GATINEAU – We don’t only pay attention to the big companies and their primary talking points. Of course, we do end up telling their stories first, but there are always few other noteworthy hits during hearings such as this week’s CRTC proceeding on Vertical Integration.
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CRTC CHAIRMAN KONRAD von Finckenstein on Monday apologized for overstepping his bounds a little when he put the brakes on a line of questioning from new Commission vice-chair Tom Pentefountas. Rogers Communications EVP regulatory, Phil Lind had mentioned in the company’s opening statement how the CRTC should use this hearing to officially put an end to the value for signal regime.“Mr. Lind, how does vertical integration eliminate the need for value for signal. I know it’s treacherous terrain…” vice-chair Pentefountas began.
However, the von Finckenstein has been quite clear he wants to stick to vertical integration among Canadian companies only and not talk about future potential hearings, ongoing processes (like OTT) or past ones (VFS) and so he immediately put a stop to his vice-chair’s question. “No, I’m sorry. It is not part of this hearing, it is not going to be dealt with, neither by Mr. Lind nor by you, period.”
“Gee, I was hoping I could answer that question,” added Lind.
Later however, after the Quebecor presentation and right before the lunch break, von Finckenstein apologized for dropping the hammer on vice-chair Pentefountas’ query. “I want to apologize to my vice-chairman, Mr. Tom Pentefountas. I cut him off and I think I exceeded my jurisdiction,” said von Finckenstein. “He, obviously, can ask whatever question he wants. It’s a tough subject, which I don’t think is on the agenda, but if he wants to ask the question, that’s fine.”
So, the vice chair re-asked his question and Lind gave his answer, which you can find, basically, here.
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VICE-CHAIR PENTEFOUNTAS also put a pretty fine point on the presentation from Allarco, owners of beleaguered pay service, Super Channel. The company has faced numerous obstacles gaining carriage for is multiplex of channels and asked the CRTC Monday for a number of protections designed to boost its carriage and protect its interests against the large BDUs who Allarco execs say have not been very enthusiastic boosters of the service.
“I listened to your presentation… and I understand your situation. That being said, you come before us — and correct me if I am wrong — you would like us to regulate a number of elements,” said Pentefountas.
"Basically, you want us to regulate the contracts that you sign with BDUs. You come before us and you ask, first and foremost, that you be given bandwidth. You ask that we regulate the marketing strategy of BDUs, pushing them away from marketing internet, wireless and home services, and prioritizing broadcast services. You ask us to control U.S. ad avails, and to regulate what time they should be advertising your services. You want us to exclude the possibility that a liability clause be allowed in the contracts that you sign with BDUs. You want us to regulate MFN clauses out of the potential negotiations that you may undertake with BDUs. You would like to have standalone services imposed on BDUs. You would like us to regulate depth of carriage. You would like us to regulate channel placement. You would like us to regulate the number of HD channels available for your services. You would like us to regulate and prohibit self-dealing. I’m sure I have missed a few of them.
“Given what I have just finished telling you, what is left to negotiate with the BDUs if we are to regulate almost every single aspect of the contract you wish to sign with them?”
Replied Super Channel president and COO Malcolm Knox: “If we don’t have an even playing field, or some assistance with an even playing field, you are going to be regulating four giant companies and that’s it. Everyone else will either be purchased by the vertically integrated companies or they will wither on the vine.”
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INDEPENDENT ISP TEKSAVVY noted to the panel that it plans to launch an IPTV service soon. Not an over-the-top play, but a licensed independent IPTV service in the regulated market. “As a result, we have a keen interest in ensuring that vertical integration in the broadcasting industry does not lead to a reduction in competition in the distribution of programming to Canadians,” the company’s chief business development officer, Patrick Lehoux, told the commissioners.
“Right now we have several other projects in front of that one but it’s definitely on the horizon. But as far as a date, we aren’t quite sure yet,” Lehoux later told Cartt.ca in an interview. As for where it would launch, “we would like to offer it in the biggest footprint possible. It’s just going to be dictated by what we’re allowed to do regulation-wise,” he said.
Teksavvy now provides ISP services across the country and has been busy signing interconnection agreements with cable and telecom companies to lease space on their nets. “We’ve interconnected with most of the cable companies now, except maybe EastLink. We’ve connected with Aliant out east and Telus out west, so we’re pretty much coast to coast. We’re striving to be coast to coast on DSL and cable and are even starting a bit of wireless,” Lehoux explained.
The company also has a VoIP telephony launch planned soon, too.
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On Tuesday, after Bell and Telus appeared, yet-to-launch satellite company FreeHD Canada appeared in front of the Commission. FreeHD joined the many companies calling for ex ante (before the fact) rules governing the actions of vertically integrated companies (and also urged the CRTC to abandon the VFS regime).
But what von Finckenstein also wanted to know was when the satellite TV company was going to launch, as it was licensed over a year ago. Company chairman and CEO David Lewis told the chair he was now hoping for spring 2012.
With satellite capacity now in place, said Lewis, building the required infrastructure around that will likely mean a 2012 launch, but they are hurrying, he added. “We know you’d like to be a subscriber,” Lewis told von Finckenstein.
– Greg O’Brien
