As testimony at the CRTC hearings into broadcast distribution continued this week, the Canadian Association of Broadcasters expressed its fear that American cable biggies might circumvent Canadian ‘genre protection’ rules by leveraging VOD, in effect sneaking their content into the country.

‘We need to ensure the VOD platforms won’t serve as a back-door entry for foreign services that are not already allowed,’ said CAB’s chief regulatory officer, Pierre-Louis Smith, who cited HBO video-on-demand service as a potential interloper. The solution, he argued, is that only programming acquired from Canadian broadcasters should be made available to Canadian VOD subscribers.

CAB’s statement to the CRTC was preceded by HBO’s arrival on Bell Mobility cellphones roughly a week ago – which HBO International SVP Stanley Fertig said was meant to ‘grow our profile in the international marketplace through digital platforms.’ HBO’s exclusive partnership with Bell Mobility includes the delivery of such series as The Sopranos, Sex and the City and Curb Your Enthusiasm.

Calling distributors the ‘top of the food chain,’ producers appearing at the hearings called on the commission to require BDUs to contribute more to Canadian priority programming.

The Canadian Film & Television Producers Association suggested raising distributor contribution levels to 6% of revenues from the current 5%, and refusing to allow cablecos to allocate part of their contributions to their community channels. The community channels are ‘competitive assets that do not merit regulated subsidy,’ argued CFTPA national EVP and counsel John Barrack. The two initiatives would result in the distributors’ funding of Canadian programming doubling to $300 million.

The CFTPA contends that financial data demonstrate that distributors are in the best position to increase their Canadian content support, since revenues from their TV services have increased by 9% to $6.1 billion in 2007 from 2006, and distributor revenues from all their services rose 15% to $8.8 billion.

‘The notion that BDUs face imminent technology, consumer, or economic threats that warrant fundamental regulatory change is false,’ noted CFTPA president/CEO Guy Mayson.

The CFTPA also criticized private over-the-air broadcasters for paying more for US programming while lowering their support for Canadian drama. Regulations supporting Canadian content are needed, stated the CFTPA, or these negative trends will continue. In fact, the association recommended that profitable Category 2 digital channels affiliated with large broadcasting groups or a distributor should have their Canadian content levels raised.

The CFTPA remained neutral on fee for carriage, but in response to questioning by CRTC chair Konrad von Finckenstein, Mayson said that if the arrangement was adopted, additional broadcaster revenues should be linked back to programming.

New pay-TV operator Allarco Entertainment also took a swipe at distributors, complaining that many were refusing to carry its Super Channel despite it being granted mandatory carriage by the CRTC. Six months after launching, Super Channel is still not available on Star Choice, Shaw Cable, Videotron, EastLink, Telus, MTS and a number of Class 1 cablecos who are members of the Canadian Cable Systems Alliance. The delays have cost the pay TV channel over $12 million in the startup year alone, Allarco chair Chuck Allard told the CRTC. Super Channel reached an agreement with Shaw after the pay TV operator turned to the CRTC for dispute resolution.

Meanwhile, Bell Canada presented the CRTC with its ‘Freesat’ proposal to provide a limited package of channels for free to anyone who buys Bell ExpressVu receiver equipment after analog is switched off in 2011. This would mean private broadcasters such as CTV and Global would not have to erect costly digital over-the-air transmission towers across the country. But Bell Video Group president Gary Smith said Freesat would be taken off the table if fee for carriage were granted. In any case, the plan is receiving little support from within the industry.

CTVglobemedia, which is also owned by BCE, is among the large broadcasters pushing for fee for carriage.

A version of this story appeared in Playback Daily.