The role of technology and policy in transforming online culture – chronicled by David Ellis
TV
Get yer grimy paws off my Netflix: Ottawa’s big OTT scam
235 days
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Canada’s (“frightened,” “alarmed”) media gatekeepers go on a rampage, led by the regulator
So… the CRTC holds sub rosa meetings in March with a roomful of interested parties about the growing “threat” of over-the-top (OTT) Web content. The same 
week, the Commons Standing Committee on Canadian Heritage issues its report on “…The Move Towards New Viewing Platforms,” a compendium of witness statements all arguing new viewing platforms are a threat to Canadians. Shaw e.g. warns (p.5) that “by consuming valuable capacity, over-the-top providers threaten to undermine our significant network investments and impact the quality of service offered to our ISP customers. Finally, consumers will ultimately suffer, with fewer Canadian choices.”
Many of the patriots who showed up for the Standing Committee hearings then become members of the OTT Working Group, alleged to comprise some 35 “industry executives” – we don’t know for sure since their activities and membership are secret, even though they are operating with the sanction of the regulator. They subsequently change their name to the Online Broadcasting Working Group (OBWG) – and with a stroke of the pen ensure that no one will construe OTT content for anything but broadcasting (what they call begging the question, i.e. assuming what is to be proved).
On May 25, the CRTC “responds to Netflix critics” (Wire Report headline) by issuing a notice of consultation – structured not as a formal “proceeding” but a “fact-finding mission” – a nuance with important implications, especially for Ottawa’s tiny consumer advocacy community. Now that the Netflix critics have got their official “fact-finding” exercise, the OBWG does us all a favor on June 6 by revealing who the group’s members are. (more…)
The Cancon Cabal: Rescuing Consumers from the Scourge of Netflix
286 days
by David Ellis
in data caps, gatekeeping, Heritage Committee, innovation, Internet, Netflix, TV, UBB
by David Ellis + Alexandra Birukova
(Get in on the fun while cutting your reading time by 40%: check out the abridged version of this story posted at the Wire Report on April 26. Any similarity to real life entirely intentional.)
Let’s say for the sake of argument you have near-monopoly control of Internet access in millions of homes. All your retail rates are deregulated, because the regulator has identified a force that faithfully eliminates any market distortion: vigorous competition. And yet, paradoxically, you can use your market power to eliminate competitors on the application layer of your network, since the regulator isn’t sure what unjust discrimination and undue preference might look like. You can also cap customer bandwidth any old way you prefer, which not only drives out competition but adds a nice chunk of change to your bottom line from the overage charges that none of your subs could possibly understand, especially after reading the formulas some math nerd provided in your online FAQ.
Recently renovated office of CRTC Chair, with series of tubes (on left) providing connectivity to global series of tubes. Meter not shown.
Americans still invading, broadcasters still in charge
734 days
Last week Interactive Ontario hosted its first iLunch of the season, entitled “What is broadcast?” (I was involved in some of the planning.) Buddy Brady Gilchrist moderated in his usual immoderate, provocative and enlightened way. Two things kept jumping out.
First, I was surprised to hear a current of old-fashioned jingoism running through much of an otherwise useful discussion. After radio, TV, movies and magazines, now it’s apparently the turn of Google, Apple and the other US cyber-behemoths to be pouring over the 49th parallel and… messing with our digital media? Apparently we have to face up to this menace or… all is lost?
Apple is a menace because it’s taking money out of the country and creating its own new brand of walled garden. Yes and yes. And so what? Where is the biggest concentration of Canadian movies, TV, music and podcasts on the Web, in one place? If it’s not the Canadian iTunes Store, somebody point the way. There was complaining about rev share (is there another system?) and about the tilt to success for artists who get on the iTunes homepage. Yes, and other artists will be suffering in the background, not doing quite as well. That’s show biz. (more…)
The Future of New Media Cancon (1)
869 days
I’ve been working on a presentation for this Tuesday (Sept 22) as part of an Ontario Bar Association confab – New Media: The Emerging Landscape. I’m up for a 40-minute two-hander with Peter Grant. Our session is provocatively entitled The Future of New Media Cancon.
Two very different ideas are on a collision course in the phrase “new media Cancon.” On one hand, Cancon is a regulatory concept with a long, venerable history. It represents decades of painstaking work by the CRTC and others (like PG); it also represents the birth of the Canadian music, film and TV industries where none existed before.
On the other hand, new media Cancon is a contradiction in terms. When the notice was issued last October for the Commission’s 2008-11 proceeding, it was immediately evident this wasn’t going to be a “new media proceeding,” as everyone called it. It was a proceeding about broadcasting, designed to explore how the broadcasting industry could be spared the ravages of that disruptive technology called the Internet. (more…)
Broadband: the vision thing
971 days
[I wrote the following post before a comment arrived on my June 4 entry from old pal Barri Cohen - TV and documentary producer, cultural lobbyist, policy wonk and mother, among other things. Her question is simple: "How did the FCC get a so-called ‘real’ public debate going?" Barri's in luck, because I happen to have had that very question in mind as I was writing this and thinking, once again, about the stark differences between the unfolding broadband debates in Ottawa and Washington.]
Whatever the outcome of the CRTC’s twin proceedings on new media broadcasting and ISP traffic management, Canadian media – old, new and in between – remains a house divided. And the more we talk, the more we get buried in special pleading. Whatever happened to the vision thing?
Our system is built for family quarrels
Regulators spend a lot of time acting as referees among competing interests and reaching comprises that leave everybody at least slightly dissatisfied. But in Canada, the system is rigged to make reasonable compromises almost impossible. It also encourages the main stakeholder groups to fight a zero-sum battle for what they feel they’re owed. Very little of this has anything to do with the needs of the other 99.99% of the population or even a watered-down view of the public interest.
Look how the camps divide up over new media broadcasting. At ground level, the big fight is between those who have money – the BDUs – and those who want money from the BDUs, to wit, the lobbies that represent Canada’s actors, writers, directors and other talent. The other two major stakeholders are the broadcasters, who are in big trouble and want money of a different kind (or else programming concessions from the Commission), and the independent producers, who want the broadcasters to keep buying their stuff. Then there’s the fifth wheel, the webheads who actually make the new media content and whose voices have been drowned out in the battles over yesterday’s idea of what might make Canada great. (more…)
Strategies for broadcasters
986 days
Last week I appeared on TVO’s The Agenda with Steve Paiken, to discuss “Trouble in TV Land” with three industry reps. I tried at several points to pull the discussion away from the never-ending family quarrels between the broadcasters, independent producers and cable guys. These days it’s all about fee for carriage. Whatever the details, the whole industry is constantly embroiled in yesterday’s issues – while the opportunities offered by digital media are passing them by.
Conventional media operators are in deep financial trouble this year. As the table indicates, Veronis Suhler Stevenson estimated in February that broadcast TV revenues will shrink by 9% in 2009 – not as bad as newspapers but no reason for optimism (these are US numbers, but the overall trends hold for Canada). Pure-play Internet and mobile are headed in the opposite direction – despite softening ad revenues in digital media as well.
The battle with cable over fees for carriage is now making it even harder for broadcasters to figure out what their new business models will look like. This in turn adds to the deep suspicion in which many broadcasters hold digital platforms, especially the Web. At the CRTC’s new media hearings, there was much talk about how the Web “cannibalizes” viewers and revenue that would otherwise accrue from TV ads. Until recently, Web sites for most broadcasters existed mainly to move visitors back to where they belong – in front of the TV.
“Promiscuity is the new exclusivity. Get your content everywhere.”
Wish I’d said it, but it was Arianna Huffington in one of her particularly witty moments (as reported by the San Diego News Network). The advice means a) get out of the habit of making your content “special,” as in exclusive, because that just makes it harder for audiences to find it; and b) don’t treat the new platform in town – the Web – as a threat or replacement, but as another way to reach the audience as part of a multi-platform strategy. For content providers, there’s only one way to win the long-term digital game: let go, open up, be inclusive. Otherwise, Canadian broadcasters in particular are in danger of reliving the disaster the music industry has been through.
In fact, there’s a lot to be learned from looking at how the music business has evolved over the last decade. Music has been the canary in the digital coal mine for TV and video. With the outcome of the new media hearing hanging in the balance, here are some ideas that deserve consideration by Canada’s conventional broadcasters:
The audience rules. Broadcasting is a push medium; the Web is a pull medium. “New media broadcasting” is an oxymoron. Stop fighting over cable tiers and fees for carriage, and start worrying about whether your audience is engaged. Yes, this has become a platitude. But learning how to interact with end-users while letting them set the rules of engagement takes planning, practice and patience.
DRM doesn’t work. To the networks and studios, digital rights management has long been a sacrament – like regional coding for DVDs. There’s no empirical way of knowing what the cost-benefit analysis would look like. But there is a reason DRM has now been lifted from all that music on the iTunes Store. If Steve Jobs was able to figure out how to make a business of selling music online in the first place, and his store is now the world’s largest digital music retailer, he must be doing something right.
Online, loyalty is everything. Another platitude worth keeping in mind. In a world with over 200 million Web sites, at least 70 million of which are active, you can’t make your audience stick around, any more than you can make them like your content. And you don’t make your content attractive by making it inaccessible. Loss leaders have worked since the dawn of groceries. As Mike Masnick over at the Techdirt blog is fond of pointing out, making some of your content free – and therefore freely accessible – doesn’t mean you stop making money.
The largest online repository of Canadian content is… the iTunes Store. Or so I said the other night to Steve Paiken. I may be wrong, but I’m not aware of any other Web destination with such an extensive collection of Canadian music, music videos, podcasts, TV shows and the like. The Canadian iTunes store has pulled off something remarkable. It offers all that content without being either regulated or subsidized. The fact that it’s entirely owned and controlled by Apple, Inc. doesn’t change its most important attribute: it operates in response to consumer demand. Does that mean we throw up our hands and let Apple call the shots? Of course not. I just hope Ottawa’s deciders and Canada’s broadcasters will appreciate that in digital media, you can’t subsidize content on the basis of a supply-side strategy – and keep hoping that if you build it, they will come.
TV is dead. TV still king. News at 11.
1045 days
I taught an undergraduate seminar on broadcasting policy a couple of years ago. I began the proceedings with one of my cheap attention-getters. “Broadcasting is dead. So what are we going to do for the rest of the year?”
The question wasn’t entirely rhetorical then and still isn’t today. In this post, I’m going to look at three very different points of view on the state of television: from the forecasters at New York’s leading media investment bank; the firm that founded market research; and the irrepressible Brady Gilchrist, Richard Stursberg’s new media nemesis.
Media investment bank Veronis Suhler Stevenson has an impressive record for its long-term forecasts in consumer and B2B media. In its 2009 Mid-Term Forecast, released in February, VSS looked at 20 communications industry segments and found that the two worst performers in 2009 (measured by “media spend”) will be newpaper publishing, contracting by 16.2%, and broadcast television, contracting by 9.0%. No surprise on item one, with all the recent news about newspapers disappearing in major markets like San Fransisco, especially as newspapers were already posting negative growth of 13.5% in 2008.
Broadcast TV is more of a shocker, partly because TV growth stayed almost flat in 2008 (dropping 0.5%). As always, this kind of decline is meaningful only when you look at how other media channels have been doing over the same period. Badly. VSS claims that ad spending across all media will drop 7.4% this year, the first 2-year decline in 75 years. Even the big growth segment, Pure-Play Internet & Mobile Services (aka digital media), is now expected to grow at a much slower rate in 2009 than VSS forecast last August. They’ve revised their forecast down from 15.5% to 9.1%.
As the wag said, there are no facts in the future. But it’s hard to argue with the two main reasons offered by VSS for their numbers. Traditional media segments are facing i) competitors that offer “stronger proof-of-performance and ROI metrics at lower price points”… and ii) fragmentation of consumers and brand strategies across “multiple venues and platforms.” (more…)
