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'It's not a tax': CRTC chair defends proposal for internet providers to contribute to Canadian content
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'It's not a tax': CRTC chair defends proposal for internet providers to contribute to Canadian content

Written by
Emily Jackson
Published by
Calgary Herald
November 1st, 2018

CRTC proposal that broadcasters pay less and broadband providers pay 1% of revenue the subject of much debate.

The head of Canada’s broadcasting and telecommunications regulator defended the proposal that everyone who benefits from Canadians consuming content should contribute to Canadian programming — including internet providers who profit from the rising demand for data.

Just don’t call it a tax.

Canadian Radio-television and Telecommunications Commission chairman Ian Scott outlined the regulator’s recommendations to the government as it reviews federal communications laws, rules that the CRTC will ultimately implement.

The CRTC’s proposal to shift the funding burden from television and radio providers to broadband providers — it suggests broadcasters pay slightly less and that broadband providers pay one percent of revenue — remains controversial. It was the subject of much debate at the conference.

On one side, creative players said internet providers and digital players such as Netflix should step in to stop the so-called “Canconpalypse,” a feared loss of Canadian content as funding dries up. TV and radio operators must pay a portion of their revenue for content, but these funds are eroding as advertising and subscription revenues stagnate.

On the other, internet service providers contend they contribute enough by spending “billions and billions” on fixed and wireless networks.

“To be fair, I think the network is our contribution,” Pam Dinsmore, Rogers Communications’ vice-president, regulatory, said during a panel discussion Wednesday.

In an interview, Scott agreed that internet providers have made significant contributions to the network, but said they’ve also grown exponentially thanks to demand for broadband and growth in online video consumption. He expects most will contribute the same amount of revenue since they distribute both TV and internet.

“It’s not a tax,” he said, instead describing it as a shift.

While it could result in extra charges for consumers with standalone internet packages, he said the fee will be minor, given average internet bills of $46 per month.

“If you’re asking me: ‘Is 46 cents worth it per month in order to support the future of viable Canadian programming?’ The answer is yes,” he said.

Either way, he’s happy the industry is debating the proposal to fund content through a surcharge on broadband connections. One year into his role as chairman, he sees the report on the future of Canadian content production and distribution as one of the key policy developments, along with progress on the broadband fund.

Scott also defended another decision taken under his tenure — against mandating wholesale wireless roaming in the context of a Wi-Fi-first provider wanting access to larger networks.

Instead, the commission sped up a review of the wireless market, which will take place next year, and pushed for more affordable plans.

“We proposed data only, lower-cost plans, and we’re pushing the industry in that direction,” he said. “If I sound defensive, it’s because I am.”

While Scott takes these complicated details seriously, he’s calling for more simplicity in the legislative review.

“The objective of the act should be a lot more clear,” he said.

Top line, he said the broadcasting system should promote the production, distribution and discoverability of Canadian programming, and the telecom laws should ensure world class communication infrastructure that’s available to Canadians at affordable rates.

© Calgary Herald

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