1. Security (national and cable/satellite firm) Argument:

(a) National: The Cable TV and Satellite TV Industries have a significant role to play in safeguarding and protecting Canada’s national security. The proliferation of unregulated, unauthorized and illegal TV cable and satellite users throughout Canada creates an enormous headache for our national security, not only from the possibility of terrorists using such signals for clandestine communications, but also for the real threat of disruption of official and public communications, such as police, ambulance and airport systems in times of emergency.

(b) Cable and Satellite Firms: The continued proliferation of TV cable and satellite signal theft and the impunity with which these they have continued and expanded their operations results in a serious breach of confidential operating information on the firms’ operations and capabilities. There is also the continuing threat that, unless these signal thieves are stopped and/or brought to justice, their bad example will be imitated by millions more consumers, in the belief that the cable and satellite TV companies either do not have the technology to identify and catch them, or that their revenues are so large that they do not mind losing a growing fraction of it.

2. Economic Argument:

(a) Estimating Amount of Signal Theft: Taking the Southwestern Ontario and other survey findings of basic and premium or pay cable service theft and generalizing for the US and Canada, the base figure for a loss of revenue is US$5.5 billion per year. Using the average 25% theft rate found in the 2002 Southwestern Ontario Survey, the estimated number of unauthorized signal thieves range from 1,500,000 to 2,000,000. Updating from 2002 and including non-cabled areas and rural areas, the best estimate would be about 2 million.

(b) Revenues Lost to Cable and Satellite Firms: At an average expenditure of $1000 per year per user household for cable or satellite services, the total lost revenue in Canada alone comes to C$1 billion per year. Putting that in perspective, CRTC reported that BDU revenues for 2007 (the latest year available) totalled C$6.3 billion. Hence, 15.87% of current revenues are being lost. This in turn has major implications on the profits of cable and satellite TV firms, as well as on the return to their major infrastructure and equipment investments over the last 20 years.

(c) Implications on GDP Growth and Jobs: In addition, lost revenues of cable & satellite companies translate into lower communications sector incomes and lower GDP for Canada, particularly in this recession year. Obviously, when the revenues of these Canadian cable and satellite TV firms plunge due to signal theft, jobs are lost all the way up the distribution and production chain. These job losses aggravate the already bleak job situation due to the recession.

3. Equity Argument:

(a) Justice: Canada as a country prides itself on being a just society and having respect for the law, with the same law applying to all. Cable and satellite TV signal theft means that while you or I are paying about $75 to $80 per month in cable TV fees (including special or pay features), there are up to 20% of households who are paying absolutely nothing for the same signal and are getting away with it. Simple justice demands that people be treated equally for the same service.

(b) The Law: The law states that individual households are not allowed to own and operate their individual satellite dishes and that the cable TV signals are the property of the broadcaster. Hence, both cable and satellite TV signal thieves are breaking the law every time they receive these unauthorized signals, and the CRTC is supposed to apply implement the law. And yet, one of the reasons they have gotten away from arrest and conviction for so long is that local police authorities are loathe to search for the unauthorized dishes, arrest the offenders and prosecute them for their criminal acts. So thus far, they have remained “above the law”.

 4. Efficiency Argument:

(a) Economic Efficiency: In Economics, efficiency is measured by the ration of output (GDP) to inputs, including resource, labour and capital inputs. When the same inputs are required to produce and distribute the cable and satellite signals but the output is reduced by a percentage attributable to signal theft, the economic efficiency of the communications sector (and specifically the TV industry) is jeopardized.

(b) Rate of Return: Under economic theory, the rate of return to investment tends to be equalized among industries through competitive forces. When the communications sector (TV industry) suffers from a large, long-lasting and illegal drain on its revenues resulting in lower economic efficiency, investment funds will tend to bypass this industry and go to others with a higher rate of return.

5. Cultural Argument:

Cultural Cost to Canada: Charles Dalfen, former CRTC Chairman, made the argument that since Canadian programming is supported by the revenues of the broadcasting system (note that 3 to 5% of cable and satellite broadcasting revenue goes to the Canadian Television Fund, which provides key financing for distinctively Canadian productions, plus the specification that 40% of the specialty service revenue MUST be spent on Canadian programming), TV cable and satellite theft results in the service provider (a Canadian firm) losing subscription fees. Lost revenues by Canadian cable and satellite companies eventually translates into less money going to Canadian cultural programming.

6. Artist’s Intellectual Property Argument:

Returns to Canadian Artists’ Intellectual Property: Signal theft steals the rights of intellectual property holders, particularly our talented and gifted Canadian artists. Their video, cinema, drama, musical, vocal and other performances captured in TV programs cannot receive the rightful economic returns to the value generated by their performances in an environment where cable and satellite TV firms are having their revenues substantially reduced year-after-year by signal theft.