Canada Loosens Restrictions for U.S. Cable Channels

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The end of long-standing genre protection guarantees access for American services that compete with existing Canadian channels.

Canada's TV watchdog on Thursday opened the way for domestic cable giants to launch U.S. channels north of the border without worrying whether they will compete with existing Canadian services.

The CRTC in a landmark decision ordered an end to genre protection, which in the past guaranteed local cable channels carriage and protection from direct competition with U.S. channels. The sea change in the Canadian market will now see open competition among all cable channels in the Canadian market, local or foreign.

"The age of abundance is upon us and we rise to meet its challenges from a position of strength," CRTC chairman Jean-Pierre Blais said in a speech to the Canadian Club in Ottawa. CRTC rules previously denied market access to popular U.S. channels like ESPN and HBO that were judged to compete in part or wholly with existing Canadian TV channels.

That was due to top U.S. TV shows already airing in the country and because their Canadian TV rights have been acquired by domestic broadcasters. No more, the CRTC signaled Thursday, as Netflix Canada and other U.S. digital platforms operating in Canada having removed the need for heavy-handed protections.

The end of genre protection will mean Canadian cable channels can program as required to compete with incoming American services, including rebranding as an incoming U.S. channel. "New specialty services will be able to enter the Canadian marketplace and compete with existing channels. Both existing and new channels will need to be innovative and creative to succeed," the CRTC said in its decision Thursday.

Previously, the regulator played hardball with Canadian cable channels that didn't keep to their genre, as when the Canadian version of OWN: Oprah Winfrey Network strayed from an original educational mandate. U.S. cable channels like CNN and A&E were granted entry into Canada in the early days of cable TV here as they were viewed as strong packaging partners for the new niche Canadian channels.

And the CRTC over the years was choosy in which channels it allowed into Canada, while also denying entry to a host of unsuccessful applicants. But the regulator, in loosening Canadian content rules to meet the digital age, is allowing local channels to in turn better compete with American services now assured of Canadian market entry.

For example, MuchMusic will no longer have to air a certain percentage of music videos as part of its original broadcast license, even though young Canadians go to YouTube and other online video sites to view music videos.

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