Often, we speak of regulatory decisions as fair if each of the parties are equally upset.

It is tough to be a regulator in a competitive environment. Actually, I’m not sure it was loads of fun to be a regulator in the days of monopoly rate setting.

But, it has to be extra frustrating trying to understand when the expectations keep changing.

Back in July, Michael Geist accurately predicted the outcome of the CRTC’s review of over-the-top (“OTT”) video, released last week. At the time, he wrote:

The participants in this consultation fall into three main groups: those seeking competition, those who want more regulation, and those who want de-regulation.

What remains is the next step for the CRTC. It seems certain that there will be a full scale hearing, but the question is whether the Commission will cave to pressure from some groups for something immediately, or wait until the next new media hearing round in 2014.  Given the lack of actual evidence – this has been a fear-finding exercise rather than a fact-finding one – the CRTC should surely label this a watching brief and wait until 2014.

“Given the lack of actual evidence… the CRTC should surely label this a watching brief and wait…” Amazing call 3 months ahead.

In the report, the CRTC used language that paralleled the categorization of parties into 3 groups:

Many stakeholders proposed policy options to deal with the challenges associated with growing OTT content consumption; these generally fell into three large categories based on either regulatory or market solutions: a) lowered obligations for regulated entities, b) creating regulatory obligations for OTT providers and c) maintaining the status quo.

The accompanying news release said “While not containing any clear evidence…”, agreeing with the July article. The report itself even used Geist’s expression “watching brief” – a term that is rarely used by the CRTC, having appeared only 6 times in decisions, reports or policies prior to last week.

So I was a little confused by Geist’s article in Sunday’s Toronto Star. In that article, he again acknowledges the “lack of evidence”, but somehow draws a conclusion:

The consultation confirmed that consumers are gravitating toward services that offer on-demand access to video content at a price point far below that offered by conventional pay television and broadcaster services.

No such confirmation was made by the CRTC. The Commission found “that consumer adoption of OTT services is real and growing” but did not see evidence of harm to the traditional broadcast system. The word “price” appears only once in the report, and that was in the introductory reference to the Notice of Consultation. The report therefore did not draw the conclusion or even provide such a confirmation of “gravitation” to low priced on-demand access.

What the Commission said was “significant change is underway in the communications sphere” and it plans to continue to gather information, with a repeat of the fact-finding exercise next year. Fact-based decision making is what we should expect from our regulator.

The Star article says:

Indeed, rather than offering broadcasters and creator groups another chance to make the case for regulation, the CRTC should instead be closely examining the potential barriers to online video services from vertically-integrated media companies that combine broadcasting and Internet services and hold the power to undermine the nascent competition.

For example, Internet plans with expensive data caps can be used to increase the indirect costs of online video services when compared with on-demand video services from cable and satellite companies.

Yet, there was no evidence of consumer harm from internet pricing practices. Wouldn’t such evidence have been highlighted in the July blog post or this week’s Star article? It seems to me that there needs to be some clear evidence of a problem before the CRTC becomes one of the only regulators in the world to regulate retail internet business models. To the contrary, the CRTC report said “many parties stated that Canadians are the biggest online video consumers in the world.”

It seems that the CRTC got this one right by ignoring the call to sit on the sidelines until 2014.

Given the fast pace of change in this environment, the Commission intends to maintain a watching brief on OTT, and conduct financial data collection and another fact-finding exercise in May 2012 to determine if the scenarios put forth by parties with respect to potential regulatory impacts and opportunities have materialized. It expects that at that time stakeholders will be able to provide rigorously collected data, including public opinion research, internal customer surveys, historical revenues and expenses associated with OTT services, market intelligence, qualitative and quantitative evidence with respect to the state of closed captioning and described video for OTT programming and other such quantitative evidence, that will assist the Commission in better evaluating the impacts and opportunities offered by this environment. In addition, as part of its watching brief, the Commission will focus its annual consultation with the broadcasting industry primarily on the subject of OTT.

Everyone, consumers, content providers, content creators, ISPs, vertically integrated companies, independent broadcasters and all other stakeholders and observers alike, will have a chance to gather and submit evidence next summer.

The Commission was clear about its focus on its statutory mandate:

The Commission considers that currently it is best to allow the OTT market to continue evolving, better measurement tools to emerge and entities that contribute to the policy objectives of the Act to take advantage of the many opportunities in this new environment.

What exactly is wrong with that approach?

As Ricky Nelson sang, if you can’t please everyone, you’ve gotta please yourself.

In April, the world celebrated the 50th anniversary of Yuri Gagarin’s historic spaceflight, launched from the Baikonur Cosmodrome in Kazakhstan.

Later this month, a Proton M rocket is scheduled to lift off from that same facility, carrying with it Viasat-1, the fourth generation satellite that will power dramatic capacity expansion to provide rural broadband in Canada.

ViaSat-1 can support customer download speeds of up to 25 Mbps; its capacity is greater than the capacity of all current North American broadband satellites combined. Xplornet has secured all of the Canadian Ka-band capacity on this advanced satellite, and it expects the satellite service to be available to Canadians late this year.

The value of this new capacity was demonstrated with the 16 hour outage of Telesat’s Anik F2 satellite yesterday.

A game-changer in terms of ubiquitous broadband access in Canada, ViaSat-1 will allow for previously unavailable speed and bandwidth economics, and will provide Canadians in its footprint, which includes many remote areas, the opportunity to get a broadband connection that is truly fast and affordable.

Xplornet has a special website (4gsatellite.ca) that allows you to share in the excitement as launch day approaches. The space shot will be streamed to a live feed on that site.

I’ll be writing more as the countdown continues.

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.

TELUS Business Solutions has started to create the Ultimate IT Checklist, housed within its TELUS Talks Business website.

They have set up a discussion group to talk about the kinds of things that should be included in “IT Checklists,” such as:

• Top questions to ask when moving to the cloud
• Top things to look for when shopping for a data centre
• Top questions to ask a new potential IT hire
• Top security questions regarding cloud computing
• What to look for when replacing your old PBX
• Challenges in training IT staff on new technology advancements

It is an interesting way to engage with customers to encourage them to share experience. I am perhaps less interested in the checklists as I am in seeing the level of dialog on the site.

To what extent do you think corporate professionals will participate in such a project? How would you suggest engaging with that demographic?

In recent weeks, the federal government has introduced legislation that is designed to modernize Canada’s copyright laws, improve privacy protection, and various ministers have made multiple announcements on research and training at various schools across the country [such as here and here].

We seem to be witnessing a stream of tactics without a clear statement of the overall objective.

According to the press release that was issued last Thursday with the Copyright legislation:

Modernizing Canada’s copyright laws is an important part of the Government’s strategy for the digital economy.

The privacy laws were characterized similarly:

Ensuring trust and confidence through the protection of personal information is essential to the growth of the digital economy

Of course these statements are true. But, implicit in these soundbites is a perception that somewhere, there exists a comprehensive Government strategy for the digital economy. Where is it?

Maybe I missed it while I was away for Rosh Hashana last week, but did anyone ask “Can I get a copy of that digital economy strategy you keep referring to?”

And if copyright and privacy are “parts” of a strategy, what are the other parts? How do these pieces of legislation tie into the other elements of the strategy? Are there co-requisites, prerequisites? How do elements of the omnibus crime bill or its follow-up, the lawful access legislation, fit into the overall strategy? Is foreign direct investment in carriers part of the mix?

Will the national digital strategy play a role in a restructuring of our regulatory bodies or in the selection criteria for the new chair of the CRTC?

How can something be said to be “an important part” of a strategy that does not yet exist? I happen to agree that privacy, modernized copyright, support for increased R&D, digital law enforcement investigative powers and more are all important parts of our government’s strategy. But let’s face it, the strategy itself must be at least as important. Otherwise, how important can these piece parts be?

In the absence of a road map to a prescribed destination, shouldn’t we at least get a clear statement about the direction toward which we are heading?