Bell TV Won't Pass Retransmission Fees To Subs

Canadian phone giant won't make satellite TV customers pay cost to carry local TV station signals.

TORONTO – Canadian phone giant BCE on Friday continued making concessions to soothe a seething federal government, this time over upcoming retransmission fees.

BCE, which has taken control of CTV after completing a $3.2 billion deal and folded it into a new Bell Media division, said it will not pass on so-called value for signal costs to its Bell TV customers.

Former CTV CEO Ivan Fecan staked his last years atop the national TV network on securing retransmission fees from BCE and other major cable and satellite TV carriers. But now that Fecan has been replaced by former BCE exec Kevin Crull as head of CTV, the phone giant has decided that its satellite TV customers will not subsidize the national TV network.

A federal court recently gave the go-ahead for CTV and other domestic broadcasters to negotiate first-time retransmission fees, or value for signal (VFS) costs, with cable and satellite TV providers. Earlier this week, BCE also backtracked on introducing usage-based billing for Canadian Internet customers by indicating it will not, as earlier planned, charge its wholesale Internet clients via a per-byte model, and will switch instead to a per-Internet service provider (ISP) model.

The phone giant also proposed making its overage fees 30 cents per giga-byte, well down from an earlier $2.50 proposed giga-byte fee. The federal government in Ottawa reacted angrily to BCE proposing that smaller, third party ISPs scrap their unlimited Internet offerings to thwart Netflix Canada and other U.S. over-the-top digital players entering the Canadian market.

To avoid overage fees for its Netflix Canada subscribers, U.S.-based Netflix earlier this week said it will reduce the defaults for picture and sound quality, and so the bandwith, on the Canadian pure video streaming service.