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Broadcasting and Telecom

Thursday July 14, 2011
The Xplornet's Release: Digging into the Documents
Earlier this week, Xplornet Communications Inc. (formerly Barrett Xplore Inc.) issued the following press release in response to my post on the CRTC's net neutrality enforcement: Xplornet Communications Inc., (formerly Barrett Xplore Inc.) is aware that allegations made online by Michael Geist on Friday July 8th, 2011 have been reprinted by various media. The statements made in Mr. Geist's original article omit material information and draw incorrect conclusions regarding Barrett Xplore Inc.'s actions.  Reprinting this blog entry, or Geist's allegations regarding Barrett Xplore Inc. (or Xplornet Communications Inc), represent the publication of materially misleading statements regarding our company. To say I was surprised by the release would be an understatement. Xplornet never contacted me to discuss the post or express concern about its content. The original post did not directly target Xplornet, but rather focused on the CRTC enforcement record. It pointed to complaints against several different providers and listed all complaints I obtained as part of an Access to Information request. With respect to Xplornet, I stated the following:
xplornet comment
Content Country: 
Canada

Earlier this week, Xplornet Communications Inc. (formerly Barrett Xplore Inc.) issued the following press release in response to my post on the CRTC's net neutrality enforcement:

Xplornet Communications Inc., (formerly Barrett Xplore Inc.) is aware that allegations made online by Michael Geist on Friday July 8th, 2011 have been reprinted by various media. The statements made in Mr. Geist's original article omit material information and draw incorrect conclusions regarding Barrett Xplore Inc.'s actions.  Reprinting this blog entry, or Geist's allegations regarding Barrett Xplore Inc. (or Xplornet Communications Inc), represent the publication of materially misleading statements regarding our company.

To say I was surprised by the release would be an understatement. Xplornet never contacted me to discuss the post or express concern about its content. The original post did not directly target Xplornet, but rather focused on the CRTC enforcement record. It pointed to complaints against several different providers and listed all complaints I obtained as part of an Access to Information request. With respect to Xplornet, I stated the following:

NDP Criticizes Google - Verizon Net Neutrality Deal

The NDP has published a release criticizing the Google - Verizon net neutrality deal, expressing concern about the side deal.  The deal treats wired and wireless services in a different manner, something the CRTC has rejected as part of its traffic management guidelines.

Wednesday July 7, 2010
Federal Court of Appeal Rules ISPs Not Broadcasters: May Be End of ISP Levy Proposal
The Federal Court of Appeal issued is decision today [not online yet] on whether Internet providers can be considered broadcasters within the context of the Broadcasting Act.  The case is the result of last year's CRTC New Media decision in which many cultural groups called on the Commission to establish an ISP levy to fund Canadian content.  The ISPs argued that such a levy was illegal since they fell under the Telecommunications Act, not the Broadcasting Act.  The cultural groups argued that ISPs should be considered broadcasters in the case of the transmission of video programs.  The CRTC punted the issue to the Federal Court of Appeal. The Federal Court of Appeal sided with the ISPs, ruling that providing access to broadcasting is not the same as broadcasting.  So long as ISPs maintain a content-neutral approach, they fall outside of the Broadcasting Act and should not be expected to play a role in promoting the policies found in the legislation.  The case is a huge win for the ISPs and - subject to an appeal to the Supreme Court of Canada or a legislative change - puts an end to the ISP levy proposal.  The case is also noteworthy from a net neutrality perspective, since the court emphasized that ISPs fall outside the Broadcasting Act so long as they remain content-neutral.  Should ISPs play a more active role, their ability to rely on the broadcast/transmission distinction would be lost.

The court set out the issue as follows:

the issue to be decided is whether, when providing access to the "transmission of programs ...", ISPs are broadcasting. The answer to this question hinges on a consideration of the findings of the CRTC as to how programs are transmitted on the Internet on the one hand, and the exact purport of the definition of the word "broadcasting", on the other.

The conclusion, which relied heavily on the Supreme Court of Canada Tariff 22 decision between SOCAN and the Canadian Association of Internet Providers:

Relying on the logic adopted by Binnie J. in CAIP in construing the word "communicate" under the Copyright Act, I am of the view that the definition of "broadcasting" is also directed at the person who transmits a program and that a person whose sole involvement is to provide the mode of transmission is not transmitting the program and hence, is not "broadcasting".

As for promoting the Broadcasting Act objectives, the court stated:

Because ISPs' sole involvement is to provide the mode of transmission, they have no control or input over the content made available to Internet users by content producers and as a result, they are unable to take any steps to promote the policy described in the Broadcasting Act or its supporting provisions. Only those who "transmit" the "program" can contribute to the policy objectives.

Finally, the comment that puts net neutrality back on the table:

In providing access to "broadcasting", ISPs do not transmit programs. As such, they are not "broadcasting" and therefore they do not come within the definition of "broadcasting undertaking". In so holding, I wish to reiterate as was done in CAIP that this conclusion is based on the content-neutral role of ISPs and would have to be reassessed if this role should change (CAIP, para. 92).

The court set out the issue as follows:

the issue to be decided is whether, when providing access to the "transmission of programs ...", ISPs are broadcasting. The answer to this question hinges on a consideration of the findings of the CRTC as to how programs are transmitted on the Internet on the one hand, and the exact purport of the definition of the word "broadcasting", on the other.

The conclusion, which relied heavily on the Supreme Court of Canada Tariff 22 decision between SOCAN and the Canadian Association of Internet Providers:

Relying on the logic adopted by Binnie J. in CAIP in construing the word "communicate" under the Copyright Act, I am of the view that the definition of "broadcasting" is also directed at the person who transmits a program and that a person whose sole involvement is to provide the mode of transmission is not transmitting the program and hence, is not "broadcasting".

As for promoting the Broadcasting Act objectives, the court stated:

Because ISPs' sole involvement is to provide the mode of transmission, they have no control or input over the content made available to Internet users by content producers and as a result, they are unable to take any steps to promote the policy described in the Broadcasting Act or its supporting provisions. Only those who "transmit" the "program" can contribute to the policy objectives.

Finally, the comment that puts net neutrality back on the table:

In providing access to "broadcasting", ISPs do not transmit programs. As such, they are not "broadcasting" and therefore they do not come within the definition of "broadcasting undertaking". In so holding, I wish to reiterate as was done in CAIP that this conclusion is based on the content-neutral role of ISPs and would have to be reassessed if this role should change (CAIP, para. 92).

federal court on isp as broadcasters

The Federal Court of Appeal issued is decision today [not online yet] on whether Internet providers can be considered broadcasters within the context of the Broadcasting Act.  The case is the result of last year's CRTC New Media decision in which many cultural groups called on the Commission to establish an ISP levy to fund Canadian content.  The ISPs argued that such a levy was illegal since they fell under the Telecommunications Act, not the Broadcasting Act.  The cultural groups argued that ISPs should be considered broadcasters in the case of the transmission of video programs.  The CRTC punted the issue to the Federal Court of Appeal.

The Federal Court of Appeal sided with the ISPs, ruling that providing access to broadcasting is not the same as broadcasting.  So long as ISPs maintain a content-neutral approach, they fall outside of the Broadcasting Act and should not be expected to play a role in promoting the policies found in the legislation.  The case is a huge win for the ISPs and - subject to an appeal to the Supreme Court of Canada or a legislative change - puts an end to the ISP levy proposal.  The case is also noteworthy from a net neutrality perspective, since the court emphasized that ISPs fall outside the Broadcasting Act so long as they remain content-neutral.  Should ISPs play a more active role, their ability to rely on the broadcast/transmission distinction would be lost.

CRTC Extends Net Neutrality Rules to Wireless Data Services

It did not attract much attention, but last week the CRTC ruled that it is extending its Internet Traffic Management Practices framework to wireless data services.  The ITMP framework address some net neutrality concerns.  The CRTC had previously indicated that it expected wireless companies to comply with the framework, but the decision (which is effective immediately) provides a stronger legal foundation on the issue.

Garneau on a Canadian Digital Strategy

Liberal Industry critic Marc Garneau has published an op-ed on the need for a Canadian digital strategy.  Garneau calls out the lack of action on connectivity, universal access, net neutrality, and intellectual property reform.

Friday October 30, 2009
Liberals Call for Better Internet and Wireless Competition, Net Neutrality
The Liberals have issued a noteworthy release calling for better competition and service for wireless and Internet services in Canada.  The party says there is a real competition problem that calls for "concrete proposals to lower prices and improve cell phone and Internet service for urban and rural Canadians." The specific recommendations include: clear guidelines to facilitate tower-sharing and roaming agreements for new entrants re-instating the cellphone cost calculator to provide greater transparency adopt clear net neutrality principles and regulations.  The proposed neutrality principles include "all internet networks, including wireless networks, must treat all lawful content, applications and services in a non-discriminatory manner."  The policy also calls for full disclosure of network management practices new regulations for wholesale Internet services and encourage investment in Internet infrastructure The release demonstrates the increasing political attention to digital economy issues and mounting concern over Canada's lagging performance.  Given yesterday's CRTC decision involving Globalive, it would be useful for the party to state its position on foreign ownership restrictions for telecom providers as there is an urgent need to address the issue of injecting new competition into the Canadian marketplace.
liberals on internet and cellphone competition

The Liberals have issued a noteworthy release calling for better competition and service for wireless and Internet services in Canada.  The party says there is a real competition problem that calls for "concrete proposals to lower prices and improve cell phone and Internet service for urban and rural Canadians." The specific recommendations include:

  • clear guidelines to facilitate tower-sharing and roaming agreements for new entrants
  • re-instating the cellphone cost calculator to provide greater transparency
  • adopt clear net neutrality principles and regulations.  The proposed neutrality principles include "all internet networks, including wireless networks, must treat all lawful content, applications and services in a non-discriminatory manner."  The policy also calls for full disclosure of network management practices
  • new regulations for wholesale Internet services and encourage investment in Internet infrastructure

The release demonstrates the increasing political attention to digital economy issues and mounting concern over Canada's lagging performance.  Given yesterday's CRTC decision involving Globalive, it would be useful for the party to state its position on foreign ownership restrictions for telecom providers as there is an urgent need to address the issue of injecting new competition into the Canadian marketplace.

Storm Clouds Ahead for Canadian Wireless World

Teaser: 
Appeared in the Toronto Star on March 9, 2009 as Storm Clouds Ahead for Wireless World Public frustration over the state of the Canadian wireless industry has generally focused on consumer-oriented concerns including pricey data plans, misleading system access fees, and text message charge policies.  Given the consumer focus, the effect on Canadian business is rarely discussed.  That is set to change as one of Canada’s leading media companies has stepped forward with explosive allegations about how the wireless industry is engaged in practices that stifle innovation by privileging access or controlling content on their networks. The claims can be found in a recent submission to the Canadian Radio-television and Telecommunications Commission by Pelmorex Media, the owner of the Weather Network in Canada.  While Pelmorex is not a household name, the Weather Network's websites rank at the top of Canadian media websites for online visitors. Pelmorex wrote to the CRTC as part of the Commission's ongoing network management proceeding and was one of the few to focus on the management of wireless networks.  Although the submission does not name names, it claims that Canadian wireless carriers routinely impose restrictions on the ability of content providers to deliver advertising as well as restrict or charge more if a customer accesses that advertising.  These restrictions undermine the profitability of mobile websites. Moreover, Canadian carriers have established "walled gardens" that feature preferred content.  When consumers seek access to alternative content, they typically face higher charges. The submission points to the following specific incidents that Pelmorex says it has experienced first hand: wireless reseller blocking ads from mobile sites wireless carriers stripping out tracking codes embedded in web pages, thereby limiting ability to deliver ads wireless carriers establishing "walled gardens" that provide preferential access that reduces data charges for sites within the walled garden wireless carriers forcing users to use the wireless carrier homepage when accessing the Internet on feature phones wireless carriers demanding prior approval of applications for use on smart phones wireless carriers imposing additional fees for text messages that include advertisements wireless carriers limiting to whom ads in text messages may be sold The net effect of these practices dampens the potential for online innovation and has a negative impact on mobile electronic commerce in Canada.  This comes at a particularly bad time, since the mobile Internet has just begun to gain broad consumer acceptance with some Canadian media companies advising the CRTC that traffic to their mobile sites is now nearly equal to visits to their fixed Internet sites. The global community is starting to take note of Canada's declining standing with regard to wireless networks and information technology.  Last week, the International Telecommunications Union released its latest ICT Development Index that saw Canada drop from 9th worldwide to 19th - the sharpest drop among countries ranked in the top 50 worldwide.  While there are several reasons for the decline, the virtual absence of competitive mobile broadband services in Canada was a key factor. Canadian government officials have to date expressed little interest in wireless net neutrality, in contrast to the U.S., where the issue has been the subject of regulatory hearings, petitions to the Federal Communications Commission, and worked its way into spectrum policy arena. The CRTC is conducting hearings on net neutrality this summer, though it is not certain whether the Commission will adopt an expansive view of the issue to include both wired and wireless concerns.  If the Pelmorex allegations are accurate, putting wireless concerns on the agenda is likely to lead to some stormy conditions in the months ahead. Michael Geist holds the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa, Faculty of Law. He can reached at mgeist@uottawa.ca or online at www.michaelgeist.ca.
Date Published: 
Monday, 9 March 2009
Publisher: 
Toronto Star
Description: 
pelmorex column
Wednesday February 18, 2009
Smart Pipes vs. Dumb Pipes
While the early focus of the CRTC New Media hearings are unsurprisingly focused on levies and regulation, an important additional issue is quickly emerging.  CRTC Chair Konrad von Finckenstein tried to set the stage for the hearings by noting that they are limited strictly to new media broadcasting.  He then followed with a question to Alain Pinot of the CCA in which he stated that he does not see the relationship between this hearing and the network management hearing. Von Finckenstein's comments come on the heels of the comment from Rogers over the weekend that they run a "dumb pipe" with respect to content.  It seems to me that the comments are related as they present a vision that puts content in one box (new media hearings and the Rogers dumb pipe) and network management in another (net neutrality hearings and a smart pipe/traffic shaping).  I think this is wrong and points to key question.  To use Rogers' terminology - can an ISP that engages in active network management but does not directly filter content be said to run both a smart pipe (the network management) and a dumb pipe (for content)? I think the answer is no - current network management necessarily leaks into content and cannot be said to be a dumb pipe.  
First, it is clear that the deep packet inspection technologies employed by ISPs may already leak into content management.  The expert report on DPI for the CRTC lists the following uses:
  • Off-line tool to analyze network traffic
  • Identify and block or shape P2P traffic
  • Handle security threats or nuisances such as Distributed Denial of Service (DDoS) attacks
  • Service tiering and premium service control
  • Parental control & URL filtering
  • Personalized advertising, targeted service offers etc
  • Third party service management
I would argue that this list already involves content management including URL filtering, personalized advertising, and targeting service offers.  All of these services can have an effect on the end-user's experience and is not consistent with a dumb pipe.

Second, the ongoing talk of traffic prioritization based on a particular website (ie. fast lane vs. slow lane) is quite obviously not a dumb pipe for content purposes.  If ISPs move in that direction (as many have openly speculated), there will be little doubt that network management and content management will have merged.

Third, it is important to recognize that degrading bandwidth on certain applications necessarily has a spillover effect on content.  In other words, you cannot have a smart pipe for applications and a dumb pipe for content.  The application at issue is BitTorrent, which Rogers and many other ISPs believe can be degraded without having an effect on the content itself.  From a competitive perspective, this is wrong since BitTorrent distribution can/does compete with other on-demand video services.  By degrading one form of distribution, the other is clearly advantaged.  Moreover, the degrading of BitTorrent can arguably "influence the meaning and purpose of the telecommunications" since the slower speeds will have an effect on how the end-user ultimately experiences the content that they are trying to access.

This inability to distinguish between content and application is obvious in the telecommunications space where ISPs do not need to censor the voice conversation to have an effect on the content of the communication.  If an ISP were to degrade an Internet telephony service, it would clearly raise competitive concerns (favouring its own VoIP or landline service) and would have an effect on the quality of the communication itself, thereby making it difficult to communicate the content.  The impact is clear even if the ISP does not block or censor the actual conversation.   The same is increasingly true for broadcast-style content, where the content itself may not be strictly censored or blocked, but the degrading of the communication of the content may still have an undesirable impact.

This issue provides one reason why net neutrality legislation is needed in Canada.  The CRTC looked at it in the Bell throttling decision, ruling that throttling does not have an impact on content in violation of the Telecommunications Act.  If the CRTC stands by the decision that such actions are consistent with current law, the solution may well be to change the law.

Moreover, this merging of content and application is why the issue cannot be easily dismissed in the new media hearing.  When the CBC or a Canadian film maker uses BitTorrent to distribute their content, the ability for Canadians to access that content on an equal footing with other distribution models depends upon a net neutral Internet and should be seen as a key policy tool to ensure that Canadian creators enjoy equality of access.  It goes without saying that it is also why Rogers cannot claim to have a dumb pipe in February and smart one in July.
smart pipe vs. dumb pipe
While the early focus of the CRTC New Media hearings are unsurprisingly focused on levies and regulation, an important additional issue is quickly emerging.  CRTC Chair Konrad von Finckenstein tried to set the stage for the hearings by noting that they are limited strictly to new media broadcasting.  He then followed with a question to Alain Pinot of the CCA in which he stated that he does not see the relationship between this hearing and the network management hearing. Von Finckenstein's comments come on the heels of the comment from Rogers over the weekend that they run a "dumb pipe" with respect to content. 

It seems to me that the comments are related as they present a vision that puts content in one box (new media hearings and the Rogers dumb pipe) and network management in another (net neutrality hearings and a smart pipe/traffic shaping).  I think this is wrong and points to key question.  To use Rogers' terminology - can an ISP that engages in active network management but does not directly filter content be said to run both a smart pipe (the network management) and a dumb pipe (for content)?

I think the answer is no - current network management necessarily leaks into content and cannot be said to be a dumb pipe.  
Monday December 8, 2008
CRTC New Media Hearing: The Three Battleground Issues [Updated]
Friday was the deadline for written submissions to the CRTC's New Media hearing and the Commission has already posted filings from nearly 100 individuals and organizations [now nearly 150 submissions].  While there are some noteworthy side copyright issues (the CMPDA - the Canadian arm of the MPAA - is concerned that dropping the new media exception would bring back iCraveTV and the legality of Internet retransmission, while CRIA implausibly argues without any evidence that "one of the factors that has significantly restricted legitimate Canadian broadcasting content being delivered and accessed over the Internet is the proliferation of unauthorized file swapping and downloading"), the real fight in the February hearings will come down to three issues:

1.   The ISP Levy.  Several creator groups unsurprisingly argue for a new levy on ISP subscribers to fund the creation of Canadian new media.  ACTRA assumes the lead role in this regard, seeking 3 percent of ISP broadband revenues and 0.6 percent of wireless service provider revenues.  The proposed levy is opposed by many groups including telecommunications companies and the Competition Bureau.  The telecom companies include a paper written by MIT's David Clark and William Lehr and Rogers offers a rebuttal from Suzanne Blackwell and a legal opinion from Faskens. [update: Shaw has submitted two legal opinions - one from former Supreme Court of Canada Justice Frank Iacobucci, now with Torys, on the legality of the levy and another from Stikemans on the right to regulate new media].

2.   The New Media Regulatory Exemption.  Many submissions call on the CRTC to continue the regulatory exemption for new media, including the wireless industry, Google, telecom industry, the NHL, and the broadcasters.  On the other hand, ACTRA and SOCAN lead the charge for a new, highly regulated Internet.  SOCAN's vision is astonishing, calling for at least 51 percent Canadian content requirements for Canadian commercial websites.  ACTRA calls for full Cancon rules for new media and wants the CRTC to licence new media undertakings, arguing that "the Commission should also require that those who are making programs available from Canada, through the Internet or to mobile receiving devices, for viewing at a time and place chosen by the user be licensed."  Note that ACTRA also believes that user generated content should regulated under the Broadcasting Act. [update: The CBC has called for the CRTC to regulate new media content aggregators, while Sirius satellite radio wants Internet radio delivered to mobile devices to face new regulation.]

3.   Net Neutrality.  The link between new media and net neutrality has clearly resonated with a large number of groups.  While the telecommunications companies do not touch the issue, many groups express concern about a non-neutral Internet.  These include ACTRA, CIRPA, the Canadian Music Publishers Association, the Canadian Conference of the Arts (which argues that the New Media hearings should be delayed to coincide with the net neutrality hearing), Stornaway Communications, and Pelmorex Media.[update: the list of net neutrality supporters continues to expand with the Maple Leafs Sports and Entertainment , Score Media, and the Documentary Organisation of Canada all on board].

crtc new media

Friday was the deadline for written submissions to the CRTC's New Media hearing and the Commission has already posted filings from nearly 100 individuals and organizations [now nearly 150 submissions].  While there are some noteworthy side copyright issues (the CMPDA - the Canadian arm of the MPAA - is concerned that dropping the new media exception would bring back iCraveTV and the legality of Internet retransmission, while CRIA implausibly argues without any evidence that "one of the factors that has significantly restricted legitimate Canadian broadcasting content being delivered and accessed over the Internet is the proliferation of unauthorized file swapping and downloading"), the real fight in the February hearings will come down to three issues:

Friday November 21, 2008
The Meaning of the CRTC Decision
Mirko Bibic, Chief Regulatory Officer, Bell: "With this decision, the Commission has rightly confirmed that network operators are in the best position to determine how to operate their networks effectively and efficiently, to allow fair and proportionate use of the Internet by all users." Len Katz, Vice-Chair, CRTC: "Someone told me Bell put out a press release that said the commission upheld its position that network management practices are a fundamental right of theirs. That's not what we said at all."
bell v. crtc on decision
Mirko Bibic, Chief Regulatory Officer, Bell:

"With this decision, the Commission has rightly confirmed that network operators are in the best position to determine how to operate their networks effectively and efficiently, to allow fair and proportionate use of the Internet by all users."

Len Katz, Vice-Chair, CRTC:

"Someone told me Bell put out a press release that said the commission upheld its position that network management practices are a fundamental right of theirs. That's not what we said at all."
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