Canadian Regulator Threatens To Impose New Netflix Regulation

An anonymous reader writes: Netflix appeared before the Canadian broadcast regulator today, resulting in a remarkably heated exchange, with threats of new regulation. The discussion was very hostile — the CRTC repeatedly ordered Netflix to provide subscriber information and other confidential data. As tempers frayed, the Canadian regulator expressed disappointment over the responses from a company that it said "takes hundreds of millions of dollars out of Canada." The CRTC implicitly threatened to regulate the company by taking away its ability to rely on the new media exception if it did not cooperate with its orders.

Comments

why does the CRTC need this list?

[ganjadude]

why does anyone other than netflix need to know who their customers are?

Re:why does the CRTC need this list?

[Anonymous Coward]

The CRTC is in the pockets of companies that don't like netflix, aka cable companies.

Re:why does the CRTC need this list?

[i kan reed]

To clarify, in this case they claim that netflix doesn't do enough to encourage the production and consumption of Canadian entertainment, a requirement they place on other distributors.

So they're, in theory, doing exactly what you say, just in less harsh terms. They want to ensure the continued interest of Canadian producers, and not American.

And they're using arbitrary leverage like demanding subscriber lists to push netflix to obey. It's not neat or nice. But they're kinda being upfront that it's just leverage not genuine interest in the records.

Re:why does the CRTC need this list?

[Tailhook]

Tax subscribers. Obviously. The funds will be pissed away giving Canadian cable executives better bonuses

Is Canada still taxing blank media to subsidize the "victims" of "piracy?"

Whatever. Enjoy your cable monopoly Canuckistan. You deserve it. As do we.

Re:why does the CRTC need this list?

[JMJimmy]

Check the facts before making snap judgements. This article is blatantly misleading to the events that actually occurred. Here's the actual video from the hearing:

https://www.youtube.com/watch?...

Summary: Commission is seeking information to make a decision - even in its conversation with Netflix they state they are not leaning in any direction (regulation or deregulation). The commission requested information, Netflix rep refused to commit to provide it. This pissed off the head of the CRTC because Netflix doesn't have a choice - by operating in Canada they must provide the information. The CRTC repeatedly had to make it an order for Netflix to provide the information it was requesting to backup assertions made by Netflix to the commission with actual facts/data.

Re: why does the CRTC need this list?

[NeutronCowboy]

Wow. Every regulatory agency is just there to expand its own powers? They do nothing else?

The reason people point you at Somalia is because your hyperbole leads you directly there. Want to have a civilized discussion about the optImal size of government? Great, start by dropping the ridiculous hyperbole.

Re:why does the CRTC need this list?

[lucm]

No it's not. That's quite the opposite: most cable companies would like to see the CRTC go away because it forces those who have specialized channels (basically every single profitable cable company) to contribute to a big pool of money that public services can tap into to subsidize their ad-free programming (which directly competes with private cable companies) and to pay for content that nobody cares about and that will never make money (a la CSPAN or PBS).

The truth is that the CRTC is mostly a symbolic agency with very little power. They report to the Minister of Canadian Heritage, which has maybe 3 employees and 2 interns. They don't control the frequencies or anything like that.

Re:why does the CRTC need this list?

[Dixie_Flatline]

I'm not sure if anyone commenting on this story is actually Canadian, but the Canadian Content mandate has existed for years. It's not about favouring Canadian production companies so much as encouraging Canadian content for cultural reasons. Being so close to the USA leaves us vulnerable to sort of being swamped, culturally.

Radio stations are required to play a certain amount of Canadian music as well. It's not really anything new.

Personally, I like the idea of that. It encourages and funds a lot of Canadian artists that might otherwise get swamped out of the market by monied American interests.

Re:why does the CRTC need this list?

[JMJimmy]

Except Netflix is **not** a Canadian company.

Your point? ABC/NBC/Fox/etc are not Canadian companies, they still have to comply with CanCon rules within Canada. Netflix is operating under an exemption from those rules right now.

Re:why does the CRTC need this list?

[oh_my_080980980]

What!?! Citation needed. Yes you need a physical presence. International law has not changed. Good luck dragging Netflix into a Canadian court of law.

Re:why does the CRTC need this list?

[pslytely psycho]

No it doesn't.
Canada blows, Mexico sucks.
That's why the prevailing winds in North America are north to south......

Re:why does the CRTC need this list?

[kristianbrigman]

Except.... cable companies program what they are going to play. Netflix plays what their subscribers want to see. What are they supposed to do, put up a notice saying 'You can't watch the next episode of "Under the Dome" until you first watch your quota of 3 of these other Canadian shows?' The rules don't even make sense for the Netflix model.

Re:why does the CRTC need this list?

[i kan reed]

Netflix plays what their subscribers want to see

Then why do they have so many reality TV shows? Ugh.

No, but really, the set of inputs to what Netflix has is quite complicated. They love things with cheap per showing licenses, like off-the-air TV shows, unpopular movies, documentaries where the producers are more interested in pushing a message than making a profit, and a smattering of more popular "draw" shows/movies to bring in the popular audience.

And then there's the loss-leader shows trying to get people to start watching the series as it comes out, either on pay services or with commercials.

And then there's the various "taste profiles" of the people who are netflix subscribers, and what's both cheap and good within that frame.

There's some pitiable accountants in the company who's responsible for balancing all those factors, while making a profit.

Reducing all that to "giving the people what they want" is a little unpragmatic.

Re:why does the CRTC need this list?

[Mashiki]

You've got no idea of what you're talking about. The biggest reach that politicians have on this is being able to threaten to take their mandate away on broadcast regulatory issues. And it has nothing to do with libertarianism, this is due to excessive regulation not too little. And why is this happening? Because the CRTC is packed with suits from the major telcos, cableco's, and industry insiders. I'm sure someone will scream "lulz harper" but I'll point out now that this is how it has been since the CRTC got started.

The CRTC mandates: internet, pricing controls for the internet, third party pricing controls for the internet, cancon, who can or can't have a broadcast license, telephone, telephone quality, and several other things. Industry Canada on the other hand their biggest reach is spectrum.

Re:why does the CRTC need this list?

[kristianbrigman]

That's not the point... i don't know the details, maybe it's more complicated than this, but as i understand it there are rules about playing X% of canadian content. for a radio station, this means that if there are 24 hours in a day, they may need to play e.g. 10 hours of canadian music and 14 hours of everything else (announcers, commercials, foreign music, etc). And you either listen to it, or don't, but you can guarantee a certain percentage of supply. If you watch or listen to any particular station for any length of time, you'll see or listen to some canadian content.

Netflix doesn't work like that... i say i want to watch X, Y, and Z. if those aren't canadian, what do they realistically want netflix to do? throttle me? pay a tax on every non-canadian item? force the catalog of choices to be X% canadian? ensure that some canadian content is shown (but that's usually based on my watching history... guess it would have to take some additional input)? none of those are really very similar to the content quotas on radio/TV, and are far less effective at promoting Canadian cultural content....

in general, culture is transitioning from a push model to a pull model. There's just not as much room for central control of any kind to meaningfully control it.

Re:why does the CRTC need this list?

[Mashiki]

Huh? The American networks as carried in Canada do not have 50% Canadian content in prime time. In fact, it's probably zero percent.

You're right, the only reason they don't is because the channels that are canadian get overwritten by the cableco/satellite provider when it's also broadcast on a US channel. So they get their "canadian content" that way. The only way to get a US channel in Canada that isn't simulcast is by OTA.

Re:why does the CRTC need this list?

[mark-t]

Is Canada still taxing blank media

Youu mean the blank media levy? Yes.

Which is particularly ironic now that Bill C-11 passed in 2011 (despite otherwise unanimous objection to it by all other parties, the Conservative government, controlling slightly more than 50% of the seats in the House of Commons, was able to finally push it through, which they had been trying to do repeatedly since 2006, and were only able to do so once they had a majority government), and which happens to make it illegal to bypass or break any kind of technological protection measures on copyrighted works, even for personal use, and considering the increased reliance of such measures in an only ever-increasingly digital era, this bill makes the levy on blank media, which was supposed to exist to subsidize for private copying only by the way (not piracy, as some people believe), an extra expense that Canadians are paying for and practically don't even have the right to legally enjoy (although the government has said they will not enforce the bill in matters for strictly private use, it would still apparently be technically illegal).

Did I mention that I really hate the Canadian Conservative government? I sure as hell didn't vote for them.

Re:why does the CRTC need this list?

[Minwee]

Is Canada still taxing blank media to subsidize the "victims" of "piracy?"

Yes. Is the USA still allowing copyright trolls to financially ruin people in ways that are not legal in Canada?

Enjoy that.

Re:why does the CRTC need this list?

[Minwee]

It just proves so called Canadian culture, art, music sucks and cannot stand on it own two feet. Canada would rather have American culture than its own shitty home grown crap.

Hell yeah! Why would they want to see Canadian movies when they could be watching films with good, ole AMERICAN actors like Dan Ackroyd, Raymond Burr, John Candy, Neve Campbell, Jim Carrey, Michael Cera, James Doohan, Nathan Fillion, Michael J. Fox, Matt Frewer, Lorne Greene, Corey Haim, Phil Hartman, Tricia Helfer, Michael Ironside, Margot Kidder, Eugene Levy, Eric McCormack, Norm McDonald, Rick Moranis, Carrie-Anne Moss, Mike Myers, Leslie Neilsen, Catherine O'Hara, Sandra Oh, Tahmoh Penikett, Christopher Plummer, Seth Rogen, William Shatner, Martin Short, Jewel Staite, Donald Sutherland... Heck, that's half the cast of almost every Comedy or SF film ever made.

All Canada has is Justin Bieber and Nickleback.

Re:why does the CRTC need this list?

[Minwee]

Why doesn't Canada just take justin beiber back, call it even?

Unless the USA restores him to the condition in which he was originally received, they're going to have to forfeit their damage deposit.

Re:why does the CRTC need this list?

[JMJimmy]

The law deals with "signals which carry sound and images" - it's not technology specific. That's why, years ago, they introduced the "digital exemption" for internet based services to allow them to grow/keep entry barriers low for new services. That exemption is granted (or revoked) a the CRTC's discretion and that's what this set of hearings is for - to figure out whether to regulate, deregulate, or maintain the status quo on both traditional broadcasters and new media.

In Canada corporations are not people, they do not have free speech rights.

Re:why does the CRTC need this list?

[Anonymous Coward]

The blank media levy isn't for victims of piracy; it makes it legal to copy music for private use in Canada.

Basically, Canadian recording companies constantly lobbied the government saying "People are copying our music. There's no other use for a blank cassette but to copy music. We want to be paid a little for all those blank cassettes, and then we'll make copying music legal." The Canadian government resisted for a while, but eventually caved in, and there was much rejoicing from the record execs.

And then a short while later Napster appeared on the scene, and suddenly all the record execs said "noooooooooo!" They suddenly started lobbying to remove their new bill. :P

Re:why does the CRTC need this list?

[Dragonslicer]

Ignoring the desires of 40% of the population is a wee bit undemocratic, wouldn't you agree?

Uh, no, if the other 60% desired otherwise, ignoring the desires of 40% of the population would, by definition, be completely democratic. That's why we don't have true democracies.

Re:Uh

[JMJimmy]

Canada is their 2nd most successful market.

Easy solution...

[Em Adespoton]

I've got a solution that will make everyone happy:
Have NetFlix partner with the NFB to distribute NFB content... globally. Nothing like providing global access to Canadian content. NetFlix could even provide it for free to everyone in Canada with an account but no current subscription. Under this setup, the CRTC wouldn't have a leg to stand on, as at that point, they will get their Canadian Content on NetFlix (not sure about the French/English ratio though).

HOWEVER

I'm pretty sure this really has nothing to do with NetFlix and EVERYTHING to do with the new consortium raising a Canadian NetFlix "competitor" (Shomi) whispering nasty things in the CRTC's ear. Yes, blame Rogers/Shaw for this fracas, as they're likely where the blame really lies.

Re:Fuck Canadian content welfare system

[JohnSearle]

Not that I necessarily agree with regulating content on Netflix; but there is a connection between media and opinions around ideologies, national unity, political awareness, amongst other topics. Being overwhelmed with cheap American content doesn't assist in educating Canadians about Canadian values and awarenesses. This is even more problematic when the viewers are still learning / developing their value systems (e.g. children).

I recall seeing some statistic that showed that an increasing number Canadians were more aware of the American political system then there own... a sad state of affairs that is due to an overwhelming amount of American media presence. It is this type of situation is what the CRTC is attempting to mitigate through regulation.

Yet Another Worthless Summary

[meustrus]

Netflix appeared before the Canadian broadcast regulator today, resulting in a remarkably heated exchange, with threats of new regulation. Blah blah blah, confidential data that CRTC may or may not have right to see but we won't tell you, blah blah blah, redundant stuff, blah blah, no more information, blah blah blah, click the link if you actually want to know what the fuck we're talking about, blah blah blah...

It's pretty much impossible to expect a reasonable discussion on Slashdot when the summary is such redundant tripe. After all, nobody around here RTFA. So all we have is basically, "Netflix and CRTC had a fight about something". I'm not Canadian, I don't know anything about the CRTC or why it has any regulatory authority over Netflix, or what these ominous-sounding "regulations" might be. And I doubt every Canadian could answer those questions either.

Although considering the article itself, maybe that's actually the best the summary could do. I learned more than the article had to say just by scrolling through the existing Slashdot comments to see if anybody else had already made the comment I'm making. These being Slashdot comments, however, I'm a little scared about the value of that information.