CHUM MAY KILL PLAN FOR SUBSCRIPTION RADIO SERVICE Satellite competitors months ahead of ground-based Canadian partnership Simon Tuck – Globe and Mail CHUM Ltd. says it almost certainly won't use the subscription radio licence that the company was granted just three months ago by the federal broadcast regulator, arguing that it would have to compete on a tilted playing field against the two satellite operators that also landed licences.
"It's highly unlikely we'll launch under the original plans," said Peter Miller, CHUM's head of regulatory affairs.
In June, CHUM of Toronto and partner Astral Media Inc. of Montreal were granted a licence to provide subscription radio services using ground-based transmitters. Their proposal was to start with 50 stations that would be heavy on Canadian content and would be available to about 60 per cent of Canadians, almost exclusively in urban areas.
The problem, from CHUM-Astral's perspective, is that the Canadian Radio-television and Telecommunications Commission also granted licences to two U.S.-based satellite operators. Their licences called for the two companies, Sirius Canada Inc. and Canadian Satellite Radio Inc., to offer about 88 channels each, with one-tenth of those stations predominantly Canadian content.
The two satellite companies also plan to launch their services by Christmas, months before the CHUM-Astral project would be off the ground.
The two partners were disappointed again last week when a federal cabinet committee voted to reject an appeal of the CRTC decision.
Iain Grant, managing director of SeaBoard Group, a telecom consulting firm in Montreal, said the market is too busy for CHUM-Astral. "The market is not going to reach that rich or that deep."
CHUM and Astral, Mr. Miller said, are now left exploring the possibility that they could still offer a niche service. The companies will make that decision over the coming weeks, he added.
The timeline is important because the two satellite players are in a race to land the rights to popular programming.
XM Satellite Radio Holdings Inc., the U.S. partner of Canadian Satellite Radio Inc., announced earlier this week that it had reached a 10-year deal with the National Hockey League that will allow the broadcaster to provide its listeners with almost all of the league's games. The deal, which pinches the NHL away from Sirius beginning in two years, is believed to be worth at least $100-million (U.S.).
XM, which says it has 4.4 million subscribers in the United States, also owns exclusive rights to Major League Baseball, NASCAR auto racing and PGA Tour golf, while Sirius has exclusive rights to popular "shock jock" Howard Stern and the National Football League.
Both satellite networks also offer news, comedy and a variety of music. |