Corus Entertainment has filed a complaint with the CRTC, alleging Rogers’ undue disadvantage in the wake of its merger last year with Shaw Communications, is leading it to engage “in predatory behaviour, enabled by dominant size and scale, to foreclose on potential competition.”
The Part 1 application, published in redacted form on the CRTC website on Monday, focuses specifically on Rogers move to offer the ad-supported version of Disney+ to existing Ignite TV customers, which Corus says is part of an effort to lure subscribers away from its Disney-themed specialty channels. Furthermore, the complaint alleges that Rogers has “actively favoured Disney+ over Corus’ Disney-themed channels when subscribers attempt to search for content; promoted free access to Disney+ on RCCI’s electronic program guide (EPG) directly below the program listings for the Corus Disney channels; and attempted to push traffic to the Disney+ ad-supported tier (and away from Corus Services) for which RMI [Rogers Media Inc.] manages advertising sales in Canada.”
Rogers Sports & Media has also announced its intention to launch competitive discretionary services powered by its new rights deals with NBC Universal (NBCU) in September, and Warner Bros. Discovery in January 2025. Consequently, Warner Bros. Discovery and NBCU are not renewing programming and trademark output agreements with Corus, impacting its Food Network Canada, HGTV Canada, Cooking Channel, Magnolia Network and Slice discretionary services.
Rogers trying to ‘cut out the middle company’: Corus
Corus submits that Rogers’ conduct constitutes a breach of its conditions of service by unduly preferring foreign services such as Disney+, as well as Rogers’ own platforms and channels, while subjecting Corus to an undue disadvantage. It also questions the timing of the move ahead of an upcoming CRTC review of structural relationships in the industry, focused on policies impacting independent programming undertakings.
“RCCI is clearly seeking to bolster its already dominant position with a view to limiting the regulatory measures the Commission might put in place to promote fairness and equity in the industry,” Corus’ application states. “Unless the Commission proactively addresses the issues raised in this complaint, as it pledged to do in the Shaw Decision, Corus fears that ensuring ‘that Canadian independent broadcasting undertakings continue to be able to play a vital role within [the Canadian broadcasting] system’ may not be possible. Indeed, RCCI’s actions toward the Corus Services are clearly part of a larger, predatory strategy to ‘cut out the middle company,’ which affects all Canadian independent programming services.”
“In essence, Rogers is attempting to imperil Corus in every market: content acquisition (as buyer) and advertising and subscriptions (as seller). It is evident that Rogers has no interest in growing its market shares organically within the parameters of a ‘healthy and dynamic wholesale market,'” it continued. “Instead, it is engaging in predatory behaviour, enabled by dominant size and scale, to foreclose on potential competition. As its Chief Financial Officer recently explained, Rogers is ‘looking to source leading programming that customers watch, making that available and making that available at lower margins by cutting out the middle company and going direct.'”
Following Rogers’ acquisition of Shaw Communications last year, Rogers now operates Canada’s largest BDU, with approximately three million subscribers, representing nearly half of the English-language broadcast distribution market. Corus is the country’s largest independently owned broadcast company with 33 discretionary services, 39 radio stations and 15 local television stations, among other assets.
Corus says since the closure of the Rogers-Shaw transaction, the commission hasn’t followed through on a promise to monitor Rogers’ relationships with independent programming services to ensure it’s not abusing its dominant position.
“Unfortunately, since the transaction closed in April 2023, RCCI has largely ignored the Commission’s expectations as outlined in the Shaw Decision,” Corus stated. “Instead of dealing with independent undertakings fairly as the Commission instructed it to do, RCCI has weaponized its more dominant position by aggressively targeting Corus and other independents with unduly disadvantageous treatment.”
Corus needs to ‘earn each customer’: Rogers
Rogers has responded to the Corus complaint, calling it “baseless.”
“Sadly, Corus has not kept up with the demands of Canadians and is now looking for the regulator to protect their broken business model while we’re focused on meeting our customers’ changing viewing habits,” the company said in written statement provided to Broadcast Dialogue. “This baseless complaint is designed to prevent us from providing Canadians with the content they want on their platform of choice. They’re trying to force service providers to carry and our customers to pay for channels they no longer want to watch. They need to compete in a fair system and earn each customer, just like every other company.”
According to Numeris data provided by Rogers, viewership of Corus’ four Disney-themed channels have experienced “a persistent and dramatic decline in Canadian viewers over the past six years,” as much as over 87% between 2018 and 2023 as families move to online options for kids programming.
Rogers points to data from Bell’s response to an application filed by WildBrain last fall, indicating that since 2018-19, children’s program viewing has declined by 68%, while total television viewing has only declined by 18%. That application asserted that the gap between total TV viewing and children’s viewing continues to grow as the genre is disproportionately impacted by families switching to more tailored streaming offerings.
Furthermore, Rogers submits that Corus reduced its spending on Canadian programming on the four Disney-themed channels by an average of 13% every year between 2018 and 2022, according to its 2022 Broadcasting Financial Summary filed with the commission.
The deadline for interventions is Sept. 11.
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