Zero-rating regime should be similar to ITMP framework: CNOC

GATINEAU — On the first day of the CRTC’s hearing on differential pricing practices, a consortium representing small telecoms asked the CRTC to allow but regulate the practice of zero-rating, though CRTC chairman Jean-Pierre Blais questioned how zero-rated categories would be determined under such a regime. The exchange occurred on the first day of the week-long hearing into differential pricing practices, including the practice of exempting various services from data caps, called zero-rating. Quebecor Inc.’s Videotron’s Unlimited Music Service, which exempts various music streaming services from wireless data caps, prompted complaints to the CRTC in 2015 from opponents who maintain such services violate net neutrality. During the hearing, the Canadian Network Operators Consortium (CNOC) said categories of zero-rated services should include a wide range of “substitutes” in a basket, so that one music streaming service, for example, is not favoured over another. To make such a system work, “regulatory certainty” is needed, the group said. “We’re proposing that ISPs choose their categories,” Matt Stein, chief executive officer of Distributel Communications Ltd. and vice-chairman of the board of CNOC, said to the panel of five commissioners. The group said a regime similar to the CRTC’s ITMP regime should be implemented that would apply equally to all ISPs, which would allow complaints to be filed through Part 1 applications. It would allow ISPs to zero-rate broad categories of content, and to exclude illegal content from those categories. But Blais said that “although you’re also advocating for regulatory certainty, I’m not sure that provides you with a lot of certainty when everybody can decide their own.” Stein replied by stating that the ISPs would adhere to specific principles, with the idea that “people don’t promote their own and receive a specific value…to achieve ideal value for themselves.” But the distinction wasn’t clear to Blais, who asked, “What do you say to somebody that says, a proper category ought to be for all entertainment streaming services and that it’s artificial to make a distinction between music and video?” He said that there is “an arbitrariness to making a distinction between music and non-music,” and brought up the unjust discrimination section of the Telecommunications Act. “Why make a distinction between streaming services and radio services that are high in music content and let’s say a podcast, which isn’t a streaming service, but a subscriber-type service which may actually contain a lot of music?” he asked, noting that CRTC data shows younger Canadians “are consuming a great deal of podcasts.” He also said that ISPs would “piggyback on named brands that are known, like and others.” The panel heard testimony from two other groups —the Canadian Media Concentration Research Project and Sandvine Corp. —and academic Roslyn Layton. Layton argued that differential pricing is an important component for getting low-income users access to services, as well as being valuable to new entrants in the market. “ are nothing more than partnerships,” Layton said on a Skype call from Denmark. The CMCRP argued that the commission should prohibit the practice. It raised particular concern with regard to vertically integrated companies, which it said could theoretically promote their own content properties if allowed to use differential pricing practices. “Zero-rating, sponsored data and similar practices tend to be in fact anti-competitive,” Ben Klass, whose complaint against a mobile-TV service offered by BCE Inc. first brought the issue of zero-rating to the CRTC’s attention in 2013. “They stifle innovation, they represent a power grab on the part of carriers who seem to act as gatekeepers to the Internet. They can impose substantial costs on third-party service providers and they raise concerns regarding people’s privacy.” — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Zero-rating regime should be similar to ITMP framework: CNOC

Broadcast | November 1, 2016

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Zero-rating regime should be similar to ITMP framework: CNOC

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