The term “value for signals” has been used by the CRTC since their 2010 decision, to stand for a regime where the originating broadcaster of a signal should (possibly) be in the position to recover compensation for the signal that is provided.

In the previous regime, Canadian cable companies simply picked up the free signals from local broadcasters and provided them to other markets. But the 2010 CRTC decision was intended to change this by making it a requirement for cable companies, and other distributors who are not the originators of some of their content, to have the consent of the originating broadcaster. This new regime is a change from the distant signal regime that operated previously, and applied when a signal was to be carried to a non-local market.

The entire situation could be affected by the result of the Supreme Court case (judgement not yet released) looking at whether the CRTC has the authority to give local television stations the ability to negotiate the terms under which cable companies can distribute their signals. The value for signal that was considered by the CRTC has caught the attention of a number of U.S. broadcasters (linked site requires a subscription). Although they are currently able to recover under the distant signal regime, it appears to be their hope that it would increase their income from these signals.

So far, the Federal Court of Appeal has sided with traditional broadcasters, stating that the CRTC, under the Broadcasting Act, is in the position to allow a value for signal regime. If this decision is upheld by the Supreme Court, then U.S. and Canadian broadcasters will be in the position of beginning to negotiate with the cable and satellite broadcasters.

Some of those broadcasters were the same parties who sought leave to appeal the Federal Court of Appeal’s decision. They argued that this impact that value for signal would have on them is in appropriate because of the advantages that local broadcasters already receive. These broadcasters also point to the negative impact for consumers.

Despite protests from the cable and satellite companies that consumers would be unfairly affected, the language of the discussion never seems to go beyond the issue as framed within the traditional broadcasting framework (viewers receiving their “television” through traditional means). Because of this, Michael Geist’s analysis of the two major issues left out of the discussion takes on a particular pertinence. He argued, on his blog, that the Canadian discussion of the “value for signal” regime seems to ignore two of the major issues: the consumers’ perspective, and the internet’s increasingly important role in Canadians’ consumption of content that was originally televised. He says, “the CRTC decision acted as if the Internet scarcely exists.” Geist points out that Canadian viewers are now able to exercise other options in the event that the originating broadcaster fails to make a deal with a given cable or satellite company. He points to the fact that Canadians spend more time online than watching television, and are able, there to find both legal and illegal forms of most televised content.

As a television viewer, I certainly don’t like the idea that my cable costs are likely to increase, but I think such an increase is inevitable where cable companies negotiate fee deals with broadcasters that end up costing more. For viewers who do still consume much of their television through traditional cable or satellite companies, an increase is not going to be a popular move. As Geist pointed out, the likely result will be that even more viewers will turn away from conventional broadcasters and towards the ever-available library of online content.

Hayden McGuire is a JD Candidate at the University of Saskatchewan, Faculty of Law.

Posted in Broadcasting Regulatory Policy, IP, Supreme Court of Canada