Two consumer advocacy groups have launched challenges with Canada’s broadcast regulator over CraveTV and Shomi, video streaming services offered by three of the country’s largest media and communications companies.

The Public Interest Advocacy Centre and Consumers’ Association of Canada (PIAC-CAC) filed applications with the Canadian Radio-television and Telecommunications Commission Friday complaining about the “tied selling” used by the two services.

BCE Inc.’s Bell Media launched CraveTV in December, while Rogers Communications Inc. and Shaw Communications Inc. announced their joint venture Shomi in August and made the service available in November.

(BCE owns 15 per cent of The Globe and Mail.)

Unlike Netflix Inc., for example, which offers a standalone video streaming product, both CraveTV and Shomi require subscriptions to other communications services such as television or Internet.

PIAC-CAC argues that tying the streaming services to existing TV or Internet subscriptions runs counter to legislation around broadcasting and telecommunications as well as the CRTC’s rules.

“The tied selling of streaming services, designed to favour legacy business models and to discriminate against customers who wish to only view programming through an Internet service provider of their choice, is something PIAC-CAC believe cannot be supported in the current rules, nor by Canada’s broadcasting policy objectives,” Geoffrey White, counsel to PIAC-CAC, said in a press release Friday.

Shomi launched in what it called a “beta,” or test, phase and is only available to Rogers or Shaw Internet or television customers, while CraveTV is only available to television customers of Bell or distributors it has struck agreements with, such as Eastlink and Telus Corp. Both services charge an additional monthly fee.

“It’s unfortunate that PIAC and CAC are complaining about Canadian creativity and investment with an innovative product that is offered at a very competitive price,” Bell Media spokesman Scott Henderson said Friday. “CraveTV is pro-consumer in that it provides a superior collection of premium TV programming for just $4 a month.”

Mr. Henderson added that CraveTV was meant to “strengthen the Canadian broadcasting system by offering a complementary, value-added service. He said it has been made available to all Canadian distributors and four additional television providers that have signed on to offer CraveTV will launch next week.

“Our objective is to make CraveTV available to as many Canadian TV subscribers as possible.”

Representatives for Rogers and Shaw both sent the following statement Friday: “We are currently in beta for Rogers and Shaw Internet and cable customers and are in discussions with other BDUs [broadcast distribution undertakings or television providers] to carry the service. We are focused on delivering innovative services and world-class content, and as we stated at launch, during the beta phase, we are evaluating various distribution models.”

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