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Regulating Netflix

11:10 AM -- Canada's Shaw Communications Inc. is urging the Canadian Radio-television and Telecommunications Commission (CRTC) to regulate some portions of the Internet, including video-driven services from Netflix Inc. (Nasdaq: NFLX), Hulu LLC , and Google (Nasdaq: GOOG).

Shaw, which owns cable, satellite-TV, and broadcast-TV operations, reportedly told a Commons heritage committee last week that those foreign services are "undermining" the ability of Canadian broadcasters to pay for domestic content and sapping their revenue streams. Shaw pays about $150 million annually for local content and to help keep producers flush through the Canadian Media Fund. (See Shaw Puts Up $2B for Canwest.)

"Why should we be burdened with anchors and costs? The reason Netflix can offer an $8.99 service is because they have no costs other than acquiring the content," Shaw president Peter Bissonnette said, according to The Globe and Mail.

His concerns are being raised weeks after Netflix launched a streaming-only service for the Canadian market. (See Netflix Streams to Canada .)

Bissonnette told the committee that Netflix streaming is already consuming about 5 percent of Shaw's capacity. Shaw, like fellow MSO Rogers, employs a usage-based Internet service model that could eventually take hold in the US because the Federal Communications Commission (FCC) 's latest attempt at codifying network neutrality rules would apparently allow for it. (See Net Neutrality Sweep: Everyone's Ticked and Rogers Takes Internet Meter to the Masses.)

— Jeff Baumgartner, Site Editor, Light Reading Cable

Jeff Baumgartner 12/5/2012 | 4:16:29 PM
re: Regulating Netflix

Nice try at a double dip, eh?  Interesting that Canadian MSOs can tap usage-based billing models to help recoup network upgrade costs... but Shaw's also trying to protect its bcast TV biz.   And they have a satelite TV biz, so we'll see how they think Netflix is doing harm to that one, too. JB

Jeff Baumgartner 12/5/2012 | 4:16:32 PM
re: Regulating Netflix

Heh, nice double-dip, eh? They're already charging extra up north for bandwidth overages and those  dollars should help fund requisite network upgrades. You'd think that would be enough, but guess not for Shaw, since they are also trying to protect their bcast TV interests. JB


 

Jeff Baumgartner 12/5/2012 | 4:16:32 PM
re: Regulating Netflix

Heh, nice double-dip, eh? They're already charging extra up north for bandwidth overages and those  dollars should help fund requisite network upgrades. You'd think that would be enough, but guess not for Shaw, since they are also trying to protect their bcast TV interests. JB

ycurrent 12/5/2012 | 4:16:33 PM
re: Regulating Netflix

So, you charge for usage and then complain about the network burden? How unCanadian.

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