, so ---

554 COMMISSIONER SIMPSON: More seasoned.

555 MS. GRIFFITH: --- you know, with our packages today, our multi party packages today, as you move up, in terms of what you're purchasing from us, there is more benefit.

556 And I think it's important to recognize that we also -- you know, it's a cost to us, right, that the products that we offer, Texture, Game Centre Live, and such, are not free. You know, I'm paying programmers for that cost, but I want to give that to my customers as the benefit of being a member and purchasing from us.

557 However, there are on an ongoing basis a lot of content discounts that will be available, and are available today to our Starter customers. So a great example would be TMN. We offer two months free or four months at 50‑percent off. We have discounts on Hollywood Suite, on Superchannel. So we do offer discounts to our Starter customers today, even not in a bundle, and we would be looking to do more of that type of things while -- when they're in a bundle.

558 MS. DINSMORE: And just to follow up Melani.

559 Equally, we only have term contracts in the context of a bundle. So a Starter only customers, TV only, we wouldn't have a contract in that relationship.

560 But within our Starter bundle that we're still working on, ultimately we would require a two‑year contract, as we did with all other bundles because that's part and parcel of getting a discount is the commitment to Rogers for a set time period. If that answers your question.

561 COMMISSIONER SIMPSON: It does, which is why I jumped in and said I liked the word "membership". I was trying to get a better sense for how you regard a long-term customer without the necessity of a contract per se.

562 You know, I fly a lot and I don't have a contract with Air Canada, but they know who I am and how often I fly. But it isn't always by the number of flights either; it's by the dollars that we spend. So I was trying to just get a better understanding of how universal or holistic you're approaching your customers.

563 And I think it leads me to my next question, which is although you're going to submit stuff regarding the year to come, could you give me at least a hint as to how you feel you're going to have sort of rejig or reorg all your product offerings when all of a sudden all this discretionary stuff is in the mix?

564 Because right now, your website, and again, I give you within my capacity, limited compliments on how you've put together your Starter package with growth avenues and products to do so, but all of a sudden the game changes, with pick and pay the curtain comes back.

565 And so how are you going to approach the Starter package with respect to the marketing of all the other products that potentially come with the mix now, or in December?

566 MS. GRIFFITH: I think there are two questions there. I'm going ---

567 COMMISSIONER SIMPSON: Yeah.

568 MS. GRIFFITH: --- do the first one.

569 COMMISSIONER SIMPSON: With my questions, there can be 10 in there.

570 MS. GRIFFITH: And I'll have 10 answers.

571 You're exactly right. It actually gets more complicated in many ways because of all of the choice. And so there's a very famous saying, "If I had had more time I would have written a shorter letter". I think that's Shakespeare.

572 But you -- and that's a little bit sort of what we are working towards. It takes a lot of effort to make something simple and to communicate it simply.

573 I like to tell this story: When I first joined in January, John handed me a 3‑inch binder with all of the information about everything I needed to know. And in it -- and I took -- I read it, and I took all these notes, and the very first note I took was, "Why do we have so many packages?. I can barely understand them and I'm running content." So if I can't understand it, I don't know how our frontline can understand, much less explain it to our CSRs.

574 So that's what caused us to undertake this effort to really simplify by introducing very clearly three packages, Select, Popular, Premiere, and the foundation of all of those is the Starter package, right. So you can take Starter alone, or it's part of every single one of those packages. And so that's what we like to talk about.

575 And then on top of that we say, no problem. If you want some additional -- you know, if you are really -- if you really like Select but you want a couple of, you know, you're, you know, a huge fan of Lifestyle and those channels aren't there, you can add that theme back on top, or in less than 12 weeks from now, you can just select a couple of key channels a la carte and add them in.

576 So for me, it's really about trying to weave the story together between here's our value packages, and then you can add theme packages or a la carte on top of that, and that really is a customized experience for you. And you can do it sort of as slimmed down, if you will, with just Starter, or as fat as, you know, Premiere with, you know, with everything on top of it.

577 So I think that's the story we're trying to tell and we're trying very hard to keep it, to the best of our ability, simple. And I think that where the rubber hits the road really is about the communication of that.

578 And we're doing our best, and I'll let John speak to you a little bit more about how we're communicating that, but the key is to try to keep it as simple as possible with all the different components, and that's what I think we've tried to do by marrying those two pieces.

579 MR. MEDLINE: And just to, again, to the promotion part.

580 So we'll be using all the vehicles that we used in, what I'll call the first phase, the March 1 phase of this project, and it is a project.

581 I think there's a few other vehicles that we can use, a bit of learning in the first phase. We can use a little bit more on our -- for our existing customers. We've got a Barker Channel, which is actually highly viewed. So we can use a few more vehicles on the promotional side, both for Starter proper but also for the new value packages that we've just recently introduced, which allow customers to layer on, again, the theme packs and the a la carte offerings when they're available.

582 And again, I know I harp on it a little bit but the back end is key here. So that second training for over 7,000 employees is really important for us and takes people away from the phones and from the retail stores and from the live chats to make sure that they understand, not just first phase again, it never hurts to reinforce, but also what's coming on the a la carte basis.

583 COMMISSIONER SIMPSON: Thank you.

584 There has been anecdotally some criticism that some companies had been training or instructing their CSRs to avoid talking or marketing a small basic at any cost. And I'm just wondering -- I'm playing a little game of Truth or Dare here -- have you ever instructed any of your CSRs in training to try and pivot away from a small basic offering, or have you been forthcoming?

585 MR. WATT: No, we are not that company, whoever they are. We have not provided direct into that effect.

586 I'll let Melani speak more. We do, as we say, as with all our video customers, require them to speak to our CSR, and our CSRs were fully trained. And I'll let Melani go through the principles of the conversation that we actually do have with them to ascertain their needs.

587 MR. MEDLINE: Yeah, so -- thanks Dave.

588 The -- part of the confusion, perhaps coming from -- no, of course, Dave is absolutely right. We didn't tell people never sell Starter. In fact, Starter is a very good option for low TV viewers, people we don't have today, and also again, for groups like first or second generation, third language speakers, whether it's Filipino or Tagalog speakers, or Urdu or what have you, it's actually a very good option for those customers.

589 Maybe part of the confusion, though, is that when we do have conversations with our customers, whether it's in the store, or on the phone, or on a live chat, right sizing is for the household, is a key part of that conversation. It really is a conversation. You meant -- in the earlier presentation there was talk of a script. This is really a conversation with a customer to understand what their household needs may be when it comes to -- when it comes to their television viewing choices.

590 So we do need to have that discussion to make sure that the customer if they have got kids in the household and sports fans that of course they can go starter plus theme packs, but it may not be the best value or the best value per channel that they are getting in the household.

591 So I think maybe some of that is leading to some of the confusion out there.

592 MS. GRIFFITH: And I am going to jump in too and say we start by saying to somebody when you call in, "What do you watch"; right?

593 Because outside of a room like this and the people that are experts here, if you ask regular people who are not cable experts, they don't talk about what package they have or even the channel. They talk about Game of Thrones or their favourite, you know, MasterChef episode or which hockey game they are watching tonight. They talk about content because content is fun. So that's what people want to talk about.

594 So we engage in a conversation where we ask, "What are you watching?" Because they don't necessarily remember that Walking Dead is on AMC or that Game of Thrones is on TMN. They just know that they love to see it and when can I watch Billions and everything else?

595 So we help just explain to them, okay, that's what you are watching. Now, how about the other members of your household? What are they watching?

596 I don't know about you guys, but as much as I love him, my husband and I do not watch the same shows. And thank goodness. I definitely don't watch the same shows as my children. But I need to make sure that we've got it all covered; right?

597 So that's where the conversation is incredibly helpful so that we can explain to them, okay, got it. We've got to take care of your husband, your two kids; your teenage daughter. Here is what we recommend and why.

598 That's the discussion that we have to help guide them. And if that starter is in that starter and if that's anything else then it's whatever else they need.

599 COMMISSIONER SIMPSON: Thank you.

600 In your -- I believe it was one of your letter to us answering some deficiency questions. You had mentioned that there were technical issues that prevented you from making some discretionary programs available and it -- you know, without getting into the IT side of things, you indicated those are going to be fixed. Are those going to be fixed in time for December?

601 MR. WATT: Yeah. That actually is a technical issue truthfully, here.

602 This is -- we have two fixes; in fact, because we have two different systems. So they should both be fixed by the end of this year.

603 Ontario fix uses different systems; should come first, hopefully this month. And it's only for a select number of channels with affected VOD and it's only on the -- on the set-top box version. Our "TV Everywhere" is fine in this respect.

604 The Atlantic provinces will also come hopefully, I’m really hoping, later this year.

605 COMMISSIONER SIMPSON: Okay, just cleaning up a few things.

606 One of the unintended consequences it seems of introduction of small basic was that certain services -- it's my impression that certain BDUs, some BDUs perhaps misinterpreted our direction or suggestion or anticipation regarding tide selling.

607 Where I am going here is it seems that some BDUs had not offered value added to the small basic package because they misinterpreted our concerns regarding tide selling. Do you think that we could have done a better job communicating that or do you think from an industry standpoint there is some confusion over our desire not to see a customer held hostage to having to buy a second product but that shouldn't stop that customer from being offered another product at a discount or at a value-added?

608 Did we do a good job or a bad job in communicating that?

609 MS. GRIFFITH: No, I think we ---

610 COMMISSIONER SIMPSON: Go ahead. Criticize ---

611 MS. GRIFFITH: No, I think we ---

612 COMMISSIONER SIMPSON: --- the Commission.

613 MS. GRIFFITH: --- no, I think we understood you because I don't think we've had that problem.

614 You know, we -- our video-on-demand and our "TV Everywhere" content is available. We didn't separate that out. People are more than welcome to buy other products from us if they want.

615 So I think actually we are quite clear. I don't think we had any misunderstanding about it at all. I think we're quizzical because we are -- we didn't have any questions, so we thought it was pretty straightforward.

616 COMMISSIONER SIMPSON: Yeah. I would have thought so too. But it didn't always seem to be that way.

617 But what I did find interesting is that it seems that a lot of the smaller, particularly the IPTV providers, didn't have that confusion either. One of the scenarios that are sort of running in my head was going back to provision of Internet or programming over Internet by a cable DOCSIS-type structure.

618 Do you think that -- how would you react if a small IPTV were to offer small basic as the value-added? In other words, buy my Internet service; get the TV for next to nothing. How would you compete with that?

619 MR. WATT: I'm not absolutely familiar with the way VMedia are actually offering the video service so I don't know as I speak whether they require you to take the Internet service in order to get their video service. But we would compete either way, whether they do it separately or require the other service. We would compete with our -- we would compete in the marketplace with our offers.

620 We would have both varieties. We have starter standalone and you have the ability to take other services as well. But you certainly have the ability with us to take starter standalone basis, no other requirements.

621 COMMISSIONER SIMPSON: M'hm.

622 MS. GRIFFITH: Actually, if I could add?

623 COMMISSIONER SIMPSON: Go ahead.

624 MS. GRIFFITH: We have a student offer in the market today. Actually, it's very specific, very targeted to students because we know they generally are more Internet-focused. It's at a discount today for the Internet and then if you choose to take starter but at the full $24.99, you get an additional discount on your Internet.

625 So that's, I think, perhaps a way that we are in a very specific, fairly surgical manner, trying to appeal to a market specifically that's sort of less focused on cable, frankly, because they are more Internet-oriented and they seem to like to get all their content by streaming. So we are hoping to incent them using our small basic service and discounting further their Internet in order for them to buy starter at the $24.00.

626 COMMISSIONER SIMPSON: Okay, the last question.

627 Going into December seemingly you're ahead of the curve and you've got everything pretty much ready to hit the go button.

628 Is your commitment to promotion of small basic, given what you said, Ms. Dinsmore, that you know you do recognize that as a gateway into customers, is your marketing activity on an index, is it going to be more or less or about the same with respect to promotion of the service going on?

629 MS. GRIFFITH: Well, it's already on an upward trajectory. What we did in the first couple of months is identify who is -- who it was appealing to. And now we have more recently gone out with some direct mail to specifically get to some of those customer segments.

630 As I mentioned with the student package we specifically, with school starting, used that as our back to school efforts and then, of course, as we start talking about our value packages more and more and how you have the ability to add theme packages and a la carte, I think you will see an upswing. That's our intention to talk about that flexibility and those choices.

631 COMMISSIONER SIMPSON: Thank you. Those are my questions.

632 THE CHAIRPERSON: Let me take you back to something you said on page 2 of your presentation. And I'll quote it back to you:

633 "While information about our packages is made available in these ways, all of our TV customers must visit a store or contact our CSRs to finalize their viewing choices."

634 From my experience being an Assistant Secretary of the Federal Treasury Board Secretariat and the various channels and the costs associated with contacting client base -- in the case of the Treasury Board Secretariat obviously they are not clients. They are citizens -- obviously, walk-in offices are the most expensive and the least expensive is probably more an online experience.

635 And also, having heard from Videotron earlier that you know their preference is, and it was my impression certainly at the CRTC we realize that the expectation of a lot of individuals, probably younger folks, is that they like to deal with an online avenue to look, make decisions and execute on them because they have other things to do than go into a store or wait in line or on to our telephone. They have busy lives and that's how they have learned to interact.

636 So I am a bit surprised that you have made that choice. Maybe you can tell me a little bit more because at first blush it looks a little paternalistic that you actually have to hold their hands for them to make a decision. They may actually know exactly what they want.

637 And on top of that, if they want to downgrade you've put a barrier to the number of channels. Like if they have a certain package and they want to go down, it's my understanding that your platform you can't do that, contrary to Videotron. Where somebody can, in your case, go up, but you can't go down a number of channels.

638 So explain to me why -- at first blush I would have thought it costs less to allow people to do -- make decisions from beginning to end online. It's a growing demand by younger demographics, and requiring them to do the extra effort of going to a store or contacting a CSR with what that entails, actually creates a barrier for them to make a choice and execute. They're grown people.

639 MS. GRIFFITH: For us, the ability to have the conversation with a customer to have that discussion about what do you like to watch, and who are all the people in your home, and how do we make sure that all the shows that they want to see are covered in what you're buying is really important to us. I don't see it as, you know, trying to tell them what to do or being paternalistic as much as I -- what we're trying to do is help them the first time.

640 Because what we have found, particularly with new products is that people have a lot of confusion. This is a brand new space. This is a brand new product. Something like this really hasn't been available for us, and we want the ability to just explain it to reduce the number of times they feel that they have to call back in.

641 We think that if you get on the phone and have that conversation or Facebook Messenger us, you can have a discussion and then order it on the phone, that's less frustrating than doing it online, figuring out that that's not what you wanted. And we have a large percentage of our customers that have actually taken Starter and then changed their mind and wanted to do something different.

642 And so what we're trying to do is sort of presumptively strike, if you will, and try to help them in terms of giving them the information that they're asking for out of the gate to make it an easier sort of one hit and not a continued, what I think would be much more frustrating experience, we have to continue to call back and make changes. So -- and that's really our -- has been our approach to all of our -- the orders for that.

643 And I'm going to ask John to speak a little bit further to that, and then to your question about the downgrading.

644 MR. MEDLINE: Sure.

645 The other thing to point out is it's not particular. In this respect, it's not particular to Starter customers.

646 MS. GRIFFITH: No.

647 MR. MEDLINE: This is our TV offering. So no matter which package, whether it's one of the new value packages, or in the past the old VIP packages or the big basic packages, you did have to talk to us.

648 It's -- I understand the question, and in fact, you know, at first blush wouldn't it be great to take cost out of the business. It would be in our best interest to do so.

649 These are complicated discussions too. Not only do we want to have a discussion with them, but it's a little bit complicated, so -- and by a little bit I mean a lot.

650 We have a number of campaigns and bundles, grandfather packages. Not one or two, but many, many customers are on different types of grandfather packages over the years. So when you go down a route like Starter, you need to know where you're moving from and to. So it's not quite as simple as putting a few things up there.

651 Again, the big point though is we treat all the -- to me at least, we treat all the customers in the same way for our TV product.

652 MS. GRIFFITH: And then -- oh, I'm sorry.

653 MR. WATT: I was just going to add that I certainly take your point about the costs, but I think Videotron was interesting to us because I heard a number I hadn't heard before.

654 They had been, as they said, they're ahead of the curve and since 2004 have had more of the smaller packages and choice, and I believe they said they were still -- 85‑percent of the interactions with customers was through the call centre. So that -- they're looking quizzical. I think that's what -- 80‑percent? I thought I heard 85.

655 In any event, go with 80‑percent. I think it's indicative of how complicated it is to move to the online, and obviously there's, you might call it inertia on the part of customers liking to speak to a person, but the fact is that it still remains the predominant way of interacting today.

656 THE CHAIRPERSON: That's why we have transcripts. We're going to check exactly what they said and that way we don't have to argue about it but -- and base ourselves on our memory.

657 But I take it from -- and I take your point that this is your policy across all product segments. So the question -- and you've made assumptions and -- or maybe you have tested it.

658 Have you done customer focus groups? Have you actually tested in a particular area, allowing greater direct access, and decision, and execution by customers on a digital platform, or is it such a policy that you have never made, even on a test basis, an exception?

659 MS. GRIFFITH: To my knowledge, we've never done it on a test basis. We're certainly having discussions all the time about how to be more active in a digital world.

660 I think Rogers, correct me if I'm wrong, was the first to do Facebook Messenger for -- as a customer service tool. So we are always being -- we're always thinking about it.

661 But this particular piece is for the television product, very important to us in terms of that conversation, but we're in an ongoing effort to be more digital.

662 THE CHAIRPERSON: Right.

663 I also took away from Videotron's presentation that the message is keep it simple, because the more complicated, and you've done echoes of that.

664 And I get you have some legacy packages out there for a lot of people, so if it's costing you grief making your communications more complicated why wouldn't you create incentives for people to, you know, go to a more, an easier package and make it worth their while, and that way you get rid of the legacy programs?

665 MS. GRIFFITH: That's -- you're exactly right, and that is what we're trying to do. We're trying to incent people to move out of some of our grandfather packages into our new packages.

666 Things like having the TV Everywhere, having the ability to add one more channel out of a pool at no additional cost to you. Those are the types of incentives, and you'll see along our continuing with the IPTV product, we're doing a lot of things to pull people into these new packages and to that new platform, 4K and all of that.

667 So we try very hard to maintain our grandfather packages. I think we have never shut down a grandfather package, because we don't want to be disruptive, frankly, but we're doing our best with apples and honey, rather than a stick, to get people to come over.

668 THE CHAIRPERSON: Right.

669 Of your total number of households, how many would that still be on a legacy offering as opposed to, you know, your current offerings? A percentage, roughly?

670 MS. GRIFFITH: So over 60‑percent, right?

671 MR. MEDLINE: Can I just ask for clarity on that? Are you -- Commissioner, are you talking about the legacy television or ---

672 THE CHAIRPERSON: Yes.

673 MR. MEDLINE: --- bundles?

674 THE CHAIRPERSON: Yeah, I'm talking about your television offering.

675 MR. MEDLINE: Oh, the -- let me try on this.

676 The -- you know, the legacy TV packages, that would be almost all. I mean, we've launched a number of new packages starting with Starter and the theme packages in March of this year, and then we've just rolled out the new Select, Popular, and Premiere, but that is so new. So nearly all of our customers, of our cable customers are on what we might call legacy TV packages.

677 THE CHAIRPERSON: I remember Mr. Engelhart of The Wireless Code telling me about the number of legacy offerings he had on the wireless side, because it will be hard to keep it simple if it's complicated unless you bring people around to that perspective. And I get the sense that's part of the frustration of the customer base. It's always so complicated.

678 MS. GRIFFITH: Agreed, and I think that what we're trying to do is only talk about our new packages. Right? So that we -- the new packaging is very -- we think quite simple. That was the effort we undertook from offering nine packages to offering just these three with the different choices about theme packages and a la carte on top of that. And that's what we talk about, and that's what we're speaking to our customers about, that's what we're promoting.

679 So we recognize the history of the grandfather but we simply do not think it's a good customer experience to just force everyone over into the new packages.

680 THE CHAIRPERSON: But without forcing, you can entice. You talked about honey ---

681 MS. GRIFFITH: Yeah.

682 THE CHAIRPERSON: --- and carrots rather than steaks. I mean, how much does a couple of free movies actually cost Rogers as a promotional guide, right, as a promotion item to get them to move away from ---

683 MS. GRIFFITH: Right.

684 THE CHAIRPERSON: --- you know, from a legacy heritage system that merely complicates your informatic system and your training of CSRs and all that?

685 I mean, I don't want to tell you how to run your business, but if you're telling me that that's the complexity, it seems like an obvious thing to focus on.

686 MS. GRIFFITH: Yes.

687 THE CHAIRPERSON: I see nodding heads. They don’t show up in the transcript.

688 MR. WATT: We agree and we -- as nodding has indicated, we’re looking carefully at it. You’re absolutely right; I forget the number, whether there’s 5,000 or 9,000 grandfathered plans in wireless but it was an outrageous number. Sadly, we’re still roughly at that number now. It is -- we do try to move people; we have some limited success. Eventually we bite the bullet on some of these. We shut down our analogue wireless system. Eventually. But even there it’s tough; the people had stuck the phone in the glove compartment and -- just as a safety phone, they are quite upset they couldn’t get a $12-plan any longer.

689 But we take your point and you’re absolutely right; we talk about making it simple but then we have all sorts of things that keep it absolutely complicated.

690 THE CHAIRPERSON: Okay, well, thank you.

691 Legal counsel?

692 MR. GAGNON: Thank you, Mr. Chairman. I just have a quick -- a few quick follow-up questions, if you don’t mind.

693 Firstly, on bundling discounts, just wanted to get some clarity on those; could you explain what the current strategy is for your small basic service subscribers?

694 MS. GRIFFITH: We’re going to bring that out in Q1 of 2017 so we’re still working on what the bundling strategy is. It will be a triple-play strategy for -- with starter in it, with our small basic in it, and it will include both content and a hardware discount. But we don’t have ---

695 MR. GAGNON: But there’s nothing at this point in time.

696 MS. GRIFFITH: No.

697 MR. GAGNON: And is it the same response for small package subscribers?

698 MS. GRIFFITH: I’m sorry, I don’t know.

699 MR. GAGNON: There’s no bundling discounts for those that subscribe to small packages?

700 MS. GRIFFITH: That, to us, is the same as the small basic.

701 MR. GAGNON: It’s the same.

702 MS. GRIFFITH: It’s the -- même chose. MR. GAGNON: Okay. Regarding pricing, we’re wondering whether there were any price adjustments to the small basic service or to flexible packaging options since the 1^st of March?

703 MS. GRIFFITH: As I’d mentioned earlier there was the one on the sports were combined; you could get it at a discount. That’s the only change that we made.

704 MR. MEDLINE: There is one more small change. We offered two distant signal packages; one Canadian and one U.S. When we launched, the U.S. was sold separately for $3 but right now we introduce -- that’s no longer available so you have to take the Canadian and U.S. distant signals together for $6.

705 MR. GAGNON: And any changes to the equipment fees or installation fees since the 1^st of March?

706 MS. GRIFFITH: Well, yeah -- do you want to take that, David?

707 MR. WATT: No change to the fee except that when a higher rate was applied to standard definition boxes to non-starter consumers we did not increase the price for starter consumers. So it’s not a price change, it’s -- other people suffered a price change but these customers did not.

708 MR. GAGNON: Any planned change from now until the 1^st of December or...?

709 MS. GRIFFITH: No.

710 MR. GAGNON: I have a couple of questions on pick and pay. We’re wondering if all standalone services will be available to all customers, regardless of what packages they choose?

711 MS. GRIFFITH: As of December 1^st, yes. So customers will be able to have access to channels -- all customers will have access to channels two ways, which is either through a theme pack or à la carte, pick and pay, and -- or also through a value package.

712 MR. GAGNON: And will there be any bundling restrictions with respect to those subscribers, à la carte subscribers?

713 MS. GRIFFITH: No.

714 MR. GAGNON: I’d just ---

715 MS. GRIFFITH: Well, the new -- right.

716 MR. GAGNON: Okay. I’d just like to go through the undertakings because I guess the intent here is to require the same undertakings that Videotron had previously. So the undertakings would include if Rogers has any CSR training documents, information documents that are used internally for the offering of the skinny basic service and flexible packaging.

717 MS. GRIFFITH: Yeah.

718 UNDERTAKING

719 MR. GAGNON: The second undertaking is with respect to the strategy with -- towards the implementation of pick and pay. I think that was addressed earlier ---

720 MS. GRIFFITH: Yes.

721 MR. WATT: Yes.

722 MR. GAGNON: --- but we’re seeking details of any promotion or wholesale prices of the channels, bundling discounts.

723 MR. MEDLINE: Sorry; wholesale prices or retail prices of the channels?

724 MR. GAGNON: I think we do -- well, the retail was required, yes.

725 MR. WATT: Yes, I think it is retail.

726 UNDERTAKING

727 MR. GAGNON: And the last thing is just to confirm that Rogers will keep the Commission informed of any other ---

728 MR. WATT: Yes, we will.

729 MR. GAGNON: --- changes up until 1^st of December.

730 UNDERTAKING

731 MS. GRIFFITH: The only thing I would augment on the video pricing is that similar to Videotron it’ll be a range. We’re still in discussions so not all of them are set.

732 MR. GAGNON: Okay. Thank you.

733 THE CHAIRPERSON: Yes, and you’re certainly welcome to add the caveats you need on that. We know it’s a working document that will evolve between now and whenever your launch is.

734 I reiterate; you don’t have to do it till the first -- at the very last moment. You could actually get ahead in the marketplace.

735 MR. GAGNON: One last thing ---

736 THE CHAIRPERSON: Yes.

737 MR. GAGNON: --- Mr. Chair.

738 THE CHAIRPERSON: Yes.

739 MR. GAGNON: With respect to confidentiality; if, of course, you’re requesting confidentiality, please, please justify it and provide an abridged version for the record.

740 UNDERTAKING

741 MS. DINSMORE: Okay.

742 MR. GAGNON: Thank you.

743 THE CHAIRPERSON: I think those are our questions, so thank you very much.

744 It doesn’t seem reasonable at this point to start with a new intervention so why don’t we take a break till 1 o’clock and we’ll keep going with the next intervenor, with Shaw Cable System and Star Choice.

745 So thank you very much. Thank you.

--- Upon recessing at 11:43 a.m.

--- Upon resuming at 1:00 p.m.

746 LE PRÉSIDENT: À l’ordre, s'il vous plaît.

747 Madame la secrétaire.

748 THE SECRETARY: Thank you, Mr. Chairman.

749 We will now proceed with Item 3 on the agenda and the presentation by Shaw Cable Systems Limited, Shaw Cable Systems VCI Limited, and Star Choice Television Network Incorporated.

750 Please introduce yourself and your colleagues and you will then have 20 minutes to make your presentation.

751 Thank you.

752 MR. MEHR: Great, thank you.

PRESENTATION

753 MR. MEHR: Good afternoon Mr. Chairman and Commissioners. My name is Jay Mehr and I’m the President of Shaw Communications.

754 I’m joined today by Peter Johnson, Executive Vice President and Chief Legal and Regulatory Officer; Sanae Takahashi, Vice President, Product and Analytics; Katherine Emberly, Vice President, Marketing; Sarah Miller Wright, Vice President, Customer Care; and Dean Shaikh, Vice President of Regulatory Affairs.

755

756 When the series of Let's Talk TV decisions were announced last year, we expressed our strong support for the Choice Policy. Consistent with Shaw's recommendations, the policy provided a balanced and orderly framework that will maximize choice for Canadians.

757 We are approaching this proceeding with the same spirit of collaboration that guided Shaw's participation throughout the Let's Talk TV proceedings.

758 We view this hearing as an opportunity to further support the Choice Policy as providing the right balance between regulatory protections and market-based flexibility; explain our approach to the implementation of flexible packages and Limited TV, which is our entry-level basic; and address questions regarding bundling, promotion, customer care and packaging.

759 No one can deny that today, more than ever, customers are in control of their programming choices. Given the intense multi-platform competition among licensed and unlicensed players both the regulatory framework and business models must evolve to reflect the power and demands of Canadian consumers. The Let's Talk TV decisions recognize this reality. Because of Shaw's dedication to putting first the needs of our customers, we are aligned with the objectives and directions of the Choice Policy.

760 For that reason, we have fully embraced Limited TV, small packages, and pick and pay as part of our overall business strategy to win customer loyalty and to relentlessly focus on maximizing the customer experience. Shaw was the first large BDU to launch its small basic service on February 16^th, and we now have approximately 85,000 Limited TV customers, including almost 70,000 Shaw Cable customers.

761 This high penetration demonstrates that the Choice Policy has provided a strong foundation for Shaw to increase choice and value. Small basic and the new flexible packaging requirements are part of our evolution to better serving our customers; but only one part. We’re continuing to invest, innovate, and create new content experiences for Canadians.

762 At our last hearing in April, we committed to a leadership role, as we described our efforts to build and maintain powerful and reliable networks, and offer choice and innovative services at a reasonable price.

763 This commitment was clearly demonstrated when we launched Wide Open Internet 150 in July. This is one of Shaw's most exciting and most important product launches in our history. We have provided our customers, including Limited TV customers, with the speed they want at a price they can afford.

764 Limited TV customers also have access to live content on Free Range TV, so they can watch what they want, at home or on the go, on the device of their choice. Every single Shaw customer can freely tap into his or her home Internet service at over 75,000 WiFi hotspots across our cable footprint, free of worries about mobile data usage.

765 In the year ahead, we will introduce our cloud-based Xl platform, complete the wireless LTE upgrade in our existing markets and implement DOCSIS 3.1 throughout the wireline network. With each of these endeavours, we remain dedicated to fulfilling our promise that our customers won't miss a thing.

766 The Commission described the choice policy as a roadmap to maximizing choice for TV viewers and to fostering a healthy, dynamic TV market. Shaw is following that roadmap.

767 MR. JOHNSON: Many of the initiatives described by Jay are part of Shaw's evolution to becoming an enhanced connectivity provider. The acquisition of WIND Mobile and the sale of Shaw Media to Corns represent transformational steps in Shaw's history.

768 The WIND acquisition will enhance competition and provide the benefits of wireless bundling to subscribers across our cable footprint, including Limited TV customers.

769 The sale of our programming assets has created an integrated media and content company at Corus. At Shaw, the combined transactions have positioned each segment of our business to focus more intensely on connectivity and distribution.

770 Our new structure provides Shaw with a very clear perspective and strategic direction. Our connectivity focus has only served to reinforce our commitment to prioritizing the needs of our Shaw Cable and Shaw Direct customers. This proceeding has provided another critical opportunity to better understand their expectations and to work collectively to educate Canadians about the choice policy.

771 We strongly believe that the choice policy serves the interests of consumers. As the Commission has explained, the small basic achieves the objectives of the Act by:

772 - Ensuring that Canadians do not have to receive and pay for a large number of discretionary services that they may not want;

773 - Allowing BDUs to provide efficient delivery of programming at affordable rates and giving priority to the carriage of Canadian television services.

774 Although some have criticized both the specific services that are mandatory as well as the services that are not included on small basic, we believe that the choice policy provides a necessary balance among the objectives of priority carriage, flexibility and affordability.

775 The small basic introduces a low-cost entry-level alternative for Canadians who have left or those who are considering leaving the Canadian broadcasting system. Full pick and pay will realize the Commission's objective to "bring about greater choice and flexibility in the Canadian television system." We are confident that when full pick and pay is introduced in December, Canadians will appreciate the balance between choice and affordability.

776 MS. TAKAHASHI: The choice policy works. Limited TV works to provide our existing and prospective customers with yet another choice. It works as an entry-point for cord "nevers" and a re­entry point for cord cutters. It works as a retention tool and contrary to concerns raised in this proceeding it works as part of a bundled offering.

777 We can clarify and confirm that bundling discounts are available to Limited TV customers. Shaw neither forces customers into a bundle nor prevents customers from bundling with Limited TV.

778 Limited TV, small packages and individual pick and pay all fit seamlessly into our overall approach by providing affordability, choice, flexibility and value. Shaw has always remained committed to these objectives as part of our customer-focused strategy.

779 Before the choice policy was introduced, Shaw Cable already offered a wide range of individual pick and pay channels and packages that maximized choice and value for our customers:

780 - Personal TV continues to offer superior value as an entry-point for our customers;

781 - We offer even more of our best-selling content on "Popular TV". The popularity of this package demonstrates that our customers continue to prefer the value that is provided by bundling a large number of services;

782 - For those who prefer the ultimate programming experience, we offer "Premier TV".

783 Similarly, on Shaw Direct, we offer a wide range of plans and packages that are designed to meet a variety of customer needs. However, there is no denying that, for a segment of new and existing customers, Limited TV fulfills a previously unmet demand:

784 Many customers are happy to pay $25 and receive only the services included in small basic. Others love the flexibility to take Limited TV and then build their own suite of services through pick and pay and small packages. In fact, 70 percent of our Limited TV customers select additional services.

785 We have been equally committed to the other key elements of the Choice Policy as we launched a variety of attractive and affordable small, medium and large theme packs.

786 On Shaw Direct, we launched "Build-your-Own Package", allowing customers to pick five channels for $15, and 10 for $20.

787 We are even more excited about the launch of our full pick and pay options in December. Although these plans cannot be fully disclosed at this time for competitive reasons, we still require significant operational efforts before introduction and we cannot overstate the creativity, diligence and efforts of all our teams to upgrade our billing systems, update our website with a new builder functionality, design new technologies and business processes, create new packages, and of course negotiate affiliate agreements.

788 There is still some work ahead to ensure full technical readiness. However, we can guarantee that we are on track to comply and fully embrace the choice policy as one, but certainly not the only step, that we are taking to maximize the customer experience at Shaw.

789 MS. EMBERLY: We believe the high penetration of Limited TV reflects our support for the choice policy and our efforts to make it part of our overall business. After less than seven months, we have almost 70,000 Limited TV subscribers on Shaw Cable and more than 16,000 on Shaw Direct. Clearly, we have done our job to promote Limited TV and make it accessible.

790 Consistent with the Television Service Providers Code, the availability, price, and content of Limited TV are clearly communicated and displayed on our websites including the TV packages page, a dedicated Limited TV landing page, and a plan builder page, which allows customers to bundle.

791 Consumer groups filed evidence in support of their argument that Canadians lack awareness about the alternatives provided under the choice policy. We take all customer feedback seriously and appreciate the submissions of the Consumer Groups, including their survey evidence. However, in the survey, there were only 57 respondents who identified themselves as Shaw customers.

792 We believe the actual customer experience and Shaw's implementation of the Choice Policy are better measured by the large number of Shaw customers who are enjoying their Limited TV experience.

793 The Limited TV penetration levels clearly demonstrate that there is no need to further regulate the marketing and promotion of Limited TV as suggested by the consumer groups.

794 In today's highly competitive distribution environment, a range of factors inform the development of marketing strategies. The success of advertising campaigns is critical to building our brand, attracting new customers and ensuring customer loyalty.

795 Our promotional objective is to drive awareness and interest in Shaw products and services. Instead of focusing on one particular plan, we emphasize features like, speed, quality, reliability and value.

796 We then trust our customer care teams to help customers select the products and services that best meet their needs.

797 MS. WRIGHT: Consistent with the TVSP Code, we have taken significant steps to increase clarity.

798 It is absolutely in Shaw's interest to make sure that our employees are fully informed about Limited TV and the range of pick and pay options that are and will be available to customers. Extensive training of more than 6,000 customer-facing employees ensures that our customers are well-informed and empowered to make choices that address their needs.

799 Delivering exceptional customer service in all of our channels is integral to what we do at Shaw. At Shaw Cable and Shaw Direct, we are very proud of the dedication of our I00 percent Canadian-based customer care, retail and field operations teams.

800 Our sales and support philosophy is based on "Best Value, Best Experience". Rather than pushing customers to make selections that are based on Shaw's interests, our customer-facing teams are educated, coached and incentivized to understand each individual customer's needs and to make the recommendations that best suit those needs. Although we continue to believe that other packages provide more value for the majority of our customers, any customer whose needs are best met by Limited TV will be fully assisted with making that selection.

801 We were surprised and disappointed by one intervener who expressed frustration with their customer care experience. We can assure the Commission that our sales and support staff are not instructed to criticize the Limited TV offering. We are relatively early in the implementation of the Choice Policy and these rare experiences will be corrected over time.

802 To be clear, our customer care teams are committed to informing our customers about Limited TV, small packages and pick and pay.

803 MR. SHAIKH: There are additional aspects of Shaw's implementation of the choice policy that merit further discussion and clarification in response to concerns raised by interveners.

804 The fact that Limited TV-only customers do not have additional services like video-on-demand has been mistakenly interpreted as an attempt to deter customers from selecting Limited TV.

805 In fact, our approach is the most elegant technical solution to ensure consistency with both the choice policy and our system architecture.

806 Although the Regulations were silent on whether on-demand services should be included on the entry-level basic, we decided that limiting the composition of Limited TV to the services specified in the Regulations was appropriate.

807 At Shaw, Stingray music channels have historically been offered with VOD and, accordingly, they share a customer code. Undoing this code would take several months with uncertainty and risk for all subscribers. The Regulations prevent us from simply adding both VOD and Stingray to Limited TV.

808 Certain FreeRange content and apps and are not authenticated for Limited TV­only customers because of the unavailability of VOD.

809 Shaw introduced the most customer-friendly approach in light of these concerns. Every Limited TV customer with a $30 pre-tax subscription automatically receives VOD, Stingray and additional services.

810 Intervenors also raised concerns with two packages that are not available to Limited TV customers. These customers do not have the ability to add the regional and multiplex feeds in the Best of HD and Sports 1 packages because they do not receive the main TSN and Sportsnet services as part of their basic service.

811 We consider these limitations as necessary and relatively minor in consideration of Shaw’s clear commitment to implementing the Choice Policy.

812 MR. MEHR: We can assure you that every segment of our business remains committed to acting in compliance with both the letter of the Regulations and the spirit of the Choice Policy. The Commission described its roadmap to choice as a set of changes that were made to “reflect the trend towards increasingly competitive and customizable on-demand options, while talking into account the need to bridge old and new approaches to allow for maximum flexibility in how content is distributed and consumed.”

813 We believe that with the full commitment of programmers and distributors, the Commission will achieve the Policy’s objectives without the need for further regulatory intervention. Shaw has demonstrated this commitment and we submit that this proceeding should not result in the introduction of any new rules governing the promotion or delivery of small basic, flexible packages and pick and pay.

814 The Commission has provided a roadmap and it is up to individual BDUs, broadcasters and producers to follow it.

815 Shaw appreciates the opportunity to provide these comments and we look forward to answering your questions.

816 THE CHAIRPERSON: Well, thank you very much, ladies and gentlemen, for that presentation.

817 So I’ll start us off with a few questions. And, as I did with others, you’ll see that we’ll start off with some questions dealing with the March phase of implementation and then address the upcoming December phase of implementation.

818 So with respect to the March phase, could you describe -- I know you address some of it in here but I’m just wanting to make sure that you’ve covered it all -- what efforts you put into place to promote the small basic service and the flexible packaging offers?

819 Did you -- I saw that you mentioned that you created a better website. Did you do outreach emails or other direct contact with your existing customer base? Did you have other promotional material and newspapers and other media?

820 So exactly what -- if you could provide me some concrete examples of all the promotional efforts at the time.

821 MR. MEHR: Perfect. We’ll start at the high level and then maybe I’ll turn to Katherine to fill in with some additional specific examples.

822 Think of our approach to March in three terms. One is, as you’ve often said, we got out a little bit early, which may not seem like much, but because we were the first out with announced packages we’ve benefited from a tremendous amount of free media in the first four or five days. While media was reporting on speculating what others would do we were the one in the marketplace in the second half of February with what we were actually doing and it really allowed us to get in front of the story and I think we were a little bit more fortunate than purposeful there but it worked out very nicely for us.

823 For sure our major effort was the training of our 6,000 customer-facing people absolutely anchored in the best value best experience program that you’ve heard us talk about and we’re very proud of how our team has interacted with our customers on this, and then of course complete implementation across all of our properties, including the websites for Shaw Cable and Shaw Direct.

824 I’ll let Katherine add specifics.

825 MS. EMBERLY: Yes, every place that we had our other packages we also had Limited TV. So we were really committed to clarity and transparency.

826 One of the big pieces that we did was the builder so that customers actually could see for themselves what it looked like when they combine and bundle different variations of packaging, and that was a big tremendous effort.

827 And maybe Sarah to add to the customer care.

828 MS. MILLER WRIGHT: Sure. Thanks.

829 So as Katherine mentioned, the builder was an important part of what we did both for our customers as well as our customer-facing staff. What we found is we wanted to make sure that the conversations that our customers were having with us were easy, were clear, that we were able to really assist them by asking great questions, really making sure that we were hitting on what their needs are for them in their household and then coming up with a reasonable solution that would make sense.

830 So there was an extensive amount of training done. I recognize that all of the respondents here today are talking about their training programs. Ours is really rooted in a philosophy that extends even just beyond the individual conversations with our customers. It really goes to all of our customer facing staff, including our field operations team, anyone who interacts with our customers. We want to make sure that we’re listening to our customers and that we’re coming up with solutions day in and day out that continue to meet their needs.

831 THE CHAIRPERSON: Well, you shouldn’t apologize to talk about the CSRs in your system or elsewhere because I think they make the difference and create value, right, because they know your customers best.

832 MS. MILLER WRIGHT: Couldn’t agree more.

833 THE CHAIRPERSON: And they don’t get a lot of profile and sometimes they get a lot of grief.

834 MS. MILLER WRIGHT: Absolutely.

835 THE CHAIRPERSON: So we have people that do those jobs at the Commission as well and we know how difficult those can be, but we -- so glad to hear the training had occurred and I know it can’t be 100 percent perfect.

836 But when you look back at all this, do you consider you were successful in creating awareness for the new options? I mean, you were in the marketplace sooner. So what are the -- in your view -- I see people are nodding yes, you were successful. But what are the indicia’s of success? Is it the number of customers who actually subscribe to the small basic? Is it the number of complaints you received or didn’t receive? Did you get feedback from potential customers or existing customers on the clarity of your offering?

837 MR. MEHR: Great. Thank you.

838 I hadn’t intended to nod that we were successful. I’m not sure what I was doing there.

839 I mean, some things worked, some things didn’t work, right.

840 THE CHAIRPERSON: See I’m very conscious about the transcript so I ---

841 MR. MEHR: For sure.

842 THE CHAIRPERSON: I always do that.

843 MR. MEHR: Yes. Okay.

844 THE CHAIRPERSON: Sorry.

845 MR. MEHR: No, no, no problem.

846 THE CHAIRPERSON: It’s a professional deformation.

847 MR. MEHR: And I was nodding. So it was true.

848 To be clear, some things worked and some things didn’t work. We had about what we expected but significant balance early. So there was a 10-day period where everybody was extremely busy with customer questions and packaging and big volumes of customers more than a couple thousand a day changing their level of service. And so I think we were successful in creating a strong balance and a level of interest. And I think you were successful in creating a lot of context for people to think about their packaging and try and figure out what it meant for them. So I think that absolutely worked.

849 We are pleased in our numbers. We gave you August 31^st customer numbers and I know you released June 30^th numbers, so we may be timing on reconciliation there. As you’ve seen, our numbers have consistently grown month-over-month, so we’re very pleased with how it’s growing. And what’s interesting is our number of new customers who are entering unlimited TV is dramatically increasing compared to what it was in the March/April period. So we’re seeing some positive trends there.

850 While in general terms we’re achieving results that are relatively consistent with our expectations. This is a new world for us. I was intrigued listening to Videotron talk about their experiences over a decade. This was really -- we’ve been in choice for a long time but we’ve never been in choice quite this way. And so we learned a lot as we went along. A lot of things are different than we thought they would be. We’d probably like to have some do-overs that would make things more simple.

851 So I think in general terms we’re happy with the overall result. We think the policy works and it works for our customers, and by the way, it works for us, and I think it is getting the intended outcome that you intended but I wouldn’t describe it as completely pristine.

852 THE CHAIRPERSON: Okay. But the aspects that were less than pristine I take it you’re using those to build some learnings for the next phase in December?

853 MR. MEHR: Yeah, for the next phase and for the evolution of this phase because we -- there’s nothing to prevent us from getting better and more streamlined in how we offer our services for sure.

854 THE CHAIRPERSON: Right.

855 Remind me, on the satellite side, on the DTH side, you were -- you had customers in Quebec, Videotron had moved to more choice, what were you doing in Quebec? You were aware of what Videotron was doing, were you not?

856 MR. MEHR: Yeah, for sure.

857 Customers find their way to packaging based on a variety of factors, so we’re a relatively small player. And in terms of overall market shares, the Quebec market is important for us in Shaw Direct. But we were able to go out in Quebec with our value offering, and Videotron was coming into the market with a customization offering, so there was room for -- at that time for both us to do both. And interestingly enough, we haven’t seen a big index in Quebec since we moved to the more flexible packaging. I would suspect because Videotron had already captured that base because ---

858 THE CHAIRPERSON: Right.

859 MR. MEHR: --- they got there first.

860 THE CHAIRPERSON: Contrary to you on the March 1^st where you might have gotten lucky ---

861 MR. MEHR: Sure.

862 THE CHAIRPERSON: --- in getting out first. Right.

863 MR. MEHR: Yeah. So there was a space for us to compete and come back previously, right.

864 THE CHAIRPERSON: So when you were getting ready for the first phase, did you do polling or market studies in terms of, you know, focus your websites or your marketing with consumer groups or -- how did you go about deciding what you needed to do other than asking the regulatory shop?

865 MR. MEHR: Well to be clear, the regulatory process was helpful because there was a tremendous amount of information on the record and --probably an unprecedented amount of information on the record -- and we do try and participate in these processes proactively and always -- always to learn, so that was a big part of the process.

866 To your point earlier, our customer service people totally know what our customers want, because they talk to 50 or 80 of them every single day. And one of the things about Shaw Customer Service people under Sarah’s leadership, is they're not afraid to share their opinion. So we had -- we had very animated discussions internally around pricing and packaging.

867 I don’t know if the team would like to add? No? We’re good.

868 THE CHAIRPERSON: So there was a feedback loop through your CSRs, but not necessarily a formal marketing test and so forth. So that’s the way you figured out what your customers wanted?

869 MR. MEHR: Yeah, we did some formal marketing tests, which we shared with you as part of the Talk TV format. I think to be clear, this was a -- this was a reasonably well researched change because of the level of effort that went into the Talk TV proceedings. We had that sort of advance research, what we didn’t have was field market experience, which is what we’ve learned since.

870 THE CHAIRPERSON: Right. Did you work with the consumer groups at all or that wasn’t necessarily something that you focused on?

871 MR. MEHR: I don’t believe we had any specific outreach to consumer groups.

872 THE CHAIRPERSON: So if you were to summarize your top three best practices for the March launch; what would they be?

873 MR. MEHR: Our top three best practices were absolutely fundamental focus on "Best Value, Best Experience" training for our team, to really engage with the customer and understand what their needs were and be able to work hard with them to tailor the most suitable package. I think to try and be as transparent as possible in terms of the strengths and weaknesses of our product offering. I think that was a strength.

874 And in hindsight, I don’t know that we fully understood how important making sure the bundling discounts were available to our limited TV customers, but it’s worked out really for us; our limited TV customers are our most bundled customers today. And so, a great example of how if you make things possible for customers, they’ll find their way to things that provide them the most value.

875 THE CHAIRPERSON: So when you did note some consumer dissatisfaction, how did you go about correcting course?

876 MR. MEHR: Yeah, I think that when we talk about a training program or not, we’re not talking about a training program that started and ended March 1^st and was left alone. I think there's been a tremendous amount of coaching and iterations on how we’ve been proceeding.

877 I think -- I think as everybody gets comfortable with the value that limited TV provides the customers, I think we’ve all just become more aggressive about sharing it with customers and trying to demonstrate the value of it.

878 Do you want to add, Sarah?

879 MS. MILLER WRIGHT: Sure. The premise as I mentioned with "Best Value, Best Experience" is again listening to our customers, coming up with solutions. And the great thing about that is it isn't related to one particular product or package, or to Jay’s point, around a March 1^st deadline. Similarly, as we approach December, we’re able to really build on this foundation that we already have existing. It means that it makes us very flexible as well as we go. So as we get feedback, as we hear more from customers and from our customer-facing staff, it allows us to filter that information back through the system so to speak.

880 So we’ve got a great internal internet that we use that all of our customer-facing staff has access to. Much of it is moderated as well as crowd-source, so it's an opportunity for a lot of our employees to really share their experiences, some of their opportunities, so that we can then continue to go back through and iterate as we go. So that’s been a huge source for us as well throughout the process.

881 I think that would be pretty much all that we would add at this point.

882 THE CHAIRPERSON: Right. So the notion of a training manual for your CSRs sort of dated in time, so I take it it was more of an internet-based approach and scripts?

883 MS. MILLER WRIGHT: M'hm.

884 THE CHAIRPERSON: Would that be correct?

885 MS. MILLER WRIGHT: Not really scripts so much. So the way that we rolled out "Best Value, Best Experience" was initially we actually trained our leaders first. So our leaders were the group that we started with for a very specific reason. We really anticipated that we were going to be rooting ourselves in this philosophy for an extended period of time. So we need our people to buy in and to focus and to ensure that they really, truly understand what we’re doing.

886 So by beginning with leaders and then having our leaders also co-facilitate with our training group, it allowed us to really extend the reach of what the program’s all about. So it is a little bit more than a training manual, we would so humbly say, because of the fact that we extended it into such a large part of the organization as well.

887 We don’t operate with scripts specifically. What we do operate within is a framework, and it’s a pretty specific one with four components, everything from how you open a conversation with a customer through to discovery dialogue and recommending winning solutions to referrals and recap at the end. So that it provides a good, strong, as I mentioned, guideline for all of our customer-facing staff and it's something that we can build upon.

888 THE CHAIRPERSON: Sure. So I take it it was, you know, in terms of training it was more than just documentation, it’s a whole process?

889 MS. MILLER WRIGHT: Exactly.

890 THE CHAIRPERSON: I get that. But with respect to documentation, is it a body of documentation that can be identified?

891 MS. MILLER WRIGHT: Sure.

892 THE CHAIRPERSON: And would you ---

893 MR. MEHR: Yeah.

894 THE CHAIRPERSON: --- undertake to file it with us?

895 MR. MEHR: It is, and we did hear the undertaking and we’ll undertake for Friday to submit ---

896 THE CHAIRPERSON: Okay.

897 MS. MILLER WRIGHT: M'hm.

898 MR. MEHR: --- the materials.

899 THE CHAIRPERSON: Thank you.

900 MR. MEHR: We’ll have to figure out how to deal with confidence, because much of it won't be in confidentiality, but a bit of it will be, so we’ll figure that out.

901 THE CHAIRPERSON: I mean you're familiar with our processes and ---

902 MR. MEHR: Yes.

903 THE CHAIRPERSON: --- be able to make those arguments as required.

904 So you did not have scripts? That’s not something -- I mean there were media reports about certain scripts during the March phase one, but you were not involved in scripts in any way, shape or form; is that correct?

905 MS. MILLER WRIGHT: Absolutely not.

906 THE CHAIRPERSON: What is your company’s approach if a subscriber wants to change their programming options? You may have heard the conversation we had with Rogers where their policy is that they actually need some sort of human contact, either in a store or on a telephone line. Is that consistent with your approach or could somebody self-serve completely? Not that they don’t want to talk to your excellent consumers -- your excellent CSRs, but they might just rather do it at 2 o’clock in the morning and, you know, do it themselves.

907 MR. MEHR: Yeah, for sure. So as a guiding principle, our company approach is absolutely a consumer should be able to deal with us however they choose to deal with us in the way that is most effective for the consumer. And consumers understand how they like to interact, and some like a variety of different ways.

908 And you can for sure change your packaging using our builder on both Shaw and Shaw Direct, and make your own choices without -- in advance or without talking to a customer service representative. So that’s absolutely where we hang out.

909 I think to be clear and to be transparent, we’re headed our way down that journey. I don’t think we’re best in class globally in terms of a digital service model and we’re working hard to be best in class globally, but we differ in that approach which is we'd like consumers to deal with us however they'd like to deal with us.

910 THE CHAIRPERSON: Right. And if you were to describe in percentages those people that interact with you in a pure digital space as opposed to some sort of telephone or in-Shaw contact, do you have a sense?

911 MR. MEHR: That is hard because it is clear that even if a customer ends up phoning us, they start in the digital space in the majority of instances, so there is a hybrid place where consumers do both.

912 I don't know if either one of you want to add a stat or if you want to take it away?

913 MS. MILLER WRIGHT: I wasn't going to add a stat but what I would say is to Jay's point.

914 The digital property does act as a great point for customers to do a lot of research, to go through the builder experience. And sometimes it's just either having a call or using online chat. We also have proactive chat that we use in the builder so that if a customer is sort of lingering or it seems like they might need some help we can offer a chat in that situation as well.

915 So a lot of times it is multichannel that occurs but, in preparation for the March launch, we were aware of that and we wanted to build our properties with that in mind that it would be an opportunity for either a customer to exclusively use a self-serve experience or to use a hybrid channel experience.

916 THE CHAIRPERSON: Right. Does your builder software interaction allow de-building, like if you wanted to, yes, subscribe?

917 MR. MEHR: Yes.

918 THE CHAIRPERSON: So if you want, one day you decide I don't want this service anymore ---

919 MR. MEHR: Sure.

920 THE CHAIRPERSON: --- unlike others, you are not forcing it?

921 MR. MEHR: It works both ways, yeah.

922 THE CHAIRPERSON: Okay. You de-build.

923 MR. MEHR: A lesser service or you can build a service.

924 THE CHAIRPERSON: Right. And what is -- I mean the problem we talked earlier about legacy offerings what -- how do you approach that if somebody has a legacy offering, tries -- there is a fly. This summer has lasted too long. I shouldn't say that too fast. I'm sorry.

925 MR. MEHR: Not in Calgary. Summer never lasts here.

926 THE CHAIRPERSON: There is -- I lost my train of thought with the fly flying around ---

927 MR. MEHR: You were on legacy and how do you go back.

928 THE CHAIRPERSON: --- on the table flying around me here.

929 MR. MEHR: I think you were at ---

930 THE CHAIRPERSON: If somebody had a legacy offering and they want to try one of the new offerings either with a limited offering plus some other package or options or bundles, and they experience dissatisfaction; it didn't meet up to their expectation, what's your approach to somebody going back the other way?

931 MR. MEHR: Yeah. So we are super easy in that you can change your package and you change them in real time and move your package.

932 We're not in the same situation as one of the other companies before you today in that we moved away from that historical basic and the three tiers a number of years ago. Again, to be clear, likely because of competitive reasons as opposed to virtuous ones but however we got there we moved ---

933 THE CHAIRPERSON: Competition is good.

934 MR. MEHR: Yeah, yeah, competition is good. However, we got there we moved there a number of years ago.

935 So only 7 percent of our customers are still in the sort of traditional basic with three tiers and so those customers would have trouble moving back that 7 percent. But we have 70 percent of our customers on current packages and the others are on value packages that we can move them in and out of.

936 So we are not in that circumstance. Customers, if they phone us that day, they can change their level of service and their billing will be prorated based on ---

937 THE CHAIRPERSON: Right.

938 MR. MEHR: --- up or down or wherever they go.

939 THE CHAIRPERSON: But there is no set trial period whereby you ---

940 MR. MEHR: No.

941 THE CHAIRPERSON: --- if you have gone from a legacy to a ---

942 MR. MEHR: You can change your video service.

943 THE CHAIRPERSON: Yeah, okay. So you just -- it's a case-by-case basis that you would allow people to go back to legacy?

944 MR. MEHR: Yeah, or said another way, you're empowered to change your services as often as you want ---

945 THE CHAIRPERSON: Right.

946 MR. MEHR: --- to whatever you want whenever you want.

947 THE CHAIRPERSON: Looking back, which in your view is the best promotional tool for the Phase 1 launch in terms of either promotional tools or communication platforms?

948 MR. MEHR: Yeah. For us there was no question it was free editorial media. If you look at the spikes that we got in volume, the amount being a lead story on the news for a relatively good thing was good for us.

949 THE CHAIRPERSON: Okay. And I take it there are lessons to be learned for the next phase?

950 MR. MEHR: Yeah, there are ---

951 THE CHAIRPERSON: A little bit harder to engineer, I guess.

952 MR. MEHR: A little bit although we're ready. I mean we've got a core structure around pick and pay today. I think we'll be expanding that.

953 I think, to be fair, many of the services that are offering pick and pay today are potentially less heavily viewed and therefore we were able to negotiated pick and pay in those agreements. As we move to all things pick and pay, I think there is absolutely lessons for us to proceed.

954 And we are -- we're excited about it. I think we are going to end up in a good spot.

955 THE CHAIRPERSON: When I look back and read the interventions and some of the comments we saw, there seem to be a certain amount of frustration from your subscribers. You address it in part in your oral comments that those basic service subscribers had limited access to VOD, Sports 1 and the Best of HD discretionary packages.

956 What do you say to them?

957 MR. MEHR: Yeah. I would put those in two separate categories. The Sports 1, Best of HD packages are packages that were built as add-on packages to legacy packages and so -- and all of our legacy packages, including Personal TV included sports. So it included TSN 1 and Sportsnet One and, therefore, the other packages were able to round out your sports services with the other feeds of sports because you were already subscribing to the first one.

958 But neither of those packages are particularly successful nor do they provide great value to a Limited TV customer today. They are not the best value on ramp to get sports. So we can work our way through -- there is a couple of solutions.

959 Dean can get you up to speed on how a customer gets there because they just first have to get what the initial TSN and the initial Sportsnet in order to get the other feeds of those.

960 Our own view is that's a little bit of noise of people trying to completely duplicate legacy. Best of HD is $35. We can get you there for way less than that in terms of a similar package on Limited TV with theme packs, and so I think we just need to work with consumers. The problem when you launch a package and I have been with Shaw long enough that both of those were my good ideas at the time, is you end up then trying to figure out what you do with customers from that space.

961 So I would -- my own view is that we are going to work hard on those things but that's necessary noise around how to deal with the multiplex of sports feeds.

962 The VOD situation is suboptimal and unfortunate. You know, we are in compliance with the regulations but we don't like where we are.

963 The way we built our billing system, VOD and Stingray -- it wasn't Stingray at the time, but the music services were hardcoded together in the way we deliver them, and it was very difficult to separate them. And so we came up with a compromise at the time which seemed reasonable at the time that if you took additional video services which 70 percent of Limited TV customers do, to a minimum of $30, you got Stingray. And by getting Stingray you also enable VOD. They are just unable together.

964 THE CHAIRPERSON: Right. But the way you describe it, it seems like the tail wagging the dog. It's the structure of your system that is driving how you are offering it. So presumably with enough time you are able to redesign your systems to get around that.

965 Is that what you are working on?

966 MR. MEHR: Yeah. Yeah, look the -- it's clearly suboptimal; right? And we didn't build it to end up here. We were facing a bunch of complexity and in making choices we made the choices that we made.

967 We'd love to be able to offer Stingray as part of our Limited TV which would be the easiest fix. We didn't -- we didn't make the commitment as part of this process to ad on-demand services to Limited TV partially because the team says it's hard; partially because we don't really like sort of last minute, sort of walk-ons. But it's not lost on me that it doesn't seem -- it wasn't designed that way.

968 Our spirit is good. It complies with the language but it doesn't seem -- it seems unseemly so we are going to work to make that right.

969 THE CHAIRPERSON: Right. And some of your competitors may be forcing you to do that or else you get left behind perhaps.

970 MR. MEHR: Yeah, perhaps, although I think it's the unseemly more than the other in that the transactional VOD movie is not as relevant as it once was. And so I am not as convinced that we are losing customers because of the 30 percent of Limited TV are not getting access to transactional VOD, although I am open to there being a portion of that, but we'll find a way to end up in a better spot.

971 THE CHAIRPERSON: Your label, "Limited TV", was that focus-grouped at all? A little bit more one might think that you should have called it "Broccoli TV".

--- (LAUGHTER)

972 MR. MEHR: The -- thank you.

973 And by Broccoli, I'm assuming you're describing that pejoratively?

974 THE CHAIRPERSON: Yes.

975 MR. MEHR: Yes.

976 THE CHAIRPERSON: I know there are some people that embrace broccoli, but I'm just using the stereotype, but maybe it's good for you but it may not be as exciting.

977 MR. MEHR: Yeah.

978 THE CHAIRPERSON: It just seems -- wouldn't you agree with me that the word "Limited" is not as enticing as let's say a Happy Meal?

979 MR. MEHR: Yeah, sure.

980 I -- we hear you. It was our intention to be descriptive. For sure when you test, what people were saying was the unmet expectation was that I have to pay for a bunch of channels that I don't want. That I'm somehow wasting money by getting more channels that I don't want to have to pay for.

981 And that the current system was taking care of people who wanted abundant TV and mega TV and however you wanted to justify that nomenclature. So I think it was designed to be distinct from that, which is only the services that you want and it's limited to that.

982 Marketing is hard and ---

983 THE CHAIRPERSON: Well, I appreciate it. I mean, when we used to draft potential recommendations to ministers, we often talked about Goldilocks because there was always one that was too hot, another one that was too cold, and yet the middle one was always just right.

984 MR. MEHR: Right, sure.

985 THE CHAIRPERSON: So I appreciate it's difficult, but it seems strange to me that you would call it so unappealingly, "Limited".

986 MR. MEHR: Yeah, and it's because it's designed to actually be separate and distinct from anything we've done before, and say to customers you don't have to pay for channels that you don't want to pay for. And I guess we go back and say miraculously our customers seem to love the name. They're buying the service.

987 THE CHAIRPERSON: Right.

988 MR. MEHR: So -- but I hear your point and I will share your feedback with the team.

989 THE CHAIRPERSON: Far be it for me to do marketing for you.

990 After the 1^st of December, what will happen to TSN, Sportsnet, and their respective multiplexes for the small -- for the Limited TV users? Would they still be able to do all the multiplexing if they went to a pick‑and‑pay with those specific TSN, Sportsnet, and their multiplexes?

991 MR. MEHR: Yeah, so the packaging that they receive today they'll be able to receive, there's some discussion with -- I'm sorry; I should be looking this way. There is some discussion with a couple of the content producers on the size of the package, and so we might -- we may or may not have to make some changes on the Shaw Direct size on the side of our package. I'm confident we'll be able to grandfather the existing base, but there's questions of what makes up the size of a package.

992 We are in negotiations with some of our sports providers currently. I am totally confident that we'll meet the regulations and offer a pick-and‑pay product. I don't believe we're splitting the TSNs. I believe the pick-and‑pay product would be a TSN pick-and‑pay. I'll let Sanae fill in there.

993 MS. TAKAHASHI: Yes, that's correct.

994 So we're still in the process of negotiations, but the expectation is that you'll be able to pick your Sportnets versus your TSNs, and of course, packs that include both and packs that also include all of the above as well as other sports entities.

995 MR. MEHR: But we don't believe they'll be able to pick TSN1, and not 2, and take TSN3. I think you're taking it as a multiplex?

996 MS. TAKAHASHI: Our expectation right today is a multiplex, yes.

997 THE CHAIRPERSON: Yeah, so it's a multiplex as a package, in a sense?

998 MR. MEHR: Well, I think they call it a channel. I think they call all five multiplexes a channel.

999 THE CHAIRPERSON: Whatever they call it, you know, there's a regulatory aspect to it and there's maybe a license associated with each one ---

1000 MR. MEHR: Yeah.

1001 THE CHAIRPERSON: --- or an authority associated with each one.

1002 MR. MEHR: Yeah, so we're going to meet the regulatory requirement December 1^st and I'm confident that we'll be there. Not unlike a previous presenter this morning, I'm not as confident that we'll have affiliate or -- formal affiliate relationships completely documented for December 1^st. There may be offerings of our carriage agreements that aren't' complete, but we're certainly committed to getting there.

1003 We're committed to getting there at the best value for consumers. For sure, premium movies and sports are the outlier in a pick-and‑pay world in terms of the dollar value that it appears. I mean, I can't say what we're going to price because we haven't concluded an agreement but it appears like it's going to me more than other services.

1004 THE CHAIRPERSON: So I take it from that, you haven't completely finalized your strategy, it's a work in progress heading towards the second phase; is that correct?

1005 MR. MEHR: Yeah, I think it's clear that we finalize our strategy if our strategy is the construct of the house and our purpose. We haven't finalized the price point to only where we haven't got firm affiliate deals. So we've got a spot there and we will be offering it December 1^st for sure, but we haven't completed the wholesale rate.

1006 THE CHAIRPERSON: Right.

1007 Would it be possible for you to undertake to provide for us, and you may request confidentiality obviously, of your current plans, including your working hypotheses for the retail prices for the pick-and‑pay aspect?

1008 MR. MEHR: Yeah, for sure, we have that.

1009 THE CHAIRPERSON: And you can do that by the Friday deadline?

1010 MR. MEHR: Yeah, we can get you the current form, and the current form is largely complete.

1011 THE CHAIRPERSON: Yeah, and I realize you'll have to add some caveats because there are things probably currently you are not aware of that are still in flux.

1012 MR. MEHR: Yeah, and I do believe the only caveats are wholesale rates where they haven't been negotiated, because we do have the plan in place.

1013 THE CHAIRPERSON: Right.

1014 MR. MEHR: So we'll give it to you for Friday.

1015 THE CHAIRPERSON: And as you said, you'll make the case for confidential treatment because you're still in negotiations, presumably?

1016 MR. MEHR: Correct, thank you.

1017 THE CHAIRPERSON: And do you also undertake to keep that strategy updated as we go along?

1018 MR. MEHR: Yes.

1019 MS. TAKAHASHI: Yes, we do.

1020 UNDERTAKING

1021 THE CHAIRPERSON: Thank you.

1022 There may be a perception by consumers that an à la carte offering will be overpriced, and I was wondering if you could help me understand that, you know, that retail pricing for à la carte services, whether they're Canadian or non‑Canadian are often several times more than the wholesale price that we're aware of; right? Because we have the agreements and we know what the retail price is, and there is sometimes a disconnect between those.

1023 So what do you tell consumers that may perceive that the à la carte service will be -- I'm not saying these are my words -- but that they would be strategically priced so much that they become completely unappealable, and therefore, driving people to other packages?

1024 MR. MEHR: Correct.

1025 I mean, we would certainly assure consumers that the markup that we're taking as a distributor on the wholesale rate that we're receiving is not disproportionate on standalone services.

1026 THE CHAIRPERSON: But there is a markup?

1027 MR. MEHR: There is a markup.

1028 THE CHAIRPERSON: Yeah.

1029 MR. MEHR: There is a markup. For sure, we will make less money in a limited TV pick-and‑pay world than we'll make in our current packaging as a dollar value that we're making profit on video. I think that much is clear and it's all okay, but we've certainly seen that in our limited TV and small package experience.

1030 So I think what gets lost is the -- you might look at in a package we're paying a certain amount for Food Network and what we would retail it on a standalone basis might be an order magnitude of that 80‑percent penetration rate. It won't be a multiple -- it won't be three times the standalone rate, it'll be significantly less than that.

1031 So the rates, we're doing the best we can to negotiate the best standalone rates as possible and we'll have a range of prices so that we can slot services. The services that give us a lower wholesale rate we'll be able to charge a much lower retail rate for.

1032 So there's -- if anyone is concerned that distributors are going to get rich on the markup of individual standalone services, I don't think there's any risk of that.

1033 THE CHAIRPERSON: And is it your view that there are downward pressures on the markups that you might have historically been able to get but you might not be able to get anymore because there's other players in the system undercutting your prices, and therefore, you have to match their -- what's going on in the marketplace?

1034 MR. MEHR: Yeah, for sure. For sure.

1035 It has been well reported in the industry, not just in this country but certainly in this country of what’s happened to video margins over the course of the past five years, and it’s clear video margins have substantially declined over the course of the last five years. And I think you’ll see a managed piece of change there, but programming costs are going up quicker than video rights are going up.

1036 THE CHAIRPERSON: Right.

1037 MR. MEHR: And that’s just -- that’s probably healthy, and it’s choices, and it’s all good, right. We compete in the marketplace with the choices that consumers have today. We don’t compete in the marketplace of 10 years ago and therefore the margins are different.

1038 THE CHAIRPERSON: Right.

1039 So, if I understand correctly, bundling discounts, if you’re involved in your small basic service Limited TV, those bundling discounts continue to be available when you’re purchasing other lines of product

1040 ---

1041 MR. MEHR: Yes.

1042 THE CHAIRPERSON: --- internet and so forth?

1043 MR. MEHR: Yeah, so as a guiding principle -- and this we got right -- anything you can bundle with video you can bundle with Limited TV. And as a result, 90 percent of our Limited TV customers have bundled with either internet, or phone, or both, which is higher than our base, and our triple-play customers of Limited TV that take both internet and phone with Limited TV is materially higher than it is in our base.

1044 So I think both of those support the notion that consumers are looking for greater value ---

1045 THE CHAIRPERSON: Right.

1046 MR. MEHR: --- and they’ve done Limited TV and then taken advantage of bundled discounts to save money on their other products and services.

1047 THE CHAIRPERSON: Was this a fully thought out business strategy or a bit of one of these accidents when you decided? Because others decided not to do the bundling, and I was wondering, was it part of your decision that this was better value or you just did it because you thought it was regulatory.

1048 MR. MEHR: Good philosophy. But I’ll let you ---

1049 MS. TAKAHASHI: No, it was absolutely mindful in terms of making sure that we continued to support our customers’ ability to make those choices as they deem fit for wherever they happen to be in their stage of life.

1050 THE CHAIRPERSON: M’hm.

1051 MS. TAKAHASHI: And so we wanted to be able to continue to support providing all the services that Shaw could provide to that household.

1052 MR. MEHR: So I think the philosophy is right. To be clear, I was surprised that the number of triple-play customers amongst Limited TV customers at Shaw would be almost 50 percent higher than the base. That’s not something ---

1053 THE CHAIRPERSON: You didn’t expect that.

1054 MR. MEHR: --- I expected.

1055 THE CHAIRPERSON: So that was the nature of your surprise not the ---

1056 MR. MEHR: And it’s a lovely surprise.

1057 THE CHAIRPERSON: Yeah, I’m sure.

1058 And are these discounts automatically applied to people or do they have to ask?

1059 MS. TAKAHASHI: They’re automatically applied.

1060 THE CHAIRPERSON: So when you see somebody’s got a double, triple-play they get the discount?

1061 MS. TAKAHASHI: Yes.

1062 THE CHAIRPERSON: Now, I asked this of others earlier, and we certainly see some smaller entrants offering the small basic or the skinny basic, whichever -- or Limited TV in your case, these new entrants are -- whether they’re licensed or exempt are offering it sometimes at much lesser amounts, $18, sometimes $20, whereas you’re more at the high end of the ceiling. Why do you think that is, and are you intending to change your approach?

1063 MR. MEHR: I would say that the amount of change that’s gone on in our video packaging in the last six months has been material and so we’ve not intended to accelerate that change by moving a bunch of levers and trying half price for three months or $18.

1064 Over time we’ll absolutely play with those levers as the business is settled down as we now understand. I mean, we didn’t really even have the model to be able to do the analytics of some of these puts and takes. We think we’re in the market and there’s a premium customer service that you get from Shaw that every customer gets, and so we don’t think we’re losing customers because we’re at $25. But I think it’s fair to say that we’ll use those levers, as we do with our other products and services, over time, so I think you’ll see us be competitive in the marketplace.

1065 THE CHAIRPERSON: Because one could deduce that, you know, if a player is underselling you and that you’re still not lowering your prices that it may be as a result of your dominant position in the marketplace and then obviously there’s competitive -- competition law issues associated with that.

1066 MR. MEHR: Yeah. I think you’d have a hard time making the argument with the transformation of this industry that we’re in a dominant position in the video space. I think that would be a hard argument to make. And I think if you look at the way we approach all of our packaging, it’s about providing customer value. It’s about providing customer value and about competing in the marketplace.

1067 I think we’ve got seven percent basic and tier customers, where others before you today had a massive number of that, because we’re way further down the competition path in western Canada in terms of the transformation of packaging and so forth.

1068 We decided, rightly or wrongly, to come into the marketplace with what -- to come into the marketplace with the regulatory price point that was provided.

1069 THE CHAIRPERSON: That was an up to amount, to be fair.

1070 MR. MEHR: Yeah, to the maximum amount that was provided. To be fair, that’s absolutely factually correct.

1071 And it -- with flexible packaging throughout, with bundled discounts, with other things that we bring to the table, with FreeRange TV included so you could take it on the go with all of the -- without restrictions of how you package and so forth, so we did a -- we thought we came in with the right spirit.

1072 Did we get everything right? No, we didn’t. Will there be opportunities to adjust price over time in the competitive market? I think for sure there will be.

1073 I mean, if you -- it’s not a secret. If you watch what’s happening in western Canada today we’ve got an extraordinary competitive market. We’ve got extremely competitive on internet with wide open Internet 150. Our primary competitor has responded by getting extremely competitive on video. This movie’s not over yet.

1074 THE CHAIRPERSON: So you envisage a possibility at least that ---

1075 MR. MEHR: Absolutely.

1076 THE CHAIRPERSON: --- that the forces will require you at some point perhaps to rethink that price point?

1077 MR. MEHR: Yeah, and not just being forced to, that we would choose to. I hope you hear in our comments that we like the transformation of our customer base that has happened here. We think it’s further examples that when you empower a customer to make choice it’s good for your business. And so we may well be forced to but there’s a path forward here that we may choose to as well.

1078 THE CHAIRPERSON: To get ahead of your competitor I guess. You could be the market mover.

1079 MR. MEHR: Yeah, for sure, and we often are.

1080 THE CHAIRPERSON: No, no, I’m not suggesting that, I’m just trying to see how you foresee the coming months and years with respect to that.

1081 MR. MEHR: Yeah, and lifetime value of ---

1082 THE CHAIRPERSON: I wouldn’t want to regret that we should have set it at $20.

1083 MR. MEHR: No, for sure. For sure.

1084 Lifetime value of customer is probably the number one measure and there are way more things that go into lifetime value of customer than the monthly retail price. So you can maximize lifetime value of customer absolutely with a lower monthly retail price and what it makes possible on turn, what it makes possible on the other characteristics of customers. So we want a long-term relationship with customers. That’s in our best interest.

1085 THE CHAIRPERSON: Can I turn now to the prices, whether it’s rental or purchase of equipment, set top boxes and PVR’s. Would you agree with the statement -- and you can disagree -- that the prices for those have remained relatively stable over many years?

1086 MR. MEHR: If we talk about the customer premise equipment space, I wouldn’t agree with that statement like for like. For sure the cost of the modem in the home has gone down. The set tops, there’s an offset where you’ve got much more powerful PVR’s being compared to non-PVR’s, home gateways being compared to single supplier boxes.

1087 I think there’s been a nice downward movement from suppliers in terms of up pricing at the medium end. I think where there’s been a challenge is there hasn’t been a lot of innovation on the entry level box and so the first entry point -- I know some tried DTAs, we didn’t do DTAs -- the first entry point has not come down but certainly the cost of a whole home gateway system, and as we launch the X1 platform and we’re on the Comcast roadmap with that economy of scale that cost comes way down from what it historically was.

1088 THE CHAIRPERSON: And so you foresee in certain market segments, depending on the box, the equipment, that there will be from your suppliers’ price decreases?

1089 MR. MEHR: Yes.

1090 THE CHAIRPERSON: And they would be passed on presumably to your customers?

1091 MR. MEHR: Yeah. So pricing has an element of subsidy to it and an element of cost recovery. We certainly don't make -- when we sell boxes to customers we certainly don't make money on the sale of the box. It's about what the subsidy is.

1092 I think we're on record as communicating that the cost through our Comcast roadmap that we have seen a 40 percent reduction in the boxes that we will be deploying going forward. So we have said that on an analyst call and so we are seeing that level of cost reduction at the high end.

1093 THE CHAIRPERSON: Okay.

1094 MR. MEHR: And customers will benefit from that.

1095 THE CHAIRPERSON: Take note of that.

1096 Let me turn more formally to the next phase, although we've touched on it here and there. So is your plan for the rollout of the second phase on track?

1097 MR. MEHR: Yeah. We're largely on track. The training is in good shape. I wish we had all of our affiliate relations deals done, and we don't.

1098 THE CHAIRPERSON: But you are aware that the Commission offers mediation and the accompaniment for those -- there may not be a marriage encounter but we certainly can again, you know, help out.

1099 MR. MEHR: Yes, thank you.

1100 We are aware and we haven't been an extensive user of that service either on when we owned a media company or that ---

1101 THE CHAIRPERSON: It's free.

1102 MR. MEHR: --- it's free?

1103 THE CHAIRPERSON: Yes.

1104 MR. MEHR: Why, thank you.

1105 We are aware and we will work down that path and we know we have to get it done. We know we have to get it done.

1106 We do believe in commercial negotiations and have been a company that have been able to complete deals. But we understand what's available.

1107 THE CHAIRPERSON: Okay. And so is that the only obstacle that you foresee on the next phase, those wholesale agreements, or are there others?

1108 MR. MEHR: Yeah. And I don't think it's an obstacle in that we will -- we will meet the requirements and our suppliers understand that we will meet the requirements.

1109 We don't know exactly what price will meet the requirements at on a standalone basis but we will be delivering in the marketplace with standalone offerings from everybody.

1110 THE CHAIRPERSON: How far along are you on your thinking with respect to promotion of the new options? Do you have a strategy in place? Is it something that you feel relatively comfortable is, you know, not set in stone but well advanced enough?

1111 MR. MEHR: Yeah, we do. And to be clear, I think with the level of transformation we have had on our video packaging to date, this is a good thing for us and so we're excited about it.

1112 The trick with all of it will be just managing simplicity and the conversation and so lots of work have been done by Sarah and Katherine and the team.

1113 The conversation in the home about what channels you actually watch and in a pick and pay world for those customers who know, "I only watch these three channels", it becomes remarkably simple. It gets more complicated as you start to present other options.

1114 So a bunch of our work is around the simplicity of that. I'll leave it to the team to add.

1115 THE CHAIRPERSON: And I take it you are taking the same approach as you did and not necessarily training manuals in that sense, but a process and documentation?

1116 MR. MEHR: Yes.

1117 THE CHAIRPERSON: Have you drafted it yet?

1118 MR. MEHR: Yeah. We can share for Friday what we have today.

1119 THE CHAIRPERSON: Yeah. And if you wish to ask confidentiality because maybe implicit in it there is ---

1120 MR. MEHR: Right.

1121 THE CHAIRPERSON: --- sensitive information, you know how to do that. If you could undertake?

1122 UNDERTAKING

1123 MR. MEHR: We can.

1124 THE CHAIRPERSON: Thank you.

1125 And what about measures or whether maybe it's a continuation of measures you already use, if in fact there are consumer confusion, dissatisfaction, have you thought about how you would react -- I don't know if it's a tiger team or something that reacts quickly if in the next phase something goes in the wrong direction, how do you organize yourself around that?

1126 MR. MEHR: I think we have come down a ways in terms of thinking from a game perspective if X and Y and I think we are going to be extremely transparent in the public domain. What the concern will be, the sense that every customer is going to get everything they want and save money because I don't think that's going to find its way.

1127 To be clear, our customers are overwhelmingly spending less money when they switch to Limited TV with small packages today. In fact, to be clear, our customers are saving about 30 percent on what they are actually paying us on their video bill as they move to Limited TV. We, of course, have less programming costs. So it's not -- the profitability is less but not at that margin.

1128 It'll be interesting to see how many customers are in that one, two, three, four standalone services that will put them in a position where they will be able to get exactly what they want and pay quite a bit less than they are paying today if you pick 10 or 12 services on a standalone basis depending on what the services are. And I think the Commission is clear on this. I'm not sure Canadians are totally clear yet or that every Canadian is clear. They may not necessarily save money in that model.

1129 THE CHAIRPERSON: M'hm. No, it wasn't a universal. It was to provide people choice ---

1130 MR. MEHR: Yes.

1131 THE CHAIRPERSON: --- and that's their individual household-based decision.

1132 MR. MEHR: Yeah.

1133 THE CHAIRPERSON: Do you have any sense whether the fact that you were able to provide it limited TV and later on pick and pay whether that has had a -- I'm not sure it's a positive or a negative. It depends on your perspective, but an effect on the reduction of the number of cord cutters? In other words, it might be -- they may not be providing you as much revenue as a previous customer or even their own behaviour. But you're better off having them in some way than not at all?

1134 MR. MEHR: Absolutely. Limited TV has worked. It's worked with cord cutters. It's worked with cord nevers and it's worked with our base.

1135 It's very surprising to me wide-open Internet 150, our top Internet product, over indexes with Limited TV, so a higher percentage of Limited TV customers are taking Internet 150, our high-speed Internet product, than of our overall base.

1136 THE CHAIRPERSON: And this was surprising to you?

1137 MR. MEHR: Yes. Because we thought originally that the immediate appeal of Limited TV would be to a value customer. We weren't sure it would appeal to cord nevers and cord cutters.

1138 THE CHAIRPERSON: Right.

1139 MR. MEHR: But it absolutely does, and that's a data point that indicates that.

1140 THE CHAIRPERSON: Because of streaming services that are also available, don't you think?

1141 MR. MEHR: Yeah. Yeah, for sure. Although you can stream services for a lot less than 150 so it ---

1142 THE CHAIRPERSON: M'hm.

1143 MR. MEHR: -- again, it's a good news story; right? And for sure, Limited TV has worked. It provides customers value. It provides customers to our base with value and certainly opens it up to cord cutters and cord nevers which is terrific.

1144 THE CHAIRPERSON: And to be clear, will standalone services be available to all of your subscribers, all your customers regardless of what packages they chose, if they were to also choose a package?

1145 MS. TAKAHASHI: Sorry. Can I request a clarification? Do you mean all the individual pick and pays?

1146 THE CHAIRPERSON: Yes.

1147 MS. TAKAHASHI: Yes.

1148 THE CHAIRPERSON: Even if you had a package you could still do ---

1149 MS. TAKAHASHI: Yes.

1150 THE CHAIRPERSON: --- limitless amount of pick and pay on top of that?

1151 MS. TAKASHASHI: Right.

1152 THE CHAIRPERSON: There will be no restrictions?

1153 MS. TAKASHASHI: That's correct.

1154 MR. MEHR: Yeah, except where we have linked services where a multicultural service is linked to something that in order to take this service you have to take that service like some of the ATNs and so forth.

1155 THE CHAIRPERSON: Okay.

1156 MR. MEHR: And some of the sports.
Except where specifically prohibited you can get to anything.

1157 MS. TAKASHAHSI: M'hm. Anything that's available on a pick and pay basis, yes.

1158 THE CHAIRPERSON: Where it's otherwise authorized under the regulations, not by contract?

1159 MR. MEHR: Yes.

1160 THE CHAIRPERSON: Yes, okay.

1161 And I take it -- you have spoken about the benefit of allowing folks that choose all these different cable/video channels, they will continue to benefit from the bundling from your other lines of services; is that correct?

1162 MR. MEHR: Yeah, absolutely. It's a clear guiding principle, if you can bundle with video, you can bundle with Limited TV.

1163 THE CHAIRPERSON: Okay. And a final question, do you -- when we get to Phase 2 do you anticipate changes in the services you rolled out in March as a result of the way you are going to roll out your December services? Why say December? Let's say Phase 2 just in case you go before.

1164 MR. MEHR: Sure. We would like to not make changes into our March product offering. To be totally transparent, the things that are at risk is we have got to pick five product on Shaw Direct that may not meet the affiliate agreements that we end up agreeing to and then just the various sports packages might change a little bit. But yeah, we'd love to be able to continue off of the same services we offer today in the packages we offer.

1165 THE CHAIRPERSON: Right. But there is nothing you would, for instance, improve because of your experience with the first phase?

1166 MR. MEHR: Well, we'd certainly like Limited TV customers to have access to on demand services.

1167 THE CHAIRPERSON: Okay.

1168 MR. MEHR: Yeah.

1169 THE CHAIRPERSON: Understood.

1170 So I’m going to turn to my colleagues to see if there are questions.

1171 Commissioner Simpson, please.

1172 COMMISSIONER SIMPSON: Hi. A couple of clean-up questions for me.

1173 Could you help me revisit the option a customer has to return to their old package? Have you made it a policy that they can do this or is it when they jump off the dock and into the boat there’s no going back?

1174 MR. MEHR: Yeah, I’ll let Sanae fill in.

1175 As a guiding principle you can go back to any of products and services that are currently active, and the vast majority of our products and services are currently active.

1176 But maybe you can walk through specific examples.

1177 MS. TAKAHASHI: And maybe even Sarah. But as a general rule the philosophy is that we don’t -- it’s not a one-way street; however, there are very, very specific and very old permutations where a bit more of a I’ll call it holistic discussion should happen with that customer to understand what it is that they’re currently on versus what they would be moving to because moving back is actually not necessarily an easy process.

1178 I don’t believe there’s any specific examples where you absolutely can’t, but some of them are a little bit more onerous in terms of requiring other changes in your packaging.

1179 COMMISSIONER SIMPSON: M’hm.

1180 MS. MILLER: Exactly. And usually for those legacy packages there’s about a 30-day period where if you do change then we can do it relatively easily. And as Sanae mentioned for anything that’s currently available, that can happen in real time.

1181 COMMISSIONER SIMPSON: Yeah. Why I was asking, by the way, was not so much from a hard policy standpoint but you tipped into something I found very interesting because it changed my whole thought process from my discussion with Rogers earlier, and it had to do with the complexity of the billing system as it attaches to the distribution system. And I candidly hadn’t quite really thought about that complexity and I was trying to understand whether the billing issues have any impact on the ability to go back to an old package because of -- because of the backend system not supporting the frontend system, and that’s where I was going with that question.

1182 So on that theme, we had heard from Rogers that they have difficulty providing -- although they wanted to -- some discretionary product, but couldn’t for technical reasons. In your instance when you constructed your small basic you deliberately left a few things off the table. Was this for technical reason or for a business case reason? And as a follow-on; are there any discretionary products that you wanted to offer that you couldn’t due to technical reasons, be they technical through distribution issues or technical through billing issues?

1183 MR. MEHR: I didn’t follow the Rogers conversation because I hadn’t seen the paper back and forth. You know where we are?

1184 MR. SHAIKH: I think it was picking upon the discussion of VOD and apps and pay-per-view.

1185 Yes, certainly. There were, as we said in our remarks, a mixture of considerations; regulatory, technical, and business that led to our decision that the policy and its spirit was met by actually providing those services to limited TV customers.

1186 To be clear, those services are provided to limited TV customers, any limited TV customer who expresses a desire for more than simply the entry level experience. So it is principally the coding issue between Stingray and VOD that makes it very difficult to undo that offer.

1187 COMMISSIONER SIMPSON: Right.

1188 MR. SHAIKH: But absolutely at $30 and then suddenly everyone gets it, and it’s everyone who wants more than that entry level experience. Right now that’s close to 70 percent of our limited TV customers who actually get that experience and get VOD and the free apps.

1189 And it’s sort of consistent with the policy that at $25 you are getting a pure entry-level experience, if someone just wants that and doesn’t add discretionary services.

1190 COMMISSIONER SIMPSON: So if I could read into what you said a little further, this is one of the reasons why packages, whether they’re old, existing packages that were part of your incoming system or the new packaging that you were putting together to try to fulfil the spirit of small basic, these packages were easier to deliver to the customer because you were able to put them together as a whole, both as a product and as a billing service, and deliver it to a customer.

1191 So if that’s the case, what does the pick and pay scenario look for you -- or what does it look like for you?

1192 I guess what I want to try to understand is the DOCSIS system; it was never built for this kind of a delivery system, and is it particularly problematic for cable companies over IP companies to do what the future is asking of you?

1193 MR. SHAIKH: Yeah, and I don’t think the issue is necessarily the DOCSIS system. To be clear, billing is a major issue for all distributors.

1194 COMMISSIONER SIMPSON: Yeah.

1195 MR. SHAIKH: And we’ve had -- we actually thankfully received really our application from the commission for Shaw Direct because it was a billing issue that absolutely prevented us from doing the regionalized local over-the-air packages on satellite.

1196 COMMISSIONER SIMPSON: Right.

1197 MR. SHAIKH: And we made that case that it was essentially technically impossible because of billing issues and you granted us that relief.

1198 Similarly, you know, there is a team up here that has been involved in, you know, a large team of people working on the implementation of March and December and we’re all fully aware of the challenges in the billing system that needed to be overcome from March, and quite honestly still need to be overcome for December. We are on track to do that but give some credit to our customer care team, there’s a tremendous number of people who carry the work to overcome significant billing code challenges.

1199 MR. MEHR: Yeah, I think it’s fair to characterize the issues as more billing and being agnostic to cable and phone companies and not sort of underlying technology. I did enjoy -- one of my takeaways from today was the number of legacy wireless packages that exist because it’s going to be super fun to be a new entrant and not have to -- not to have to deal with any historical billing.

1200 COMMISSIONER SIMPSON: I can well imagine.

1201 Just wondering out loud as we look at December looming -- and this is a rhetorical question so no answer is necessary -- but when we talk about the complexity of the marketing of systems in the past which is -- seem to be a barrier to understanding for a lot of consumers, I can’t help but wonder what the pick and pay environment is going to look like where there isn’t that psychological comfort of getting a bill for $120 a month and just simply glancing at it and knowing that, “Oh, there it is, there’s the Shaw bill.” But all of a sudden finding it very highly variable because of a pick and pay potential. You know, I know my own experiences with some services we use, you know, causes my bill to be $40 one month, 120 the next and it brings about a feeling on my side of the fence that it’s going to have to cause all of the distributors to amp up their communication and perhaps understanding of the nature of the billing in the future so that you don’t get a lot of comeback from your customers in looking for clarification on each individual expenditure.

1202 MR. MEHR: Yeah, for sure. And you’ve correctly identified change drives billing calls and a bunch of changes so that if you pick six channels right away and then call back and cancel two and add three, the way our billing works if you’re prorated daily, which is right, so you only pay for the days that you have, but if you have three or four months in a row where you make changes midmonth and have pro-rations over those three or four months, you’re going to have actually a different amount. It may only be different by a few pennies but you’re going to have a different amount on a month-over-month basis until you settle into a service without changes. So that’s something for all of us to manage.

1203 Look, it’s a good business that we’re in and it’s something for us to work our way through, but it will be part of the change process.

1204 COMMISSIONER SIMPSON: Right. Last question has to do with, again, that dreaded billing system.

1205 We had heard from Rogers again today that they are taking a very holistic view to their customer and looking at their loyalty as described by their overall volume of business in all the different plays that a customer can participate in with Rogers. Are you doing the same thing in looking at the ultimate -- you know, the total dynamic of the customer and adjusting your rewards for loyalty accordingly?

1206 MS. TAKAHASHI: Absolutely. We look at each household. We don’t view them as individual products. Certainly our ambition is to own the relationship with that particular household, and to the extent that we can provide the largest number of services that meet the requirements for that household overall, that’s certainly our ambition. So we very much take an overall view.

1207 COMMISSIONER SIMPSON: Okay, thanks. That’s it.

1208 THE CHAIRPERSON: Thank you very much. I don’t think lead counsel has any questions. No? So thank you very much for your appearance in this phase of the hearing. We’ll see you later. And I think we’ll take a break until 3 o’clock.

1209 Thank you.

1210 Sorry; I misspoke. I did my math wrong. Let’s do 2:35. Yes, that’s much better. We don’t need all this time. Sorry; I misread the clock.

1211 Thank you.

--- Upon recessing at 2:23 p.m./

--- Upon resuming at 2:43 p.m./

1212 LE PRÉSIDENT: À l’ordre s’il vous plaît. Order please.

1213 Madame la Secrétaire.

1214 THE SECRETARY: Thank you, Mr. Chairman.

1215 We will now proceed with Item 4 on the agenda, and the presentation by Bell Canada and Bell ExpressVu Inc., the general partner, and Bell Canada, the limited partner, carrying on business as Bell ExpressVu Limited Partnership.

1216 Please introduce yourselves and you will then have 20 minutes to make your presentation. Thank you.

PRESENTATION

1217 MR. MALCOLMSON: Thank you.

1218 Good afternoon, Mr. Chairman, Commissioners, and Commission Staff, my name is Robert Malcolmson and I'm Senior Vice-President of Regulatory Affairs for BCE. It's a pleasure to be here today and to introduce Bell's panel to you.

1219 To my right are my colleagues from Bell TV: Payal Gabrani-Bahl, Vice-President, Content. To Payal's right, Alex Hum, Director of Content; and next to Alex is Shawn Omstead, Vice-President, Products and Services.

1220 And to my left are my Regulatory colleagues: Kevin Goldstein, Vice-President, Content and Distribution; and Lenore Gibson, Senior Counsel.

1221 We will now begin our opening remarks.

1222 Bell TV is proud to provide BDU services to consumers across Canada via our two BDU platforms: Satellite TV, our national DTH service, and Fibe TV, our regional IPTV distributor serving Ontario, Quebec and the Atlantic provinces. All told, we provide BDU services to 2.7 million subscribers across the country and hold four BDU licences.

1223 Launched in September 1997, Satellite TV helped introduce competition into the cable television market with innovative "theme packs" as an alternative to traditional large cable tiers.

1224 Twelve years later, in July 2009, we introduced Fibe TV to Canadians, bringing significant innovation and competitive choice to the BDU marketplace. Today, Fibe TV is the fastest growing BDU in Canada and has been the recipient of multiple awards. It was the TV service most recommended by consumers in 2015 and has won awards for its mobile app and the design of its slim remote.

1225 With the introduction of Fibe TV, as well as the launch of other IPTV services across the country, a competitive terrestrial BDU market in urban areas has finally begun to develop, with Canadians benefitting from the innovation, choice and quality that robust competition brings.

1226 Our Fibe TV product offers technologically advanced features and functionality unmatched by cable and satellite providers. Features such as "Restart", which enables customers to rewind and watch TV shows already in progress from the beginning, and "Look Back", which allows viewers to go back in time to watch shows that aired in the previous 30 hours, were unheard of just a couple years ago.

1227 More packaging choice and flexibility is offered to our Fibe TV subscribers through their ability to access Netflix and Crave TV directly on their set‑top boxes. All of these features are available to every Fibe TV customer, regardless of their programming package subscription.

1228 Mr. Chairman, Commissioners, it is clear that the launch of the new small basic service alongside standalone channels and/or small packages last March has initially been a challenge, given that the Commission's new policies were a fundamental change to the broadcasting system.

1229 All stakeholders have had to adjust. Many of the interventions filed in this proceeding relate to issues common to all BDUs, and not just the ones who are appearing before you at this hearing, making the issues being discussed here today collective ones that affect the entire distribution sector.

1230 That said, the end goal, to provide consumers with increased choice, has been satisfied and we are glad for the opportunity to play our part. At Bell, we have made every effort to minimize marketplace confusion by launching both standalone and small packages from the outset. We were the only BDU to do so, and we continue to evolve our service offerings to better serve our customers.

1231 For example, on July 19th, we announced that Bell Aliant's FibeOp TV in Atlantic Canada would be integrated with the Bell Fibe TV service available in Ontario and Québec, giving Bell Aliant customers more 4K and on‑demand content, and our exclusive Fibe TV features such as Restart.

1232 And yesterday, we announced that by the end of Q1 2017, Fibe TV will be available to all Canadians -- to all customers without having to subscribe to Bell Internet, just as we do today in Atlantic Canada.

1233 In our remarks that follow, we will discuss the manner in which we have implemented and promoted both the small basic service and flexible packaging options for discretionary services as well as how we handle discounts for our customers. We will also indicate what, if any, conditions apply to the purchase of these packages.

1234 Payal?

1235 MS. GABRANI-BAHL: Our new small basic service –- we have branded it as Starter -– contains all the required channels pursuant to the BDU Regulations. With respect to the optional services that may be included in the small basic service, the U.S. 4+1 stations have been included since June 20th. This information was provided in our June 23rd filing but not reflected in the Commission's document comparing the small basic package and its pricing across several BDUs.

1236 Specific to Satellite TV, we distribute additional local television stations in Starter to comply with our conditions of licence. This requirement was placed on us as a part of the Commission's approval of our acquisition of CTV in 2011. We offer Starter to consumers at the cost of $24.95 per month with a separate charge for the set‑top box as permitted by the Commission's policy.

1237 With respect to our small basic service, we firmly believe that our Starter package delivers great value for a certain segment of the population. Notably, subscribers to Fibe TV's small basic service are provided with the exact same premium features and functionalities that are provided to other Fibe TV customers.

1238 We mentioned "Restart" and "Look Back" earlier. Subscribers also receive access to:

1239 "Trending", which highlights the five most-watched shows through our Fibe TV platform at any given time and allows viewers to watch them live. Video-on‑demand services. The Fibe TV app, the first of its kind in the world, which recreates the full Fibe TV experience on any screen, with access to the channels you subscribe to, while more than 500 can be accessed either on‑demand or on the go. Quick access to Netflix and CraveTV and the Fibe TV 4K Whole Home PVR, the most advanced in the market.

1240 At the same time that we launched the small basic service, we also introduced the flexible packaging options for discretionary services. With this new packaging, consumers have more choice than ever before.

1241 All discretionary services have been made available on a stand-alone basis. To meet the small pack requirement, the vast majority of these services may be taken as part of a custom pack:

1242 In Québec, we now offer subscribers the ability to select English and French-language channels in a custom pack of 10, in addition to the packs of 15 and 30, which previously existed, while in the rest of Canada, we offer a custom pack of 10.

1243 Within Québec, premium movie services are available in theme packs while premium sports services are available in custom packs. Outside of Québec, both these types of services are available in small theme packs.

1244 Third-language channels are available to be selected in a custom pack of four. This allows consumers to now subscribe to services in a variety of languages in addition to still being able to choose multiple theme packs.

1245 And we also continue to offer our larger pre-assembled packages, Good, Better and Best, as permitted by the Regulations.

1246 As we have already implemented both the stand-alone and small basic service requirements, we have only one minor change to make in order to fully comply with the December 1^st deadline established by the Commission. This is to make a few non‑premium sports services available in a small package. These services are currently only available on a stand-alone basis.

1247 MS. GIBSON: With respect to promotion, both the small basic service and our flexible packaging options are promoted through a variety of methods to consumers, online, on the phone, and in our stores. These access points are how consumers may purchase our other pre‑assembled packages as well. This promotional strategy has been in place since we launched the new packaging.

1248 We have attached to the back of our opening statement a screen shot from our website as well as the retail collateral that is placed in our stores. You will see from these that we are promoting the availability of the small basic service in the same manner that we do our other packaging tiers.

1249 The Commission has also asked parties to this proceeding to discuss any additional conditions that apply to consumers' purchase of the small basic service and discretionary services. This is an admittedly complex area.

1250 Our written submission indicated that there were no television bundling discounts provided to small basic subscribers but did not specifically address what other promotions these subscribers are entitled to receive. In fact, they are eligible to receive many discounts, including promotions on certain programming services such as many of our premium movie services and multicultural channels as well as a $150 rebate on installation fees with a two-year contract.

1251 With respect to discretionary services, we confirm that there are no additional terms, costs, or limitations that apply to the purchase of discretionary services by our subscribers.

1252 MR. MALCOLMSON: Currently, we all enjoy a robustly competitive broadcast distribution market with multiple regulated and unregulated platforms from which to choose. IPTV has made significant progress in creating a competitive dynamic for subscribers. Ultimately, it is consumers who reap the rewards from higher IPTV penetration and increased BDU competition.

1253 In closing, we wish to reiterate that we are fully compliant with the Commission's requirements for the small basic service and flexible packaging options. We are pleased to have been the first BDU to offer the most choice to Canadians by implementing all the new packaging options from the outset.

1254 Thank you for the opportunity to share our views and we’d be happy to answer your questions.

1255 THE CHAIRPERSON: Thank you very much for your presentation. Commission MacDonald will start us off.

1256 COMMISSIONER MacDONALD: Good afternoon.

1257 Just before I get started, I took note of the press release that you alluded to earlier today that was issued yesterday, and that obviously changed some of the questions that I wanted to ask with respect to tying the requirement to have internet service to a cable bundle. So interesting timing, but thank you for issuing that is that will save some questions. That said, the press release also raises some other questions that I have.

1258 But to start off I want to focus not on what's coming but what's in market today, focusing predominantly around awareness, promotions and training of your staff. Then I want to get a firm grasp on what is available from a price and in service standpoint in the market today. And then last, I said I’ve got some questions with respect to yesterday’s press release.

1259 With respect to awareness, we also received an intervention form PIAC, and they expressed some concern with respect to the fact that only about 50 percent of Canadians are currently aware of the basic television service. And I'm wondering if you could enlighten us as to how that level of awareness would relate to the awareness that the general public would have of other products that Bell may have in the market.

1260 When you're launching a new product, what level of either customer awareness or potential future customer awareness are you striving for?

1261 MR. MALCOLMSON: Thanks, Commissioner MacDonald. I’ll start and I’ll ask Payal as well to contribute.

1262 You asked what level of awareness we strive for in terms of any product offering. In a perfect world we’d strive for 100 percent awareness. In the case of PIAC’s characterization of a level of awareness, perhaps you're referring to the survey evidence that they submitted. Without spending a lot of time on it, we do share some of the concerns that other -- others who have appeared before you had about that survey in the sense that of the sample of 4,000 people if my memory serves, I think roughly 88 identified as Bell customers, so a small sample size and potentially, you know, not very reliable.

1263 But on the issue of awareness, we think that there is a high level of awareness of the new packaging options, of the starter package and the flexible packaging options. We think the Commission certainly made the Canadian public well aware repeatedly of the availability of those options. And, you know, we made those options available as we were obligated to do. And Payal can take you through how in fact we promoted them, where we made them -- made customers aware of them and how we’ve done that on an ongoing basis.

1264 COMMISSIONER MacDONALD: In your conversations with -- I guess perhaps conversations with your customers, conversations that your CSRs have had, would you say that the general level of awareness among your potential customers or future customers that call in to enquire about service is on par with -- or on par with or above the level of awareness that the general public may have of your internet packages or your other television bundles or the other services that you offer?

1265 MS. GABRANI-BAHL: What I would say is, you know, a lot of our internet packages and the other television packages that we have in market, have been in market for a substantially longer time since March, so if we’re comparing awareness levels, the time in market definitely impacts that. I think, you know, we have definitely tried to promote the starter package on our website along with all of our other packages, as well as in our retail collateral along with all the other packages as well.

1266 COMMISSIONER MacDONALD: And for my own education, how do you -- how do you measure that? Do you measure it by number of calls that you have coming in to your call centre requesting a specific service? Do you do polling? Do you do focus groups? Do you judge it based on the number of inquiries you receive, complaints you receive?

1267 MS. GABRANI-BAHL: We have what I would say, you know, high-level market research surveys that we conduct, you know, throughout the year, which speak to awareness level of Bell’s overall products and services.

1268 COMMISSIONER MacDONALD: Do you do any such surveys with respect to the basic television service, or is that reserved for -- such surveys are reserved for other products that you have in market?

1269 MS. GABRANI-BAHL: They're reserved for what I would say lines of businesses, so we ask for awareness levels of just overall TV and internet.

1270 COMMISSIONER MacDONALD: And what are you doing with respect to promotion of the basic service? I take note of the screen shots that you provided, what beyond that? One can hardly drive down the street without seeing the Bell logo on a billboard or receiving a dropped piece of mail. So perhaps you can enlighten us as to what other promotions you're doing beyond having it on your website or a board in one of your stores?

1271 MS. GABRANI-BAHL: Yeah. So as I mentioned, it is on the website, it’s retail collateral, in all of the stores there's actually dedicated pieces just to starter and our “à la carte” packaging options within all of our retail channels. It's also in our self serve tools, so any existing customer who has a TV service with us who -- and has access to the self serve tool, they can go in and see all of the “à la carte” options that are available, as well as the starter options that are available as well. And obviously, we have trained all of our CSRs.

1272 COMMISSIONER MacDONALD: Obviously you need to make business decisions with respect to what new service you're promoting versus what you're not promoting. One would assume that you spend more money leading up to a launch and shortly following a launch to build up excitement for a new service, and then over the product life cycle that tends to peter off. Did you do such promotion at the outset of the skinny basic package, similar to what you would for another product that you're bringing to market?

1273 MS. GABRANI-BAHL: No. So I would say, you know, even when we introduced our existing TV packages in market that we have right now -- I think it was in 2012 -- there wasn’t a lot of lead up to unveil a new lineup. We find that customers tend to do a lot of research on the website, and leveraging that tool really does help kind of educate customers on what our products and services are.

1274 COMMISSIONER MacDONALD: So would you say it would be fair that you target your fundraising dollars more based on the platform of the service? I'm from New-Brunswick, so you see a lot of -- where you did see a lot of fiber TV or fiber to the home promotion versus a specific package. Is that how you tend to target those dollars?

1275 MS. GABRANI-BAHL: Yes.

1276 COMMISSIONER MacDONALD: And what tool have you found to be most effective? There's word of mouth, there's social media, there's print ads, print publications, mail drops. What vehicle gets you the biggest bang for your investment?

1277 MS. GABRANI-BAHL: I think overall the website does provide an invaluable tool for customers, because many customers do use the website to research their options across carriers prior to making a purchasing decision.

1278 COMMISSIONER MacDONALD: When you first introduced the basic TV service at -- when the other providers did as well, did that require any changes in your internal processes that you had to -- had to build, be it from a billing standpoint, be it from a promotion standpoint, what internal work was required when that package was originally launched?

1279 MS. GABRANI-BAHL: Sure. I can speak high level and perhaps Alex can provide some additional details. It was a highly complex project and it did touch all of the various cross functional teams across the organization, as well as our billing platforms -- provision platforms and ordering tools.

1280 MR. HUM: So as some of the other BDUs actually have mentioned as well, it is a complex project that we had to take on. Literally almost every aspect of -- whether or not it was our billing systems, our customer provision, the websites, obviously we had thousands of reps that we also had to train. So it was an extensive project that literally as soon as decisions were made, that we kicked off the project. So it was a long, long journey.

1281 COMMISSIONER MacDONALD: And we’re six months into that at this point, so what lessons have you learned and what changes have you made to your basic offering that you didn't come to the table with out of the gate.

1282 I know in your comments earlier you mentioned the addition of the 4+1 U.S. channels. What else have you done from a pricing or a position standpoint?

1283 MS. GABRANI-BAHL: So we have -- as you mentioned, we have included the U.S. 4+1s on a permanent basis into the Starter package. We have also made some pricing changes to the à la carte 10 package, as well as to many of the à la carte packaging as well. Sorry, as to many of the à la carte prices as well, channels as well.

1284 COMMISSIONER MacDONALD: And what have those changes entailed? Has it been price reductions for à la carte channels? Has it been -- as I'm looking at what you submitted today -- is it moving certain channels from the $7 a month per channel grouping into the $4 a month per channel grouping? What's happened?

1285 MS. GABRANI-BAHL: Yes, there have been prices reductions on the custom 10 pack as well as a reduction on the à la carte channels from the $7 to the $4.

1286 COMMISSIONER MacDONALD: So if you had to put a percent -- a rough, high level percentage on it, there's been 10‑percent changes to channel shuffling around, 20‑percent? Has it been more significant than that, based on customer demands?

1287 MS. GABRANI-BAHL: Yes, I would say around 10 to 15‑percent.

1288 COMMISSIONER MacDONALD: Okay.

1289 When you have to make changes like that or changes to your other products, obviously you need to get your customer reps up to speed.

1290 Can you at a high-level outline for me what's required from a training and an information dissemination standpoint what you need to do for a simple change, like Spark is now available for $4 versus $7 versus something that would be more significant like the introduction of the basic package, for example?

1291 MS. GABRANI-BAHL: So for something like the introduction of basic, it's -- and as well as all of the à la carte packaging and small packs that we had launched, that was obviously more of a larger training exercise that went across all of our sales force nationally across all of our channels. That involves a variety of different training methods, including kind of classroom setting videos online, as well as, you know, a host of kind of real live customer, not customer but training interactions that would -- that the CSRs go through.

1292 For a small change such as a pricing change, we would send out a communication to all of our reps as well as update all of their reference materials as well as their online portal and make sure that all of the leaders of those CSRs were aware of the changes that are happening. Because we do do kind of smaller training sessions throughout the week with the leader and the agents.

1293 COMMISSIONER MacDONALD: So just so I understand. For something more significant you would either get people in a room or get them to hop on a webinar to fully explain all the aspects of the service. For something more simple, it could be an email going out, or a new piece of literature that they're responsible for updating themselves on?

1294 MS. GABRANI-BAHL: Yeah, and I would say for something more significant, obviously the time involved in the training is obviously much longer.

1295 COMMISSIONER MacDONALD: In the basket of what's significant, was the launch of the basic TV service considered significant from a training standpoint?

1296 MS. GABRANI-BAHL: Yes, it was.

1297 COMMISSIONER MacDONALD: A few months back, I think in February, there was a report by CBC that customer service representatives, or at least employees of Bell, told CBC that they were told to downplay the basic service, and I'm wondering if you can comment, confirm, or refute what actually happened?

1298 I understand that yours is a large organization, so there's a certain amount of he said/she said, but can you speak to the content of that CBC article?

1299 MR. MALCOLMSON: Yes, Commissioner MacDonald, I'd be delighted if I could refute the report.

1300 But there was what I would call an unfortunate incident in the early stages of training the CSRs in Atlantic Canada, it didn't extend across our footprint, where some training materials were not accurately reflective of our obligation to promote.

1301 Those materials were leaked or provided publicly. We -- as soon as we learned about them we immediately took them out of play. The fortunate part of that unfortunate incident is that those materials were never operationalized, they were never used by CSRs when the products were launched, and the lesson we learned from that was -- and this is -- Payal is new to this position, so Payal wasn't around when that happened ---

1302 COMMISSIONER MacDONALD: Congratulations on your new position.

--- (LAUGHTER)

1303 COMMISSIONER MacDONALD: The lesson we learned from that, and obviously, it was a disappointment for our customers, was a need to centralize our training and to elevate our training to more senior employees so that we could have a uniform system, a failsafe system, a system that complied with regulatory requirements and one that was monitored.

1304 And Payal can take you through what we've learned and how we've implemented those lessons.

1305 MS. GABRANI-BAHL: Yes, so as Rob mentioned, it was isolated to a small percentage of our national sales force, and we have taken steps now to actually centralize all of our training and communications for new launches. So it will be managed out of one team nationally and these types of regional variances won't occur anymore.

1306 We've also executed and implemented internal vetting processes whereby all of our internal stakeholders will be reviewing the training documentation, including our regulatory team, as well as director-level approval will be required prior to any training materials being released to our agents.

1307 COMMISSIONER MacDONALD: So thank you for that because that helps to provide some context around the changes you've made to your internal process to ensure that such communications don't go out to your staff in the future.

1308 Would it be possible for you to provide the Commission with a copy of what goes out to your customer reps and to your sales teams with respect to the basic television service offering so we can vet that obviously that those changes have happened? And if you can provide that by end of day this Friday? I guess 8 o'clock Eastern, 5 o'clock Vancouver.

1309 MR. MALCOLMSON: Yes, Commissioner MacDonald.

1310 COMMISSIONER MacDONALD: Perfect, thank you.

1311 MR. MALCOLMSON: And it may be accompanied by a request for confidentiality, but we'll deal with that as it comes.

1312 COMMISSIONER MacDONALD: Understood.

1313 UNDERTAKING

1314 COMMISSIONER MacDONALD: Regarding the various different programming options, as you're set up today, and you can let me know if things are changing in Q1 of next year following your press release of yesterday, but under the current scenario, if people make changes to their package, say if they adopt the basic TV package or they're changing their various different programming package options, and then they don't like the change, are they able to revert back to the plan that they were previously on?

1315 MS. GABRANI-BAHL: Yes, for customers who are on active in‑market plans, they can move back to those at any time and they can do so without having to talk to a CSR. They can make all of those changes through the self-serve tool.

1316 COMMISSIONER MacDONALD: So they can revert back to the actual service. Are they able to revert back to the pricing that was offered before if they were on either an active plan or a grandfathered plan that they may not have understood the implications of changing?

1317 MS. GABRANI-BAHL: For grandfathered plans, I believe they could, and if that is definitely the best solution for a customer, we do have a way to put them back on those plans. For an in‑market plan, like an active plan where the pricing does change frequently, I believe that they would be given the existing rate.

1318 COMMISSIONER MacDONALD: Is there any grace period there? They're allowed to go back and get their old rates if they, I don't want to say port back but switch back to their previous offering within 30 days, within 60 days?

1319 MS. GABRANI-BAHL: I'm actually going to let Alex talk to that.

1320 MR. HUM: No, in terms of timing, if someone wants to switch from one of the plans, to your point, if they wanted to try something out 30 days after they chose to go back to the original plan, again, as Payal mentioned, if it's one of our in‑market active plans they can make those changes as often or as frequently as they want. They can go up and/or down.

1321 COMMISSIONER MacDONALD: And that's done purely on a web portal? They don't need to ---

1322 MR. HUM: Yeah.

1323 COMMISSIONER MacDONALD: --- call anyone?

1324 MR. HUM: No, they can do it completely self-serve.

1325 COMMISSIONER MacDONALD: We heard from Rogers earlier today, and they were talking about how changes such as that require the live interaction, either in a store or with a -- with one of their customer service representatives, and they claim that that allowed them to talk the customer through the implications of the changes that they were going to make.

1326 Is anything lost in your process due to the lack of personal information -- personal contact, because I assume whatever portal they are going in to make those changes, the end-customer, there is no -- there's no flag that pops up that says this is going to increase a certain rate by $5.00 or $10.00 a month or that you'll be moving off of perhaps a very attractive grandfather plan.

1327 MS. GABRANI-BAHL: So what I would say is the customer decision tends to be more iterative versus going in and then making a unilateral decision just on the portal. There tends to be discussion with the CSRs.

1328 So customers tend to call a CSR, ask for information, research their options and then go and make kind of the change through the -- through a channel that they feel most comfortable in, whether that's going to a retail store, talking to a CSR, or doing it through an online self-served portal.

1329 So I would say, you know, the vast majority of our transactions still happen through the call centre, but we do provide for those customers who are, you know, very engaged and knowledgeable about their services to make -- take those decisions and make the changes themselves.

1330 COMMISSIONER MacDONALD: Are there any penalties for -- perhaps you don't penalize people when they go into a more expensive option or buy additional services. Do you penalize them if they are taking something away and, thus, reducing their total monthly recurring charge?

1331 MS. GABRANI-BAHL: So in terms of penalties like fees or ---

1332 COMMISSIONER MacDONALD: Additional fees either on a monthly basis or a one-time basis that you might levy if a -- if say I decided to cancel a sports package on my current television service?

1333 MS. GABRANI-BAHL: No, we wouldn't levy any one-time fees for changing a package, for downgrading a package.

1334 COMMISSIONER MacDONALD: Okay. Do you do any trial periods for customers wishing to try out the basic television service? Try it for 30 days and if it doesn't meet your needs, you can come back without penalty or without problem?

1335 MS. GABRANI-BAHL: No. Because we already allow our customers to change their packages whenever they want and through kind of any channel that they want to, I don't think there is really the need for a trial period. So a customer who comes in on day one and wants to purchase Starter and then on day 25 wants to give it up or on day 45 wants to give it up, they can do that and go and choose whatever best meets their needs at that point.

1336 COMMISSIONER MacDONALD: Some individuals and other interveners have perhaps raised a concern with respect to Bell's overall interest in transitioning or signing up people to the basic service, preferring to keep customers on a more robust package.

1337 Out of curiousity, does Bell have any internal win-back promotions for customers that you have lost perhaps to another subscriber that they are -- the other company's basic service might have been more attractive to them for whatever reason? Do you actually go out and target those lost customers to bring them back to your own basic service?

1338 MS. GABRANI-BAHL: What I would say is, you know, we have a variety of different marketing campaigns going in market and giving time targeting a variety of different segments. So we would definitely try and, if we have lost a customer to the competition, we would definitely try and win that customer back.

1339 COMMISSIONER MacDONALD: Do you have any incentives that you are able to or choose to offer before a customer moves away to another basic service?

1340 We often hear that when a customer -- I'm not speaking just with respect to Bell. I am speaking in general if a customer calls and they are not happy and they want to downgrade or move away and all of a sudden there are various different offers or better packages or incentives that can be offered to that customer to entice them to stay. Is there anything within Bell, within the Bell toolkit that entices your current basic customers to stay with you?

1341 MS. GABRANI-BAHL: What I would say is, you know, if customers call in and, you know, they are unhappy with their services we would try and, you know, find whatever solutions we can to best meet their needs and to prevent them from obviously leaving.

1342 COMMISSIONER MacDONALD: Okay. So with respect to pricing as it exists today, in your original intervention you indicated that TV bundling was available but then you didn't offer any bundled discounts with those other non-TV services. Is that -- is that a correct understanding? You required them to take Internet but could they avail of any discounts if they took Internet or took phone service or subscribed to Crave or so forth?

1343 MS. GABRANI-BAHL: So there currently aren't any bundle discounts available for Internet or home phone. So for any new customer coming in and taking Internet and home phone package, there is no bundling of discounts available for anybody, not just our customers.

1344 COMMISSIONER MacDONALD: And just to clarify that, you said today that there are promotions though if they want to subscribe to such a service. Could you ---

1345 MS. GABRANI-BAHL: Yes.

1346 COMMISSIONER MacDONALD: --- tell us what such promotions are available and what the magnitude of those incentives look like?

1347 MS. GABRANI-BAHL: Sure. There are several promotions in the market that starter customers are eligible for. The first one is we have a promotion available on installations.

1348 So any TV subscriber who is willing to sign a two-year term commitment can get $150 off of the initial installation cost, as well as we offer a premier movies promotion for any new subscriber coming in whether they are on starter or any of our larger pre-assembled packages. So that would be a two months free promotion on any of the premier movie service theme packs of their choice, so the value of those definitely range. They can be anywhere from, I believe, $15 to like $37.

1349 As well as we offer a multicultural promotion as well. So for any customer including starter customers, anybody who is taking one of our multicultural combo packs or theme packs, is eligible for a two month free promotion as well.

1350 COMMISSIONER MacDONALD: So what's the rationale for not offering bundle discounts when the basic television service is part of that bundle?

1351 MS. GABRANI-BAHL: There are certain discounts and promotional offers that we have in market that are the eligibility criteria for them are based on higher levels of service or higher tiers of service.

1352 COMMISSIONER MacDONALD: So can you give me an idea of how those would rank or what percentage pricing incentive they may be able to get if they have a basic service in relation to what they could get if they were subscribing to your good or better or best cable product? Because I am thinking as a millennial I may not want to watch a lot of television so skinny basic may be perfect for me but I may stream almost constantly and require your top tier Internet package but there doesn't seem to be any incentive for me to take that top tier package versus something that would be more middle-of-the-road from a financial standpoint.

1353 MS. GABRANI-BAHL: Yeah, and just to clarify, you are asking about the offer that would be available on the top tier Internet package?

1354 COMMISSIONER MacDONALD: As an example.

1355 MS. GABRANI-BAHL: Yeah. So for the Internet example, as I said, we don't actually offer bundle discounts to any Internet subscribers regardless of their TV package. There are, you know, special offers such as we have an unlimited usage as that bundled customers can get a discounted rate for which starter customers would be eligible for.

1356 So I think what's kind of -- what can be kind of confusing the situation is we don't -- we don't have a bundle program in its historical sense whereby you buy two products you get 5 percent off, you buy three products you get 10 percent off. There is no standardized formula for that. We do offer, as I said, a variety of different offers and promotions in market. Each of them have separate eligibility criteria associated with them and many of them, the starter customer base could avail themselves of.

1357 COMMISSIONER MacDONALD: And what they can avail themselves on is that -- I think I just heard you say per market? So it is not available to all of your subscribers across the country? Is that accurate, the promotion that may be available to people living in Halifax may be very different to the promotion that's available to people living in Ontario?

1358 MS. GABRANI-BAHL: Yeah, so typically promotional pricing activity is very unique by market because there are different competitive dynamics at play in each market.

1359 COMMISSIONER MacDONALD: I'm going to read one of the interventions that we received and it's from one of your customers. I just want to get your thoughts on why Bell put this structure into place. I confess I have never designed a cable package before and how, when you pull one Jenga cube out of the tower how obviously it has a ripple effect and everything may no longer support it. But from this Bell customer in Quebec they stated that:

1360 “We have internet, telephone and TV with Bell. Yesterday I called to inquire about the skinny basic $25 package. They said that if I chose that service my telephone bill will increase by $20 a month and my internet bill will increase by $30 a month. I find it abusive that my wife and I want to cut our costs and if I choose to cancel one of our services (TV) the other services will increase so much that it will make my bill higher than having the TV package itself.” (As read)

1361 Help me understand how that can be possible. I fully understand volume discounting. I understand that there are synergies and efficiencies with having one subscriber in a household buying multiple services that can be provisioned over the same piece of fibre or piece of copper going into a home. But help me understand how that pricing logic works.

1362 MS. GABRANI-BAHL: You know, that specific example where you’re mentioning where I believe you said the internet service is going up by $30 and the home phone service is going up by $20, without knowing a little bit more specifics around the customer’s account profile, you know, I would say that CSR if they called in should have actually done a better job. To my knowledge, if a customer chooses to take starter I’m not aware of a situation where, you know, your home phone and your internet pricing would be going up to such a degree.

1363 So, as I said, there are certain -- I fully admit that there are certain promotional offers that are linked to the higher TV packages, but, you know, without knowing specifics around that specific customer situation, you know, I can say that the CSR probably should have done a better job at articulating what options there are for that customer.

1364 COMMISSIONER MacDONALD: So do you see that based on -- or would you agree that based on what product a customer may be on or a certain mix of products, are you saying that based on moving from good, better, or best television down to the basic television service that there would be scenarios out there whereby someone’s bill would actually go up even if they weren’t getting into all of the additional speciality and à la carte channels?

1365 MS. GABRANI-BAHL: Their bill at a household level?

1366 COMMISSIONER MacDONALD: Household level.

1367 MS. GABRANI-BAHL: There could be scenarios where, you know, if -- yeah, there could be scenarios I guess if a customer had, you know -- and I’m trying to do the mental math in my head to say, you know, if this is possible. But there could be scenarios whereby if the customer is downgrading their package and also not optimizing the other products at the same time that they could be walking away.

1368 COMMISSIONER MacDONALD: It can sometimes be difficult to figure out how all that will work just based on the limited information that’s on a website. So would it be possible to take that away and run a few of the different scenarios whereby that could be the case and then undertake to provide that to us?

1369 MS. GABRANI-BAHL: So specifically -- like right now our website actually does provide a dynamic calculator for customers coming in. So once they enter the ViFlow and they start making their selections of, you know, what internet package they have or what home phone package they want to subscribe to, or whatever TV packages they would like to subscribe to, there is a dynamic calculator there that tells them their ongoing monthly rate would be this, their promotional price would be this, and their one-time fees would be this. So that option is available to customers.

1370 COMMISSIONER MacDONALD: Is that calculator sophisticated enough to be able to go in and retrieve a customer’s information and know that Chris MacDonald is on a grandfathered plan that is 25 percent less expensive than what the advertised rate would be today?

1371 MS. GABRANI-BAHL: So I think -- so there’s the website which deals with it for new customers, and then there is the self-serve portal which existing customers can go through. And the key promotions are not listed there but if there is something that they would be losing there is notifications that do inform the customer to call a CSR agent at that point.

1372 COMMISSIONER MacDONALD: So the notification is to call a CSR it’s not you’re going to lose some package named whatever and doesn’t explain what the ---

1373 MS. GABRANI-BAHL: Yeah, that there ---

1374 COMMISSIONER MacDONALD: --- results are? A live individual does that?

1375 MS. GABRANI-BAHL: That there are further implications to the decision that you’re making, that for further information because there are implications to the decision that you’re making to call a CSR.

1376 COMMISSIONER MacDONALD: That’s a notification. Can the end customer override that and say “I don’t want to make the call I just want to place the order for my service changes”?

1377 MS. GABRANI-BAHL: I believe they can.

1378 COMMISSIONER MacDONALD: They can override. Okay.

1379 So I noticed a couple of months after you launched the basic service you included the U.S. stations, the four-plus-one. What was the rationale for that decision after the launch versus the beginning of the launch?

1380 MS. GABRANI-BAHL: So we had originally included the four-plus-ones on a free preview when we initially launched prior to the March timeframe. So we did find that based on having been in market for a few months that, you know, customer response to the package was positive, and that based on market dynamics that it would make sense to include the U.S. four-plus-ones on a permanent basis. So they were available to all customers from the time that we started -- from the time that we launched starter.

1381 COMMISSIONER MacDONALD: Available for a fee?

1382 MS. GABRANI-BAHL: No, they were included in the package.

1383 COMMISSIONER MacDONALD: Okay. So you based the automatic conclusion based on how many individuals you saw were automatically availing of those four-plus-one channels?

1384 MS. GABRANI-BAHL: What I would say is based on the market dynamics at the time we felt that it was the right approach to take to include the U.S. networks on a permanent basis. As I said, they were included on a free preview basis when we first launched.

1385 COMMISSIONER MacDONALD: And that’s included across your service territories now for Fibe?

1386 MS. GABRANI-BAHL: Yes.

1387 COMMISSIONER MacDONALD: And what about

1388 ---

1389 MS. GABRANI-BAHL: And satellite as well.

1390 COMMISSIONER MacDONALD: So it is included on DTH now as well?

1391 MS. GABRANI-BAHL: Yes, it is.

1392 COMMISSIONER MacDONALD: Okay.

1393 With respect to equipment, customer premises equipment, we see the price of a lot of equipment going down, price of DVD players, stereos, televisions, that sort of thing. Can you speak to what, if any, decreases in pricing the BDUs currently enjoy with respect to favourable rates year-over-year with respect to the equipment that you have to deploy out there and then in turn sell or lease to the end user?

1394 MR. MALCOLMSON: We’ll give Payal a rest, Commissioner MacDonald, and I’ll ask Mr. Omstead, who is our equipment expert, to take you through that.

1395 MR. OMSTEAD: So, Commissioner MacDonald, we haven’t seen price decreases on the hardware side simply because we keep on investing in our next generation platform. And as part of that, as our TV service evolves, there are new services out there like 4K, larger recording capacity that’s necessary, as well as just next gen technology that we want to have in terms of processing power in the set top boxes.

1396 So if we stuck on the same platform all the time we stuck on old generation technology and stopped investing, you’d see the price curb go down of older generation boxes, but because we continue to invest in new services like 4K, enhanced recording capacity and just faster boxes as the service evolves. We haven’t seen a decrease in our pricing on set top boxes because we just continue to invest all the time in the hardware.

1397 COMMISSIONER MacDONALD: And I get that for new customers who are buying a more robust service. What about the existing customers who have the set top box that may have been sitting out there for three, four, or five years at this point, do you have a program that you automatically go back and refresh those every two years and that’s absorbing the money, or are they only replaced when there’s an outage or an incident of some kind?

1398 MR. OMSTEAD: So we do offer our customers the option of purchasing the set top boxes. The majority of our customers prefer a rental model. We offer what’s called a rental choice plan. As part of that plan we do cover the full warranty of the box over the duration of the rental choice period. That is a $7 a month fee that we charge the end consumer.

1399 And as part of that, you know, the majority -- the vast majority of our customers prefer that rental model over a purchase of the set top box. And with that they have some guarantee that if they do have an issue with the box, we do cover that. If they're four years in, we're going to replace that box, and actually upgrade them to the latest technology of whatever box that we make available at that time, even if it is a newer generation box.

1400 COMMISSIONER MacDONALD: How much competition is there in that market from a hardware provider standpoint? Are you able to shop around for a less expensive option? Bell's a very large company, very large buying power. Are you able to leverage that in any way?

1401 MR. OMSTEAD: Absolutely. As part of being a next generation IPTV platform, we have the benefit of actually, you know, putting tenders in the market that attract many bidders for our business. Bell is a large player in the TV market of set‑top boxes, so we do attract more than our fair share, I would say more than the cable industry attracts. So we have a lot of providers of our set‑top box's technology that can provide us with, you know, whether it's a PVR or HD box.

1402 COMMISSIONER MacDONALD: But those cost efficiencies aren't passed on to the customer. Your argument, they're being invested back in the network?

1403 MR. OMSTEAD: I'm saying there's not cost efficiencies as we invest in newer technology, faster boxes, bigger hard drives, 4K, because you know, the consumer is still on a path where, you know, TVs being sold at retail today are primarily, you know, moving towards 4K, and as part of that, they want to pair that with a next generation set‑top box. So although the cost of maybe a HD PVR is starting to go down, it's that next generation that we're now on of, you know, providing a 4K PVR instead of just a regular PVR box to the customer.

1404 COMMISSIONER MacDONALD: So ---

1405 MR. MALCOLMSON: Commissioner MacDonald ---

1406 COMMISSIONER MacDONALD: Yeah.

1407 MR. MALCOLMSON: --- I should just add that, you know, the discussion you're having around the cost of equipment and being able to leverage purchasing power is but one component of our IPTV platform. You know, unlike cable, we're in the process of building an entirely new platform, fibre platform through our IPTV product.

1408 So you know, there's the equipment piece but there's also the build out of fibre to the home, which in and of itself requires significant investment. So lots of moving parts, entirely new network, which requires continuous investment.

1409 And Shawn may just want to give you a little bit of context on the overall state of investment in what is entirely a new network.

1410 COMMISSIONER MacDONALD: And I can appreciate that a lot of investment is going on with respect to fibre to the home, and other platforms, but one of the things we're also concerned about is the movement in prices.

1411 And what I was trying to get to is at least from a PVR set‑top box perspective, there have been no efficiencies found or rates reduced with respect to an end customer buying or renting those units at least since the basic TV package was brought in. Would that be correct?

1412 MR. OMSTEAD: That's correct.

1413 COMMISSIONER MacDONALD: Okay.

1414 So I read your press release that came out yesterday, and I do have some questions around that specifically.

1415 And the -- I guess the first one would be if one, not me, if one were to take a bit of a cynical view, it's somewhat surprising that that would come out hours before we start the oral phase of the hearing. If some were to take a generous view, this is part of a longer-term plan.

1416 So I'm just wondering if you can inform us as to why now with respect to some of the improvements that you're proposing to have in place by the end of Q1 next year?

1417 MR. MALCOLMSON: Sure, so, you know, the press release yesterday relating to the delinking of the Internet subscription from the TV subscription is really part of an ongoing alignment of our -- of the features of our service across our footprint.

1418 And as you will certainly recall, in Atlantic Canada, before Bell owned 100‑percent of Aliant, Aliant was the forerunner in launching the fibre footprint. So they were in the market long before Bell came along, long before Bell acquired 100‑percent, and they went out into the market with -- offering Internet and TV separately.

1419 When we launched Fibe TV in Ontario and Quebec, we did the opposite. We linked the Internet and TV subscriptions, and so the idea of when we take a look at it, and it is still relatively early days, we decided to align the product across the board. Just as there were certain features that were initially available in Ontario and Quebec that we mentioned in our presentation today that weren't available in Atlantic Canada.

1420 So in July of this year, we extended those features to Atlantic Canada, and yesterday we made the decision to delink Internet. And the decision -- so the decision is part of an ongoing process, and you know, the issue was on the table at the hearing.

1421 It certainly wasn't, from a consumer perspective, we weren't getting voluminous complaints about the linkage of TV and Internet. There were a few. Customers were in fact seeing the value of taking Internet and TV. Customers are flocking to the Fibe TV service.

1422 So from a consumer standpoint, we're, you know, happy with the way it's proceeded. We've delinked the two to give customers even more flexibility for that subset of customers that might want it, and hopefully, it also contributes to some regulatory certainty. So it was all of those factors that went into it.

1423 COMMISSIONER MacDONALD: So this wasn't solely the result of losing large amounts of subscribers to other service providers that were offering the basic service without linking it to an Internet service?

1424 MR. MALCOLMSON: No, not at all. In fact, as I said, our customers seemed to embrace the value of buying multiple products, and so no.

1425 COMMISSIONER MacDONALD: What needed to technically happen to make those changes? Because in your original intervention from May the 5^th of this year, and I'll paraphrase, but you explained that to do this would require significant software changes to both the set‑top box, the residential gateway management system before your service, your television service could operate without an Internet connection.

1426 That was only four months ago, and market research, installation of equipment, approval of business cases, four months doesn't seem like a very long time to go from it's a very significant change to we're ready to announce the change.

1427 MR. MALCOLMSON: You're right, it is a significant change. There are a number of IT challenges associated with implementing the change.

1428 I'll ask Shawn in a second to speak to those, but those were laid out in our intervention and they're real, they exist, and that's in fact why when we made the announcement yesterday we stated that that change would be made by the end of Q1 2017. It does require a fair bit of IT lead time, some investment, and Shawn can walk you through what's required, but it is, internally, a substantive operational change.

1429 COMMISSIONER MacDONALD: And I would like to understand those changes.

1430 MR. OMSTEAD: Sure.

1431 So I think very similar to the comments I've heard from some of the others that presented before us, there are a number of system changes that go into any new product or any change in products that we need to make in‑market. Everything from, you know, the way we do billing and the way we do tracking of the Internet side of the service and kind of decoupling the Internet from the fibe service.

1432 So I'd say over the four months we've been looking at how we do that and how we not only come to, you know, make those changes and write requirements around those changes, but you can appreciate that from time to time we do have what we call IT releases during the year. Those are not, you know, frequent in nature per se.

1433 So we have to kind of, along with all the other priorities of our business, slot in at the right time when we can make those changes. Those changes we believe we can make by the end of Q1 2017.

1434 So I'd say over the last four months we've figured out how to make those changes. We've now prioritized those changes and we will make those changes by the end of Q1 2017.

1435 COMMISSIONER MacDONALD: With significant change usually comes significant cost. Who's going to bear the brunt of those costs? Is that going to be funded internally from Bell's resources or is the gap going to be made up by taking certain incentives away from other products that customers currently enjoy?

1436 MR. MALCOLMSON: You're right, with change comes cost, and we recognize that there is a level of investment required. In terms of the consumer side of the equation, you know, pricing is dictated by marketplace dynamics. We're operating in a highly competitive BDU market.

1437 As Payal mentioned after the launch of our small basic and flexible packaging and à la carte in March, and then we went out into the market with certain pricing and due to competitive dynamics that pricing on some of those products has come down.

1438 So the retail pricing component is more a function of what's happening vis-à-vis our competitors. We'll make the internal investment and we'll seek to obtain a return on it but the market is what's disciplining pricing.

1439 COMMISSIONER MacDONALD: With respect to the questions that I have that stem from yesterday's press release and the untying of television service with Internet, it did raise some questions that weren't fully addressed. But since the press release has gone out, I assume you have an idea of your current plan and what needs to happen over the next few months. But if any information is commercially sensitive, you can file it with the Commission in confidence.

1440 Is that unbundling, untying of the two services going to apply to all of your television products; basic, good, better and best or is it just going to apply to your more higher end packages?

1441 MR. MALCOLMSON: It will apply to all television products, so starter, good, better, best.

1442 COMMISSIONER MacDONALD: Okay. And will that be available across your entire service area that currently has access to Fibe TV?

1443 MR. MALCOLMSON: Yes.

1444 COMMISSIONER MacDONALD: Okay.

1445 From an internal standpoint, are there any changes with respect to how customers are prioritized or will be prioritized if they take a basic package? I'm wondering specifically things like needing time to repair or time to get on to speak with a customer service representative or to report an issue. Is there any special cueing or triage that takes place to repair someone who is spending $300 a month with you versus someone who is spending $25 on the basic package?

1446 MS. GABRANI-BAHL: No, there isn't. The way we triage calls into the call centre is largely based on type of calls. So whether a customer is calling in for repair for billing or to get customer service on any of their other products, we direct the call to the appropriate call centre agent in that regard. There is no triaging -- sorry -- there is no triaging of customers based on their spend.

1447 COMMISSIONER MacDONALD: And with this change do you anticipate any pricing changes in, let's say, the next six months with respect to the basic service either from a monthly or an install or equipment rental standpoint based on the untying of these two services?

1448 MS. GABRANI-BAHL: Just to clarify the question, you are asking specifically if there are any planned changes for install or set-top box pricing?

1449 COMMISSIONER MacDONALD: The monthly recurring rates for the basic television service, install rate -- install cost for the basic service or any applicable rental charges because on a monthly basis the $25 a month is the most you can charge. Many of your competitors are charging significantly less in some cases.

1450 MS. GABRANI-BAHL: So we're constantly assessing -- assessing the market and are ready to take any pricing decisions based on competitive market forces. So we are constantly assessing the environment and are ready to make changes as needed.

1451 COMMISSIONER MacDONALD: Will future skinny basic television customers after this Q1 change, still be able to -- will they be able to avail if they do decide to purchase multiple services, will they still be able to avail of the lowest advertised rate for all of your various Internet bundles and/or telephone for that matter or is there going to be an incremental increase elsewhere in what a customer may choose to purchase?

1452 MR. MALCOLMSON: If I understand your question, if you are a small basic subscriber and you also choose four months from now to be an Internet subscriber of Bell's you would be treated like any other Internet subscriber for whatever particular package of Internet subscription?

1453 COMMISSIONER MacDONALD: Will I get the rate that's advertised on the website versus, well, no, you need actually to avail of that discount to avail of that promotional rate you actually need a more robust television package?

1454 I just want to make sure that moving forward after these changes happen that Internet customers or phone customers that are purchasing multiple services from you aren't penalized in any way by being on the basic package versus one of the more robust television packages that you offer.

1455 MR. MALCOLMSON: That's certainly not the intention, to penalize our customers. No.

1456 COMMISSIONER MacDONALD: Okay. Can you for a minute explain to me how you build and price your various discretionary services, either on an à la carte or -- I'm looking for the paper -- either on an à la carte or on a small bundled basis? How do you arrive at the -- as I'm looking at the paperwork you provided today, the $4 per month rate for these discretionary services versus $7 a month for other or up to $15 a month?

1457 MR. MALCOLMSON: I'll ask Payal to take you through the details in a minute but I would like to point out that we were the only BDU to launch the full gamut of programming flexibility from day one, so we launched starter and we launched flexible packaging and we offered all services on an à la carte basis.

1458 When we did that that was not without risk to us because in many instances the programming services, in particular some of the U.S. discretionary programming services that weren't entirely enamoured of the prospect of being offered on an à la carte basis were not -- we didn't have deals in place with them.

1459 So we went out to market with à la carte pricing without necessarily knowing what our costs would be. And we did that in order to implement our policy from day one, minimize customer confusion and not have to have a staged implementation process. So there was certainly some risk at the beginning of the process.

1460 In terms of how we price the packages, I'll ask Payal to walk you through that.

1461 COMMISSIONER MacDONALD: I appreciate that and I take that point. And since you are first into the game that means that we can learn from you in that regard with best practices. So it wasn't -- don't take that as a slight in any way. This is an educational exercise on my part.

1462 MS. GABRANI-BAHL: So just speaking high level and say the à la carte pricing is dictated by the same forces that most other or any other pricing is, which would be you know, consumer demand, costs as well as competitive market dynamics.

1463 COMMISSIONER MacDONALD: Is there a particular multiple that's applied across the board with respect to what you would be paying for the service versus what you would be charging an end-customer? Do you charge 50 percent more than you would pay; 100 percent more?

1464 MR. MALCOLMSON: There's no formula, no. A number of factors we have to look at, what the programming network is seeking to obtain from us by way of a wholesale rate, what sort of assurances the programming network is looking for in terms of penetration. This is a new world for the programming services as well. So really it's -- and then we have to look at the cost of actually provide the service to the customer. Some of that is our network cost, our investment in fibre. So it's all of those factors.

1465 There is no formula that says, you know, on Family Channel you have to get a multiple of X. That's not the way it's developed, if that answers your question.

1466 COMMISSIONER MacDONALD: It does. Thank you.

1467 Since you were early in the game, you launched before December the 1st, has there been any customer feedback that you feel would be important to share with us with respect to launching earlier or perhaps developing those relationships south of the border, making them understand the new rules of engagement in Canada? Is there any benefit, any information that you would like to share with respect to that?

1468 MR. MALCOLMSON: I'll start. Payal may have additional comments.

1469 Certainly getting -- doing it from the outset I think, you know, it represented a sea change for the way we sold television, and it did minimize consumer confusion because it took one of a number of changes away and implemented it -- implemented those changes at the same time, so I think that benefited consumers.

1470 When -- in terms of the relationships with programming services, and you mentioned the U.S. ones, as did I, you know, it’s -- you know, it just makes for harder negotiations because they’re seeking to protect their downside risk. You know, they’re used to days when they thought they would get 75 percent penetration and now they’re facing sharing the risk of declining penetration as we move to a pick and pay model. So the fact that we’ve started those discussions early, I guess, benefits everybody, and the discussions started early and hopefully we’ll all successfully complete those discussions.

1471 So starting early was a good thing from a negotiating standpoint and a good thing from a consumer standpoint, and there have been some hiccups in the road but it’s a new process.

1472 MEMBER MacDONALD: And I can see that probably also provided you with a bit of a strategic advantage versus some of your other competitors that weren’t offering that flexibility as early in the year as you were.

1473 Out of curiosity, are there any plans to remind your customers with ongoing outreach that these rules are in effect, you’re doing it today; you know, here are the ways that Bell is trying to be better and more nimble with respect to the packaging or à la carte options that you’re putting forward?

1474 MS. GABRANI-BAHL: Yeah, I think as we mentioned before we have all of the packaging, including all the à la carte channels as well as all of our small packs available on our Web site. In our retail stores we’ve trained our entire national sales force on all of the options. So I think, you know, most of the customer outreach actually happens organically through all of the customer interactions that we have through our retail locations or call centres.

1475 COMMISSIONER MacDONALD: Okay, thank you.

1476 Just one final question before I hand you back over to my colleagues who may also have some questions.

1477 Apart from this proceeding, we’ve submitted an application for change of control of MTS, and I’m wondering how you intend to operate this undertaking. Is it your intention to invest in a line with Bell Fibe’s approach that you’re taking elsewhere in the country?

1478 MR. MALCOLMSON: Well, that application is in front of you and hasn’t been processed yet so the record isn’t complete sort of at the frontend of that process.

1479 But with that caveat, I think certainly over time our intention would be to harmonize, where we can, the MTS offering. And certainly we plan to make a significant investment in Manitoba when we do that, just as we have with Fibe elsewhere. But that’s if we’re fortunate to receive the various approvals that are required.

1480 COMMISSIONER MacDONALD: Okay. Thank you. Those are my questions.

1481 THE CHAIRPERSON: Now, Commissioner MacDonald was asking you about the press coverage about what might or might not have been in your training documentation. Would it be possible for you to share what was in the final version so we can at least see the direction you were going in at the time when it was finalized?

1482 MR. MALCOLMSON: Are you -- sorry, Mr. Chair; are you asking for us to file ---

1483 THE CHAIRPERSON: Yes.

1484 MR. MALCOLMSON: --- the -- no, I just want to make sure I understand what you’re asking us to file.

1485 THE CHAIRPERSON: Yeah.

1486 MR. MALCOLMSON: Are you asking us to file the corrected training manual?

1487 THE CHAIRPERSON: Well, the one you were actually using.

1488 MR. MALCOLMSON: The one that had ---

1489 THE CHAIRPERSON: Are you suggesting that the one that got the press coverage was actually a version that was being used and got corrected?

1490 MR. MALCOLMSON: It was a version that was developed but was never used.

1491 THE CHAIRPERSON: Okay. So if it was never used, it was never used. So what was the version that was used is, I guess, more the pertinent point here, that’s all.

1492 MR. MALCOLMSON: If you would like us to file ---

1493 THE CHAIRPERSON: Yes.

1494 MR. MALCOLMSON: --- the current ---

1495 THE CHAIRPERSON: Just to provide you an opportunity to correct the record, does it not?

1496 MR. MALCOLMSON: Yeah. I’m -- we’re happy to file the current version that was and is used to train our CSRs.

1497 THE CHAIRPERSON: Okay.

1498 MR. MALCOLMSON: We would like to file that in confidence, and we’ll make a request ---

1499 THE CHAIRPERSON: Sure.

1500 MR. MALCOLMSON: --- as we file it.

1501 THE CHAIRPERSON: Sure. But I -- it was merely for an opportunity for you to be able to make the point actually which one was actually being used at the time and is now as well. That’s all.

1502 MR. MALCOLMSON: Yes, Mr. Chair. We will file that one, and we appreciate that opportunity.

1503 THE CHAIRPERSON: Thank you.

1504 Legal counsel?

1505 MR. GAGNON: Yes, thank you, Mr. Chairman.

1506 I just want to align the undertakings with the other parties that have come before us today. A few undertakings, I believe, have not been requested yet from B.C.

1507 One of these undertakings would be to also obtain the -- I don’t know if they’re -- those are different documents or not but the CSR training documents, but in that case with respect to the flexible packaging. As I said, I don’t know if those are different documents or not.

1508 UNDERTAKING

1509 MR. GAGNON: Also, I think the Commission has requested from others the strategy or plans respecting the implementation of pick and pay.

1510 MR. MALCOLMSON: Just on that one, we’ve implemented pick and pay so ---

1511 MR. GAGNON: Well, I guess that would target, then, the time remaining from now to 1^st December. Would there be anything different in there, or would that be useful at all?

1512 MR. MALCOLMSON: There won’t be anything different.

1513 MR. GAGNON: I think we’ve requested retail prices for channels, all the discretionary services. Would that be an undertaking?

1514 MR. MALCOLMSON: Because we’ve implemented the full range of pick and pay, all of that pricing is available. We’d initially, I think, filed it confidentially but it’s available on our Web site so we’ve filed it already and it’s publicly available.

1515 MR. GAGNON: Have you also filed the affiliation agreements when they were completed or...?

1516 MR. MALCOLMSON: We file all of our affiliation agreements as required so they’re on file with the Commission.

1517 MR. GAGNON: Okay. Thank you.

1518 That's all, Mr. Chairman.

1519 THE CHAIRPERSON: Thank you. Thank you very much. Those are our questions and I think we’ll adjourn until 9 o’clock, I believe, tomorrow morning.

1520 THE SECRETARY: Yes, Mr. Chairman, that’s correct.

1521 THE CHAIRPERSON: Yes, okay, thank you. I was just looking for the -- yeah, so 9 o’clock. Donc un ajournement jusqu’à 9 heures demain matin.

1522 Merci.

--- Upon adjourning at 4:00 p.m.

REPORTERS

Sean Prouse

Dale Waterman

Mathieu Philippe

Nadia Rainville

Lyne Charbonneau

Marie Rainville

Patricia Cantle

Lise Baril

Jacqueline Clark

Janice Gingras

Suzanne Jobb

Karen Pare

Date modified:

2016-09-07