Giving and receiving in the world of telecommunications

“They give you this but you pay for that.”

from My My, Hey Hey (Out of the Blue) by Neil Young

 

Are the best things in life free? That’s hard to say. Is anything really free?

Navigating one’s way through life requires constant awareness of whether payment is required for the needs and wants we seek to satisfy, and whether certain costs are immediate or delayed, direct or indirect.

The telecommunications industry is but a microcosm where these variances can be seen consistently.

Take cellphones, for example. Each of the major wireless carriers offers a selection of smartphones for free. Well, not really. You don’t pay up front for the cost of the phone; the carrier does. It might not feel like you’re not paying for that phone, but you will through your service plan over the length of the contact, if the carrier has a business model that’s designed to make money, which most do.

The above example fits the hypothesis of nothing being truly free, in that you’re going to pay for what you get eventually, even if it’s in a roundabout way. It’s kind of like health care in Canada. It’s not free, per se, even though you don’t get billed for basic services at a doctor’s office or hospital. This gets paid for by government, but you pay for government.

Then again, in the case of health care and other areas where users don’t pay directly for their services, there are those who get more than what they pay for and others who pay more proportionally to what they get.

As we reported this week in The Wire Report, WiFi networks are getting built (subscribers only) on public properties in some cities, which users can access without having to pay for the service. Even the local authorities that are arranging for these projects, rather than paying, are actually making money in deals that see tech companies building these networks and hoping to make back their money plus some profit from advertising.

So let’s break this scenario down. The individual doesn’t pay for the WiFi service, and neither does the local authority that’s facilitating the arrangements. Advertisers are paying the bills here, and they are the companies that make a living off of selling you goods and services. So essentially, the companies that are paying for your “free” WiFi are counting on getting their money back from you at some point. But then again, you might use a lot of public WiFi and hardly patronize the companies advertising on these networks, or you could be among their biggest customers and not be a WiFi user. Isn’t capitalism in the 2010s fascinating?

Still, after you factor out a number of demographic variables, such as age, wealth and whether you have kids to take to a recreation centre offering free WiFi, you’ve got to figure that, at the end of your life, you’re probably going to end up fairly even in the ratio of how much you pay versus how much you get.

The last two decades have seen a number of traditional media launch online versions of themselves. First it was print media and more recently it’s been TV.  The “freeness” of online content has changed throughout the years.

Not long ago, most mainstream news could be accessed without charge, but newspaper websites have increasingly erected paywalls as they found digital advertising alone wasn’t sustaining their businesses.

As for television, you might or might not find content you’re seeking for free on the user-supplied YouTube. But more and more, broadcasters are putting content on their own websites, though many require you to be a subscriber of a particular TV service before you access certain services, such as Shaw Communications’ newly launched History Go or Bell’s CTV Go.

But even with the “free” content you find online, you’re still paying for your Internet account or your wireless service. In many cases, you’re making the payment for the connection to the same company that’s providing the content. In other cases, service providers are benefiting from the popularity of content providers that become web destinations, such as newspapers, but many of these content providers have not yet figured out how to unlock monetization from this in a significant way.

Which is all to say that the kind of stuff we’re covering here means big money for some players and huge headaches for others. And it all turns into a game where the consumer tries to get what they can for little or no money, and the companies try their best to find someone — anybody — to pay for what they’re providing. Some succeed, others don’t.

Derek Abma is editor of The Wire Report. He can be reached at dabma@thewirereport.ca.

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How long can OTT services remain unregulated?

Since they made their entrance in the Canadian television sphere, Netflix and its over-the-top brethren have so far operated — quite literally — outside the rules.

But this week, the launch of the newest phase of the CRTC’s ongoing review of TV services brought up questions about whether the CRTC, which has long refused to regulate OTT services, may be about to change its mind.

First, on Tuesday, the commission released a questionnaire as part of the second phase of its ongoing consultation about TV services. As we reported (subscribers only), some of the questions hinted that the commission is mulling regulation after all.

For example, the questionnaire asks respondents whether they would be willing to pay an online service an additional 50 cents per month to have access to more Canadian programming, and whether online services should adhere to programming standards and provide closed-captioning.

Barry Kiefl, president of research group Canadian Media Research Inc., told the Wire Report in an interview that the CRTC may be considering regulation, especially given the growing presence of Netflix in Canada (which now reaches three million Canadian homes) and other competitors like the streaming movie service Crackle.

At the TV industry conference Prime Time, which took place this week, the impact of eyeballs moving online kept popping up as well.

Raja Khanna, chief executive at independent broadcaster Blue Ant Media, brought it up during a panel discussion on the CRTC’s TV review.

“It’s a misnomer to say YouTube is low-quality cats on skateboards. It’s not,” he said. “There is high, high quality programming there that is being funded by places other than television and it is being watched by millions of Canadians.”

Earlier in the week, speculation about regulation reached Jean-Pierre Blais, CRTC chairman.

In an interview with CBC radio Wednesday, in response to a question about the CRTC regulating OTT content, he said the commission is “a long way from making any decisions either way,” while backing away from assumptions that the CRTC is planning to regulate Netflix.

“I don’t know why people are assuming that we will do that. By all accounts, I have been quoted on a number of occasions that I don’t think that’s the right solution.”

“I think it would not be constructive to try to do that — bringing old world, linear world approaches to what is a very open media market,” he said.

But as more OTT services pop up, and as they increasingly encroach on the space occupied by traditional television, the commission may have no choice but to wade in.

Friday, the CRTC published a complaint by a company hoping to launch a new Canadian over-the-top service featuring both live TV and on-demand services.

Leiacomm owner Howard Rabb said in the application that the company has been trying to reach an affiliate agreement with Bell Media in order to distribute its networks, specialty channels and on-demand programming on Leiacomm’s OTT service, but that Bell has refused to license its content.

“We believe Bell is erecting obstacles to new competition in the distribution space,” the complaint said, arguing that Bell’s behaviour constitutes an undue preference.

If OTT players and traditional TV providers keep butting heads, the CRTC may soon have no choice but to jump in and act as referee.

 

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You could spy on me, but you wouldn’t want to

My privacy is being breached right now, you say?

Given what people generally mean by “privacy,” I’m not overly concerned. I’m pretty sure no one’s watching me in the shower, nor do I think there are cameras or microphones hidden around my home in order for Big Brother to keep an eye on my activities or hear any anti-establishment talk I might make among friends and family.

What people mean by privacy is that an Internet company like Google is keeping track of the kind of websites I visit or search terms I type into the engine in order to supply me with advertisements its machinery has deemed most relevant.

I don’t blame some people from being creeped out by this. The Office of the Privacy Commissioner has told (for subscribers only) Google not to collect users’ personal information, such as details about their health. This is probably the right move, given how much people are bothered by this kind of tracking.

But I’ll be honest; if my habits are being tracked, I’m not losing any sleep over it. I doubt my life is interesting enough for any real person to be assigned to keep track of it. Google’s surveillance of me does not, I’m fairly sure, go beyond a remote computer collecting data it associates with my IP address, with some sort of automatic function kicking in for the purpose of sending targeted ad content to me.

Documents that recently came to light from U.S. whistleblower Edward Snowden indicated that Communications Security Establishment Canada (CSEC) caught the signals of travellers’ devices that connected with a Canadian airport WiFi system during a two-week period, which then allowed authorities to keep track of these devices for days as they showed up at other WiFi hotspots. CBC reported that this occurred some time in 2012. Even though Snowden’s documents made no indication that individuals were identified through this exercise, experts say it would not have been hard to figure out who people were based on details that were picked up, such as their movements and social interactions.

Scandalous, isn’t it? But again, it doesn’t really get my goat. If CSEC picked up any signals transmitted to or from a device of mine during this time, any agent assigned to look at my habits would have quickly moved on out of boredom.

Bell recently had to defend its new process of keeping track of people’s personal details and electronic habits in order to send them targeted advertising.

Yes, I get the argument that organizations like the Public Interest Advocacy Centre are trying to make. I realize there should be a distinct barrier between people’s private lives and the governments and corporations they deal with.

Still, I was a kid while the Cold War was ongoing. I grew up amid tales of conspiracy regarding the assassination of John F. Kennedy, the Vietnam War and Canada’s state-of-the-art military aircraft, the Avro Arrow, for which development ended controversially in the late 1950s.

I remember thinking, after the terror attacks of Sept. 11, 2001, that the United States, and allies including Canada, were going to pull out all the stops to ensure something like that never happened again freedom and privacy be damned and an emotionally scarred public would support it.

The point is I never trusted government and always assumed they were spying on people in ways that weren’t made public. If big business is doing the same for its own purposes, it’s not such a stretch of my imagination.

Yet, I am comforted by the belief that it’s unlikely any government agent or corporate marketing genius has spent much time trying to figure me out through my electronic footprint.  My lack of illegal activity, covert associations and, for the business spies, financial capacity don’t make it worth their while, given the millions of others they would have more to gain from.

Given my indifference about some of this high-level stuff, it might not shock you that I’m not upset about the prospect of various restaurants and shops trying to figure out the travelling patterns of my smartphone, as new technology, such Rogers Communications Inc.’s Mobile Shopper, seems to do. Who knows? I might get informed about a sale on lattes in a neighbourhood I’m walking through right when I need one.

Essentially, I’m a little jaded about this whole privacy thing, given the environmental realities that have shaped me. There are things I hold dear, such as the freedom to associate with who I want, the freedom to express myself how I choose and the ability to provide for my family.

If the government finds it interesting that I spent 10 minutes on the phone with my mother the other night, I find that more confusing than infuriating.

Derek Abma is editor of The Wire Report. He can be reached at dabma@thewirereport.ca.

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