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.
The Ontario government submission to the CRTC provides a detailed vision of regulating online video providers. It recommends that the CRTC immediately put in place “thresholds and performance measures” that would “permit the future imposition of new media TV system Cancon financial obligations.” It envisions thresholds based on the number of subscribers or subscription revenues with the goal of imposing financial obligations once a certain number is achieved.
The same submission explains why the government believes that only foreign online video providers should face these obligations (it would exempt domestic providers), noting:
Regulating foreign OTT providers with respect to Cancon would result in more symmetrical regulation, and in a significantly greater contribution to the Canadian broadcasting system with respect to Cancon (spending and broadcasting). Not expanding regulatory supports for foreign OTT providers could thwart continued growth and development of Canadian new media industries, thereby impeding achievement of broadcasting policy objectives, especially production of original/first-run made-for-new media and TV programming.
Those do not appear to be the words of a government waiting to hear from other witnesses. In fact, yesterday’s prepared remarks included the following:
“The ministry recommends that the CRTC put thresholds in place now that would permit future Cancon financial obligations for foreign over-the-top providers, as soon as the evidence warrants.”
When combined with the government’s full submission, it becomes clear that the “evidence” is a reference to foreign online providers hitting the thresholds, not the comments of other presenters. Moreover, the call for creating thresholds now would itself involve the creation of new regulations.