New TV services starting March 1, 2016 fact sheet

Backgrounder

On March 1, 2016, Canada’s licensed TV service providers must begin to offer new services and options for customers. Specifically, the companies must introduce an affordable basic package that costs no more than $25 per month. As well, the companies must introduce either the option to pay for individual channels (“pick and pay”) or small packages of no more than 10 channels.

This fact sheet provides details about these new options.

Affordable basic package

What does the affordable basic package include?
It must include:

• local and regional television stations;
• channels of public interest such as the Cable Public Affairs Channel (CPAC) and Aboriginal Peoples Television Network (APTN);
• educational channels; and
• community channels and services operated by provincial legislatures, where offered.

It may also include at no additional charge:

• local AM and FM radio stations;
• other Canadian over-the-air stations (for a maximum of 10);
• stations affiliated with American commercial networks (ABC, CBS, FOX and NBC) and PBS;
• educational channels of another province or territory in each official language (if no educational channel is offered).

Does the affordable basic package include American networks like ABC, NBC and CBS?
Not necessarily. Service providers do not have to include those channels in their affordable basic package. But some service providers may include them.

We encourage Canadians to shop around and negotiate with service providers to get the services they want at an affordable price. The CRTC has made it easier for Canadians to switch service providers and take advantage of a more competitive marketplace: Canadians no longer have to give 30-days’ notice prior to cancelling these services.

Canadians can search for the service providers in their area using the CRTC’s online tool.

Can service providers charge less than $25 for the affordable basic package?
The price of $25 per month is a maximum. Companies can charge less if they want.

Does the maximum price of $25 a month include a set-top box or other equipment?
The price is only for the channels and access to the service provider’s network.

We encourage Canadians to shop around and negotiate with service providers to get the services they want at an affordable price. The CRTC has made it easier for Canadians to switch service providers and take advantage of a more competitive marketplace: Canadians no longer have to give 30-days’ notice prior to cancelling these services.

Canadians can search for the service providers in their area using the CRTC’s online tool.

Why did the CRTC direct service providers to offer the affordable basic package?
During the CRTC’s Let’s Talk TV conversation, many Canadians said that the price of basic cable, satellite and other TV services was too high. The CRTC took those comments into consideration as it made changes to the way TV channels are delivered. Canadians can now choose the TV services that meet their needs, realities and budgets.

Pick and pay and small packages

What is pick and pay?
Pick and pay is an option that lets people pay for individual TV channels, rather than pay for channels grouped in large bundles.

What are small packages?
Small packages are TV channels that are grouped together in relatively small numbers (five to 10).

Will service providers offer pick and pay on March 1?
Not necessarily. Service providers must offer either pick and pay or small packages starting March 1.

Service providers must offer both pick and pay and small packages by December 1.

Why did the CRTC direct service providers to offer pick and pay and small packages?
During the CRTC’s Let’s Talk TV consultation process, many Canadians said they wanted more control over their choice of channels and programming. The CRTC took those comments into consideration as it made changes to the way TV channels are delivered. Canadians can now choose the TV services that meet their needs, realities and budgets.

How much will individual pick and pay channels cost?
TV service providers set prices for individual channels. The CRTC does not regulate the retail prices they.

Could some channels be more expensive than others on an individual basis?
In a pick-and-pay environment, some channels may be more expensive on an individual basis because they will no longer be cross-subsidized with others in large packages. Cross-subsidization means service providers offset the costs of their more expensive channels with the lower costs of their less-expensive channels. So prices for certain channels may be higher.

Nonetheless, Canadians now have the freedom to decide the right value proposition for them. That value proposition may include individual channels, small packages, free over-the-air television services and online video services.

Does the pick and pay model mean a subscriber can buy something as small as a single-channel service – just Food Network Canada, for instance?
Viewers will need to subscribe to a basic package first (either the new affordable basic package, priced at no more than $25, or a service provider’s first-tier offering).

Why force subscribers to buy a basic or first-tier television service? Why not simply let people pay for individual channels without paying for the basic as well?
During the CRTC’s Let’s Talk TV conversation on the future of the TV system, many Canadians spoke of the importance of local and regional news and information programs. These programs enable Canadian citizens to better participate in Canada’s democratic, economic, cultural and social life. The affordable basic package prioritizes local, regional and international news.

Will all TV service providers have to offer the affordable basic package, pick and pay and small packages?
Almost. All licensed cable and satellite companies will have to offer the affordable basic package, pick and pay and small packages. Companies that have fewer than 20,000 subscribers are exempt from this requirement. Many small service providers use older analog technology instead of newer digital technology, which prevents them from allowing their subscribers to pick channels individually.

This isn’t to say that people who subscribe to a small company’s services have no choice. In fact, most Canadians have alternative options such as access to two satellite television services.

Canadian Radio-television and Telecommunications Commission Economics and Industry