All sides continue fight in Streaming Act regulation proceeding

The CRTC has now received reply comments in its ongoing proceeding into how to implement the Online Streaming Act. As with the original interventions, proposals vary depending on the group submitting the suggestions. The Documentary Organization of Canada (DOC) calls for online undertakings to reveal the date they began operating in Canada, their annual revenues, operational model, and how much Canadian content is available. It disagreed with calls to exempt smaller players from the regulation. “DOC agrees with many intervenors that exempting smaller online entities from the registry is premature and would be contrary to the goal of capturing the largest number of participants who are contributing to the broadcasting system,” it wrote. Previous filings revolved around the revenue threshold that should be established for inclusion in the regime. The commission suggested $10 million; applicants proposed everything from a low of $1 million to a high of $50 million. University of Ottawa law professor Michael Geist called for an evidence-based approach to setting up the threshold. He endorsed the $50 million figure, stating that the number had been reached based on an established standard. He also warned that content-based exemptions could lead to making the CRTC into a content moderator. “The commission must ensure that content exemptions do not become content regulation by another name,” the professor said. He also criticized proposals to repeal exemption orders for digital media broadcasting undertakings (DMEO) and video-on-demand undertakings (VODEO). Doing so could let vertically-integrated services like BCE Inc.’s Bell and Rogers Communications Inc. set up services not available to users of other carriers. Telus Corp. told the CRTC not to take a siloed approach to online and traditional broadcasters. “The commission should therefore reject arguments and proposals premised on the notion that competitive safeguards, such as those found in the DMEO, are only applicable to traditional platforms because they are ‘closed’ or ‘walled’ distribution systems, and that vertical integration concerns are limited to that environment,” the western telecom wrote. “At a minimum, if the commission decides to exempt online undertakings that provide unique transactions from regulation, then it should exempt licensed transactional VOD services at the same time.” It also called for undue preference rules to prevent exclusivity in distribution deals. The Motion Picture Association Canada said that if niche foreign online undertakings are not exempted, they may not enter Canada at all. It also endorsed the idea of keeping the category of exempt undertakings open in order to provide for occasional revisions. MPA Canada favours raising the threshold limit from $10 million, but it did not suggest a specific figure. One of those foreign operations, Netflix Services Canada ULC, backed the MPA Canada brief and cautioned against too-strenuous regulation. In a short submission, Blue Ant Media Inc. flagged the dire circumstances facing broadcasters today. “Traditional CRTC-licensed Canadian broadcasters need immediate relief from their regulatory obligations so that they can meaningfully compete in the marketplace, and the commission cannot delay this critical piece of the equation until the end of its process,” Blue Ant wrote in a four-paragraph letter. Saskatchewan Telecommunications Holding Corp. also put forward the notion of light regulation in its brief to the regulator. SaskTel said any exemptions granted to online undertakings should be similarly applied to traditional outlets such as its own. Lobby group OpenMedia endorsed the $50 million threshold and took up the cause of niche foreign undertakings. “Many diasporic Canadians rely on niche foreign services to maintain essential cultural connections with the wider world,” it wrote. “Imposing rigid or vague legal requirements that demand these services to meet Canada-specific content obligations may force these platforms to deny service to internet users in Canada to avoid regulatory complications.” One such niche service is Hayu, a broadcaster of American reality television owned by Universal Pictures Subscription Television Ltd. It maintained that its programming is unlikely to contribute to Canadian broadcasting objectives. In their original interventions, Bell and the Canadian Association of Broadcasters (CAB) had called for the exemption of online news from regulation. Apple Canada Inc. is in their corner. “In particular, Apple shares Bell’s views that such an exemption would be in the public interest, given that: (a) online news today consists of different media that should not be treated differently depending on whether or not it consists in part of ‘broadcasting’; and (b) the business case for local news suggests regulation is unnecessary,” the tech giant wrote. It suggests its business model of transactional service mirrors that of a home video store, an enterprise which was never subject to CRTC regulation. In its reply, the CAB suggested a $20 million threshold and repeated its call for an online news exemption. The association said undue preference provisions should apply to all online undertakings. Pelmorex Weather Networks (Television) Inc. agreed with others that the threshold for registration should be lower than the threshold for regulation. It said as a small operator its resources pale in comparison to those of large foreign players who may be exempt under current proposals. The Writers Guild of Canada said it could not adequately comment on the monetary threshold since the evidence has not been presented to stakeholders. It opposed increasing the limit from $10 million and endorsed the concept of different thresholds for registration and regulation. It is also against the waiver for online news operations. The Directors Guild of Canada also proposed different thresholds for registration and regulation and added the further twist of suggesting different thresholds for the French- and English-speaking markets. The regulator’s registration regime should bring in the widest possible number of online undertakings that contribute to the Canadian system. Getting as many players as possible into the regime was the goal of the National Campus and Community Radio Association. It favours a $2.5 million threshold even if smaller companies were only registered for the purposes of data collection. A consortium of music industry associations, filing under the name ACCORD, opposed raising the threshold from $10 million. “Raising the revenue threshold above $10 million for the proposed registration requirements would simply limit the information on online undertakings available to the commission, deflating the objective of this consultation,” ACCORD stated. The Independent Broadcast Group asserted that the thresholds should be separate for registration and other commission mandates, such as contribution payments. It also spoke against the exemption for online news outlets. “t would be premature to exclude all podcasting platforms from registration and condition of service requirements,” according to Corus Entertainment Inc. “Podcasting clearly falls within the legislative definitions of ‘program’ and ‘broadcasting’, and the platforms that distribute podcasts are presumptively ‘online undertakings’.” It also spoke in favour of undue preference regulations, quarreling with intervenors who said competition law would suffice. One of those intervenors was the Digital Media Association (DiMA). It worried that use of the regulations could have an impact on business agreements which extend beyond Canada’s borders, and therefore, the Streaming Act’s jurisdiction. Google LLC reiterated its call for a $50 million threshold and called for an exemption for transactional video on demand (TVOD). The CRTC timelines came under attack from the Forum for Research and Policy in Communications (FPRC). Interested parties had only 10 days to respond to the initial notice of consultation. FPRC filed an access to information request for documentation on how the commission reached its $10 million figure. The regulator asked for an extension on releasing the material, meaning it will be at least three months before the group gets its data. BCE said the hybrid video on demand (HVOD) should be treated as online services and not removed from the VODEO. It chided one of its competitors for taking a contrary view. “An opposing voice is Quebecor , which is unsurprising given that they offer HVOD services: Club illico and Vrai,” the telecom giant wrote. It also raised the prospect of undue preference being offered. The Canadian Media Producers Association joined other groups in saying it could not assess the appropriateness of the $10 million threshold because the commission needed to provide more information. It opposed the news content exemption. In a lengthy submission, Rogers Communications Inc. said the regulator must have three priorities: reducing the burden on traditional broadcasters, offsetting the costs on Canadian broadcasting ownership groups, and looking at the competitive advantages going to foreign streaming services. It echoed the calls for news content exemptions but opposed the suggestion that podcasts be exempt. It is neutral on the $10 million threshold but is against lowering it. Spotify wants audiobooks to be exempt from regulation. The Public Interest Advocacy Centre lamented the lack of transparency in how the regulator arrived at the $10 million number. It also questioned the seeking of exemptions for audiobooks, podcasting and adult entertainment. SiriusXM Canada Inc. recently lost an application to defer Canadian content development (CCD) shortfalls. It criticized the commission for that and similar decisions. “The CRTC does not appear to be concerned about the dire situation facing traditional broadcasters or their need for regulatory relief,” the satellite radio network stated. It suggested raising the regulation threshold to $25 million. Cogeco Inc. said a $20 million limit would be appropriate. –Reporting by Paul Park at ppark@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca

All sides continue fight in Streaming Act regulation proceeding

News | 06/30/2023 5:13 pm EDT

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