A day later and I realize that the admonition to “do nothing” should be limited to not amalgamating the Broadcasting Act with the Telecommunications Act. The rest of the scheme I propose is an active engagement with the meaning of the Internet.
At the conference at the University of Ottawa yesterday I made sure to be clear that I have no concern with the subsidization of culture by the state; Canada already spends several hundreds of millions a year on TV and movies. (I wish we spent the same on naval construction, we could get a helicopter-equipped guided missile frigate every year for what we spend on subsidizing TV). What can no longer be assumed is that the regulated broadcasting sector will continue to be the engine that drives the cycle of subsidies and tax credits.
Since the debate at the Law Society a couple of weeks ago I have been shocked at the sense of entitlement of the advocates of Canadian culture. They believe that an architecture of control can be set up through ISPs, and that the Netflixes of this world can be captured by Canadian jurisdiction, without harm to free speech. Or if it harms free speech they appear not to know or care.
Many impediments stand in the way of having Netflix taxed to subsidize Canadian TV production. My colleague Mr. Palmer holds that it is not within the power of the federal parliament to assign to the CRTC the power to regulate point to point communication. Doubtless if the CRTC seeks to extend its jurisdiction over the Internet by active regulatory measures, including so-called “exemption” orders, the constitutional challenge will be engaged.
Other impediments are possibly more practical. The major one is that the Canadian appetite for Netflix does not generate a stream of money sufficiently large to be of much use to the Canadian cultural mafia. Dwayne Winseck of Carleton University made a rough guess as to how much revenue Netflix obtains from Canada. Multiplying monthly rates times 12 months of a year and an assumed number of Canadian subscribers did not generate more than $200 million (I stand to be corrected as to this number) and assuming a ten percent tax on that you would get $20 million. Whether Canadians would stand for a tax of this nature is an open question, to say the least.
What has disappointed me is that indifference of the cultural subsidy-seekers to the freedom of people to communicate. I do not think that sending video across the Internet should face more regulation than when you compose an email. The cultural lobby thinks it is an activity that should be licensed, and if not licensed then exempted and taxed. That people will be vexed by this possibility, they show no signs of concern. Canada is a giant ATM machine designed to produce subsidies for their economic interests. If that reminds you of large-L Liberals, of the “I am entitled to my entitlements” school of thought, you would be accurate.
I am in favour of a domestic Canadian television industry; and I have no philosophical objection to subsidizing it. But the problem the TV production industry is facing is not to be solved at the expense of our freedom to communicate without a state licence. The advocates of the TV production industry do not appear to care. And that is why fans of the Internet need to resist the rent-seekers’ claims until the rent-seekers come to their senses.