With access behind them, the crtc is now in the midst of nailing down which services should be exempt from licensing requirements and what criteria should determine them, in public hearings that opened Feb. 19.

Trekking to Hull this week were 19 interveners given standing at the exempt services hearings which, at press time, were still in progress.

On the table are issues ranging from whether new media services qualify as broadcast services and therefore fall under the Broadcasting Act, to whether home shopping, video game, alphanumeric or video-on-demand testing should be subject to licence requirements and making financial contributions to the Canadian broadcasting industry.

Parties including the Canadian Association of Broadcasters, Canadian Cable Television Association, Rogers Communications, cbc, Canwest Global Communications, actra and the Directors Guild are banging heads on a number of issues but there is general agreement on several points:

– Licence-exempt services should make some financial contribution to the Canadian broadcasting system

– There should be public comment prior to the issuing of an exemption order and a time limit on the exemption

– The Stentor-submitted proposal that new media services operating under the terms of an exemption order be part of a central registration list which would allow the crtc and other players to be informed of the players entering the market.

With the exception of the ccta which is arguing there is nothing inherently inflexible or cumbersome about the licensing process to make it less expeditious than an exemption order, the crtc is under widespread pressure to let the new media service providers get on with it and not hold them up with time-consuming regulation requirements.

Speed to market

‘One of the most important keys to success in this new world will be the speed with which new services can be brought to market,’ says Stentor, a sentiment echoed by the cbc.

‘If Canadian services are to compete then they must also be able to respond quickly, to change their program offering, even their technology in days, not weeks or months. It is simply impossible for a licensing process to be sufficiently responsive to allow them the flexibility required by this environment.’

Using limited capital to apply for licence would also limit their ability compete, says the cbc.

In terms of criteria to define exempt services, the cab’s two-fold proposal is receiving support from groups including the dgc. Exempt services which cannot, by their nature, make a material contribution to the Canadian broadcasting system (eg. 900 and 976 services,) or classes of services whose markets are so limited they will not have a significant impact on the licensed services and the system as a whole, should be licence-exempt, says the cab, which offers up more detailed exemption criteria including that the service be temporary, non-profit, of limited availabilty and have limited impact, are relay services, or experimental.

The dgc adds that widely applied exemption criteria may undermine ‘the ability of the Commission to monitor and enforce cultural commitments from those undertakings.’

The exemption hearings are playing off some of the access issues with CanWest pointing out the commission needs to keep limited capacity on the current distribution systems top of mind.

‘Exempt services take up available capacity. Any policy on exemption must be concurrent with the implementation of new access commitments and the general access policy by all distribution systems to prevent preferred capacity for owned exempt services.’

CanWest also recommends that access priorities for exempt services should place them behind licensed services and then given priority position based on their measurable contributions to the Canadian broadcasting system: the higher the contribution, the higher distribution priority.

The dgc and the broadcasters are widely advocating that commercial services such as shopping channels and video game services be subject to license with the dgc stressing that without licence, the result is ‘to lodge control of the these undertakings into the hands of cable licensees, with virtually no policeable requirements to direct some of the profits of these ventures into Canadian production.’

CanWest is going so far as to advocate implementing an ‘immediate freeze’ on cable-owned exempt programming services until an exemption policy is complete.

For its part, Rogers is asking that new access regs not bump tsc off the 234 cable systems currently distributing it. The service currently bringing in 1.9 million viewers per week, employs more than 450 people full-time and provides cable affiliates with 5% of revenues from purchases by subscribers.

‘It provides a unique, high quality and increasingly popular teleshopping service which makes a significant contribution to the Canadian broadcasting system and to the achievement of the social, cultural and economic policy objectives of the Broadcasting Act,’ said Rael Merson, executive v-p of The Shopping Network at the hearing.

Exemption and access policies are expected in April, a necessary precursor to the next round of specialty channel licence hearings which begin May 8.

The access hearings drew to a close Feb. 13 with the Canadian Association of Broadcasters heralding the cable companies’ about-face on the issue of enshrining now-voluntary access rules into regulation, as the most significant outtake of the hearings.

Originally, the ccta took the position that the voluntary Access Commitment already in place should be maintained, but stated at the hearing that they are prepared to accept regulation if the commission sees fit.