More details emerge in the previously confidential monthslong battle
By Ahmad Hathout
Corus and Rogers continue to butt heads over the CRTC’s standstill rule, with the former urging the Federal Court of Appeal to affirm it and the latter asking the regulator to lift it so it can shuffle Corus channels it no longer wants out of both its rotation and certain channel slots.
The result of the back and forth has unveiled more details in a carriage dispute that is now nearly two years old.
The latest development sees Corus requesting this month that the Federal Court of Appeal reject a December leave application by Rogers that asks the high court to allow it to argue that the CRTC erred when it ordered the cable giant in two separate November decisions to continue carrying in the same channel slots Corus’s Slice, Home Network, and Flavour Network (the three channels) until the companies come to an agreement or until the CRTC makes a decision on the carriage dispute.
Rogers has argued that the Broadcasting Act’s standstill rule – which requires the two companies to maintain the status quo on the same terms and conditions until the issue is resolved – does not apply when it wants to relocate channels or terminate their agreements, which Rogers told Corus it intended to do ahead of their set end date of December 31, 2024.
But the CRTC ruled in those confidential November decisions, according to Corus’s reply to the high court, that Rogers can’t terminate its agreement or repackage the channels because the standstill rule applies both to the parties’ underlying affiliation agreement and the agreement on how that programming is distributed.
“The Commission is of the view that Rogers’ interpretation of the rule is overly restrictive,” the CRTC said in the November 18 decision, according to Corus’s application. “The phrase ‘terms and conditions’ as used in the rule should be interpreted broadly, and should include conditions such as those relating to the carriage, packaging and sale of programming services. The mere fact that the standstill rule does not explicitly mention the term ‘packaging’ or its synonyms such as ‘combination’ or ‘package’ cannot be construed as an exclusion.”
The rulings mean Rogers hasn’t been able to move or remove the Corus channels.
To Corus, if the CRTC intended to limit the standstill to just the affiliation agreement, then it would have made that explicit, it writes to the high court. “Indeed, other dispute resolution provisions in the BD Regulations specifically refer to a ‘commercial agreement’ between the parties. Similarly, s. 9.1(1)(j) of the Broadcasting Act speaks of the ‘terms and conditions of service in contracts between distribution undertakings and their subscribers.’ The fact that s. 15.01(1) does not use similar language is telling.”
The media company also said the CRTC has interpreted the standstill holistically with the objectives of the Broadcasting Act as intended by Parliament.
A second issue for Rogers is that it alleges the CRTC is unevenly applying the standstill rule by forcing it to carry the Corus channels and in the same channel slots while allowing Corus to make programming and branding changes to said channels. Those changes include the loss of Bravo content that went on Slice and the rebranding to Home and Flavour from HGTV and Food, which is the result of Rogers buying those American rights in the summer.
The CRTC has determined that the “services will continue to operate under the same discretionary service licences and will still offer programming under the same theme/genre,” according to the regulator’s November 29 decision, cited in Corus’s application. “There is no limitation in the licences or in the policy framework that prevents a service from changing its programming offering,” the CRTC decision continued, according to Corus’s application.
In fact, Corus says the its newly branded networks include many Food Network and HGTV series of which it said it has retained the trailing rights to air.
That November 29 decision came in response to Rogers asking the CRTC, following its first decision on November 18, to determine that the standstill doesn’t apply to the three channels because of the changes being made to them.
Corus argues that Rogers’s leave to appeal application must fail because that type of filing addresses specific questions of law or jurisdiction, which it said is not captured by this particular issue. Instead, it alleges, this is a challenge to a finding of fact, which it said is reserved for judicial review applications.
In any event, Corus says to grant this argument to Rogers would create an untenable situation because it was created by its own hands. It says these changes to its programming had to be done because it lost rights purchased by the cable giant.
“If Rogers’ position were correct, it would mean that a vertically integrated BDU in a dispute with a [programming undertaking] could self-engineer a way out of the Standstill Rule by the simple expedient of using its market power to lure the underlying programming rights away from the [programming undertaking’s content suppliers],” Corus argues.
Finally, Corus argues, in simple terms and contrary to Rogers’s position, that the standstill rule does apply to channel reassignments because it’s contemplated in the terms and conditions on which programming services are distributed.
Rogers answers Part 1 on channel change complaint
Meanwhile, Rogers has submitted its reply, made public Tuesday, to a Part 1 application that Corus filed to the CRTC on November 8 that looks into the channel relocation dispute specifically.
Corus is asking the CRTC to stop Rogers from moving its Home and Flavour channels down more than 100 positions on the dial, which it said would make it harder for Rogers subscribers to see the channel. The gist of the argument is as follows: Rogers is allegedly giving itself an undue preference by proposing to move its newly branded HGTV and Food Network channels in the slots currently occupied by Corus’s Home and Flavour channels, which it says have substantially similar programming.
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.”
But, beside giving Corus the requisite 60 days notice about the realignment, Rogers argues section 10 of the Wholesale Code does not encompass changes to such reassignments because there is allegedly no evidence to support that such an issue is encompassed in “marketing support.”
“In fact, the Commission’s longstanding approach to not regulate channel placement – with the exception of the notice requirements set out in s.15.3 of the BD Regulations – strongly supports the view that channel realignments are not subject to s.10 or any other section in the Code,” Rogers argues. “BDUs require and have historically been accorded the technical and operational flexibility to manage the channel numbers assigned to services within their programming lineups, and there is no compelling public policy rationale to justify imposing new regulatory obligations to BDUs’ channel placements.”
Rogers notes that it is “ironic” that Corus complains about a lack of marketing support for Home and Flavour but at the same time tried to suppress the marketing of HGTV and Food Network when it sent a cease-and-desist letter to Rogers on December 4 to stop it from placing HGTV and Food Network trademarks in on-air advertisements. Rogers said it was forced to take down the ads the next day.
Corus told us that it sent the cease-and-desist letter “because they [ads] infringed on our exclusive rights to the HGTV, Food and Magnolia trademarks and program content, which were still under licence to use at the time.”
As a result, Rogers said it was “forced to employ other, less optimal strategies to communicate the new channel numbers of HGTV and Food Network to our customers” for the launch on January 1, 2025.
Rogers further argues that Corus should not have been allowed to block the channel realignments by simply filing a complaint to the regulator without yet proving it has a case. In the normal course of a Part 1 application, the applicant must demonstrate that it meets the standard three-part legal test for the regulator to accept it, which includes a finding that, without intervention, the company will suffer irreparable harm.
“Once again, the Commission gave Corus automatic and complete regulatory protection based on its entirely unsupported claims and without any consideration regarding Rogers’ needs to serve our customers or adapt our television offerings in response to major changes in the Canadian programming rights market (which implicate Corus’ services),” Rogers adds.
Rogers has said that it wants to bump the three Corus channels off for two related reasons: The first is that the rights to an important chunk of content that makes up those channels are now owned by Rogers after it signed a deal with Warner Bros. Discovery (WBD) and NBCUniversal this past summer. The second is, if Rogers keeps in the same channel slots Corus’s Home and Flavour networks – which were previously called HGTV Canada and Food Network, respectively – it says its customers will get confused and possibly unsubscribe when they can’t find the American programming it just bought and that occupied those slots. Thus, Rogers wants to move its newly branded content in those slots on the dial to avoid that confusion.
In fewer words — this is just a business decision and the CRTC has previously said that it does not want to regulate such decisions, including channel reassignments, Rogers says.
In fact, Corus’s Part 1 application came mere days after an Ontario Superior Court judge ruled that Rogers could repackage channels based on a reading of the companies’ distribution agreements, but did not wade into the standstill matter, which is in the Federal Court’s domain.
“Consistent with the Commission’s past practice, Rogers should be permitted to implement reasonable channel realignments that we deem appropriate to serve our customers in accordance with the terms and conditions of the parties’ affiliation agreement,” it said.
Rogers says this is an unprecedented – and allegedly improper – use of the standstill since it was enacted in 2012. It said it is being used to lock up the rates and terms and conditions of its carriage of 30 discretionary services operated by a single ownership group for a period of more than 16 months.
“For over 16 months now, Corus has been able to weaponize the Commission’s standstill rule in order to gain an unjustified and de facto access right, forcing Rogers and our customers to pay Corus wholesale rates that do not reflect the fair market value of any services within Corus’ portfolio and compensate Corus for a number of serves that Rogers does not want to carry, and our subscribers do not wany to pay for and do not watch,” Rogers said in its reply.
“These conditions are untenable,” it added. “Rogers must be permitted to move forward with our business, manage our costs, and meet our customers’ expectations for choice, value, and compelling content.”
The CRTC earlier this month launched a consultation to examine the market dynamics between broadcasting and programming undertakings in the world of foreign streamers. As part of that, it is reviewing the effectiveness of the standstill rule and whether it should be updated.
Rogers said in its reply submission that it is pleased to see this, but wants the CRTC to address the alleged “regulatory gamesmanship” by programming services like Corus sooner than that.
Rogers deferred to its court filing when asked for comment.
As for Corus: “We strongly dispute many of the points Rogers made and believe the record clearly shows that their actions towards Flavour Network and Home Network are anti-competitive and violate applicable regulations,” a spokesperson told us. “We are very encouraged that audiences have responded so favourably to Flavour Network and Home Network since their rebranding with performance that is consistent with previous levels and greatly exceeding Rogers’ new Food and HGTV channels.”
How we got here
The carriage issue began, according to Corus’s court filing, when the media company filed a notice of dispute with the CRTC on March 9, 2023, which requested CRTC-assisted mediation ahead of the expiry by the end of that year of the companies’ agreements.
The two got to together to negotiate, but that culminated in a CRTC-mandated mediation in April 2024.
The next month, Rogers filed the application looking to terminate the dispute and requested the CRTC lift the standstill on 11 of Corus’s then 33 programming services, including children’s services that it has argued have underperformed.
Corus filed a response in June opposing the removal of the standstill for all but one of the 11 services outlined in Rogers’s application, the filing states. Later that month, Rogers filed the notice to Corus that it intended to terminate the agreements on December 31, 2024, but said it would negotiate on the potential renewal of 22 discretionary services, which included the three channels, but no others.
In August, the CRTC again told the parties that they were engaged in a dispute, which meant they must abide by the standstill rules.
Later that month, Rogers filed its notice to Corus that it intended to notify its subscribers in September that it was going to remove Slice from all pre-assembled channel packages in both eastern and western Canada. Slice included a chunk of Bravo content that Rogers bought the rights to earlier that summer. Rogers then started rebranding its OLN channel to Bravo.
The removal of Slice from the largest broadcaster meant Corus would be losing 60 per cent of that discretionary service’s subscriber base, so it piped up. It rifled off its application to the Ontario Superior Court and then, a day later, filed the urgent application to the CRTC about Slice.
Then it was in late October when Rogers told Corus it intended to change the channel positions of its newly branded Home and Flavour services, which Corus has occupied for years.
During this period, Corus also filed an undue preference complaint against Rogers. Specifically, it alleges that the cable giant is unjustly disadvantaging its Disney-theme content vis-à-vis how it positions foreign streaming service Disney+. Rogers argues, in part, that the services are not comparable and it doesn’t own Disney+, so there can’t be a preference argument there.
Broadly, however, Corus alleges the cable company is abusing its dominant position as the largest broadcaster to push independents like itself out.
Corus points to comments made by Rogers executives, who have explicitly said the strategy is to cut out the “middleman” by directly buying content from the source, instead of wholesaling it from programming undertakings like Corus.
Rogers has called Corus’s complaints “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 said previously. “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.”
