CRTC cuts off Internet TV firms from cheap programs

The Canadian Radio-television Commission has issued a report that exempts Internet TV retransmitters from its licences, preventing them from access to cheap programming.

The report upholds

a 1999 New Media Exemption Order, which essentially states that the Internet does not fall under the purview of the CRTC. The exemption also prevents Web sites that broadcast TV signals, like, from benefiting from copyright tariffs. If they could pay these tariffs, like television stations licensed by the CRTC, they wouldn’t have to make individual deals with TV copyright holders.

In preparation for its report, the CRTC consulted with 40 industry associations and professionals. including the Canadian Association of Broadcasters.

“”We are very happy with that decision. We think that is the right decision for the industry, from a regulatory and a copyright standpoint,”” said CAB general counsel Erica Redler. “”We think it’s completely consistent with what Parliament was trying to do with passing Bill C-11. Had they done anything else, they would have essentially gutted the bill.””

Bill C-11 explicitly excludes third-party Internet retransmitters from the compulsory licence regime embodied in section 31 of the Copyright Act.

According to Redler, the report is less about CRTC licensing than it is about access to a copyright licence, which would revolutionize the way Internet retransmitters do business. “”Cable has it, satellite has it, because it means that (they) can take the broadcast signals without asking us, contingent on just paying a tariff free. It’s very valuable, because it gives you piles of content at a very cheap price.””

TV on the Internet has a spotty record. Retransmitter went out of business not long after it set up shop in 1999. It offered streaming media featuring both American and Canadian TV content and was subsequently sued by numerous television companies.

Montreal-based is still operating, but only by negotiating contracts with individual signal providers — some of which are members of the CAB, said Redler. JumpTV was part of the CRTC’s 40-member panel, but did not return calls for comment at press time.

Without access to retransmission tariffs it will be difficult for such sites to continue operation, argues Jay Thomson, president of the Canadian Association of Internet Providers. The good news, said Thomson, is that the CRTC won’t be involved in regulating the Internet. The bad news, however, is “”in following this route, they may have very well prevented any opportunity for Internet retransmitters from launching the service. . . . Absent a retransmission tariff, I don’t know how a retransmitter can actually operate.”” is quoted in the report as saying there is the possibility of a time “”when the Internet will replace cable systems as the single method of distribution of television, radio and other content, becoming the sole medium of transmission of digital works.””

The CRTC’s response was Internet retransmission will not replace over-the-air broadcasting until it can achieve the same quality and quantity of programming and do it more cheaply.

According to Redler, the CAB’s position is: “”We’re not against technology, we’re not against technology on the Internet at some point in time, including right now. What we did not want is the ability of Internet companies to take broadcast signals without asking the broadcast companies or the producers.””

Another report consultant, the National Film Board of Canada, said that Internet broadcast is in the public interest, provided the rights of the copyright holders and artists and protected. In the report, they stated that Internet retransmitters should be able to pursue subscription models and on-site advertising. To offset any potential losses, conventional TV broadcasters could offer their own Internet broadcasts, the NFB argued.

The NFB has its own video on demand service called Cineroute. “”The NFB does not have its own broadcast channel, so as long as we can protect the artists’ rights and (those) of the broadcast rights holders, we believe that it may eventually be an interesting and viable way of disseminating a very, very large film library,”” said Laurie Jones, director of general communications and network development.

In upholding its 1999 decision, the CRTC has maintained “”the status quo”” said Redler. The CRTC’s view is that Internet retransmission does not currently have “”a material impact”” on conventional TV. For it to do so, “”the Commission considers that certain benchmarks in the development of Internet retransmission would first have to be reached.””

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