The CRTC has denied a request by a number of cable providers seeking to have the basic channel package price increased and a yearly inflation mechanism introduced.
The application, by Bell, Cogeco Communications, Eastlink, and SaskTel, sought to increase the maximum retail price of the basic service from $25 to $28 per month, with further increases tied to the annual rate of inflation. Among the other groups in support of the application were Access Communications Co-operative, Canadian Communication Systems Alliance (CCSA), Pelmorex Weather Networks, Corus Entertainment, and Rogers Communications.
The commission, which mandated licensed broadcasting distribution undertakings (BDUs) to provide customers with an affordable entry-level basic service in 2016, said in Tuesday’s decision that the applicants did not submit any evidence to suggest that the current maximum rate of $25 is no longer economically viable for them as retailers.
“Irrespective of whether or not it is viable, the basic service is an instrument that was designed to benefit the consumer by facilitating choice and economic decisions in a marketplace where broadcasting distribution undertakings (BDUs) have multiple options to recoup their costs,” states the decision. “Moreover, the applicants did not provide any detailed, costed analysis that demonstrates that the cost borne by the BDU for the provision of the basic service has increased as a result of inflation or otherwise, to the extent that a permanent increase of 12% to the maximum allowable retail rate and the implementation of an annual inflationary index are warranted.”
The CRTC said given the high inflation rates currently being experienced, the need to maintain the $25 price cap is greater than ever.
“The Commission is of the view that consumers are more likely to be adversely affected by price increases than BDUs,” said the commission decision. “As cautioned by consumer groups and individual Canadians, those with lower incomes may be forced to cut the cord if an increase to the price cap were implemented. These Canadians would lose access to services that not only reflect Canadian attitudes, opinions, ideas, values and creativity but also, in the case of local stations, provide Canadians with up-to-the-minute news and information on local, regional, national and international matters. Should they wish to retain the basic service, the most vulnerable Canadians may have to compromise on other essential goods and services.”
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