Canadians could be forgiven for thinking that the policies associated Cancon in a digital world largely wrapped up with the release of the government’s policy in September. Canadian Heritage Minister Melanie Joly spent months crisscrossing the country, meeting with hundreds of stakeholders, and ultimately delivering a high profile policy that featured the much-debated Netflix commitment alongside various plans to support the sector. While Joly also promised reviews of the Broadcasting Act, Telecommunications Act, and Copyright Act, she puzzlingly re-opened the very issue she had just decided by issuing an Order-in-Council to the CRTC to examine (yet again) policies associated with broadcasting.
As a result, Joly restarted the same policy fight over everything from ISP taxes to net neutrality. The first stage of the CRTC’s consultation into the issue (it is charged with reporting back to cabinet by June 2018) has yielded nearly 300 submissions, many of which envision extensive Internet regulation and taxation. I provided a submission to the consultation, which will be the subject of a blog post later this week. My full submission, which focuses on maintaining net neutrality and rejecting new taxes and fees, can be found here.
While there is much to digest, a quick scan of many of the submissions reveals that the usual suspects are seeking the same rejected remedies raised in the just concluded consultation: ISP taxes, Netflix taxes, iPod taxes, and killing net neutrality. In fact, the submissions add new taxes to the discussion such as a Spotify tax, data sharing of viewer data across the industry, and the creation of a website blocking agency.
For example, the CBC veers strongly toward increased regulation. It is one of many that wants ISP or Internet taxes, including payments from both broadband and wireless providers to support Cancon:
both Internet Service Providers (ISPs) and wireless carriers should be required to contribute to the support of Canadian content since they provide access to programming through their services and profit significantly from the ongoing popularity of programming over both landline and wireless networks.
The CBC is joined by many other groups: ACTRA wants mandated contributions and the creation of a new licensing regime, CMPA supports contributions from broadband and wireless carriers, and Rogers wants Netflix to spend 30 percent of its gross revenues in Canada to finance Canadian productions.
The CBC also wants widespread data sharing of viewer data, noting the mounting importance of data analytics. Its submission calls for a new regulatory regime to mandate sharing of viewer data:
the regulatory regime should ensure that such data is readily available on a non-discriminatory basis. In particular, data about Canadians and their programming preferences should not become the exclusive property of a select group of players. This data should be available to all players so as to benefit the system as a whole.
The Canadian music industry also focuses on data, with the Canadian Independent Music Association demanding that the CRTC or government to impose regulations on the algorithms used by online music services, presumably in support of Canadian music:
Imposing obligations on online music services for the development of local products, including algorithms.
The music industry also wants the expansion of the private copying levy, once described as an iPod tax. The resurgence of the private copying levy would presumably be applied to wireless devices, computers, and anything else that plays music. ADISQ, supported in a separate submission by CIMA, call for the restoration of the private copying levy:
la révision de la loi sur le droit d’auteur, incluant la restauration du régime de copie privée et la disparition de certaines exceptions anachroniques visant les radios
The music industry also supports increased regulation of online music services, with ADISQ seeking a Spotify tax. It argues that online music services are the equivalent of radio stations and should be required to make similar contributions.
Bell wants some of the regulations it faces removed or scaled back, but it also foreshadows its forthcoming application for the creation of a radical website blocking system to be overseen by the CRTC. As part of its argument, it implausibly argues that the company has lost out on as many as 350,000 new subscribers to CraveTV, citing downloads of its show LetterKenny (apparently claiming that roughly 1 in 3 downloads would result in a full paying subscription). Bell is joined by Shaw, which devoting several pages to support for website blocking based on court orders.
The Canadian Association of Broadcasters is concerned with the growing use of smartphones and connected devices that may not include access to radio stations. The proposed solution:
The Government and CRTC should also consider ways to ensure radio’s presence on smart phones, connected devices and in cars sold in Canada.
It offers no advice on how to do that (but does warn against restrictions on food and beverage advertising).
ACTRA pins some of its hopes on full-scale Internet regulation complete with licensing ISPs, creating an ISP tax, and prioritizing Canadian content in violation of net neutrality rules. The ACTRA submission states:
Since the Internet is increasingly being used to watch audiovisual programs and ISPs are the gatekeepers of that content, they should be required to contribute to the creation and distribution of Canadian programming content. Accordingly, Internet Service Providers should make a financial contribution to Canadian content programs proportionate to the extent to which consumers are obtaining programming content through their ISP. Internet Service Providers should also provide priority access to Canadian programming.
The ACTRA approach is supported by Friends of Canadian Broadcasting, which wants the CRTC to mandate prioritization of Canadian content on the Internet, including measures such as zero rating, which would presumably require the government to order wireless carriers to eliminate data charges for Cancon.
Topping it off are many, many calls for the elimination of the CRTC’s digital media exemption (which ACTRA calls “one of the most short-sighted decisions in regulatory history” and which would result increased CRTC regulation of online services) and the introduction of Netflix taxes, which the government has consistently said it does not support.
None of this is particularly surprising, but it re-affirms that the Canadian cultural industry views the digital world not for its potential commercial and creative opportunities, but rather for the prospect of new taxation and regulation. Joly may be encouraging the industry to adopt a forward-looking, export oriented approach, but many would prefer protectionist measures, the regulation and taxation of any Internet service, and the creation of preferential treatment requirements for Canadian content in violation of net neutrality rules. All of this was avoidable. However, Joly’s decision to send the culture issue back to the CRTC has now guaranteed months of lobbying on the very issues that the government was supposed to have concluded with an 18-month nationwide consultation and “final” report on which the ink is barely dry.