Canadian Heritage – not CRTC – should deal with Internet broadcasting policies: Seaboard

Next month's new media hearing isn't likely to address the challenges of broadcasting on the Internet and it is time to transfer policy issues from the CRTC to Canadian Heritage, says a report from the SeaBoard Group, an independent marketing and technology research company with offices in Toronto and Montreal. The report, titled Paradise Lost: On the future of television and the challenge for Canadian public policy, suggests that the CRTC's limited and archaic mandate renders the public regulator incapable of addressing complex challenges to the business models of IP technologies in as far as broadcasting is concerned. It also suggests the CRTC is unlikely to make any headway on the challenges within the current policy framework. "The changes that are about to sweep through the industry and our electronic infotainment system are bigger than an agency established to monitor the industry of the 1970s can comprehend, much less control," says the report. Seaboard says the CRTC's role should be restructured. The "heavy lifting of policy" should be moved to Canadian Heritage, while administrative issues are left to the CRTC, because of the department's primary role of reflecting Canadian values. However, the report also sees Heritage succumbing to some of the CRTC's regulatory controls, such as restrictions on BDUs and broadcasters and mechanisms like the Canadian Television Fund when it shoulders the policy responsibility after taking over from the CRTC. The report warns that this would be a mistake. The report, which also examines how the Internet will change broadcasting, says television is not dead but the current TV distribution model is not feasible because of the advent of Internet-based storage, retrieval, and delivery mechanisms. Factors reshaping the current television economic model include the increased use of Personal Video Recorders (PVRs), Internet sites or other web-based programming outlets like Apple TV, Amazon, Hulu, and Bit Torrent and disillusionment with the bill-of-programming-fare on offer. While warning of the eventual end of television as we know it, the report says it might still take a while because while the technology exists, mass adoption by the public is still slow. "But the end of TV for the 14-year-old might have happened already," says Iain Grant, CEO, SeaBoard, in an interview. The report says the real question that should be addressed is "how long is a while?" It posits that the CRTC does not feel the urgency, as manifested by its timelines such as the expected switch to digital in 2011. The report warns that the shift to IPTV will significantly affect the business models employed by traditional television and broadcasters and advertisers would be wise to adjust accordingly. "Advertisers will no longer look to back a program based on just number of eyeball ratings, or supposed target audience. The money will flow to those that can deliver specific audiences," says the report. Grant also rejects the idea of an ISP levy, similar to that imposed on BDUs to fund television production, describing it as "a silly idea". The report adds that the financial viability of BDUs will continue to be strong as they learn to tap their IP abilities. The 49-page report was prepared for SeaBoard's clients. Coming a month before the Feb. 17 CRTC hearing on new media, it provides a snapshot of potential arguments to be presented before the CRTC, and the disdain some companies feel about the controversial suggestion of an ISP levy.

Canadian Heritage – not CRTC – should deal with Internet broadcasting policies: Seaboard

Broadcast | January 28, 2009

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