This article was originally published in Blakes Bulletin on Communications Law, December 2005
Article by Tricia Kuhl, ©2005, Blake, Cassels & Graydon LLP
Do cell phone television broadcasts, delivered over the Internet, fall under the CRTC’s new media exemption order? To answer this question, the CRTC has requested comments on an appropriate regulatory framework for mobile broadcasting services.
The Call for Comments was a reaction to the announcements, last spring, by Bell Mobility Inc. (Bell), Rogers Wireless Inc. (Rogers), Telus Mobility (Telus) and Look Communications Inc. (Look Communications) to launch mobile broadcasting services (Mobile TV) in Canada and a letter from the Canadian Association of Broadcasters (CAB) requesting the CRTC to determine the appropriate form of regulation for such broadcasting services.
WHAT IS MOBILE TV?
Mobile TV, launched in Canada in mid-August by Bell and Rogers and at the end of August by Telus, allows users who have compatible wireless handsets, subscribed to a data service and paid a monthly subscription fee to access in real-time live television programming on their cell phones or other mobile devices. All three wireless carriers are powered by MobiTV, a software platform consisting of a java application that must be launched by the user on his wireless handset. Once the application is launched: (i) the user may be authenticated for billing purposes; (ii) the user may select the desired TV programs; (iii) the program request is sent to the MobiTV content server; (iv) the audio-video stream is converted to a format compatible with the user’s mobile browser and handset and delivered via the Internet from the originating MobiTV server to the server of the cell phone company to which the user is subscribed; and (v) the server of the cell phone company retransmits the stream via its wireless network to the user’s mobile device.
REVIEWING THE NEW MEDIA EXEMPTION ORDER
In 1999, the CRTC issued an order exempting from regulation new media broadcasting undertakings, defined as undertakings that provide broadcasting services delivered and accessed over the Internet, in accordance with the CRTC’s then recent technologically-neutral interpretation of “broadcasting”. In essence, the CRTC concluded that the particular technology used for the delivery of signals over the Internet did not affect the determination as to whether content was “transmitted” over the Internet. Furthermore, the CRTC noted that the definition of “broadcasting receiving apparatus” includes a “device, or combination of devices, intended for or capable of being used for the reception of broadcasting”. Examples of devices mentioned in said definition include personal computers or TVs equipped with Web TV boxes, to the extent that they are used, or are capable of being used, to receive broadcasting. The CRTC held that broadcasting over the Internet did not require regulatory oversight given that, among other things, Canadian content was thriving on the Internet. Imposing licensing on broadcasting over the Internet, according to the CRTC, would not further the objectives set forth in the Broadcasting Act.
Although the Exemption Order was set to be reviewed five years after taking effect (December 2004), this date has come and gone with no movement in either direction by the CRTC. However, in its May 12, 2005 decision, the CRTC took a technologically-neutral position holding that telephone services offered using Internet Protocol (voice-over Internet Protocol or VoIP) are subject to the existing rules governing traditional telephony. Focusing on the type of service offered, rather than the technological means by which such service is being offered, the CRTC decided that even though VoIP calls are Internet-delivered, such services do not fall under the definition of new media undertakings and, therefore, are not exempt from regulation.
This recent CRTC decision may shed some light on the current thinking of the CRTC, in that the CRTC may apply the logic that if phone calls delivered over the Internet are not considered new media undertakings, neither is television delivered over the Internet to a user’s mobile device.
SHOULD MOBILE TV BE EXEMPT FROM CRTC REGULATION?
Wireless Carriers’ Views. Bell, Rogers and Telus are of the view that their cell phone TV services fit squarely within the current definition of new media undertakings and, consequently, that such services are exempt from CRTC regulation. Their position is that Mobile TV is both accessed and delivered over the Internet to anyone with a compatible phone and a subscription. Accordingly, there is no need for the CRTC to grant a further exemption order or to require a license for their mobile services.
Telus submits that “access”, for the purposes of the new media exemption, does not require specific cell phone users to have access to all Internet content from their cell phones. Conversely, according to Telus, “access” means that all Internet users must be able to access specific content. However, specific content availability,Telus argues, can be limited to those users who pay for such content and who purchase compatible equipment.
Bell submits that from a technical standpoint, the mobile broadcasting service operates no differently than any Internet media application. In effect, according to Bell, the transmission of programs to Bell’s mobile devices is materially identical to many of the Internet broadcasting scenarios considered by the CRTC in its 1999 new media exemption decision. Bell maintains that the only distinction between the audio-visual services considered by the CRTC in its 1999 decision and today’s Mobile TV services is that Bell’s current application uses wireless transmission for the “last mile” of the transmission path and has wireless handsets as its terminal devices.
Relying on the CRTC’s technologically-neutral conclusions in its 1999 new media exemption decision that neither the particular technology used for the delivery of signals over the Internet nor the device used to receive those signals affects the application of the Broadcasting Act, Bell argues, by analogy, that its Mobile TV services which use wireless transmission and wireless handsets should not be treated differently than the broadcasting undertakings currently exempt under the new media exemption order.
The wireless carriers have also expressed that cell phone TV services will not compete with conventional broadcasting services due to the small screen size, the low image resolution and audio quality and the limited battery life of mobile devices.
CAB Position. In direct contrast, CAB has taken the position that the mobile broadcasting services offered by Bell, Rogers and Telus are neither covered by the new media exemption nor currently licensed under the Broadcasting Act. The argument of CAB is based on what constitutes “access” to the Internet. If only a limited number of video or audio signals is offered to a wireless user, such user, according to CAB, would not have “access” to the Internet. Also, since the mobile services are only available to mobile phone subscribers and not to all Internet users, such services, CAB argues, are not “accessible” over the “public” Internet.
Public comments were to be submitted to the CRTC by September 12, 2005 and replies to such comments received by the CRTC by September 27, 2005.
If the CRTC decides that mobile broadcasting is not covered by the new media exemption order, the wireless carriers may be found to be operating as unlicensed broadcasters, in contravention of the Broadcasting Act. If such is held to be the case, wireless carriers may be required to pay CRTC licensing fees currently payable by conventional broadcasters and may also be subject to various restrictions including content requirements and Canadian ownership rules. Such regulatory requirements would likely lead to higher subscription fees for users and, consequently, to a slower consumer adoption rate of Mobile TV.
On the other hand, if Mobile TV remains unregulated, Bell, Rogers, Telus and others will be free to further drive the wireless technology revolution, unimpeded by regulatory red tape. As a result, consumers would likely benefit from lower subscription fees and the regulatory environment would be favourable for Mobile TV to prosper, albeit likely with significantly less Canadian content than that viewed by Canadian consumers on conventional television.
In any event, the CRTC’s decision, expected to be rendered early in 2006, promises to chart the wireless landscape for years to come.
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