Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Canada Competition Bureau supports proposal for unbundled video-on-demand service, (Apr 28, 2015)

By Edward L. Puzzo, J.D.

The Canada Competition Bureau supports a proposal by the Canadian Radio-television and Telecommunications Commission (CRTC) for the creation of a new hybrid video-on-demand (VOD) service category, the Bureau announced yesterday. The proposal would allow consumers to purchase online video-on-demand services without also being required to purchase additional services—such as a TV service (BDU) or an Internet connection (ISP)—from a specific service provider.

The Competition Bureau, responding to the CRTC’s request for comments on its proposal, believes that the proposed model benefits consumers by encouraging greater competition and providing increased choice and flexibility in how video content is viewed and obtained. Under this proposal, Canadian video-on-demand services would be able to compete on an equal footing with online video services (such as Netflix) and under a lighter regulatory regime, as long as they are available to all Canadians over the Internet.

Restricting access to online VOD services to those customers who purchase another service from a particular BDU or ISP increases costs to consumers, the Competition Bureau stated. Increased costs effectively limit consumer choice in regard to what content they consume and how they do so. Similarly, in the case where access to online VOD services is dependent on a subscription to a BDU service, choice is limited by requiring that a consumer subscribe to a BDU service even if he or she does not wish to do so. The Hybrid VOD model, if adopted by operators of online VOD services, will allow consumers to maximize the value of their services by subscribing to only the services that they want and choosing the ISP or BDU that they please without giving up access to the online VOD content they want to access.

News: Antitrust