Canadian vendors lay groundwork to dish up satellite radio

Details are still sketchy, but plans for satellite radio service in Canada are slowly moving ahead and one provider hopes to have channels up and running by year-end.

Canadian Satellite Radio is one of two companies licensed

by the Canadian Radio-television and Telecommunications Commission (CRTC) in June to broadcast radio signals from satellites. Last week CSR announced it had signed a contract for preliminary work aimed at building a network of repeaters needed to ensure reliable reception of its signals in major cities.

Stephen Tapp, president and chief operating officer of CSR, said the company hasn’t set a target date to launch its service but expects to do so in the fourth quarter of this year.

Because tall buildings can block access to satellite signals, operators like CSR will need to install repeaters in urban areas. CSR has contracted Yves R. Hamel et Associes Inc. of Montreal to conduct drive testing in major Canadian cities, determining where the repeaters need to go. Tapp said CSR has identified 16 cities will require repeaters.

In smaller centres and rural areas the repeaters are unnecessary.

CSR will use the satellites of, and distribute content from, its American partner XM Satellite Radio Inc. of Washington, D.C. CSR is owned by Canadian businessman John Bitove Jr. Tapp said XM has an option – so far not exercised – to buy 33 per cent of the company, the maximum foreign ownership allowed by law.

In addition to American content from XM, CSR is required by the CRTC’s licensing decision to offer at least eight Canadian channels – two of which must be French and all of which must contain at least 85 per cent Canadian content. CSR is working on setting up facilities to do this, Tapp said.

Tapp said CSR plans to offer a package of channels for $12.99 per month, possibly with premium services available at an extra cost. Sirius Canada Inc., the other company licensed to offer satellite radio here, is expected to offer the same deal.

The other key pieces that must be in place before satellite radio can get off the ground are the receivers. Many of these are expected to be installed in cars, and CSR announced an agreement last October with General Motors of Canada Ltd. under which the automaker will factory-install receivers that work with CSR’s service in more than 50 models beginning in the 2006 model year.

Tapp said XM has arrangements with several other automakers in the U.S. and CSR is working on extending those deals to Canada.

Eamon Hoey, a Toronto telecommunications analyst, said he expects all car manufacturers will offer satellite radio receivers in the 2006 model year. It will take time for the receivers to become widespread, though. “People don’t change their cars every day,” Hoey said, “and they’re not going to change them just to buy a new radio.”

The radios will be available separately for installation in older vehicles, though.

The satellite radio receivers – expected to cost from $100 to $350 depending on features – are specific to content providers. Receivers made to work with the XM and CSR service will not work with that to be offered by Sirius Canada, a partnership in which the Canadian Broadcasting Corp. and Toronto-based Standard Broadcasting Inc. both own 40 per cent and New York-based Sirius Satellite Radio Inc. owns the remaining 20 per cent.

Jim Collins, a spokesman for Sirius in New York, said the company could not comment on its Canadian launch plans. “We are still reviewing the conditions of license from the CRTC and there’s absolutely nothing more that I can tell you other than that,” he said.

The CRTC has also licensed a partnership of Toronto-based CHUM Ltd. and Montreal-based Astral Media Ltd. to provide subscription radio services from terrestrial transmitters rather than satellites.

Hoey said the Canadian government, by failing to reserve satellite capacity for radio, forced Canadian entrepreneurs interested in subscription radio services to form partnerships with U.S. providers or turn to a terrestrial approach as CHUM and Astral did. “Industry Canada screwed up,” he said.

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Grant Buckler
Grant Buckler
Freelance journalist specializing in information technology, telecommunications, energy & clean tech. Theatre-lover & trainee hobby farmer.

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