Internet price hikes could be coming as Ottawa reviews cultural policy, critics warn
Federal government could consider a levy for internet providers to fund Canadian content
Like it or not, your internet bill might soon go up to help pay for something you may not care all that much about — Canadian content.
The federal government has launched a massive review of Canadian-made content in the digital age that will include who should be footing the bill.
One option on the table: a mandatory contribution or so-called tax on internet service providers (ISPs) to help fund home-grown programming.
- Mélanie Joly asks about CanCon rules for a digital age
For decades, cable and satellite TV providers have had to contribute funds to create domestic programs. The idea is simple: if we support Canadian storytelling, we help preserve our culture and identity.
But critics claim an added internet levy is not a wise move for Canada. They believe the fee would be passed on to customers, making a vital service cost prohibitive for some.
"We need to make sure the internet is more accessible to Canadians, not less," said Josh Tabish with Vancouver-based Open Media, an internet advocacy group.
Proponents argue the proposed levy doesn't automatically translate into higher prices for consumers.
That's because, rather than a "tax," this would be a "contribution" paid by ISPs, which are well positioned to help fund Canadian programming, argues the Writers Guild of Canada.
ISPs "are reaping significant financial benefits from streaming as consumers buy more bandwidth" to watch content online, said executive director Maureen Parker in an email to CBC News.
Time for an internet tax?
Concerns about an internet tax erupted soon after Canadian Heritage announced it was putting Canadian content rules under the microscope.
"The time is ripe to review the role of the federal government in helping Canada's creative sector," Canada's Heritage Minister Mélanie Joly said in a statement in August.
In 2008, some arts and culture organizations floated the idea of a 2.5 per cent levy on ISP revenues to help fund the creation of Canadian programming for new media.
Tabish says he has good reason to believe the government may be ready to move forward on the levy in some form.
"We've heard from insider sources that this idea is being taken very seriously. And that it could all come to a head quite quickly."
CBC News asked Canadian Heritage about the prospect of ISP contributions in light of its policy review.
"It is premature to speculate on any potential outcomes," said spokesman Tim Warmington in an email to CBC News.
Canadian content at what price?
While Tabish says he supports Canadian content funding, he believes the internet should be left untouched.
He's convinced the proposed tax or contribution or whatever form it would take would inevitably lead to ISPs charging customers more.
"Their own self-interest and responsibility to shareholders has them duty-bound."
And higher internet bills, he claims, would be a problem.
According to a recent CRTC open survey of 29,000 Canadians, 11 per cent of respondents had no home internet service, and many people who are connected say they struggle with the cost.
Amber Slegtenhorst in Ottawa claims she can barely afford her monthly bill for internet service for her family of five children.
"Sixty dollars a month is a lot of money. I've got six mouths to feed including myself," says the single mother.
Slegtenhorst also says she can't afford to live without internet access. "It's a staple of life. The way we communicate."
Tabish argues people like Slegtenhorst could lose out if prices go up. University of Ottawa law professor and internet legal expert Michael Geist agrees.
"The ISP tax would come at an enormous cost to other policy priorities," he stated in a column last week.
"Internet access would become less affordable, expanding the digital divide by placing connectivity beyond the financial reach of more low-income Canadians."
It's not a 'tax'
But some cultural organizations argue that Canadians must stop thinking of the proposed ISP contribution as a "tax" on consumers — terminology created, they say, by the previous Conservative government.
"This language was designed to scare people," said ACTRA spokesman Elliott Anderson in an email.
Anderson points out that TV broadcasters already make contributions. He adds that the world is shifting as more people turn to the internet to watch content.
"It makes sense that the companies profiting from this shift should contribute to production funds — just as traditional broadcasters do," said Anderson.
"To ensure sustainable funding and keep Canada's creative industry strong, we need new ideas."
In 2012, the Supreme Court of Canada ruled that ISPs aren't subject to the same rules as Canada's broadcasters.
But Geist says minister Joly could change the law to force ISPs to pony up contributions as well.
CBC News asked the major internet providers for their thoughts on contributing to Canadian content. Only Quebec's Videotron responded.
The telco said that while it didn't support an ISP tax, it would support a sales tax on foreign online services like Netflix.
Tabish also supports a foreign sales tax as an alternative solution.