Skinny basic TV leaves egg on CRTC’s face

Regulator’s promise to act against providers without hesitation is ringing hollow so far.

blais, crtc, crtc shomi, crtc chair, skinny basic TV

CRTC chairman Jean Pierre Blais.

Skinny Basic TV:

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It’s not too early to call the CRTC’s latest effort to lower consumer bills – skinny basic TV – a fiasco, and that’s certainly what a lot of people are doing.

Taking effect last week, the regulator’s new rules require TV providers to offer a set of basic channels for no more than $25 a month. They also have the option of offering “reasonably” priced channel bundles or individual a-la-carte channels, with both being mandatory come December.

The result is one that everybody but the CRTC saw coming. TV providers put on their best dancing shoes and did a jig around the rules, indeed offering up the required $25 package, but with a host of required additions, surcharges, hardware rental costs and general disincentives, all of which are technically allowed.

In the end, anyone who thought they might actually get basic TV service for just $25 a month is feeling let down. As one anonymous Bell employee told CBC, the intent is clearly to make skinny basic “unbuyable.”

(Bell is being particularly petulant about the whole thing by not including basic U.S. channels such as NBC, ABC and Fox because it doesn’t have to, requiring buyers to subscribe to its internet service as well, and forcing a $199 installation fee on anyone who doesn’t want to sign a two-year contract.)

The resulting condemnation has been broad. A Toronto Star editorial says the “CRTC should speak more loudly,” Globe and Mail columnist Kate Taylor says forcing pick-and-pay was “a bad move” and Buzzfeed, mincing no words, says “everybody hates Canada’s new skinny basic cable packages.”

And yet, CRTC chairman Jean Pierre Blais talked tough shortly before the March 1 implementation, saying the regulator “will not hesitate to act” if TV providers don’t get with the spirit of the whole affair, which is presumably to give Canadians truly affordable TV options.

The words “hesitate” and “act” have different definitions in regulatory land than in the real world, unfortunately. Despite the skinny basic offers being out there for a week, the CRTC is going to “closely monitor the situation” over the next indeterminate while, a spokesperson said on Thursday. That sounds like hesitation.

The CRTC has also said it does not regulate hardware rental fees – a major source of extra surcharges in the fledging skinny basic regime – because it is too difficult to do so. When asked if Bell in particular is allowed to force skinny basic customers to also subscribe to its internet service, the spokesperson said, “I don’t know.”

The CRTC is now in the position of having to add more rules, this time banning surcharges and other abuses, which will perhaps kick off yet another long drawn-out process of hearings and consultations, or at least inevitable appeals and court challenges.

The whole thing will be pointless in the end since the providers, if prevented from nickel-and-diming on TV service, will simply raise internet and wireless fees. Actually, they’re doing that anyway, but anyway…

It’s cute that Blais thought TV providers, who are run by the same executives he recently criticized for owning yachts and helicopters, would respect the “spirit” of the CRTC’s attempt to lower consumers’ bills. It’s even cuter when he says the regulator won’t “hesitate to act.”

This whole skinny basic fiasco is only serving to expose just how ineffectual the regulator can be.

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4 Comments on Skinny basic TV leaves egg on CRTC’s face

  1. The rollout of Skinny Cable isn’t surprising nor should the large gaps the CRTC left. The CRTC has a difficult job of balancing what consumers want and what the providers want. Consumers got a huge win on wireless with the end of three year contracts. With the current broadband review consumers seem posed for another big win on that front. Now if the CRTC circles back to TV and requires BDUs to allow access to the signal with devices from any source Luke the FCC did they could address the surcharge issue on Skinny Cable and give consumers the win we want. Be patient and give it time as it is a balancing act.

  2. Peter Nowak // March 7, 2016 at 11:03 am // Reply

    As someone who watches this stuff and writes about it regularly, I think I have a considerable amount of patience. The average person (i.e. the CRTC’s constituency) unfortunately doesn’t, hence the all-too-common comments from the public about how the CRTC is “useless” or that we should “get rid of it.” Ineffectual efforts like this one don’t help with that.

  3. Sam Davies // March 7, 2016 at 1:25 pm // Reply

    I’d take it a step further Peter. Is it not possible that the CRTC has been stringing us along, offering marginal lipservice gains for the consumer knowing full well that the status quo would remain intact? What is it exactly that disproves that the CRTC is the embodiment of regulatory capture?

    Looking back at the Harper years, how can anyone say that there ever was any form of balance between consumer and provider interests? Has anyone done studies on both the growth and vertical integration of the providers over the last 10 years?

    Myself – I’ll tighten my tin-foil hat and state that the CRTC is all bark with zero bite, and that such is the case by design. I just don’t see them as being in a position of “whoops – how did we not see this coming?” when it is more likely that this is exactly how they saw this playing out.

    Soon enough, they’ll offer some other slower than molasses solution to rectify things 2 years from now, all the while allowing the providers to keep raking it in. Unfortunately, trustworthy and apathetic Canadians will play along. Alas.

    • Cell phone rates have been frozen for almost five years now going back before the Wireless Code of Conduct came in much to the protest of the carriers and ended the hated three year contract.

      Next the CRTC ruled that SimSub in the Super Bowl is now a thing of the past.

      They then passed the Wholesale Code for TV saying essentially that providers cannot withhold streaming services (OTT) from competing BDUs for competitive reasons.

      Then the CRTC dipped into wireless wholesale and said that carriers must treat each other fairly and let people Roam on networks killing a bunch of dead spots.

      They are currently gathering evidence on broadband which will surely result in a broadband code changing how service is provided to customers.

      The industries mistep on Skinny Cable has opened to the door to an FCC style ruling that BDUs must support set top boxes they don’t supply.

      Make not mistake this is the must consumer friendly the CRTC has been for years.

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