By Alastair Sharp
TORONTO, Dec 19 (Reuters) - Canada's broadcast regulator took a step toward bringing more flexibility to cable and satellite television packages on Thursday by requiring distributors to offer their customers news channels on a standalone basis.
The move should benefit Quebecor Inc's Sun News Network. The conservative news channel lost a bid in August to require all distributors to offer the channel as part of their basic packages.
At least one distributor, Telus Corp, does not offer the controversial news and opinion channel at all in its main Western Canadian markets.
But on Thursday, the Canadian Radio-television and Telecommunications Commission said TV subscribers should at least have the opportunity to subscribe to all domestic news services, both individually and in packages of similar channels. It set a deadline of May 18 for distributors to comply.
"Canadian news services are an important part of our democracy," CRTC Chairman Jean-Pierre Blais said in a statement.
"With the rules we are announcing today, Canadians, as citizens, will have access to the news services that are of interest to them and will therefore have an opportunity to be exposed to a variety of opinions on matters of public concern."
The loss-making Sun News Network had argued in the mandatory carriage hearing that its target audience was older and poorer, meaning they would not be able to afford to pay for it outside of a basic package.
While the CRTC rejected its bid, it acknowledged the barriers to entry that in turn limited the exchange of ideas.
The mandatory carriage designation is reserved for channels that broaden the range of Canadian content that would otherwise not be able to reach large audiences, including a channel dedicated to political proceedings and another made by and for Aborginal communities.
The regulator is pushing for greater freedom for Canadian television viewers to buy only channels they watch, rather than require them to subscribe to large packages.
Some distributors have moved toward more flexible programming since the CRTC "strongly encouraged" them to do so two years ago, while the commission is collecting views and will hold further public talks on the topic next year.
The moves are being closely watched south of the border, where U.S. media companies ferociously fight flexible programming, arguing that costs for individual channels will rise sharply.
But pick-and-pay programming might help cable companies limit viewer defections to cheaper Internet-based offerings from the likes of Netflix Inc and Amazon.com Inc.