OTTAWA – Existing specialty services which don’t move to high definition "on a timely basis" risk losing their genre protection, the CRTC said last week.
On Thursday, the Commission released its long-awaited framework for the licensing and distribution of HD pay and specialty services, outlining how licenses will be issued, how they will be distributed on cable and how many hours of high definition programming the new HD specialty services will have to air in order to merit carriage.
Also – an additional public notice to come up with a framework to apply to the direct to home satellite companies will be issued soon, said the Commission.
Some of the highlights of the new framework released Thursday:
* At this time, the Commission will not mandate any deadline for the transition from analog to HD.
* The Commission will step away from retaining a role in setting wholesale rates, saying that is best left to commercial negotiations. However, for any HD service mandated for basic carriage (such as APTN or Vision, for example), the current rate will continue to apply.
* It will continue to deal with the HD transition by issuing (as it has already been doing) new transitional licenses, rather that opting for a license amendment.
* During the years it will take to transition from analog to HD, most cable operators (all Class 1s and 2s – and any interconnected Class 3s) will be required to carry both the analog and HD signals of existing specialties, despite objections from the cable industry on the spectrum demands and capabilities of each individual system.
* In order to merit dual carriage and receive an HD transitional license, the programming rules for English language specialties are as follows:
– A minimum of 50% of the evening programming (6 p.m. to midnight) must be HD (21 hours per week);
– Thirty percent of the programming of the broadcast day must be high definition. (37.8 hours a week for a service with an 18-hour broadcast day);
– By the start of year six of the HD license, the specialties have to be up to 50% HD and half of that must be high definition Canadian content.
* French-language and ethnic services face lesser percentage requirements (30% HD during the evening, for example).
* If existing analog specialty services do not apply for, "or otherwise fail to demonstrate that it is prepared to submit an application on a timely basis, the Commission would consider an application from a prospective new entrant to carry on an HD-transitional service in the programming genre of the existing licensee," says the release.
* However, the Commission did not define what "timely" means.
* Because of the bandwidth issues concerning HD, the Commission reduced the number of guaranteed multiplex channels for pay-per-view services from 10 to three.
* Non-Canadian cable channels will not have to re-apply for inclusion on the eligible satellite list when they move to HD.
* The distribution and linkage regime will change in the HD world. Dual and modified dual status designations will disappear, bringing cable’s distribution more in line with DTH. The Canadian Association of Broadcasters had suggested the opposite, where cable’s linkage rules would be applied to satellite distribution.
The Commission, saying they had served their purpose, "determined that the dual status and modified dual status provisions would generally cease to apply to the digital distribution of specialty services on 1 September 2007," reads the framework release.
"(T)he Commission is of the view that the demands and expectations of the marketplace and the consumer should be given more rein. More specifically, the Commission considers that to preserve the distinctions that currently exist between cable and satellite undertakings with regard to the applicability of requirements for the distribution of dual and modified dual status programming services, and to retain the designation of programming services as having such status, would not be appropriate or justified in an HD environment. Accordingly, such designations will not apply with respect to the distribution of HD services, whether authorized by new HD-transitional licences or by amendments to existing licences."
* Finally, the CRTC said it recognizes that the Canadian TV industry’s HD transition has fallen way behind the U.S. but it is hopeful that the Canadian companies will move it, or be marginalized. "(T)he slow pace of the Canadian transition to HD relative to that of the U.S. is a matter of growing comment and concern, both with respect to over-the-air services and pay and specialty services. Further, the gap between Canada and the U.S. is widening as the U.S. digital roll out gains momentum," says the 195th paragraph of the framework.
"The production of HD programming is also much greater in the U.S. than in Canada. In the Commission’s view, if the gap continues to widen, it will take its toll on the Canadian broadcasting system, and audiences for all Canadian services will be affected. Given the consequences for the Canadian broadcasting system, the Commission expects the broadcast industry to pick up the pace of its transition."
– Greg O’Brien
