Telcos and broadcasters take their regulatory battles directly to the public – but does it work?

No longer content to rely solely on regulatory and Cabinet appeals, a growing number of communications companies are taking their battles directly to the court of public opinion. MTS Allstream Inc., CTVglobemedia Inc., Canwest Global Communications Inc., and the CBC are among those who have launched high-profile campaigns to sway politicians and the public against CRTC decisions they say are detrimental to their businesses. But some analysts question the effectiveness of such drives. Last week, MTS Allstream, supported by the Canadian Association of Internet Service Providers (CAIP), launched a public relations campaign against major telecom players Bell and Telus. It follows the CRTC’s rejection of an MTS Allsteam appeal on Dec. 11, 2008 regarding the classification of wholesale Ethernet services, which the Manitoba-based company wants reviewed and adjusted. (See today’s article, “Appeals to CRTC’s usage-based billing decision mount”) Specifically, MTS Allstream wants the CRTC to repeal a stipulation that bars competitors from accessing network facilities built by Bell and Telus on the grounds that deregulation has opened up competition among telecom players and eradicates monopoly of these network facilities built by incumbents prior to deregulation in the late ‘90s. The MTS Allstream campaign features a website warning consumers and politicians that telecom and broadband prices will “skyrocket unless you act soon.” “On the first day we had over 4500 messages that were sent to the government through the website supporting our call for the government to vary the CRTC decision,” says Chris Peirce, chief corporate officer for MTS. The Manitoba telco has also written to the Privy Council urging it to review the CRTC decision. Likewise, CTV, Canwest Global, and the CBC have joined forces to launch a national campaign against “misinformation” by cable and satellite companies regarding the contentious fee-for-carriage issue ahead of the November hearings in which the CRTC will further examine the challenges facing the broadcast sector. A petition on the website www.localtvmatters.ca urges consumers to write to their MPs and the CRTC urging that “cable and satellite companies should pay for the signals they distribute.” But Mal Raddalgoda, a consultant with telecom consulting firm Schooley Mitchell, doubts such campaigns will result in tangible results. “The idea that a media campaign or an Internet campaign will do that, I am skeptical unless it’s a high-level issue for the consumers,” he says. Raddalgoda says for a campaign to be effective, it must be an issue that affects the lives of consumers directly. “If this was an issue of political importance like they were going to directly change the minimum wage or change the tax rate, you would get consumers reacting very differently because everyone’s affected and it’s a grassroots issue. Telecommunications costs? Not sure if that’s high enough on people’s issues.” He says that’s why a media campaign launched last month by broadcasters on fee-for-carriage did not catch on with the public. Broadcasters had warned that fee-for-carriage will result in price increases in their monthly cable bills. “How big is the hike? Will it force me to look at another alternative?,” he asks. Raddalgoda argues that competitiveness is what lowers prices for consumers, not campaigns to sway politicians and the public. He adds that campaigns targeting politicians and the public tend to miss the point about the choices available to consumers. For instance, he says companies offer customers saving incentives in the form of “bundles” that combine phone, cable and Internet services. He doubts such incentives will spur a consumer revolt. Telecom consultant Mark Goldberg, of Mark H. Goldberg & Associates Inc., says he’s concerned media campaigns ignore the role of institutions that deal with regulatory matters. “We don’t govern—at least in this democracy—by sending everything out to referendum. We elect our leaders and look to our leaders to demonstrate leadership, to make decisions based on what’s right not what’s popular,” he says. “I don’t think we want to live in a society where the rule of law is based on which side shouts the loudest.” Goldberg says if any party feels aggrieved, especially in highly technical matters such as the kind raised by the MTS Allstream coalition, it should exhaust all attempts with the CRTC. If still unsuccessful, the company should appeal to the courts. By directly appealing to politicians, Goldberg says it raises questions about transparency, an issue he notes was observed by the Telecom Review Panel which recommended that the political review process be dismantled over fears about transparency. MTS Allstream’s appeal avenues with the CRTC have already been exhausted. It is now appealing to cabinet, but time is running out. Under the Telecom Act, cabinet has one year to respond to an appeal and its deadline for MTS is Dec. 11. If an election is called before then, the appeal may be in jeopardy.

Telcos and broadcasters take their regulatory battles directly to the public – but does it work?

Broadcast | September 14, 2009

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