Independent Broadcast Group/ Le Groupe de diffuseurs indépendants , Ottawa, Ontario K1N 5H7 122 Guigues Avenue, Ottawa, Ontario K1N 5H7 Telephone: 1(613) 680-0915 September 13, 2022 Vincent Labrosse Clerk Standing Senate Committee on Transport and Communications The Senate of Canada Ottawa, Ontario Canada, K1A 0A4 Dear Mr. Labrosse: Re: Bill C-11 – Online Streaming Act Independent Broadcast Group/Le groupe de diffuseurs indépendants ("IBG/GDI") is an association of independent Canadian broadcasters.

Our members include: Aboriginal Peoples Television Network Channel Zero Ethnic Channels Group Groupe Média TFO Hollywood Suite OUTtv Network Pelmorex Communications Sportsman Channel Canada Stingray Group Superchannel Telelatino Network TV5 Québec Canada Zoomer Media The association represents a wide diversity of voices in the Canadian broadcasting system with members active in all broadcasting sectors. IBG/GDI fully supports the Online Streaming Act. We are pleased to provide the attached backgrounder and proposed amendments for the Committee's consideration in its review of the Bill.

As it stands now, the Bill will seriously restrict the CRTC's authority to supervise a critical element of online activity: the distribution, discoverability and fair treatment of Canadian apps and services online. A small number of targeted changes to the Bill are necessary to ensure the CRTC will have the tools it needs to ensure Canadian services and apps are distributed to Canadians, made prominent and treated fairly by online distributors. 1.

The CRTC must have the authority to set terms and conditions for the distribution of Canadian services on online distribution platforms – this is a critical backstop power for

, Ottawa, Ontario K1N 5H7 - 2 - the CRTC and essential to support fundamental public interest services such as APTN, TV5/UNIS, Accessible Media and public alerting. 2. The CRTC has to be able to establish general rules to govern distribution so that it can regulate in a flexible way and respond to how distribution platforms develop in the future. 3. Last, the CRTC has to have the ability to resolve disputes regarding online distribution of media services.

The Broadcasting Act – together with the Online Streaming Act – will set out the framework to ensure that our broadcasting system serves the interests of all Canadians. The framework must be up to the task. Thank you for the opportunity to provide the attached background information and proposed amendments. Yours truly, Joel R. Fortune Legal Counsel

Independent Broadcast Group/ Le Groupe de diffuseurs indépendants Telephone: 1(613) 680-0915 Telephone: 1(613) 680-0915 Telephone: 1(613) 680-0915 Bill C-11: The Online Streaming Act – Backgrounder The Issue: Bill C-11 goes a long way to update the Broadcasting Act to ensure that online broadcasting services support Canada's broadcasting policy objectives. But there remains a serious concern: the Bill restricts the CRTC’s authority to supervise a critical element of online activity – the oversight of the distribution, discoverability and fair treatment of Canadian apps and services online. As a result: 1.

Distributors of programming services and apps using different technologies to perform similar functions cannot be treated similarly – one of the Government's key objectives. 2. The CRTC cannot ensure that Canadian programming services and apps are distributed to Canadians, made prominent and treated fairly by online distributors. 3. Canada will lose the contribution that Canadian services and apps make to Canadian culture and to the Canadian economy. Canadian services develop, produce and exhibit a full range of Canadian programming – in English, French, Indigenous languages and a wide range of third languages.

They serve all Canadians in our society. They are the primary guardians of Canada's cultural sovereignty in the audio and audio-visual sectors. Canadian services employ thousands of Canadians and contribute billions to our economy. Global platforms like Disney+, Netflix, Amazon and others are no substitute for the diversity, depth of content and economic benefit provided to Canadians by Canada's own broadcasting services. We cannot rely on foreign services to do what Canadian broadcasters do.

The objective of amending the Broadcasting Act must be to make it better and to ensure that Canadian services thrive in an online environment. The objective should be to futureproof Canada’s cultural sovereignty in our own media.

- 2 - The CRTC must have sufficient authority and appropriate scope for regulatory action under the Broadcasting Act to make sure that Canadian broadcasting policy objectives are met in the online world. Explanation: When Bill C-10 was first introduced, it significantly restricted the CRTC's existing authority over the online distribution of programming services and apps. Online distribution, in this sense, means aggregating and providing access to a number of different services and apps, in a manner that is comparable to what a cable system does.

Fortunately, changes were made to Bill C-10, now reflected in Bill C-11. But there are still harmful gaps. The remaining gaps: 1. The ability to set term and conditions of carriage for services by online distributors

Section 9.1(1)(

i) allows the CRTC to require an online distributor to distribute certain services, by order, but it does not allow the Commission to set terms and conditions relating to this distribution. Rather, these terms are to be negotiated in "good faith" (section 9.1(9)). The Commission may "facilitate" negotiations but does not have the authority to resolve a dispute (section 9.1(10)). The Commission should have the authority to set terms and conditions for carriage. This is a fundamental existing authority for the Commission.

It has enabled the launch and viability of key Canadian programming services that would otherwise not exist (such as APTN, TV5 Québec Canada and Unis, Accessible Media Inc., CPAC and the emergency alerting service provided by Weather Network/Météomédia). This power is also a fundamental "back stop" to the CRTC's ability to resolve disputes and establish a meaningful remedy in situations involving distributors and programming services. Without similar authority in an online environment, important Canadian programming services will not survive in the transition to online distribution. 2.

The authority to regulate in connection with the distribution of programming services for online undertakings in a parallel, if different, manner to established "distribution undertakings".

- 3 - Currently, the Commission has the authority to regulate the "carriage of any foreign or other programming services by distribution undertakings". But, this authority is limited to established "distribution undertakings" – i.e. cable and satellite not online distributors. This is a fundamental gap.

In the past, this authority has been essential to cover activities such as ensuring local television services are distributed locally; providing access to distribution platforms for multicultural Canadian programming services; providing access to distribution platforms for independent programming services; ensuring fair treatment of services and subscribers during disputes (e.g. the "standstill rule"); and providing for consumer protections. It is due to this authority to regulate distribution that we have the diverse broadcasting system that we have today.

Some online distributors perform exactly the same function as established distribution undertakings. They are often the same companies: Canada's largest media companies like Bell, Rogers, Shaw, Videotron, Telus and others are all engaged in migrating "closed" IPTV distribution technologies to the (theoretically) "open" Internet. These are the so-called "virtual BDUs" that appear and function the same as conventional BDUs, but use the Internet.

Without appropriate regulation of these "virtual BDUs" we will experience an unavoidable hollowing out of the Canadian broadcasting system as distributors migrate from "regulated closed" IPTV to notionally "unregulated open" IPTV and leave the Canadian broadcasting system behind. The current Bill actually creates an incentive to do just that. New distribution services are also being rolled out rapidly. Today, these are the app-based platforms that provide linear and on-demand services to subscribers.

The "app" functions as a portal providing access to multiple linear channels and on-demand content in virtually the same way as the EPG does today on cable and satellite platforms. The objective here is to ensure that the Commission has the authority to do what is necessary so that these services meet Canadian broadcasting policy objectives by offering Canadian programming services to Canadians when it is appropriate to do so. No one knows what future services will look like, but without a sufficient scope of authority, the CRTC will be unable to respond to future challenges in the online market. 3.

Dispute resolution should extend to online providers.

- 4 - The Commission has the authority now to resolve disputes between "distribution undertakings" and programming services. This authority does not extend to disputes involving online distribution. This is a fundamental problem with the Bill. Without this authority, the CRTC will have no ability to resolve disputes between services and online distributors and to create remedies that advance broadcasting policy objectives. They cannot set a dispute resolution framework and establish a “stand still” mechanism to protect consumers and to guard against unilateral actions based on unequal market power.

The dispute resolution tool is essential to resolving gatekeeping issues in the broadcasting distribution environment – whether it is a programming service seeking to access a key platform on fair terms; or a distributor seeking access to key programming content. These issues are endemic in any network environment including the Internet and compounded in Canada by the high level of concentration of ownership and cross- ownership in the communications sector and the unequalled scale of the global web giants.

The CRTC should have the authority to resolve disputes in an online environment to serve the public interest. Solution: A few key changes to Bill C-11 would address these issues. The proposed changes are attached. These changes do not require a particular regulatory action in relation to distribution activities. They do not prejudge an outcome. Rather, they preserve the CRTC’s authority to regulate appropriately in an online environment. The changes are intended to futureproof the Broadcasting Act so that it remains a flexible and effective instrument for the benefit of Canadians.

International Examples: The changes we have proposed are consistent with steps being taken in other jurisdictions to deal with online platforms.

In the United Kingdom, the government has announced it will make legislative changes to require online platforms to carry and give prominence to UK services, giving Ofcom a dispute resolution function to deal with online platforms. [See: the White Paper, Up Next: The Government's vision for the broadcasting sector (April 2022)] In the United States, the Federal Communications Commission has already asserted jurisdiction over online distributors, known as "virtual multichannel video programming distributors" – i.e. what we would call "virtual BDUs".

It has looked at whether local television carriage rules should apply to online services and this

- 5 - proceeding remains open. [See: Notice of Proposed Rulemaking FCC 14-210 Promoting Innnovation and Competition in the Provision of Multichannel Video Programming Distribution Services.] In other words, other major jurisdictions, including the U.S., are already seized of online distribution issues. Their expert regulatory agencies – Ofcom and the FCC – are exercising or preparing to exercise the authorities that IBG/GDI and others have proposed be included in Bill C-11. CRTC Support: These changes are the same or very similar to changes that the Commission itself has proposed be made to Bill C-11.

Chairperson Ian Scott appeared before the Senate Standing Committee on Transport and Communications on June 22, 2022. He said: [W]e have identified gaps between our powers to address certain situations in the traditional broadcasting system and similar situations in the digital environment. For instance, the CRTC currently helps resolve a variety of disputes through its mediation and arbitration services. Under Bill C-11, we would not have the same ability to support the industry in its negotiations and address imbalances in bargaining power.

It would make it much more difficult to resolve complaints quickly and efficiently. In addition, Bill C-11 would give the CRTC the ability to require that online broadcasting services offer Canadian programming services, but unlike our current powers, we would not be able to set any terms or conditions. This provision of the Broadcasting Act has served Canadians and the system as a whole very well, as evidenced by channels such as APTN and AMI-tv.

In our view, the CRTC should have a similar ability to ensure that Canadian programming services are able to gain access to online streaming platforms under fair and equitable terms. The good news is that the solution consists of simple amendments to Bill C-11, which we would be happy to provide to this Committee. The concerns raised by the CRTC Chair are similar or the same as the concerns that we have identified.

Independent Broadcast Group/ Le Groupe de diffuseurs indépendants Proposed Amendments to Bill C-11 1. Changes to proposed

section 9.1 regarding the distribution of specified services: 9.1(1)(

h) a requirement for a person carrying on a distribution undertaking or an online undertaking that provides the programming services of other broadcasting undertakings to carry, on the terms and conditions that the Commission considers appropriate, programming services specified by the Commission; Purpose: To enable the CRTC to ensure that specified Canadian apps and services are offered on online platforms. With this change, new

section 9.1(1)(i), 9.1(9) and 9.1(10) could be removed or modified. As an alternative, the existing provisions could be retained, and the Commission provided with explicit authority to set terms for online distribution where good faith negotiations have failed (as follows) 9.1(10) The Commission may facilitate those negotiations at the request of either party to the negotiations and, notwithstanding paragraph (1)(i), if no agreement is reached determine terms and conditions for carriage that the Commission considers appropriate. 2. Changes to proposed

section 9.1 regarding the general oversight of online distributors: 9.1(1)(l.1) the carriage of any foreign or other programming services; Purpose: To enable the CRTC to establish carriage conditions that apply to types of programming services in an online distribution environment (e.g. local services, multicultural services, independently owned services, minority language services) and to provide for other general regulatory oversight of online distribution. 3. Changes to the CRTC’s existing dispute resolution authority to reflect online distributors: 10(1)(

h) for resolving, by way of mediation or otherwise, any disputes arising between programming undertakings and distribution undertakings broadcasting undertakings concerning the carriage of programming services originated by the programming undertaking; Purpose: To ensure that the CRTC has authority to intervene in disputes regarding the carriage of programming services in an online environment.