What a Difference Two Years Can Make: Canadian Broadcasters and Distributors on the Internet

The Globe and Mail is reporting that a coalition of broadcasters, broadcast distributors (cable and satellite companies), and creators groups have written to the CRTC to ask for a public consultation on over-the-top video providers such as Netflix. The letter states:

The Working Group believes indeed, like the Standing Committee, that foreign over-the-top services are becoming a significant presence in the domestic market. It is now public knowledge that a foreign over-the-top service operating in Canada has commissioned new exclusive dramatic content, including for the Canadian market. It is buying exclusive rights with studios in the windows of certain linear Canadian programming services. Therefore, the Working Group submits that the Commission should initiate the public consultation recommended by the Standing Committee.

The fight against Netflix is likely to escalate as broadcasters and broadcast distributors wrap themselves up in the Canadian flag and proclaim the future of Canadian content depends on new regulation of online video providers complete with Canadian content requirements and financial contributions (these are the same broadcasters arguing for decreased Canadian content requirements on their own networks).

The battle has been brewing over the past few months (I wrote about Shaw’s about face on regulation in January) and what is particularly striking is how badly Canadian broadcasters and broadcast distributors understood the future impact of the Internet on their businesses. The prospect of the Internet becoming a substitute for conventional broadcast was not exactly a secret at the new media hearing in 2009. In fact, I wrote about the hearing and the Internet streaming of movies in back-to-back columns just before the hearing started. But consider the comments of Canada’s broadcasters and broadcast distributors then and now. Earlier this month, Shaw told the CRTC:

The threat today from over-the-top television is alarming. It stems from major structural shifts in technology and rights exploitation that are permanently reshaping the global broadcast landscape. Google, Netflix and Hulu launching into the TV industry is only the beginning of what we can expect. Any attempts by these new entrants to characterize their presence here as merely complementary to ours is disingenuous. We are now competing head-to-head with OTT players within all key areas of our business, whether program acquisition, subscription fees and advertising revenues.

Just two years ago at the new media hearing, Shaw’s view was quite different:

It is not primarily broadcasting. You would not use the Internet. If you were building a broadcasting system right now, you would not use the Internet to do that. You would use a cable system, a broadcast system to do it, satellite, whatever. Those are the ways to do it. What people are using the Internet for primarily is self-generated content. It’s not professionally produced broadcasting. And we can all observe it in our own homes or with our own children. So I guess the problem we have is when you say we are not talking about regulating the Internet, I understand what you are saying but you are by just raising the question of, you know, are incentives or regulatory measures necessary or desirable for the creation and promotion of Canadian broadcasting content in new media, and all we are saying is no.

Shaw was not alone on this. Bell Media had this to say to the CRTC last week:

Make no mistake, so-called over-the-top services, or OTT, they are indeed formidable competitors. For example, Netflix recently announced that in less than a year of operations in Canada it had amassed over one million subscribers in this country. Of course, this is impressive by any standard, but if you add that to the more than 20 million customers they have south of the border, Netflix has achieved unbelievable scale in just a couple of years. This massive scale, and an advantaged cost structure, allows Netflix to outbid Canadian broadcasters for exclusive program rights, both online and on television.

In February 2009, Bell’s Mirko Bibic had the following exchange with CRTC Vice Chair Len Katz:

COMMISSIONER KATZ: But surely you recognize that just as you and Rogers and this morning we heard Quebecor Media say the same thing, you are concerned about it and that is why you are looking at this more holistic access to the various screens for one price because the concern is that if you don’t do that you may, in fact, start to lose part of your traditional business, if I can call it that, to this new form of business.

MR. BIBIC: Well, we may, but on the other hand it may never become a substitute, in which case the risk that you are putting forward as a hypothesis may never materialize. Now, I am not quarrelling or criticizing the Commission for looking ahead and getting ahead of the issue because it wouldn’t be my place to do that. I have criticized the Commission enough for not looking ahead. But based on the evidence that has been put forward in this proceeding, in the written proceeding and the oral part of the proceeding, I don’t see any evidence that there is that substitution effect yet and it may never transpire.

Not that Rogers was any better:

So the online world is more and more turning out to be complementary and ancillary to the old media world. I am not minimizing the fact that it could be a threat, and that business operators like us have to run our businesses carefully worried about that competition, but if we run our businesses properly and your regulations are sufficiently flexible, I think we can use the online world as a complimentary medium not as a competitive one. If it becomes a competitive threat, if the people are truly substituting — cancelling their cable television subscription because they only have Internet, if that world comes, then I think we might have to take another look at these gloomy propositions, but right now I don’t think it’s necessary.

CTV didn’t get it either (though CRTC Commissioner Konrad von Finckenstein clearly sees it coming):

CTVglobemedia really view the Internet and our web broadcasting activities as something that is very complementary to what we do, that being broadcasting both on conventional and specialty. It really serves, as we pointed out, to be a great promotional vehicle, we use it extensively for that. It serves as a great opportunity for catch-up and, so as opposed to having — and maybe if it does have an impact, I would say it has a positive impact in that it provides that opportunity for viewers to both catch up and also understand and have the ability to interact with what we’re airing on conventional and specialty television. But we believe and we continue to believe that our core business and our foundation is really broadcasting in the traditional forms of conventional and specialty.

THE CHAIRPERSON: And you don’t see the day coming where you deliver your product more over the Internet, over your ca website or through some aggregator rather than over the traditional cable or over-the-air?

MR. BRACE: I think, Mr. Chairman, none of us has a crystal ball in that respect, but I think that for the foreseeable future, you know, even despite the turmoil that we’re in and the issues that we face in this environment — and, you know, we’ll be talking about that at a later hearing most certainly — that conventional and specialty television as we have known it will continue to be relevant.

Of course, given their views that this Internet thing was no threat to smart business operators, Canadian broadcasters and broadcast distributors unanimously adopted the position that the CRTC should not establish new regulations for Internet-based broadcasting.  Consider:

  • Shaw: “There is more Canadian content on the internet than on television, more Canadian participation and more customer control. The beauty of the internet is the power of the customer. The customer should be trusted to make their own Canadian content choices. We are a successful company because every day we engage our 3.4 million customers and try to listen to them. We ask the Commission to do the same as it listens to all Canadians and to not try to re-regulate or to change the structure of the internet now.”
  • Bell: “The internet and mobile networks provide new ways for Canadian content to reach Canadians. Traditional broadcasting distribution channels continue to be available and, in fact, have not even declined in the face of new media’s growth. Without a doubt, new media allows broadcasters and content producers to reach Canadians more quickly and directly. Under the circumstances, the appropriate course of action is to maintain the new media and mobile exemption orders and continue to monitor the situation to ensure that new media develops on a healthy course without regulatory intervention. The Broadcasting Act does not mandate that anything be done to change those exemption orders and, based on what we have heard, we believe nothing should be done.”
  • Corus: “Imposing a regulatory system of conditions, tariffs and quotas on new media participants will not promote a greater Canadian presence in new media. In fact, it is likely to have just the opposite effect. For this reason, Corus is of the view that the existing new media and mobile television exemption orders remain appropriate now and for the foreseeable future. There is no need for new measures or amendments to these exemption orders.”
  • Telus: “With all due respect, what is being proposed by some parties in this proceeding is nothing less than the regulation of the Internet, whether via quotas on online Canadian content, non-net neutral preferences for Canadian content online, or simply the application of a tax. It would be an understatement to say this would be a slippery slope. Broadcast-style regulation is not compatible with an open Internet, no matter how benign the initial intention to regulate.”
  • Astral: “COMMISSIONER CUGINI: Therefore, the point being that they should be regulated or they should not be regulated? MR. BELL: I mean, our point is no, that they should not be regulated. This is an open platform. I mean it’s hard to imagine that you might regulate a consumer brand like Kraft or Mazda who is producing compelling audio-video content on the Web, which is a space that we also occupy.”

All of this came just over two years ago. The new coalition may want immediate action on Netflix, but the CRTC should take them at their word from 2009 and indicate that the next review of new media regulation will come – as promised in the last new media decision – in 2014.


  1. Hands off the Internet. The Broadcasters may push to regulate NetFlix, and probably AppleTV and GoogleTV by saying it all must be treated equally, with NetNeutrality folks on their side but hopefully, the CRTC will be able to treat it as a new media, more like they did with internet telephony. (With internet telephony they did have some regulation like e911 and number porting etc.)

    This is why politically backed NetNeutrality to hurt products. We don’t need more regulation to stifle innovation let technology an people with new ideas succeed.

  2. Brent Hannah says:

    Why can’t they compete?
    The playing field is level. The infrastructure that Netflix is using is available to these telecoms. In fact the telecoms have better access to this infrastructure. If the Telecoms can’t compete it’s not the government’s or the taxpayers’s problem.

  3. So now that they see their business model being threatened, they want to regulate it, but before it was fine? Figures. When you can’t compete, try to regulate your competition out of business.

    As for Canadian content, I still more Canadian content on Netflix than I ever did on any of the Canadian broadcasters. Other than the CBC that is. So not, it’s not really needed, they just need to learn to keep up.

  4. waaaahhhhh
    “We have been unsuccessful in ramming 500 channels of crap down our customers throats at excessive prices just so that they can get the 3 or 4 channels that they actually want. Now Netflix wants to come in and give customers only what they want and only charge them the cost of what they want (and not all of the other crap they don’t want).

    It’s not fair Mr. CRTC. You must stop this or else we won’t get to keep raping and pillaging the Canadian content consumer.”

  5. Denis McGrath says:

    The Truly Amazing Thing About This…
    …is the very “artists groups” they pooh-poohed calling for regulation in 2009 saw this coming as not likely, but an inevitability.

    In conversations what came out was (thinking about Mad Men, which had just put AMC on the map) that the smartest thing one of these services could do would be to commission content that was exclusive to their platform. Ape the HBO model. We all agreed this was inevitable.

    So how is it that a bunch of so called “creatives” were out in front on this when all the King’s lawyers and regulatory wonks were behind?

    All of a sudden, the painstaking work done to try and get the Supreme Court to hear arguments about why Internet Providers should be regulated under the broadcast act — a position on which we stood alone — doesn’t look so dumb. It looks prescient. We were right about this, just as we were right about how the 1999 policy change would kill drama overnight.

    How is it that an organization like the Writers Guild of Canada — with 18 employees total — sees what Bell and Corus and Shaw and Rogers and their phalanx of lawyers cannot?

    I’d put it down to the fact that we’re all freelancers. I know for the purposes of CRTC bashing it makes great sense to portray us all as flaky, undisciplined artists…but the fact remains that I pay taxes — quite a lot of taxes, actually.
    As a self-employed small business owner, I move from project to project having both to anticipate the changing needs of the client, the taste of the market and the trends that are ahead, not behind me. Oh, and I take notes. From everybody. Lots and lots and lots of notes.

    Contrast that with businesses that apparently failed to plan for a downtick in advertising during a recession, who hectored the CRTC to give them money from carriage fees because they couldn’t run their businesses any other way, who can’t make money off local news despite the fact that that’s the major moneymaker for TV in the USA, and who now are forced into the position of trying to paint themselves as the savior of CanCon out of one side of their mouths while they nickel and dime out of the other.

    And as always, the only people not getting anything out of this system is the Canadian viewer at home. They’re gouged with high prices for a poor-quality product that consists mainly of U.S. shows they already get on U.S. network feeds.

    Say what you want about the philosophies of CanCon regulation, but all we’ve ever argued is for a balanced system.
    The problem is that these companies want all the protections they’ve historically been afforded, and yet they don’t want to step up to the plate and live up to their obligations. It’s the oldest story in the book. But the CRTC has been rolling over for them for so long that they have every expectation that will continue.

    In their bubble, then, there need be no consideration of how the playing field is changing.
    The ironic thing is that these shameful policies have taken the truly forward thinking people in this debate and consistently driven them south, for more than 30 years now.

    Canadian television is being made. It’s just being made as American TV and filtered back to Canadians. The creators of Bones and House, writers for Letterman, Colbert, Jon Stewart, writers for The Simpsons, How I Met Your Mother — you name it; it’s being done by Canadians. But they’re not paying taxes here. They’re not adding to the culture or the framework here. The system has led to their forced economic migration.

    Now. How many telecom lawyers or broadcast execs are draining south? How many of these brilliant Canadian lawyers are making the same trip on the backs of their groundbreaking thinking?

    I wonder at this point whether it’s too late to save any kind of Canadian TV system. The brand is too damaged in the viewers eyes.
    Meanwhile, the people who saw it coming look for seat sales to Los Angeles.

  6. Seriously?
    How can any sane person look at these comments from the Telecoms, and then at what they’re doing with their internet service (UBB, throttling etc.), and not come to the obvious conclusion that it is anti-competitive for broadcasters to own ISPs?

    That and the fact that the broadcasters will try and make some bullshit argument about how they want to protect Canadian content really makes my blood boil.

  7. Don’t regulate us! Regulate them!
    two years ago, our munificent Canadian Broadcasters and distributors saw internet distribution as a nice ripe plum on the horizon and didn’t want anyone gumming that harvest up… Now that Netflix is sucking the jam out of their donut, they need help!

  8. CRTC can’t regulate Americans
    Even if they “regulate” it that won’t matter. Netflix is American and this deal they cut with Paramount (for example) is again with Americans.

    All Netflix needs to do is tell the comission to fuck off. Von Finklturd will have serious reverations about taking an issue like this to the WTO and rightfully so since it’ll make Canada look horrible.

    Netflix should even ban all Canadian programming from the CDN and US service NOW to send a msg to Canada they’re not to be messed with.

  9. Why can’t they compete?
    @Brent “The infrastructure that Netflix is using is available to these telecoms.”

    Its not that they CAN’T compete its that they don’t want to. The Netflix model eats way too much into their cable and pay-per-view income. Sure, their is more and newer programming on those systems than Netflix but many people (myself included) find the value so great that the cord cutting was a viable decision.

    And who really needs another episode of the biggest looser anyways 😉

  10. Mr. Angry Consumer says:

    A nail was never hit more soundly on the head than the comment by Denis McGrath! Our household decided a number of years ago to abolish television subscriptions completely. While at the time it was painful – we survived. Guess what? There is a growing segment of the population that will NEVER subscribe to an old model broadcasting service! I’m reminded of an old Seinfeld episode (The Revenge) where George Costanza is told by his now ex-boss: “I’ll always be a winner, and you’ll ALWAYS, be a loser.” The incumbents are now in the position of George, showing up to work pretending that he hasn’t been fired.

    We fired the incumbents, and their manoeuvres now, are nothing more than the flopping of a fish that doesn’t know it’s dead yet. You see, we’re awake now, and we’ll always be awake now.

  11. And on the topic of loosers …
    I have been saying for a couple of years now what a horrible idea it was for the Telecom industries to be buying up Canadian broadcasters. They must have thought that they could count on their CRTC buddies to keep those pesky ‘innovators’ from being too much of a bother.

    Just like the politicians in this federal election, there is a generational misunderstanding of the power of internet enabled social power. The speed and effectiveness of openly disseminated public opinion is a force that can no longer be ignored. The old back room, pass the cigars, way of cementing your control is a fast dying ‘meme’ 😉

  12. Alan Langford says:

    If firms who distribute programming over the Internet have a “significant cost advantage”, can’t the existing oligopoly achieve the same advantages by distributing their programming over the net?

    Oh, wait, that would force them to admit that their usage-based billing arguments are ridiculous. Can’t have that. These players want to suck and plow at the same time. We can only hope they asphyxiate in the process.

  13. Can’t support this…
    And this is why I handed in my 2 weeks notice today at this giant Telecom company I work for. I can’t support people that are so out of touch and only care about a service that fewer and fewer people want. I see it everyday with the loss of cable subscribers.

  14. When I hear of those who complain about their $100/$150 per month cable or satellite tv bills going up again I can’t help but LOL. I shut down my satellite TV service over 2 years ago and the only thing I miss is watching the same commercial at a mind numbing volume six times in a row.

    My grandmother once told me “You don’t learn anything if you are always talking”. Those high priced Shaw/Telus/Rogers “experts” are no different from all those “expert” economists who didn’t see the financial crunch coming. They have zero credibility.

    Perhaps if they spent more time on the internet, read some blogs and visited a few forums they would learn what is really happening out there.Let’s give them a primer. We only need them to connect us to the internet – nothing more. That’s why we reacted en masse when they tried to impose UBB. They now want the CRTC to regulate the internet? Let’s regulate internet connection fees with realistic plan limits based on their true data transfer costs.
    All Netflix has done is wrap some old movies in a fairly priced consumer package and distributed it over the internet. Why didn’t Sony and the gang do this themselves? Oh right, they were too busy suing their customers and lobbying world governments to criminalize “piracy”. Shaw and Rogers own lots of programming now – why don’t they set up their own internet services? Oh right, they are afraid it will cut into their overpriced tv “packages” as people may only buy what they like rather than having to pay for stuff they don’t want (with those noisy commercials). They should read the business case studies of Kodak and Polaroid and do a Wiki search for “disruptive technology” to see where they are heading. The CRTC won’t save their outmoded business model. The internet is international so if they do succeed in their goal to regulate the many Netflix’s that will appear in the future, new VPN type services will pop up and Canadians will send their money out of the country just like they used to send their money to Direct TV.

    By the time they realize they HAVE to change it will be too late. But they will still have their cell phone services to milk the public with – that is until the network of wifi hoptspots becomes large enough that we can again bypass them with our wifi cell phones.

  15. @bobbus: “All Netflix has done is wrap some old movies in a fairly priced consumer package and distributed it over the internet. Why didn’t Sony and the gang do this themselves?”

    Sony actually does it, via Playstation network. The issue is pricing. Netflix wants $8.99/month all you can eat while Sony wants $5.99 per movie.

    The “copyrightz” owners like Sony, Warner Bros, Universal and so on sold the wholesale “rightz” to Netflix at a way too low price and now they just can’t believe what a mistake it was. It completely devalued their retail business.


  16. @Nap “sold the wholesale “rightz” to Netflix at a way too low price”

    Actually, I think they sold it at a realistic market price which is why people are no longer willing to pay the ‘forced package’ cable pricing model anymore.

  17. Crockett — old politics is dead, is it? So that must mean the big youth-oriented, tech-savvy party is going to win? Good to know. Now I can place my wager.

    Shawful — I am sure your principled resignation from Big Telecom will be the straw that finally breaks this camel’s back.

    Viva la Revolución!

  18. Viva la Revolucion!
    @Degen I wish you could know what difference it will make.

  19. So tell me.

  20. @Degen Not on a forum on the internet before transitioning to a new role with a new company.

  21. Very good post today, Michael. I guess the Canadian broadcast industry can be best described as short-sighted and schizophrenic or, in lay terms, crazy.

    By the way, have heard of “CTV-Flix” – all you can eat streaming movies for $4.99/month!

  22. @Crockett: “Actually, I think they sold it at a realistic market price which is why people are no longer willing to pay”

    Nope, it was a mistake from the part of the movie studios.

    Let’s say you have an established business that sells widgets at $29.99 MRSP (Blu-Ray and DVDs in their prime time), with an alternative discount channel at MRSP $5.99 (rentals, video on demand, “2 for $10” bins). Say you’re cashing P of MRSP which makes for a revenue of either $14.98 or $2.98 per widget depending on distribution channel.

    Now you sign a contract with someone allowing him to sell your widget @ less than $0.29 (that’s viewing one Netflix movie per day).

    Obviously now nobody wants to buy at the higher prices, and your revenue is pretty much screwed up, and your traditional distribution channels are scrambling to find a fix.


  23. @Napalm
    You make it sound like they had a choice. It’s a capitalist economy with many players. If Universal didn’t want the cash for the content then Warner might be interested. Or BBC. Or any number of other players.

    Plus their business model became over saturated by their own doing – forget $5.99 I’ve seen plenty of DVD from as little as $1-3 through the years (paid $2.99 for Terminator myself at Giant Tiger). Then there’s the used market – some titles as little as $1

    Most things decrease in value as they get older and the industry just made reality crap since it’s cheap to make to replace the old stuff. They stepped down the value of media years ago so why are they suprised when the customer isn’t willing to pay as much for it.

  24. Tom Switzer says:

    Netflix & Canadian Content
    What’s funny is that I watch more Canadian content on Netflix than I ever did on cable. Serisouly, between Republic of Doyle, InSecurity, Heartland (my wife, I swear), The Tudors, etc. I don’t really have a need for American TV. If they are seriously worried about Netflix, may be they should try competing. And, no, a $70+/m package isn’t a replacement for a service costing $8/m.

  25. Tony Havelka says:

    The Broadcasters must protect their position as the dominant channel for visual media consumption in Canada. To do anything less would be a great disservice to their shareholders. The CRTC can impose any restriction they want on internet video services but how will they enforce them? Netflix is a foreign company, based in a foreign land, and serves all of its data from foreign controlled servers. All CRTC restrictions will do will stifle development of domestic streaming services and force them to move to other “more favourable” countries.

    When physical goods cross the border, the fine men and women at the Canada Border Services Agency review and inspect them to make sure they comply with Canadian Laws and proper duties and taxes are applied to the importation. Will the CRTC enlist the services of the CBSA to inspect every digital packet sent over the boarder to make sure it complies with CRTC directives? It’s done in China so it’s not that far of a stretch to think it couldn’t be done in Canada. It probably wont happen though. But maybe, the CRTC will leave that task to the large ISPs, which are owned by…the Broadcasters.

    The CRTC needs to do what is right and make Canada an inviting place for digital innovation and foster growth of new technologies and digital services. They need to make the “old media” environment so restrictive and unpleasant that the current players in the traditional media market are forced to jump to the digital world or toil in that old world they have been carefully crafting over the past 50 years.

  26. @nonoma: “You make it sound like they had a choice. It’s a capitalist economy with many players. If Universal didn’t want the cash for the content then Warner might be interested. Or BBC. Or any number of other players”

    I’ve never seen them offering their stuff @ $0.29 on any other distribution channel. Call them and ask if they license you to watch all their movies at this price.

    Of course there are some competition laws that say that this price should now be offered to everyone. So if I were Bell I would look into licensing the same content as Netflix under similar conditions and price then put everything on on-demand IPTV for the same $8.89/month. Since now you’ll be streaming from a local Bell server the quality will be better, moreover it would be via the IPTV channel which Mirko managed to convince CRTC that “is different than Internet” so it’s not subjected to caps and throttling so you would watch everything in HD.

    And a cable company could set up an extra channel to run all those Netflix movies in a big loop.

    Any chance that Netflix could survive?


  27. @napalm
    I don’t need to call them – Netflix did and enough companies said yes. If Bell wants to try to strike a similar deal they’re welcome to do so however it’s the studios content so it’ll be up to them to decide to sell.

    As far as Netflix surviving since they can do stuff like this recent Paramount deal came out I doubt you’ll have to worry about them.

  28. @NoNoMa: “If Bell wants to try to strike a similar deal they’re welcome to do so however it’s the studios content so it’ll be up to them to decide to sell.”

    Now that’s an interesting discussion. There are some competition laws that specify that you cannot deny access to an abundant product to select competitors, either by refusing to supply or asking unreasonable prices.

    What makes it very interesting is that the suppliers are American corporations.


  29. @Napalm
    Exclusive media has become the norm. From games released only on one platform to how TMN has exclusive content to most of the Showtime shows. Nobody is saying Paramount didn’t have the right to sell exclusive rights to – just that Netflix should be treated as a pay tv operator because of it.

  30. Jean-François Mezei says:

    1- such decisions are way above the crtc’ pay grade.

    2- of cource the incumbents will try to protect their high profit margins. the have a duty to their shareholders to do so.

    3- these high peofit margins are the result of lack of competition.

    4- if Canada had had a real digital strategy, netflix would have been a canadian company that exported its services to the USA. We need an environment where canadian companies can not only be competitive, but also lead the industry. We must not allow old incumbents to prevent that from happening.

  31. @NoNoMa: “Exclusive media has become the norm. From games released only on one platform to how TMN has exclusive content to most of the Showtime shows.”

    Games (and software in general) are unique to the platform (and please don’t lecture me on java, console games are not written in java). There’s no law that says that you have to write versions of your software for each and every existing platform. But if you have lets say a PS3 game that you sell to Game Stop but not to Best Buy you’re in for a lawsuit:

    In the case above HMV lost because it was about exclusivity on a single item over a limited time period. With Netflix we’re discussing about the entire back catalog of major movie studios.

    TMN is a different story. It has “exclusive” content in the sense that it’s not made available separately, but TMN the channel as a whole is available to all cablecos to license and broadcast. If TMN would come up with a stunt like “we will license to everyone except Videotron” they would be in for a lawsuit.


  32. @Mezei: “if Canada had had a real digital strategy, netflix would have been a canadian company that exported its services to the USA”

    Don’t forget that the major movie studios that licensed content to Netflix are US based. Do you think they would have cut such a sweet deal to a Canadian company?

    BTW are you the same guy that posts on dslreports with a funny avatar?


  33. Memo to Whining Canadian Broadcasters
    You had your chance now fuck off and let the rest of the world innovate and stop running to the government every time your business model is threatened by people that think and compete.

    Did I mention for you to fuck off.

    Really I am so tired of this Canadian content bullshit and the constant shackles the CRTC and broadcasters themselves continue to wield over innovation and the future of the digital information.

    Just so we’re clear Canadian Broadcasters. Fuck right off.

  34. Brent Hannah says:

    Just wrote a letter to the Edmonton Journal about this
    Re: TV industry targets Netflix (April 15 2011)
    Just weeks after having their wrists slapped by the Harper Government for acting as hired guns for the big Telecoms, the CRTC is at it again. Now they want to bury the competition (Netflix specifically) in red tape to stop them from offering an affordable choice to consumers (that’s us folks).
    The Telecoms (Shaw, Rodgers, Bell, Telus, etc.) claim they want a level playing field, but the truth is that the playing is already more than level. If anything it’s slanted against the competition (Netflix, Youtube, etc.), and yet they still can’t compete. These internet content services use the same infrastructure that is available to the Telecoms, in fact the Telecoms have far greater access to this infrastructure. So if you can’t compete the obvious solution is to a) offer a better, affordable service using their superior resources or b) lobby the CRTC to kill off the pesky interlopers. Guess which way they are going? And why not, the CRTC has been their lap dog for years and that shows no sign of changing anytime soon.

  35. NARROWCASTING for the love of god use the right term. What Netflix does was coined by media experts decades ago where they predicted it’s inevitable replacement of broadcasting. Do the research.

  36. Another insightful piece, and your conclusion brought a wry smile to my face. I just wish that this type of understanding could be infused into the brains of “most” people’s brains. As is, some politician is bound to get involved in this, wrap a flag around their head, and try to regulate the future away.

  37. See here:

    When it’s about US – Canada disputes, if US can’t win by existing rules then they’ll misinterpret or change the rules until they can win.

    As with Netflix. The US “copyrightz” owners licensed their stuff to Canadian broadcasters at full price, then licensed them again with a huge discount to Netflix (for extra quarterly income and bonuses). And we keep shouting at ourselves. Duh.


  38. @Napalm
    Honestly nobody cares about your claims of unfair pricing. Bell/Cogeco etc are the ones with unfair pricing by charging the average Canadian $80 for their cable.

    Netflix is giving the customer good value.

    Bell could have done Netflix before Netflix did and sold us a service for $8/month but they’d rather keep fleecing us by charging $80/month.

  39. Only here…
    Would an issue that is clearly between Canadian broadcasters and tv producers and non-Canadian “OTT” services be blamed on the US studios…

    Napalm said: “The US “copyrightz” owners licensed their stuff to Canadian broadcasters at full price, then licensed them again with a huge discount to Netflix (for extra quarterly income and bonuses).”

    Actually in most cases the broadcasters in question also obtaining the Canadian “digital rights” as well… Hence why only some content is not available on Netflix in Canada when is available in the US.

    I’d also point out that your odd competition law reference would not only not apply in circumstances where IP is licensed (which happens frequently), but that the example you cite actually cuts against the point y were appae toy trying to make…

  40. NoNoMa: “Netflix is giving the customer good value.”

    It actually isn’t, otherwise we would be just using it with no further discussion here and elsewhere.

    It is pretty much like those e-bay “deals” where an item that costs $10 on the streets is listed for $5. Sounds like a sweet deal until you realize that shipping is $10.

    And then we’re all up in arms to regulate UPS and Purolator to lower their prices.


  41. Why is Canada not considering a National Broadband Network like Australia is implementing?
    Why is Canada not considering a National Broadband Network like Australia is implementing?

    We’re similar in geographical difficulty of implementing such a task; *relatively* similar populations & densities. It seems we could be discussing a project like this as well. Yet nobody here seems to know about the possibility! We need to get discussion of such a plan into the public forum; that would further pressure the incumbent networks to be a little more reasonable.

  42. @Julian: “Why is Canada not considering a National Broadband Network like Australia is implementing? ”

    Are we prepared to pay for it? Would we vote a party promising a substantial tax hike for the next 4 years that will be used for building it?

    Don’t you see that all discussions here are centered around prices? Everything is unfair and too expensive? We want the fastest internet on the globe, but free of charge, please?


  43. Screw Canadian content
    I and probably 80% of other Canadian don’t care about Canadian content. Really I don’t care where the content comes from and who made it, I just want quality content. Give me quality content and I will pay. I’m actually in the process of convincing my wife to get rid of SHAW cable and go with over the air for local news and then the rest through a cheap notebook hooked up to the internet and played through the tv. Instant content we can pick and choose. With a cheap VPN account and an US IP address we got everything covered. Yup that how much I care about Canadian content.

  44. …”Don’t you see that all discussions here are centered around prices?”

    Nap, to a certain extent you are right. But that is only because we got into motivations of the incumbent broadcasters/ISP’s. If they were different entities, the discussion would likely be quite different.

    What is lost in this discussion is that the CRTC regulates broadcasters and ISP’s, and does so under different sets of “rules”.
    So what exactly is Netflix? Is it a broadcaster? Or an ISP? Or something else entirely? It’s obviously not an internet service provider. It’s not a broadcaster either. The closest analogies we can find to current services is an online video rental with instant delivery, or the Pay Per View as offered by some of the incumbent services.

    There is a very big difference between a broadcaster, and PPV or Video rental services. The customer chooses, at a very granular level. If PPV is required to “offer” a certain amount of Canadian content as selections it still doesn’t force the customer to choose it. If a video rental store is forced to “offer” a certain percent of Canadian content, the customer is still in control of their selections. In the case of a broadcaster, the user has a much more limited choice, the on/off switch or the channel selector. And the broadcaster is paying for it, regardless of the position of the switch(es). So is the customer.

    So, what content regulations are currently applied to PPV or Video stores? They are the only analogies that come close to applying.

    Now, if we get back to content pricing we find that the broadcasters are paying for licensed content, even if every single subscriber has the switch set not to receive that selection. Not so in the case for PPV, Video rentals, or Netflix. The content license can be directly mapped to the amount of “views”.
    There are lots of different pricing models that can be applied when you have this level of information, although I am in no way privy to the model(s) that Netflix has arranged. It could very well be that they have contracted a monthly “price cap” for certain content, so once it has reached that many “views” it is effectively free for any further “views” in that month.

    The fact of the matter is that Netflix is a direct competitor to PPV and Video rentals, and perhaps DVRs. Not broadcasters. It just happens to make much of the broadcast content totally irrelevant in our modern world. The only thing really left is live content (News, etc). If Netflix, through contracts and economies of scale, can offer better pricing to the customer, then it isn’t a fault of the “system”. Nor should it be “regulated” any further than PPV or Video rental outlets are regulated.

    The “problem” we have with the NetFlix model is that most of the ISP’s in Canada are also broadcasters or content providers. From an ISP perspective, they should welcome a Netflix model (more *really* high speed connection subscriptions). From a broadcasting perspective they see the end of their business models. The only option left is to become pure ISP’s, with perhaps a sideline for local “live” streaming content. Are they scared? You bet. UBB was the first salvo in that direction, now asking for CRTC regulation of the OTT (Neflix) model is the second salvo.
    Could the incumbents compete with the new models? Certainly. How about a partnership? I’m sure of it. But the “profit margin” is much smaller. Protecting the historical profit margin of the incumbent ISP/broadcaster’s is what all these salvos are about. And we are back to “prices” again. Price protection of a historical business model faced with the advent of a disruptive business model based on new technology capabilities.
    Would you like Canadian society, including businesses and customers, to move forward into the global digital age, or get left behind? That’s really what the choices boil down to.

  45. Pray tell?
    @Degen – “Crockett — old politics is dead, is it?”

    No, not dead … just moving into that ‘mature’ generation that has trouble programming the VCR ;D

    It is a natural progression, the new is the vice of the young. It is still true that the young generation are less inclined to vote but they are also more easily motivated by mass ‘movements’ and even peer pressure to conform to the issue of the moment. This has always been the case but now technology enables this at a faster and much larger scale than ever before. Those who do not understand this will scoff, the old ways are eternal. Now, refresh my inkwell Squire boy.

  46. Future Shock
    This whole issue is simply another instance of “Future Shock”. We all see it constantly, in small scale and large. From individuals to industries to complete societies. It comes from looking at technology advances simply as ways to do what they are already doing, in a better fashion. Myopic to say the least.

    What of the millions of people that have already had their jobs and businesses disrupted or made irrelevant? What about the billions yet to come? Does anybody care? Should they care? Frankly, that is the way it has been all down through history. People adapt. Businesses die or adapt and new ones are born. Whole societal structures shift and change. That’s simply the way things are. Yes we, as a society, should care. Care enough to assist anyone willing to adapt. If there are individuals or businesses unwilling to adapt, then caring won’t help them. As a society, we need to focus our resources on where they will make a difference as we advance into that future – for all of us. Government policies should reflect that inevitable direction, keeping the transition as smooth and organized as possible.

    Look back over the last 20-50 years. There are lots of lessons to be learned and lots of businesses and whole industry casualties from those that got “blindsided” when the future caught up with them. They were complacent. They saw the little things where advancing technology allowed them to leverage more profits (or lower costs), but still they ended up a casualty. What mistakes did they make? They looked for ways to do the same *kinds* of things they had always done, but do it better. As far as they were concerned, that made them “modern” and “future looking”, both companies and individuals. And the future rushed right by them by making the very *kinds* of things they were doing, irrelevant. Myopic until the very end.

    Is Netflix a disruptive (a new *kind* of thing) business model? Yes. Has it blindsided the current broadcasters and content distributers? Apparently. Should we care? Maybe, it depends on how much they are willing to adapt to the new world foreshadowed by Netflix and others like them.
    How much they are willing to adapt or compete and/or partner with these new models? For all their self congratulatory progressiveness in adopting new technology, why is it looking like they got blindsided? What lessons have they learned? And can they implement those lessons quickly enough to stay relevant?

    Yes, this is big. Bigger than most here seem to realize. And it’s inevitable now that the path has been pointed out. But we have even bigger changes yet to come.

    Our very government processes are due, soon enough, to be affected by a “sea change” because of advancing technology. This will affect the very foundations of our society. I hope there are enough people that realize that these advances are not simply a “better way to do old things”, but brand new *kinds* of things that could never be done before. New approaches that simply make the old ways irrelevant. It’s a small hope, because if there are any organizations that are even more myopic than businesses and industries, it is typically governments and the bureaucratic processes they foster. Still, there are signs that some of our representatives “get it”, even if it isn’t the hottest platform agenda in an election.

  47. Well said Oldguy. Though sometimes the effects of technological change is overstated by its proponents, it is less so than the denial of the naysayers.

    Buggy > Auto
    Typewriter > Word Processor
    CD > Digital Downloads
    Autocracy > Democracy

  48. @Napalm
    No Netflix is good value for many. Otherwise 1 million Canadians wouldn’t subscribe already along with millions of Americans.

    The scam is the $80 your bosses at Bell are charging.

    With this bizarre statement as well as your critizing a National Broadband Network I think it’s clear you’re just astroturfing for Bell and the industry.

    If you don’t like Netflix – don’t subscribe but it’s none of your business if I do.

  49. ..”Though sometimes the effects of technological change is overstated by its proponents, it is less so than the denial of the naysayers.”

    Certainly. For the most part technological advancement comes in small steps, easily integrated into organizations to allow them to “do old things better”.
    But every once in a while there is an “aggregation” effect that allows brand new kinds of processes or ideas to emerge. Sometimes it can be attributed to a single large step, but more often it is the gradual accumulation of a pile of small steps. Steps that everyone understands. But then someone comes along, looks at the whole collection, and they see brand new kinds of possibilities.

    If an individual only focuses on the small steps, they will never see the idea that makes everything they do irrelevant. Blindsided. If they only focus on the “game changers”, they will too often assume that every little step is a “sea change” and be disappointed. Although understandable, neither one is a realistic assessment. Both views are right and wrong – at different times.

    From a business (and to some extent an individual) perspective, it is better to error on the side of assuming every little step could be the one that shoots a hole in your business/job model. At the very least you can start preparing contingency plans. And who knows, those contingency plans might contain the seeds of an idea for a “sea change”, and you got there first.