Thank you, Scott.
While the transition represents a milestone for the broadcasting system, the majority of Canadians won't even notice a change on the morning of September 1. That is because 93% of households currently subscribe to cable or satellite television services.
The only viewers who may be affected are those who rely on rabbit ears or an outdoor antenna to receive their television services. How many of these viewers are there? To be on the safe side, we have included every household in our calculations even though some of them may not have a television set.
In markets where the transition is mandatory, approximately 900,000 households may have to buy a converter box. Some models can be purchased for as little as $30. In non-mandatory markets, as many as 31,500 households could potentially lose access to free over-the-air television. Satellite television is often the only alternative to an over-the-air signal in these smaller markets. A receiver and dish would cost each household $300 plus an installation fee.
Now that we have a better understanding of broadcasters' plans, it appears that our initial estimate of the affected households in non-mandatory markets was overstated. The majority of stations on channels 52 to 69 will stay on the air by moving to a lower channel. As a result, fewer households than previously thought will be at risk of losing access to their local television stations. We are reviewing the applications that we have received in order to provide a more accurate estimate.
The Commission has taken additional steps to ensure viewers maintain access to the local and regional television stations that are currently available over the air. Last summer, we changed our regulations to exempt cable and satellite companies from having to distribute the full basic television package. This change was made so that they can offer affected households a package of local and regional stations at no charge. Certain cable and satellite companies have expressed interest in this option.
For example, we permitted Shaw Communications to direct some of the tangible benefits resulting from the Canwest Global transaction to assist with the digital transition. Shaw will spend $15 million to provide and install satellite receivers and dishes to viewers whose local stations decide to drop their over-the-air signals. Shaw will also have to offer these viewers—which include those living in official-language minority communities—a free local package.
For the transition to be successful, affected Canadians must not be caught by surprise on the morning of September 1. We believe they can best be informed through a national education campaign led by the industry.
Broadcasters in particular have a vested interest in ensuring that consumers understand the impending changes to their television services, such as the date and time a station will stop broadcasting in analog. They also need to know where they can obtain converter boxes and satellite dishes, as well as about the existence of free local packages.
Although many broadcasters are currently developing public service announcements, we will soon issue new rules making this a formal requirement. The new rules will also include our final determination on the information broadcasters should make available on their websites.
Public service announcements should start airing as soon as possible, since some stations will be switching to digital before the August 31 deadline.
In closing, I want to underline the fact that the vast majority of Canadians will see no change to their television services as a result of the digital transition. The Commission has therefore been collaborating with broadcasters, distributors and government officials with one objective in mind: to find solutions so that viewers maintain access to the television stations they currently watch over the air.
Everyone has made significant progress toward this goal, especially in the last year. We have every assurance that the industry will be ready on time and over-the-air viewers will be well informed. We would now be happy to answer your questions. Thank you.