At the CCTA conference in Vancouver, Rogers Communications CEO Ted Rogers got it right and Shaw Communications CEO Jim Shaw, surely to the dismay of his shareholders, got it wrong. Rogers urged tough action against illegal grey and black market DTH signal providers. Shaw, as reported in this issue, says let the consumers decide. If the intent was not clear, Shaw later went on TV and said cable’s (already relatively modest) Canadian programming contribution could be in jeopardy if the unregulated market share in this country continues to grow unchecked. And of course, that is exactly what is happening.

American satellite providers do not hold the rights in Canada for much of the programming they deliver and Canadian broadcasters pay top dollar to acquire exclusive use of those same program rights. The black market in Canada constitutes an immediate menace to the regulated and commercial benefits historically accrued to the Canadian broadcasting system. Invoking technology serves to obscure the issue, making Canada look defenseless and leaderless. Canada does not infringe on U.S. copyright beneficiaries. This is simply outright theft.

The Canadian Broadcasting Industry Coalition, representing public and private broadcasters, film and TV producers, the major American studios, Canadian cable and satellite providers and DirecTv, has called on government and law enforcement agencies to implement and enforce laws against signal theft and related commercial practices. The CBIC is seeking prosecution, legal sanctions for contravening the Broadcasting Act enacted by the Government of Canada, and appropriate action on the part of customs and revenues authorities for tax evasion and the violation of import restrictions.

A recent study available on the CCTA website extrapolates that as many as 28% of Canadian households are now wired into grey- and black-market U.S.-originated DTH signals.

A great deal is at stake.

The estimated yearly loss of revenues to our system is in the order of $400 million. The losers in this scam are Canadian program copyright holders, program creators and broadcasters, especially the fledging digital specialty channels which need all the help they can get, and cable and DTH.

At risk is the employment base of the broadcasting and production industries, because the system is being sapped of subscription revenues and the accruing production revenues derived from BDU contributions for agencies like the Canadian Television Fund, not to mention advertising revenues for broadcasters and tax revenues for governments.

In an address to the CCTA conference, CRTC chair Charles Dalfen said, ‘Like you, we believe the black market is hurting all of us and threatens to draw away money from the Canadian broadcasting system as a whole. This is theft, essentially, and it has to be stopped.’

Dalfen says grey-market dishes are less of a threat because Canadians seeking channels not available here must go to the trouble of registering a phony U.S. address.

In any case, Canadian coalition members and government should promptly schedule more meetings with the U.S. satellite companies. Pinpointing the Canadian users of their illegally distributed signals does not constitute sufficient cooperation. They can and must be made to do more.