Canadian Why
By Staff -- Broadcasting & Cable, 7/25/2004 8:00:00 PM
Editor: The July 19 story about Canada's à la carte offerings ("Cheaper by the Dozen," page 22) misrepresented the facts about Canada's limited pay-per-channel system.
While the story relayed the experience of Canadian cable operator Vidéotron, it failed to mention that Vidéotron serves only French-speaking Quebec, about one-fifth of the total Canadian population. And since Vidéotron serves a French-speaking population, its experience with providing American networks à la carte can hardly be applied to the rest of Canada or the U.S.
The evidence from Canada's limited à la carte system shows that Canadians overwhelmingly purchase their cable service in tiers made up of the most popular channels, similar to the packages available in the U.S.
In fact, the limited à la carte services that are available to most Canadians are only niche digital networks and not the popular Canadian and American channels, which remain on tiers. Plus, if the à la carte approach was truly successful, digital-cable penetration would be much higher in Canada than the 22% it currently is. And if Vidéotron's system was so popular, why does Quebec, at 52%, have the lowest cable penetration of any province in Canada?
While in Washington, D.C., recently, Canadian Cable TV Association President Michael Hennessy said that none of the niche digital à la carte channels had yet to make a profit and they essentially repurpose content already available on analog. Hennessy also said he was surprised that some in the U.S. are suggesting that the Canadian model is a good example when Canadians are jealous of the quality and diversity of programming in the U.S. that is not available in Canada.
The facts about Canada's limited à la carte system speak for themselves: that most customers purchase channels packaged in tiers, digital à la carte is a very small percentage of cable sales in Canada, and à la carte is an unproven business model.
Greg Klein, director of economic & policy analysis, NCTA, Washington
(Received via e-mail)
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