Banff: CRTC to Rewrite Canadian TV Rule Book for Digital Age

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The industry watchdog could reconsider whether to regulate Netflix Canada, forcing the U.S. online streaming giant to help finance local content.

BANFF, ALBERTA – The CRTC could reconsider whether to force Netflix Canada to help finance local TV shows when Canada’s TV regulator rewrites the industry’s rule book at upcoming hearings.

CRTC chair Jean-Pierre Blais told the Banff World Media Festival that the regulator will review a fast-changing Canadian TV industry with an eye to continuing deregulation for a digital age.

“While the intentions have always been good and appropriate for the times, the result is a complex framework,” Blais said of the current regulatory regime here.

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“There’s nothing to be gained by regulating for regulations’ sake,” he added.

At the same time, there were instances, as with the regulator's initial decision to deny BCE's $3.2 billion takeover of Astral Media before getting set to rule on a second application, where the CRTC was willing to take a hard line to protect consumer interests.

A key issue likely to come up during a planned public and industry consultation in fall 2013 is whether to regulate Netflix Canada.

The CRTC decided on two earlier occasions not to compel the U.S. video streaming giant and other foreign digital platforms to subsidize homegrown Canadian TV series when operating here.

The regulator instead chose to remain on the sidelines and let the market sort itself out.

But domestic broadcasters and cable operators are expected to tell the CRTC during the upcoming hearings that Netflix Canada, which has 2 million subscribers, should be required to help fund Canadian TV and digital content.

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That’s in contrast to regulated Canadian TV services that have content expenditure obligations as part of their broadcast licenses.

Blais told his Banff audience that, while industry rules needed to be updated for the digital arena, “regulatory fiat is becoming an obsolete concept in a borderless world.”

He added that the CRTC needed to move from “protect to promote” in a Canadian market where industry players have long depended on heavy-handed protectionism to compete with U.S. studios and networks in business south of the border.