The CRTC released the results of its first fact finding exercise, examining over-the-top (OTT) video services [press release, full report].
The results are said to be inconclusive, but the Commission plans to continue to monitor the file, planning another review to be launched next May – about a year after the initial review. Its key findings:
- The traditional broadcasting system continues to support Canadian programming even as services emerge to deliver content to Canadians in new ways.
- While consumption of online and mobile programming is growing, current measurement tools are unable to accurately reflect trends in consumer behaviour.
- There is no clear evidence that Canadians are reducing or cancelling their television subscriptions. Online and mobile programming appears to be complementary to the content offered by the traditional broadcasting system.
- Canadian creators are taking advantage of the digital environment to produce innovative content and to reach Canadian and global audiences. Canadian broadcasters and distributors are also launching their own online and mobile programming services.
- Some online programming services have established viable business models and are competing in the marketplace for programming rights and viewers.
- Internet and wireless networks may encounter capacity constraints and be challenged to support increasing consumption of media content.
The CRTC’s conclusion went beyond what was generally reported. The Commission said that the parties that called for regulatory obligations to be imposed on providers such as Netflix had successfully demonstrated that consumer adoption of OTT services is real and growing. But, they did not submit evidence that this adoption was actually harming the traditional broadcast system.
The Commission considers that the record of the fact-finding exercise demonstrates that significant change is under way in the communications sphere, with potential for further change. New technologies, service providers and consumer behaviour underpin a transformation that is characterized by greater choice, a global marketplace and new opportunities for Canadian creators. Such change is also creating uncertainty with respect to established business models and associated support for the creation and presentation of Canadian content, as well as for investment and innovation in advanced communications infrastructure.
The Commission intends to conduct another fact-finding exercise in May 2012 to see if any of the scenarios of potential regulatory impacts show signs of materializing. The results of that exercise would be expected around this time next year, at which time the CRTC might then continue to watch the file or consider launching a review of the New Media Exemption Order [as recently affirmed] or launch a review of potential policy changes to increase the regulated players’ flexibility to respond to the activities of OTT providers. Those reviews could only get started in the fall of 2012, with conclusions in 2013. As such, we can expect no changes for the next couple years.
The CRTC is sending a message that it wants stakeholders to provide more “rigorously collected data,” to assist the Commission in evaluating the impacts and opportunities offered by this environment. Its concluding paragraph calls for better quantitative evidence next year – a statement that this year’s information fell short of a standard that might have allowed the CRTC to draw more effective conclusions.