The CRTC hearings is continuing with Rogers feeling that news operations deserve 30% of the loot ripped off from the platforms.
The Online Streaming Act hearings at the CRTC is continuing. With the Canadian government folding to Google with the Online News Act, legacy players have realized that their dreams of freeloading off of the platforms through that piece of legislation has fallen through. This especially after it seems like the CBC, a government funded media organization, is seemingly destined to swipe a third of the cash. Supporters of the Online News Act are now turning to the Online Streaming Act, hoping to steal additional revenue after their Online News Act gambit collapsed.
Indeed, the race is on for the legacy players to see how much more money they can swindle from the system. At this point, they have all lined up at the trough with the constant barrage of “GIMME!!!” demands. Bell, for their part, was very open about their blatant cash grab. In the midst of doing their part to shake down the platforms, they openly stated, “a level playing field is not enough“, essentially dispensing with all pretense and arguing that the world should bend to their wishes. Google, for their part, reasonably called for a system that supports the digital ecosystem, though the chances of the CRTC actually listening to reason is pretty slim given their cozy relationship with the very legacy players they are allegedly regulating to begin with.
Rogers also made their appearance. If you recall, back in April, Rogers was able to complete their acquisition of Shaw, reducing the number of major telecom players in this country from 4 to 3. In short, they basically became one of the three telecom monopolies operating in the country. Mere months later, after promising additional investment and more jobs, Rogers slashed news operation budgets and began axing jobs as well. It’s a pretty par for the course turn of events when it comes to these mega-mergers in the first place.
Yet, despite the job losses at the hands of the mega-merger, Rogers seemed to have no problem trying to sell the story that news is in crisis and it is all because of those big mean platforms. The transcript of the hearing can be found on the CRTC and it details what was said during that particular hearing. Rogers got off to a fantastic start by saying that they think that the platforms should contribute 2% as a baseline contribution, meaning that the amount should go up from there. How much? Sounds like the sky is the limit for them:
4986 MR. SHAIKH: Establishing a fair initial base contribution for online streamers is a critical first step in modernizing the contribution regime and is achieved by adopting Rogers’ proposal of 2 percent.
4987 Our proposal is specifically designed to be an initial investment by foreign and unaffiliated online undertakings in the Canadian broadcasting system, which is consistent with the clear purpose set out in the Notice. It does not reflect the final base or the flexible and intangible contributions that will be considered in the next phases.
4990 It is no longer fair or sustainable for Canada’s broadcasting industry to be the primary source of funding for all stakeholders in the system. Since 2012, our BDUs and radio stations paid direct mandated financial contributions of almost $2 billion to support the CMF, CIPFs, ILNF, local expression and CCD. Of that, close to $1 billion was paid to the CMF alone. This still represents only a portion of Rogers’ contributions to the system. With a more broadly supported regime, the Commission must reduce the financial burden imposed on all contributors.
4991 Our proposal of 2 percent is a starting point to ensure that foreign streamers make an initial direct contribution in support of Canadian and Indigenous content, as required by the Online Streaming Act and the Policy Direction. However, the final contribution requirements imposed on foreign and unaffiliated Canadian online undertakings must be sufficient to:
4992 ‑ address their impact across the Canadian broadcasting system; and
4993 ‑ allow the Commission to materially reduce the financial contributions currently imposed on Canadian ownership groups.
From there, Rogers told the CRTC that 30% of that loot is to be re-directed to news programs:
5000 MS. WHEELER: Finally, you asked parties which funds should be the recipients of the initial base contributions.
5001 As you’ve heard throughout this proceeding, local news is in crisis and requires immediate intervention to ensure the ongoing health and quality of Canadian newsrooms.
5002 A fundamental outcome of the modernized contribution regime must include new mechanisms to provide long‑term financial support for high‑quality Canadian‑produced broadcast news from credible outlets. This is critical to achieving the objectives of the Broadcasting Act and the Policy Direction, and more fundamentally to the health and strength of our democracy.
5003 For that reason, in this first phase, we support directing 30 percent of online video and audio undertakings’ initial base contributions towards an interim News Fund accessible by all private TV and radio stations producing news, and it would administered by the CAB.
One thing that is obviously missing in this proposal is a guarantee that such funding would go towards actually producing said news content. This is probably not a big surprise because it’s basically an open secret that the plot is to loot the system for cash, then slash the jobs after. After all, that is exactly what happened with the CBC. After nicking $33 million from the Online News Act framework, they then proceeded to slash 10% of their workforce.
In one of the questions and answers, Rogers suggested that the money should come from platforms, not from the users:
5019 COMMISSIONER NAIDOO: In your intervention you also submitted that the definition of “social media service” must recognize that a single online platform may engage in a variety of activities, some of which appropriately fall under the Broadcasting Act’s contribution regime. Do you have any other suggestions on how the Commission could define the concept of “social media services” and their activities that are subject under the Broadcasting Act?
5020 MR. SHAIKH: We understand there has been a lot of discussion about how to capture social media services and whether they should be captured, and we want to be absolutely clear that our interest is in considering a contribution from the platforms and the contribution should apply to the platforms and that may include platforms that provide certain social media services.
5021 We are not interested in any contribution applied to social media creators, and in terms of how to define that, I think, you know, these are sophisticated companies and they have probably expertise in data analytics to help you determine what portion of their platform is dedicated to what would be defined as broadcasting. That may include some social media aspects, but, to be absolutely clear, we are not interested in regulating individual social media creators.
The talking point is pretty much identical to the CRTC talking points about the Online Streaming Act. Whether this comes from the CRTC or their lobbyist pals, it doesn’t matter. It’s still gibberish. Of course the money is ultimately going to get extracted from online creators. YouTube, for their part, is very clear about this. If there is additional expenses incurred as part of doing business in the country, they reserve the right to pass those costs onto users who have monetized their content. Ultimately, these costs are going to get pushed onto Canadian creators in the end. All this, “pinky swear, we’re not calling for this” is gibberish nonsense.
This more or less creates the situation that social media creators are going to be forced to subsidize the legacy media corporations. Put it another way, they are forced to fork over profits to organizations that technically competes against them, putting them at a total financial disadvantage. The more successful Canadian creators become, the more money flows to the likes of the heavily subsidized corporations like Bell Media and Rogers. It’s ultimately a system that extracts money from those that need it the most and hands it over to entities that need it the least.
Another comment made by Rogers is this:
5035 We have no intention of stepping away from that. But we need your help in making sure that as we compete with foreign online streamers that we either have the same playing field that they do or that we’re able to contribute in different ways.
So, let me get this straight: Rogers, which owns one of the three big telecom monopoly players, owns vertically integrated production houses like news broadcasting, and is a corporation that appears on a Canadian stock market exchange, and managed to buy out a massive telecom player (Shaw) for $26 billion, is somehow hard up for cash and can’t compete and is, therefore, turning up at the CRTC, cap in hand, begging for some financial relief? I have to ask, who are we kidding here?
What’s on display here are large corporations with the mentality that the world owes them because they graced the planet with their existence. The world is moving on from their outdated business models and they feel that they should be handed free money rather than produce a product that people actually want to consume. It’s a naked attempt to compel platforms to force feed consumers their content whether they want it or not. This while siphoning cash out of the system so they can have a constant supply of free money while driving out all competition in the process. Sadly, the system is easily corrupt enough to oblige corporations like Rogers in all of this – and it will ultimately harm Canadian consumers in the process.
Drew Wilson on Twitter: @icecube85 and Facebook.
