Shaw 2010 Annual Report Download - page 21

Under the Telecommunications Act the CRTC is responsible for ensuring that Canadians in all
regions of Canada have access to reliable and affordable telecommunication services of high-
quality. The CRTC has the authority to forbear from regulating certain services or classes of services
provided by a carrier if the CRTC finds that there is sufficient competition for that service to protect
the interests of users. All of Shaw’s telecommunication retail services have been forborne from
regulation and are not subject to price regulation. However, regulations do impact certain terms and
conditions under which these services are provided.
The technical operating aspects of the Corporation’s businesses are also regulated by technical
requirements and performance standards established by Industry Canada, primarily under the
Telecommunications Act and the Radiocommunication Act.
Pursuant to the Copyright Act the Copyright Board of Canada oversees the collective administration
of copyright royalties in Canada including the review and approval of copyright tariff royalties
payable to copyright collectives by BDUs.
The sections below include a more detailed discussion of various regulatory matters and recent
developments specific to Shaw’s businesses.
Licensing and ownership
For each of its cable, DTH and SRDU undertakings, the Corporation holds a separate broadcasting
license or is exempt from licensing. The broadcasting licenses have generally been issued for terms of
up to seven years. In August 2008, the majority of the Corporation’s licensed cable undertakings were
renewed by the CRTC for a two-year period ending August 31, 2010, which were subsequently
extended to November 30, 2010. Shaw has filed renewal applications for full-term, seven year
license renewals. A license renewal hearing was held in late September 2010 and the decision is
expected in November 2010. The licenses of the Corporation’s DTH and SRDU undertakings are valid
until August 31, 2011. Shaw has never failed to obtain a license renewal for its cable, DTH or SRDU
undertakings. In early September 2009, the Company was granted AWS licenses for ten year terms.
The Company also holds a separate license for each of its conventional OTA television stations and
each specialty service. These CRTC broadcasting licenses must be renewed from time to time and
cannot be transferred without regulatory approval. The majority of the Corporation’s licenses for its
OTA television stations and specialty services expire August 31, 2011. As currently scheduled,
Shaw will file a group renewal application for all of its conventional OTA television stations and
specialty stations in late calendar 2010, with an anticipated CRTC public hearing to follow in early
2011. This public proceeding will determine the various conditions of license, commitments, and
expectations attached to each license over the next license period. More generally, it will determine
the percentage of broadcast group revenue that must be allocated to Canadian programming.
Rate regulation
All of the Corporation’s cable undertakings have been rate deregulated by the CRTC with respect to
the provision of basic cable service. Rates for the provision of basic service by all other types of
licensed and exempt systems, including the DTH undertaking, are not rate regulated.
The potential for new or increased fees through regulation
Effective September 1, 2009, each licensed BDU contributes 1.5% of its gross revenues derived
from Broadcasting to the Local Programming Improvement Fund (“LPIF”) to support local
television stations operating in non-metropolitan markets. The CRTC has indicated that it will
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Shaw Communications Inc.
MANAGEMENT’S DISCUSSION AND ANALYSIS
August 31, 2010