BERMUDA CABLEVISION EXPRESSES CONCERNS FOR
CONSUMERS OVER “BROADCAST CABLE TAX”

(Hamilton, Bermuda, July 15th, 2008) - In light of recently announced changes to the “must carry” legislation in the Telecommunications Act, Bermuda CableVision is expressing concern for the effects it will have on cable customers.

The Ministry of Energy, Telecommunications and E-Commerce has just introduced changes to the "must carry" rules of the Telecommunications Act to add in a new provision called "Retransmission Consent,” which relates to the carriage of local broadcast television over cable systems. The new provision allows local broadcasters (specifically local broadcast channels 7, 9 and 11) to choose between "must carry" status (meaning their network must be carried over the cable system - as it is today), or "Retransmission Consent" status (meaning the broadcast network will charge the cable companies to carry the programming, a cost which would be passed on to Bermuda CableVision subscribers).

The legislation adding the provision of “retransmission consent” was officially published in the Bermuda Sun on July 11. This has caused concern at Bermuda CableVision, as it will unfairly impact cable customers, ultimately forcing them to pay for a service which is provided free of charge to non-cable customers who use an antenna on their house to receive local broadcast channels.

Terry Roberson, general manager, Bermuda CableVision, explains: "These changes to the 'must carry' provision are unfair to cable customers. They will force CableVision, for the first time, to charge subscribers for local broadcasters' programming. Yet non-cable viewers will be able to continue receiving the local broadcast channels free of charge by using a set-top antenna. In essence, the new legislation will create the equivalent of a 'Cable Broadcast Tax' for cable customers. To date, we have seen little discussion of this matter in the public arena, and we feel it is important that consumers understand the implications of these changes to the legislation. For many years now, CableVision has been providing free coverage of the entire island to the local broadcast channels by carrying their signal over our cable system free of charge, as the 'must carry' regulations required. Moreover, we have never charged our customers for this service, which clearly has benefited the broadcasters, since without CableVision, their signals can not reach all island residents. We saw no reason to change this situation. However, today, under the new law, cable customers will ultimately be forced to pay.”

This is not the first time that changes to the 'must carry' rule have been proposed. Back in December of 2005, similar revisions were discussed. CableVision, understanding customer concerns, conducted a survey to gather their input. Results of the public survey showed that 83 percent of cable customers believed they should not be required to pay for local programming. When asked, "Should cable customers pay for local programming while access is free via antenna," 93 percent of respondents said "no."

A full 70 percent of respondents stated they were very unlikely or somewhat unlikely to install an antenna to receive these channels for free, should they no longer be available via cable. Furthermore, the survey revealed that viewership of local channels is moderate, with most respondents spending less than one hour per day watching local channels.

"We believe these consumer opinions are still valid today," says Terry Roberson. "Our primary concern at this time is to protect the interests of our customers, which is why our position has always been that the 'must carry' rule should remain unchanged. CableVision has already been assisting the local broadcasters for years by carrying their signal free of charge over our system. Without a state-of-the-art cable plant, a broadcast signal could never reach all residents of the island. Moreover, while we have invested more than $19 million in our fibre-based broadband network, the broadcasters have not kept pace with technology in upgrading their systems with digital signals or HD (High-Definition) services. Today, we do not wish to see cable customers unfairly burdened with additional costs that serve ultimately to only subsidise the local broadcasters."

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Media Contacts:

Brandi Travis/Elizabeth Tee
Troncossi Public Relations
Tel: 292-5838
E-mail: brandi@troncossi.bm