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Canada’s been stealing U.S. signals. Why change now?

It turns out we're a nation of thieves.

No, I'm not talking about all of our fellow Canadians who blithely download music without paying for it. This is something else, going back decades before Napster was even invented. And it's condoned at the highest levels of industry and government.

But if we believe a strong Canadian TV industry is important for our economy and our culture, it probably means we have to keep stealing.

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Here's the story. On Thursday, five local TV stations in the U.S. announced they are asking authorities in Ottawa to correct a longstanding practice that gives cable, satellite, and Internet TV operators in Canada the right to grab their signals with an antenna and then distribute them to viewers without any compensation to the stations. This is actually the business model that built the Canadian cable industry: taking something free out of the air and then sending it into millions of customers' living rooms at a hefty mark-up.

Viewers never seemed to have much of a problem with it – because really, who wants the trouble of dealing with aerials and wires and other nonsense?

Cable companies paid for cable-only channels, but conventional broadcasters never demanded fees because they were already fat enough on advertising.

In the U.S., that changed in 1992, when local stations won the right to charge for their signal. Canadian stations recently followed suit.

Which brings us to today. Calling themselves the U.S. Television Coalition, the group pointed out that changes in Canadian broadcasting policy last year gave our domestic conventional TV stations so-called "consent and remuneration rights," over their own signals. That means a company such as Rogers Cable Inc. now has to get permission if it wants to distribute CTV's signal.

The change came about after local broadcasters in small markets grew concerned about cable and satellite distributors bringing in signals from larger markets (say, the CTV Toronto station CFTO into Moncton, where CKCW is based), diminishing the ability of the local station to attract viewers and advertisers. They took their case to the Canadian Radio-television and Telecommunications Commission, who re-wrote the rules and then stood back to let the broadcasters and distributors sort out how much the signals were worth.

That hasn't actually happened yet, because of a case currently before the Canadian Supreme Court. But broadcasters estimate their signals are worth at least $10-million a year, and perhaps more than twice that amount. And once cable and satellite distributors start paying those fees – and passing them along to viewers – the last thing they're going to want to do is double, triple, or quadruple that payment.

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The U.S. TV Coalition believes its members should be treated the same as the Canadian stations. "Our channels deliver value for Canadians," said Chris Musial, the general manager for Buffalo-based WIVB and WNLO-TV, in a statement. "We expect the right to negotiate appropriate compensation for the full value that our signals and programming deliver to Canadian markets."

The other stations in the coalition are KSTP, a Minneapolis ABC affiliate; the NBC affiliate WDIV in Detroit; and WHEC, the NBC affiliate in Rochester, N.Y.

"I think it's just a matter of fundamental fairness, that if Canada's extended consent rights for the distribution of distant stations, then those consent rights also be extended to American stations when they're being redistributed here in Canada," said Francis Schiller, the organization's Ottawa-based spokesman, in an interview. "Based on the spirit of Canada-U.S. trade, they should be eligible for these consent and remuneration rights, on an equitable and non-discriminatory basis."

Uh oh. He was doing so well, right up until he mentioned free trade. But there are cultural exceptions in that agreeement we struck with the U.S. And if we establish a policy of equity between Canadian and U.S. stations, we might have to allow a tax write-off to Canadian companies who buy ad time on those foreign stations. That could be disastrous for the domestic industry. Just as importantly, the CRTC doesn't regulate foreign-owned channels, so it's hard to see how the coalition's members might get any traction in Ottawa.

Which means we're going to keep on grabbing something for nothing. That's been good for both our broadcasting system and our culture. Why change now?

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About the Author
Senior Media Writer

Simon Houpt is the Globe and Mail's senior media writer, charged with covering the industry's transformation. He began his career with The Globe in 1999 as the paper's New York arts correspondent, covering the cultural life of that city through Canadian eyes. More

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