Netflix using paid actors again - in Ottawa

08 Feb

Canadian internet activists have spent the past few days rejoicing over what looks like a victory in the usage-based internet billing fiasco. Last week, Minister of Industry Tony Clement told our regulator that if it doesn’t go back and reverse its decision, he will. In the meantime, UBB has been delayed for at least 60 days and now we wait to see how this will all play out.

But the activists shouldn’t get too happy because they can’t claim sole responsibility for the government wading into this issue. While the 400,000-plus people who have signed the Stop The Meter online petition certainly made things easier for Clement, there probably wouldn’t have been any action without some good, old-fashioned lobbying.

At the centre of the whole UBB debate has been Netflix, the U.S. video streaming service that launched in Canada last fall. In its first few months of existence here, it’s become abundantly clear that many Canadians’ internet usage caps simply won’t accommodate anything but sparse usage of the service. Netflix CEO Reed Hastings said as much during an earnings conference call two weeks ago.

But about a week before Hastings publicly criticized Canada’s woeful internet caps, Netflix lobbyists were pounding the pavement in Ottawa. Subrata Bhattacharjee, a partner at Toronto law firm Heenan Blaikie, spent two days meeting with CRTC officials - including chairman Konrad von Finckenstein - as well as high-ranking officials from Clement’s Industry Canada department, including two assistant deputy ministers.

The purpose of the meetings, listed in the lobbyist registry, was to discuss “telecommunications” and “broadcasting.” A spokesperson for Netflix didn’t elaborate much when I asked, but it’s a sure bet those pesky internet caps were the topic of discussion. It’s an interesting time-line and you can just imagine how it all went down:

Jan. 19: Bhattacharjee meets with KvF. Bhattacharjee: “So are you going to enact UBB?” KvF: “Ja.” Bhattacharjee: “If you do, we’ll publicly denounce Canada’s internet situation.” KvF: “Be my guest, mein freund.”

Jan. 25: The CRTC gives final approval to UBB and its pricing scheme.

Jan. 26: Hastings publicly craps on Canada’s internet.

Jan. 27-28: Media picks up on the story and the Stop The Meter petition starts gaining momentum.

Feb. 1: Clement and Prime Minister Stephen Harper indicate they’re going to overturn the CRTC.

Feb. 3: Clement gives KvF his ultimatum. KvF: “Ach nein!”

Any way you slice it, it’s clear this was a strategic and well-orchestrated play by Netflix to push the issue of download caps. Not that any consumers are complaining, especially if concrete government action follows.

Don’t get me wrong, lobbying isn’t always a bad thing - it is often quite desirable for policy makers to hear things straight from the horse’s mouth. And you can’t exactly blame Netflix for playing the game either, given that Bell Canada’s lobbyists are regular fixtures in the offices of those policy makers (if you want to be astonished, click that link). But it’s important to remember that it’s not necessarily public desire that makes things happen.

It was a similar situation with the whole Globalive/Wind Mobile fiasco in 2009. While Canadian consumers were begging for new carriers and the competition they would bring, Globalive lobbyists were clocking overtime in schmoozing with VIPs in Ottawa. And we all know how that turned out.

NOTE: I wasn’t sure if those links to the lobbyist registry would work or not, and it looks like all you get is a search page. If you want to see the records, you’ll have to either type in Netflix, Bell Canada or Globalive. Sorry about that.

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Posted by on February 8, 2011 in crtc, government, internet, netflix, telecommunications


One response to “Netflix using paid actors again - in Ottawa


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