March 19, 2015 / 8:29 PM / in 3 years

Canadians to be allowed to 'pick and pay' TV channels

GATINEAU, Quebec (Reuters) - Canadian television viewers will no longer be forced to pay for vast numbers of channels they do not watch, the country’s broadcast regulator said in a sweeping ruling on Thursday.

The Canadian Radio-television and Telecommunications Commission (CRTC) said cable and satellite providers had to offer viewers an affordable basic package and allow them to choose additional channels.

Most distributors currently package groups of channels into thematic bundles, which they say means more choice is available at a lower per-channel cost. Consumer advocates complain that viewers are forced to pay for channels they never watch.

The CRTC said cable and satellite companies will have until March 2016 to provide an entry-level television service that includes local channels capped at C$25 ($19.70) a month.

Subscribers will be then be able to add individual channels - known as “pick-and-pay” - or small packages. Companies will have to offer either the pick-and-pay or small bundle option by March 2016, and offer both by December 2016.

CRTC chairman Jean-Pierre Blais said the commission was not making decisions for viewers.

“It is about setting out a roadmap to give all Canadians the freedom to choose the television content that meets their unique needs, budgets and realities,” he told reporters.

The move will be closely watched south of the border, where U.S. media companies have resisted flexible programming, arguing that costs for individual channels will rise sharply.

While the new framework could hurt channels that are left to live or die on their own merits rather than being packaged with popular channels, it could also help cable companies limit viewer defections to cheaper Internet-based offerings from companies such as Netflix Inc (NFLX.O).

“There may indeed be services that will not survive, and there will be job losses,” said Blais, adding he was confident “good companies” would find ways to thrive.

The ruling could fundamentally alter how distribution deals are structured, since it will also allow pay-television services to offer feeds on an individual basis.

For example, viewers currently cannot watch HBO Canada without also subscribing to an associated movie service.

Federal Heritage Minister Shelly Glover - who has overall responsibility for broadcasting - welcomed the ruling.

“Canadian families expect choice and fair treatment when it comes to their spending on everyday items and services,” she said in a statement.

Reporting by Leah Schnurr. Writing by David Ljunggren.; Editing by Diane Craft and Andre Grenon

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