Regulators could step in on Rogers’ NHL deal: report by Chris Powell
Dec 18, 2013
Source: Marketing Magazine
A new report from Moody’s Investors Service says that Rogers Communications’ recent $5.2 billion NHL rights deal is likely to bring a response from federal regulators if it is perceived as negative for consumers.
The report says that the CRTC is likely to weigh in if it deems Rogers’ distribution plans for NHL content as not being in consumers’ best interest through either restricted access or high price.
“Despite the Canadian government’s support of free markets, should Rogers’ plans adversely affect consumers, regulators will respond,” said Moody’s senior vice-president Bill Wolfe in the report: Rogers NHL Deal: Uncharted Territory for Content Distribution and Monetization.
While the full details of Rogers’ distribution plans are unclear, Moody’s said that commercial logic calls for both wide and proprietary distribution. “We believe that Rogers entered into the deal with designs of being more than a mere digital age reincarnation of a traditional television broadcaster,” said Wolfe.
Because it owns both fixed-line and wireless networks, Wolfe said it is likely that Rogers plans to combine “relatively broad distribution” to rival BDUs with tactics that give is network-based operations an advantage in select circumstances.
The report said that if Rogers were either a traditional over-the-air TV broadcaster or approved specialty service, broad distribution and universal access to NHL hockey would be assured. However, because Rogers is neither, it is not obligated to “televise” (emphasis theirs) NHL content. “Existing regulations never anticipated this outcome,” says the report.
It goes on to note that since the Canadian government has adapted to new developments in the digital era with “ad hoc” regulations, it expects any adverse developments for consumers to prompt a targeted response as opposed to a complete overhaul of existing regulations.
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