Quite the soap opera between cable & TV

The ongoing feud between the television networks and the cable companies has been raging on for months with some very expensive campaigning while the Canadian public and even their elected representatives have largely been spectators.

CRTC hearings will be continuing into the New Year. But with the two feuding cartels becoming more strident it is unlikely Canadians and their politicians will be able to remain on the sidelines much longer. The social contract, developed over 40 years by several federal governments, between the networks, cable companies and Canadian viewers is coming apart because of changing economic conditions.

The TV-Cable feud may be nominally about whether the broadcasters should be able to charge the cable guys for the right to transmit their signals. But far more will be at stake than fee for carriage as the three-way pact between the two cartels and the Feds comes apart.

The cable guys for example are getting tired of contributing to the Canadian Television Fund. The broadcasters won't commit to contributing more to Canadian television production with fees for carriage.

The CRTC, as the national broadcast regulator, traditionally has sat on top of the three-way pact. But whatever it decides, fee for carriage likely will be reviewed by the federal cabinet.

Now that the Harper government has overruled the CRTC to allow Egyptian-owned Globalive to offer wireless service in Canada, it is difficult to imagine the cabinet staying out of this soap opera. This government likes to make policy decisions by stealth rather than review.

Expect it to gauge which way the public wind is blowing and then choose a winning side at cabinet. Since the broadcasters were able to get their message out first -- cable companies are freeloaders -- they definitely have an edge.

At this point, it is hard to feel much sympathy for either of the feuding cartels.

The television networks are being a little hypocritical about saving local TV after years of cutbacks and consolidation has reduced local stations to turnkey operations. So far there is no guarantee that any of the carriage fees charges to the cable companies would do anything for local television service. More likely the extra money will be used to buy more American programming.

They also get to block out the commercials on American signals and patch in their own -- a pretty sweet indirect subsidy.

As for the cable companies, it must be a nice ride not to have to pay for most of what you are supplying to subscribers on your infrastructure. I say most because they do pay for American signals. However, given what Canadians pay for cable and satellite service, they clearly aren't shy about passing on those costs. They are hardly in a position to be pointing fingers at rapacious broadcasters for being greedy.

The trouble is both sides have legitimate arguments. This is not a simple policy question.

This is why Ottawa should be negotiating a new social contract that is in the interests of Canadians instead of playing Solomon to two feuding cartels.

The CRTC is only the regulator that must interpret and enforce existing policy. The elected government should be throwing open the whole issue to public debate.