ON THE SURFACE OF IT, allowing customers to pay one subscription fee for Star Choice satellite service at their home and cottage is a very consumer-friendly idea.
Most folks, Star Choice is assuming in offering this deal, generally aren’t in two places at once and are instead watching TV at home during the week and then at Lake Whatsit on Saturday and Sunday. Why not offer to let those consumers pay just one subscription fee? It’ll engender loyalty after all, because who doesn’t like to pay less?
But it’s never that simple, is it?
Videotron named the practice "account stacking", and the term has kinda stuck – in regulatory circles, anyway. In its reply submission to the Commission of April 18th, Star Choice complained that the terminology was pejorative, that it’s a "second address service", and that the Commission should not have made the "account stacking" phrase part of the overall procedure.
Perhaps the Commission has shown what it thinks of the practice already by using the terminology, said Star Choice, which objects to the whole procedure entirely since it’s grown from an undue preference complaint made by Videotron in December to a policy question where the Canadian Association of Broadcasters and others have now weighed in.
Part of the issue, which we’ll get to in more detail below, is that fraud is a problem when it comes to the second address service offering.
For example, a member of my extended family I’ll call Sam, despite my numerous strenuous objections that he’s indirectly helping to put me out of business, is part of a group of six people who now split a Star Choice bill. He pays $16 a month to the so-called "administrator" of this scheme for an all-in Star Choice package (except for pay-per-view). These aren’t hacked systems. They’re all active, but under a single Star Choice account, says this administrator-guy-who’s-really-a-thief-but-doesn’t-think-he-is. (And since he’s a fraudster in the first place, I suppose he could be lying – but it is hard to hack Star Choice gear.)
Not only does this affect Star Choice’s own revenue line, it impacts Cogeco, the cable operator in this area, who has now recently lost five customers (the administrator is a long-time satellite subscriber, and former black market user, for that matter, and not a cable customer). "Sam" was paying Cogeco $120 a month for his all-in TV service. Sixteen bucks was too great a deal to pass up. It’s 87%-off!
(One interesting side note is that all five who switched into this scheme were video-only subscribers to Cogeco, perhaps tangentially speaking to the value of pushing that service bundle.)
The scheme Sam is taking part in is a demonstration of the inherent cracks in the direct-to-home satellite delivery system. Since it’s not hard-wired (the DTH carriers don’t insist people connect their decoder boxes to the phone lines – required for PPV ordering) fraudsters can use the flexibility afforded by satellite technology to take advantage like this.
Extrapolating further, not only is Sam no longer paying Cogeco full-freight, neither are the specialty services he is viewing getting what they deserve in terms of wholesale fees, which is what the CAB is worried about in its account stacking response.
Then again, though, when I was in university, a roommate and I in a basement apartment split the cable bill with the family that owned the home and lived upstairs, since we were all getting our TV from the same spigot. It’s just a splitter creating extra outlets, something cable has historically looked the other way on – and of late, been promoting as a benefit. Is that a form of account stacking? Should every home with a granny flat or a student apartment be made to pay more?
The whole argument, as Star Choice argues, spins out of one word in the Broadcast Distribution Regulations: household. For Videotron (the original complainant) it means house, the bricks and mortar. One dwelling = one subscriber. For Star Choice and the multiple legal texts it quotes in its filing, household has more to do with the people than the roof they live under.
So, if the family is at Lake Thingamajig for the weekend, the household is there, too, and that family shouldn’t have to pay for the same subscription twice, according to Star Choice.
"(I)t is clear that the BDU Regulations permit subscribers to utilize their subscription at two residences owned by the same household," says the company’s submission.
It sounds great. Something I’d like to take part in if I was a Star Choice customer – or had a cottage – but given the scheme I’ve mentioned above, is it a little too friendly and flexible, even with the small number of customers who use the second address service from Star Choice?
The DTH company says that to combat fraud, it regularly audits subscribers who own multiple systems, calling them "on a regular basis to verify the location of Star Choice receivers does not extend beyond the legitimate primary and secondary residences of subscribers," the company’s submission says.
Personally, I hope Sam’s friend gets a call and they’re all shut down, but in the meantime, given the possible implications and the potential impact on the Canadian TV system, this may be one reg that gets re-written so that "household", is simply "house".
But even if that happens, will it matter? I’ve got a Slingbox in my house and it’s the coolest gadget I’ve owned. The box plugs into my PVR and my broadband connection and presto, I have my home’s live TV wherever I can find a broadband connection anywhere in the world, with channel-changing, record, fast-forward and rewind capabilities – just like my TV.
I’ve watched my Cogeco Cable-delivered TV in my back yard, in an airport in Kelowna, a crowded press room in Las Vegas and in an Atlanta hotel room, among other places. The latency is minimal – the lag time between The Masters on live broadcast TV in Atlanta, compared to my Slingbox-delivered TSN broadcast on my laptop was under two seconds – and the picture is more than acceptable – you can easily read the logo on a golf ball when one is pictured.
And I don’t need an additional satellite TV system – or even an additional TV. I could watch at a cottage and no way would I expect to pay another sub fee.
Call us subscribers, homes, households, houses, whatever – there will always be fraudsters – or new technologies – to bypass the system.
And in the end maybe "account stacking", or "second address service" is just plain consumer-friendly and should be available as an option for all BDUs, after all.
