High Noon at the CRTC: New in Town, Players like Netflix Pose a Fundamental Challenge to Canadian Content Regulations

By Doyle, Simon | Literary Review of Canada, November 2011 | Go to article overview

High Noon at the CRTC: New in Town, Players like Netflix Pose a Fundamental Challenge to Canadian Content Regulations


Doyle, Simon, Literary Review of Canada


IN MAY OF THIS YEAR, THE CHAIR OF THE CANADIAN Radio-television and Telecommunications Commission acknowledged to a roomful of broadcasters in Cambridge, Ontario, that regulators such as the commission were losing the race against technology. The communications industry, said Konrad von Finckenstein, had "completely restructured itself," while Canada's regulatory system was created in "the previous century, before the digital revolution and before the internet." It was a frank acknowledgement from a man whose job is getting increasingly difficult. The tools in his tool kit are becoming less and less effective.

The immediate source of debate for both von Finckenstein and his audience was new content platforms that have recently made their way into Canada, online services such as Netflix and Apple TV Offering large catalogues of movies and television shows at a rock-bottom monthly price ($8), Netflix, an American website, expanded to Canada in the fall of 2010. A year later it has a million Canadian subscribers. Analysts started to predict that if Netflix added more television programming with the right to put it online immediately or shortly after it aired on linear TV for the first time, the service could compete with the broadcasting industry.

At that conference, von Finckenstein told his audience of broadcasters that they should not knock on his door asking the commission to do something about an unregulated internet. They would be better off taking those concerns to the federal government, he said, which has the power to make legislative changes to address technological convergence and to determine how to deal with so many new digital platforms. He reiterated his call for the government to move ahead with a wholesale review and merging of the telecom and broadcasting statutes.

But later that same month, von Finckenstein and his board of commissioners appeared to make a concession. The CRTC announced that it would open a consultation on new content platforms like Netflix and Apple TV. Not an official regulatory proceeding, mind you, but a mere "fact-finding exercise" to determine what impact these online platforms, so-called over-the-top services, were having on the Canadian broadcasting system--if any.

Many broadcasters applauded the launch of this consultation. About a month earlier, a secret working group representing 35 broadcasting industry executives (whose membership was later revealed to include people from BCE Inc., Astral Media Inc., the performers' union ACTRA and others) had sent a letter to von Finckenstein asking him to hold a public consultation on the issue. The regulated broadcasting industry in Canada, they suggested, was beginning to feel the heat.

The CRTC, which governs Canada's broadcasting and telecommunications sectors (and in theory, new media), regulates broadcasting by issuing licences. This is the commission's mechanism for ensuring that Canadian talent, independent production, creativity and cultural expression sustain their place within the Canadian broadcasting system, as mandated under the Broadcasting Act. If you want to broadcast on cable or over Canada's public airwaves, you must have a licence, and to keep that licence in good standing, you must abide by your licence conditions and CRTC regulations. It is a fairly simple and, traditionally, effective system.

Regulated broadcasters and broadcast distributors (that is, cable, satellite and, now, internet-protocol "IPTV" providers) face a number of requirements under the Broadcasting Act. Programmers must adhere to Canadian content exhibition requirements, ensuring that at least 60 percent of their content per year is Canadian and that 50 percent of it is aired in the evenings. Broadcast distributors are required to contribute a percentage of their revenues, normally about 2 percent to 3 percent, to funds such as the Canada Media Fund, which support the production of Canadian programming. …

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