Von Finckenstein tells broadcasting industry to lobby Tories for regulatory change

CRTC chair Konrad von Finckenstein laid out new details in his call for an overhaul of Canada’s communications regulatory framework Thursday and called on the broadcasting industry to form a new organization to lobby the Conservative government for change. “In order to make your case, you must organize yourselves and speak with one voice,” von Finckenstein said in a speech to the Broadcasting Invitational Summit in Cambridge, Ont. “The Canadian Cable Television Association, the Specialty and Premium Television Association and the Canadian Association of Broadcasters are either gone or playing a diminished role. There is no body that can speak with authority for the large vertically integrated players. A new organization is needed to propose plans for change.” Some broadcasting groups have banded together to ask the CRTC to open a proceeding to study the role of over-the-top streaming services like Netflix Inc. in the Canadian broadcasting system—as well as their potential regulation. But von Finckenstein appeared reluctant to concede to that request Thursday, telling broadcasters to push the newly elected majority Conservative government to issue a direction to the CRTC to study the issue under section 15 of the Broadcasting Act. “A section 15 direction would be an appropriate way to address the issue of over-the-top services. I urge you to ask the government to use this power,” von Finckenstein said. But the Conservatives have expressed skepticism of the proposal for such a proceeding. In a mid-campaign interview with The Wire Report, Industry Minister Tony Clement said he is concerned that the request for a consultation on over-the-top streaming services could be a “Trojan horse” for regulation and result in less choice and competition in the marketplace. In the speech Thursday, von Finckenstein repeated his calls for a rethink of Canada’s broadcasting and telecom regulatory frameworks, referring to his proposal for a converged act to govern the communications system and to move responsibilities for spectrum licensing from Industry Canada to the CRTC. He said the creation of a new communications act would require significant consultation and could include: a statement on the communication system’s economic, social and cultural objectives; a structure for the “optimum regulation” of the wireless and wireline transmission of digital information, either voice or data; a clear delineation of policy responsibilities that should be left to the government and powers assigned to the regulator; specific provisions on regulatory powers, such as administrative monetary penalties, the mandatory adoption of codes, and the “explicit power to impose arbitration”; a regime to support Canadian content “by way of exemption, exception or subsidies, or a combination of all three”; and the obligations and responsibilities of Canada’s public broadcaster, including a definition of its role, which “could be set out in a separate part of the act, or, as I would recommend, in a separate statute.” “The government will welcome a unified view from the industry before undertaking major reforms. It is in the interest of the industry—your interest—to change a system whose governing legislation was last updated 20 years ago,” von Finckenstein said. He noted that Canada’s communications industry—now that Shaw Communications Inc. has purchased the broadcasting assets of the former Canwest Global Communications Corp. and BCE Inc. has purchased CTVglobemedia Inc.—is more vertically integrated than that in any other country in the world. He said the communications industry has “wisely hedged its bets” by investing in both content and distribution platforms, and that with a few “significant independent players that contribute mightily to the diversity of the system,” Canada probably has a “model that can work in most mid-sized economies like ours.” Still, he warned that the level of vertical integration in Canada may not be sustainable. “It is possible that vertical-integration bets will fail, and investments in distribution assets combined with content assets will diminish in value. At the same time, independent broadcasters and distributors may not survive under the present arrangements,” von Finckenstein said. “We all know that it takes years to develop and implement new legislation. You have to speak up and you have to do so now. The new government will be receptive to bold new ideas, but you must act quickly.” news@thewireport.ca

Von Finckenstein tells broadcasting industry to lobby Tories for regulatory change

Broadcast | May 5, 2011

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