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Netflix should play by the rules that govern everyone else

By Sheila Copps      

Netflix insists that it should not be subject to the same regulations as other content carriers. The usual suspects are lining up on both sides of the Canadian content issue. The debate on Cancon is almost as old as the beginning of radio.

Canadian Heritage Minister Pablo Rodriguez, pictured recently on Parliament Hill. The Hill Times photograph Andrew Meade
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OTTAWA—Netflix just hiked its Canadian prices by three dollars a month.

That represents an increase of almost 30 per cent and it barely made a ripple on the consumer outrage meter.

Can you imagine the public pushback if Rogers or Bell were to hike their prices by almost 30 per cent?

There would be parliamentary inquiries demanding that the big broadcasting behemoths stop their greedy exploitation of Canadians.

But the biggest behemoth of all is Netflix, and it is fighting tooth and nail to remain outside the Canadian media regulatory framework.

Netflix insists that it should not be subject to the same regulations as other content carriers. The usual suspects are lining up on both sides of the Canadian content issue.

The debate on Cancon is almost as old as the beginning of radio.

Back on Sept. 11 in 1929, the Royal Commission on Canadian Radio Broadcasting issued a report that established the first blueprint for how the public airwaves would remain in public hands.

Known as the Aird Report, its conclusions, as follows, have survived the test of time. “The commission therefore emphasizes the idea of broadcasting as a ‘public service’ and recommends that Canada establish a national broadcasting company that will produce programs of ‘high standard.’ It also advocates setting up a chain of high power stations which will be funded by revenues from receiver licence fees, advertising sales and government money.”

In 1932, the first regulatory body was established by law, the Canadian Radio Broadcasting Commission, which was accorded the authority to control all broadcasting and to set up a national radio service. Four years later, a new Canadian broadcasting act abolished the CRBC and established the Canadian Broadcasting Corporation. The act gave the CBC the power to issue licences and also set up a bilingual radio service.

Fast forward two decades and the arrival of television prompts another update of the regulations.

In 1951, the Royal Commission on National Development in the Arts, Letters and Sciences chaired by Vincent Massey, extended the examination of radio to television broadcasting. Included in the study was a recommendation to align television’s technical signal requirements with those of the United States, opening the door to the first cross-border exchange of program signals in the world.

The Broadcasting Act was passed with a mandate to “safeguard, enrich, and strengthen the nation of Canada from sea to sea.”

Throughout its history, the fight between supporters and opponents of CANCON has been eerily repetitive.

Supporters point out the need for Canadian spaces to tell Canadian stories while opponents say we should not interfere with the role of the free market.

The players may change, but the arguments remain the same.

Michael Geist, a longtime cancon opponent, holds the Canada research chair in internet and e-commerce at the University of Ottawa law faculty.

He has built a career on opposing Cancon, and was a key critic when as minister; I pushed for more regulation and the establishment of a national television fund which morphed into the Canada Media Fund.

Just last week, Geist penned a doomsday scenario for The Globe and Mail in which he claimed that broadening the definition of Canadian broadcaster would force consumers to pay for a digital wall consisting of new taxes and regulations.

Nothing could be further from the truth.

Geist built his argument on the fact that the Canadian content industry is alive and well and making plenty of creative product for viewers.

But he neglects to point out the health of the domestic industry is prompted by the same regulatory framework he denounces.

Contributions from cable and television providers and government subsidies meant the fund invested $352-million into Canadian content this year.

The tax system was also instrumental in encouraging foreign companies to hire local by offering tax relief for employment of Canadian workers.

Geographic proximity to the United States and the relative discount of the Canadian dollar make Canada an ideal destination for Hollywood productions looking to maximize their return on investment.

Industrial productions are thriving. But they should not be mistaken for Canadian content.

The beauty of Netflix’s financial model is that it films universal stories that are designed to avoid highlighting a single, identifiable country.

Exempting Netflix from the rules that govern everybody else makes no sense.

Geist claims consumers would be victims in a Netflix Cancon world.

On the contrary, consumers will benefit from more content.

Netflix should play by the rules that govern everyone else.

Those rules have obviously been working.

Sheila Copps is a former Jean Chrétien-era cabinet minister and a former deputy prime minister. 

The Hill Times

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