Subscription model the most viable way to support television content, says Rogers

OTTAWA--The traditional television subscription model remains the most viable way to financially support televised content, Rogers Communications Inc. told the House of Commons Standing Committee on Canadian Heritage Tuesday. The Heritage committee is studying emerging and digital media. At a committee meeting Tuesday, Pablo Rodriguez, the Liberal heritage critic, asked whether there is a future for traditional, linear television, when some experts say people’s watching habits will migrate to the Internet. “If Rogers succeeds in harnessing digital technology to modernize its cable television service, it means that the CRTC can continue to impose the Canadian content regulations it imposes today,” Ken Engelhart, Rogers’ senior vice-president of regulatory affairs, told the committee. “However, if all television content migrates to the Internet, Canadian television will lose the benefit of Canadian content quotas.” Engelhart said cable companies need to compete with the Web and follow the example of phone companies that have successfully competed with IP-based services like Vonage and Skype. “The overwhelming majority of phone calls are still made over the phone network,” Engelhart said. “The phone companies have adapted by using Internet technology, although not using the Internet.” He said the cable companies and broadcasters must adapt to digital technologies to retain their customers. But Rodriguez asked how Canadian content regulations can be applied to the Internet. Engelhart said that the content now provided on linear television can continue to be regulated on new distribution platforms. “We believe that even though a lot of the viewing is going on-demand and on the Internet, the business model will still be the monthly subscription model,” he said. Copyright issues also arose at Tuesday’s meeting. Engelhart said the country’s copyright laws should be more flexible, and that network personal video recorders (PVRs) would have been prohibited under the last proposed amendments to the Copyright Act in Bill C-61. A network PVR uses a cable company’s servers to host customers’ recordings. Engelhart said the approach is more cost effective and offers more flexibility than devices that store the content. Bill C-61, introduced in 2008, died on the order of paper due to an election. Michael Geist, Canada research chair in Internet and e-commerce law at the University of Ottawa, has said he has information confirming that the Conservative government intends to reintroduce more or less the same bill. Conservative MP Dean Del Mastro, parliamentary secretary to Heritage Minister James Moore, told Engelhart at the committee that he agrees with Rogers’ position. “If the content owners, or creators, and the cable companies can come to an agreement on how they should be reimbursed for that, I can’t understand what the difference is between a network PVR and one on top of the television,” Del Mastro said. Charlie Angus, NDP MP and his party’s digital affairs critic, asked Engelhart whether he is concerned about the ongoing negotiation of the Anti-Counterfeiting Trade Agreement (ACTA). “There is a push to end the safe harbour liabilities for ISPs ,” Angus said. “So one of your customers downloads something and the entertainment industry goes after them. They want to be able to go after you too for not having stopped that.” Engelhart said he is concerned about ACTA. “We don’t think ISPs should be put into the position of being traffic cops to try to decide what is legal and what is not,” he said. Engelhart said Rogers opposes a graduated response approach, or so-called “three-strikes and you’re out” policy, which could see alleged infringers disconnected from their Internet connections. He said the company takes a voluntary notice-and-notice approach, in which the ISP sends cease-and-desist letters to alleged copyright infringing customers, and that the system has worked well so far. Engelhart also told the committee that Rogers supports opening up the telecommunications market to more foreign ownership but that Canada’s foreign ownership restrictions should be preserved for content providers like radio and television stations, and specialty channels. “This would provide the capital intensive distributors lower cost access to foreign capital, while ensuring that vital content producers are Canadian,” Engelhart said. Engelhart also said that, in average revenue per minute, Canada is one of the 10 lowest priced countries in the world for cell phone service—a point that raised the interest of Bloc Québécois MP Carole Lavallée. “Why should we open up the Canadian market to more foreign investment if we’re already one of the lowest-priced countries in the world?” Lavallée told The Wire Report following the meeting. On Tuesday, the committee also heard from Mark Bishop, a partner and producer with the independent television production company Marblemedia Inc. Bishop said Canada’s co-production treaties—which govern international co-productions—must be updated as cross-border agreements become more important to the industry. “Our co-production treaties need to embrace interactive content and interactive platforms,” Bishop said. Bishop agreed with the Canadian Film and Television Production Association (CFTPA), which addressed the committee last week, saying that approval from a Canadian broadcaster should not be necessary to access the Canada Media Fund (CMF) and other funding sources like the Bell Fund, a broadcasting and new media fund with contributions from Bell Canada. “The reality is that the broadcasters control all, as they have the key to unlock the CMF, the Bell Fund, the tax credits and other financial incentives,” Bishop said. jmigneault@thewirereport.ca

Subscription model the most viable way to support television content, says Rogers

Broadcast | May 11, 2010

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us