Quotulatiousness

September 10, 2014

Ontario’s bid to impose a Netflix or YouTube tax

Filed under: Cancon, Media — Tags: , , , , , — Nicholas Russon @ 08:28

Michael Geist reports on the Ontario government’s pitch to the CRTC to impose additional tax burdens on foreign online video services:

As CRTC Chair Jean-Pierre Blais anticipated, the Government of Ontario’s call for regulation of online video services attracted considerable attention, including comments from Canadian Heritage Minister Shelly Glover roundly dismissing the possibility. Glover stated:

“We will not allow any moves to impose new regulations and taxes on internet video that would create a Netflix and Youtube Tax.”

Last night, I received an email from a spokesperson for Ontario Minister of Tourism, Culture and Sport Michael Coteau that tried to soften the call for online video regulation. The spokesperson stated:

“The presentation today provided important elements for CRTC consideration as it undertakes its review. The government is not advocating for any CanCon changes, or that any specific regulations be imposed on new media TV, until more evidence is available.”

I asked for clarification on what “more evidence” means. The spokesperson responded that there will be over 100 presentations at the CRTC hearing and that all need to be heard from before moving forward.

Yet a review of the Ontario government submission to the CRTC and its prepared remarks yesterday make it clear that the government strongly supported immediate regulatory reforms and that the need for “evidence” is actually a reference to revenue thresholds that would trigger mandatory payments by foreign online video providers.

May 1, 2014

Rethinking Canadian broadcast regulation

Filed under: Bureaucracy, Business, Cancon, Media — Tags: , , , , , — Nicholas Russon @ 07:27

On Google+, Michael Geist posted a few thoughts on hitting the reset button in Canadian broadcast regulation:

The Broadcasting Act is a complex statute that lists more than twenty broadcasting policy goals. Yet for decades, Canadian policy has largely boiled down to a single objective: Maximizing the benefits from the broadcasting system for creators, broadcasters, and broadcast distributors such as cable and satellite companies.

Consumers were nowhere to be found in that objective and it showed. Creators benefited from Canadian content requirements and financial contributions that guaranteed the creation of Canadian broadcast content. Broadcasters flourished in a market that permitted simultaneous substitution (thereby enabling big profits from licensing U.S. content) and that kept U.S. giants such as HBO, ESPN, and MTV out of the market for years in favour of Canadian alternatives. Cable and satellite companies became dominant media companies by requiring consumers to purchase large packages filled with channels they did not want in order to access the few they did.

As I mentioned in a conversation last night, the Canadian market for broadcast, telecommunications, and internet providers has been carefully managed by the government to minimize the whole messy “competition” thing and ensure quasi-monopoly conditions in various regions across the country. The regulators prefer a small number of players in the market: it makes it easier to do the “regulation” thing when you can fit all the regulated players around a small table, and it also provides post-civil service career opportunities for former regulators. Having a larger number of competing organizations makes the regulation game much more difficult and reduces the revolving door opportunities for former regulators.

July 1, 2013

Positive developments in Canadian government digital policy

Filed under: Cancon, Law, Technology — Tags: , , , , — Nicholas Russon @ 11:59

Micheal Geist rounds up some good news for Canada Day:

As Canadians grapple with news of widespread secret surveillance, trade agreements that could upend intellectual property policy, and the frustrations of a failed wireless policy, there are plenty of digital policy concerns. Yet on Canada Day, my weekly technology law column argues that it is worth celebrating the many positive developments that dot the Canadian digital policy landscape. Eight of the best include:

1. The Supreme Court of Canada’s strong affirmation of user rights and technological neutrality in copyright. [. . .]

2. The Canadian Radio-television and Telecommunications Commission’s policy on network neutrality. [. . .]

3. The defeat of the government’s lawful access legislation. [. . .]

4. Canada’s promotion of user generated content. [. . .]

5. The CRTC’s pro-consumer agenda. [. . .]

6. The Privacy Commissioner of Canada’s aggressive investigations of top Internet companies. [. . .]

7. Canada’s notice-and-notice system for Internet providers. [. . .]

8. Canada’s balanced patent law standards. [. . .]

June 3, 2013

CRTC rule changes may finally signal the end of the three-year phone contract

Filed under: Business, Cancon, Technology — Tags: , , — Nicholas Russon @ 10:54

In Maclean’s, Steve Rennie outlines the new cell phone rules to come into effect later this year:

Wireless customers will be able to cancel their cellphone contracts after two years without any penalties — even if they’ve signed up for longer terms — under a new set of rules unveiled Monday by the federal telecom regulator.

However, the Canadian Radio-television and Telecommunications Commission didn’t go as far as an outright ban on the three-year contracts that Canadians vented so much about earlier this year as the national code for wireless services was being drafted.

“We didn’t focus on the length of the contract, we focused on the economic relation,” CRTC chairman Jean-Pierre Blais said in an interview.

“So, in effect, it’s equivalent to those asking for a ban of three-year contract without us actually banning three-year contracts, because what we’re saying is the contract’s amortization period can only be for a maximum period of 24 months.”

There’s also good news for those who travel with their cell phones (that’d be pretty much every Canadian traveller these days):

The CRTC is also capping extra data charges at $50 per month and international data roaming charges at $100 per month to avoid huge, surprise bills.

The regulator will require providers to allow customers to unlock their devices after 90 days, or immediately if they pay the full amount of the device.

February 23, 2013

QotD: “Cultural Sovereignty” (aka piracy)

Filed under: Cancon, Government, Media, Quotations — Tags: , , , , — Nicholas Russon @ 10:52

Canada originally became one of the most wire-cabled countries in the world because of the insatiable and inviolable addiction of English-speaking Canadians to American programming. To salvage a television industry in Canada, the regulators approved the acquisition of American programming by Canadian channels, which would simulcast them with the networks by or for which they were produced. The Canadian channels were authorized to sell and insert their own advertising on those American programs. This practice, outright piracy in fact, was justified by Canadian media executives as an exercise in “cultural sovereignty” when they appeared before U.S. congressional committees.

Conrad Black, “Opening up the must-carry spectrum”, National Post, 2013-02-23

January 30, 2013

QotD: Confirmation-Bias Theatre Of The Absurd

Filed under: Bureaucracy, Cancon, Media, Quotations — Tags: , — Nicholas Russon @ 00:01

Unlike Andrew Coyne and Pierre Karl Péladeau, I am no expert on CRTC television policy. I couldn’t tell you the difference between a “must-carry” Class A license, a Class B carry-at-will, and a class X concealed-carry. But I do know a little about what makes for good journalism. And on that basis, I’d hate to see Sun News get taken off the air for want of revenue.

Sun’s enemies accuse the network’s hosts of being a bunch of haters. And it’s hard to deny the charge. Among the people they hate: Occupy protesters, fake hunger strikers and sanctimonious left-wing activists.

And Omar Khadr. Wow, do they hate Omar Khadr.

We know this because Sun News TV segments tend to go light on actual news, and heavy on middle-aged white guys shouting about people they don’t like. Sometimes, they sit around their Toronto studio interviewing each other. It’s a sort of performance art that might well be dubbed — by the surprisingly large number of left-wing Toronto hipsters who watch the channel ironically — as Confirmation-Bias Theatre Of The Absurd.

Jonathan Kay, “David Suzuki is poster boy for why Canada needs Sun’s brand of journalism”, National Post, 2013-01-29

January 28, 2013

Let’s get real reform at the CRTC: eliminate “mandatory carriage” altogether

Filed under: Bureaucracy, Business, Cancon, Media — Tags: , , , — Nicholas Russon @ 08:49

In the Toronto Star, Michael Geist calls for the CRTC to stop the “mandatory carriage” provision that forces cable providers to carry certain channels on their “basic” packages:

Canadians frustrated with ever-increasing cable and satellite bills received bad news last week with the announcement that the Canadian Radio-television and Telecommunications Commission will consider whether to require cable and satellite companies to include nearly two-dozen niche channels as part of their basic service packages. If approved, the new broadcast distribution rules would significantly increase monthly cable bills with consumers forced to pay for channels they may not want.

Two issues sit at the heart of the broadcast distribution rules. First, whether the CRTC should grant any broadcaster mandatory distribution across all cable and satellite providers such that all subscribers are required to pay for them as part of their basic packages. Second, in the absence of mandatory distribution, whether broadcast distributors should be required to at least offer the services so that consumers have the option of subscribing.

[. . .]

While the financial benefits for broadcasters are enormous, the policy represents a near-complete elimination of consumer choice for the channels at issue. Rather than convincing millions of Canadian consumers that their services are worth buying, the broadcasters need only convince a handful of CRTC commissioners that their service meets criteria such as making “an exceptional contribution to Canadian expression.” That is supposedly a high bar, yet it is surely far easier than convincing millions of people to pay for your service each month.

Last year, CRTC chair Jean Pierre Blais emphasized that the Commission’s top priority was to “put Canadians at the centre of their communications system.” The mandatory distribution rules do the opposite. Rather than focusing on consumer interests and choice, the rules place broadcasters at the centre of the communications system by offering up the prospect of millions in revenue without regard for what consumers actually want.

There are few, if any, broadcasters that can be considered so essential as to merit mandatory distribution. Niche cultural broadcasters have a myriad of distribution possibilities and should be forced to compete like any other content creator or distributor. In fact, even broadcasters that position themselves as “public services” can often be replicated by Internet-based alternatives.

I always find it interesting how cable providers usually manage to group their offerings so that you can’t get the group of channels you actually want in the same package. I doubt that this would change even if the regulator allowed the change from “must carry” to “must offer”, however: there’s too much potential profit to the cable companies in crafty packaging strategies. You’ll almost certainly not see the opportunity to pay for just the individual channels you want, as that would be too consumer friendly (and, we’re assured by cable company reps, would kill off lots of niche channels because they wouldn’t get enough subscribers).

Of course, if a TV channel can’t attract enough subscribers, that’s usually a pretty strong economic signal that they shouldn’t be broadcasting anyway.

January 24, 2013

Sun TV’s about-face on “making us all pay for it”

Filed under: Business, Cancon, Government, Media — Tags: , , , , , — Nicholas Russon @ 09:12

Andrew Coyne makes some good points about Sun TV’s hypocrisy, he could have made a stronger case for getting the CRTC entirely out of the business of deciding what Canadians can watch on TV:

When the Sun News Network first loomed on the national horizon two years ago, before it had even begun broadcasting, sections of the Canadian left reacted as they do to most things: with hysterics.

A petition was launched — from the United States, as it happens — demanding the CRTC deny Sun the licence it sought, claiming “Prime Minister Harper is trying to push American-style hate media onto our airwaves, and make us all pay for it.”

[. . .]

Well, that was then: much has happened since. Teneycke lost his job, briefly, after questions were raised about how the bogus signatures found their way onto the petition. The network has mostly avoided peddling hate, unless you count that business about the Roma. And, less than two years since its launch, Sun is back before the CRTC, asking to be put on basic cable.

Well, asking is not quite the word. The network, never shy about self-promotion, seems almost an infomercial for itself these days. Network personalities have been drafted to explain the urgent public necessity of making Sun mandatory carriage, that is of taxing everyone with cable or satellite service. Viewers are directed to a website, where they can send an email to the CRTC in support of its application.

[. . .]

But if fairness is what we’re after, there’s another way to go about it. Rather than give every channel an equal chance to stick their hands in the public’s pockets — to force viewers to pay for channels they would not pay for willingly — it is to grant that privilege to no one: to leave viewers free to decide whether or not to subscribe to each channel, on its own merits. And yes, in case anyone’s wondering, that includes the CBC. (Notwithstanding the princely $500 a pop the corporation pays me to bloviate on At Issue, I have been rash enough to argue, publicly and often, for defunding the CBC.)

For goodness sake, it is 2013. The circumstances that might once have justified such regulatory micro-managing, in the days when there were only three channels and barely room for more on the dial, are long gone. Then, a new or special-interest channel might have made the case for market failure: since it was impossible for viewers to pay for channels directly, there was a built-in bias to the biggest audience, and the programming that tailored to it.

February 27, 2012

Goodbye and good riddance to the architect of “Canadian Content” media rules

Filed under: Cancon, Media — Tags: , , , , — Nicholas Russon @ 10:28

Marni Soupcoff on the lasting legacy of former CRTC head Pierre Juneau, the mandatory “CanCon” ratio for TV and radio:

Former CBC and CRTC president Pierre Juneau died last week at the age of 89, and the requisite obituaries followed. Almost all of them congratulated Mr. Juneau on his most well-known achievement: having mandated minimum standards for Canadian content on radio and television. It is an unfortunate legacy.

The troubles with CanCon requirements are both moral and practical: It is not simply wrong to try to forcibly engineer a population’s taste in music in television. It is also impossible. People like what they like, and if what they like is Canadian, they will watch and listen to it even absent rules dictating that they must. If what they like isn’t Canadian, rules saturating the airwaves with all the Loverboy ditties in the world won’t make them tune in.

So even if you aren’t bothered by CanCon rules’ violation of freedom of expression, you should at least ask yourself how effective the regulations can possibly be — especially today. More and more people are selecting their music and television shows on their own, now, picking an episode from iTunes here, a free song download from a band’s webpage there. The idea that the nation’s culture can be shaped by mandating the nationality of prime-time content on TV networks and radio stations is as antiquated as it was flawed to start with. And we’re wasting money and time by continuing to force media outlets to comply.

And yes, my Cancon blog category is a backhand at the longstanding regulation.

November 21, 2011

Michael Geist on the CRTC’s usage-based billing decision

Filed under: Cancon, Economics, Technology — Tags: , , , — Nicholas Russon @ 12:56

It’s not quite what it seems like:

My weekly technology law column [. . .] notes the resulting decision seemed to cause considerable confusion as some headlines trumpeted a “Canadian compromise,” while others insisted that the CRTC had renewed support for UBB. Those headlines were wrong. The decision does not support UBB at the wholesale level (the retail market is another story) and the CRTC did not strike a compromise. Rather, it sided with the independent Internet providers by developing the framework the independents had long claimed was absent — one based on the freedom to compete.

For many years, Canada has maintained policies theoretically designed to foster an independent ISP market. Those policies required the large Internet providers such as Bell and Rogers to make part of their network available to independent competitors. Since the large providers were not supportive of increased competition, the CRTC established mandatory rules on access, pricing, and speed matching.

Yet despite years of tinkering with the rules, the independents only garnered a tiny percentage of the marketplace (approximately six percent). The UBB issue illustrates why the independent providers have struggled since the original proposal would have allowed Bell to charge independent ISPs based on the amount of data used.

While that sounds reasonable, the cost of running a network has little to do with the amount of data consumed. Rather, it is linked to the capacity of the network — the fatter the pipe, the greater the cost, irrespective of how much data is actually consumed.

September 13, 2011

TV ads in Canada required to tone down the volume

Filed under: Cancon, Government, Media — Tags: , , , — Nicholas Russon @ 17:19

I don’t watch a lot of TV (except during football season), but I used to find TV ads in the evening seemed a lot louder than the programs they ran with. This will change:

The number of submissions was unusually numerous for a CRTC notice of comment, and 10 times higher than the complaints it received the previous three years combined.

“Broadcasters have allowed ear-splitting ads to disturb viewers and have left us little choice but to set out clear rules that will put an end to excessively loud ads,” the CRTC chairman, Konrad von Finckenstein, said in a release on Tuesday.

“The technology exists, let’s use it.”

The commission says 2009’s international standard for measuring and controlling television signals will apply to minimize fluctuations in loudness between programming and commercials.

Under the standard, broadcasters will have to ensure that both programs and ads are transmitted at the same volume.

May 6, 2011

CRTC: broadband decision now in government’s hands

Filed under: Cancon, Economics, Government, Technology — Tags: , , — Nicholas Russon @ 13:16

Michael Geist sums up the CRTC’s universal service decision:

The CRTC issued its universal service decision this week, which included analysis of funding mechanisms for broadband access, broadband speed targets, and whether there should be a requirement to provide broadband access as part of any basic service objective. Consumers groups and many observers were left disappointed. The CRTC declined to establish new funding mechanisms (relying on market forces) or changes to basic service and hit on a target of 5 Mbps download speed (actual not advertised) to be universally available by the end of 2015. Critics argued this left consumers on their own and suggested that the targets were underwhelming, particularly when contrasted with other countries.

While I sympathize with the frustration over the CRTC’s decision to essentially make broadband a “watching brief,” I wonder why Canadians should expect the CRTC to lead on broadband targets and funding. Universal access to globally competitive broadband (in terms of speed, pricing, and consumer choice) is a perhaps the most important digital policy issue Canada faces and it should not be viewed through a narrow telecom regulatory lens.

February 9, 2011

Real usage-based billing might work, but not the current form

Filed under: Cancon, Economics, Media, Technology — Tags: , , , , — Nicholas Russon @ 12:25

Tim Wu contrasts the way the UBB issue is being presented and how it might actually be successful:

The issue of usage-based billing is a little tricky because such systems are not inherently evil. When you think about it, we usually pay for things on a usage basis. Gasoline, electricity and even doughnuts are generally billed based on how much you use. And the fact that usage-based billing sounds reasonable in theory is surely why the Canadian Radio-television and Telecommunications Commission approved the new rules.

But take a closer look and something far more insidious is going on. If bandwidth were actually billed like electricity or water, that might be fine. But what the CRTC approved is something different. Claiming that its profit and consumer welfare are exactly the same thing, Bell wants to remake Internet billing. It wants to make use of the most lucrative tricks from the mobile and credit-card industries by preying on consumer error to make money. And this ought not be tolerated.

Any rule that asks the consumer to guess at usage, and punishes you if you’re wrong, is abusive. Imagine being asked to guess how much electric power you need every month, with a penalty for mistakes. Yes, that’s what cellphone companies do — or get away with — but that hardly makes it a model. It’s a system of profit premised on human error, and this begins to explain Bell’s deeper interest in usage-based billing. Bell wants to make the horrors of mobile billing part of the life of Internet users. And that’s a problem.

H/T to Michael O’Connor Clarke for the link.

February 3, 2011

CRTC head called to testify before Commons committee

Filed under: Cancon, Economics, Media, Politics, Technology — Tags: , , , , — Nicholas Russon @ 07:29

In what some are hailing as a victory for Canadian internet users, but might well be just another Conservative sop to public opinion, the head of the CRTC has been called before a Commons committee:

The chairman of the CRTC will appear before the Standing Committee on Industry, Science and Technology on Thursday, as the regulator’s decision on usage-based billing for Internet services continues to generate anger among consumers and businesses.

Konrad von Finckenstein, chairman of the Canadian Radio-television and Telecommunications Commission, will appear before the committee of federal MPs to explain the regulator’s decision, which allows large Internet providers like Bell Canada to charge smaller providers who lease space on their networks on a per-byte, or usage, basis.

On Tuesday, Prime Minister Stephen Harper vowed to review the decision, lending clout to Industry Minister Tony Clement’s announcement to examine the CRTC ruling a day earlier. Mr. Clement and Mr. Harper’s cabinet, of course, have overturned the CRTC before — most notably by striking down the regulator’s ruling that Globalive, which now operates Wind Mobile, couldn’t launch service in the regulated sector because of foreign financial backing.

The problem for the government is that they need to be seen to do something, but the best “something” would be to open up the Canadian market to foreign competition in order to drive prices down toward world levels. That would upset too many cosy arrangements for the current beneficiaries of licenses to print money government approval to operate.

February 1, 2011

Now roiling the hoi-polloi: bit-by-bit billing

Filed under: Bureaucracy, Cancon, Economics, Media — Tags: , , , — Nicholas Russon @ 07:18

The internet is about to become a political topic . . . not the internet itself, but the prices Canadians will have to pay to get online:

Industry Minister Tony Clement says he is looking closely at the “usage-based billing” decision issued last week by the CRTC that has consumers, businesses and citizen groups’ decrying what they see as a price hike for Canadian Internet services that could clamp down on innovative technologies.

“I can assure that, as with any ruling, this decision will be studied carefully to ensure that competition, innovation and consumers were all fairly considered,” Mr. Clement said in a statement obtained by The Globe and Mail.

The decision will allow large Internet service providers (ISPs), such as Bell Canada and Rogers Communications, to charge smaller ISPs that lease space on their networks on a volume basis. Executives at smaller providers have already begun phasing out popular “unlimited” Internet packages because it has become economically unfeasible to continue offering them.

I wondered how long the current situation would last: Bell and Rogers used to tout their “unlimited” internet access, but if you read the fine print, it wasn’t really “unlimited”. Like any resource that is “free”, some will use far more of it. In the early days of broadband, that didn’t matter, as there were not enough users to consume all the bandwidth anyway. Now that there are many more subscribers, the heavier bandwidth users are causing problems.

In addition to the sheer number of broadband customers, another change that was not fully foreseen was the way those customers use their internet connections has changed. When Bell and Rogers got into this market, there were far fewer options for using the internet. You could visit websites all day long, read email, listen to cheesy renditions of popular music, and (for some) download pirated movies for hours on end.

Now that TV and movie viewers have better viewing options through their internet connections than they get over-the-air or through cable or satellite TV, the nature of internet traffic has been revolutionized, and not in a way that Bell and Rogers were anticipating.

Update: Michael Geist thinks I’ve been taken in by the big guys’ propaganda:

[. . .] arguments in support of UBB are frequently accompanied by the claim that the approach is like any other service — you pay for what you use. Yet Bell’s UBB plan approved by the CRTC does not function like this at all. Its plan features a 60 GB cap with an overage charge for the next 20 GB. After 80 GB, there is no further cap until the user hits 300 GB. In other words, using 80 GB and 300 GB costs the same thing. This suggests that the plan has nothing to do with pay-what-you-use but is rather designed to compete with similar cable ISP bandwidth caps. In fact, Primus has gone further, stating “It’s an economic disincentive for internet use. It’s not meant to recover costs. In fact these charges that Bell has levied are many, many, many times what it costs to actually deliver it.”

He also points out that the Canadian market is very tightly controlled by a oligopoly of key players:

While the CRTC’s UBB decision provides the immediate impetus for public concern, the reality is that the bandwidth cap issue in Canada is far bigger than just this decision. The large Canadian ISPs control 96% of the market, meaning the independent ISPs are tiny players in the market. Even if the CRTC denied Bell’s application for wholesale UBB, it would still only constitute a tiny segment of the overall Canadian Internet market.

As virtually every Canadian Internet user knows, the Canadian market is almost uniformly subject to bandwidth caps — the OECD reports that Canada stands virtually alone with near universal use of caps. The scale of the Canadian caps are particularly noteworthy — while Comcast in the U.S. imposes a 250 GB cap, Canadian ISPs offer a fraction of that number:

  • Videotron starts at 3 GB for Basic Internet, 40 GB for its next plan and tops at 200 GB for very fast speeds at $149/month
  • Rogers Lite service caps at 15 GB, it fastest service stops at 175 GB
  • Bell’s Essential Plus service offers a 2 GB per month cap, climbing to 75 GB for its fastest service

The caps are already having a consumer impact as Bell admits that about 10% of its subscribers exceed their monthly cap (a figure that is sure to increase over time). Moreover, the effect extends far beyond consumers paying more for Internet access. As many others have pointed out, there is a real negative effect on the Canadian digital economy, harming innovation and keeping new business models out of the country. Simply put, Canada is not competitive when compared to most other countries and the strict bandwidth caps make us less attractive for new businesses and stifle innovative services.

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