OTTAWA – In a submission which generally backs a cable company’s request to use the local avail ad time to market its telephony and high speed Internet products along with programming services, the Canadian Association of Broadcasters has also asked the CRTC for more cost clarity.
An intervention filed with the Commission last week mostly supports an application made by Halifax-based MSO EastLink to expand what the broadcast distribution regulations say can be promoted during the so-called "local availability" time on American cable channels. Those channels (like CNN, A&E and The Golf Channel) make two minutes per hour of ad time available to cable operators around North America. In the States, it’s a billion-dollar business.
In Canada, MSOs are allowed to use 25% of the time to promote its own programming services only while the rest must be given to Canadian broadcasters – at cost – to promote Canadian channels.
Rogers and Shaw have also made the same request and the CAB, while insisting the Commission make it clear that MSOs can only expand the definition to include data and telephony products, supports the change for them as well. However, the association also wants the CRTC to take a look at the fees charged by those MSOs as cost reimbursements to air those Canadian broadcaster ads during the avail time.
The CAB wants the Commission to confirm that:
• charges for the use of local avails should be based only on each user’s share of the direct costs associated with inserting promotional material and should not include any mark-up, overhead or other charge over and above those direct costs
• programming services should have the right to access the local avails with a minimum purchase of no more than six complete broadcast weeks.
The CAB has told the Commission that MSOs are charging higher rates for these avails during prime time as compared to other times of the broadcast day and for channels with better ratings.
"Consistent with the policy permitting a BDU to charge a programming service no more than its share of the direct costs associated with the insertion of promotional material, the CAB requests that the Commission further confirm that a BDU’s rate card for the use of the local avails should be uniform throughout all day parts, with no premium for prime time insertion," says the CAB letter.
"Similarly, the CAB submits that a BDU’s rate card should also be uniform across the local avails of all non-Canadian programming services in which the BDU inserts promotional material, as the cost of doing the insertions should not vary from service to service."
