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Netflix Rejects Canadian Regulator Jurisdiction Over Online Video
An anonymous reader writes "Last week's very
public fight between the CRTC and Netflix escalated on Monday
as Netflix refused to comply with Commission's order to supply
certain confidential information including subscriber numbers and
expenditures on Canadian children's content. While the disclosure
concerns revolve around the confidentiality of the data, the far
bigger issue is now whether the CRTC has the legal authority to
order it to do anything at all. Michael Geist reports
that Netflix and Google are ready to challenge it in a case that
could head to the Supreme Court of Canada.
"Can anyone seriously argue that Netflix isn't also rebroadcasting TV content?"
Yes, easily. Netflix has purchased licenses for it's content.
When it's American broadcasters going after Canada's icravetv, American courts had no problem getting a US court order that basically ended the service, because it was a rebroadcaster.
Can anyone seriously argue that Netflix isn't also rebroadcasting TV content?
Two weights, two measures. What a mess! And really, whatever solution will be a mess.
The difference is that NetFlix gets permission for rebroadcasting -- they have a license. That's why they don't have the same selection that other rebroadcasters do -- because they're licensing content on a show-by-show basis, not taking the OTA stream and routing it over the Internet.
This case is kind of unfortunate, as both the CRTC and Netflix are in the wrong, and both sides are unwilling to back down and come to a reasonable compromise, as that would threaten their power base.
The problem here is that the CRTC can stop all payment via Canadian credit cards to Netflix, and Netflix can support customers paying via alternate methods who are willing to stream over a VPN -- so the result of this conflict is that both sides lose, and the citizen (not consumer, although them too) loses even more.
But this whole thing is really about Rogers and Shaw lobbying the CRTC to block foreign competition for their new Shome project. CRTC is probably quite happy to be flexing their "muscle" in this situation after continually taking a beating from US lobbying interests on allowing US content onto Canadian networks.
So yeah; it's a huge mess to sort out.
Actually, unless you've read some additional Broadcast Act related law that I haven't, the CRTC can do no such thing. Netflix is not a broadcaster per the act and has no authority to ask for that information nor any statutory authority to affect Netflix in any way.
Then every website in Canada would require a license because it's broadcasting. The fact that it's video makes no difference. The CRTC has no business on the internet unless it's someone capturing a broadcast signal and streaming it. Even then I would say it is a copyright issue.
DRM? No thanks, I'll just get it somewhere else...
That's the real reason.
You may not realize it, but about 5 years ago (it was illegal since 2002, but many companies appealed), the Supreme Court of Canada ruled that it was illegal for Canadians to view US TV via US "grey market" satellite receivers.
No, these were not people hacking DirecTV or Dish receivers to receive content for free. They were normal Canadians who were paying DirecTV and Dish their normal rates to get US TV. It was ruled illegal for companies to provide any sort of service to enable them to do this. (It's called grey market because to Dish or DirecTV, it's a normal subscriber paying full freight on their subscription, except they were receiving it in Canada).
The culprit? Bell.
So yeah, it's a bit bull-headed of Netflix - all the CRTC wants is to have numbers behind Netflix's claim that they provide tons of Canadian support. (That's what Netflix was claiming - that they already fulfil the rules they don't have to follow, and the CRTC basically says "prove it - show me the numbers").
In the end, it's going to be one big nasty fight. Sure, Netflix is worried because those numbers that prove its point are highly sensitive competitive information, but you'd think they could compromise in that Netflix could find a way to give the CRTC what they want without giving it to competitors. But it's better than the alternative which forced an entire industry to shut down.
A remarkably neutral document was compiled out of this - http://www.parl.gc.ca/HousePub...
That's a very US centric view. We as Canadians have a different approach to government and how we want to build our society. We're more like european countries with Free School for all, Free Healthcare for all, lots of social services and support for our vulnerable population. The term "free enterprise" is not something I think I've heard *once* in my life from a politician here. We frankly don't make a big deal about the "sacred invisible hand of the market".
An aspect of this, is the government spending a LOT of money developing artists, book/movie production houses, etc. This conflict between Netflix and the CRTC is tied to that. Other broadcaster have to chip money into the pot for, yes, our socialist approach to fostering local arts. Many Canadians *support* this idea and we're not too fond of an American company trying to wreck the system of local content production.
Former and current employees of Bell and Rogers, members of their former lobbyist groups, and lawyers and other "VIPs" who have strong ties to Rogers and Bell. They're about as neutral on this matter as PM Harper is about his evangelical religious ties. Not very. The CRTC is looking out only for the entrenched players in this market, not consumers. Just yesterday a report came out that once again showed that Canada pays more than any other developed country except Australia for it's wireless phone pricing. The CRTC ignores this fact. Bell and Rogers are the incumbents and don't want anything changed. hell, Rogers has testified in front of the CRTC that wireless rates could be much lower here ... they just don't want to (obviously). And when competition threatens? They twist the CRTC's arm and they are safe again. The CRTC needs too be abolished and we need some real competition up here. The fact that Rogers and Bell so easily control the CRTC and the CRTC just bends over for them and it's decisions is disgusting.
DaveyJJ
That's just it. They are YOUR laws and your sovereignty, not Netflix's. YOU are crossing the digital border into the United States as Netflix doesn't appear to maintain a physical presence in Canada. Don't like it? Tough. You'd have the same response if the US tried to enforce it's laws and sovereignty on something that was wholly Canadian but possible to be consumed in the United States.
Except as everyone is noting here, they are NOT broadcasting. They are an on-demand service. Percentage of Canadian content can't apply when your customers pick and choose what they want to see. The CRTC has no jurisdiction here - Netflix isn't radio, television, and it's barely 'telecommunication'. Interesting too that it's being squeezed by the government right after the major carriers announced their own on-demand service... protectionism? Definately.
You probably mean the Broadcasting Act, which establishes its subject-matter jurisdiction as follows:
âoebroadcastingâ
 radiodiffusion Â
âoebroadcastingâ means any transmission of programs, whether or not encrypted, by radio waves or other means of telecommunication for reception by the public by means of broadcasting receiving apparatus, but does not include any such transmission of programs that is made solely for performance or display in a public place;
âoeprogramâ
 émission Â
âoeprogramâ means sounds or visual images, or a combination of sounds and visual images, that are intended to inform, enlighten or entertain, but does not include visual images, whether or not combined with sounds, that consist predominantly of alphanumeric text;
4. (1) This Act is binding on Her Majesty in right of Canada or a province.
Application generally
(2) This Act applies in respect of broadcasting undertakings carried on in whole or in part within Canada or on board
(a) any ship, vessel or aircraft that is
(i) registered or licensed under an Act of Parliament, or
(ii) owned by, or under the direction or control of, Her Majesty in right of Canada or a province;
(b) any spacecraft that is under the direction or control of
(i) Her Majesty in right of Canada or a province,
(ii) a citizen or resident of Canada, or
(iii) a corporation incorporated or resident in Canada; or
(c) any platform, rig, structure or formation that is affixed or attached to land situated in the continental shelf of Canada.
For greater certainty
(3) For greater certainty, this Act applies in respect of broadcasting undertakings whether or not they are carried on for profit or as part of, or in connection with, any other undertaking or activity.
Idem
(4) For greater certainty, this Act does not apply to any telecommunications common carrier, as defined in the Telecommunications Act, when acting solely in that capacity.
1991, c. 11, s. 4; 1993, c. 38, s. 82; 1996, c. 31, s. 57.
> So...as an American can we borrow a few of your ideas?
What do you mean? American already did ...
* First Electric Light Bulb
* Basketball
* Heart Pacemaker
* JAVA
* Garbage Bags
* Radio Broadcast
* Portable Walkie Talkie
* Insulin Process
* Newspaper
* Kerosene
* Wondebra
* Odometer
References:
* http://www.dealathons.com/blog...
* http://mentalfloss.com/article...
Why does Netflix get shit over this? The people that own the content Netflix sells (Hollywood) will not stream it without DRM. People on Linux wanted Netflix. This was the only reasonable solution.
Their other options were:
1. switch to another closed format from Adobe or similar
2. Stay on Silverlight and tell Linux users to piss off.
3. Remove DRM completely, and abandon all streaming outside of their own self-created content and a bunch of independent moves that few people would pay to see, since they're likely already available for free.
Either tell me which one you would choose as the owner of Netflix, explain what one I'm missing, or STFU.
Grammer Nazis - I mod you "troll" unless you actually add something on-topic. Yes, I know I have mispellings in my sig.
After years of watching the mess that is the CRTC, I have come to the conclusion that if they don't like it then I probably should.
Someone might want to inform the CRTC bureaucrats of the consequences of pissing off at least 4-million voters — election of the party that promises to rid us of the CRTC. (Really, this would be about 25% of the electorate assuming that each Canadian Netflix account corresponds to a household with 1.6 voters.)
Gouge us, go to war, waste tens of billions of dollars, the public doesn't care. But cut off our entertainment — it's torches-and-pitchforks time!
Ask Canadian TV broadcasters that question, who insist on verifying that you are a Canadian cable TV subscriber before they will let you watch their shows online. I suspect that Netflix may be expected to adopt the same behavior, or else not be permitted to show TV shows in Canada which may also happen to be aired on a Canadian network, regardless of where the show was made.
File under 'M' for 'Manic ranting'
"Fuck the NSA" is far too gentle. As an actual patriotic American, my stance would be "nuke the entire site from orbit. It's the only way to be sure."
This is my signature. There are many like it, but this one is mine.
Yes and we see what free education did for your math skills ... ~62% overall taxation rate since sales tax is only effectively levied on the remaining money after paying income tax. .52 + ((1-.52)*.21) = .62
On a larger scale, the US wants to be a faux socialist democratic country. In reality we just tax the people and companies who can't afford to avoid paying taxes. Wonderful example - Steve Jobs' wife didn't have to pay income tax on the $billions in stock grants her husband earned during his tenure at apple. Lovely eh?
You can get rich if you own a politician, but you have to be rich to buy one in the first place.
We as Canadians have a different approach to government and how we want to build our society.
Yes, but not all Canadians buy into the CRTC's approach. I am absolutely opposed to all the CanCon and related regulations imposed by the CRTC. I'm completely fine with the federal and provincial governments subsidizing broadcasters and the arts in general (TVO is a great example of this done well), but I'm utterly opposed to their regulating what private broadcasters have to show.
we're not too fond of an American company trying to wreck the system of local content production.
Speak for yourself. I'm fine with anyone wrecking the Canadian content production system. 90% of content producers will go under because they produce content no-one cares about. The 10% that survive will do so because they produce really good content and are competitive. Ultimately, it will lead to a healthier content-production industry that's not dependent on protectionist measures for its survival. Maybe we'll even be able to open up an export market for Canadian content.
Yes, Netflix does not fit that definition of a broadcaster as clarified by the CRTC themselves in 1999:
“Among the services that also do not fall within the scope of the definition of broadcasting are those where the potential for user customization is significant, i.e., services where end-users have an individual, or one-on-one, experience and where they create their own uniquely tailored content. The Commission considers that these types of services do not involve the transmission of programs for reception by the public and are, therefore, not broadcasting.”
http://www.crtc.gc.ca/eng/archive/1999/pb99-84.htm
My opinion is that there would have been a benefit in having those directly responsible suffer the most
I agree, but it is unlikely that Clinton, Dodd, Frank, Waters, Obama, or any of the others who pushed the Community Reinvestment Act, community activism, and forced banks to make bad loans to people who couldn't pay them back would ever be punished at all, much less "suffer the most".
"Architects of Ruin" by Peter Schweizer is a pretty good eye-opening read regarding the entire history that led up to the bubble bursting. It wasn't an isolated event that happened overnight, it took many years to develop. The short story is, if you force banks to make bad loans then that debt has to go somewhere. If you don't think the CRA etc forced banks to make those loans, then you don't know the history.
requiring higher capital requirements, more diligent use of mark-to-market, risk analysis and so on.
But having any effective risk analysis would have meant that the banks wouldn't make loans to people who couldn't afford them, and that failure to make loans to such people was the reason for the regulations that were in place forcing them to make those loans. The buzzword was "redlining", and the solution was "community reinvestment", aka The Community Reinvestment Act. If the banks were complaining, it was because they were forced to make risky loans in the first place and then prevented from recapitalizing by selling those loans. A bank only has so much money, and if all the money is in the hands of people who cannot or will not pay it back the bank goes out of business.
If you think it makes sense to force banks to hand money out to people who use welfare checks or "sweat equity" as proof of income so they can buy houses they can never pay off, and then let the banks run out of money to do that because they can't sell the loans off, you're a part of the problem, not the solution.
but there is a direct line between the bailouts and the lack of regulations.
There is a direct line between the over-regulation, repeated previous bailouts, and the final big one. Had banks been allowed to continue their proper risk evaluation for loans the collapse would not have happened. Over-regulation and the threat of lawsuits from activist groups like Jackson's PUSH or ACORN forced the bad loans to be created.
Exactly, as the CRTC themselves decided in 1999
From: http://www.crtc.gc.ca/eng/arch...
45. The Commission considers, however, that some Internet services involve a high degree of "customizable" content. This allows end-users to have an individual one-on-one experience through the creation of their own uniquely tailored content. In the Commission's view, this content, created by the end-user, would not be transmitted for reception by the public. The Commission therefore considers that content that is "customizable" to a significant degree does not properly fall within the definition of "broadcasting" set out in the Broadcasting Act.
51. Accordingly, the Commission will issue a proposed exemption order without terms or conditions in respect of all undertakings that are providing broadcasting services over the Internet, in whole or in part, in Canada.
The CRTC is just posturing.
My guess is that you are completely wrong. Most of us are completely confused as to how spending tax dollars to subsidize TV shows and movies that nobody watches actually helps Canadian culture.
If you think Canadian culture is so fragile that it cannot survive without the protection of the CRTC, they you really don't think much of Canadians.
It's a healthier state than the current one: "laughingstock".
I'm all in favor of free health care, free education, and social assistance for those who require it. I find the idea of a socialized entertainment industry a ludicrous and disgraceful waste of tax dollars.
If Lost Girl is something you subsidize, please increase your taxes. Or Continuum.
Almost as good as the New Zealand show This is not my life.
Don't fight for your country, if your country does not fight for you.