Cancon redux: Canada’s TV “system” battles the Internet

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“Somebody called me a protectionist this week. I’ve been called far worse, but the term rankled because I had not argued that Canadian television should be protected from foreign competition.”

Kate Taylor, Jan 18: A contemporary argument for Canadian content

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The ball’s in somebody’s court and needs to be lobbed back.

Let’s start with who or what is protectionist. The only such reference I made was to the policy regime we’ve had in Canada since the 1970s:

“Bell and Rogers (plus Shaw and QMI) have made fabulous amounts of money thanks to the vast protectionist apparatus they’ve enjoyed for decades.”

While life may be tougher now, it would be hard to argue that our broadcasters aren’t still benefitting from protectionism: foreign ownership restrictions, simultaneous substitution and restriction of US satellite signals to the approved list are three current examples. Simsub is also a good example of a policy designed to help our TV business rather than TV viewers, who hate it – as in, where are the Super Bowl ads? Continue reading

It’s 2015: Cancon is the aberration, not VPNs or the Internet

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WiTopia is a provider of personal VPN services

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In a Globe and Mail piece last Friday, Kate Taylor starts off by asking the wrong question: Digital content may be cheap, but who will pay to create it? Things go downhill from there.

Ms Taylor’s old-fashioned apology for Cancon, with its predictable sideswipes at “freeriding” Netflix and marauding pirates, is based on ideology rather than evidence. It completely misconstrues the role of security tools like VPNs, at a time when Canadians should be far more concerned about their privacy and security online than about shelf space on the network for domestic TV shows. Most of all, it treats the Internet like a cultural and economic aberration that’s ruining our TV system, when the aberration is Canada’s bizarre and unworkable framework for broadcasting.

Virtual private networks and why you need one

What the article says about VPNs:

“The latest scheme is to use a virtual private network, or VPN, to trick Netflix into believing you are located in the United States and can thus subscribe to the video-streaming service’s American catalogue….

Internet advocates love to preach choice, diversity and freedom – after all, a VPN can also be used by citizens in China to access content censored by their government.”

A VPN is specialized client software that encrypts online messages, and is said metaphorically to “tunnel” through the public Internet. It’s a “virtual” network because there’s no real tunnel or separate physical network. Your data packets are still co-mingling with other people’s packets, but only you and folks with the authentication tools – like a password – can read those packets. The VPN is said to be private for exactly that reason, like an office behind a locked door. Continue reading

The Netflix boogeyman and a 21st-century role for the CRTC

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“Though some intervenors think this proceeding is all about Netflix, it’s not.” –Corie Wright of Netflix

“If the Commission fails to act swiftly after this proceeding, a service such as Netflix will become … one of the largest broadcasters in this country in the near future.” –Pierre Dion, CEO, Quebecor

“Canadian consumers can rest assured that our government will continue to stand up for them. We will not allow any moves to impose new regulations and taxes on Internet video that would create a Netflix and YouTube tax.” –Shelly Glover, Minister of Canadian Heritage

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The thesis: Netflix has handed the CRTC a new lease on life

CRTC ordered Netflix to share its highly sensitive Canadian customer data. Netflix demurred (“stonewalled” by some accounts). The Commission has responded by making Netflix disappear from the history books, expunging its official testimony. Does that mean, as we read recently, that “It’s over, CRTC, Netflix and globalization have won”? Continue reading

Just like cable-TV, broadband is still way too expensive in Canada

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Point Topic releases 2014-Q1 global survey of broadband prices

Research consultancy Point Topic has another set of broadband data to add to the dismal news about Canada. Using USD adjusted by the purchasing power parity formula (PPP), they find that of the 90 countries surveyed, Canada ranks in 58th place on the price for a monthly standalone broadband subscription. We’re just under the global mean of $76.61, one step ahead of Mexico. Continue reading

CRTC demands answers from Bell on its Mobile TV shellgame

mirko-bibic-1Bell’s CRTC whisperer, Mirko Bibic, got bent out of shape when he saw the CRTC’s annoying interrogatories Friday morning

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Today saw another encouraging step in the CRTC’s management of the Ben Klass Part 1 application on Bell’s Mobile TV service. You can get the backstory in my prior posts (first one was in November) and from Ben’s blog, among other places.

That step was the interrogatories sent to Bell officials, asking for detailed information on Bell’s network architecture, subscriber invoicing, content exclusivity and competition, among other things. I’ve pasted in all 10 of the Commission’s questions below. A couple of comments in the meantime…

bell-mobileTVimageFirst off, the language of the questions demonstrates that the Commission is taking Ben’s application to heart, and that it sees a prima facie case against Bell for violating telecom rules. On one crucial point, whether Mobile TV is simply a broadcasting service as Bell claims, the Commission staff want to hear an explanation of the “inconsistency” in Bell’s statements on this matter – as well as of “how a data service that uses the Internet is not a telecommunications service” (yes, Bell argues that its quacking duck ain’t no water fowl no how). Continue reading

Intervening in support of Ben Klass complaint on Bell Mobile TV

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Last Wednesday was the deadline for followup comments on Ben’s Part 1 application, more accurately described as a complaint. In the text below you’ll find the main body of my intervention, minus the top and tail. I wrote about Ben’s original filing back in November: Ben Klass asks CRTC to stop Bell’s deliquency on Mobile TV. As of today, Ben’s current filing hasn’t yet shown up on the Commission’s site: I’ve uploaded it here. Of the other interventions filed this past week, two were especially critical of what Bell is being allowed to get away with. Teresa Murphy starts her comments by suggesting that Bell’s whole argument is founded on a phony distinction (para 2: her pdf is uploaded here):

It makes no sense whatsoever to treat competing services differently when the underlying technology and distribution method is the same. This is allowing vertically integrated companies to behave by one set of rules, and allowing them to treat their competitors differently, and frankly unfairly.

Continue reading

Ben Klass asks CRTC to stop Bell’s deliquency on Mobile TV

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Detail from roof of Brighton train station (rotated) – Aug 2013

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Bell welcomes any competitor, but they should compete on a level playing field.” — George Cope, BCE/Bell Canada, August 2013

“I provide evidence [below] in support of the assertion that Bell gives itself undue preference. It does so by applying an application-specific economic Internet traffic management practice (ITMP) to its Mobile TV service, causing unreasonable disadvantage to competitors and harming consumer choice.” — Ben Klass, CRTC Part 1 Application, November 20, 2013 

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November 25: I’ve added a number of edits and corrections to the running text below. My thanks to Ben Klass, J-F Mezei and Juris Silkans for their helpful suggestions.

Nov.25 – update #2. A formal request has come in already asking the Commission to transform Ben’s application into a full-blown public proceeding that would include a review of ITMPs put in place by both Rogers and Vidéotron, which apparently have the same idea as Bell about what’s meant by a “level” playing field. The request is from PIAC, the Public Interest Advocacy Centre. I’ve uploaded a zipped folder with both PIAC’s letter and Ben’s reply here.

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This post is divided into two main parts (which may not be obvious to the untrained eye). Down to but not including Key elements of Ben’s complaint, you’ll find 3 sections: a) discussion of Ben’s application in general terms; b) an analogy based on the metered taxi cab as a familiar way to illustrate why Bell can’t treat different kinds of traffic differently to give itself a commercial advantage over competitors; and c) a bemoaning of the sad truth that very few people can bring themselves to care about this wonkish stuff, mostly because it’s so freaking hard to understand.

The second half – Key elements of Ben’s complaint – looks at his filing from the perspective of four underlying regulatory concepts. I have a dual purpose here: to clarify some of the muddier aspects of this process; and to talk a little about some of the past history and how we got to this juncture. The four concepts are:

  • a Part 1 Application
  • a new media broadcasting undertaking (NMBU)
  • data (or bit) caps
  • Internet traffic management practices (ITMPs)

These are all mentioned on the first page of Ben’s document. If you don’t know what he means by an “application-specific economic Internet traffic management practice,” you may find a glossary helpful.

Ben Klass is back and this time he means it

ben-klass-nov21-3Last August, Ben grabbed some well-deserved attention with the open letter he addressed to Bell CEO George Cope. In his “I am Canadian” piece, Ben debunked point after absurd point in Cope’s post, which ran on the Bell site under the title “An open letter to all Canadians.” Cope was delivering another salvo in the incumbents’ wacky wireless war against the Harper government and its outrageous idea they should let Verizon enter our market to compete with the Big Three.

For all its merits, Ben’s open letter was an irritant Cope could afford to ignore with impunity (I don’t imagine folks in Bell’s C-suite have been working on their sense of irony since August; and funny how whenever an incumbent CEO insists on a level playing field, you can be darn sure he means exactly the opposite). But that was then, this is now, and Ben has turned up the heat on Bell, way up. Continue reading

Pick-and-pay, Netflix and the CRTC’s TV policy review (1)

7111-mayfair-car-1dCar detailing – Shepherd Market, Mayfair, London W1 – Aug 2013

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tv-flag-4Memo to the CRTC: Even if pick-and-pay were to be implemented, it will never on its own advance consumer welfare by lowering costs or expanding choice, thanks to the market stranglehold enjoyed by Canada’s vertically integrated congomerates (VICs). When Chairman Blais kicks off the so-called “conversation” on TV policy this Thursday (Oct 24), he’ll face a daunting task: having to promise real change in the face of a) legislation that’s two decades out of date (which the Tories are not going to fix); and b) a heavily concentrated industry determined to preserve its bounteous status quo (which the Tories are also never going to fix). The best indicator of a meaningful review won’t be whether TV subscribers can simply pick and pay from among Canadian services at BDU prices not disciplined by either competition or regulation.

The real barometer of any new TV policy and its success or failure will be whether subscribers can choose services freely from outside the regulated broadcasting system – especially non-Canadian services delivered online, like Netflix, and do so without being subject to anti-consumer punishments like price-gouging through data caps. Netflix is a good marker to watch because it has conquered the OTT space and continues to grow in popularity; and because if the big broadcasting groups see any threat from a new policy framework, the first words out of their mouths will be, tax Netflix! If the CRTC continues to allow the VICs to brandish undue preference in our vertically-integrated media universe, then we’ll know the TV policy review has been a failure.

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ballon_fire-1Trial balloons and red herrings

So the Harper government wants to help consumers. As the Speech from the Throne indicated, that help would allegedly embrace TV subscribers, who might some day be allowed to select which television channels they want to pay for, rather than being forced to pay for bundles. As Greg O’Brien at Cartt.ca pointed out, the timing is a little weird: “Who’d a thunk the first submission to the CRTC’s television policy review would come straight from the federal government.” Continue reading