“A Level Playing Field is Not Enough”, Bell Tells CRTC During Online Streaming Act Hearing

A transcript is now available of some of the CRTC hearings on the Online Streaming Act. It shows how entitled Bell feels.

Earlier this week, we noted some of the comments made by Bell at the hearings on the Online Streaming Act. Some of the most asinine comments in this debate can be sourced to Bell. One example is that in order to tell Canadian stories, companies like Bell must be able to more cheaply re-broadcast American programming. It’s a call so ridiculous, it’s hard to even figure out where to begin with that. While our initial report on some of the more recent comments came from media reports, Freezenet has now obtained a transcript of the actual hearing. As a result, we got to read the absurd calls unfiltered.

The transcript in question can be found here. We already knew that Bell seems to be under the impression that the CRTC, if not, the whole world, is there to serve their own business interests. What’s more, Bell has been pushing to be a gatekeeper for all content and skimming money off out of such deals. However, reading the transcripts show just how naked such calls are. Part of the opening remarks is filled with the usual “sky is falling” comments:

825 We have long called on the government to provide a level playing field with streaming services. That said, a level playing field is not enough if traditional broadcasters are no longer financially viable.

826 Canada’s traditional broadcasters are in trouble and I think you heard a lot about this yesterday from Québecor TVA who gave you all sorts of statistics which I don’t intend to repeat here. Given the declines in revenue we are facing, the onerous obligations the CRTC imposes on us are simply too much. The Policy Direction tells you to take action on this point by minimizing the regulatory burden.

827 We are frustrated because, frankly, we do not believe the CRTC is adequately addressing this reality. It took an emergency application by Corus to see any movement on these issues.

Now, it can be easy to read such comments and be lead to believe a scenario where an underfunded broadcaster is unable to produce content that keeps up with a powerhouse foreign entity. Such an angle might actually garner some sympathy. The thing is, Bell is also one of the three major internet providers in Canada and has reaped the benefits of being one of the three entities that charges some of the highest cell phone rates in the developed world. In fact, Bell has, in the past, been singled out for raising their rates at one point. There is little doubt that Bell is a vertically integrated conglomerate that owns news broadcasts, a major internet provider, and a major cell phone provider that owns several differently branded cell phone providers.

Yet, here they are, running cap in hand to the government claiming poverty despite being part of multiple triopolies in this country. Further, when this company talks about trying to make it as a broadcaster, they’re not actually talking about producing their own content and just not having the budgets to compete with foreign businesses. No, what they are complaining about is being able to more cheaply rebroadcast American programming – this while saying that this activity is done in the name of telling Canadian stories. I’m not joking:

835 Traditionally, Bell Media has used the revenues generated by airing U.S. content on our networks to invest in Canadian content and news ‑‑ a form of “cross‑subsidy”. Now, U.S. content is more difficult to access than ever as intense competition drives up prices, assuming U.S. studios are even willing to sell it to a Canadian broadcaster. Instead, U.S. studios are selling their content directly to Canadian consumers through their own streaming platforms, putting our ability to fund Canadian content and news at risk.

836 For example, the streaming rights for the Star Trek franchise have moved from Crave to Paramount+.

837 Canadian content is a crucial factor in defining our national identity and culture and helps us to stand out on the world stage.

Uh, what? Here’s Bell talking about how crucial it is to produce Canadian content, yet just got through bemoaning the fact that they will no longer be able to rebroadcast Star Trek which is… an American program. So much for being there to produce compelling Canadian made content. Nope, it’s all about Star Trek among other things. It’s a completely absurd argument to make. Yet, this is the kind of argument they are making.

One thing that we did note in our earlier report is that Bell wants to siphon money from this legislation and funnel it towards news operations – operations that have little to do with the Online Streaming Act. That was brought up here:

858 First, as Suzane mentioned, the funding model should include a news fund. We have proposals in this regard, which we would be happy to expand on in questioning.

As I mentioned in a previous article, the Online News Act is teetering towards failure. Facebook already dropped news links and Google is likely to follow suit next month. So, the Online News Act appears to be the lobbyists backup plan – and they are now trying desperately to play that card here. It doesn’t make any sense that this piece of legislation should be used to fund news broadcasts, though.

This is, after all, about the production of general content and entertainment. We’re focusing on platforms like Netflix, Disney+, YouTube, TikTok, and many others with this new law. News is a completely separate thing. After all, is there a difference between a news report on an international conflict regurgitated from CNN and someone’s standup comedy routine that the comedian posted online? Obviously, those two types of content are worlds apart with, very often, extremely different purposes. So, why should a platform – especially a platform whose primary purpose is not news related – be responsible for subsidizing the news – especially news produced by a massive vertically integrated corporation? There’s just no sense in that.

The thing is, if you thought these comments are ridiculous already, then you might be surprised that it just kept going:

861 We understand that the direct‑to‑consumer part of Crave will eventually be subject to contribution requirements, the same as foreign streamers. That being said, these new obligations for foreign streamers should not apply to Crave until there is regulatory relief for traditional broadcasters. Crave and other Canadian online undertakings connected to licensed broadcasters already have a heavy burden today in terms of financing regulatory requirements. Imposing obligations on online undertakings affiliated with traditional broadcasters will make things worse for us in the interim, at a time when further regulatory burden is the last thing our industry can bear.

If anyone out there, despite all of the above, was still under the impression that Bell is all about producing and promoting Canadian content, those comments by Bell should pretty much kill any lingering thoughts that producing and promoting Canadian content was Bell’s objective. Here, they are demanding that regulatory burdens should be lifted. What are some of these regulatory burdens? Burdens that involve promoting and producing Canadian content. Bell has long been calling for the regulations to be changed so they won’t have to promote and produce Canadian content. Back in June, they were very direct about this. Bell seemingly feels that they should be above the rules and that foreign platforms should have all the regulatory burdens in this country, not them.

Let’s face it, at the end of the day, if we are talking about how we tell Canadian stories, then the last thing anyone should be advocating for is how to weasel out of requirements to promote said content. This especially after this same company is whining that they can’t rebroadcast Star Trek anymore – a decidedly American produced program. Bell is gunning to be one of the ultimate gate keepers for content consumed by consumers. That horse has left the barn decades ago – especially with the advent and widespread adoption of the internet. No amount of regulatory requirements is going to put that genie back in the bottle. So, really, the only real solution Bell has in all of this is to get off their lazy butts and produce content people want to watch.

Questions and Answers

So, the CRTC had a series of questions and answers. The first exchange was actually quite eyebrow raising in its own right:

864 I will kick things off for the Commission and I have some higher‑level questions. Then I will turn it over to my colleagues, who will have some follow‑up questions.

865 You have used a variety of terms to describe the situation for traditional broadcasters. You’ve said that the Canadian broadcasters are in crisis. You’ve said it’s a dire reality. You said this morning that Canadian broadcasters are suffering. Can you talk to us about what that means for the Canadian broadcasting system and what that means for Canadians? Talk to us a little bit about the impact.

868 MR. STOCKMAN: As of today, Canadian broadcasters and their affiliated streaming platforms are basically the only source of Canadian content created by and for Canadians. Without us representing our country back to itself, what would the effect be on our culture?

OK, so obviously, this is false. Bell doesn’t have a monopoly on telling Canadian stories. There are many many many creators online that are Canadian producing Canadian made content. Examples include Linus Tech Tips, Darcy & Jer, or even Skyship Entertainment. We’re not talking about some random people on the internet, we are talking about Canadian people and organizations that have achieved huge success. So, not only is Bells assertion that they “are basically the only source of Canadian content” is not only blatantly false, but downright offensive as well.

We then get to this:

870 These streamers have taken a lot of our audience and are not contributing at all to culture and as of yet have produced very little of Canadian content.

So, again with the falsehoods here. First of all, a number of streaming services like TikTok and YouTube have provided a new outlet for pretty much any Canadian. Anyone can go onto YouTube and use their services to reach an audience all over the world. As far as I’m concerned, this alone contributes significantly to Canadian culture. For another, streaming services like Netflix have a big reputation for spending big in Canada. For example, Netflix invested half a billion dollars in 2017. Up until this year, Disney+ was also investing heavily into Canada only to pull those investments in response to the Online Streaming Act. HBO’s TV series, The Last of US, continues to make headlines for being a series filmed in Canada. To suggest that foreign streamers and production companies don’t invest in Canada in any way just doesn’t hold with even minimal scrutiny. What’s more, Bell complaining about not being able to broadcast Star Trek only further highlights this corporate hypocrisy.

Bell would then go on to say that being unable to rebroadcast American programming is really hurting their chances of telling Canadian stories:

885 The reason why things aren’t viable is ‑‑ part of it is obvious, right? I always describe there’s three things that are happening in the media industry for broadcasters in terms of making it.

886 The first one is obviously we’re losing customers who are viewing and switching to streaming and on demand, and we’re trying to meet them there by entering into that market as well.

887 The second one is as a result of the streamers entering the market, it’s more expensive to buy content. We compete because before ‑‑ and I think there was a reference to his yesterday. Before, you know, we would have to compete with only other Canadian broadcasters. Now, you have to compete with streamers as well and so it becomes more expensive to be able to buy content.

888 But the third one, which is a lesser known one, is also extremely important. It’s the inability ‑‑ and Justin made reference to it ‑‑ it’s the inability to even buy the content that we used to have in the first place. And why is that? Because the studios, the U.S. foreign studios are now keeping that content from the sell stuff they used to sell to us by saying, “No, we don’t want to sell that to you because we want to save it for our own streaming service.” And we have started to see shows that we used to carry leave our network altogether or sometimes we only get the linear rights.

Or… maybe.. just maybe… you’re producing content people don’t want to watch? Has that ever entered into the equation at all?

I mean, for instance, The Amazing Race Canada originally seemed like an interesting concept. When the first season hit, I though they were going to be travelling around the world like the American counterpart, but it wasn’t even that for the most part. They were basically just racing across Canada which… almost defeats the purpose of the show in the first place. Future seasons only briefly went outside of the country before quickly slipping back into Canada after. I can tell you one thing, if the American version just travelled across the United States, it probably wouldn’t be anywhere near as successful as it wound up being.

Then, to top it all off, the Canadian counterpart was just wall to wall sponsorships and advertising. “Players must get in their [sponsored auto-manufacturer car], the most versatile vehicle in it’s class with 0% financing and…”. Another one might be something along the lines of, “Teams must now buy this bobble-head using [insert credit card], the travellers credit card of choice [blah blah] in order to get their next clue.” Is it really any surprise why I stopped watching by the time we got part way through the third season? YouTube ends up providing far better entertainment then a knock-off gimmick show that is an obvious cash grab.

Bell has no problem saying how they have all the best programming in the world that competes on the world stage. If that is the case, then why are they even here at the CRTC claiming poverty? Both concepts can’t be true. Either Bell has the best programming ever and this claims of being in dire straits are completely made up, or, their programming is garbage and they are in dire straits because they are bad at reading their audiences. My experience with watching The Amazing Race Canada has me believing that the latter is more likely true here.

Either way, Bell has straight up admitted that their content can’t compete on the world stage – a nut that digital first creators in Canada have already cracked, interestingly enough. As Bell keeps complaining that they can’t buy foreign programming to rebroadcast over their own networks, it is becoming clear that this isn’t about “levelling the playing field” in the slightest. This is about creating a regulatory framework that heavily favours legacy players and keeps out any competition whatsoever. I’m not convinced players like Bell want to produce content people want to watch. I’m more convinced that they want to cheap out as much as possible and cash out wherever possible, rather than go through the work of building a globally respected brand. That idea follows everything that was said by Bell up to this point.

To further compound these points, here’s what Bell said right after:

889 And so, all of these are the aspects of what is happening in the market. Advertisers are moving away. And so within all of these dynamics, the traditional broadcaster is really, really struggling to figure out what you do. And obviously, we want to meet the viewer where they’re going, and that is moving to streaming services and so on, but at the same time we want to continue to provide all of the things that we do.

Kind of tells you everything you need to know, right? If advertisers are moving away, it means audiences are moving away. Why are audiences moving away? They are simply going to a better product. Being as cheap as humanly possible on a product and expecting to be successful is increasingly something that’s going to be left in the past. You are in a digital global marketplace and if the effort to producing content isn’t there, the audiences are just going to move on to someone who clearly is putting that effort into their product. It’s that simple.

Bell then went on to lament how news isn’t being subsidized by a completely different industry:

893 You have clearly suggested that there is a sense of urgency here. How would you respond to some of what we’ve heard on the public record, including yesterday afternoon, that there is no sense of urgency in particular with respect to this hearing in terms of putting in place an initial base contribution and that the CRTC should take the two years, do a comprehensive review and then as part of that look at the initial base contribution?

894 MR. DANIELS: Thank you very much for that question. I really do mean thank you for that question because yesterday, as we were sitting there listening to the MPA present their position, it was ‑‑ let’s just say that it got a number ‑‑ I’m sure we weren’t the only ones watching, going, “What are they talking about” in terms of the blood rushing.

895 The first point I know is that we have come to you and hopefully we will get to talk to some details about what our proposals are in this regard about news. You have just heard the description of the crisis in news, that Bell Media alone is losing $40 million a year and that just can’t continue.

896 The interesting thing is yesterday when MPA was appearing, I never heard the word “news” once ‑‑ not once when they talked about the urgency and all that they do and every description. Now, of course they don’t make news and no one is asking them or expects them to do news. That’s not what we are saying. There was even a question from the Commission yesterday where there was a reference to news and the answer avoided it. And so I know that you have the opportunity to raise it again, because apparently they are coming back on an individual basis and so they can address it then.

Uh, maybe the reason why an organization didn’t mention “news” once in this hearing is because news isn’t really that relevant to the Online Streaming Act. You want to talk about news bailouts or platforms paying for news, then lets discuss the impending disaster that is the Online News Act. You want to talk about entertainment and streaming, we can talk about the Online Streaming Act. I’m not sure why Bell can’t figure out that these are two very different debates here. If anything, when I’m reading the transcript, I’m looking at Bell and saying, “What are they talking about”?

If you want to keep reading the absolute mind-boggling nonsense, the transcript is here. Note that the French isn’t translated to English, so you might have to use a translator to get a sense of what was said.

As far as I’m concerned, Bell’s appearance was a disaster. It could be summed up with, “My crappy programs aren’t selling and I can’t cheaply rip American programs and ship them over Canadian airwaves! Something must be done so I can continue mooching off the system forever!” This is before you even get the chance to add context which only adds the need of giving Bell a facepalm here. Even if Bell gets everything they want, they aren’t going to be satisfied with the results anyway when Canadian’s start realizing that they can more cheaply pay for a VPN and get their programs at discounted rates. You can’t expect to force Canadians to watch bad programming forever and be happy with it. So, the ask for regulators to cover their shortcomings by heavily tilting the market into their favour is just going to backfire sooner or later.

Drew Wilson on Twitter: @icecube85 and Facebook.

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