Federal Court OKs fee for carriage but is it too late?

March 01, 2011  |  Canadian Press with files from Marketing staff  |  Comments

The Federal Court of Appeal has cleared the way for broadcasters to charge cable and satellite providers for carrying their programs but with major changes in the Canadian TV landscape in recent months the implications are unclear.

The CRTC had asked the court to rule on whether it had the right to establish a regime whereby broadcasters could attach a value to their signals–long called fee for carriage but more recently dubbed value for signal by the CRTC.

In a 2-1 ruling released Monday, the court said Yes.

Currently, cable and satellite companies carry network TV programming without paying for it.

Now, private broadcasters such as CTV and Global can begin negotiations with cable and satellite companies to determine rates. The battle between broadcasters and cable companies has gone on for years. At one point Global owners Canwest, and its CEO Leonard Asper, were the most vocal advocates for fee for carriage while cable companies like Shaw said broadcasters had been badly managed and did not deserve the extra money from the distributors. But Shaw now owns Global and CTV (another broadcaster who wanted fee for carriage) will soon be owned by Bell, leaving many to wonder what broadcasters will pursue the new revenue option and from which distributors. Indeed, of the four major network broadcasters in Canada, only the CBC is on its own since Rogers also owns Citytv.

The cable and satellite companies have warned that the extra costs will be passed on to consumers.

The Conservative government had been cool to the idea of value for signal because of that potential added cost for Canadian subscribers.

The private broadcasters had warned repeatedly that without the extra funds, they would have to shut down more local stations and cut back on Canadian productions.

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Craig Rennick

I can’t believe that threats of closing down local stations and cutting back on Canadian programs is really a big deal to most Canadians. Why is the Broadcast Industry so protected? Why do they get away with forced program bundling? Executives in the business make a lot of money but of course they always want more. The same companies who now have the right to negotiate fee for carriage own the specialty networks that have cannibalized their own networks and local stations! I’m all for entrepreneurs making money (like Ted Rogers) but when the trick becomes more about lobbying and politics and artificial rules and regulations that protect the guys that get fat and drive $100,000 cars it pisses me off.

Tuesday, March 01 @ 8:06 pm | Reply

Brad

Great planning. Have they ever heard of the internet. These guys are going to burn down their own businesses because they are greedy as hell. Just the same as cell phones are to land lines, the internet will be to television. If they can’t see that, they are a whole lot more stupid than we thought.

Tuesday, March 01 @ 4:41 pm | Reply

Someone

for hdtv we are asked to pay double what we do for a fast internet connection and for that privilege are forced to watch what the broadcasters tell us to (sure if you spent $500 on a dvr you can watch what you recorded, but it’s all online anyways and accessible with a sub $500 computer anyways). While with a decent computer and an internet connection, we can quite literally watch anything we want at any time of the day without commercials. To suggest that they are going to charge more is just insane.

Tuesday, March 01 @ 4:48 pm

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