Netflix tells Canada regulator it shouldn't subsidize 'old media'

Fri Sep 19, 2014 5:28pm EDT
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By Alastair Sharp

TORONTO (Reuters) - Online video streaming service Netflix Inc told Canada's broadcast regulator on Friday that it opposes paying to support "old media" and its own commercial interests and market dynamics were enough to ensure it distributed Canadian content.

The submissions from Netflix came on the last day of a two-week hearing on the future of Canadian television in which the Californian company has been painted as a disruptive threat to the country's established cable and broadcast television interests.

"We are moving from a period of broadcast scarcity to one of Internet abundance," said Corie Wright, director of global public policy at Netflix. "This has a profound and largely positive impact on consumers and the marketplace for content."

Netflix and other online-only services have been exempted from Canadian Radio-television and Telecommunications Commission (CRTC) rules that enforce a minimum level of financial support and air time for Canadian programs on traditional TV.

Some politicians have advocated that streaming services like Netflix be regulated like traditional Canadian broadcasters, though the federal Conservative government had said they are not interested in taking this route.

Domestic broadcasters and distributors have suggested at the hearings that if Netflix remains exempt, they should also be granted more flexibility.

The question of consumer choice has been key to the Let's Talk TV hearings, with the government eager to see the CRTC force distributors to offer smaller packages of channels, saying Canadian viewers should not be compelled to pay for channels they don't watch in order to get the channels they do.

Netflix's Wright argued that the reliance of established players on advertising means they must aim for the widest possible audience - which encourages bundling of channels - while Netflix has more freedom to offer niche or experimental content.   Continued...

An illustration photo shows the logo of Netflix the American provider of on-demand Internet streaming media in Paris September 15, 2014.  REUTERS/Gonzalo Fuentes