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Netflix drawing criticism from TV industry

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75K views 412 replies 72 participants last post by  Wayne 
#1 ·
#60 ·
I really don't think you can equate Netflix with the BDUs
But you can equate it with a pay tv operator because its securing Canadian rights for content and then distributing through a subscription fee.

The truth is Netflix and Astral are the same. One uses the Internet to distribute its product and one uses coaxial cable.

Should the rules for Netflix be different than those for Astral?

Personally I don't want Netflix encumbered with regulations but I do want Netflix and Astral treated equally.
 
#61 ·
I'm curious, do the Americans or the British (countries most similar to Canada) feel the need to regulate foreign media? Specifically, do they have rules about how much of the broadcast content is home grown? Do all content consumers need to pay into a fund to pay for local content production (not counting stuff like BBC, CBC, etc).
 
#62 ·
I don't see how Netflix is special. As far as I can tell, Netflix is no different than Shaw VOD or PSN Video store, they just have a different business model (low fixed monthly rate) instead of a pay-per-view model.

For example, PSN store (available in Canada) has exclusive content available only on the PSN network; this includes a video magazine called "Qore" and a reality series called "The Tester". What really is the big deal if Netflix has one exclusive Kevin Spacey series?

Netflix is in fact a witch hunt, both in Canada and the US; nobody in the corporate world really wants to see them succeed. Hollywood sees people streaming from Netflix instead of buying DVD/Blu-Ray, cable/satellite companies see them stealing revenue from movie channels and PPV/VOD. Canadian broadcasters/BDUs see them as a threat to their oligopoly on video content.

The only people who want to see Netflix succeed are the consumers, and that's exactly why Netflix is seen as a threat. Just look at the headlines "Netflix deal a new threat to Canada’s pay-TV operators" Globe and Mail, Mar 30 2011; "Netflix a threat to the future of TV and films" Financial Post, Dec 1 2010; "As telecom industry evolves, success of Netflix is its biggest threat" Washington Post, Mar 6 2011.
 
#64 ·
Well if they see it that way cable and sat distributors should also blame internet broadcasting right which channels use in canada aswell
(sites like tou.tv etc)

I agree the canadian system is broken and should be fixed but not for the worst
the CRTC and the industry should evoluate with time and technology and stop screaming everywhere that those are threats to the industry.

everytime a new distribution system is invented it's always the same thing

do you remember when the first VCR was released the cinema industry told that it would kill the movie theaters

and what about itune Versus CD sales ?

the history repeat itselfs
 
#65 ·
Maybe Mr. Ken Englehart should look at his own company and realize that Rogers certainly doesn't contribute much to Canadian content via CITY-TV by airing non-stop US shows!

The whole broadacsting landscape is rapidly chaning. I now watch MLB games through my PS3 via the MLB package (in full HD btw), and not through games picked up by Sportsnet or TSN with Canadian ads inserted in there.
 
#67 ·
If this is such a problem why can't Shaw, Rogers etc. do the same thing as Netflix, they would also have the advantage of being able to get even better rates from the film industry by bundling the movies for ppv with internet rights as well, and they would have the same lack of Canadian Cancon obligations on the internet as Netflix.
 
#69 ·
I would think that if Shaw or Rogers did something like this it would be at a higher price, simply because there would be a difference in the content provided. EG. Latest movies and Sports.

Apparently, the Supreme Court of Canada will be deciding if ISP's are in fact broadcasters or not.
A coalition of content producers and cultural groups argued that as ISPs do, in fact, transmit video content, they should be thought of like BDUs or some other new class of media broadcasting undertakings and therefore be subject to an ISP levy to support the creation of Canadian content on-line.
 
#70 ·
Apparently, the Supreme Court of Canada will be deciding if ISP's are in fact broadcasters or not.
Here is a question: are ISPs considered broadcasters anywhere else in the world.

I'm pretty sure the answer is "no".

Edit:Ahh, I see this is an appeal after the lower courts already decided that ISPs aren't broadcasters, so they'll probably need to redefine the term broadcaster in order to get ISPs lumped in with them if they want to get their desired outcome from the Supreme Court.

How about this ACTRA, CMPA, (etc, etc): you guys make your content/product and I'll buy it if it's any good. Any system where I pay you guys irrespective of whether I like (or watch) your product isn't a good system for the consumer. GTFO.
 
#71 ·
Most ISPs do not originate the broadcast of content, they are simply common carriers. Companies like Bell and Rogers have blurred the line somewhat by offering home pages that provide content but they typically only provide links to other services and sites. Most ISPs just carry the data, as they should. Classifying all ISPs as broadcasters is like classifying a telephone company as a broadcaster because they carry ring tones and video.

If this is such a problem why can't Shaw, Rogers etc. do the same thing as Netflix
Exactly. How about TMNflix, MCflix, SCflix or even CBCflix? They just don't want to take the risk of adopting a new business model and cry foul when others do. Bell, Rogers and Shaw don't want to do so because they have too much to lose by offering alternative models. After all, who wants to pay $150/mo to BDUs for TV and internet when they can pay $50/mo for internet and maybe $30/mo for a couple of premium streaming services plus OTA.
 
#73 ·
CTV, Global ans CBC stream shows on the internet. I'm sure other stations do as well. Is it regulated by the CRTC? I think not. BDUs such as Rogers, Bell and Shaw also stream shows using their own VOD services or internet. Other than adhering to the rules for their broadcast ISP undertakings, I don't think their VOD operations are regulated either. Some ISPs also stream videos from their home pages with little regulation. While these companies also own broadcasting operations, it's their TV broadcasting operations that are regulated and taxed, not their VOD or PPV operations. I also don't see the CRTC regulating their video rental and sales operations or any others. The big BDUs have blurred the picture by merging their ISP, BDU, broadcasting, streaming and sales operations into one big conglomerate. Now they are using their own lack of arms length operation in those operations to eliminate competition in non-regulated areas. If they succeed in that, next they will be asking for regulation in every new business they decide to start or acquire. Pretty soon, we won't be able to watch a movie at a theater or buy a DVD without paying into the Canadian Broadcast Fund or LPIF fund. Just where will it end? I'm getting tired of giving handouts to every Canadian artist and business that has a sob story for the CRTC.
 
#74 ·
I read a few pages of the report that was quoted in Shaw_Champ's post #34.

Looks to me that Bell,Rogers,Shaw etc are doing what the economists call rentseeking. Reading their comments one can almost hear the undertones of " as soon as we can we'll get the other people ( Netflix etc.) off our networks or make them pay so much they will be uneconomic...then we'll get all the advertising revenue"

I don't care one way or another about Hulu,Netflix etc. but I do firmly believe that the BDUs/ISPs should be absolutely forbidden from owning any content companies and should be forced to act only as common carriers. Or I suppose they could divest themselves of their BDU/ISP activity and infrastructure and become content companies...don't care as long as its one or the other.

Imho fix this and you will have fixed most of what is wrong with the Canadian TV and Internet industry probably at some cost to Cancon and jobs tho'.
 
#75 · (Edited)
I don't subscribe to any streaming service, but...

I certainly follow the logic of trying to make things "fair" by forcing Netflix to play by the same rules -- exclusive contracts are advantageous, but only if you charge a low enough price to entice Canadian subscribers to jump ship, otherwise, who cares what Netflix does? In Canada (and any country, really), "fair" is a four-letter word that doesn't mean much if you are talking about competition. Netflix (an American "invader") will NEVER be treated fairly, unless it starts to lose money and lose subscribers. It's an American company with deep pockets. Rogers will simply claim that Netflix is like a hooker with HIV and must be deported out of our great country to save Canadians from possible harm. Rogers can simply lower the caps even more and not include its streaming services as part of the cap. The CRTC will say that Rogers isn't allowed to do that and that Rogers must be financially punished if it continues to control bandwidth in a non-competitive manner. Rogers will say that the CRTC is misinformed and then take them to Disneyland for a free vacation to discuss the matter in private. Yes, the CRTC is always fair and balanced, isn't it? What a crock this entire issue of playing by the same rules is! Unless Netflix does what it's told and allows its Canadian competitors to dictate the rules that it must play by to stay in Canada, Netflix will be booted out of Canada. Make sure to visit a Canadian Tire store on your way out of Canada, Netflix! Thanks for stopping by and we hope you've learned your lesson! Canadian companies control the US programming here, not you!

For Canadian companies in the entertainment industry, it's best to stifle or interfere with any American company that might pose a financial threat to their bottom line. Is it fair that Canadian TV stations can buy the US broadcasting rights to all of the US programming they can afford, but whenever they don't have time to show it all, or decide to skip buying some of it, we can't legally watch it by trying to access the US versions of specific TV stations, like A&E, HDNET, etc.? We must wait like the loyal Canadians that we are for the chance to watch things that are NOT airing on a Canadian channel. Sure, some shows on the major US networks that are not simulcasted can be viewed by Canadians, but that's only because without at least some US channels being included in our cable or satellite packages, most Canadians wouldn't bother subscribing to Rogers, Bell, etc., to watch strictly Canadian content. CTV and other Canadian networks hijack (they call it simulcasting or sim-subbing) the major (and minor) US networks to show us Canadian commercials and advertising for the shows that they carry and make a nice profit doing this. Take simulcasting away from them and most Canadian channels would be forced to close up shop. Canadian companies have been leeching US programming since the dawn of time because Canadian content is generally seen as a negative by Canadian broadcasters and the Canadian public; if there were no Cancon rules, there would be even fewer Canadian shows on the air here. Canadian companies have to literally be forced into showing them and they want Netflix to be forced into their hellish world, so that Netflix can lose even more subscribers because of the extra Canadian content.

However, recently, Netflix picked up the rights for some CBC (the Canadian broadcaster that refuses to divulge what it does with our hard-earned cash --I think it's about $30 a year that we pay in taxes for the CBC) programming even though it wasn't forced to do so because of Cancon rules. Netflix must have decided that the price was right and it would be smart to add at least some Canadian programming to its small streaming library in hopes that more Canadians would feel satisfied that Netflix was trying to buy all the content that was available to them. But now that Netflix bought some coveted and exclusive US programming rights (Paramount), suddenly they are evil and must be forced to pay into some protection racket to fund often inferior Canadian programming that most Canadians don't care about. And you wonder why most US companies don't want to deal with Canada. Try getting something sent to you through the mail from the USA and see how hard that can often be. It's easier and cheaper to often get stuff shipped from the UK. America is a threat to Canada. We are at war with the Americans until they become as insignificant as we are. Until then, keep funding the Canadian entertainment army with your hard-earned dollars and watch the Americans get picked off one by one as they are ambushed by the CRTC and the other fake protectors of Canadian "culture." How would I survive without "Corner Gas" or "Being Erica?" I think I'd be alright living without them, just don't block me from watching the US programs (many of them filmed in Canada with Canadian partners that never air here or even appear on DVD, except in the good old USA) that I'm addicted to and need to watch (I've gotta watch something to unwind while I'm resting from my crusade to kill Canadian interest in the entertainment industry).

In Canada, you get what you pay for, even though you don't want to buy it, because apparently we don't have a choice in the matter. We buy what the government tells us to buy and then we thank them like the good and polite Canadians we are.

In the past, because the CRTC and the Canadian TV stations would try to make US broadcasters jump through hoops in order to come to Canada and offer us low-cost US programming, most of them would decide that it wasn't worth the trouble. Canada is a relatively small nation with a hunger for US programming. Suddenly, Netflix comes to Canada through the Internet and we don't have to jump through any geo-blocking hoops to subscribe to it. Wow, Canada is finally free from the tyranny of the CRTC ... not so fast! As long as Canadians continue to support Canadian-owned companies, the CRTC and its partners in anti-competition "crime" will make this a battle between Canadians and the evil foreigners, especially if they happen to have deep pockets and are willing to pay top dollar for the US programming that the Canadian companies want to buy at a low cost and then gouge Canadians for the right to watch it. This is about greed! Greed is good! Greed isn't strictly Canadian, but as long as the Canadian public keeps subscribing to Canadian-owned companies in the entertainment business, Canadians will continue to get what they pay for ... outdated US programming at a ridiculous price! Is that fair? Of course not! But nobody said that life has to be fair. Let your money do the talking and just walk away from the Canadian entertainment business model. Go on strike! Don't bother complaining, just stop subscribing!

I realize that even if every Canadian refused to pay for any Canadian services and strictly subscribed to US companies like Netflix for their entertainment, the Canadian Government would be forced to tax us to subsidize the Canadian companies and keep them afloat until all Canadians finally realized that there is no way to "legally" watch US programming in Canada, unless you allow the Canadian companies to get a big piece of the action. I imagine that if the Americans suddenly wanted to watch Canadian programming and cancelled their US entertainment packages to watch Canadian channels through various workarounds, the US Government would have to step in to make things more difficult for the American citizens to access Canadian television/movies that could not be accessed on US stations.

Such is the world we live in. Greed is good! Competition from foreign invaders, not so good. You don't need politicians to do your dirty work for you. Just step up to the plate, swing your bat and if you don't hit a home run, don't worry about it. Just wait for the right "pitch" and swing for the fences.

I don't like having to subscribe to 20 channels or more just to see what I want to watch on TV, so that's why watching TV on DVD is one way to go around the CRTC, while still paying Canadian companies for the right to watch those shows. I'm okay with that because even though Canadians often pay more than the Americans for the same product, at least the Canadian government hasn't stepped in to charge me an extra tax for the privilege to watch a "US Import" DVD from Amazon.ca. At least not yet.
 
#78 ·
Looks to me that Bell,Rogers,Shaw etc are doing what the economists call rentseeking.
It certainly does. First they used national protectionism and regulation to gain an economic advantage. Then they used that economic advantage to expand operations, become vertically integrated, form cartels and eliminate competition. Now they use their economic clout to manipulate regulators and the political process to fight off new competitors and increase income though regulation and taxation.

http://www.economist.com/research/economics/alphabetic.cfm?letter=R#rent-seeking said:
Rent-seeking...
• lobbying the GOVERNMENT for tax, spending or regulatory policies that benefit the lobbyists at the expense of taxpayers or consumers or some other rivals.

Whether legal or illegal, as they do not create any value, rent-seeking activities can impose large costs on an economy.
The irony is that cable and satellite BDUs originally created the problem by providing access to US and other distant signals that threatened local broadcasters. They were once the new companies that offered competition in the way of low priced, innovative services. They were, in effect, the "Netflix" of the era. They leveraged their existing positions into building high speed ISPs that make internet video services possible. They have leveraged those operations into also becoming major broadcasting operations as well. Now, they are asking for financial compensation for the broadcasting operations they acquired, the very services that their own BDU and ISP services made economically nonviable. It's about time the government put an end to this madness.
 
#79 ·
I think there are two separate issues here:

1. The Canadian government is forcing content distributors to subsidize Canadian content producers. I'm sure Shaw, Bell, Telus (etc, etc) would prefer not to have to pay the Canadian content producers (rent seekers).

2. Because of the Internet, content distribution is becoming commoditized. That means the cable companies (and the satellite and DSL equivalents) will need to accept the commodity price for those services. The commodity price won't provide them with the level of profit that they are used to.

Fortunately for them, the commoditization of the content distribution role only hurts their "TV delivery" business. If those companies have a corresponding ISP business, those business will become increasingly more important. Unfortunately for the cable companies, if markets remain relatively competitive they will not be able to adjust their internet prices upward fast enough to make up for the loss of profit on the TV delivery side of the fence.

On this particular issue I don't see Shaw/Telus/Bell/Rogers as rent seekers. All they're saying is that the Canadian content producers exhibiting rent seeking behavior (successfully) traditional distribution mediums, but not (yet) on internet streaming services.

I don't envy Shaw in this situation. Their traditional cable TV market is leaking customers, and soon that leak is going to turn into a flood of people moving to free/cheap video services (OTA, Netflix, Hulu). At the same time, their ability to be price competitive is hampered by the rent seeking behavior of the Canadian content producers.
 
#80 ·
Astral being in the Pay TV business also runs radio stations. Netflix doesn't do this. How may % Canadian content do they have to put on those specialty channels? Also there is no commercials on Netflix but there is on some of Astral's stations. I dunno, I don't think they can be considered similar.
 
#81 · (Edited)
Welcome to China...

Reed Hastings mentioned this month that he sees Netflix as just another cable TV channel. As an add-on (not a replacement) to your cable or satellite package for only $7.99 more each month.

He expects Netflix.ca to be profitable by the summer, as Canada reaches 1 million members. If Netflix is indeed successful, I say bring on the other US companies and cut corporate Canada out of the picture entirely. Stream to Canadians through the Internet and simply set your own price structure and collect all the money for yourself. Who needs Rogers or Bell to distribute television anymore? Let Rogers and the gang hike the Internet prices even higher, so that none of us can afford it and then let CNN expose them for the crooks that they truly are. If we don't subscribe to Canadian cable or satellite services, the US channels might follow Netflix's lead and start streaming to Canada. Geo-blocking be damned!

Take that Astral! How's that for a knuckle sandwich Super Channel?

To prevent that possible alternate universe from happening, Canada needs to be more like China and start realizing that the evil Americans are giving us too many dangerous ideas of freedom and this kind of thinking has got to be stopped. Geo-blocking all the US services will at least block the less Internet savvy and poorer Canadians from accessing the US sites through VPNs or other services.

It's easy to sum it up if you're just talking about television. Netflix.ca is just like an American TV channel, except that it slipped into Canada without having to get approval from the CRTC and it isn't geo-blocked even though it's a coveted US product that is available to us through the Internet. I mean listen, we're sitting here talking about television, how silly is that?

Now I know that I'm supposed to lead by example and all that, but I'm not shoving that aside like it doesn't mean anything. I know it's important, I honestly do, but we're talking about television. We're talking about television, man. We're talking about television. We're talking about television. We're not talking about the Internet. We're talking about television. When you go to the Internet, and you press play, you've seen the movie right, you've seen it without having to give everything you've got, but we're talking about television right now.

It's funny to me too, hey it's strange to me too, but we're talking about television man, we're not even talking about the Internet, something that actually matters, we're talking about television.

How in the hell can I make things better by watching television?

So my life is going to deteriorate because I'm not watching television? Is my life going to get worse? I'm asking you, is my life going to get worse? So what about Netflix? Is my life going to get better because other people are not watching Netflix, I mean, does that hurt me? Do you think that it hurts me? I'm being honest, fewer people are watching Canadian television, but does that hurt me? Does that hurt me when I go out there and watch 48 minutes of Netflix, does that hurt me as a person? Does that hurt me if this person is watching television or that person is watching Netflix? Does it hurt me?

I'm saying that's why we are in here having this talk because of Netflix.

It's not television ... it's Netflix!

[Special thanks to Allen Iverson.]
 
#84 ·
IMO; Netflix is a little overrated, but highly recognized (especially with electronic makers, ie. Sony, Samsung, etc.). I'm not saying that the Netflix services aren't great, but from what I've heard/read, the content is a little older, correct? Anyway, If a ex-consumer goes to the OTA/Netflix route, its an option that competitors want to fight. Bad enough; we cant easily watch channels such as CBS, Fox, etc. online, and OTA isn't an option to everyone.

My biggest issue with Netflix is bandwidth, which competitors are already in control of too. We'll probably never win.
 
#86 ·
Broadcasters use their perversive control? as a cultural measure; ( ha ! shades of The Peoples Broadcasting Networks ) to extract seemingly endless, outrageous profits for little to not much better product, with much too loud, COMMERICAL infested products ....????

Imagine a netflix movie interuped with FrankenStien's face every 1/4 hour to inform you of the comminssions great attitude in allowing you to watch what you are paying for ....:(
 
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