News

Canadian Regulators Twist Operators Arms

5/23/1999 8:00 PM Eastern

Vancouver, British Columbia -- Canada's cable-TV
operators will have to launch four new Canadian channels by Sept. 1, even if it means
dropping U.S. services.

So said domestic regulator the Canadian Radio-television
and Telecommunications Commission and federal Canadian heritage minister Sheila Copps.

To add insult to injury, both used last week's 42nd
annual Canadian Cable Television Association convention to deliver their warnings.

The CRTC's message came from Andrée Wylie, its vice
chair of broadcasting.

She pointed out that four licensed Canadian specialty
channels have yet to be given space on domestic cable TV: Star TV, Talk TV, Canadian
Learning Television and Report on Business Television.

Known in Canada as the "Four Orphans," these
services were licensed in 1996, along with nine others.

Because the foursome were awarded "digital-only"
licenses, there was no requirement that operators launch them until digital cable had
penetrated at least 15 percent of Canadian households.

However, the arrangement came with a catch: If the
penetration rate hadn't been reached by Sept. 1, 1999, Canadian systems would have to
find analog space for them instead.

With that date approaching and the penetration rate far
from assured, executives from Canada's top four MSOs -- Rogers Cablesystems Ltd.,
Shaw Communications Inc., Le Groupe Vidéotron Itée and Cogeco Cable Canada Inc. --
pleaded for more time during the convention's "Industry Report" session.

The operators said the CRTC's 15 percent yardstick is
arbitrary and unfair. "To say, 'There must be 15 percent, or we'll put them
on analog,' [will] utterly destroy the rationale for licensing them in the first
place," Rogers Communications Inc. president and CEO Ted Rogers said. "It
doesn't make sense."

However, Wylie appeared unmoved. "We can't
prevent them from saying what they want at their own convention," she chuckled
afterward. "But the regulations are there, and if they're not changed, they have
to be abided by."

Adding further pressure, Copps said she personally liked
Star TV, and all Canadian cable-TV companies should include it on their systems by
September. "I'm sure you can find a way to fit that on your dial," she
added.

Copps added that the Cable Public Affairs Channel --
Canada's version of C-SPAN -- should also be available in every house. Moving CPAC to
basic would require bumping other channels -- likely from the U.S. -- but Copps seemed
unconcerned.

CCTA convention chair Fred Wagman said the industry would
publicly blame the CRTC for any dropped U.S. channels.

"The commission is going to have to bear the
consequences of what that will be in the eyes of the consumer," Wagman added.

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