IF YOU TALK TO ANYONE under 20 they will consider it quaint to hear tales of phones that were connected to walls; notes that were sent with a stamp; and televisions that were housed in large cabinets offering four channels, if you were lucky, accessible with the turn of a dial.
Online and offline; wired and wireless, the world is a dramatically different place than it was 19 years ago. Yet the Canadian media market is still governed by broadcasting legislation from 1991 at a time when urgent action is needed to bring regulation in line with technology to meet consumer demand in today’s competitive marketplace.
On May 18, 2006, Allarco Entertainment was granted the only Canadian national license for a new English-language pay television network in some 20 years. The announcement by the CRTC was cheered by consumers and content providers alike, hungry for a new outlet offering premium broadcasting entertainment. Unfortunately, the launch of Super Channel has not lived up to its potential due to the failure of some cable and satellite providers, including Rogers and Shaw, to comply with their regulatory duties as distributors of Super Channel. Combined, Rogers and Shaw control about half of all access to Canadian subscribers.
Even though the CRTC ruled recently that Super Channel’s launch was significantly impaired because Rogers had subjected Super Channel to an undue disadvantage with respect to its marketing of the service, the CRTC does not have adequate tools at its disposal to enforce its judgment or to ensure regulatory compliance. In Canada the CRTC has no statutory authority to impose monetary fines or compensation for any breaches of its broadcasting decisions.
In the United States and in Great Britain, the FCC and Ofcom, both national broadcast and telecom regulators like the CRTC, have wide powers to impose fines on corporations that do not comply with the letter, intent or expectations of legislation, regulations and/or license conditions.
In a recent letter to the House of Commons Standing Committee on Canadian Heritage, we have urged the Committee to look at ways to enforce meaningful consequences to wrongful behavior by establishing such fines and penalties when CRTC decisions are not upheld.
In order to ensure a fair and open market, to the benefit of Canadian consumers, it is clear the Heritage Committee and the Federal Government needs to upgrade its current legislation:
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Since 1991, not only has technology changed, the marketplace has too. Cable companies, which once just provided clear signals for programming now also offer Internet, local IP telephony and wireless, with broader business interests and more products to promote. While protection of consumer choice has become more challenging, it has never been more important – especially with more and more cable and satellite corporations getting involved in broadcasting ownership.
The financial breakdown of the conventional television broadcasting industry in Canada over the last two years is a dramatic example of how dire the consequences of inadequate regulation and oversight can be.
In recent years the Federal Government bravely opened the doors to competition, which has brought benefits to consumers such as more programming choices. Moving forward, the challenge for the government and the CRTC will be how to ensure competition stays healthy and not controlled by two or three media groups that are intensely concentrated in ownership both vertically and horizontally.
We can not wait any longer, and a first step is getting the Canadian Heritage Committee of the House of Commons working on revising the Broadcasting Act to give ourselves the tools needed to ensure we maintain the leadership we once had in broadcasting and communications well into the next decade: and all the while ensuring choice and access for Canadian consumers.
Charles R. Allard (right) is the Chairman and CEO of Allarco Entertainment and has been involved in the broadcasting and entertainment business for more than 30 years.
