The CRTC has been quite busy of late coming to the rescue of the poor, beleaguered consumer. That’s nice, but it prompts a few questions, such as: What happened? Why the change of pace? And why now?
On Wednesday, the broadcast and telecom regulator released an edict on vertical integration, or the recent trend that has seen companies that distribute things like TV shows and radio programs buy up the same producers and rights holders of those shows and programs, thereby introducing the danger of exclusive programming. The CRTC said this situation – which could potentially result in consumers having to subscribe to Bell TV to see hockey and Rogers TV to watch baseball, for example – was bad for consumers and essentially forbid it.
On Thursday, the regulator also issued guidelines on how it plans to handle complaints over service providers’ internet traffic management practices (ITMPs). The CRTC laid down its ITMP framework, which is designed to prevent ISPs from unfairly discriminating against certain kinds of internet traffic, back in 2009. The new ruling spells out how individuals can take providers to task when they feel that so-called net neutrality rules have been violated. The regulator says it will also play the name-and-shame game, where it will regularly report violators and the number of complaints it receives.
In both cases, the regulator placed the consumer front and centre. With Wednesday’s vertical integration decision, chairman Konrad von Finckenstein said: “Canadians shouldn’t be forced to buy a mobile device from a specific company or subscribe to its internet service simply to access their favourite television programs.” In Thursday’s net neutrality press release, he said: “The guidelines we issued today will help Canadians understand which practices are permitted and how to make a complaint.”
Well, well, well. Welcome to the party, CRTC. Nice of you to show up. Where have you been?
It’s hard not to be cynical about the apparent change of heart. After all, this is the same regulator who for years has been endorsing and pushing anti-consumer regulations and decisions, like the bone-headed approval of usage-based billing, the attempt to block the launch of Wind Mobile and the ongoing failure to enforce net neutrality in the first place.
It’s the same regulator whose spokesman the inimitable David Ellis quotes on his blog as saying, “We are not a consumer protection agency.”
With vertical integration, the regulator earlier this year approved Bell’s takeover of CTV with some conditions, the biggest of which was the requirement of a big investment in the production of Canadian programming. It also rubber-stamped Shaw’s acquisition of Canwest last year and launched a hearing into the effects of such vertical integration, which apparently resulted in Wednesday’s ruling.
While it’s true the CRTC placed a moratorium on any exclusive content arrangements when the Bell-CTV deal was announced in March, it didn’t take a rocket scientist to figure out that such was the end game of all involved players. Exclusive content was always at the root of the numerous billion-dollar takeovers, yet the regulator allowed them to happen anyway. Wednesday’s decision could easily have been included as a precondition to any of the deals going ahead and may have, in fact, caused some of the acquirers to think twice.
Instead, the new ruling is surely just the beginning of what will be a long and arduous battle that may go to the courts or cabinet, especially if Bell has anything to say about it, and of course it does.
On the net neutrality guidelines, well let’s just say 2009 called and it wants its complaint back. Consumer groups and politicians alike have since day one been critical of the framework for putting too much onus on internet users to prove issues and for being non-transparent. Again, these are criticisms that should have been prevented in the first place, or dealt with much sooner otherwise.
So why is the CRTC suddenly getting wise to the wants and needs of consumers? The most likely reason is because von Finckenstein and the other commissioners are getting tired of being embarrassed. On the Wind Mobile issue, the commission was thoroughly red-faced when the government overturned its decision, which led to the wireless carrier starting up. The CRTC was also caught with its pants down on usage-based billing, which resulted in a particularly embarrassing and somewhat sad grilling by commissioners of Open Media, the advocacy group that led the anti-UBB charge, during a hearing this past spring.
The truly cynical might say the new attitude is an effort by the chairman to get himself back into the good graces of the government. Von Finckenstein is reportedly seeking another term, but that seems about as likely as the vertically integrated media companies throwing their hands up and accepting the regulator’s Wednesday decision, or ISPs abandoning their throttling practices altogether.
In the end, although it’s easy to criticize the CRTC for being largely anti-consumer over the past few years, it really isn’t the regulator’s fault. Its split personality is a direct result of conflicting messages it has received from the government. When the Conservatives took office back in 2006, they told the commissioners to ease off regulating and instead let “market forces” do their thing. As I’ve harped on many, many times, with foreign ownership restrictions creating major barriers to new competitors of all stripes, market forces have never actually existed, so neither has competition in all the areas the CRTC governs.
The regulator has therefore been charged with trying to keep the chickens (aka consumers) happy while the wolves run the henhouse. No wonder it’s suffering from a major case of schizophrenia.