Re: Broadcasting Public Notice CRTC 2008-44 - Call for comments on the scope of a future proceeding on Canadian broadcasting in new media
July 9, 2008
Mr. Robert A. Morin
Secretary General
Canadian Radio-television and Telecommunications Commission
Ottawa, Ontario
K1A 0N2
Dear Mr. Morin:
FRIENDS of Canadian Broadcasting is an independent watchdog for Canadian programming in the English-language audiovisual system, supported by 100,000 Canadians. We are pleased to have the opportunity to provide preliminary comments on this important consultation on new media.
FRIENDS wishes to compliment the Commission for creating an online blog-like consultation process facilitated by Nanos Research to provide interested Canadians with the opportunity to comment not only on the topic at hand, but also on other submissions.
We believe that this dialogue has been useful by providing an unvarnished look at Canadians' views on Internet content.
In previous submissions, FRIENDS has stressed the importance of ensuring the presence of thriving and dynamic Canadian content in the new media environment. We consider this review timely.
As the Commission has outlined clearly in its Public Notice, much has happened since the initial exemption order issued in 1999. The Internet is now very clearly competing with existing over-the-air broadcasters for both audience and advertising revenues. FRIENDS believes that a clear lesson to be gleaned from the changes that we have witnessed since 1999 is that the regulatory process must stay ahead of the ongoing tidal wave of change. In the words of Wayne Gretzky: "I skate to where the puck is going to be, not to where it has been".
We also note, with approval, the following comment of the Commission's Chair at the May 13, 2008 session of the House of Commons Standing Committee on Canadian Heritage:
A critical aspect of these technological changes is geographic filtering, which has allowed the Internet to become much more defined by rationing access to specific sites. As an example, a Canadian visitor seeking to access streaming video from the CBS
Innertube website would be prevented from doing so. Similarly, American visitors from the Central or Pacific Time zones are not allowed access to content in advance of its normal time of airing in their community. In 1999, the web was more accurately described as a "World Wide" Web, as addressability of this type did not widely exist.
While there is an obvious technological difference between the broadcast spectrum and the Internet, FRIENDS argues that, from a public policy perspective, the principle of public ownership applies equally. It is therefore critical that the Internet in general, and specifically professional/commercial Internet broadcasters of audio and visual content, maintain a level of
Canadian programming which is consistent with the expectations of the Broadcasting Act.
Here follow FRIENDS' responses to the specific questions posed by the Commission in its Public Notice.
WHAT IS THE SCOPE OF NEW MEDIA BROADCASTING?
Is the new media broadcasting environment contributing sufficiently to the achievement of the broadcasting policy objectives of the Act?
While we fully understand the technical differences between traditional over-the-air broadcasting and professional/commercial Internet or mobile broadcasting, from a consumer's point of view these technologies are rapidly merging. Therefore, if a vibrant Canadian audio-visual presence is to exist, it is vital that the expectations and obligations placed on professional/commercial broadcasters in both traditional and new media be similar.
Most over-the-air radio stations stream their content on the Internet, effectively replicating their Canadian content obligations on the web. More recently, Canadian television groups have begun offering access to certain episodes of their most popular shows over the web. We observe that the vast majority of these episodes are US network shows, but there is also a strong presence of Canadian news and information on these websites and on portals such as Sympatico MSN and Rogers Yahoo.
On the other hand, exclusively Internet broadcasters such as Iceberg Media, which was founded in 1997 and now offers more than 100 channels of streaming audio, are not required to maintain any level of Canadian programming. This is certainly not to suggest that the Iceberg channels are not making a CanCon contribution. But without monitoring output channel by channel, there is no way of knowing with any degree of confidence what level of Canadian programming is present.
In particular, as FRIENDS has noted in past submissions with regard to mobile devices, we see very little difference between the advent of the pocket transistor radio in the 1950s and today's PDAs in terms of content distribution. Just as public policy at that time took the transistor radio in stride, so it is vitally important today that a reasonable amount of content on new media, whether audio or video, should be Canadian.
How should new media be defined?
FRIENDS is in full agreement with the Commission's definition of new media because it appears to capture both existing and contemplated sources of audio-visual content which use the Internet for distribution.
However, we consider it important to differentiate professional programming content (usually created for commercial purposes) from so-called user-generated content that is posted on social sites such as Facebook and YouTube. Defining this distinction will be essential if the Commission contemplates, as we recommend, some form of minimum Canadian programming commitments for Internet broadcasting undertakings.
Is an approach which differentiates between downloaded broadcasting content and new media broadcasting necessary? If so, how should these terms be defined?
FRIENDS does not believe that this differentiation is necessary. While it is important to have a clear and unequivocal Canadian programming presence on new media broadcasting channels, it is equally important to have this same Canadian presence in the content available for download from existing broadcasters, and others. A cursory examination would suggest that at present, with the exception of news, the vast majority of titles available either for download or real-time viewing are in fact US network shows.
ARE INCENTIVES OR REGULATORY MEASURES REQUIRED FOR THE CREATION AND PROMOTION OF CANADIAN NEW MEDIA BROADCASTING CONTENT?
During the Commission's recently concluded review of the regulatory framework for broadcasting distribution undertakings and discretionary programming services, the notion of 'market forces' was strongly advocated from the outset, both in the Dunbar/LeBlanc report and by virtually all of the BDUs that appeared before the Commission. Many other parties, including FRIENDS, warned during the submission phase and at the hearing itself that the wholesale adoption of market forces would have a significant negative impact, not only on the delicate balance that exists between broadcasters and BDUs (especially within the specialty environment), but also on the overall quantity, quality and diversity of Canadian programming that would result if the level of deregulation contemplated by the BDUs were to flow from that hearing.
In the absence of regulation, audio-visual content available on the Internet has been guided largely by market forces, given that Canadians can choose virtually whatever content and websites they wish. The opportunity, therefore, exists for the Commission to examine what level of Canadian programming has developed in this 'market forces' environment in order to determine whether or not this content level is appropriate. In general, it has been our experience that the adage 'what gets measured gets done' has held true and that, in the absence of regulation, the 'natural' level of Canadian programming is significantly lower on Canadian Internet sites that feature professional/commercial broadcasting than on regulated over-the-air radio and television stations. This contention could be measured.
There is no question that there exists a Canadian presence on the Internet, but our preliminary examination suggests that a significant portion of professionally-produced Canadian audio-visual programming is in fact news-related. While it is not our intention to denigrate the importance of news, we believe that there is an opportunity for a much more diverse Canadian programming contribution. It is also our view that, over time, the Internet will continue to attract listeners from existing over-the-air radio stations and ultimately, more viewers from over-the-air television. Ultimately, if the contribution to Canadian programming made by Canadian Internet media is lower, then it will be only a matter of time before regulated broadcasters will arrive at the Commission's door petitioning to reduce their Canadian content obligations.
If the Commission has not already gathered information on Canadian programming available from new media broadcasters, research at the front end of this consultation should provide a clear indication of their contribution to Canadian programming within the existing market forces scenario. From this baseline, the Commission could then determine whether and the extent to which regulatory intervention is necessary.
ARE THERE ANY BARRIERS TO ACCESSING CANADIAN NEW MEDIA BROADCASTING CONTENT?
As described in the Commission's public notice, high-speed residential Internet access is now available to 93% of Canadian households and more than 60% of households now have signed up for high speed connections. This makes Canada one of the world's leaders in broadband connectivity. From a purely technical perspective, therefore, access to high speed Internet does not appear to be a barrier to accessing new media broadcasting content for a majority of Canadians. However, the 7% and the 40% are also an important consideration in public policy.
For consumers to access Canadian new media broadcasting, however, the content must be available in the first place. As described above, it is not at all clear what level of Canadian presence currently exists through Canadian new media broadcasting channels. Research on current levels of Canadian professionally-produced new media broadcast content availability will be a very important benchmark for measurement going forward. While most, if not all of the leading Canadian ISPs also have powerful portals with a myriad of content options, the fact that the content was assembled in Canada does not necessarily make it Canadian.
One additional concern is the possibility that access to websites that might be considered competitive to the business interests of the subscriber's ISP or its affiliated companies, might be blocked for competitive reasons. While this is clearly antithetical to the spirit of the Internet, it is a hypothesis that we believe the Commission should specifically examine in the context of new media broadcasting as part of this consultation.
WHAT OTHER POLICY OBJECTIVES SHOULD BE CONSIDERED WITHIN THE SCOPE OF THIS PROCEEDING?
As we acknowledge above, the Commission has recently begun its examination of traffic shaping and speed throttling techniques that are currently being employed by some BDUs that provide Internet access services. FRIENDS considers the network neutrality issue a critical aspect of a new media broadcasting review. If technological gatekeepers are allowed to determine which content takes priority, or is allowed access at all, freedom of speech and the public space will be significantly diminished.
As the Commission is well aware, there is a high degree of ownership concentration in the BDU sector, and a high percentage of the overall ISP market is also controlled by these same BDUs either directly at the retail level, or at the wholesale level.
Recently BDUs have introduced a supplementary bandwidth charge, no doubt in anticipation of the much greater viewing of video content that will take place in the future. The BDUs' argument seems based on the not unreasonable logic that fees charged should be based on bandwidth used. We note, however, that a similar logic does not seem to apply when it comes to compensating local over-the-air channels whose services are carried at a profit to the BDU without compensation.
More important, BDUs engage in several business segments which are highly competitive and should not be permitted to misuse their dominant position as distributors to engage in anti-competitive behaviour. As we have previously stated, BDUs endorse 'market forces' because they ARE the market force – a principle that became abundantly clear towards the end of the BDU/Specialty hearing.
The following is one of the comments posted on the Commission's E-consultation site from a writer identified only as 'leithal'. That writer, in our view, summarized the issue of net neutrality and its relevance to new media broadcasting succinctly:
Yours sincerely,
Ian Morrison
Spokesperson
For information: Jim Thompson 613 567 9592
Secretary General
Canadian Radio-television and Telecommunications Commission
Ottawa, Ontario
K1A 0N2
Dear Mr. Morin:
FRIENDS of Canadian Broadcasting is an independent watchdog for Canadian programming in the English-language audiovisual system, supported by 100,000 Canadians. We are pleased to have the opportunity to provide preliminary comments on this important consultation on new media.
FRIENDS wishes to compliment the Commission for creating an online blog-like consultation process facilitated by Nanos Research to provide interested Canadians with the opportunity to comment not only on the topic at hand, but also on other submissions.
We believe that this dialogue has been useful by providing an unvarnished look at Canadians' views on Internet content.
In previous submissions, FRIENDS has stressed the importance of ensuring the presence of thriving and dynamic Canadian content in the new media environment. We consider this review timely.
As the Commission has outlined clearly in its Public Notice, much has happened since the initial exemption order issued in 1999. The Internet is now very clearly competing with existing over-the-air broadcasters for both audience and advertising revenues. FRIENDS believes that a clear lesson to be gleaned from the changes that we have witnessed since 1999 is that the regulatory process must stay ahead of the ongoing tidal wave of change. In the words of Wayne Gretzky: "I skate to where the puck is going to be, not to where it has been".
We also note, with approval, the following comment of the Commission's Chair at the May 13, 2008 session of the House of Commons Standing Committee on Canadian Heritage:
"I would like to be clear on one point. Our interest primarily lies in the distribution of professionally produced broadcasting content. That is, the same kind of high-quality Canadian content you would normally watch on television or hear on the radio. Our ultimate aim is to ensure that broadcasting in new media contributes to the achievement of the objectives of the Broadcasting Act."FRIENDS contends that a Canadian presence should be an integral, positive and creative part of this developing technology. Otherwise, we risk a more costly retroactive system, one that might be more readily opposed as a 'tax' if Canadian content rules were to be imposed after the fact.
A critical aspect of these technological changes is geographic filtering, which has allowed the Internet to become much more defined by rationing access to specific sites. As an example, a Canadian visitor seeking to access streaming video from the CBS
Innertube website would be prevented from doing so. Similarly, American visitors from the Central or Pacific Time zones are not allowed access to content in advance of its normal time of airing in their community. In 1999, the web was more accurately described as a "World Wide" Web, as addressability of this type did not widely exist.
While there is an obvious technological difference between the broadcast spectrum and the Internet, FRIENDS argues that, from a public policy perspective, the principle of public ownership applies equally. It is therefore critical that the Internet in general, and specifically professional/commercial Internet broadcasters of audio and visual content, maintain a level of
Canadian programming which is consistent with the expectations of the Broadcasting Act.
Here follow FRIENDS' responses to the specific questions posed by the Commission in its Public Notice.
WHAT IS THE SCOPE OF NEW MEDIA BROADCASTING?
Is the new media broadcasting environment contributing sufficiently to the achievement of the broadcasting policy objectives of the Act?
While we fully understand the technical differences between traditional over-the-air broadcasting and professional/commercial Internet or mobile broadcasting, from a consumer's point of view these technologies are rapidly merging. Therefore, if a vibrant Canadian audio-visual presence is to exist, it is vital that the expectations and obligations placed on professional/commercial broadcasters in both traditional and new media be similar.
Most over-the-air radio stations stream their content on the Internet, effectively replicating their Canadian content obligations on the web. More recently, Canadian television groups have begun offering access to certain episodes of their most popular shows over the web. We observe that the vast majority of these episodes are US network shows, but there is also a strong presence of Canadian news and information on these websites and on portals such as Sympatico MSN and Rogers Yahoo.
On the other hand, exclusively Internet broadcasters such as Iceberg Media, which was founded in 1997 and now offers more than 100 channels of streaming audio, are not required to maintain any level of Canadian programming. This is certainly not to suggest that the Iceberg channels are not making a CanCon contribution. But without monitoring output channel by channel, there is no way of knowing with any degree of confidence what level of Canadian programming is present.
In particular, as FRIENDS has noted in past submissions with regard to mobile devices, we see very little difference between the advent of the pocket transistor radio in the 1950s and today's PDAs in terms of content distribution. Just as public policy at that time took the transistor radio in stride, so it is vitally important today that a reasonable amount of content on new media, whether audio or video, should be Canadian.
How should new media be defined?
FRIENDS is in full agreement with the Commission's definition of new media because it appears to capture both existing and contemplated sources of audio-visual content which use the Internet for distribution.
However, we consider it important to differentiate professional programming content (usually created for commercial purposes) from so-called user-generated content that is posted on social sites such as Facebook and YouTube. Defining this distinction will be essential if the Commission contemplates, as we recommend, some form of minimum Canadian programming commitments for Internet broadcasting undertakings.
Is an approach which differentiates between downloaded broadcasting content and new media broadcasting necessary? If so, how should these terms be defined?
FRIENDS does not believe that this differentiation is necessary. While it is important to have a clear and unequivocal Canadian programming presence on new media broadcasting channels, it is equally important to have this same Canadian presence in the content available for download from existing broadcasters, and others. A cursory examination would suggest that at present, with the exception of news, the vast majority of titles available either for download or real-time viewing are in fact US network shows.
ARE INCENTIVES OR REGULATORY MEASURES REQUIRED FOR THE CREATION AND PROMOTION OF CANADIAN NEW MEDIA BROADCASTING CONTENT?
During the Commission's recently concluded review of the regulatory framework for broadcasting distribution undertakings and discretionary programming services, the notion of 'market forces' was strongly advocated from the outset, both in the Dunbar/LeBlanc report and by virtually all of the BDUs that appeared before the Commission. Many other parties, including FRIENDS, warned during the submission phase and at the hearing itself that the wholesale adoption of market forces would have a significant negative impact, not only on the delicate balance that exists between broadcasters and BDUs (especially within the specialty environment), but also on the overall quantity, quality and diversity of Canadian programming that would result if the level of deregulation contemplated by the BDUs were to flow from that hearing.
In the absence of regulation, audio-visual content available on the Internet has been guided largely by market forces, given that Canadians can choose virtually whatever content and websites they wish. The opportunity, therefore, exists for the Commission to examine what level of Canadian programming has developed in this 'market forces' environment in order to determine whether or not this content level is appropriate. In general, it has been our experience that the adage 'what gets measured gets done' has held true and that, in the absence of regulation, the 'natural' level of Canadian programming is significantly lower on Canadian Internet sites that feature professional/commercial broadcasting than on regulated over-the-air radio and television stations. This contention could be measured.
There is no question that there exists a Canadian presence on the Internet, but our preliminary examination suggests that a significant portion of professionally-produced Canadian audio-visual programming is in fact news-related. While it is not our intention to denigrate the importance of news, we believe that there is an opportunity for a much more diverse Canadian programming contribution. It is also our view that, over time, the Internet will continue to attract listeners from existing over-the-air radio stations and ultimately, more viewers from over-the-air television. Ultimately, if the contribution to Canadian programming made by Canadian Internet media is lower, then it will be only a matter of time before regulated broadcasters will arrive at the Commission's door petitioning to reduce their Canadian content obligations.
If the Commission has not already gathered information on Canadian programming available from new media broadcasters, research at the front end of this consultation should provide a clear indication of their contribution to Canadian programming within the existing market forces scenario. From this baseline, the Commission could then determine whether and the extent to which regulatory intervention is necessary.
ARE THERE ANY BARRIERS TO ACCESSING CANADIAN NEW MEDIA BROADCASTING CONTENT?
As described in the Commission's public notice, high-speed residential Internet access is now available to 93% of Canadian households and more than 60% of households now have signed up for high speed connections. This makes Canada one of the world's leaders in broadband connectivity. From a purely technical perspective, therefore, access to high speed Internet does not appear to be a barrier to accessing new media broadcasting content for a majority of Canadians. However, the 7% and the 40% are also an important consideration in public policy.
For consumers to access Canadian new media broadcasting, however, the content must be available in the first place. As described above, it is not at all clear what level of Canadian presence currently exists through Canadian new media broadcasting channels. Research on current levels of Canadian professionally-produced new media broadcast content availability will be a very important benchmark for measurement going forward. While most, if not all of the leading Canadian ISPs also have powerful portals with a myriad of content options, the fact that the content was assembled in Canada does not necessarily make it Canadian.
One additional concern is the possibility that access to websites that might be considered competitive to the business interests of the subscriber's ISP or its affiliated companies, might be blocked for competitive reasons. While this is clearly antithetical to the spirit of the Internet, it is a hypothesis that we believe the Commission should specifically examine in the context of new media broadcasting as part of this consultation.
WHAT OTHER POLICY OBJECTIVES SHOULD BE CONSIDERED WITHIN THE SCOPE OF THIS PROCEEDING?
As we acknowledge above, the Commission has recently begun its examination of traffic shaping and speed throttling techniques that are currently being employed by some BDUs that provide Internet access services. FRIENDS considers the network neutrality issue a critical aspect of a new media broadcasting review. If technological gatekeepers are allowed to determine which content takes priority, or is allowed access at all, freedom of speech and the public space will be significantly diminished.
As the Commission is well aware, there is a high degree of ownership concentration in the BDU sector, and a high percentage of the overall ISP market is also controlled by these same BDUs either directly at the retail level, or at the wholesale level.
Recently BDUs have introduced a supplementary bandwidth charge, no doubt in anticipation of the much greater viewing of video content that will take place in the future. The BDUs' argument seems based on the not unreasonable logic that fees charged should be based on bandwidth used. We note, however, that a similar logic does not seem to apply when it comes to compensating local over-the-air channels whose services are carried at a profit to the BDU without compensation.
More important, BDUs engage in several business segments which are highly competitive and should not be permitted to misuse their dominant position as distributors to engage in anti-competitive behaviour. As we have previously stated, BDUs endorse 'market forces' because they ARE the market force – a principle that became abundantly clear towards the end of the BDU/Specialty hearing.
The following is one of the comments posted on the Commission's E-consultation site from a writer identified only as 'leithal'. That writer, in our view, summarized the issue of net neutrality and its relevance to new media broadcasting succinctly:
"I think that if major ISPs such as Rogers and the various Bells are not regulated, they will engage is monopolistic and uncompetitive practices.FRIENDS looks forward to participating in future aspects of this important public process.
"We need to guard our bandwidth rights and our privacy from these providers.
"First, if an ISP sells you a maximum download speed and a maximum bandwidth allowance, then they should not limit your download speed or volumes unless and until you exceed that allowance, regardless of the packet type, source or content.
"This means that the current throttling practices based on bit torrent packets and/or encrypted packets should be illegal. Not only are there legal and legitimate uses of this technology; no one appointed or agreed to such limitations.
"Second, this is especially true if the ISP is in a conflict of interest with other Internet content providers. If an ISP opts to provide content (say video on demand) and they are permitted to throttle traffic – they could and likely will attempt to limit downloads from competitive services (such as iTunes, NetFlix or similar services).
"Third, it should be illegal for an ISP to perform any deep-packet-inspection. Internet service providers should do that provide services and access to the Internet. They should not regulate, throttle or monitor the type, source and/or destination of my Internet traffic.
"They should not be able to limit how many or what type of traffic my systems can send or receive. Already both Rogers and Sympatico are blocking some ports (notably smtp server ports) and limiting access to third party mail servers – such port blocking should be illegal.
"Also, standard criminal rules should be applied to prevent them from probing, scanning or attempting to determine what if any "services" my systems are running. Any Terms of Service that are worded to permit what otherwise would be illegal access to my systems should be declared illegal and void.
"Currently the providers arbitrarily and without recourse modify their Terms of Service to permit them to limit access. Blocking one port seems like a small issue, but one port is only the beginning of what they will do, if they remain unchecked."
Yours sincerely,
Ian Morrison
Spokesperson
For information: Jim Thompson 613 567 9592
