The row between CableVision and the Bermuda Broadcasting Company has been rumbling for several years.

James Whittaker explains some of the background and the key issues at stake.

 

How did this debate start?

It dates back to a 2008 amendment to the Telecommunications Act, allowing broadcasters to charge cable providers for content. The Act allowed the BBC to choose between two options: The ‘must carry’ option would have maintained the status quo and compelled CableVision to carry ZBM and ZFB without charge. The second option, the one the BBC elected, was for ‘retransmission consent’ which meant CableVision had to pay them if it wanted to offer its channels. Under this category CableVision was not compelled to run the channels.

So what happened?

After arbitration CableVision and BBC announced an agreement. ZBM and ZFB would be offered at no extra cost to the customer as part of the $30-basic package. But customers would have the chance to opt out and purchase a new $27-package without the two channels — a potentially attractive option given that both were available for free through the TV aerial. CableVison was told it would be allowed to recoup costs by increasing prices on premium packages. Under the deal BBC would only be paid for the customers that explicitly opted to receive its channels through Cable. The deal was described as a ‘win, win’ for the two companies and viewers.

What went wrong?

The Telecommunications Commission blocked the agreement, objecting to the new structure. CableVision appealed and in September last year Justice Kawaley ruled that the commission had abused its power. The judge acknowledged that an agreement existed for the new fee-structure and that the commission had pre-approved this structure.

So why has the new tier not been introduced?

That’s what BBC says should have happened after the judge’s ruling. CableVision declined to comment on this, when questioned.

Does the BBC get any money from CableVision?

BBC says it has ‘not received a dime’ from CableVision. It says the 2008 agreement is proof that their channels are valued at $3-a-month per subscriber. It concludes that CableVision — by continuing to offer ZBM and ZFB as part of its basic package — has been charging customers at this rate without passing on the proceeds to BBC. Mr Richardson said if CableVision was unable to honour the ‘new tier’ deal because of  the Telcommunications Commission ruling then it should have dropped its fee for the basic package to $27-a-month and offered ZBM and ZFB for free until the matter was resolved. CableVision hasn’t commented on this but it is understood that it will claim the agreement and price structure was contingent on the ‘new tier’ system, which Government blocked.

What’s CableVision’s version?

CableVision has said that its customers should not be made to pay for channels they can get for free through their TV aerial. General Manager Terry Roberson said this week: “We have found that the vast majority of our customers are not prepared to pay for a service which has been offered to them for free for so many years, and which would continue to be accessible for free by antenna.

“For this reason, we no longer wish to include local broadcast channels 7 (ZFB) and 9 (ZBM) on our system.”

How does BBC respond?

BBC says it is up to CableVision whether it carries its channels or not, going forward. But it points out that it has been carrying them since the 2008 agreement and needs to pay for that privilege. The two companies are set to go to arbitration to resolve the issue, according to Rick Richardson.

How will this affect me?

CableVision says that in November it will pull ZBM and ZFB from its cable packages. Viewers can’t currently access ZBM without cable or Wow because of damage to a telecommunications tower. So cable customers will miss out on the channel, whose most popular shows include the Let’s Talk chat show and the nightly news with Gary Moreno. Viewers could still get ZFB through the ‘rabbit ears’ antennae but not through cable.

What about international content?

ZBM and ZFB are affiliates of US networks CBS and ABC and as such have exclusive rights for syndicated content in Bermuda. The BBC would seek to protect its agreements and block CableVision from providing content from those networks - which includes various sports packages and popular dramas like CSI — through another channel. CableVision indicated in an ad-campaign earlier this year that it planned to do just that, promising ABC and CBS in high definition. The  campaign prompted CBS to instruct CableVision to protect its copywrighted programming. CBS backed this up with a letter to the Department of Telecommunications in July this year requesting the commission declined any approach by CableVIsion to screen its shows through another channel and warning that any attempt to do so was ‘without authorisation’. CableVIsion has not commented on this but its current position is that it has no details on replacement channels as yet but will keep customers updated.

What does the BBC plan to do?

The BBC says it is planning to switch from analogue to digital before the end of the year anyway. Mr Richardson says the move will make ZBM and ZFB available in digital format for free, without cable. He said it would also mean that whatever shows were broadcasts in HD by the networks, including sports, would be transmitted in HD.