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Canada Government Media The Internet

Canadian Regulator Threatens To Impose New Netflix Regulation 324

An anonymous reader writes: Netflix appeared before the Canadian broadcast regulator today, resulting in a remarkably heated exchange, with threats of new regulation. The discussion was very hostile — the CRTC repeatedly ordered Netflix to provide subscriber information and other confidential data. As tempers frayed, the Canadian regulator expressed disappointment over the responses from a company that it said "takes hundreds of millions of dollars out of Canada." The CRTC implicitly threatened to regulate the company by taking away its ability to rely on the new media exception if it did not cooperate with its orders.
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Canadian Regulator Threatens To Impose New Netflix Regulation

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  • by ganjadude ( 952775 ) on Friday September 19, 2014 @01:49PM (#47948343) Homepage
    why does anyone other than netflix need to know who their customers are?
    • by Anonymous Coward on Friday September 19, 2014 @01:52PM (#47948367)

      The CRTC is in the pockets of companies that don't like netflix, aka cable companies.

      • Re: (Score:2, Insightful)

        CRTC is nothing more than another bureaucratic regulatory agency that is seeking to expand its powers by doing the bidding of the kings and queens, against the interests of the serfs. Anyone that seeks to limit these new expansions of powers is quickly labeled as wanting "Somalia" or "Dirty air and water" or other such nonsense.

        The result, is the fear mongers win, and those are the Bureaucrats and Politicians seeking to expand their power and authority, and bribes and future "consulting agreements"

        So, the n

        • by i kan reed ( 749298 ) on Friday September 19, 2014 @02:07PM (#47948537) Homepage Journal

          To clarify, in this case [huffingtonpost.ca] they claim that netflix doesn't do enough to encourage the production and consumption of Canadian entertainment, a requirement they place on other distributors.

          So they're, in theory, doing exactly what you say, just in less harsh terms. They want to ensure the continued interest of Canadian producers, and not American.

          And they're using arbitrary leverage like demanding subscriber lists to push netflix to obey. It's not neat or nice. But they're kinda being upfront that it's just leverage not genuine interest in the records.

          • by Dixie_Flatline ( 5077 ) <vincent@jan@goh.gmail@com> on Friday September 19, 2014 @02:34PM (#47948821) Homepage

            I'm not sure if anyone commenting on this story is actually Canadian, but the Canadian Content mandate has existed for years. It's not about favouring Canadian production companies so much as encouraging Canadian content for cultural reasons. Being so close to the USA leaves us vulnerable to sort of being swamped, culturally.

            Radio stations are required to play a certain amount of Canadian music as well. It's not really anything new.

            Personally, I like the idea of that. It encourages and funds a lot of Canadian artists that might otherwise get swamped out of the market by monied American interests.

            • Except Netflix is **not** a Canadian company.
              • by JMJimmy ( 2036122 ) on Friday September 19, 2014 @02:42PM (#47948931)

                Except Netflix is **not** a Canadian company.

                Your point? ABC/NBC/Fox/etc are not Canadian companies, they still have to comply with CanCon rules within Canada. Netflix is operating under an exemption from those rules right now.

                • Huh? The American networks as carried in Canada do not have 50% Canadian content in prime time. In fact, it's probably zero percent.
                  • Re: (Score:3, Interesting)

                    by JMJimmy ( 2036122 )

                    It's 55% from 6pm to midnight, however, part of the way they get around it is that commercials are included which means they only need to air 66 minutes of non-commercial Canadian content during that period. Usually that takes the form of news.

                  • It's the commercials.

                    Let's say a US show like Sleepy Hollow from Fox is playing for instance.
                    I'm only thinking of that one as it's totally being bombarded on me as part of the fall lineup at the moment and know which station in the US plays it.
                    Now, Global TV in Canada has the rights to play that same show in Canada and is doing so at the same time.
                    Well what would be the point of paying for ads on Global if everyone is watching the US feed via cable and satellite?
                    So the solution is to have the Global
                  • by Mashiki ( 184564 ) <mashiki@gmail.cBALDWINom minus author> on Friday September 19, 2014 @03:26PM (#47949479) Homepage

                    Huh? The American networks as carried in Canada do not have 50% Canadian content in prime time. In fact, it's probably zero percent.

                    You're right, the only reason they don't is because the channels that are canadian get overwritten by the cableco/satellite provider when it's also broadcast on a US channel. So they get their "canadian content" that way. The only way to get a US channel in Canada that isn't simulcast is by OTA.

                • Global, CBC, ATV, CTV, etc have to to comply. The stations that rebroadcast or simulcast American Television content.
                • by mysidia ( 191772 )

                  Your point? ABC/NBC/Fox/etc are not Canadian companies, they still have to comply with CanCon rules within Canada. Netflix is operating under an exemption from those rules right now.

                  Netflix is not a broadcaster/Television company. They are a subscription internet service that streams video over the internet or ships DVDs for rental on demand.

                  As such, they do not need to license any spectrum or broadcast rights, as their transmissions are in private over the telecommunications network. And they are es

                  • by JMJimmy ( 2036122 ) on Friday September 19, 2014 @05:36PM (#47950503)

                    The law deals with "signals which carry sound and images" - it's not technology specific. That's why, years ago, they introduced the "digital exemption" for internet based services to allow them to grow/keep entry barriers low for new services. That exemption is granted (or revoked) a the CRTC's discretion and that's what this set of hearings is for - to figure out whether to regulate, deregulate, or maintain the status quo on both traditional broadcasters and new media.

                    In Canada corporations are not people, they do not have free speech rights.

            • by Kristian Brigman ( 3387951 ) on Friday September 19, 2014 @02:55PM (#47949121)
              Except.... cable companies program what they are going to play. Netflix plays what their subscribers want to see. What are they supposed to do, put up a notice saying 'You can't watch the next episode of "Under the Dome" until you first watch your quota of 3 of these other Canadian shows?' The rules don't even make sense for the Netflix model.
              • by i kan reed ( 749298 ) on Friday September 19, 2014 @03:07PM (#47949231) Homepage Journal

                Netflix plays what their subscribers want to see

                Then why do they have so many reality TV shows? Ugh.

                No, but really, the set of inputs to what Netflix has is quite complicated. They love things with cheap per showing licenses, like off-the-air TV shows, unpopular movies, documentaries where the producers are more interested in pushing a message than making a profit, and a smattering of more popular "draw" shows/movies to bring in the popular audience.

                And then there's the loss-leader shows trying to get people to start watching the series as it comes out, either on pay services or with commercials.

                And then there's the various "taste profiles" of the people who are netflix subscribers, and what's both cheap and good within that frame.

                There's some pitiable accountants in the company who's responsible for balancing all those factors, while making a profit.

                Reducing all that to "giving the people what they want" is a little unpragmatic.

                • Re: (Score:3, Interesting)

                  That's not the point... i don't know the details, maybe it's more complicated than this, but as i understand it there are rules about playing X% of canadian content. for a radio station, this means that if there are 24 hours in a day, they may need to play e.g. 10 hours of canadian music and 14 hours of everything else (announcers, commercials, foreign music, etc). And you either listen to it, or don't, but you can guarantee a certain percentage of supply. If you watch or listen to any particular station fo
              • by kuzb ( 724081 )

                Watching under the dome wouldn't be a reward, it would be a punishment.

            • by phorm ( 591458 )

              Being so close to the USA leaves us vulnerable to sort of being swamped, culturally.

              What *is* culturally *Canadian*? Seriously, we've all seen the stereotypes like mounties and beavers (or a mountain and a wolf a la "Due South"), but is that really a defining part of Canadian identity?

              I enjoyed "Bon Cop Bad Cop", but it wasn't really special content-wise. I certainly hope that we're not expecting that "Trailer Park Boys" or "Corner Gas" is really Canadian? Do we expect the actors to drink Canadian beer inst

            • I didn't know that, probably many here didn't. But it does seem a bit odd, as I've never even heard of such a thing happening in any other country. Why doesn't Canada just take justin beiber back, call it even?
          • Maybe they should just offer a link to a free YYZ download with every Netflix membership. Problem solved.

          • Sadly one of the most watched things on netflix in my household is Mighty Machines [wikipedia.org] which is a Canadian show. With 2 small boys it is a godsend and so much less grating that Hard Hat Harry.
        • by JMJimmy ( 2036122 ) on Friday September 19, 2014 @02:08PM (#47948547)

          Check the facts before making snap judgements. This article is blatantly misleading to the events that actually occurred. Here's the actual video from the hearing:

          https://www.youtube.com/watch?... [youtube.com]

          Summary: Commission is seeking information to make a decision - even in its conversation with Netflix they state they are not leaning in any direction (regulation or deregulation). The commission requested information, Netflix rep refused to commit to provide it. This pissed off the head of the CRTC because Netflix doesn't have a choice - by operating in Canada they must provide the information. The CRTC repeatedly had to make it an order for Netflix to provide the information it was requesting to backup assertions made by Netflix to the commission with actual facts/data.

          • And who can forget, "Wind At My Back"? Brilliant!
        • by NeutronCowboy ( 896098 ) on Friday September 19, 2014 @02:13PM (#47948613)

          Wow. Every regulatory agency is just there to expand its own powers? They do nothing else?

          The reason people point you at Somalia is because your hyperbole leads you directly there. Want to have a civilized discussion about the optImal size of government? Great, start by dropping the ridiculous hyperbole.

        • You've got no idea of what you're talking about. The biggest reach that politicians have on this is being able to threaten to take their mandate away on broadcast regulatory issues. And it has nothing to do with libertarianism, this is due to excessive regulation not too little. And why is this happening? Because the CRTC is packed with suits from the major telcos, cableco's, and industry insiders. I'm sure someone will scream "lulz harper" but I'll point out now that this is how it has been since the CRTC got started.

          The CRTC mandates: internet, pricing controls for the internet, third party pricing controls for the internet, cancon, who can or can't have a broadcast license, telephone, telephone quality, and several other things. Industry Canada on the other hand their biggest reach is spectrum.

      • The CRTC is in the pockets of companies that don't like netflix, aka cable companies.

        Fire the CRTC from the top to the bottom. If they are having their salaries paid for by taxpayers but are not looking out for their interests then let them go work directly for the cable companies instead.

      • by lucm ( 889690 ) on Friday September 19, 2014 @02:19PM (#47948695)

        No it's not. That's quite the opposite: most cable companies would like to see the CRTC go away because it forces those who have specialized channels (basically every single profitable cable company) to contribute to a big pool of money that public services can tap into to subsidize their ad-free programming (which directly competes with private cable companies) and to pay for content that nobody cares about and that will never make money (a la CSPAN or PBS).

        The truth is that the CRTC is mostly a symbolic agency with very little power. They report to the Minister of Canadian Heritage, which has maybe 3 employees and 2 interns. They don't control the frequencies or anything like that.

      • The CRTC is in the pockets of companies that don't like netflix, aka cable companies.

        So, they'll end up with a list of people who can't stand cable companies?

        Oh yeah, I can smell the value steaming out the marketing department already.

    • FTA: "(conversely, U.S. regulators can provide guarantees of confidentiality)"

      WHY does ANYONE other than Netflix need to know who the subscribers are or what they watch?

      • by gnupun ( 752725 )
        If this type of info gathering is common from governments and commercial agencies, we need a more anonymous Internet.
      • FTA: "(conversely, U.S. regulators can provide guarantees of confidentiality)"

        WHY does ANYONE other than Netflix need to know who the subscribers are or what they watch?

        CRTC didn't ask for that information

        What they did ask for was:

        a) Total number of subscribers
        b) Anonymous data on total views of content found in the "Canadian" genre that Netflix maintains
        c) How PIPEDA was being complied with, especially given the way the Netflix recommendation algorithms work
        d) How much they were investing in Canadian produced content

    • why does anyone other than netflix need to know who their customers are?

      Why does a government regulatory body need to know who your customers are? Are you kidding?

      • by lgw ( 121541 )

        No, really, why is it anyone's business at all?

        Governments' legitimate interest in regulation is in product safety and fraud prevention, not in deciding who gets to do business with whom and at what price.

        We've had far too many "regulation: good vs bad?" debates here on /., and we should really stop that, as that's a silly question. The interesting question is "regulation: what scope?".

        Is there any legitimate reason for a government regulatory body to inspect and control subscriber lists for an entertainme

      • why does anyone other than netflix need to know who their customers are?

        Why does a government regulatory body need to know who your customers are? Are you kidding?

        No, we are not kidding. Tell us why bureaucrats, who are paid for by tax payer dollars need to know anything. I want to know who is being bribed and by who so I can both demand that the official be fired immediately and so that we can demand that the bribers can be brought up on bribery charges.

    • I suspect they just want to know how many customers they have, not specifically who they are.

      One of the CRTC jobs is to ensure Canadian TV content gets created and we are not stuck with 100% American programming and Canadian culture disappears entirely. If everyone starts watching all their TV on Netflex and similar services, Canadian TV could all but disappear. Most counties other then US have systems to ensure domestic content is produced, but Canada is so close to the US, the pressure far greater.

      Movies

      • by jedidiah ( 1196 )

        > I suspect they just want to know how many customers they have, not specifically who they are.

        Nonsense.

        I am sure that Netflix is more than willing to BRAG about how many Canadian customers it has, or how many customers it has in ANY country.

        Way different kettle of fish than actual subscriber info.

        • It was the number of subscribers:

          http://business.financialpost.... [financialpost.com]

          Estimates of the number of Canadian subscribes are only available from surveys:

          http://www.huffingtonpost.ca/2... [huffingtonpost.ca]

        • > I suspect they just want to know how many customers they have, not specifically who they are.

          Nonsense.

          I am sure that Netflix is more than willing to BRAG about how many Canadian customers it has, or how many customers it has in ANY country.

          Way different kettle of fish than actual subscriber info.

          Watch the hearing, I posted the YouTube link above - they only asked for the total number of Canadian subscribers and Netflix considered that "sensitive" information and refused to give it.

      • by dskoll ( 99328 )

        If everyone starts watching all their TV on Netflex and similar services, Canadian TV could all but disappear.

        Speaking as a proud Canadian, I say: Good. That's called the power of the free market.

        I have no doubt that 90% of Canadian content producers would shrivel up and die without CRTC protection. I also have no doubt that the survivors would adapt, improve, and make shows that people actually want to watch, possibly even opening up an export market for Canadian content.

        Any time the government pr

      • Canadian culture disappears entirely. If everyone starts watching all their TV on Netflex and similar services, Canadian TV could all but disapper.

        What Canadian culture? I am Canadian culture, my friends are Canadian culture, a big chunk of the Canadian population being immigrants are Canadian culture. Maybe they should make more Native shows/programming to teach some Canadian culture.

        90% of things we buy is made somewhere else but Canada. How about penalizing clothing manufacturers unless they make certain amount of clothing in Canada with a Canadian theme.

        `

    • Could it be that Terrorists watch movies? In Canada? And that the Kanucks don't know who they are unless they subscribe to Netflix?

      What a great Movie and Game idea!
    • why does anyone other than netflix need to know who their customers are?

      They weren't asking for who the customers where, they were asking for a total subscriber number (I'd suspect to help assess the scale of "new media" vs traditional broadcaster market penetration), information on Canadian content (aggregate, anonymous information not customer specific), and information on PIPEDA compliance (Canadian privacy law).

  • Institute a low cap on monthly data consumption, then watch who hits the cap.
  • I could care less to support Canadian made content that I could care less to watch. Funny how this pops up just when Shaw and Rogers are releasing their version of Netflix. Netflix should just pull out but allow people to buy and look the other way. I`d rather pay for a VPN to access than to let the gov clamp down on emerging technology and markets.

    • Netflix can't do as you suggest, because they want to continue operating in the US. Positive verification of the billing zip code is required; Netflix didn't implement that on a whim, they do it because the rights-holders require such checks. The TV and film industries like to control the availability of their properties at a national level, and since all the most desirably content comes from a small few corporations Netflix has to be careful not to offend.
      • Singing up for Hulu worked fine for me using a US zip code and my Canadian cc. Although I don`t have Hulu anymore I used it for a VPN for over a year.

    • by JohnSearle ( 923936 ) on Friday September 19, 2014 @02:42PM (#47948935)

      Not that I necessarily agree with regulating content on Netflix; but there is a connection between media and opinions around ideologies, national unity, political awareness, amongst other topics. Being overwhelmed with cheap American content doesn't assist in educating Canadians about Canadian values and awarenesses. This is even more problematic when the viewers are still learning / developing their value systems (e.g. children).

      I recall seeing some statistic that showed that an increasing number Canadians were more aware of the American political system then there own... a sad state of affairs that is due to an overwhelming amount of American media presence. It is this type of situation is what the CRTC is attempting to mitigate through regulation.

      • by dskoll ( 99328 )

        If you want Canadians to watch Canadian content, then... make content that Canadians want to watch. It's that simple.

        I watch a few excellent Canadian shows (for example, TV Ontario's The Agenda). But most TV shows produced in Canada are crap. They're no better than the cheap American shlock.

      • Being overwhelmed with cheap American content doesn't assist in educating Canadians about Canadian values and awarenesses.

        Why should this even remotely matter? It is not a government's job to educate its citizens about values that it wants to promote. In fact, that's an extraordinarily bad idea.

  • Fire the entire entity and create a new one that is responsive to taxpayer needs and concerns instead of big companies.
  • by Mashiki ( 184564 ) <mashiki@gmail.cBALDWINom minus author> on Friday September 19, 2014 @02:21PM (#47948713) Homepage

    Sounds like I need to contact my MP, last time the CRTC pulled this shit with UBB it took the federal government threatening to pull their mandate for them to smarten up. Fellow canucks can contact their MP via this list here. [parl.gc.ca] Sounds like they need to be threatened again, and if they decide to piss on us--I'll get a VPN and get the US netflix. And if they make it illegal like US satellite dishes, people will say fuck you anyway.

    There's a reason why the cableco's up here are hemorrhaging subscribers.

  • Easy solution... (Score:4, Insightful)

    by Em Adespoton ( 792954 ) <slashdotonly.1.adespoton@spamgourmet.com> on Friday September 19, 2014 @02:30PM (#47948779) Homepage Journal

    I've got a solution that will make everyone happy:
    Have NetFlix partner with the NFB to distribute NFB content... globally. Nothing like providing global access to Canadian content. NetFlix could even provide it for free to everyone in Canada with an account but no current subscription. Under this setup, the CRTC wouldn't have a leg to stand on, as at that point, they will get their Canadian Content on NetFlix (not sure about the French/English ratio though).

    HOWEVER

    I'm pretty sure this really has nothing to do with NetFlix and EVERYTHING to do with the new consortium raising a Canadian NetFlix "competitor" (Shomi) whispering nasty things in the CRTC's ear. Yes, blame Rogers/Shaw for this fracas, as they're likely where the blame really lies.

  • Someone should tell the Canadian regulator he (they) got Burger King.
  • The CRTC is nuts. The only things the CRTC should regulate are telecommunication tariffs, bandwidth allocation, telemarketing abuse and wireless interference. Trying to "protect" Canadian content is ridiculous in 2014. Either our Canadian content is good and will find a Canadian and international audience, or it's crap and the content producers will deservedly go out of business.

    There's no place any more for cultural protectionism.

    • by vux984 ( 928602 )

      There's no place any more for cultural protectionism.

      Canadian content laws combined with tax incentives are what created and sustains hollywood north, a significant film and TV production industry within Canada that would otherwise not exist, that generates jobs and incomes in Canada.

      Kill the laws, and you kill an industry. How does Canada win that way exactly?

      Protecting Canadian content is far more than just protecting Canadian "culture", its a very real protection of a whole industry that pretty clearly a

      • by dskoll ( 99328 )

        Killing a non-competitive industry causes short-term pain. But in the long-term, a more competitive and stronger industry will emerge.

        Just as the US and Canada should never have rescued the auto-makers when they imploded, there's no way a government should use taxes or protectionist laws to protect non-competitive industries.

  • by SleepyHappyDoc ( 813919 ) on Friday September 19, 2014 @02:52PM (#47949081)

    If Netflix really feels pressured, they will simply leave Canada. I suspect their Canadian revenues make up a pretty small piece of their pie. Thanks, CRTC.

    • by dskoll ( 99328 )

      The population of Canada is roughly the same as the population of California. I can't see any company willingly ceding such a market.

  • by meustrus ( 1588597 ) <meustrus@PLANCKgmail.com minus physicist> on Friday September 19, 2014 @03:00PM (#47949163)

    Netflix appeared before the Canadian broadcast regulator today, resulting in a remarkably heated exchange, with threats of new regulation. Blah blah blah, confidential data that CRTC may or may not have right to see but we won't tell you, blah blah blah, redundant stuff, blah blah, no more information, blah blah blah, click the link if you actually want to know what the fuck we're talking about, blah blah blah...

    It's pretty much impossible to expect a reasonable discussion on Slashdot when the summary is such redundant tripe. After all, nobody around here RTFA. So all we have is basically, "Netflix and CRTC had a fight about something". I'm not Canadian, I don't know anything about the CRTC or why it has any regulatory authority over Netflix, or what these ominous-sounding "regulations" might be. And I doubt every Canadian could answer those questions either.

    Although considering the article itself, maybe that's actually the best the summary could do. I learned more than the article had to say just by scrolling through the existing Slashdot comments to see if anybody else had already made the comment I'm making. These being Slashdot comments, however, I'm a little scared about the value of that information.

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