The CRTC was long perceived by many Canadians as a captured regulator, largely inaccessible to the public as it dispensed decisions that safeguarded incumbents from disruptive competition. That reputation was buttressed by initial decisions on regulating Internet telephony, permitting Bell to engage in Internet throttling, and supporting a usage based billing approach that hampered competition. In recent years, some policies changed with the adoption of net neutrality regulations and the efforts of former chair Jean-Pierre Blais to prioritize consumer interests. Yet over the past few months, the CRTC under new chair Ian Scott seems determined to turn back the clock with a commission more comfortable with industry stakeholders and their priorities than consumer groups and facilitating competition.
Last week, I wrote about this trend with respect to lost transparency and privileged access for the industry. My post argued that public trust in the CRTC “is in danger of being frittered away as stakeholders fear a return of privileged access for industry that leaves the public interest stranded far from the centre of the Canadian communications system.” That post focused on the significant increase in lobbyist meetings, the presentation of the FairPlay site blocking proposal to commission staff months before it was available to the public, and meetings with the NFL while the issue of simultaneous substitution of the Super Bowl broadcast was before the commission.
The concerns about changing rules of access are matched by the equally troubling trend of CRTC decisions in which the consumer perspective is practically nowhere to be found. In just a matter of months, the CRTC has rejected policies that might foster greater wireless competition, dismissed calls for an inquiry into questionable telecom sales practices, and placed limits on cost awards for public interest organizations. The combined effect of those decisions points to a commission seeking to restore an old-style regulatory environment with less disruption both in the market and at hearings in Gatineau.
Last week’s CRTC report on “harnessing change” of programming distribution represents an even more dramatic return to the pre-digital days of old. While the report may be “digital-first”, its thinking is distinctly pre-Internet. In the commission’s view, the Internet is barely distinguishable from cable television and should be regulated and taxed as such. Despite ample evidence to the contrary – the CRTC’s own data says that 75% of wireless Internet access is not audio or video – it claims that Internet access is “almost wholly driven by demand for audio and video content.”
With that starting point, it is no surprise that it envisions regulating any audio or visual service that touches Canada and taxing all Internet services as if they were cable or satellite. In fact, the CRTC sets the stage for an unprecedented level of intervention, bringing digital news organizations, podcasters, and streaming audio services wherever located into its regulatory ambit. Moreover, it opens the door to Canadian households paying additional fees for all of their broadband and wireless subscriptions.
Rather than adopting a forward-looking approach, this proposed framework has the feel of something out of the 1980s, in which the interests of consumers are barely addressed, the production of Canadian content is assessed primarily through the prism of regulated support mechanisms, and the CRTC views its regulatory power as virtually limitless.
What might this new (or old) commission foreshadow for several outstanding policy issues?
The future of the Super Bowl simultaneous substitution decision is surely in doubt. The weak response from the major wireless companies on affordability might still be enough for a commission that is untroubled with increasing wireless costs for consumers. The FairPlay site blocking proposal, which should be dismissed on jurisdictional grounds alone, gets new life from a commission that thinks it can “harness change”. And though net neutrality is now firmly entrenched as government policy, as new issues emerge the CRTC may be less receptive to extending or fully enforcing the principle.
In short, this is the 1980s pre-Internet CRTC with a pro-consumer approach seemingly a thing of the past.