Application comes after CRTC also said Rogers can’t change Corus channel numbers
By Ahmad Hathout
The CRTC ruled in a confidential decision last month that Rogers must continue carrying certain Corus channels and refrain from altering their channel numbers, even after the cable giant obtained an Ontario court opinion allowing it to make unilateral changes under its carriage agreements, according to new documents filed by Rogers at the Federal Court of Appeal Thursday.
The CRTC’s rulings on November 18 and 29 resulted from a confidential application filed by Rogers earlier this year that sought to have the CRTC lift a standstill and allow it to remove certain Corus channels – namely, Slice, Food Network Canada and HGTV Canada (the three channels) – from some television packages.
The decisions are being made public only because of the appeal court application, which alleges the CRTC is effectively rewriting the parties’ contractual terms by preventing Rogers from removing the channels while simultaneously allowing Corus to make changes to said channels. Those changes relate to Corus’s rebranding of Food Network to “Flavour,” HGTV to “Home,” and associated programming changes, such as Slice losing Bravo content owned by NBCUniversal, which was scooped up by Rogers in a rights deal this summer that included Warner Bros. Discovery’s Food Network and HGTV trademarks.
“Requiring Rogers to ‘freeze’ its carriage, packaging, and payment of Corus’ services—while allowing Corus to materially change the channels’ branding and content—would be a one-sided application of the standstill in Corus’s favour,” Rogers says in its memorandum seeking a hearing at the high court.
“The Commission found that it had the power to prevent Rogers from exercising key rights under these agreements, and to relieve Corus as a programmer of performing key obligations. As a result, the Commission is forcing Rogers to maintain a contractual relationship it has already terminated, on terms it never agreed to,” Rogers added, referring to a June notice to Corus that it was going to terminate their agreements by the end of the year, paving the way to remove the channels.
Rogers says it asked the CRTC in a letter four days after the November 18 decision, which froze its ability to remove the Corus channels, to confirm that the standstill rule did not apply to the three channels because Corus was making changes to them. Without a standstill, Rogers says it would stop carrying the channels at the conclusion of the agreements on December 31, 2024, the day after which Rogers’s newly purchased food and home content rights kick in.
The CRTC said in response to Rogers’s letter on November 29, which constitutes the second decision, that the standstill would remain in effect even with Corus’s branding and content changes, according to the court application.
Rogers challenges the decisions’ use of the Broadcasting Act’s section 15.01(1) – the standstill rule – which requires parties in a commercial conflict to maintain the status quo “on the same terms and conditions as it did before the dispute” until a resolution is reached. Forcing Rogers to freeze movement on the Corus channels while allowing Corus – bound by carriage obligations – to alter those channels runs afoul of the standstill rule, Rogers argues to the high court.
Rogers says the regulator’s decision is made more baffling considering it came weeks after the Ontario Superior Court ruled that same November that Rogers has the right to repackage Corus channels based on a reading of their carriage agreement – though the court didn’t step into the CRTC’s standstill territory.
“The Commission’s decision had no regard for Rogers’ bargained-for rights, which Rogers and Corus negotiated with open eyes,” Rogers says in its court application. The CRTC “did not consider, much less apply, governing principles of statutory interpretation. It did not cite any authority to support its view. It did not properly reckon with the Superior Court’s determination of Rogers’ rights. And it exceeded its authority,” it said, noting that the two CRTC decisions were very brief.
“If left to stand, these decisions will confer on the Commission the ability to upend contracts between sophisticated commercial actors under the guise of dispute resolution,” it added. “They will enable the Commission to compel an indefinite, non-consensual contractual relationship between Rogers and Corus for services that Rogers no longer wishes to carry. And they will result in unprecedented intrusion into the business of television distributors like Rogers, to the detriment of their consumers.”
When asked for comment, Rogers deferred to its application.
In response to the court application, a Corus spokesperson told Cartt that, “Rogers’ basis for appeal appears weak to us and we expect the CRTC’s decisions and jurisdiction will be endorsed by the courts.
“This is about fair competition and the fact that the rules apply to everyone, including Rogers,” the Corus statement added. “We have every expectation that the regulator will enforce its decisions and assess penalties for breaches, as needed.”
Rogers cannot rejig Corus channel numbers
The CRTC also ruled in the second decision that Rogers is not allowed to change the channel numbers at which Corus’s Flavour and Home programs – launching December 30 – will reside during the standstill, according to Rogers’s court application. “The Commission’s decision on this issue is entirely unexplained, and in any event, wrong,” Rogers says. “There is no basis under the standstill rule to prohibit Rogers from changing the channel numbers of Corus’s services.”
Last week, the CRTC made public a Part 1 application dated November 8 and filed by Corus that alleges Rogers is deliberately giving its new Food Network and HGTV channels an undue preference by pushing down Corus’s Flavour and Home channels by more than 100 positions “on numerous systems” and away from related channels, thereby making it harder for Rogers subscribers to find them. Corus said it received notice from Rogers in late October about the realignments, which take effect on the day Corus’s newly branded food and home channels launch.
Rogers, which calls the application “baseless” and an attempt to interfere in its ability to make legitimate “customer-focused decisions,” said the realignments are needed to avoid confusion as its customers must expect to be able to go to those channel numbers and watch the Food Network and HGTV programming that has changed hands following the rights deal this summer – even though Corus says its channels have occupied those spots for “years.” Rogers adds it has been “mindful to minimize, to the greatest extent possible, the impact of the realignments on Corus” by minimizing the “variation” in the standard and high-definition placements of Corus’s new channels.
But Corus alleges the move is a “bait and switch.” Rogers’s “decision to change the channel positioning of Corus’ Food/Flavour and HGTV/Home services is clearly part of a coordinated strategy to imperil these services while promoting the new services that [Rogers Media] will operate under the Food and HGTV brands,” Corus’s application alleges, claiming its new services are similar to Rogers’s soon-to-launch channels. “[Rogers’s] plan is designed to mislead customers into thinking that the new [Rogers Media] channels will be the same as the existing Corus channels. However, they will not be the same because they will lack the most popular and exclusive Corus-owned Canadian lifestyle programming that drives the popularity of these services.”
Corus says these popular programs include company originals, such as Top Chef Canada, Island of Bryan, House of Ali, Chopped Canada, Wall of Chefs, and Scott’s Vacation House Rules, which will be on the new channels alongside other content the company said it has been actively acquiring.
Rogers says Corus’s argument that the channel swaps are designed to mislead “defies logic” because it’s Rogers that owns the exclusive rights to broadcast this WBD content. It’s Corus, Rogers alleges, that is trying to mislead customers by attempting to “pass off Home and Flavour as re-brands of HGTV and Food Network, and unjustly profit off of customer confusion.”
Corus is claiming that these changes would run afoul of two sections of the Broadcasting Act: section 9, which deals with undue preference/disadvantage; and section 10, which outlines that a programming service “shall be given comparable marketing support by the BDU as is given to similar or related services.”
Corus had asked the CRTC to stop Rogers – as it would in the second decision – from realigning the channels until the regulator decides on its application.
“This is another example of Rogers attempting to remove choice from Canadian viewers to benefit their own bottom line with blatant disregard for applicable rules,” Corus said in a statement to Cartt. “Aspects of the matter are still before the regulator, but we have received clear legal confirmation from them that after December 30, Flavour Network and Home Network must continue to be carried at the same places on the dial, and in the same Rogers packages, as HGTV Canada and Food Network Canada currently occupy. This also applies to Slice.”
Rogers acknowledged – as outlined in Corus’s application – that it told Canadian broadcasters not to characterize the Corus channels as rebrands of the WBD content, which it said could cause confusion and accelerate cord-cutting as customers flee to find the premium American programming. Rogers “was simply taking necessary action to protect the value of its significant investments,” it said, alluding to its ability to bring legal action in the event they don’t abide by its instruction.
In any event, Rogers says in its CRTC response that it has complied with all the rules allowing it to make the changes. It cites a 2004 decision by the CRTC that said: “provided a BDU has complied with the Regulations’ 60-day written notice requirement, the licensee would generally be permitted to make all reasonable channel realignments it deemed appropriate.”
Rogers also points to a 2020 CRTC decision – spawned from an undue preference complaint against the cable company by St. Andrews Community Channel – that said: “The Commission’s general approach not to regulate specific channel placement is even more valid today, in light of the various tools available for subscribers to find a specific channel – including [Rogers] Ignite TV’s remote control with voice-activated search capabilities – and of the various means of communications at the disposal of programming services to communicate with viewers.”
Rogers says this position by the regulator is even more relevant today because “a large portion” of its television subscriber base has moved to the Ignite IPTV platform, and “Corus now has access to a greater number of platforms for communicating with viewers about the new channel placements of Home and Flavour,” it says in its reply.
In August, Corus filed another Part 1 application alleging Rogers is abusing its “dominant position” by preferencing certain services over Corus’s – in particular how it displays Disney+, which Rogers does not own, over Corus’s Disney-themed channels. The objective, Corus alleges, is to imperil independents like itself.
Rogers called the complaint “baseless.”
“Sadly, Corus has not kept up with the demands of Canadians and is now looking for the regulator to protect their broken business model while we’re focused on meeting our customers’ changing viewing habits,” the company told Cartt’s sister publication, Broadcast Dialogue, at the time. “This baseless complaint is designed to prevent us from providing Canadians with the content they want on their platform of choice. They’re trying to force service providers to carry and our customers to pay for channels they no longer want to watch. They need to compete in a fair system and earn each customer, just like every other company.”
Rogers has previously indicated that the decline in viewership on children’s programming has significantly outpaced overall television viewership – an underperformance point it has said is one of the reasons it wants some of Corus’s channels removed. It had pointed to Numeris data that showed viewership of Corus’s four Disney-themed channels have seen a dramatic decline as families move to online streaming options.
But Corus has rebutted Rogers’s points on underperformance by pointing to data showing high audience numbers, including for its Slice channel, which was the subject of that Ontario Superior Court application in November.
Corus said Numeris data show Slice reaches nearly three times more Canadians every week versus Rogers’s new Bravo Canada channel (measured between September 2 and October 20, 2024) and has experienced a year-over-year growth of three per cent in overall average minute audience (AMA) and over 90 per cent more overall AMA compared to Rogers’s Bravo since its launch (measured between September 1 and October 20, 2024). But in a LinkedIn post, Rogers Media says its own Numeris data show that between September 2 and November 10, 2024, average minute audience among adults 25 to 54 years old in primetime is 24 per cent higher on Rogers Bravo and down 50 per cent on Slice in that 7 pm to 11 pm slot.
Losing its position in the TV rotation of the largest broadcaster would be a big blow to Corus. Mere weeks before Rogers won the American rights to brands it held, Corus had been granted regulatory relief from the CRTC on exceptional grounds because of its troubling financial condition.
