A print reporter asked me some questions about the upcoming CRTC hearings on BDUs (cable TV, satellite and telco-IPTV providers), leading me to write the following diatribe (I have not proof-read this rant, I must confess).
When it comes to television, the CRTC has a two-fold responsibility: it must ensure that Canadians are well-served both by the provisions of the telecommunications act (distribution) and the broadcasting act (content). Historically, these two were inextricably intertwined, making it easier to define regulatory policies that balanced the disparate interests of the distributors and the broadcasters while simultaneously promoting and protecting Canadian content and culture. Twentieth-century distribution channels had limited capacity and there was clear and reasonable justification for prioritizing and protecting Canadian players and content in that environment. Changes in technology, however, have created a distinct separation between the medium (distribution) and the message (content). Alternative (and unregulated) distribution channels exist today that can offer an infinite range of content, and even within the regulated BDU distribution environment, technology is eliminating the scarcity of spectrum that has been an overwhelming factor in determining what content should be made available. Accordingly, policies based solely on a scarcity that no longer exists need to be reconsidered. However, that being said, we need to transition toward an unregulated (or less regulated) environment gradually lest our entire system crumble as younger viewers increasingly tune out from traditional TV delivery channels.
Sadly, Canadian broadcasters have, on the whole, been very slow to embrace alternative distribution channels -- in large part because they have little incentive to do so in the profitable, protected world in which they live today. The reality is, though, that the audience is on the move, ad dollars will follow, and there's little chance that the CRTC will attempt to regulate content on the Internet. Here, too, the broadcasters are benefiting from an artificially defined eco-system. Geo-blocking is being used by media companies in both Canada and the United States to create artificial boundaries on the Internet. This is done in large part to respect the profitable relationships that exist for conventional TV distribution rights. The result, though, is that American producers aren't reaching as large an audience as they can with their content -- and money is being left on the table. How long they'll continue to tolerate that is anyone's guess but I think it's safe to say that unless the Canadian broadcasters step up to the plate they will be by-passed sooner or later.
The tragic part of the story today is that while some nameless Canadian broadcasters blame their lack of activity in alternative distribution on the challenges of clearing rights for the content, these same broadcasters often demand that Canadian producers give sign away all new media rights to them -- and then proceed to do nothing with them, preventing the producers from benefiting from other opportunities that exist by way of alternative distribution channels.
The best thing the CRTC can do at this critical juncture, where we find ourselves somewhere between a tipping point and a breaking point, is to send a clear message to the industry that while the status quo will be preserved, more or less, for a little while, today's unsustainable protectionist system will be dismantled gradually over the next few years. There's really no choice -- dismantle it gently or watch it come crashing down -- and the sooner the industry realizes that the better it will be for all concerned.
Genre exclusivity (or genre protection): should preserve genre protection only where clearly warranted. That is, where a service exists that is of distinctly Canadian value that could not otherwise survive in the face of foreign competition, genre protection should be provided in the interim -- but those benefiting from it must be made acutely aware of the realities of the future world where we will inevitably move to a world of multiple distribution channels that won't offer the same protection.
As the various distribution channels will increasingly vie for consumer attention, dollars, and advertising revenue, a level playing field is inevitable at some future point. Today, though, while traditional TV distribution remains the dominant format, and continues to garner the lion's share of consumer dollars and ad spending, we're likely to see little emerge in the course of this review that will rock the boat. And that's both good and bad. We'll likely see the commission make efforts to balance the conflicting interests of the various corporate constituents and to, more or less, preserve the status quo for the time being. But that's not going to sustain our artificial ecosystem for long in the face of overwhelming challenges from unregulated content sources. Perpetuating a system that is already highly artificial and increasingly misaligned with emerging consumers does nothing to address chronic problems.
The fee-for-carriage issue? It's a band-aid that won't serve any long-term purpose. If the commission does yield to this recurring demand, it should insist that a large part of the funds received must be spent on the further development of alternative delivery channels. It's not a question of whether these channels will one day dominate, it's merely a question of when will they come to dominate?
Market forces are at odds with CanCon as we know it. In an environment of scarcity (i.e. traditional TV distribution) it's easy to protect and promote Canadian content. However, as we increasingly move to a world where scarcity isn't an issue, opening the traditional TV market too quickly to foreign competition will kill CanCon and do irreparable damage to the domestic production industry. That being said, foreign competition through alternative (and often unregulated) channels is inevitable -- and is already occurring. The sooner Canadian broadcasters ramp up alternative content distribution approaches the stronger their chance of survival. Failure to do so, individually or collectively, will lead to their demise.
Technology is available to shift the balance of power to the BDUs, away from the broadcasters, by way of video on demand (VOD) offerings but current CRTC-imposed constraints on BDU advertising are inhibiting the deployment of significant VOD offerings. For now, this protects the broadcasters, but we have to question whether it's right to put the broadcasters ahead of the consumer -- and that's what we're doing today.
This week saw the introduction of a limited HBO -branded service on Bell Mobility -- and that's just the tip of the iceberg. The commission will spend the next three weeks grappling with its role in the conflicting world of TV 2.0... but TV 3.0 is on the horizon already and that will change everything.
The Canadian media industry can have a strong a prosperous presence in the future, but we must start taking steps today to adapt to the change that is all around us and we can't depend on twentieth-century approaches to preserve an artificial and unsustainable ecosystem that isn't viable in the twenty-first century world.
When it comes to television, the CRTC has a two-fold responsibility: it must ensure that Canadians are well-served both by the provisions of the telecommunications act (distribution) and the broadcasting act (content). Historically, these two were inextricably intertwined, making it easier to define regulatory policies that balanced the disparate interests of the distributors and the broadcasters while simultaneously promoting and protecting Canadian content and culture. Twentieth-century distribution channels had limited capacity and there was clear and reasonable justification for prioritizing and protecting Canadian players and content in that environment. Changes in technology, however, have created a distinct separation between the medium (distribution) and the message (content). Alternative (and unregulated) distribution channels exist today that can offer an infinite range of content, and even within the regulated BDU distribution environment, technology is eliminating the scarcity of spectrum that has been an overwhelming factor in determining what content should be made available. Accordingly, policies based solely on a scarcity that no longer exists need to be reconsidered. However, that being said, we need to transition toward an unregulated (or less regulated) environment gradually lest our entire system crumble as younger viewers increasingly tune out from traditional TV delivery channels.
Sadly, Canadian broadcasters have, on the whole, been very slow to embrace alternative distribution channels -- in large part because they have little incentive to do so in the profitable, protected world in which they live today. The reality is, though, that the audience is on the move, ad dollars will follow, and there's little chance that the CRTC will attempt to regulate content on the Internet. Here, too, the broadcasters are benefiting from an artificially defined eco-system. Geo-blocking is being used by media companies in both Canada and the United States to create artificial boundaries on the Internet. This is done in large part to respect the profitable relationships that exist for conventional TV distribution rights. The result, though, is that American producers aren't reaching as large an audience as they can with their content -- and money is being left on the table. How long they'll continue to tolerate that is anyone's guess but I think it's safe to say that unless the Canadian broadcasters step up to the plate they will be by-passed sooner or later.
The tragic part of the story today is that while some nameless Canadian broadcasters blame their lack of activity in alternative distribution on the challenges of clearing rights for the content, these same broadcasters often demand that Canadian producers give sign away all new media rights to them -- and then proceed to do nothing with them, preventing the producers from benefiting from other opportunities that exist by way of alternative distribution channels.
The best thing the CRTC can do at this critical juncture, where we find ourselves somewhere between a tipping point and a breaking point, is to send a clear message to the industry that while the status quo will be preserved, more or less, for a little while, today's unsustainable protectionist system will be dismantled gradually over the next few years. There's really no choice -- dismantle it gently or watch it come crashing down -- and the sooner the industry realizes that the better it will be for all concerned.
Genre exclusivity (or genre protection): should preserve genre protection only where clearly warranted. That is, where a service exists that is of distinctly Canadian value that could not otherwise survive in the face of foreign competition, genre protection should be provided in the interim -- but those benefiting from it must be made acutely aware of the realities of the future world where we will inevitably move to a world of multiple distribution channels that won't offer the same protection.
As the various distribution channels will increasingly vie for consumer attention, dollars, and advertising revenue, a level playing field is inevitable at some future point. Today, though, while traditional TV distribution remains the dominant format, and continues to garner the lion's share of consumer dollars and ad spending, we're likely to see little emerge in the course of this review that will rock the boat. And that's both good and bad. We'll likely see the commission make efforts to balance the conflicting interests of the various corporate constituents and to, more or less, preserve the status quo for the time being. But that's not going to sustain our artificial ecosystem for long in the face of overwhelming challenges from unregulated content sources. Perpetuating a system that is already highly artificial and increasingly misaligned with emerging consumers does nothing to address chronic problems.
The fee-for-carriage issue? It's a band-aid that won't serve any long-term purpose. If the commission does yield to this recurring demand, it should insist that a large part of the funds received must be spent on the further development of alternative delivery channels. It's not a question of whether these channels will one day dominate, it's merely a question of when will they come to dominate?
Market forces are at odds with CanCon as we know it. In an environment of scarcity (i.e. traditional TV distribution) it's easy to protect and promote Canadian content. However, as we increasingly move to a world where scarcity isn't an issue, opening the traditional TV market too quickly to foreign competition will kill CanCon and do irreparable damage to the domestic production industry. That being said, foreign competition through alternative (and often unregulated) channels is inevitable -- and is already occurring. The sooner Canadian broadcasters ramp up alternative content distribution approaches the stronger their chance of survival. Failure to do so, individually or collectively, will lead to their demise.
Technology is available to shift the balance of power to the BDUs, away from the broadcasters, by way of video on demand (VOD) offerings but current CRTC-imposed constraints on BDU advertising are inhibiting the deployment of significant VOD offerings. For now, this protects the broadcasters, but we have to question whether it's right to put the broadcasters ahead of the consumer -- and that's what we're doing today.
This week saw the introduction of a limited HBO -branded service on Bell Mobility -- and that's just the tip of the iceberg. The commission will spend the next three weeks grappling with its role in the conflicting world of TV 2.0... but TV 3.0 is on the horizon already and that will change everything.
The Canadian media industry can have a strong a prosperous presence in the future, but we must start taking steps today to adapt to the change that is all around us and we can't depend on twentieth-century approaches to preserve an artificial and unsustainable ecosystem that isn't viable in the twenty-first century world.
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