GATINEAU – The CRTC said today the wholesale pricing structure offered by Rogers for NFL Sunday Ticket and NHL Centre Ice pay-per-view packages does not violate the Commission’s TV wholesale code of conduct.
Vidéotron had alleged its affiliation agreements with Rogers for NHL Centre Ice for the 2016-17 and 2017-18 NHL seasons, as well as NFL Sunday Ticket for the 2016 NFL season, included a minimum revenue guarantee, which runs contrary to section 4(g) of the Code Conduct, recounts the decision. (Ed note: Rogers no longer controls the rights to Sunday Ticket, which was purchased by OTT provider DAZN prior to the 2017 NFL season.)
“This section prohibits provisions that set out ‘minimum penetration, revenue or subscription levels, except where negotiated by an independent programming service,’ in any affiliation agreement between a programming undertaking, a BDU or an exempt digital media undertaking,” explains the decision.
Rogers, on the other hand, said its pricing structure, which was dubbed a Fixed Fee Cap in the filing, is a combination of a volume based rate card (VBRC), where per-subscriber rates decrease as penetration increases “and a revenue-sharing arrangement (under which Rogers and Vidéotron will share in revenues from the packages after the fees payable under the VBRC reach a certain value). Rogers stated that while there was no minimum in the VBRC, there was a maximum since the VBRC fees would not exceed the set amounts specified in the agreements,” continues the decision.
“Rogers further argued that Vidéotron was trying to supplement the PPV service that it offers to its subscribers without adding the French-language programming that its Canal Indigo licence would require. Rogers argued that if Vidéotron believes that its current PPV licence is too restrictive, it should apply to the Commission for relief.
“Rogers also noted that other PPV licensees have been able to negotiate access to NHL Centre Ice from Rogers Media Inc. on terms acceptable to them and argued that it is false to suggest that the fee structure for NHL Centre Ice represents an exercise by Rogers of exclusive rights in the NHL Centre Ice package, given that negotiating directly with the rights holder is an option available to Videotron,” adds the decision.
Bell filed an intervention supporting Rogers and Telus filed one in support of Vidéotron.
However, the CRTC noted in its decision that “despite the challenges described by Vidéotron with respect to achieving high subscriber levels for the PPV packages in its linguistic market, the Commission considers that Vidéotron has not demonstrated that the revenue-sharing component of the Fixed Fee Cap constitutes or contains a minimum revenue guarantee.”
Illustration by Paul Lachine, Chatham, Ont.
