1. Cable vs. Satellite The Role of the CRTC

2. Telesat Canada A Canadian public corporation formed in 1969 to deliver satellite services to Canadians ownership: 51% Canadian federal government 49% Canadian telephone monopoly (Bell Canada) No development for a decade Federal government does not challenge interests of telephone companies

3. Cancom CRTC rules (early 80s) that TV signals be made available to remote regions of Canada Cancom: Consortium of four private Canadian broadcasters formed in 1981 Cancom André Bureau becomes president in January 1983 Telesat satellites are used to send TV signals to regions of Canada beyond reach of cable Company loses money immediately Offers only four TV stations (3 English, 1 French) + eight radio stations (in 1983, 3+1 policy) $500,000 monthly revenue & $2 million monthly expenses in 1984

4. CRTC & Cable In 1980s, cable had > 60% penetration of Canadian households CRTC strategy is to deliver universal service via private broadcasters (Cancom) Establishes a pro-cable regulatory paradigm Cancom uses Telesat Canada satellites Sends TV to cable systems (cable companies become Cancoms customers) Direct to home (DTH) signals could be sent only beyond cables reach Cable customers provide revenue flow André Bureau becomes Chair of CRTC in October 1983

5. Death Stars Direct TV: a US satellite TV service In direct competition with cable services Benefits from 1992 FCC ruling preventing cable operators from withholding channels under their control from satellite competitors Canadian cable companies lobby CRTC in response to death star threat Direct broadcast satellite (DBS) service can beam signals all over North America Ted Rogers sings the blues

6. CRTC & Death Stars CRTC regulation of 80% Canadian ownership makes Direct TVs signals illegal Canadian-owned Power Corporation & Direct TV form Power Direct TV 80% owned by Power Corp. 20% by Direct TV

7. CRTC & Death Stars Threat of competition to cable BCE & WIC (Western International Communications) talk to Power Direct CRTC response BCE & WIC licenses will not be renewed if talks continue Direct TV must use Canadian satellites to beam to Canadian homes Threat of more regulatory action

8. Death Stars & Cable Cable Co.s strategy: Develop a wholly cable-owned DTH satellite company DTH Canada created in 1994 Controlled by cable companies (Rogers, Shaw) CRTC forces minority ownership on BCE & WIC CRTC exempts DTH Canada from licensing fees Regulation: no fees for companies using only Canadian satellites DTH uses Telesat satellites

9. The Dust Settles Anti-trust investigation forces Rogers & Shaw out of DTH Canada BCE and WIC gain control of the company DTH morphs into ExpressVu Anti-competitive regulation by CRTC forces Power Direct TV out of Canadian satellite business

10. Canadian Satellite Service ExpressVu Controlled by telephone industry Cancom Controlled by cable industry Star Choice What was the role of the State?