TV

CRTC orders a la carte cable, $25 basic package

The landmark shift to pure pick and pay and build-your-own cable packages comes as the expected regulatory unbundling of Canadian TV gets underway.
March 20, 2015

In its latest Let’s Talk TV ruling, the Canadian Radio-television and Telecommunications Commission (CRTC) has opened the way for the traditional cable package to be broken up into individual TV channels consumers can pick and pay for by December 2016.

Also, as predicted, the regulator will introduce an entry-level cable package of Canadian channels offered to consumers at a discounted CDN$25 monthly price.

The CRTC ruling, announced Thursday afternoon, opens the door to a la carte cable packaging because the regulator insists it’s answering “the desire for more choice and flexibility expressed by many Canadians” during recent Let’s Talk TV hearings.

“Today’s decision gives them (consumers) the ultimate choice,” the regulator said in its decision.

The unraveling of cable bundles – the basis of 40 years of regulatory efforts to protect and promote Canadian TV channels in the face of dominant American competition – is expected to see some local TV channels disappear and the cost of surviving channels rise.

To soften the blow of cable unbundling, the CRTC has ordered carriers to introduce by March 2016 a “skinny” basic cable bundle capped at $25-a -month.

While consumers will still be compelled to buy a basic package as a point of entry, the slimmed-down, price-capped version is meant to address what the CRTC says was consumer concern over price-creep on existing basic packages.

The new skinny package will be comprised of Canadian channels, including local TV stations and educational channels, and may include 4+1, or the major U.S. networks. The entry-level package specifically must include all local and regional TV stations, APTN and CPAC, and applicable community channels.

Distributors can continue to offer a basic cable package that includes popular Canadian and U.S. channels such as CNN and A&E, as long as they make the $25/month skinny basic package available to subscribers.

Either basic package will be the entry point for consumers to then select channels individually or in small bundles.

But more prominently, the CRTC has opened the way for a-la-carte purchase of TV channels by Canadians after March 2016.

By that date, carriers will have to offer TV channels either on a pick-and-pay basis, or in small “reasonably priced” packages.

So if consumers want to purchase one channel, two channels, or a package of four or 15 channels, they will be able to do so.

“They (Canadians) will be able to subscribe to only a few channels, to many channels or keep their current offering,” the CRTC promised in its decision.

Alternatively, carriers can continue to offer pre-assembled packages, “but will not be allowed to require subscribers to buy any services other than those in the entry-level service, offering access to any other service or package.”

That means the end of obligatory theme packs, allowing consumers to purchase TSN without having to buy Sportsnet, or HBO Canada without having to purchase The Movie Network.

Specifically unbundling the multiplex to allow HBO Canada to be sold as a standalone channel, for example, was made possible, the CRTC said, because of its earlier move to scrap genre protection.

The result is HBO Canada or other channels are no longer judged to be competitive to an existing Canadian TV service, and so will be made available for standalone purchase.

At the same time, a carrier can continue to offer HBO Canada and TMN or Movie Central as part of one package.

And with a nod to the bunny-ears and Netflix Canada, the regulator said Canadians can “even watch free, over-the-air television and use online video services to access more content.”

Carriers can offer a la carte purchase of TV services, or pick-5 or pick-10 packages earlier than March 2016, but must do so after that date.

“This will give distributors time to make the changes that are needed to roll out these new options to their subscribers,” the ruling said.

CRTC chairman Jean-Pierre Blais said the cable unbundling was caused in large part by the digital age, which allows Canadians more options beyond traditional TV by which to view video content.

“Thanks in part to the availability of broadband technology, viewers can watch television content at the times, in the places and on the devices they choose,” he said Thursday.

Blais added the latest Let’s Talk TV decision was not about making choices for Canadians, but providing a “roadmap to give all Canadians the freedom to choose the television content that meets their unique needs, budgets and realities.”

This unbundling scenario will mean many existing Canadian specialty channels will no longer be protected and promoted in pricey subscription packages.

Instead, they will need to fight for the favor of cable and satellite TV subscribers who may have bought the services in the past, but never wanted or watched them.

“Some services may not survive in an environment marked by greater subscriber choice, while others will adapt and thrive,” the CRTC noted in its decision.

To ensure a viable market for Canadian TV channels after cable unbundling, the regulator will introduce in September 2015 a code of conduct to “clarify” the wholesale relationship between cable and satellite companies and broadcasters.

(From Playback Daily)

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About The Author
Managing editor with realscreen publication, an international print and online magazine that covers the non-fiction film and television industries. Darah is an award-winning journalist who has spent over two decades covering a wide range of issues from real estate and urban development to immigration, politics and human rights, primarily with The Vancouver Sun. Prior to joining realscreen, she was editor of Stream Daily, realscreen's sister publication covering the dynamic global digital video industry. She also served a stint as a war reporter in Afghanistan for television and print, and was a national business blogger with Yahoo Canada.

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