OTTAWA – Quebec cable company Videotron is claiming Star Choice is selling some systems on a two-for-one basis and that such practices run contra to the Broadcast Distribution Regulations.
In a complaint to the CRTC filed December 2nd, Videotron asked the CRTC to step in and put a stop to the practice, saying the Shaw Communications-owned DTH satellite company was giving itself an undue preference by allowing people to pay one subscription fee on more than one system, which contravenes section 9 of the regs.
Star Choice and Bell ExpressVu have allowed customers to purchase more than one system, ostensibly for a vacation home or homes, and pay one subscription fee, plus an additional system access fee for the second system. Videotron has in the past complained about ExpressVu’s tactics as well and calls the practice "account stacking".
Videotron claims that customers can get such deals and split the monthly fee with a friend or friends, rather than seeing the additional system or systems being used at a cottage or chalet. That, in turn takes two customers away from Videotron for the price of one.
Videotron filed two affidavits in French with its complaint (also in French), where a company employee went to Radio Shack to ask about buying two systems in this manner and also called Star Choice’s toll free number to order to ask the same question. In both instances, the salespeople agreed to do it.
Star Choice, in its reply, doesn’t deny the practice of selling two receivers for one subscriber fee, and says it does not contravene any regulations because, "(i)n authorizing the reception of Star Choice service in this manner, we require such subscribers to demonstrate that they own both residences, as confirmed by the affidavit evidence filed by Videotron.
"The provision of service to two residences owned by one subscriber is premised on the notion that, in general, such subscribers will not be occupying two residences at once," adds the Star Choice letter. "Reception at the secondary residence is simply a substitute for viewing at the primary residence and DTH technology is well-suited to providing the subscriber with such viewing flexibility.
"Although the motivation for the complaint is clear (the desire to recapture subscribers lost to DTH), (Star Choice) respectfully submits that (it) does not confer any undue preference upon itself as a result of permitting subscribers to utilize their subscription at two residences owned by the household," says the letter.
The Canadian Association of Broadcasters, however, has now also weighed in on the issue, telling the Commission that Star Choice’s actions decrease wholesale payments to its specialty and pay members and "such a marketing and billing practice is inappropriate and should not be allowed to continue," said its letter to the CRTC.
Each address must be counted as a separate subscriber, insists the CAB – and programming fees paid accordingly. "The CAB submits that the Commission’s definition of ‘subscriber’ reflects the fundamental criterion that each separate dwelling to which a BDU provides service denotes a unique subscriber, irrespective of the ownership of the dwelling," says the association’s letter.
"To permit Star Choice to treat the provision of service to two or more separate dwellings as a single subscription cannot be reconciled with the definition of ‘subscriber’, which is premised on each individual dwelling to which service is provided by a BDU.
"Where account stacking allows Star Choice to pay a single fee to programming suppliers for what otherwise should be treated as two or more separate and distinct subscriptions, specialty and pay services are deprived of legitimate affiliation payments for those subscribers," says the CAB.
"This practice was not contemplated and is not authorized in affiliation agreements between programmers and Star Choice, or generally in affiliation agreements entered into with other distributors."
More reply comments are due from Star Choice this Friday. Surf back here for more on this story then.
– Greg O’Brien
