In a development watched closely on both sides of the U.S.-Canadian border, the Canadian Radio-television and Telecommunications Commission (CRTC) voted late last week to require operators of cable, satellite and Internet protocol television networks to offer à la carte program options by the end of next year that will allow customers to select and pay for the channels they want.
As in the United States, multichannel video program distributors (MVPDs) in Canada are facing increasing competitive pressure from Netflix and other web-based streaming services that offer a low cost or no-cost alternative to traditional cable services while providing users with streamlined viewing options. Canada’s top three MVPDs—BCE, Inc., Rogers Communications and Shaw Communications—have all responded in recent months with online streaming services of their own that they have offered exclusively to their cable subscribers. Notwithstanding these moves, CRTC said it felt compelled to “take positive steps to bring about greater choice and flexibility in the Canadian television system” as the nation’s cable operators have shown a lack of willingness to “move to more flexible packaging options on their own.”
Capping 18 months of consultations and hearings, the CRTC decided last Thursday to implement the à la carte regime in two stages. During the first stage, which begins in March 2016, MVPDs will be required to offer a basic cable package to customers which would be capped at maximum monthly rate of C$25 and include local broadcast stations as well as the top U.S. networks. Additional channels may be offered through small, bundled packages or on a pay-as-you-go, à la carte basis. Starting in December 2016, MVPDs will be required to offer subscribers an à la carte option as an alternative to any bundled package offering that is available, and viewers will be able to continue with bundled channel packages if they prefer. MVPDs must also carry independently-owned channels as part of at least one channel package. The CRTC also adopted a code of conduct for retransmission negotiations among MVPDs and broadcasters under which channels “cannot be unduly withdrawn from subscribers as a result of a commercial dispute at the wholesale level.”