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Stories filed under: "crtc"

Canada Imposes 5% Tax On Streaming To Fund Local News, Diverse Content

from the get-ready-to-pay-more dept

Canadian Regulators are leaning on new authority built into the 2023 Online Streaming Act to impose a new 5 percent tax on streaming TV and music services like Netflix and Spotify; funding that the regulator says will then be used to help fund Canadian broadcasting.

According to the Canadian Radio-television and Telecommunications Commission (CRTC) announcement, the plan should drive $200 million in new funding annually to local news and a variety of other public interest content:

“The funding will be directed to areas of immediate need in the Canadian broadcasting system, such as local news on radio and television, French-language content, Indigenous content, and content created by and for equity-deserving communities, official language minority communities, and Canadians of diverse backgrounds.”

The fee systems effectively mirrors the fees already imposed on local broadcasters. Past efforts on this front (in the U.S. and Canada) haven’t been received particularly well by streaming giants, and the same applied here. The Digital Media Association, which represents Amazon Music, Apple Music and Spotify, insisted in a statement that the new tax will only expand what they’re calling an “affordability crisis”:

“As Canada’s affordability crisis remains a significant challenge, the government needs to avoid adding to this burden. This is especially true for younger Canadians who are the predominant users of audio streaming services.”

Huge contracts for the likes of Joe Rogan and Wall Street’s insatiable demand for relentless quarterly growth have more to do with streaming affordability than anything else, though in this case the services are correct in that they’ll simply pass the cost of the new taxes directly on to users. Facing slowing subscriber growth, streaming giants have already been pretty relentlessly raising rates.

That said, real journalism (especially independent and minority owned) is consistently facing a funding crisis, and much of the conversation (both in the U.S. and Canada) tends to be centered around what isn’t possible, shouldn’t be done (usually framed around the interests of giant corporations), as opposed to actually fixing the problem.

At the same time, similar efforts are often derailed by corruption, and there’s no guarantee the money guaranteed for useful things actually finds the way it its original destination.

Efforts to tax streaming companies to help fund broadband deployment in the States, for example, risk being hijacked by telecom giants looking to exploit corrupt policymakers simply to pad their wallets. Municipalities in Texas have also tried to tax Netflix with a fairly broad disdain for existing law and no particular public interest initiative in mind.

Filed Under: canada, crtc, journalism, streaming, tax, video

from the shifting-stories dept

Update: The Minister has now attempted to backtrack these latest comments and repeated his insistence that the bill will not apply to social media users, though the impact the regulatory powers — which he says will apply to the platforms — will have on users remains unclear.

Throughout the Canadian government’s legislative push to give broadcast regulators power over online services, the story on exactly what the bill would do has continually shifted, and its author, Heritage Minister Steven Guilbeault, has been consistently vague and evasive in the face of questioning from other lawmakers and the media. He has repeatedly insisted that Bill C-10 is designed to target large audio and video services that act like broadcasters, but will not impact individual users of sites like YouTube and Twitch — despite the fact that the clause which would have clearly prevented this was removed and a new amendment confirms that social media will be subject to at least some regulation.

The latest development is another change in the story: in a recent interview, Guilbeault stated that the new regulatory powers can apply to YouTube channels:

“What we want to do, this law should apply to people who are broadcasters, or act like broadcasters. So if you have a YouTube channel with millions of viewers, and you’re deriving revenues from that, then at some point the CRTC will be asked to put a threshold. But we’re talking about broadcasters here, we’re not talking about everyday citizens posting stuff on their YouTube channel,” Guilbeault said.

One of the main points critics of the bill have been making is that, despite Guilbeault’s insistence that it won’t impact individual users, he’s never been able to explain why not given the powers the bill gives to the broadcast regulators at the CRTC. This latest comment just confirms it: whatever the stated intent, the bill leaves it up to the CRTC to decide if and when to extend their new regulatory powers to a user of a platform like YouTube. He frames this as not impacting “everyday citizens” but, of course, many everyday citizens on social media can get huge audiences on par with major broadcasting operations — that’s kind of the whole point, and one of the reasons people are rightfully opposed to the government regulating people’s speech on those platforms. And of course, as always, the bill doesn’t offer any clear, solid protections against overreach — nor does Guilbeault:

Asked repeatedly what the threshold would be for CRTC scrutiny, whether a certain number of millions of followers, or a certain amount of advertising revenue, the minister said it?s something the government will ask the CRTC to determine, but that it would be entities that have a “material impact on the Canadian economy.”

This vague and almost meaningless condition isn’t very reassuring, especially coming from the same person who recently insisted that the bill wouldn’t impact users of these platforms at all.

Opposition to the bill is rightfully growing throughout Canada and across party lines, and there’s a growing amount of speculation about the legal challenges that C-10 is likely to face if passed. If the government really wants to achieve its primary stated goal of getting major audio and video services like Netflix and Spotify to support Canadian content the way traditional broadcasters are required to (a proposal that still raises significant questions that will need to be examined), they’re first going to need to unveil a completely revamped bill that actually addresses people’s very real concerns and places clear limitations on the CRTC’s power to ensure that it won’t curtail Canadians’ freedom of speech, and stop trying to feed the country a vague and shifting story interspersed with desperate promises that the bill won’t do what everyone can see it will.

Filed Under: c-10, canada, content, crtc, regulations, steven guilbeault, streaming, videos
Companies: youtube

from the not-gonna-work dept

It’s Canada’s turn in the carousel of attempts at terrible internet regulation around the world. The ruling Liberal party, which professor and internet law researcher Michael Geist has called the most anti-internet government in Canadian history for its wide variety of planned new internet laws, has been working for months on a bill to amend the Broadcasting Act and greatly broaden its scope, giving the CRTC (Canada’s counterpart to the FCC) authority over all kinds of online video and audio.

Canada has a long history of requiring broadcasters to support and air Canadian content, setting percentages of airtime that must be dedicated to it. While this is controversial and of questionable efficacy, it is at least coherent with regards to television and radio broadcasting over public airwaves — but Bill C-10 would bring streaming services and many other websites under the same regulatory regime, which also includes even more concerning powers to regulate political speech. Supposedly, this is targeting services like Netflix and Spotify — which already raises some serious questions as to how such regulation would work — while the bill’s champion, Heritage Minister Steven Guilbeault, has repeatedly insisted that it will not cover social media and user generated content. The clause excluding such content was already worryingly narrow, and now the government has removed it anyway. And yet Guilbeault continues to insist user generated content has nothing to worry about, even though there are multiple reasons this is clearly untrue — not least of which is a new “exception that proves the rule” amendment setting the contours of UGC regulation, to be considered soon:

The amendment is a clear acknowledgement that user generated content are programs subject to CRTC?s regulation making power. Liberal MPs may claim the bill doesn?t do this, but their colleagues are busy submitting amendments to address the reality.

But it is not just that the government knew that its changes would result in regulating user generated content. The forthcoming secret amendment only covers one of many regulations that the CRTC may impose. The specific regulation ? Section 10(1)(c) of the Broadcasting Act ? gives the CRTC the power to establish regulations ?respecting standards of programs and the allocation of broadcasting time for the purpose of giving effect to the broadcasting policy set out in subsection 3(1).? While the government plans to remove that regulation from the scope of user generated content regulations, consider all the other regulations it intends to keep and impose on millions of Canadians. Regulations that are not found in the amendment and therefore applicable to user generated content include regulations:

(a) respecting the proportion of time that shall be devoted to the broadcasting of Canadian programs;?
(b) prescribing what constitutes a Canadian program for the purposes of this Act;
(e) respecting the proportion of time that may be devoted to the broadcasting of programs, including advertisements or announcements, of a partisan political character and the assignment of that time on an equitable basis to political parties and candidates;?

Each of these speak to potential new regulation on the free speech of Canadians. Most notable may be political speech, which gives the CRTC the power to order equal time for partisan political speech. While this was designed for broadcast networks, the legislation would now cover all programs, including user generated content.

Correction: The way the bill is worded, online services are apparently not covered by the “political balance” regulatory powers.

It’s a stunning, virtually unprecedented attack on the free speech of Canadians. Among the bill’s biggest problems is the fact that many of these powers are extremely vague and administered at the discretion of the unpredictable CRTC — which is also part of what allows the politicians behind it to equivocate and deny when pressed on what exactly it will do. It has been called “one of the most radical expansions of state regulation in Canadian history” by those journalists who have noticed just how far-reaching it might be:

While the government claims it would not empower the CRTC to regulate smaller services such as Britbox, social media sites such as YouTube, or online news content, the bill contains no specific provisions that would prohibit it ? and includes provisions that seem to allow it. For example, while the bill exempts ?programs that are uploaded to an online undertaking? by its users and ?online undertakings whose broadcasting consists only of such programs,? it leaves the way open for the CRTC to regulate services that show both user-generated and curated content. Like YouTube.

Likewise, lots of streaming services offer news content alongside movies and other fare. And lots of text-based news organizations, such as The Globe and Mail, also stream audio and video. So a specific exemption for audiovisual news content would not be greatly reassuring, even if the bill contained one ? which it doesn?t.

Luckily, the bill is getting much more attention following the latest changes. Unluckily, it’s at risk of becoming mired in the broader partisan fights of Canada’s parliament — even though this is a case of something that everyone, from every party (not least the Liberals pushing it) should oppose. I don’t have to explain why applying such regulations, especially about political “balance”, to social media would be a disaster for free speech, especially now with the pandemic keeping people trapped at home and spawning multiple political crises across the country. It’s not at all clear how the CRTC would use these powers, but there’s little reason to believe they’d use them wisely (as if such a thing is even possible), and the uncertainty alone could cause user generated content platforms to clamp down on what Canadians can share.

Plus, it’s especially concerning the way the government has repeatedly misled the public about what the bill will do, often contradicting itself and leaving the text full of loopholes that means it might apply to all kinds of unexpected things like app stores. Canadians from every part of the political spectrum must recognize Bill C-10 as the astonishing attack on free expression that it is, and force the government to reject it — or else the internet in Canada is going to get a whole lot smaller and less open.

Filed Under: audio, c-10, canada, content moderation, crtc, internet, internet freedom, regulations, social media, steven guilbeault, streaming, video

Canada Appoints Lobbyist To Top Telecom Regulator, Follows US Down The Regulatory Capture Rabbit Hole

from the whiplash-from-the-revolving-door dept

Mon, Jul 31st 2017 03:34pm - Karl Bode

The last few years have seen a boon in consumer and small-business-friendly policies coming out of Canada’s telecom regulator the CRTC. Under outgoing agency head Jean-Pierre Blais, the agency bumped the definition of broadband to 50 Mbps, required that phones must now be sold unlocked in Canada, shored up the country’s net neutrality rules, and took aim at the anti-competitive use of usage caps and overage fees. Not everything Blais did was a success (like their attempt to force cable TV providers to offer cheaper plans, then failing to follow through) but by and large the CRTC has been an improvement over years past.

But Canadian consumers are worried that’s coming to an end with Justin Trudeau’s decision to appoint telecom executive and lobbyist Ian Scott to head the agency. Scott has spent years working at and lobbying for several Canadian telecom incumbents, his velocity through the regulatory revolving door at several times leading to complaints over conflicts of interest.

Scott’s appointment have many Canadian consumer advocates worried that after several years of aiding consumers, Canada is eager to follow their neighbors to the south down the regulatory capture rabbit hole:

“This is a concerning choice by the government,? said OpenMedia communications manager Meghan Sali, who also noted that, under Blais, the regulator declared broadband Internet a basic service in Canada.

?Canadians were hoping for somebody with a strong consumer rights background, and will undoubtedly be disheartened to see the Trudeau government place someone from industry into the top decision-making position.”

Much like former US FCC boss Tom Wheeler, Blais’ attempts to actually stand up for consumers raised hackles at Canadian incumbents. At one point, Canadian incumbent Bell actually refused to let Blais appear on their television channels in retribution for his efforts to make Canadian cable television more affordable. Similarly, much like here in the States, incumbent ISPs often tried to characterize Blais’ slightly-more consumer-friendly policies as radical and fatal to industry investment and innovation. Needless to say, they’re arguably thrilled by this new appointment of a direct ally.

Of course the fact that Scott has spent the better part of the last few decades employed by incumbent Canadian ISPs doesn’t automatically mean he’ll be a sycophant to industry. Many are quick to highlight how nobody thought much of former U.S. FCC boss Tom Wheeler initially, his history of lobbying for the cable and wireless industries having raised plenty of eyebrows after his initial appointment. And because Wheeler went from dingo to what most see as the most-consumer friendly FCC boss potentially in agency history, he’s now consistently used to downplay the historical threat posed by revolving door regulators.

Except Wheeler was a lobbyist for the cable and wireless industries during their nascent years, when both were pesky upstarts actually interested in competition and disruption. Wheeler also historically showed an uncommon ability to actually change his positions based on facts, an attribute in increasingly rare supply. So while it’s certainly possible Canada’s new CRTC boss could “pull a Wheeler” and somehow magically become a consumer ally, history generally suggests that Tom Wheeler was the exception, not the rule. Still, maybe Canadians will get lucky and Canada won’t revert to a more industry-cozy approach to telecom and media policy.

Filed Under: canada, crtc, ian scott, jean-pierre blais, justin trudeau, lobbyists, net neutrality, regulatory capture, telecom

Canada's Attempt To Force Cheaper, More Flexible Cable Packages Is A Bit Of A Joke

from the the-illusion-of-choice dept

Fri, Dec 2nd 2016 02:42pm - Karl Bode

Canada’s attempt to force Canadian cable providers to deliver cheaper, more flexible cable TV bundles appears to be a comedy of errors. Last year, driven by user complaints, the CRTC passed rules requiring Canadian cable companies to provide a $25 so-called “skinny bundle” of discounted TV channels starting March 1 of this year, and the option to buy channels individually (a la carte) starting December 1 (aka this week). Companies responded by first pouting, then by offering new “discounted” TV bundles so layered with hidden fees, surcharges, and caveats as to be effectively useless.

This week’s deadline to offer a la carte TV channels doesn’t appear to be going much better. Companies like Rogers, Shaw, and Bell are now allowing users the option to buy TV channels individually — but they’ve again priced each channel high enough to make the option completely pointless. Under this new pricing paradigm, buying individual channels can cost you anything from 6to6 to 6to20 per channel. After having a little time to crunch the numbers, consumers were quick to complain to the BBC about the absurdity of the entire effort:

“Turns out, to add CNN and CP24 individually, Spitz would pay 14amonthinsteadof14 a month instead of 14amonthinsteadof15. That’s only a $1 savings, and her mother would lose a handful of extra channels included in the theme packs.

“That’s ludicrous; that’s ridiculous,” said Spitz.

But some industry experts are not surprised by the pick and pay prices. That’s because, they say, TV providers are for-profit companies, and their main objective is to protect the bottom line.

“What did you really expect?” says telecom expert Gerry Wall.

Incumbent Canadian TV providers, as you also might expect, insist that offering “discounted” service that really doesn’t provide any discount is the height of value, and that the way they’ve always done things (read: offering you a bloated, expensive bundle of channels you don’t actually watch) is the best way to continue to do things:

“Rogers told CBC News that adding individual channels to a plan won’t benefit everyone and that most customers instead opt for its bigger TV packages “which offer great value.” It said the cable company’s standalone channel pricing is “reasonable and competitive.”

Part of the problem is that the CRTC doesn’t really have the authority or willingness to fully regulate rates, so it’s demanding less expensive options for consumers — but isn’t really willing (or in some instances able) to hold companies accountable when they tap dance around the requirements. In a March interview with The Globe and Mail, CRTC boss Jean-Pierre Blais tried to downplay public criticism of the effort (and the CRTC’s unwillingness to follow through) by claiming the goal was never to lower soaring cable bills:

“People may have thought, mistakenly, that the CRTC was going to reduce everybody?s cable bills ? that?s not what we promised. We said we?re going to give you more choice,? Jean-Pierre Blais, chairman of the Canadian Radio-television and Telecommunications Commission, said in an interview.”

But what people actually got was the illusion of more choice under what appears to just be regulation theater. Given the fact that streaming video competition (and by proxy lower prices and more choices) will be arriving whether these cable companies like it or not, the CRTC’s effort could just be a giant waste of time. A better tack for regulators would be to focus not on trying to drag legacy TV kicking and screaming into the modern era, but to focus on improving broadband competition and obstacles (usage caps) to the rise of cheaper, better, and more flexible streaming TV alternatives.

Filed Under: a la carte, canada, crtc, tv

Canadian Government Fails To Force Cheaper TV Options, Blames Consumers For Not Trying Harder

from the much-more-of-the-same dept

Wed, Apr 6th 2016 03:32pm - Karl Bode

Last month we noted how Canadian regulator the CRTC tried to do something about the high cost of TV service by forcing Canadian cable operators to provide cheaper, more flexible TV bundles. Under the new CRTC rules, companies had to provide a $25 so-called “skinny bundle” of discounted TV channels starting March 1, and the option to buy channels a la carte starting December 1.

The Canadian TV industry responded, but not in the way government (should have) expected. Some companies responded by pouting and refusing to show regulators faces on TV. Some cable operators tried to hide the options from consumers. Others offered so-called “skinny bundles,” but saddled them with so many below the line fees as to make the product offerings lack any real value. Some cable operators even agreed to adhere to the December 1 a la carte requirement a little early by offering consumers individual channels for sale — but pricing them at $18 each.

In other words the CRTC’s attempt to lower industry prices isn’t really working, in part because the CRTC (much like the FCC in the states) refuses to crack down on misleading, below the line fees and false advertising. In a bit of an odd interview with the Globe and Mail, CRTC boss Jean-Pierre Blais now seems to claim that the CRTC’s efforts can’t be a bust, because the goal was never to lower TV prices:

“People may have thought, mistakenly, that the CRTC was going to reduce everybody?s cable bills ? that?s not what we promised. We said we?re going to give you more choice,? Jean-Pierre Blais, chairman of the Canadian Radio-television and Telecommunications Commission, said in an interview.”

Right, but the reality is that the CRTC’s plan (so far) has fostered neither choice nor lower prices, it has simply fostered the illusion of choice. Users may now be able to get a $25 discounted bundle of TV channels, but once you add on set top rental fees, DVR fees, home gateway rental fees, HD fees, “digital service fees,” fees for additional channel packs you actually want to watch, and the cost of mandatory broadband — you’re not really seeing much if any significant improvement. The CRTC’s effort might work, but it would require cracking down on misleading pricing, which no telecom regulator in North America seems all that keen on.

Oddly, Blais then proceeds to effectively imply consumers (which are calling in at volume to complain about the misleading offers) are to blame for not working hard enough to secure a good deal:

“He said the commission?s aim has been to give consumers ?tools to solve their own problems,? and used a personal anecdote to drive home his point. ?I myself ? looked at my offerings and slimmed it down,? Mr. Blais said, after giving a speech about anti-spam legislation in Toronto on Tuesday. ?Was it easy? No. ? You have to keep going up the chain into [the] loyalty program. It requires effort…This will take time and I?ll repeat it again: Canadians will have to do some work,? Mr. Blais said. ?They will have to be ready to at least threaten to change providers.”

Again though, the end result, even with a lot of consumer work, really is more of the same. Users now get to enjoy the illusion of choice and value, instead of actual choice and value. Which leaves one again wondering if instead of trying to regulate cable prices (and even cable boxes as we’re trying here in the States) it would make more sense to just let the legacy pay TV system collapse under the weight of its own hubris and Internet video competition, then focus the full power of regulatory attention on doing everything possible to promote broadband competition, the real regulatory battlefield of the 21st century.

Filed Under: cable, canada, crtc, television

Canadian Cablecos Dodge Government Demand For Cheaper TV Bundles — By Hiding Them From Consumers

from the compliance-tap-dance dept

Thu, Mar 3rd 2016 09:23am - Karl Bode

This week, the Canadian government will begin forcing Canadian cable operators to provide cheaper, more flexible cable TV packages. Under the new CRTC rules, companies must provide a so-called “skinny bundle” of discounted TV channels starting March 1, and the option to buy channels a la carte starting December 1. But while the CRTC’s attempt to force innovation on the cable industry may be well-intentioned, it’s already clear that Canadian cable operators plan to do everything in their power to tap dance around the requirements.

One of the tricks, apparently, involves companies like Rogers and Bell simply refusing to seriously advertise the new options to consumers. A Bell training document leaked to the CBC clearly tells employees that they shouldn’t even bring up the option unless the customer asks:

“The Bell training document states: “Do not promote the Starter TV package. There will be no advertising, and this package should only be discussed if the customer initiates the conversation.”

In addition to refusing to advertise the new options, Bell and Rogers employees tell the news outlet that the packages are saddled with a large number of below-the-line fees, so that what appears to be a bargain is anything but once Canadian consumers actually get their bills:

“The Bell document also shows that add-ons to the basic “Starter” pack can become so costly that what was supposed to be a good deal for Canadians could wind up, in some cases, costing more than their current cable bill…”They’re making the skinny basic package simply unbuyable,” he said. “What’s been explained to me is that maybe one per cent of people would be interested in getting it.”

So whereas the new option may be advertised (barely) as a discounted tier, once you saddle the tier with restrictions, fees, hardware rental charges and other below-the-line surcharges, consumers won’t be getting much of a deal. And, unless the CRTC is willing to police each and every bill and force total pricing transparency on misleading fees (which neither the FCC nor CRTC have much of a history with), the entire effort risks being for naught.

The other problem is that even if cable operators are forced to offer better, cheaper, TV options, they’ll just turn around and recoup any lost revenue on the broadband side of the equation. In Canada, that historically has involved hitting uncompetitive broadband markets with usage caps and overage fees — just like Comcast’s efforts here in the States. Given the TV sector is ripe for disruption from Internet video either way, it may make more sense for regulators to focus their attention solely on boosting broadband competition, letting traditional, expensive television continue its slow but steady death spiral.

Filed Under: a la carte tv, canada, crtc, transparency, tv bundles
Companies: bell, rogers communications

Canada Forcing Cheaper, More Flexible Pricing On TV Industry March 1. Will It Work?

from the innovation-at-gunpoint dept

Wed, Feb 24th 2016 03:22am - Karl Bode

Starting next week, Canadian cable providers will be forced by the government to do something inherently and violently foreign to them: offer cheaper, more flexible cable bundles. In March of last year, Canadian regulator CRTC announced it would be combating high TV prices by forcing cable operators to offer cable channels a la carte, or so-called “skinny bundles” of cheaper cable channels, by December 2016. The CRTC’s full ruling declared that by March 2016, all Canadian TV providers must at least provide a $25, discounted skinny bundle, letting users pick and choose individual channels beyond that.

Not too surprisingly, most cable operators in Canada haven’t been particularly eager to reveal what these plans will look like, lest they give them any more media attention than absolutely necessary. The CRTC sent out a memo last week reminding companies of the deadline, and agency boss Jean-Pierre Blais warned the cable industry to avoid getting too clever in terms of the upcoming packages:

“Cable and satellite companies should not view this change as an opportunity to replace business practices designed to maximize profits from captive customers with newer forms of anti-consumer behaviour,” he said in a speech to the Canadian Club of Toronto on Thursday. “Instead, I urge them to make the products they sell even better for Canadians.”

Needless to say, Canadian cable operators didn’t respond well to the CRTC’s demands, with one Bell exec even going so far as to refuse to show Blais’ face on TV after the ruling. And while only one major cable provider has detailed their skinny bundle plans, new tricks may still be an uphill climb for old dogs. Shaw’s new Limited TV skinny bundle provides 40 cable channels (more than a few of which are junk) for 25amonth.Ofcourse,ifviewerswantHDthey’llneedtopay25 a month. Of course, if viewers want HD they’ll need to pay 25amonth.Ofcourse,ifviewerswantHDthey’llneedtopay5 per month for an HD box. If you want a DVR (which most people do), you need to pay $15 a month.

Theme packs to get the channels users actually want are another $6 per month. And this is all before you tack on the inevitable below-the-line “insert completely made up justification here” fees, which means that once the bill actually comes — users won’t be seeing much of anything resembling a real value. Perhaps Canada’s foray into forced a la carte will provide something more (r)evolutionary later in the year.

Whether you can actually force the cable industry to evolve on pricing has been hotly debated. Here in the States, our brief obsession with forcing cable operators to offer a la carte channels (spearheaded at times by John McCain) ultimately died after industry claims that such a forced model would destroy niche programming and raise consumer rates became crowd wisdom. Of course prices have gone up regardless, and cable providers themselves have actually started pushing niche channels (and even less relevant content like The Weather Channel) off their networks to save money for sports programming.

And while US providers are also exploring skinny bundles to fend off cord cutting, like the Canadian implementation, these offerings tend to quickly lose value thanks to buried fees.

Regulators are then put in the position of needing to address misleading fees as a form of false advertising, something neither the FCC nor CRTC have been willing to do. And as TV providers lose income on the television side, their first instinct is to look to recoup those losses elsewhere — generally in the form of broadband usage caps and overage fees. So, as with the FCC’s new set top box push to Canada’s south, it’s relatively easy to be left wondering if regulators should be focused on the future (broadband) instead of the past (legacy television).

So the fundamental question remains: do you wait for Internet video to disrupt and dismantle the TV industry naturally, or do regulators try to force the issue with rules mandating lower prices and more flexibility? Whether you support the idea or not, Canada’s about to show us if the latter is worth the time and effort.

Filed Under: a la carte, canada, crtc, pricing, tv

Videotron Tests Neutrality In Canada: Biggest Music Apps Now Cap Exempt

from the bad-ideas-dressed-up-as-good-ideas dept

Fri, Sep 4th 2015 02:05pm - Karl Bode

Canadian cable and wireless operator Videotron is hoping to see just how far Canada’s net neutrality rules will stretch. The company last week was the latest to experiment with a new zero rated usage plan that exempts the biggest music services from the company’s usage caps. Dubbed “Unlimited Music,” Videotron’s new effort will initially exempt services like Stingray, Rdio, Google Play, Deezer and Spotify from usage limits. Depending on popularity, additional services will be placed on the company’s usage-allotment whitelist in the coming months. According to Videotron, this is about “getting ahead” of consumers’ needs:

“We want to get ahead of our customers? needs once again by bringing them a unique, innovative service: Unlimited Music will help make the connection between fans of music from Qu?bec and around the world, and the major music streaming players.”

On the surface most users initially like the idea of cap-exempt content. Indeed, carriers have tried to frame such a concept as “1-800” or “free shipping” for data, where the content company bears the brunt of the cost of delivering the content to the end user. Consumers pay less for data and select companies gain a marketing advantage. It’s a huge win for everybody involved, right?

Well, no. Remember that usage caps imposed by carriers are utterly arbitrary and are barely bound to any real-world economics or engineering. These are artificial limitations carriers then charge consumers and companies to navigate. By letting the biggest companies be exempt from these arbitrary limitations (sometimes for pay, sometimes not), you’ve immediately put small businesses, independents, and non-profits at a massive disadvantage. This has been a huge issue overseas where Facebook and Google have faced fierce opposition to their dreams of turning the Internet into a zero rated, selectively curated, walled-garden advertising kingdom.

Back in the States, VC Fred Wilson put it this way a few years back:

“The pernicious thing about zero rating is that it is marketed as a consumer friendly offering by the mobile carrier ? ?we are not charging you for data when you are on Spotify.” But what all of this zero rating activity is setting up is a mobile internet that looks a lot more like cable TV than our wide open Internet. Soon a startup will have to negotiate a zero rating plan before launching because mobile app customers will be trained to only use apps that are zero rated on their network.”

For some reason, many people can’t see the threat posed by zero rating. Stop by any Reddit thread on the subject, and you’ll usually find most users utterly clueless to the potential pitfalls of letting carriers inject themselves as middle men in this fashion (free Spotify, bro!). Even T-Mobile, currently the US wireless industry consumer darling (whose “Music Freedom” idea Videotron is copying), doesn’t understand the pitfalls of zero rating. Regulators too have gone out of their way to avoid seriously addressing zero rating, meaning that companies can dance over and under net neutrality rules, just as long as they’re clever about marketing the violations as a boon to consumers.

In Canada, zero rating is supposed to be a subject the CRTC examines on a case-by-case basis. But when the CRTC can be bothered to enforce neutrality, they’ve only taken action against the most obvious offenses (like phone companies exempting their own video services from their caps, but not competing companies’ traffic). Though they’ll fumble in admitting as much, North American regulators see caps and zero rating as “creative” pricing experimentation.

With regulators napping and many consumers cheerfully and obliviously rooting against their own best self interests, it’s pretty clear we intend to collectively discover just how stupid and slippery the zero rating slope can be. Perhaps real-world experience will be educational in a way that warnings about zero rating couldn’t be. But it’s kind of like the boiling frog anecdote; once you’re fully aware of the temperature of the water, you’ve already traveled beyond the point of no return. Once we’ve accepted the carrier meddling and unlevel playing fields inherent in zero rating, it may be too late to backtrack.

Filed Under: broadband caps, canada, crtc, net neutrality, zero rating
Companies: videotron

Canada Is Still Doing A Half-Assed Job Enforcing Its Net Neutrality Rules, Highlighting Importance of Competition

from the doing-as-little-as-possible dept

Thu, Aug 13th 2015 10:16am - Karl Bode

Back in 2009 when it looked like real net neutrality in the U.S. was all but dead, Canada implemented the country’s first net neutrality rules. The rules were particularly necessary thanks to a laundry list of particularly ham-fisted neutrality abuses by Canadian ISPs, ranging from Telus blocking subscriber access to union blogs in 2005, to Rogers throttling access to all BitTorrent traffic (thereby crippling World of Warcraft) in 2011. Canadian ISPs have been legendary for implementing all manner of usage caps, overages, and other neutrality-eroding “creative” efforts, which the rules aimed to address.

The problem? The government agency in charge of enforcing the country’s net neutrality rules apparently can’t be bothered to actually do so.

As we noted back in 2011, the CRTC doesn’t appear to be following through on complaints, simply flagging them as “resolved” if the ISP in question just insists it’s “working on it.” Fast forward to 2015 and Canadian Law Professor Michael Geist again notes that the CRTC still isn’t doing a very good job actually holding ISPs accountable for violations. Even when a complaint very clearly violates the rules, it’s the consumer that has to jump through hoops. And often, the CRTC can’t be bothered to investigate:

“In March 2010, a complaint was filed against Cogeco, a cable provider with a traffic shaping policy that continuously limited bandwidth for peer-to-peer applications on a 24/7 basis. Given the CRTC?s requirement that traffic management limits be linked to actual network congestion, the Cogeco policy raised red flags. Even so, the CRTC demanded that the complainant provide more evidence before it would investigate.

In a December 2009 complaint against Bell over throttling access to the MediaMonkey.com website, the CRTC dismissed the complaint on the grounds the site did not appear in Bell?s list of affected sites.

Yet even when the CRTC pursues a complaint, there is little actual investigation. Most activity is limited to exchanging correspondence or prodding Internet providers to respond. This typically leads to revised disclosures, rather than real changes.”

To be clear, net neutrality is hard to enforce. And regulatory agencies can be beset by false complaints from consumers that think every hiccup on their line is a violation. But as Geist notes, even in instances where there are clear violations of the rules, the agency can’t be bothered to do any work. And they’re doing even less about things like interconnection issues, aggressive usage caps and overages, or connections that don’t live up to advertised promises.

That’s why, as we noted the last time this came up, it’s important to remember that net neutrality rules are only a backup idea to the real solution: more broadband competition. Carriers don’t engage in this kind of behavior if customers can vote with their wallet. Fortunately the CRTC did push things in this direction recently when they opened up incumbent fiber networks to competition. Still, actually doing its job and enforcing its own rules might be a good idea.

Filed Under: canada, competition, crtc, net neutrality, regulation