This story was updated July 24, 2012
Canadian viewers frustrated with paying for television channels they don’t want can expect more flexible packages in light of a new ruling by broadcast regulators.
The Canadian Radio-television and Telecommunications Commission has ruled in favour of proposals made by Bell Media and Telus Corp. to adopt a more flexible TV package model.
“In this decision, one of our main criteria was flexibility and innovation in the packaging,” said Denis Carmel, a spokesman for the CRTC.
“For those who offered more of this, I would say, this is a win.”
Carmel said that while individual channels may cost more under the new model, consumers’ bills may go down because they will be paying for fewer channels.
The CRTC could not provide details about the terms of the agreement, which is confidential.
The ruling reflects a marketplace that is moving towards more flexible packaging, where consumers only have to pay for what they want, said Carmel.
“In the old days there were huge packages where to get one channel you might have to pay for many more,” said Carmel.
“More and more, the offerings are such that you have more flexibility as a consumer to select what you really want and not have to pay for channels that you may not watch.”
Kevin Crull, president of Bell Media, called the decision a victory for consumers.
“The CRTC has sent a very clear signal that it supports carriage arrangements that will deliver more packaging flexibility to consumers,” said Crull.
“With this decision, Canada will maintain its position as a world leader in providing consumers with both a wide array of programming choices as well as packaging flexibility, all at affordable rates.”
Telus said the decision “recognizes the importance of consumer choice in TV programming.”
“(It) ensures Canadian consumers can not be forced to subscribe to a service from a specific company in order to continue to have access to their favorite content,” the company said in a statement.
“This decision promotes healthy and fair competition between service providers for greater consumer choice.”
But David Purdy, senior vice-president of content for Rogers Communications in Toronto, said that industry-wide adoption of a flexible packaging structure could have significant repercussions for cable companies like Rogers.
While the terms of the CRTC ruling are confidential, Rogers is “somewhat dismayed” by the decision said Purdy. “We thought it to be a victory for those people that own large chunks of the Canadian broadcasting system [ie: Bell Media], and not really a victory for consumers who are looking for more flexible packaging models when they’re buying their cable, satellite or IPTV,” he said.
Purdy predicted that such a model would also have significant impact on channels that have until now enjoyed broad distribution across cable and satellite companies because of the CRTC’s objective to fulfill cultural and/or industrial policy requirements. “There’s no doubt today that a number of channels that enjoy broad distribution and reasonable affiliate payments, in a world where the consumer created their packages from scratch, would have much, much lower penetration,” said Purdy.
Purdy said that 24-hour business news channels are a prime example of programming services that have benefited from broad distribution despite limited audience appeal. “If more than 10-15% of the population actually wanted a 24-hour business news service, it certainly would conflict with all the research we’ve seen,” he said.
UPDATE: This story was updated to include comments from David Purdy on July 24, 2012.
