CRTC on regulating Netflix: more research is needed

A fact-finding consultation appears to be the main item on the regulator’s menu, says chair Konrad von Finckenstein.

CRTC chair Konrad von Finckenstein was not especially reassuring to the Canadian industry Monday when he told the Banff World Media Festival that, when it comes to Netflix Canada, more research is required.

“It’s obviously a huge issue. And it’s characterized as Netflix, but it’s much more than Netflix,” the CRTC chair said a week after launching a fact-finding consultation with Netflix, Canadian content carriers and other industry players on how to deal with so-called over-the-top (OTT) digital platforms already in, or on the verge of entering, the Canadian market.

“We do not know what impact OTT may have. Is it an extension of our broadcasting system, complementing the traditional methods of delivery? Or is this the beginning of a paradigm shift that will eventually replace traditional methods?” von Finckenstein said in a speech delivered to Banff festival delegates, with a longer formal transcript released by the CRTC to the media.

A consortium of Canadian broadcasters and indie producers has urged the CRTC to regulate Netflix Canada as an online broadcaster, and compel it to contribute to the production of homegrown TV shows.

The CRTC chair, while offering more questions than answers about US digital platforms on Monday, did hint it would be easier if Netflix Canada, iTunes and other US players contributed to their Canadian broadcast system on their own, beyond acquiring local product for distribution on their platforms.

“These services are not required to contribute to the creation and promotion of Canadian content, although they may choose to do so,” von Finckenstein’s speech read.

The CRTC topper insisted the issue of Netflix Canada needed to be decided, either by the CRTC or possibly through federal legislation, before the challenge to the Canadian industry grew out of hand.

“What we do know is that OTT is happening now, and it’s growing fast. According to a recent report by Sandvine, Netflix alone is now delivering nearly 30% of peak downstream internet traffic in North America,” von Finckenstein argued.

“In Canada, Netflix was launched only last September, but by March it was already accounting for 13.5% of downstream traffic during the peak evening hours,” he added.

The CRTC chair insisted Canadians are embracing Netflix Canada and other digital platforms at an increasing pace.

“We’d like to know how these developments can enhance our broadcasting system,” von Finckenstein told the Banff delegates.

From Playback Daily.