CALGARY – If the Shaw-Canwest $200-million tangible benefits package has to be altered or improved – as many, including the CRTC chair on Tuesday morning, have suggested – the Canadian Cable Systems Alliance tabled an idea to take advantage of that potentially rebuilt benefits package it says will help its members survive.
The CCSA represents more than a hundred independent, mostly rural, cable operators across Canada, many of whom must rely on one of the two Canadian satellite relay distribution undertakings (Shaw Direct and Bell TV) for their Canadian specialty channels. They are just too far away to be able to get their TV signals from any nearby fibre link.
The cost of transport has been something the small operators have been begrudgingly paying for years, but the growth of HDTV looks to be a punishing upgrade for the independent BDU sector. So, the CCSA pitched an idea for a new Television Signal Transport Fund, a $40-million subsidy to help pay for the dramatically increased costs of transmitting high definition television signals to faraway cablecos.
According to CCSA president and CEO Alyson Townsend, HDTV transport costs about ten times the cost to transport an SD signal for her members – and these are costs the small BDUs can’t afford to pay as more and more specialty services make the switch to HD. Collectively, the membership pays about a million a year in signal transport fees, and that will only go way up.
“They are an operating cost that no one else in the industry shares,” said Townsend when explaining the need for the fund.
CRTC vice-chair telecom Len Katz took a hard line against the CCSA proposal saying he doesn’t see enough proof, or numbers, of the need “for $40 million to subsidize private businesses. I don’t see support for it (in the evidence),” he said.
“There’s no difference between this and (subsidies) to building broadband out to rural areas,” responded Townsend. “We’re asking you to make it possible for rural Canadians to have access to what urban Canadians do.”
Without help, rural Canadians will have just one choice for a full slate of HD, one of the satellite services, both of which compete against their small cable SRDU customers with their DTH product.
Townsend urged the Commission to look at what the original reason Cancom was founded in the 1980s – to deliver TV signals to small BDUs across the country. Cancom was purchased by Shaw in 2000 and is now called Shaw Broadcast Services and it remains most small BDUs’ primary signal supplier.
Fifteen years ago, Cancom was a separate company and “intended to be a break even business,” said Townsend. Shaw purchased it and since, “the whole idea of being there to support the rural communities has kind of faded into the background.” Plus, the services SBS chooses to offer to BDUs is entirely dependent on what channels the consumer DTH unit Shaw Direct, chooses to carry.
But the real issue is cost and the CCSA hopes there is room for them in a reconstituted tangible benefits package. Added the CCSA’s VP regulatory Chris Edwards: “If there are issues with that package, this could amount to a reasonable concept to the benefit of the broadcasting system and rural Canadian consumers.”
