In the aftermath of last month’s CRTC’s zero rating decision, there have been several pieces in the Globe and Mail raising the possibility that Canadian cultural policy might benefit from zero rating Cancon. In other words, rather than rely on net neutrality rules (including restrictions on zero rating) to ensure that Canadian content benefits from a level playing field, perhaps it would be even better to tilt the rules in favour of Cancon by mandating that domestic content not count against monthly data caps.
The issue was raised during the CRTC zero rating hearing as Canadian Media Producers Association argued that:
the Commission should be open to considering ways in which differential pricing practices related to Internet data plans could be used to promote the discoverability of and consumer access to Canadian programming.
The CRTC rejected the argument, concluding that “any benefits to the Canadian broadcasting system would generally not be sufficient to justify the preference, discrimination, and/or disadvantage created by such practices.” In response, anti-net neutrality advocate Roslyn Layton argued that Canada should exempt Canadian content from data charges, an idea picked up by Kate Taylor and Robert Everett-Green.
To date, Canadian Heritage Minister Melanie Joly has been a vocal net neutrality supporter and there is no indication that she plans to change that position. Indeed, abandoning net neutrality in order to support Canadian content would raise of host issues including the prospect of increased surveillance of Internet usage, unenforceable regulations, and diminished value of Canadian content.
When Canada first debated net neutrality regulations in 2009, the Canadian cultural community was solidly in favour of it. For example, the Canadian Film and Television Production Association (CFTPA), the predecessor to the CMPA, stated:
The CFTPA submits that certain ISP traffic management practices, such as discriminatory traffic throttling, diminish the range of distribution options and degrade the quality of the Internet as a content distribution platform. If left unchecked, such practices threaten to reduce the diversity of Canadian programming that is available to Canadians. It is therefore critical that a regulatory framework be adopted that ensures that ISPs do not become gatekeepers of Canadian content on the Internet, undermining the ability of Canadian independent producers to play their role.
The CFTPA, therefore submitted that the CRTC should require “as a condition of service that ISPs refrain from employing any traffic management practice that discriminates on the basis of application or protocol.” Similar support came from ACTRA, the Canadian Media Guild, the Documentary Organization of Canada, and the Canadian Conference of the Arts.
What these groups rightly recognized was that Canadian content depends upon a level playing field against the large intermediaries such as the major ISPs that often control both carriage and content. That has not changed over the past eight years. If anything, a level playing field is more important given that a media giant such as Netflix would be granted even greater power in a system that permits zero rating since it would have the financial ability to buy access unavailable to Canadian players.
Beyond the issue of a level playing field, Taylor and today’s CMPA seem to hope that making Canadian content cheaper by reducing or eliminating data costs will increase its marketplace success. Yet the more likely outcome will be that Canadian content will be viewed not as cheaper, but rather as content that can only find an audience if the government requires that it be distributed for free. Consigning Canadian content to the mandatory free lane would send a signal that it can’t compete, the precise opposite of what Joly has been promoting.
Were the government to overrule the CRTC on the issue, it would then face the challenge of making a Cancon-specific zero rating system work. A system treating all Canadian content as data free would require Internet providers to engage in widespread surveillance of all user Internet activity, identifying the content of the bits running on their network (how to categorize video content on Youtube, Facebook, Periscope and other services is anyone’s guess). The system would eliminate private viewing, discourage the use of virtual private networks to protect privacy, and add huge costs to network services. In other words, free Canadian bits would actually be very costly, paid for in lost privacy and increased Internet access costs for all since ISPs would pass along the added costs to consumers.
Alternatively, Taylor suggests zero rating entire services that meet Cancon minimums. For example, a music service with 35 percent Cancon would be zero rated. This too raises a multitude of problems. First, zero rating was about whether a provider could zero rate aspects of its service, not if the government would require all providers to give away data for free. Leaving it to the government to determine how providers should price specific content is exceptionally problematic. Second, the system could be easily gamed as providers could simply include a sufficient amount of Cancon to meet the requirement but with no guarantees anyone would actually watch it.
Taylor concludes her column by asking what Joly might get in return for promising Hollywood and Silicon Valley net neutrality. The answer is that net neutrality benefits Canadians and Canadian creators just as much – if not more – than it does companies such as Google and Netflix.