Professor Geist gets it

Professor Michael Geist holds the Canada Research Chair in internet and E-commerce Law at the University of Ottawa’s Faculty of Law; he is a frequent commentator on the internet and the law.

In an opinion piece in the Globe and Mail he says that the CRTC (the Canadian Radio-television and Telecommunications Commission), the agency responsible for the non-technical regulation of telecommunications services in Canada and the broadcasting industry and its political supports all “have it backward. It may be true that the broadcasting system is (or will soon be) the internet, but the internet is not the broadcasting system. Indeed, the decision to treat the internet as indistinguishable from broadcast for regulatory purposes has sent the CRTC down a deeply troubling path that is likely to result in less competition, increased consumer costs and dubious regulation.

The CRTC, Professor Geist explains, “envisions new fees attached to virtually anything related to the internet: internet service providers, internet video services, and internet audio services (wherever located) to name a few.

It’s not the fees that bother me … I’m prepared to pay additional “entertainment” taxes but, as Michael Geist says, the Commission’s “own data contradicts [it’s] conclusion,[that] internet access is “almost wholly driven by demand for audio and video content,” since it also notes that 75 per cent of wireless internet traffic is not audio or video. The reality is that internet use is about far more than streaming videos or listening to music. Those are obviously popular activities, but numerous studies point to the fact that they are not nearly as popular as communicating through messaging and social networks, electronic commerce, internet banking, or searching for news, weather, and other information.”

That’s the kicker, the CRTC proposes to tax you and me for reading information on-line, for reading this blog, for example. It plans to tax my daughter for doing academic research on the internet and for sending messages to her friends.

There are,” Professor Geist says, and I fully agree, “several significant problems with viewing the internet through the prism of a broadcasting system.” He list three:

  • “First, the CRTC mistakenly thinks that since (a) it regulates broadcast and (b) broadcast is now the internet, then (c) it must now regulate the internet. However, given that the internet is much more than just broadcast, the CRTC’s proposal means that it would attempt to regulate far more than the broadcasting sector.
  • “Second,” he explain, and again I agree,  “the taxation (or mandated contributions) for cable and broadcast to support Canadian content production are at least premised on the fact that a cable subscription provides little other than access to broadcast content. The internet offers a limitless array of possibilities that have nothing to do with broadcasting, however, rendering the policy link far more tenuous. Governments can (and do) support the creation of Canadian content through grants, tax credits, and other subsidies, but foisting support on a monthly internet or wireless bill stretches the definition of the conventional broadcast system beyond recognition.
  • Third,” Michael Geist says, “precisely because the internet is such an integral part of our daily lives, ensuring universal, affordable access is a competing policy goal that should not be so easily discarded. But the CRTC provides little more than an unconvincing assurance that the impact of new internet taxes will be “cost-neutral”, even though Canadians who only rely on internet access will clearly pay more under the proposed approach. The government has handed this policy conflict to its review panel, asking it to consider new ways to support the creation of Canadian content while at the same time confirming that it opposes an “approach that increases the cost of services to Canadians.

The Commissions and, I presume, the Liberal government it advises, wants to tax the internet to increase support for Canadian culture while telling us all that it will be “cost-neutral,” whatever that might mean. This is bad public policy and I encourage my Canadian readers to write to you Member of Parliament and tell her or him to read Professor Geist’s column and to tell this government to tell the Commission to go back to the drawing board and start from a correct assumption about the nature of the internet.

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