Canadian Government Fails To Force Cheaper TV Options, Blames Consumers For Not Trying Harder
from the much-more-of-the-same dept
Last month we noted how Canadian regulator the CRTC tried to do something about the high cost of TV service by forcing Canadian cable operators to provide cheaper, more flexible TV bundles. Under the new CRTC rules, companies had to provide a $25 so-called “skinny bundle” of discounted TV channels starting March 1, and the option to buy channels a la carte starting December 1.
The Canadian TV industry responded, but not in the way government (should have) expected. Some companies responded by pouting and refusing to show regulators faces on TV. Some cable operators tried to hide the options from consumers. Others offered so-called “skinny bundles,” but saddled them with so many below the line fees as to make the product offerings lack any real value. Some cable operators even agreed to adhere to the December 1 a la carte requirement a little early by offering consumers individual channels for sale — but pricing them at $18 each.
In other words the CRTC’s attempt to lower industry prices isn’t really working, in part because the CRTC (much like the FCC in the states) refuses to crack down on misleading, below the line fees and false advertising. In a bit of an odd interview with the Globe and Mail, CRTC boss Jean-Pierre Blais now seems to claim that the CRTC’s efforts can’t be a bust, because the goal was never to lower TV prices:
“People may have thought, mistakenly, that the CRTC was going to reduce everybody?s cable bills ? that?s not what we promised. We said we?re going to give you more choice,? Jean-Pierre Blais, chairman of the Canadian Radio-television and Telecommunications Commission, said in an interview.”
Right, but the reality is that the CRTC’s plan (so far) has fostered neither choice nor lower prices, it has simply fostered the illusion of choice. Users may now be able to get a $25 discounted bundle of TV channels, but once you add on set top rental fees, DVR fees, home gateway rental fees, HD fees, “digital service fees,” fees for additional channel packs you actually want to watch, and the cost of mandatory broadband — you’re not really seeing much if any significant improvement. The CRTC’s effort might work, but it would require cracking down on misleading pricing, which no telecom regulator in North America seems all that keen on.
Oddly, Blais then proceeds to effectively imply consumers (which are calling in at volume to complain about the misleading offers) are to blame for not working hard enough to secure a good deal:
“He said the commission?s aim has been to give consumers ?tools to solve their own problems,? and used a personal anecdote to drive home his point. ?I myself ? looked at my offerings and slimmed it down,? Mr. Blais said, after giving a speech about anti-spam legislation in Toronto on Tuesday. ?Was it easy? No. ? You have to keep going up the chain into [the] loyalty program. It requires effort…This will take time and I?ll repeat it again: Canadians will have to do some work,? Mr. Blais said. ?They will have to be ready to at least threaten to change providers.”
Again though, the end result, even with a lot of consumer work, really is more of the same. Users now get to enjoy the illusion of choice and value, instead of actual choice and value. Which leaves one again wondering if instead of trying to regulate cable prices (and even cable boxes as we’re trying here in the States) it would make more sense to just let the legacy pay TV system collapse under the weight of its own hubris and Internet video competition, then focus the full power of regulatory attention on doing everything possible to promote broadband competition, the real regulatory battlefield of the 21st century.
Filed Under: cable, canada, crtc, television
Comments on “Canadian Government Fails To Force Cheaper TV Options, Blames Consumers For Not Trying Harder”
CRTC
The CRTC created the cable monopoloy that we have in Canada today. They have assured that there is no competition, and they have done nothing for consumers for a generation.
Their original goal was to require Canadian content on all Canadian chanels, but consumers don’t want that. They are supposed to be our representatives, but they haven’t done anything but remove competition, create monopolies, and increased the cost to Canadian consumers.
They are a useless group that has not benefit to Canada, or the people that they (supposedly) represent!
Re: CRTC
“Their original goal was to require Canadian content on all Canadian chanels”
You mean to limit competition?
Oh, Canada!
Two words – “cable cutting.” Google it.
Re: Oh, Canada!
Two words, “Usage caps”. Google it.
So what's different from before?
So….
Mr. Blais said. “They will have to be ready to at least threaten to change providers.”
Sounds like the path to a lower cost is the same now that there is “more choice” than it was before… Threaten to go to a competitor…. as long as you have one.
But that’s what they’re doing… Letting the legacy pay TV system collapse. While pretending to the public that they’re doing something.
The problem with simply letting the legacy pay TV system collapse is that it adversely affects other industries’ ability to adapt to the post-pay TV world. I’m not talking about cable programmers who probably should be left to sink or swim on their own merits. The cable programming business model is such that the broadcast industry in the US feels that it is dependent on retransmission consent fees from the cable companies to compete with cable programmers, which leaves them disdainful of their own nominal medium because they don’t want anyone consuming their wares without paying for them, certainly not if they are paying for cable networks like ESPN. Broadcast SHOULD be more important to an Internet-centric video world than cable because of its theoretical ability to reach mobile devices, but so long as broadcasters are dependent on retransmission consent they’re disinclined to even optimize their coverage areas as they are, let alone to actually reach mobile devices in actuality, and so long as they don’t do that people will continue to think of them as an outdated technology with no role to play going forward, in part by conflating all of linear television with the depredations of the cable bundle, and they’ll be disinclined to forcefully correct them. So now we have the incentive auction that will effectively lock in everything wrong with broadcast television today and potentially cripple it in all new ways as broadcasters abandon the medium for a quick buck when the value of staying in the industry is undervalued, all for the sake of giving wireless companies spectrum they supposedly need in part to deliver video that broadcasting could potentially deliver more efficiently and better. And I don’t know what the solution is other than the FCC imposing their own a la carte system, even if only on the most expensive channels.
Re: Re:
The FCC in the US not Canada.
The FCC has not the best track record since they ditched their original mission statement where a POTUS appointee was steering the fcc engineers to manage power and freq in the public interest.
Now FCC is working in the fascist interests of corporations instead of their original mission statement where they were using engineers to manage power and freq in the public interest.
Don’t listen to ME.
Look at who is USING the SPECTRUM for the truth of the matter. Look to Conflicts, interference, all in the name of profit. Once called the “Public Spectrum”, today it’s like mostly Corporate Owned–if that isn’t an example of FCC failure I don’t know what is.. They had to toss their MISSION STATEMENT!!
Now my opinion, all these people saying FCC needs to regulate internet— boy that was dumb.
I tried to point out the failure with spectrum but, I don’t got billions of ddolalars to squash the msg. So dummies blindly piled on, now the web has a RULER. Kings and Queens appointed them self the rulers. THe freaking FCC needs to be de-activated, and restructured in the public interest– that’s half the battle with the TRUTH and ELECTIONS is this ****ing corporate media.
nothing is ever the government’s fault remember
Where have I heard that argument before...
“Was it easy? No. … You have to keep going up the chain into [the] loyalty program. It requires effort…This will take time and I’ll repeat it again: Canadians will have to do some work,”
Why am I suddenly reminded of Hitchhiker’s Guide to the Galaxy?
“But the plans were on display…”
“On display? I eventually had to go down to the cellar to find them.”
“That’s the display department.”
“With a flashlight.”
“Ah, well, the lights had probably gone.”
“So had the stairs.”
“But look, you found the notice, didn’t you?”
“Yes,” said Arthur, “yes I did. It was on display in the bottom of a locked filing cabinet stuck in a disused lavatory with a sign on the door saying ‘Beware of the Leopard.”
Re: Where have I heard that argument before...
I’d find that funny if it wasn’t so sad!
“We said we’re going to give you more choice”
You can choose to pay more and get less now if you would like to. You’re Welcome.
You are giving the CRTC wayyy too much credit here. With no hidden fees, no nothing, 25$+ the 1 channel you wanted to watch, even at 5$ will put you at more money than your entire base package was before.
There was no way their plan was going to benefit anyone in any way.
Competition
it would make more sense to just let the legacy pay TV system collapse under the weight of its own hubris and Internet video competition, then focus the full power of regulatory attention on doing everything possible to promote broadband competition, the real regulatory battlefield of the 21st century.
If we really had competition, we wouldn’t have to worry about much else. Competition would solve nearly every problem with the broadband and TV markets. The only one that would still be an issue is making sure less profitable markets (poor neighborhoods, rural areas) have good broadband access. But we don’t have that now anyway.
I can understand the flow of this article and I actually agree with it and a lot of the comments too but it seems to me that it overlooks something that at least some of us like about the choice…
I’m not really overjoyed about the skinny bundle I have – I pay $25 for the mandatory channels and and additional $6 for the US networks, I get one DVR that I own connected to the service for free and my second DVR could be connected for an extra $15 (which I’ve chosen to not do). However, I get exactly the channels that I watch programming on – CBC, Global, CTV, Fox, CBS, NBC, ABC for a total of just over $30 per month plus taxes. I used to pay $90 per month to watch those channels and then I had a bunch of sports, news and reality TV channels that I never watched……EVER
For me, this is perfect (and there are a few other Canadians in this same position) – if I need to catch anything else there is the internet as everyone points out and it gives me peace of mind when I’m travelling for business that I won’t get calls at all hours from my non technically inclined family members because as much as cord cutters boost that concept, it isn’t easy for everyone to make this stuff work reliably all the time.
Also, unfortunately we don’t have Google trying to install fibre in Canada so our ISP’s have no incentive to improve connectivity. My connection might give me 60MBPS at 2am on a Tuesday when Jupiter is rising in Cancer or something like that, but trying to put an episode of Bones up on a 50″ TV on a Sunday at 8pm at anything approaching even standard definition through XBMC is enough to try the patience of a buddist monk.
Karl, the article once again points out how you absolutely don’t get the Canadian marketplace at all. You seem to be entirely missing the point of vertical integration and media ownership concentration in Canada.
Why is a single channel $16? Quite simply, because the cable company owns it. They don’t want to compete on price, they have no intention of competing on price, and they just want to maximize revenues.
So looking at the cable providers alone without considering the overall picture is to entirely miss the point. They won’t complain if they have to carry (and operate) less channels but still make the same amount of income!
Re: Re:
The specialist has spoken!
This is precisely what TD has been criticizing all along in the US as well.