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.
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Filed Under: cable, canada, crtc, television

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  1. icon
    morganwick (profile), 6 Apr 2016 @ 6:26pm

    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.

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