With the passage of Bill C-11 into law Dec. 12, the ball is now in the CRTC’s court.

The bill amends Canada’s Copyright Act eliminating recourse to a regulatory mechanism known as a compulsory licence, a provision under the Act which allows retransmitters, cable, satellite or potentially Internet, to stream or retransmit over-the-air radio and TV signals without the consent of copyright holders or program licencees.

Overwhelming opposition from audiovisual rights holders to TV signals being widely distributed on the Internet, ultimately led government to revise C-11(introduced as Bill C-48 in December 2001). The bill was prompted by contentious legal and market rights issues related to the launch of iCraveTV in 2000 and later JumpTV.com Canada.

In June 2002, the government asked the CRTC to clarify the whole business.

The commission has options.

It could amend its 1999 Exemption Order for New Media Broadcasting Undertakings and grant retransmitters access to the compulsory licence regime. Some intervenors say this will circumvent C-11. It could leave the Exemption Order unchanged, which in the shorter term would seem to facilitate the development of an orderly rights market, with would-be retransmitters obliged to negotiate directly with copyright holders. Or it could regulate and license retransmitters under the Broadcasting Act, as is the case for cable and satellite broadcast distributors.

A spokesperson for the CRTC says the commission is currently reviewing various technical implications of C-11, but the government had asked for the report by Jan. 17.

Industry response

‘The CRTC should not change its New Media Exemption Order, at least now, and certainly we don’t think they should do so simply to allow Internet companies to get the compulsory licence,’ says Erica Redler, CAB general counsel and senior VP, policy and legal affairs.

‘In 1999, we took the position the CRTC had to regulate with a licence. And we believe we were right. At this point [with the Copyright Act amendment as law] it may not be necessary for the CRTC to reopen the Exemption Order,’ says Elizabeth McDonald, CFTPA president and CEO.

Producers in the APFTQ have asked the commission to move on the issue and place Internet retransmission under the regulatory framework of the Broadcasting Act.

The DGC firmly opposed extending the compulsory retransmission licence to Internet-based retransmitters, but does not favor licensing under the Broadcasting Act at this time. The guild says no regulatory action should be taken which would ‘pre-empt the developing market for the direct exploitation of audiovisual works online. In this area, the CRTC should not prejudge the outcome.’

Redler says BDU contributions to the broadcasting system have justified access to the compulsory licence. ‘What we have said in respect to Internet retransmitters is that they would like all the benefits of not being regulated and also the benefits of the compulsory licence…so they want the benefits but not the burden.’

‘Not against the technology’

McDonald says producers believe ‘the Internet represents great opportunity. What we want to ensure is that the opportunity is there for all the players and that primarily includes the people who create the content.’

‘Often the media portray this as broadcasters and producers, ‘the old guys,’ who want to squash these new businesses,’ says Redler. ‘We are not against the technology at all. We are simply saying the Internet is a new technology, and we know this from the music industry and Napster, that it has associated risks. We believe in the free market. Let’s sit down and make a deal. Let’s not have our signals expropriated, and really, a compulsory licence is a form of expropriation.’

Many of the production and broadcasting industry submissions to the CRTC, including those from the DGC, CCTA, CAB, APFTQ and CFTPA, consider Internet retransmission to be an extremely insecure delivery system. Interventions from the Washington, DC-based National Association of Broadcasters and the Canadian Motion Picture Distribution Association, representing the major U.S. studios in Canada, strongly state there is no credible proof of any existing technology capable of impeding unauthorized third-party distribution, or offering a realistic guarantee of geographical containment.

If U.S. rights holders do not have assurances their programs will not be transmitted over the Internet at large, CAB says they’ll simply ‘cease providing programming to Canadian broadcasters.’

Licensing window agreements between CAB members and Canadian film and TV producers do not include Internet rights. In general terms, producers are not making those rights available.

The only Internet retransmission service currently active in Canada is Aliant Telecom’s high-speed TV on My PC subscriber service, which distributes over-the-air signals from ABC, ATV, Radio-Canada and CBC and a number of Canadian specialty services including MuchMusic and CBC Newsworld. For more information on comments filed electronically concerning over-the-air Internet retransmission go to: www.crtc.gc.ca/Broadcast/eng/NOTICES/2002/2002-38/int.htm

For information on Copyright Act amendment (Bill C-11) go to: www.parl.gc.ca/37/2/parlbus/chambus/house/bills/government/C-11/C-1