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CRTC favours choice

From Tuesday's Globe and Mail

Cable customers should be able to pick and choose which channels they want, but the old system of buying networks in bundles must also be preserved -- at least for another four years -- to protect some TV stations, Canada's broadcast regulator said yesterday.

In a policy aimed at easing the concerns of the cable networks who fear they will lose subscribers if the bundles are eliminated, the Canadian Radio-television and Telecommunications Commission said it wants cable companies to continue selling their service in so-called tiers on digital.

Those packages would be offered in addition to the pick-and-choose systems that are increasingly available.

The tier system, which was pioneered during the analog cable days and requires that subscribers buy TV channels in set groups or tiers, must be offered on digital cable until at least 2010, the CRTC said.

"Programmers are generally opposed to stand-alone or à la carte program offerings," the CRTC said in a lengthy policy statement.

"Nevertheless . . . consumers should be free to subscribe to them."

As the industry shifts from analog to digital transmission, which provides a high-definition TV signal through a set-top box, cable companies have sought to sell channels individually.

However, in a show of support for analog cable networks concerned that their audiences may plunge, the CRTC said the tiered system must be kept in place on digital cable until 2013. If cable providers have transferred more than 85 per cent of their subscribers to digital after 2010, that system can be dropped.

The tiers have often frustrated consumers who would like certain stations but do not want to be pay for those they don't want.

Allowing that system to remain in place will allow analog cable subscribers to be shifted seamlessly to a digital cable world, while subscribers who want to pick specific channels will also have choice.

The CRTC is also requiring cable operators to offer analog cable networks as part of theme packs, such as sports bundles or movie channels grouped together, which would help market them to customers.

Analog cable channels such as Showcase, TSN, The Score and others draw many of their viewers through the tier system. The industry expects many customers will prefer to move to the same offering on digital cable.

"It makes me feel at ease," said David Errington, vice-president and general manager of The Score, a 24-hour sports highlights channel. He expects cable providers may continue selling channels under the old system after the 2010 deadline passes.

"It provides some certainty because you can prepare for 2010," Mr. Errington said.

Ken Engelhart, vice-president of regulatory affairs at Rogers Communications Inc., said many customers will remain with the fixed packages. However, the CRTC decision will ensure greater choice for consumers.

Cable providers want to offer unfettered choice for their customers as they prepare to go up against telecom companies who are preparing to enter the TV market with promises of letting customers select channels from a menu.

"I think that a lot of our customers like their existing packages because they're familiar with them," Mr. Engelhart said. "But there's a very, very sizable minority that want more choice and flexibility, and so we'll be able to accommodate them."

While Canadian regulators are making the shift from analog to digital cable over a broader period of time, the U.S. government has more aggressive plans, setting a Feb. 17, 2009, deadline to end analog TV broadcasts.

Given that transition, the Canadian Association of Broadcasters said it was pleased the CRTC is allowing the industry to make the shift gradually.

"It's a very positive decision for programmers," said Glenn O'Farrell, president of the Canadian Association of Broadcasters. "It's an approach designed to ensure that individual analog services are not unduly affected during the transition period."

© The Globe and Mail

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