CRTC lacks data to make informed decisions on vertical integration: CEP

OTTAWA—The CRTC must take an evidence-based approach to the impacts of cross-media ownership as it looks into vertical integration, the Communications, Energy and Paperworks Union of Canada (CEP) says. “We have learned that the CRTC has spent $2.7 million on consultants and research since 2007,” Peter Murdoch, vice-president of the CEP, told the House heritage committee Tuesday. “Yet … it has not undertaken or commissioned any research on the impact of concentrated ownership, cross-media ownership, or BDU ownership of programming services.” In October, the CRTC announced a new proceeding to study the effects of vertical integration in the communications industry. The announcement was made the same day as the commission approved Shaw Communications Inc.’s acquisition of Canwest Global Communications Corp.’s broadcasting assets. Murdoch told the heritage committee, which is also studying vertical integration, that the CRTC has approved vertical transactions since the early 1980s, yet programming employment, spending on local programs and local broadcast hours have all dropped as industry concentration has increased. “The idea that more concentrated ownership would direct more resources to Canadian programming has been lost,” he said. Murdoch said the problem lies in the commission’s failure to collect information on the impacts of vertical integration. The CEP filed eight access to information requests to the CRTC in 2010 asking for any research undertaken on vertical integration. The union said none of the requests generated documents. Murdoch added that the CRTC does not measure how many news bureaus are in operation in Canada or how many reporters work in broadcasting. “Vertical integration matters because it will affect news diversity, and because Canadians, and democracy, rely on trustworthy and competitive news sources,” he said. “So how can the CRTC or Canadians understand the impact of vertical integration?” Michael Janigan, executive director of the Public Interest Advocacy Centre (PIAC), said in an interview the group’s principal concern is with how the CRTC uses the information it collects. “We think the main difficulty is that the information collected is ignored,” he said. “The communications monitoring report … frequently shows results that are opposite to what was anticipated by decisions of the CRTC and the government.” Janigan said the yearly report shows Canadian consumers aren’t getting the best choices and prices. “So what do we do with that information? Do we just continue to forge onwards?” Janigan added that the CRTC may be not be collecting enough information on certain areas, including service quality. Speaking before the committee, Murdoch also raised issues with how long the CRTC retains its data. In 2008, the CEP filed an access to information request with the commission requesting the annual revenues and expenses of private television stations from 1968 to 1990, but the commission said the data, which is over 10 years old, was destroyed following retention and disposal standards. “Please note that your request is for records that no longer exist, as the CRTC, as of early last year (2008), moved to a 10-year retention period for most records (paper and electronic),” Elsa Van Hulst, the CRTC’s access to information coordinator, wrote in a response to the request in November 2009. Monica Auer, legal counsel for the CEP, said in an interview the CRTC needs to keep data to inform its decisions. “Why would they destroy the electronic data?” she said. “How do you assess the impacts of your policy if you can’t even look at the financial data? … Good policy requires a good evidentiary foundation.” A CRTC spokesperson said the commission is required to keep files for 10 years, after which they can be sent to Library and Archives Canada. Archives can then decide to retain or destroy the evidence based on its historical importance. The CEP also filed a request for data covering the period 1991 to 2000, but the commission said it “will no longer release the information covering years 1990 to 2000.” The request was refused under Section 20(1)(b) of the Access to Information Act, which says the government can refuse to disclose records that contain confidential financial or commercial information supplied by a third party. Auer said to use the exemptions the CRTC must show that there could be demonstrable harm in releasing information. She added that the commission has also refused to release data on companies that have ceased operations. Auer said the difficulty accessing CRTC data makes it hard for groups to prepare for hearings. Murdoch said that under the Broadcasting Act, the CRTC is not required to provide evidence to explain its policies. He said this is problematic because the commission’s policies, unlike its decisions, cannot be appealed. But Sheridan Scott, a partner at Bennett Jones LLP, said in an email the CRTC “has the powers of a court” to subpoena documents and call witnesses. “The CRTC is an expert tribunal and like all other expert tribunals is entitled to deference on matters within its expertise. However that does not mean it is isolated from court review on matters like the charter, natural justice or matters not within their expertise,” she said. David Elder, a communications, competition and privacy lawyer at Stikeman Elliot LLP, said in an interview that collecting information on vertical integration would be labour-intensive for companies. “It does require some work. It does mean that the licensed entities … would have to create these records, and track all of this activity. In many cases, with the type of activity they would be asked to track, there may not be a business reason to do so,” he said. Elder said the commission should strike a balance between collecting information and imposing that need on the industry. He said it’s difficult for the commission to determine which information needs to be tracked. “I would hate to have the CRTC collecting huge amounts of data from the industries that it regulates just because if and when they become valuable they may be useful,” he said. “That puts a huge burden on the commission and on the industry, and there’s a real cost to that in both dollars and personnel.” Elder added that the CRTC’s policy decisions are based on the record put before it during proceedings. “I’m not sure I’d say that there’s no record, basis or rationale for policies. I think they do explain that,” he said. Speaking at the committee, Murdoch proposed the creation of a national, independent policy research institute to undertake quantitative research on regulation and policy. Auer said the new institute could make data more available and require the CRTC to share its research. kfournier@thewirereport.ca

CRTC lacks data to make informed decisions on vertical integration: CEP

Broadcast | December 10, 2010

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