No internet tax for Canadian media

I agree with Conservatives who reject an internet tax to support Canadian media but for different reasons.

    Heritage Minister Melanie Joly. Image: Huffington Post

Conservatives reject taxes do so because they reject government intervention in what they see as a commercial enterprise. If media corporations can’t stand on their own without support from taxpayers, then they should fall.

But media are not only an enterprise; they are reflection of who we are and necessary for an informed citizenry. The goal of all legitimate media is to report unfiltered news and if my taxes go towards achieving that end, then it’s money well spent.

Use of an internet tax to support Canadian media is controversial. Politicians who are normally on opposite sides of the issue agree on this one. Two lobby groups that I support are on opposite sides. The Friends of Canadian Broadcasting supports the internet tax. Open Media rejects it.

A parliamentary committee recently recommended the internet tax, which Prime Minster Trudeau promptly rejected. The recommendations weren’t even unanimously supported among committee members. Predictably, Conservatives rejected the tax and some Liberals supported it. Prime Minister Trudeau sided with the Conservatives (again, for different reasons).

Before decided which side you’re on, it’s useful to know what it is. It’s a tax on streaming content over the internet as opposed to a tax on cable or satellite content, or over-the-air broadcasting.

What it’s called is determined by which side you’re on. Opponents call it a Netflix tax. “Applying the 5-per-cent levy to broadband distribution, that’s a Netflix tax,” said Conservative committee member Peter Van Loan. “Efforts to turn back the clock to an earlier era are doomed to failure.”

Prof. Michael Geist agrees with Van Loan but doesn’t find it necessary to call it a Netflix tax. It’s an internet tax because it applies to all internet content and as such, it’s a bad idea. Geist, a law professor and Canada Research Chair in Internet and E-commerce Law, sees the internet as more than a source Canadian content:

“A taxation system such as the one used for cable and satellite companies is highly inappropriate given the Internet’s importance for communication, electronic commerce, Web banking, education and tele-health. Given its integral role in virtually every aspect of modern life, it is wrong to treat network access as little more than an ATM for the cultural sector.”

Geist points also points out that such a tax is inconsistent with the Broadcasting Act because internet providers are not “broadcast undertakings” under the act.

Trudeau took the line that he was protecting the middle class: “We’re not going to be raising taxes on the middle class through an Internet broadband tax. That is not an idea we are taking on.”

Canadian media deserves support. Open Media suggests that the proceeds from the sale of cell phone wireless spectrum could go to Canadian content. Tax revenue should be used to support public and private broadcasters as suggested by Friends of Canadian Broadcasting. Small market broadcasters like CFJC in Kamloops should continue to receive funding from the CRTC.

Canadians pay one of the highest internet rates in the world. The best way to support Canadian media is to ensure that Canadians have an affordable, high speed internet where innovators can create content.

Canada’s internet remains flat, despite challenges

Canada remains a world-leader in keeping our internet equal for all. Challenges to tilt the internet in favour of special interests come from at home and abroad. Last month, Canada’s telecomm regulator ruled that all online data be treated equally.

The ruling comes after Videotron, a music streaming company, offered their wireless service to subscribers at no charge for data used. This practice, called “zero-rating,” is violation of net neutrality because content would be biased in favour of their service. Subscribers to other music streaming services would pay more. The Canadian Radio-television and Telecommunications Commission ruled the practice illegal.

In his ruling, the CRTC chair Jean-Pierre Blais suggested a less disingenuous tactic for Videotron:

“Rather than offering its subscribers selected content at different data-usage prices, Internet-service providers should be offering more data at lower prices,”

The ruling is a victory for the little-lobby-group-that-could, OpenMedia.ca (which I support financially).

“We just won again!,” they crowed in an email to me, “The Canadian Radio-television and Telecommunications Commission (CRTC) just decided in favour of historic Net Neutrality rules that prevent Big Telecom from unfairly manipulating data caps to discriminate against certain apps and services.”

Michael Geist, professor of Internet and E-commerce Law, was equally enthused but more muted in his response:

Most notably, Canadian consumers and creators will benefit in the long term from the Net-neutrality policies.”

Canada’s firm support of net neutrality extends beyond a level playing field. Without it, giant telcomms could start to collect browsing habits of unsuspecting customers and sell them to advertisers for the purpose of targeting specific demographics.

The concept of a flat internet is vital to free expression and innovation. In an earlier column, I argued that net neutrality is fundamental to democracy:

Canadians must stand on guard for a free and democratic internet.”

Net neutrality in the U.S. has been tilting back and forth. In 2014, the U.S. appeals court ruled that the internet was not a “common carrier.” A common carrier is like a telephone line, simply a conduit to carry information. If telephones weren’t a common carrier, telephone companies could make it easier for businesses to access your phone than your friends and family.

The designation of common carrier is vital to net neutrality. Without that designation, internet service providers could effectively suppress content by making it more costly to view.

Sensibly, President Obama restored the designation of common carrier in 2015.

Now President Trump’s appointees to the U.S. telecomm regulator, called the FCC, intend to overturn net-neutrality in the U.S.

Canada faces a mixture of faux worry and resistance from the U.S.  A Trump-appointed advisor to the FCC, Roslyn Layton, said “My biggest concern for Canada is that you continue to add regulation that deters the incentive to invest,” Her fake concern for Canada not believable. Many big U.S. giants such as Netflix oppose the Trump initiatives because they don’t want their subscribers paying more than competitive video-streaming. They fear that U.S. telcomms will do what Videotron tried to do and tilt the internet in favour of their own services.

I have a feeling that Layton’s real concern is that U.S. tech start-ups will move to Canada where innovative technologies still have unbiased access to the internet.

Local content on the new aether

Medieval scientists believed that radio waves were carried through a medium they called the aether. Seems sensible. If sound waves require a medium, why not radio waves? It turns out that radio doesn’t need a medium; a vacuum will do nicely.

radio

     radio waves

The internet is the new aether. The “network of networks” depends on wires and optical fibers to carry signals. The internet wouldn’t exist without it (Wifi is radio but it’s just a connection to the internet).

We straddle both worlds –ethereal radio waves surround us while the internet remains wired. If I put up an antenna, I can receive CFJC TV for free. I chose to pay Shaw cable to have the station delivered to my house.

The internet is as disruptive as early radio and TV was and its role is still being defined. Is the internet a broadcaster? If CFJC is a broadcaster and if I can receive the same station over the internet, it would seem like it.

Not so. In 2012, the Supreme Court of Canada heard arguments from program producers that cable companies were broadcasters. The court agreed with cable companies that they were not.

It’s not trivial matter. If traditional TV stations are broadcasters and cable companies are, then the cost of production local shows and news has to be paid for by the TV stations –they receive nothing for the signals that cable carries.

It’s a problem in small cities like Kamloops because local news and programming is expensive to produce and ad revenue is not as high as large cities.

In the past, cable and satellite companies have grudgingly paid into temporary funds to support local programming but it’s a constant battle. This has left small markets scrambling to make ends meet.

Local news is vital. It not only informs the community it serves, reflects its values, and is vital in emergencies. Rick Arnish, Chair of the Small Market Independent Television Stations Coalition (SMITS), was a strong advocate of local TV before retiring. He also supported free over-the-air TV for people who can’t afford cable. He made that clear in his letter to the Canadian Radio-television & Telecommunications Commission in 2015:

“Over 95% of the participants who posted comments on the topic of over-the-air television in the online consultation held during Phase 3 referred to the importance and value of the ability to receive television programs inexpensively over the air and opposed proposals to shut down transmitters. Canadians value local news, with a CRTC commissioned poll putting the number who consider it ‘important’ at 81%.”

Arnish also made clear that cable companies should share the cost of local TV if small stations are to survive.

“Moreover, all things being equal, with the phase out of LPIF [Local Programming Improvement Fund] now complete, the SMITS Coalition stations as a group will be in the red this broadcast year, given the loss of the $5.4 million contributed by LPIF last year.”

Before retiring last year, Arnish was Program Director at CFJC TV and General Manager of Broadcast Centre and later President of the Jim Pattison Broadcast Group.

The internet transmits the content from traditional sources without paying for its creation. Unlike the old aether which radiated local programming, the new aether sucks the life from local TV.

Removal of links and the death of history on the internet

Convicted killer Clifford Olson would probably have preferred that any account of his murder of eleven children and young people in the 1980s removed from the internet. Links such as this Wikipedia article which detail the grisly horror.

Courtesy of Gizmodo

Courtesy of Gizmodo

A B.C. technology company also wants links removed for a completely different reason. Equustek’s wants Google to remove links to a competitor’s website. Equustek successfully sued that competitor for theft of their hardware design but the competitor persisted on selling it online. The B.C. Supreme Court ruled in 2014 that Google had to comply with Equustek’s request and remove the links. Google complied reluctantly.

However, the court order lays bare a much bigger problem than murder or industrial theft –the erasure of history on the internet. At issue is whether anyone, of motives pure or corrupt, should be able to remove records of significant historical events. Katherine Maher from Wikipedia worries about the jurisdiction of any court to remove history.

“If any country can demand the worldwide removal of search results, vast sections of history, science and culture could disappear from the global Internet. This could infringe on our ability to learn about the history of Tiananmen Square, the potential medical properties of cannabis, the discoveries of Darwin, or unsavoury allegations against the U.S. president-elect (Globe and Mail, Dec 9, 2016).”

Google doesn’t think it’s fair either and has taken their case to the Supreme Court of Canada where issue is currently being deliberated.

But Google is just the messenger. They don’t make webpages, they just find them.  While I’m reluctant to defend global corporate giants, I’m on Google’s side on this one. So are lawyers Ivo Entchev and Jeremy Opoplsky. Not only has the Google been “deputized” to carry out duties of Canadian law but Google is not even incorporated in B.C.

“Google did nothing wrong, but is being forced to bear the cost and responsibility to fix the problem.” “Moreover, Google is concerned by the prospect that court orders from a single jurisdiction can require the search engine to change its worldwide results Globe and Mail Dec. 11, 2016).”

So far, the Supreme Court sees only the little picture. Dissuaded by the threat to history and Google’s argument that the court doesn’t have global jurisdictions, Justice Rosalie Abella was sympathetic to arguments from Equustek’s lawyer.

“Just looking at it from the public interest point of view and the public perception point of view, you really think the public is going to line up behind the right to distribute internationally illegal contraband?” Justice Rosalie Abella asked, “What’s the harm to Google in preventing illegal activity in its wide distributive reach (Globe and Mail, Dec. 6, 2016)?”

If I may respond, Madame Abella, the harm in preventing illegal activity through the deletion of links is that search engines are not the problem. Google is simply shining a spotlight on the grimy nooks and interesting crannies of the world; some of them are illegitimate businesses that well-intentioned Equustek would like to eliminate; others that murderers, tyrants and presidents-elect would prefer remain unseen.

The CTF doesn’t speak for this taxpayer

Given the amount of media attention that the Canadian Taxpayers Federation gets, you would think that their members would be legion. But no, there are only five.

Sign in Calgary paid for by CTF

Sign in Calgary paid for by CTF

While there are thousands of donors, they have no say in the running of the CTF. Sensitive to the charge that they are an Astroturf organization –a fake grassroots group–  CTF spokesman Scott Hennig responded with Setting the record straight: how the CTF is governed.

“From time to time, some folks claim the CTF is not a grassroots organization because we have ‘five members,'” he wrote. “The truth is that we sometimes have four, sometimes six and currently we have five. According to our bylaws we can have as few as three and as many as 20.”

That’s a pretty weak defence. To quibble over the actual small number of members is to ignore the point. The problem is that the CTF doesn’t hold annual meetings in which members can discuss policy and elect board members. The CTF argues that democracy is too messy.

“Many reading this will have sat through the AGM of a broad member-based organization where two hours is spent arguing over some small change to the bylaws. Well intended to be sure, but largely a waste of time and at the end of the meeting half the attendees leave disappointed and disillusioned.”

Henning justifies the top-down approach by comparing the CTF with other not-for-profits and charities such as the Canadian Civil Liberties Association.

This is a false correlation. The Canadian Civil Liberties Association advocates for the civil liberties of all. The CTF advocates for only some taxpayers.

They don’t represent this taxpayer. The assumption of the CTF is that taxes are a bad idea. I gladly pay taxes, not just because I receive good value in return in the form of health care, schools, roads and infrastructure, but because good countries are well-financed. It’s the price of civilization. The governor of Vermont expressed this idea a long time ago:

“Taxation is the price which we pay for civilization, for our social, civil and political institutions, for the security of life and property, and without which, we must resort to the law of force (1852).”

The CTF doesn’t represent others either: those who pay no taxes such as the working poor, stay-at-home parents, and children.

Blogger Dougald Lamont has a problem with the emphasis of taxpayers’ issues over other citizens:

“Defining taxpayers as the only people who matter has real and serious consequences for policy. It is not a politically neutral position: it is a fairly radical right-wing ideology that drives inequality by making the rich richer while neglecting the poor.”

The CTF is disingenuous when it claims to be non-political. You only have to look at past directors to realize their libertarian bent. They include former Conservative Jason Kenney, members of the Saskatchewan Party, Wildrose and Reform parties, the Fraser Institute and press secretary for Rob Ford.

The CTF is welcome to express its anti-government views. But this taxpayer wishes not to be lumped in with their ilk. Media should refer to them as “a right-wing lobby group.”

Merge CBC with Canada Post

 

The CBC and Canada Post are both in the business of delivering information, so why not bring them together into a single entity?

Canada Post/CBC

Canada Post/CBC

They are both crown corporations; they are both undergoing radical transitions to digital communication; and each has what the other could use.

Canada Post has 6,200 public and privately-operated offices across Canada. CBC has hundreds of TV and radio transmitters. Canada Post serves a larger area than any other country. CBC broadcasts to every corner of Canada in English, French and eight aboriginal languages.

The new entity, the Canadian Communication Corporation would not only consolidate the resources of the CBC and Canada Post, it would expand into the mobile wireless business to provide some needed competition.

Canadians now pay some of the highest cell phone prices for some of the worst service in the industrialized world, reports the Huffington Post (July 18. 2013). In a study of prices in 34 OECD countries, Canada is 25th for high priced wireless phones. We are dead last when it comes to the number of people owning a cell phone.

The former Conservative government tried without success to encourage more independent wireless carriers into the market. The CCC would sell phones at Canada Post outlets and use CBC transmission towers to carry the service. For example, a customer in Iqaluit, Nunavut, could pick up the phone at the post office and receive service from a cell transmitter mounted on the tower that broadcasts CBM-FM-3.

Canada’s North lags behind in internet access. Nunavut tourism advises “Internet service is limited in Nunavut and slower than elsewhere. Wi-Fi service is uncommon. Visitors to Nunavut should not plan to spend much time on the internet.”

Professor Dwayne Winseck of Carleton University lists other advantages of the CCC: “Blanket cities with open access, lighting up the vast stock of underused and unused municipal dark fibre (CCPA Monitor, July/August, 2016).” By “dark fibre,” he means optical fibre that is not being used to capacity. As I reported in my column Kamloops Community Network -a vision unfulfilled, (July 22, 2014), Kamloops has a lot of dark fibre, the legacy of bold plan of former city technology manager Frank Mayhood.

“Extend public Wi-Fi in cities across Canada,” adds Winseck, “and broadband access to underused and unserved people in rural, remote and poor urban areas.” Rural service is not a luxury; it’s a necessity in business and education. The mayor of Caledon, Ontario, says that some students have their parents drive to the parking lot of a public library just so they can upload homework assignments (National Post, November 23, 2015.

The Trudeau government will give $16 million to internet service providers in B.C. to provide better rural access. If it makes sense to provide give money to private providers, it makes even more sense to invest in the CCC.

While there is a scarcity of internet service in Canada, there is also a looming news crisis. The CCC could not only deliver the news, it could produce it through the CBC’s capacity.

The business model of news delivery is failing as we get news echoed from ever fewer sources. A newly configured public broadcaster could fill that vacuum.

Another nail in the news coffin

I worry that Millennials are not getting the amount of news that my generation did. They are not getting it from newspapers, news websites, or from any traditional source says a study from the American Press Institute:

newspapers-rip

“Much of the concern has come from data that suggest adults age 18-34 — so-called Millennials — do not visit news sites, read print newspapers, watch television news, or seek out news in great numbers.”

Instead, this generation spends more time with their phones on social networks. The concern is that Millennials’ awareness of the world is narrow; that their discovery of events is incidental and passive; that news is just one of many random elements in a social feed.

Rather than going directly to news providers, this generation’s news is woven into a continuous connection to the world. It’s mixed into their social connection, into problem solving, social action, and entertainment.

My worry goes beyond any one news source to the necessity of news for an informed citizenry. It’s one of the keystones of a democracy. It’s so important that freedom of the press is enshrined in many constitutions. But what good is freedom of the press when the press ceases to exist?

What makes me optimistic is that, while the source of news may not traditional, their thirst for news is. In a survey done by the Institute, 85 per cent of millennials agree that “keeping up with the news is at least somewhat important to them,” and that 69 per cent “get news daily.”

Less encouraging is that only 40 per cent “pay for at least one news-specific service, app, or digital subscription.”

This is the way the news dies. Contrary to popular opinion, there is no free news. With the demise of newspapers, reporters are laid off. News websites employ only a few reporters because advertising doesn’t support more. Fewer reporters mean less investigative reporting. Less investigative reporting means that the seedy underbelly of the corporate and political world is never exposed.

If I supported conspiracy theories, and I don’t, I would concoct a conspiracy in which big business and corrupt politicians have brought down newspapers and encouraged a paucity of news websites in order to keep their dirt from seeing the light of day.

Leah McLaren speaks for millennials in her newspaper column (yes, the dead tree news). She admits that she doesn’t get news from newspapers (yes, like the one she writes for) or websites. “Nope, most of us get our news and information from that endlessly unfurling, murky river of politicians, gossip and kitten videos known as social media. And that brings us to another, more pressing problem: How can we filter out all the crap.”

One way to filter out all the crap, she says, is ad-blockers. While admitting that ad-blockers remove and ad revenue, the life line of a website, it gets rid of the annoying expense that eats up time, patience, and data limits. But why would advertisers pay for websites if their ads won’t be seen?

The death of newspapers was one blow. Ad-blockers are another nail in the news coffin.