GATINEAU – CRTC chairman Konrad von Finckenstein told the Canadian Cable Systems Alliance and Telus on Monday that the two organizations need not fear Bell Media withholding its TV signals while the independent carriers continue to try to convince the broadcaster to alter its new wholesale carriage agreement.
As Cartt.ca first reported last week, a number of Canada’s independent TV distributors have balked at signing the new contract, which encompasses up to 30 Bell Media channels (including TSN, BNN, Comedy, MuchMusic, Discovery and so on) and have complained to the CRTC that the terms demanded by Canada’s largest broadcaster are unreasonable.
Insiders told Cartt.ca last week that Telus and the CCSA – along with EastLink, MTS and Cogeco Cable – believe the packaging and penetration terms Bell Media is demanding with its contract are too onerous, and that attempts to mediate the dispute privately and with CRTC staff have so far failed. Most involved believe this will get to final, binding arbitration early in the new year.
The independent BDUs feel that Bell Media is not abiding by the Code of Conduct set out by the Commission in the Vertical Integration policy decision in September. That code says, among other things, that a programmer should not in its agreements demand “minimum penetration or revenue levels that force distribution of a service on the basic tier or in a package that is inconsistent with the service’s theme or price point;” nor refuse “to make programming services available on a stand-alone basis.”
The non-vertically integrated carriers say Bell is demanding just that with its contract.
In letters to both Telus and the CCSA dated Monday, December 12, von Finckenstein writes, in effect, what he told Cartt.ca recently: “I want to be clear, the Code is in effect and members of the industry are to conduct themselves accordingly.”
The chairman goes on to draw their attention to paragraphs 99 and 105 of the vertical integration policy which say that pending the outcome of the still-ongoing vertical integration machinations (there were a dozen new proceedings which sprang forth from the September policy decision), terms of the old carriage contracts will continue to apply.
The policy passage, and von Finckenstein’s letter read:
99. In Broadcasting Regulatory Policy 2011-415, the Commission further determined that, pending the outcome of the current proceeding, the following practice would apply:
A programming undertaking that is in negotiations with a broadcasting distribution undertaking or the operator of an exempt distribution undertaking with respect to the terms of carriage of programming originated by the programming undertaking should continue to provide the distributor or operator with its programming services on the same terms and conditions as contained in the last agreement reached between the concerned undertakings.
A broadcasting distribution undertaking that is in negotiations with a programming undertaking with respect to the terms of carriage of programming originated by that programming undertaking should continue to distribute the programming services of that programming undertaking on the same terms and conditions as contained in the last agreement reached between the concerned undertakings.
105. Accordingly, before the end of the year, the Commission will issue a notice of consultation containing regulatory amendments to implement the standstill rule described above. The decisions reached in Broadcasting Regulatory Policy 2011-415 will remain in effect until these amendments are made.
“This is to ensure that services continue to be offered and continue to be distributed while negotiations are ongoing between programming services and distributors,” adds von Finckenstein’s letters.
“In addition to the new Vertical Integration Policy there are existing regulatory provisions that govern the relationship between programming services and distributors. One of those is the prohibition on the conferring of an undue preference or subjecting a person to an undue disadvantage. Should any party feel that this prohibition is being contravened they may file an application with the Commission. In addition, should parties be unable to reach an agreement on the distribution of a programming service they can apply to the Commission for dispute resolution and the Commission can order a standstill pending its resolution of the dispute.”
This won’t be the last letter sent on this file. We’ll keep following it closely.
