Sunday, February 24, 2008
Junk statistics lead to junk policy
The Ottawa Business Journal reported that a Harris Decima poll shows overwhelming support among Canadians for requiring Internet and wireless service providers to help finance production of Canadian digital media content.Of course people would say that.
Until they stop to think about what it really means for ISPs and WSPs to provide financing for content.
Alan Goluboff, President of the Directors Guild of Canada is quoted in the press release saying:
ISPs and WSPs are as much 'distributors' of information and entertainment content as cable and satellite TV providers. They should be required to help fund Canadian digital media content in the same way that cable and satellite companies are required to financially support Canadian television programming. These companies are immensely successful and have ample resources to support the creation of Canadian content for new media.The study was funded by the actors' union (ACTRA), film producers (CFTPA), the directors guild, and writers guild (WGC).
Who do you think would actually foot the bill? Would it be the shareholders of the "immensely" successful companies or their consumers who pay the Canadian content surcharge?
I'm going to guess that if Canadians were asked "would you be willing to pay more for your internet and wireless service so that producers of Canadian content don't have to produce economically viable content" the results of the poll would be somewhat different.
This smells a lot like a pitch for a hidden (or not so hidden) tax.
We know that Canadians think that wireless and internet service prices are too high as they are. Do we really need or want a new Content Access Fee added to our bills?
Let's go back to the underlying premise itself.
Why don't the Canadian content producers believe they can produce content that would attract advertisers or direct subscribers? Why are we starting with a presumption of a subsidy system to fund production of new media content?
What's next? Preferential treatment of Canadian content on ISP networks?
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Harris Decima, Canadian content, wireless, internet
Posted by Mark Goldberg @ 2/24/2008 10:08:00 AM 
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Good posting Mark. This seems to be the season for hidden (or not so hidden) taxes.
As if the idea of having ISPs and WSPs contribute to a fund to support the production of new digital media content wasn’t bad enough, the CRTC is currently considering a proposal that’s equally ridiculous. Canadian conventional TV stations have asked the CRTC to make cable and satellite companies pay monthly subscriber fees that carry and distribute their signals (many of which are local signals readily available over-the-air cases). This despite the fact that cable and satellite companies MUST carry their signals. This fee-for-carriage would ultimately be passed on to subscribers who and would be another hidden (or not so hidden) tax.
The broadcasters justify their proposal by pointing to the competition they face from specialty channels, many of which they own. In addition, there is no “must carry” when it comes to specialty channels. They have to negotiate both their distribution on cable and satellite TV systems and the compensation they must pay the cable operator to carry their signal. On top of this, the broadcasters are already being subsidized through the simultaneous substitution of programming and preferential treatment on the dial.
A representative of Quebecor’s TVA network is quoted as saying that all the broadcasters want is a "free market negotiation environment that lets the consumer decide what is valuable and what is not". This is simply specious and ridiculous. Unlike the carriage of specialty channels, there is no negotiation when it comes to the carriage of conventional Canadian TV stations and consumers’ estimation of the value of these stations doesn’t have any role in this whatsoever.
To me, all of this makes the arguments for a fee-for-carriage of Canadian TV signals less than compelling and reveals the proposal for what it really is, a money grab by the broadcasters that cable and satellite TV subscribers will end up paying. ‘Fee-for-carriage’ for conventional TV stations is going to result in higher monthly subscriber fees. The key question for these subscribers and the CRTC is what net benefit, if any, are they going to enjoy from the increase. The answer is none.
Seems to me there was a bit of a disturbance in Boston some time ago when people had taxes imposed on them without their having a say in the matter. Anyone up for a tea party in Hull one of these days?
As if the idea of having ISPs and WSPs contribute to a fund to support the production of new digital media content wasn’t bad enough, the CRTC is currently considering a proposal that’s equally ridiculous. Canadian conventional TV stations have asked the CRTC to make cable and satellite companies pay monthly subscriber fees that carry and distribute their signals (many of which are local signals readily available over-the-air cases). This despite the fact that cable and satellite companies MUST carry their signals. This fee-for-carriage would ultimately be passed on to subscribers who and would be another hidden (or not so hidden) tax.
The broadcasters justify their proposal by pointing to the competition they face from specialty channels, many of which they own. In addition, there is no “must carry” when it comes to specialty channels. They have to negotiate both their distribution on cable and satellite TV systems and the compensation they must pay the cable operator to carry their signal. On top of this, the broadcasters are already being subsidized through the simultaneous substitution of programming and preferential treatment on the dial.
A representative of Quebecor’s TVA network is quoted as saying that all the broadcasters want is a "free market negotiation environment that lets the consumer decide what is valuable and what is not". This is simply specious and ridiculous. Unlike the carriage of specialty channels, there is no negotiation when it comes to the carriage of conventional Canadian TV stations and consumers’ estimation of the value of these stations doesn’t have any role in this whatsoever.
To me, all of this makes the arguments for a fee-for-carriage of Canadian TV signals less than compelling and reveals the proposal for what it really is, a money grab by the broadcasters that cable and satellite TV subscribers will end up paying. ‘Fee-for-carriage’ for conventional TV stations is going to result in higher monthly subscriber fees. The key question for these subscribers and the CRTC is what net benefit, if any, are they going to enjoy from the increase. The answer is none.
Seems to me there was a bit of a disturbance in Boston some time ago when people had taxes imposed on them without their having a say in the matter. Anyone up for a tea party in Hull one of these days?
Posted by 
: 6:23 PM, February 24, 2008
: 6:23 PM, February 24, 2008
Mark, the proponents of this latest tax miss the boat when it comes to their analogies. ISPs generally do not distribute content in a manner analogous to cable or satellite distribution. We do not charge consumers for ITunes or similar content services that reside in the internet cloud. Rather consumers have a direct relationship online to the content providers without ISPs playing an intermediary roll or charging a fee for content.In effect the ISP acts as a common carrier and is regulated under the Telecommunications Act as such. I am unaware of any legal authority the CRTC would have to tax a telecom service to meet its obligations under the Broadcasting Act.
The more interesting debate will be whether The CRTC can or should regulate or promote geo-blocking of online content providers, including non-canadian providers like Apple,Yahoo or Joost. Stay tuned,these issues are currently being considered and a proceeding is expected this Fall. Now that's something that the net neutrality advocates should be really nervous about.
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The more interesting debate will be whether The CRTC can or should regulate or promote geo-blocking of online content providers, including non-canadian providers like Apple,Yahoo or Joost. Stay tuned,these issues are currently being considered and a proceeding is expected this Fall. Now that's something that the net neutrality advocates should be really nervous about.
Posted by : 10:02 AM, February 25, 2008
: 10:02 AM, February 25, 2008 << Home
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