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Should Netflix Be Regulated as a Traditional Canadian Broadcaster?

09/12/2014 12:27 EDT | Updated 10/30/2017 19:46 EDT
Netflix

For the past couple of days, the CRTC has been holding wide-ranging hearings on the future of Canadian television. The way the sector is regulated certainly needs revising. Rules pertaining to Canadian content, for example, were written years and decades ago when there was no such thing as watching videos, movies and TV series on the Internet. And the CRTC also regulates prices, the definition of a basic service, the bundling of channels, etc.

The Internet being a global phenomenon, there is now an obvious discrepancy between the rules applying to Canadian broadcasters, and what any company from anywhere in the world -- Netflix being the most prominent -- can "broadcast" in Canada through a website or an app.

Very often, when certain companies are subject to restrictive regulation while some of their competitors are not, the debate takes a predictable turn: There are calls from the regulated companies for the same rules to apply to their competitors.

That's what happened three years ago when a group that included most Canadian broadcasters asked the CRTC to impose stiffer rules on Netflix operations in Canada. All providers, they claimed, should be subject to the same rules as traditional Canadian broadcast providers. Otherwise, said Ian Greenberg, then Astral's CEO (a company that has since been bought by Bell), there is "unfair competition."

Mr. Greenberg certainly had a point. Imposing rules on some players that others offering the same products or services can avoid is the antithesis of a free market with a level playing field. But isn't there another option besides subjecting everyone to the same stifling regulation?

The most interesting testimony so far at the CRTC hearing has been that of Quebecor's CEO, Pierre Dion. He agrees that Netflix is set to become the largest distributor of video content in Canada if it retains its advantageous position, leaving domestic broadcasters struggling to compete.

But regulating the Internet is unrealistic, he correctly observes. So Mr. Dion bucked the trend with this bold proposal: He urged the CRTC to "lighten the regulatory burden" on all broadcasters, instead.

Wow! Imposing fewer rules on everyone instead of forcing everyone to wear a similar straightjacket: What a refreshing concept!

For too long, the default position has been that whenever there was any new development in the economy, the government had to extend its broad regulatory mantle to cover it.

We're now burdened with a gigantic regulatory apparatus, and with bureaucrats sticking their noses in almost everything we do. This not only slows down our economy and makes it more difficult for our entrepreneurs to innovate, but it also curtails our choice and our freedom as consumers.

I hope Mr. Dion's proposal will inspire other business leaders, not just in broadcasting but also in other industries where the same issues arise, to call for a level playing field by reducing and simplifying the rules of the game for everyone rather than asking to make life equally miserable for all.

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