Evidence of meeting #30 for Canadian Heritage in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was content.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Konrad W. von Finckenstein  Chair, Canadian Radio-television and Telecommunications Commission
Scott Hutton  Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission

4:45 p.m.

Conservative

The Chair Conservative Gary Schellenberger

Your time is up.

Mr. Chong.

4:45 p.m.

Conservative

Michael Chong Conservative Wellington—Halton Hills, ON

Thank you, Mr. Chair.

I just want to go back to our earlier discussion on new media. I think your fundamental challenge or problem is that, when the 1999 exemption order went into place, basically it was an acknowledgement at the time--and I still think it is valid today--that the government wasn't going to regulate IP-based packet-switched networks. The only countries that do that presently are not as free and open and transparent and democratic as ours. We don't regulate those big OC-3 lines or other big cables coming across the border. Those packets come flying across those borders on those big cables and the Government of Canada, directly or indirectly through regulation, doesn't monitor those packets. There are countries that do that. They are far more authoritarian and less open than we are. So I think that it's going to be incredibly difficult, if not impossible, for governments to ever regulate packet-switched, IP-based networks.

I put that out there as a point, because I think you were right in your earlier testimony when you said the challenge here was not to regulate more but to ensure that Canadian voices are heard on broadcast media.

I note today that Research In Motion released its next generation of BlackBerry. It's going to work on the 3G networks. It's going to have a camera. It's going to have a video recorder. It's going to have enhanced web access. Apple has announced that this summer it's coming out with a new platform for the iPhone that will have enhanced multimedia capabilities. These are all on packet-switched, IP-based networks.

I put the point out there, just as a comment, that maybe we need to look at it from the other end, as you suggested. Maybe the solution isn't more regulation, but rather for governments at some future date to say, “Look, we're entering into an era now where foreign media will be ubiquitous within our country because of these IP-based networks, and as a result, we're going to take a look at putting more resources into the public broadcaster to allow and ensure that Canadian voices continue to be heard within our own country.”

4:50 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

Once again, I'm quite sure there's no silver bullet for the issue of the challenge of new media. We're going to deal with it on all sorts of fronts. It's part of the reason we're having this hearing. As you point out, maybe the idea is to put more emphasis on public broadcasting. Maybe the idea is to establish more of a regime of subsidies or incentives, rather than trying to control access, etc. I honestly don't know.

And the timing is so very difficult. As Mr. Abbott said, there are technological constraints right now, and nobody knows whether they're going to be here for five years or five months. That's what makes our task so challenging and so urgent. I agree absolutely with Mrs. Fry that we have to do this as quickly as we can.

4:50 p.m.

Conservative

The Chair Conservative Gary Schellenberger

Thank you.

Mr. Abbot is sharing some time here.

4:50 p.m.

Conservative

Jim Abbott Conservative Kootenay—Columbia, BC

The second-last paragraph in your presentation reads:A modern regulator needs AMPs powers in all areas under its mandate. If we are to regulate with a lighter hand, and to provide broadcasters and BDUs with more latitude, then we must have the tools to ensure that licensees live up to their responsibilities.

I think you're not quite like Mr. Carney in terms of your pronouncements, but I'm sure many people at the CAB and in the various BDUs hang on every word that you say, understandably. I wonder if you want to expand on this. Maybe there isn't a lot more, but it seems to me you're saying one heck of a lot there.

4:50 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

I have been saying this consistently. We have these two regimes: the telecom and the broadcasting. The telecom, as I say, is essentially market-oriented, where we step in for market failure, and it's an ex post sector regime.

On the cultural side, you will always have some sort of regulation because you are trying to achieve a cultural-social role. But we've done it with a very heavy bureaucratic hand. I want to make sure we do it as lightly as possible, that we interfere as little as possible, and do it in a targeted way, to the extent that their creative forces, their market forces, can be unleashed to produce. But I fully realize, since at the end of the day we're talking not about an economic goal but a cultural goal, there is going to be some sort of government intervention--let's put it that way.

4:50 p.m.

Conservative

The Chair Conservative Gary Schellenberger

Ms. Mourani.

4:50 p.m.

Bloc

Maria Mourani Bloc Ahuntsic, QC

Thank you, Mr. Chair.

I followed your presentation and I noted something that perhaps you will not agree with. Artists’ groups are complaining that the CRTC is heading towards deregulation. There is talk of a voluntary code. In the community, there is talk of deregulation.

Mr. Abbott raised a point I would like to discuss with you, that is, lighter regulation, which would offer greater freedom, take market forces into account and streamline the bureaucracy. When I hear all that, I am afraid of giving you more tools.

If there is a range of penalties, clearly there will be a tendency most often towards infractions entailing small penalties. Seldom if ever will extreme penalties going so far as suspension of a licence be imposed. It is well known that, where there is a range of penalties, people will always opt for a sort of halfway penalty that consists charging a series of small fines. At present, it is true that you do not have much choice: you can opt either for the minimum, or for the maximum.

Talk of deregulation, market forces and voluntary codes worries me. Perhaps it is better to keep the status quo. That way, there is not much choice. If someone repeatedly fails to abide by the regulations, at some point their licence must taken away. When people no long understand and just do whatever they feel like, maybe they should lose their licence.

4:55 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

We must concentrate on the most important things, on content and access. This is the main objective of the current broadcasting system. We must be able to force people to comply with the regulations. In my speeches, I always say that broadcasting will always be regulated. I said it again two minutes ago. For me, this objective is clear and it is not economic. The market is not what will make it possible for us to achieve this objective.

I would like our regulation to be light and targeted. That is what counts. I can tell someone who has not complied with the regulations that I do not want to revoke their licence, but that it will only be renewed for three years instead of seven, for instance. The licensee could then say that in three years another renewal will be granted. In actual fact, there is not any penalty.

4:55 p.m.

Bloc

Maria Mourani Bloc Ahuntsic, QC

You say that, since the penalties are either extreme or minimal, there is no penalty. But even if the penalties are major, they should not be imposed less. If I commit a murder, I will get a sentence of life imprisonment. If I am caught shoplifting or if I attack my colleague here, I will have another sort of sentence. Of course, if someone breaches the conditions of their licence ten times, their licence will be suspended. The people who hold licences, however, earn millions of dollars. For them, a fine of $3,000 or $5,000 is nothing, but taking away their licence is something else.

Will the variation in penalties induce you to be more tolerant and wait before imposing an extreme penalty?

4:55 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

Not at all. First of all, we must not forget about the public interest. If we revoke a licence, the public will suffer and we want to avoid that. We do not wish to punish a broadcaster’s audience. Second, the fine will be stiffer.

Perhaps my colleague could explain how the system operates.

4:55 p.m.

Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission

Scott Hutton

We want to add AMPs to our other methods, not to replace them. I do not think that we will back down or be less insistent. It is an additional method.

I am going to make an analogy with what you have just said. We have a penalty for murder, but not for shoplifting. We do not have this sort of penalty, and that is what we are seeking. The last time we discussed bill C-327, we suggested a maximum penalty of $200,000 for a first infraction and $400,000 for a second one. These are pretty hefty amounts.

4:55 p.m.

Conservative

The Chair Conservative Gary Schellenberger

Your time is pretty well up.

Mr. Siksay.

4:55 p.m.

NDP

Bill Siksay NDP Burnaby—Douglas, BC

Thank you, Chair.

When the CRTC applies an AMP and collects on it, where does that money end up?

4:55 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

Like all penalties, it goes to the central revenue fund.

4:55 p.m.

NDP

Bill Siksay NDP Burnaby—Douglas, BC

Say the penalty was related to a violation of broadcast standards around violence on television. Would it be appropriate to direct some of that to media literacy education, for instance, since that was one of the aspects of the problem we heard about when we were discussing Mr. Bigras' private member's bill?

5 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

We don't generally do that because it can give perverse incentives to the regulator. That's why the rule is very simple. Of course, when there's a violation and a fine is paid it goes to the CRF so you, as a regulator, do not benefit from convicting somebody or determining the amount, etc. I think that's a very sound rule, and I wouldn't play with it.

5 p.m.

NDP

Bill Siksay NDP Burnaby—Douglas, BC

How would doing media literacy education be seen as a perverse incentive?

5 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

Well, that way the money stays in the domain of broadcasting and it furthers an activity that we favour. If the fine didn't go there, we would have to find the money somewhere else, and the benefits, etc. It could give the appearance of perverse incentives.

5 p.m.

NDP

Bill Siksay NDP Burnaby—Douglas, BC

Okay, thank you.

In terms of what you're proposing in terms of AMPs under the Broadcasting Act, how do they compare with what exists now under the Telecommunications Act and under the “do not call” list?

5 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

Scott, do you want to answer that?

5 p.m.

Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission

Scott Hutton

What we proposed in Bill C-327 is certainly lesser than what we have under the Telecommunications Act. The primary reason, as indicated earlier, is that in the Broadcasting Act there are criminal provisions that are set at certain levels. They're set higher for telecom. A case in point is that revenues are higher in telecom than in broadcasting, so we have to go one step back from that.

5 p.m.

Conservative

The Chair Conservative Gary Schellenberger

Do you have any more questions? Thank you.

I'm going to go back to the time before. Our fourth round would have been the Liberals for five minutes and the Conservatives for five minutes.

One short question, Mr. Pacetti. I know I cut you off a little early. Then we'll go to Mr. Chong.

5 p.m.

Liberal

Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC

Thank you.

Previously you said that the TQS is now operating under a temporary licence. Is that right?

5 p.m.

Chair, Canadian Radio-television and Telecommunications Commission

Konrad W. von Finckenstein

Yes. What happened is that Ramstar, as you know, was successful. TQS went bankrupt. It was then operating under bankruptcy protection. It was sold and Ramstar was the successful bidder. We gave a temporary licence to Ramstar so it could operate it while we held the hearing. Otherwise it would be off the air.