CRTC WON’T REGULATE THE INTERNET

News Release

May 17, 1999

OTTAWA-HULL — The Canadian Radio-television and Telecommunications Commission (CRTC) announced today that it will not regulate new media services on the Internet.

After conducting an in-depth review under the Broadcasting Act and the Telecommunications Act beginning last July, the CRTC has concluded that the new media on the Internet are achieving the goals of the Broadcasting Act and are vibrant, highly competitive and successful without regulation. The CRTC is concerned that any attempt to regulate Canadian new media might put the industry at a competitive disadvantage in the global marketplace.

"By not regulating, we hope to support the growth of new media services in Canada," says Françoise Bertrand, CRTC Chairperson. "The CRTC is one of the first regulators in the world to clarify its position on the Internet."

Broadcasting

Regarding whether content on the Internet is broadcasting as defined by the Broadcasting Act, the CRTC has made the following points:

1. Everything transmitted over the Internet that is predominantly alphanumeric text is by definition not broadcasting under the Broadcasting Act.
2. Material transmitted over the Internet, which is significantly "customizable" or capable of being uniquely tailored by the individual user, does not involve the transmission of programs for reception by the public and is, therefore, not broadcasting.
3. The remaining material would fall within the definition of broadcasting under the Broadcasting Act, but will be exempt from regulation for the following reasons:

* The new media complement, rather than substitute for traditional broadcasting. Before the new media could substitute for traditional media, key technological and other developments would have to take place.

* The Commission does not believe that regulation of the new media would further the objectives of the Broadcasting Act.

* There is a substantial Canadian presence on the Internet today, supported by demand for Canadian new media content.

* Ample business and market incentives exist for the continued production and distribution of Canadian new media content.

* The new media industry requires local Canadian content to develop their businesses.

* Both the Federal and Provincial governments have initiatives in place to support Canadian content on the Internet.

* Generally applicable Canadian laws, industry self regulation, content filtering software as well as increased media awareness are appropriate tools to deal with offensive and illegal content on the Internet.

"Our message is clear. We are not regulating any portion of the Internet," says Françoise Bertrand.

Telecommunications

Two main telecommunications issues were raised during the hearing, which the Commission is already examining:

1. The Commission is already mandating access to the high-speed local facilities of telecommunications and cable companies at tariffed rates for, among others, retail level Internet service providers. The Commission will shortly issue its decision regarding the specific regulatory approach for high-speed access on cable.
2. Concerns were also raised about the ability of Canadian citizens and consumers to access the Internet at reasonable costs. The Commission will be addressing some of these concerns in the context of its proceeding on telephone service in high-cost serving areas.