BUSINESS
06/06/2018 08:57 EDT | Updated 06/06/2018 08:59 EDT

Liberals To Ask Expert Panel For Ways To Regulate Streaming Services

Heritage Minister Melanie Joly said any company profiting off services in Canada has to contribute to Canadian content.

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OTTAWA — The country's rules around broadcasting and telecommunications are set to undergo a sweeping review as the Liberals look to cut the price of mobile phone plans and force streaming services to lend more help to Canadian content.

An expert panel will have the next year and a half to help modernize the country's broadcasting regulations to respond to growing concerns about an uneven playing field between domestic providers and online streaming giants like Netflix and Spotify.

Heritage Minister Melanie Joly said any company profiting off services in Canada has to contribute to Canadian content.

Watch: Ottawa announces $500-million Netflix production deal. Story continues below.

The panel will craft recommendations on a new mandate for CBC/Radio-Canada with a view to keeping future governments from slashing its public funding. It will also revamp the role and powers of the national broadcast regulator and focus on net neutrality, say the panel's terms of reference posted to a government website.

The marching orders for the seven-member panel said the decades-old regulatory regime is unsustainable in the digital age, as Canadians more and more are turning to streaming platforms for content. But the terms of reference say the government isn't interested in ideas that increase service costs, echoing the Liberals repeated rejection of an internet or Netflix tax.

On telecommunications rules, the government asks the panel to recommend changes that promote competition in a sector with a "high degree of concentration" in order to reduce the consumer costs. The Liberals, though, say they are "not interested in a proposal that reduces Canadian ownership."

The panel will provide an interim report next June and a final recommendations six months later and weeks after the next federal election in October 2019 — ensuring internet taxes as an election issue.

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The issue is likely to be particularly acute in Quebec. Netflix has been a lightning rod of discontent in the province ever since it agreed to invest $500-million over five years in Canada as part of the federal government's cultural policy and the NDP have looked to exploit that outrage for electoral gains.

Karl Belanger, a former NDP strategist, said the government's timelines seem aimed at allowing the Liberals to not act before the election and reduce political heat during the campaign.

Federal officials have spent months trying to figure out how to rewrite myriad government regulations and laws in the face of digital disruption.

A November briefing note for the top official in Joly's department, prepared ahead of a meeting of deputy ministers, noted that there were no best practices that the Canadian government could follow or adapt. The document, obtained by The Canadian Press under the Access to Information Act, also noted that the federal government's tendency to be risk-adverse "can impede the consideration of new approaches."

"Having the right balance between not doing anything or over-responding on emerging technologies can create an uneven playing field, strangle growth for nascent industries and/or erode confidence of the public in its regulatory institutions," the briefing note said.

We need to create a level playing field and that for the Netflixes of the world..Rick Brace, Rogers Media

The Liberals have faced a growing chorus of voices to regulate online streaming services before and after that November meeting, including last week when the Canadian Radio-television and Telecommunications Commission recommended the government consider forcing any online video or music service pay to create or better promote domestic content.

"We need to create a level playing field and that for the Netflixes of the world, to be able to come in and not have any real responsibility, a hard responsibility, to Canadian program content and funding, even though they've made what I call a softer commitment to do some of that ... creates a hardship for the domestic broadcasters," Rick Brace, president of Rogers Media, said Tuesday at an event where the company unveiled its lineup for the coming TV season.

— With files from Victoria Ahearn in Toronto

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