Andrew Coyne: Canadian television industry fatally lost in the past
Tax it. Force it to carry a fixed proportion of Canadian content, said others. Seriously? We're going to require 30% of the Internet to be Canadian?
Until this month, the standard for heedlessness in the face of oblivion was defined by the last act of Hamlet . As you'll recall, the royal house of Denmark spend the better part of an hour merrily offing each other, for all the world as if the approaching army of Fortinbras were not about to put them all out of business. I suppose you could say they spared him the trouble.
Something of the same suicidal obtuseness was on display the past couple of weeks in a conference room in Gatineau, Que., where the Canadian Radio-television and Telecommunications Commission — to give it its full, musty-sounding title — was convening yet another series of hearings on the future of television. The CRTC has been holding hearings on the same subject at periodic intervals since I was a boy, a series of not-very-special episodes whose common feature is that they are almost always about television's past — namely, preserving the respondents' lucrative position in the firmament, even at the cost of prostrating themselves before the commission, mouthing the appropriate pieties ("we have to be able to tell ourselves our own stories") for hours on end, promising all manner of CanCon wonders and generally sucking up. Even to watch the proceedings is excruciating; I can't imagine what it's like to participate.
So it was this time, only with a twist. For the CRTC in recent years has been furiously trying to signal that it "gets it," that it understands the technological environment in which it grew up as a regulator, a world of two networks and rabbit ears and maybe cable if you were lucky , is long gone, and with it the whole closed, cosseted, back-scratching industrial model over which it has presided, to the great enrichment of a handful of network and cable players and the great frustration of the viewing public. Nowadays, with some unsubtle encouragement from its political masters, the commission is All About Choice. And Competition. And Consumers. The effect is a bit jarring, like your dad protesting his fondness for hip-hop: We be "down" with that pick-and-pay "jive," commissioners insist, adjusting their glasses. Da Consumer Is Da Shizzle. For real. Internet, yo.
Only someone forgot to tell the industry. Never mind technological change, or the economic reality that nothing and no one is going to protect them from consumers — for they were always the real enemy — any longer. Even in front of a regulator whose declared intention was to deregulate, the suits couldn't help themselves. From one submission to another, the commission heard the same shameless special pleading, the same demands for "level playing fields" and "access to our own market," the same resolute refusal to compete for consumers' dollars, rather than harvest them. Old habits die hard, I guess.
From Bell — you remember them, small shop, just barely getting by, scarcely $20-billion a year to rub between their fingers — the commission heard demands for continued limits on consumers' freedom to choose which channels they want individually (the "pick" in pick-and-pay), rather than pay for bundles of channels, most of which they don't watch; from Rogers, Bell's even more hard-done-by cousin, demands that U.S. channels be included in the bare-bones tier (known as "skinny basic") that consumers would still be forced to take, even under the commission's vision of pick-and-pay; on and self-indulgently on. (To be fair, the whining was not uniquely Canadian: Viacom, the giant U.S. carrier, intervened to say that pick-and-pay would mark the launch of "a consumer welfare destroying death spiral." Whoa. I'd watch that show.)
And though everyone swore they were there to talk about how the Internet had changed everything, most of the submissions seemed rooted in the belief that it had changed nothing. Producers objected to relaxing Canadian content regulations that are not only unneeded — nothing stands in the way of any Canadian producer posting video online for all the world to see, as thousands of them are doing — but unenforceable. Networks insisted on preserving simultaneous substitution — CRTC regulations mandating that an American station's signal be replaced by the Canadian one, where both are showing the same program at the same time — in perpetuity, it would seem, though the policy amounts to paying Canadian stations to show American programs — and though the movement to online video means Canadians can increasingly escape this regulatory feed pen as well.
About the only concession to the Internet's existence was the near universal demand — from networks, carriers, even the government of Ontario — for the CRTC to attack it: the part of the Internet being played on this occasion by Netflix. The online video distributor is hardly the only player in the game, only the most successful, though its revenues, worldwide let alone in Canada, are still a tiny fraction of Bell's or Rogers'. Yet for its sins — imagine offering programs people want, at a price they're willing to pay, on demand rather than on the schedule that suits the network — it became a favourite target of the hearings' fury.
Tax it, said some. Force it to carry a fixed proportion of Canadian content, said others. Leave aside those questions of necessity or enforceability I raised earlier. For this to make any sense, even on its own terms, you'd have to apply it not just to any one website, but to all of them, since that is the universe of choices available to the consumer. Seriously? We're going to require 30% of the Internet to be Canadian?
By the end, when Netflix finally showed up, Fortinbras-like, at the hearings, commissioners seemed to have got caught up in the retro-regulatory frenzy, pestering the company to provide it with information on its subscriber base in Canada, accusing it of taking "hundreds of millions of dollars out of the Canadian economy," and threatening, preposterously, to regulate it into compliance if it declined.
Netflix declined.
Postmedia News