Will you meet me in Toronto, June 1 – 3, 2015?

Make plans now to be at The 2015 Canadian Telecom Summit in Toronto, the largest and most important gathering of the leading stakeholders in Canada’s information and communications technology sector.

Planning is just getting started, so be sure to get in touch with speaker proposals. We will be exploring “Hyper Connectivity: Shaping Personal & Business Digital Relationships.”

Registrations are already open.

Mark the dates in your calendar: June 1 – 3, 2015.

Yom Kippur, the Jewish Day of Atonement, took place this past Friday evening and Saturday. It is a solemn day of fasting and reflection, asking forgiveness for transgressions over the past year and an opportunity to seek spiritual guidance for doing better in the coming year.

Afflicting ourselves, denying ourselves food, water and other forms of pleasure helps focus ourselves on the importance of the day. The holiday of Sukkot, the Feast of Tabernacles, begins this Wednesday and among its observances is reading King Solomon’s Book of Ecclesiastes, the inspiration for Pete Seeger’s song: “Turn, Turn, Turn“. At its core, I see a message of balance in the lyrics: “To everything there is a season, and a time to every purpose under heaven.”

In an era of being online all the time, with our societal norm of immediate gratification, the pause for such times with family provides me with a chance to reset some semblance of balance in my life.

I sometimes think that such days would be helpful for the secular community. Pausing and reflecting seriously about issues that can have a lasting impact.

Balance is often missing from public discussion about the CRTC. It is too easy to take cheap shots about our institutions. It is much tougher to apply a critical eye, to explore issues with more than a superficial swipe of the hands. As I have written before, we need to explore the digital economy with the thinking of a chess master, looking beyond the next move.

Almost ironically, on Yom Kippur, I had an opportunity to read an article by Simon Houpt in Saturday’s Globe and Mail, that brought some critical intelligence and balance to otherwise imbalanced reporting.

Much of media coverage of Netflix’ showdown with the CRTC has been largely one-sided, unfair and even bizarrely self-perpetuating.

The CBC was perhaps the biggest offender, leading its online coverage with a headline saying “Netflix refuses CRTC demand to hand over subscriber data”. As was apparent from comments on the story, many casual readers thought the CRTC was trying to get personal information about Netflix subscribers (such as the shows you watch), rather than the actual CRTC request: how many customers does Netflix have in Canada and how much is Netflix investing in Canadian programming.

CBC then had the audacity to have a follow-up story, saying “CBC News readers side with Netflix in spat with CRTC”. Given the misinformation in the initial CBC story, it wasn’t surprising that CBC readers sided with Netflix. The CBC coverage of this broadcast hearing was not one of the prouder moments for our national broadcaster.

Whatever you think of the idea of taxing or otherwise regulating Netflix, Google or other internet broadcasters, it’s important to distinguish the act of regulating from the act of information gathering. As a quasi-judicial body, the CRTC is required to base its decisions on evidence gathered during public proceedings, not simply on the basis of which party put on the best dramatic performance.

CRTC Chairman Jean-Pierre Blais had every right to ask for the information to help the CRTC understand the state of the streaming video market. That Netflix changed its position on providing the information from “we are concerned about our confidential information” to “you have no authority over us” undermines its position as a new media leader helping to shape digital policy in Canada. Yet nowhere did we see this distinction raised in media.

Could Netflix have offered proxies for the information sought to satisfy their confidentiality needs? For example, analysts have estimated that Netflix is in about 25% of Canadian households. Netflix might have responded that it is comfortable with those estimates, providing helpful guidance to the CRTC while preserving its corporate secrets.

Can you imagine the outrage if a Canadian company showed up in Washington and treated any American regulator with the same approach?

There were a few bright spots, to be sure, including Terry Pedwell’s Canadian Press story on the inappropriate political interference by the Prime Minister’s Office in the Let’s Talk TV hearings, which was unfortunately picked up by only a few regional media outlets.

… by inappropriately interfering in the CRTC hearings, the Harper Conservatives may have already rendered the regulator toothless, said Opposition heritage critic Pierre Nantel. “It is simply scandalous,” Nantel said.

Simon Houpt’s excellent piece in The Globe and Mail, appropriately published on Yom Kippur, “It’s time to be honest: Netflix is parasitic”, forcefully expressed what I can only hope others in the media have at least considered:

But please, at least be honest with yourself and recognize that Netflix … is a parasitic enterprise …. At least, we believe that’s the case; we don’t know, because Netflix won’t share any of its data with the CRTC, since it says it is worried the information won’t be kept confidential. (This is a company whose business depends on millions of people trusting it to keep their credit-card data safe …)

The article continues:

… we have a Prime Minister who has now sided with an economically and culturally parasitic foreign entity, one that doesn’t even remit taxes in this country, over one of his own government agencies.

Take the time to read the complete article, not just the headline. It is an important message to balance against other perspectives that have dominated our airwaves. To everything, there is a season.

The CRTC and its Chair, JP Blais deserved fairness and balance from our government and the Prime Minister’s Office. Canadians deserve better analysis and reporting from our news media.

It was an especially tough summer for repairs. Working from my cottage, I am used to having things break down more frequently.

A couple years ago, I went through a few wireless routers. It seemed every thunderstorm would fry one.

This year took out my espresso machine, a couple propellers, a microwave oven, a toaster oven and 3 screens for a single cell phone.

Yes, 3 screens for one cell phone. At $250 each, I asked my Muskoka repair guy if he had a punch card program so that every tenth screen would be free.

So I was quite interested to hear about the Samsung Galaxy S5 Active hitting the market in Canada. It is reported to be a solid answer to my problems sheltering high end devices from the dangers of impact with Muskoka.

Having gone through so many screens on one of our family devices this summer, when I heard about the S5 Active offering all the benefits of Samsung’s high performance devices combined with military grade protection against salt, dust, humidity, rain, vibration, solar radiation, and shock resistance, I thought that I can’t be alone in seeking better protection for our mobile phones.

These are powerful computers, cameras, high definition TV screens that now fit in the palm of our hands, and slip out of our pockets way too easily. TELUS (and some other carriers) also offer Device Care and Device Care Premium to provide what you might consider to be stupidity insurance – something that would have saved me some headaches this summer.

When my kids were in school, we had such complete care packages for their notebook computers, which took care of replacing screens damaged when closing on a pencil case and a replacing a computer that didn’t really want to share a beer that my son spilled into the keyboard.

Is it just my family?

Do you have a device care package for you mobile phones? How many screens and phones have you damaged?

Is there a bigger market for high end hardened devices?

I am looking forward to test driving one.

Regular readers know that I am not a fan of the ever changing rules for the Canadian wireless sector. I have called it a Calvinball approach on more than one occasion. Policy makers just seem to be making it up as we go, reacting instead of leading.

In April, Minister Moore said, “I wish we had moved on this file, on the roaming fees, much sooner, because it actually may have had a material impact on the scene right now in Canada’s wireless world.”

The fact is that all of these issues have been considered numerous times in public consultations associated with the wireless framework. The Minister’s regret is a powerful statement – one that may come under consideration in the litigation over the collapse of Mobilicity.

Agree with the need for intervention or not, legislative changes on roaming fees may be another example of half measures that might have benefited from a more complete review, had the enabling legislation not been buried in the middle of a budget implementation bill. For example, the roaming rates established by the legislation did not contemplate new entrant subscribers making out-of-country long distance calls. How would that impact overall consumer wireless rates?

But, as described in an article in the Globe and Mail on Monday, it isn’t just the wireless telecom world that sees on-the-fly policy making. Broadcasting regulation is now also being subjected to political interference.

In a speech delivered last Monday, the Prime Minister said his government was helping Canadians by letting them pay only for the channels they want, and stated he would oppose any “tax” on services such as Netflix and YouTube. Those are popular positions, which is presumably why an election-ready Harper is taking them without first letting the CRTC finish its work. But they are also self-contradictory, and based on ignorance of the TV business.

Next week, the CRTC will open the oral hearing phase of its review of wholesale mobile wireless services proceeding, perhaps exploring what other improvements can be made to the competitive wireless sector. Will tweets from observers of next week’s CRTC process trigger more regulatory interference from the government side of the Ottawa River?

As we prepare to celebrate our nation’s sesquicentennial, how do we envision Canada’s communications marketplace in 2017?

What is our vision?

What are the measurable objectives that we can set to ensure that we get there? What are the strategies that we need to put in place in order to achieve those objectives? What tactics are consistent with those strategies?

That should sound familiar. A year ago I wrote “Set clear objectives. Align activities with the achievement of those objectives. Stop doing things that are contrary to the objectives.”

We are years overdue for an overall telecom policy review. Increasingly, we are seeing an overlap between telecom and broadcasting issues coming before the regulator. Teksavvy’s requests in the CRTC TalkTV process and a CRTC decision under the Digital Media Exemption Order this past Monday demonstrate the need to re-examine separate laws to govern these increasingly overlapping communications industries.

Indeed, the Netflix challenge of the CRTC’s authority gives rise to another reason for the government to create an expert panel, charged with exploring the role of broadcast and telecom regulation in a complex digital era. Moving forward on such a panel would provide an opportunity for the new media jurisdictional crisis to subside and allow issues associated with digital media regulation to be explored by a panel of those able to consider the matter with calm consideration. Naming such a panel now would simultaneously provide an appropriate political cover for a government that could not want such headlines when it is facing an election next year. Above all, we are long overdue for such a comprehensive review. The report would undoubtedly be delivered post-election.

This evening marks the start of Rosh Hashana, the Jewish New Year, as we mark the start of the year 5775. It is a time for reflection, for reviewing what we did wrong over the past year and seeking guidance for doing better in the year ahead.

My office will be closed later this afternoon and on Thursday and Friday to mark the holiday.

Apparently, Netflix has decided to challenge the CRTC’s authority to regulate new media by refusing to comply with a Commission order on Friday to file commercially sensitive financial information.

As a result, we find ourselves in a battle that can have no winners: not Netflix, not the CRTC, not the government and certainly not Canadian consumers or creators.

Let’s review how we got here.

Netflix appeared voluntarily in front of the CRTC’s Talk TV consultation, having been invited by the Commission to present its perspectives. Google appeared at the beginning of the hearing on the same basis, a little over two weeks ago. Its lawyer was subjected to a somewhat hostile welcome, making many of us question whether Netflix would even show up last Friday.

Still, Netflix knew that the CRTC would be seeking details of their operation in Canada and apparently started a conversation with Commission counsel in advance of its testimony.

21002 MS WRIGHT: So we don’t publicly disclose subscriber data outside of the U.S. However, we have reached out to counsel at the CRTC to discuss how we can best make that available to you on a confidential basis.

The issue is that companies are able to file information confidentially with the CRTC, but there is a public interest test in Canada that allows third parties to ask the Commission to place information on the public record that has been filed confidentially. Netflix counsel was aware of that problem and sought guarantees that its commercially sensitive information would not be disclosed.

The start of Canada’s crisis in authority began with this breakdown:

21009 THE CHAIRPERSON: The CRTC protects confidential information every day.
21010 MS WRIGHT: I understand.
21011 THE CHAIRPERSON: We have lots of confidential information, like many government departments. You coming here and suggesting that we don’t treat information confidentially is actually a bit offensive.

One only needs to look at the filing of information this past summer in the wireless wholesale proceeding to see an example of where the CRTC has not accepted company claims for confidentiality.

The Commission is therefore not persuaded that disclosure of the requested information would likely result in significant specific direct harm to any party. The Commission also considers that there is a strong public interest in disclosure of this information.

So, Netflix was rightfully concerned about groups seeking public disclosure of their information. At one point (line 21104 of the transcripts), the CRTC chair said “Confidentiality will be granted to the information” but, as Netflix counsel knew, that was not sufficient, leading her to say:

21125 MS WRIGHT: Subject to the terms that we discussed before, Mr. Chairman; if you can guarantee the confidentiality, we will be happy to —
21126 THE CHAIRPERSON: I have never used the word “guarantee”. I have said that we are ordering you to provide it, and I am doing so again with the question that the Vice-Chair just asked, and it will be granted confidentiality.

One can imagine a long list of intervenors, such as the creative community unions and others who sought to tax streaming video, who would have argued for the public interest in these details. The Chair could not guarantee preserving the confidential status, despite his attempted assurances earlier that “The CRTC protects confidential information every day.” But other parties in the proceeding would be given their opportunity to argue for its disclosure.

The public interest in this data is significant. After all, the CRTC vice-chair exclaimed during the exchange:

21271 COMMISSIONER PENTEFOUNTAS: That’s a heck of an answer for someone that takes perhaps hundreds of millions of dollars out of the Canadian economy, Ms Wright. So if you can help us, we’d appreciate it.

That is hundreds of millions of reasons for the public to want to know what Netflix is doing in Canada.

But now we have an outright challenge of the CRTC’s authority. The CRTC threatened Netflix in a manner that seems unlikely to be carried through:

21038 You operate under an exemption order that requires you to provide information. Failure to provide information puts at risk your exemption order. So the Commission is ordering you to provide the number of subscribers that you have currently in Canada by 5:00 p.m., Ottawa time, Monday.

So, Netflix has decided to test the Chair of the CRTC, saying “the orders are not applicable to Netflix under Canadian broadcasting law.”

What happens if the CRTC decides that Netflix is in violation of the Exemption Order? If Netflix is no longer exempt, it is ineligible for a broadcast license since it is not owned and controlled by Canadians. Does anyone expect the CRTC to order the blocking of a service that is being received by quarter of Canadian households?

Do we think the government will support any disruption to Netflix operating in Canada, when a quarter of all households are estimated to be subscribing?

Still, should we not expect respect for orders issued by a legitimate tribunal? This wasn’t about taxing over-the-top media. This didn’t need to be about testing whether the CRTC has the authority to regulate Netflix or YouTube.

Will the Government support the CRTC or support a foreign company “that takes perhaps hundreds of millions of dollars out of the Canadian economy” flouting a number of legal orders? How should the CRTC and government respond to this challenge to Canadian governmental authority?

Consumers lose either way, whether the CRTC’s authority is weakened or Netflix decides that operating in Canada is no longer worthwhile. If Netflix chooses not to invest in Canadian production because of our hostile environment, Canada’s creative community loses.

There were certainly options that could have provided the CRTC with the information it needed while safeguarding sensitive financial information.

It is unfortunate that cooler heads did not prevail last Friday morning.