The CRTC has initiated a public proceeding
to allow interested parties to comment on the implications for the
Canadian broadcasting system of the increasing consumption of
Internet-delivered programming in Canada – but has urged
them to back up their assertions with any applicable data.
The "fact-finding exercise" follows pressure from
several sources to consider changes to the existing broadcasting
regulatory framework in light of increased competition from
unregulated over-the-top (OTT) program providers.
The Commission has requested submissions on the following
topics, as they relate to the potential impact of OTT services:
The capabilities of measurement and analytical tools to assess
Trends and predictions respecting consumer consumption of
programming, and the impact of the growth of OTT services on
Technological trends in consumer devices and network
Opportunities and challenges for the Canadian creative
The impact on the acquisition and exhibition of programming
available to Canadians
submissions and evidence respecting the potential contribution
of OTT services to the achievement of Canadian broadcasting
While the CRTC has previously found Internet
delivered programming to fall under its jurisdiction under the
Broadcasting Act, it has to date exempted such "new
media" undertakings from licensing, imposing only minimal conditions. The
Commission has consistently found, including as recently as 2009,
that no evidence existed to demonstrate that new media posed a
threat to the ability of traditional broadcasting undertakings to
meet their regulatory obligations. Moreover, the Commission
has found that it has not been established that regulating new
media undertakings would contribute in a material manner in
achieving Canadian broadcasting policy objectives.
However, in recent months, a number of interested stakeholders,
including broadcasters, broadcast distributors and the creative
sector expressed concern that unregulated foreign providers of OTT
programming are increasingly competing with licensed broadcasting
undertakings, negatively impacting subscription and advertising
revenues and the ability to acquire programming. These
parties argue that this trend is creating an unlevel playing field,
where traditional broadcasters and distributors have to meet a
range of regulatory requirements, including minimum Canadian
content requirements and substantial financial contributions to
subsidize the creation of Canadian programming. Some have
argued for imposing similar regulatory obligations on OTT
providers, while others favour a relaxation of obligations imposed
on incumbent broadcasters.
Following hearings held in late 2010 to consider, among other
things, the impact of new viewing platforms on private television,
the Standing Committee on Canadian Heritage issued a report recommending
that the CRTC examine the growing emergence of non-Canadian OTT
program providers and determine whether and how such companies
should support the creation and exhibition of Canadian
programming. An ad-hoc working group of executives from the
broadcasting, distribution, telecommunications, production and
creative sectors has also been lobbying the government to examine
regulatory policy respecting foreign OTT programming, including requesting that the CRTC initiate a public
In initiating the new proceeding, the CRTC noted that since its
most recent consideration of the new media exemption order, there
have been a number of material changes to the broadcasting
environment, including greater consumption of Internet-based
programming, and increased substitution by consumer of such
programming for programming from traditional broadcast
However, the tone of the Notice of Consultation, with its
emphasis on supporting data, seems to signal that notwithstanding
these observed trends, the CRTC wants a clear evidentiary record
before taking any regulatory action in the face of emerging OTT
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