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Statement from PIAC regarding OTT services in CRTC’s TalkTV CanCon decision

PIAC-CAC are skeptical that today’s CRTC’s TalkTV CanCon decision will have the effect of motivating Bell, and Rogers and Shaw, to make their content available online to every Canadian as a true “over-the-top” service instead of requiring Canadians to (a) buy a BDU subscription (Bell’s Crave) or (b) or an internet or BDU subscription (Rogers or Shaw’s Shomi).

PIAC-CAC challenged that tied selling as basically arbitraging different sets of rules to favour themselves in a way that harms competition and consumer choice at a time when Canadians want more and more control over what they watch, and how they watch it.  (PIAC-CAC had characterized Shomi as “a subscription-based online streaming service tied to a specific ISP or BDU service or class of BDU services“, and CraveTV as a “a subscription-based online streaming service tied to a class of BDU services.”)

The Commission acknowledged in its broader TV framework decision today that it may not be clear what rules apply to these types of services, which is something PIAC-CAC’s applications intended to elicit and ultimately resolve. While the CRTC, in a separate letter, “returned” PIAC-CAC’s complaints, i.e., avoided providing a ruling, PIAC-CAC believe their complaints have highlighted ongoing and growing tensions between the old TV distribution models and new ones, and tensions between the two statutes governing broadcasting (TV) and telecom (internet) in Canada.

The Commission’s proposed approach to this in today’s decision appears to be to have three categories of video-on-demand services that TV providers can adopt – the traditional one accessed through with a BDU subscription, the licence-exempt “over-the-top” service (accessible via any internet connection), and a third, new “hybrid” model which allows BDUs to offer the service exclusively to only their BDU customers so long as the service is also available to anyone with an internet connection (thus providing a competitive differentiator to the BDU service).

What today’s decision does not do is declare that Bell, Rogers and Shaw are such “hybrids”, and therefore it appears that the Commission will allow the closed, tied model to continue. The CRTC appears to be trying to provide an incentive to become a hybrid VOD – if you do that, you don’t have to abide by the traditional licensing requirements (namely CanCon financial obligations). It’s a way to lighten the financial burden on those services in exchange for a requirement to make it available online.

Although the Commission’s emphasis in this particular decision is on helping VOD services compete on an “equal footing” with online video services, PIAC-CAC believe that online video services, particularly small competitors, are the ones that face a structural disadvantage against the large, vertically integrated companies (owning both broadcasting content and internet access services) implicated in today’s decision. In PIAC-CAC’s view, that disadvantage harms competition and consumer choice. PIAC-CAC are therefore considering whether to bring fresh applications, as the CRTC suggested they could in light of these decisions. PIAC-CAC also encourage Canadians to share their views on these matters by emailing piac@piac.ca, and by tweeting #Canadians4OTT.

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