Last ditch pitch

Hull, Que.: Armed with days of rehearsals and the wisdom of the 36 services that went before them, the final four specialty channel applicants, including the Labatt and Alliance history pitches, took their kick at the can May 17 and wrapped phase one of the hearings which have been boiling here for a fortnight.

Two weeks into the three-week process, any doubt that last year's negative option debacle left the consumer king has been laid to rest by 10 days of crtc questioning that pressed for proof of subscriber demand.

Impact on existing services, advertising revenue, and programming are taking a back seat this round, with Canadian content and carriage issues stealing the show in the search for services able to entice subscribers inclined to balk at new cable offerings and new package proposals.

"It seems like parts of the Broadcasting Act have moved to the background," muses one applicant. "If you prove demand, don't cost a lot and come in with some kind of commitment to Canadian content, then things look damn good."

A cauldron of issues brew as the applicants prepare for the intervention process beginning May 21 in a hearing which, in part, tests the extent to which the commission will go to stem the invasion of American services into the Canadian market.

Besides the emphasis on marketability, questions over the past two weeks have run the gamut from the anticipated self-dealing and independent production safeguards to the particulars of distribution packages and where Martha Stewart Living would land if Life Network wins the licence for HGTV Canada.

At this point, the 40 applicants, which built business plans with nary a clue of capacity or realistic penetration expectations, are riding high on the cablecos' updated capacity report and the April access decision.

Word now is that 80% of the Canadian cable system has space for somewhere between six to 10 new services, and access guidelines stipulating that Canadian services must be given precedence over foreign services on the distribution system are being heralded by the applicants as a blueprint for guaranteed access.

No longer an issue

"We believe that capacity, although a concern, isn't an issue anymore. The access decision will create and reserve the space. We hope to see a lot of new channels with a licence," says Michael MacMillan, president of Atlantis Communications and a shareholder in the applications for hgtv and sftv, a science-fiction channel.

New-found analog space is leaving applicants originally applying for digital scrambling to justify modified dual or discretionary status. Subscribers, it seems, want and are willing to pay for every one of the 40 propositions, according to the individual nest eggs of research. Every service is a "package driver" guaranteed to boost the penetration of new or existing tiers. As per chairman Fern Belisle: "Everybody's a driver. Nobody is a passenger."

Faced with the inevitability of digital distribution, the traditional means of licensing specialty services is evidently up for grabs with every applicant forced to select from three different "flight plans."