Monday, June 01, 2009

THE PROTECTION RACKET

One of the most lucrative criminal enterprises is known as “The Protection Racket”. It’s an extortion scheme where someone powerful coerces others less powerful to purchase “protection” against various potential threats.

It might be to make sure nobody turns over your fruit cart or to keep competitors from opening up across the street.

It can operate so the “wrong” people don’t move into your neighborhood or bother your kids on the way to school.

Protection rackets are all about letting you enjoy some aspect of life -- as long as you pay for it – usually in the awareness the real threat resides in the guy selling you your peace of mind.

You could compare these rackets to some of the protections governments offer their citizens. Although in democratic countries those are usually agreed upon by the majority in their mutual interest.

But not always.

Sometimes what’s being protected is the fiction. And the perceived threat is what’s really earning the racketeers their money.

gangsters33

The Canadian Broadcasting Act clearly lays out the rules as they are to be regulated by the CRTC to protect our Canadian way of life:

(i) serve to safeguard, enrich and strengthen the cultural, political, social and economic fabric of Canada,

(ii) encourage the development of Canadian expression by providing a wide range of programming that reflects Canadian attitudes, opinions, ideas, values and artistic creativity, by displaying Canadian talent in entertainment programming and by offering information and analysis concerning Canada and other countries from a Canadian point of view,

(iii) through its programming and the employment opportunities arising out of its operations, serve the needs and interests, and reflect the circumstances and aspirations, of Canadian men, women and children, including equal rights, the linguistic duality and multicultural and multiracial nature of Canadian society and the special place of aboriginal peoples within that society, and

(iv) be readily adaptable to scientific and technological change;

Anybody see much of that happening lately?

So what’s really going on here?

Is the CRTC actively trying to enrich and strengthen our culture and economic fabric?

Or are they colluding with Canadian private broadcasters in the continued collection of ever increasing amounts of money from the Canadian public?

save_local_tv_localversion

In the last month, CTV and Global made it very clear that they make all their money rebroadcasting American programming. Presenting local news and providing Canadian content is apparently an incredibly expensive pain in the ass that also (Save Local Broadcasting campaigns aside) doesn’t have much of an audience.

Statements like the ones they’ve been making always lead to a whole cultural argument where us artist types ask the networks what they’ve done for us lately and they counter that they’d do their patriotic duty IF they could get more free money from the government or the cable companies or wherever.

In previous episodes of this endless game, the CRTC makes up some new rules that don’t make anybody very happy (least of all the viewers who have to pay for them) and a year later the broadcasters are back in Gatineau showing how the rules need to be bent a little more in their favor.

It doesn’t matter how many thousands of production jobs have been lost since 1999 to keep broadcasters afloat, or that their specialty channels no longer truly deliver the genres they were licensed to provide, or that they don’t always meet their content quotas; things always need to be further adjusted to keep them alone profitable.

And the Canadian public always has to dig deeper to come up with the “cabbage” the “pizzo”, the "krysha” to pay for that cultural protection.

But this little bicker-fest, dressed up in cultural robes as it is by both sides, isn’t about culture at all. It’s about money.

Because how could the Canadian networks make money rebroadcasting American programming if Canadians had access to American programming without them?

They couldn’t. And since those broadcasters don’t offer enough alternate fare to make anyone pay for their own services or advertise on them, they’d be done.

So the whole CRTC regulation thing has clearly devolved from it’s original intent to being little more than a protection racket – with the CRTC constantly using its regulatory muscle to protect the right of our broadcasters to earn a living without distinguishing themselves as Canadian in any meaningful way or “displaying Canadian talent in entertainment programming” or reflecting “the circumstances and aspirations, of Canadian men, women and children”.

They need to produce less Canadian drama. No problem.

They need simultaneous substitution. Go ahead.

Fewer newscasts. Genre ownership. Advertising breaks. Whatever the boys in the back room want, they get.

And in the end, the Broadcast Act, which was originally intended to protect the Canadian public from the undue influence of the United States of America, is subverted to allow even more American content to flood our airwaves.

If you don’t believe the CRTC and our private broadcast networks are colluding in this way, read a Globe and Mail item penned last week by Grant Robertson. It reports that the CRTC is considering giving broadcasters the right to pull feeds from cable and satellite providers and even black out American broadcasts of shows the Canadian network owns the rights to exhibit here.

Now, on a lot of levels, these powers would be suicidal for the broadcasters to actually implement. The loss of desperately needed ad revenue, damaged viewer loyalty and any number of other factors make the negative effects of flipping a blackout switch far outweigh any benefits they might accrue.

But Mr. Robertson is about as astute and intelligent an observer of the local broadcast scene as we have in Canada, so I’m thinking his sources are quite reliable and the CRTC really is searching for “a way to give the broadcasters more clout in negotiations with the cable carriers”.

Once again, after hearing all sides in the local TV argument, the Commission continues to be sympathetic only with the broadcasters and apply muscle on their behalf.

Cable companies and Artists can beg for more unique Canadian content and private citizens can ask for actual local news. But the CRTC instead threatens to provide their friends in the broadcaster cartel with a nuclear trigger.

Meanwhile, the one element that never seems to have a voice, the Audience, seems to be ignoring all of us and is quietly taking matters into their own hands.

Across the country, people are deciding in growing numbers to simply opt out of a system that stopped working for them while increasing its demands for more of their money and simultaneously reducing the viewing options they are offered.

dish4

When I look around my own neighborhood, I see more and more unbranded satellite dishes pointing in a number of different directions. Many are FTA receivers, picking up those signals that are (and always have been) transmitted into the atmosphere free of charge.

Unlike domestic cable and satellite, they are a one time charge costing less than half of the average annual bill from a Cable company, countering the loss of access to specialty channels with International OTA stations offering a wide range of niche viewing options.

But many of these dishes are mounted to pick up programming delivered via subscribed satellite services from a foreign country.

While Canadian networks continue to feed me a steady diet of American programming, my neighbors are watching Italian soccer, Argentine novellas, Asian comedies and Lebanese newscasts along with all the other programming those foreign networks provide their domestic audiences.

Now, technically, this is illegal.

When I first escaped Toronto for the relative sanity of its rural green-belt, a lot of my new neighbors had grey or black market Direct TV dishes that received a vast range of American programming. Cable simply wasn’t an available option (and still isn’t in many markets less than a half hour from the country’s largest city) and you needed at least a 60 foot antenna to pull in local OTA signals.

So they lived with the frequently advertised threat that the Mounties would turn up some day to confiscate their dishes and charge them. And the CRTC, broadcasters and cable companies all aggressively pressured the RCMP to do just that.

But with all these new satellite dishes openly on display on every single street in my new hometown, I never see any police dragging away my Asian, Latino or Eastern European neighbors.

Okay, they pick up the Saudi limo driver quite often, but I think that’s about something else.

Anyway – my point is -- how come an Italian soccer fan can watch Inter-Milan games from his former homeland but an American who wants to follow his Alma Mater’s basketball team on ESPN-2 is out of luck?

Why is it okay for my Asian grocer to watch movies from Hong Kong in Mandarin, but the mom next door can’t see the same films in English on HBO?

I mean, is it a language thing or a diversity issue?

Is the thinking that because so little Canadian programming is produced in languages other than French or English, that our immigrant population should be cut some slack in order to get their news and entertainment?

And how many people would choose to pass on “Etalk” for Iranian wrestling anyway?

Really? That many!!!

Or is the lack of prosecution because it’s only that forbidden English language American content (reflecting the American values the CRTC is supposed to keep from overly influencing us) that provides the bulk of the protection money rolling in for the racketeers?

antenna1

Recently, a lot of new technologies have begun to allow individual consumers the ability to circumvent the current television delivery system and get their programming from other sources.

I’m not talking about illegal downloading or streaming, P2P networks or software that gets around geo-blocking or DRM locks. I’m referring to the return of rabbit ears. Only in the form of one seriously rebooted bunny.

Last week, I bought one of the new HD antennas that have become all the rage in Southern Ontario. According to the retailer (one among dozens tucked in strip malls around the Greater Toronto Area) he can’t keep them in stock and sells about a thousand a month, mostly to people fed up with paying ever increasing cable fees for an ever decreasing array of programming.

That’s 1000 potentially lost cable customers a month multiplied by who knows how many dealers in just one market. In CTV terms, this one dealer could cost one local station 1000 subscribers x 12 months x 50 cents per month in carriage fees and the cable company a significant amount more.

Do the math over hundreds of dealers in hundreds of local markets across the country and you begin to realize that the current broadcast system could soon go broke despite the imposition of “carriage fees” and perhaps even quicker if enough consumers are angered by their arrival.

And if that scenario evolves, the Cable company cash cow that the broadcasters claim can easily fund their increasing financial needs will be a distant memory.

But people aren’t going to go back to using antennas are they?

Well, the device I bought took me about an hour to mount on an exterior wall and delivers a couple dozen HD signals; more late at night when the Ionosphere kicks in.

I can only compare the picture and sound quality to what I was getting from Bell Expressvu, but it’s better. Hugely better. Brought into my home by a device that resembles a BBQ grill in size and structure and for less than the cost of one current month of satellite service.

Installing it also made me wonder if the broadcaster resistance to meeting their HD delivery time lines in many parts of the country is because they know it will make these free signals available to even more people who won’t then have to access them through a cable delivery system.

hdtv_antenna_2085

If I decide to make this my primary television service, I, of course, won’t be able to get Discovery or Showcase or MTV. But according to their new CTV and CanWest owners, those channels will soon be little more than repeat platforms for their parent network offerings anyway.

I’ve already lost what used to be a cultural network to Dog the Bounty Hunter and Gene Simmons and a History Channel to “NCIS” and “JAG”. The bulk of my sports channel programming has become cheaply made Poker shows, Ultimate Fighting, (basically a depiction of prison sex) and endless talking head game analysis.

How much am I really gonna miss?

Our broadcasters need to realize that the only way to retain these customers is not by increasing and re-running their American content, but by creating alternative Canadian programming and more in depth local news and information.

Maybe it’s time the CRTC also realized that a growing number of Canadians either don’t want their protection or are failing to see their lives improved by it.

And turning those sentiments around won’t be accomplished by denials of service or revenue streams that don’t benefit the entire industry while building customer satisfaction.

It might be time for a truly meaningful sit-down where everybody gets a look at everybody else’s cards, instead of the secrecy and hidden alliances more appropriate in a back alley than the offices of a public regulator.

And if that doesn’t happen and you’re interested in freeing yourself from the Protection racket. You can find all you need to know here, here and here.

5 comments:

Brandon Laraby said...

It's crazy to see all this infighting and backbiting about subscribers when pretty much... okay, over half of the people I know have decided to watch their TV through almost any other option than being plunked down in their living room. Heck, I know two separate couples that don't even have a TV in their living room anymore. They get their news/weather/etc off their blackberries/iPhones, buy/rip season's worth of TV programming onto their iPods (to watch on the go - sans commercials).

I've got a PVR now - and while I still have cable service, I barely watch straight-up TV anymore. I just don't have the time/want to schedule my life around being in the living room when a show is actually on (at least now that BSG is over...).

The world's moving on - and fast. HULU just launched a program allowing you to turn your computer into a TV (with remote control support and all - basically an amped up version of Boxee).

The information's out there - and the middlemen are becoming increasingly obsolete... which is a shame, but hey, a middleman's #1 job is to figure out a way to stay stuck in the middle. And right now, it reeks of the kind of slovenly laziness that is bred by not having to really fight for your dinner.

Problem is, they're going to have to start. And fast. 'Cause the horse is out of the barn and that sucker's a-blazin' behind'm.

Wpascoe said...

I've seen those HD rabbit ears. I've heard about them. And now I know someone who has them. Thanks for the informative post, Jim. I may be asking who your retailer is...

Anonymous said...

The problem is much bigger than just Canadian broadcasters and the cable and satellite providers.

Unpaid signal regeneration and distribution is rampant in Canada.

Do you know it's possible to listen to out-of-market stations on your AM radio at night!

Those programs you might hear cost money to produce, and The Ionosphere has not paid the originators ANYTHING for the right to relay them to you.

This rogue Ionospheric transmission, known on the street as "skywave" or "skip" is effectively STEALING content.

As if that wasn't bad enough, The Ionosphere is HARMING local radio;

By taking local broadcaster's signals and relaying them into other markets without paying for the content, The Ionosphere has been relentlessly exploiting an arcane technological loophole known as "electromagnetic intermedia refraction" to STARVE your local broadcasters of needed funding.

And by flooding the local market with distant stations, The Ionosphere has been aggressively reducing the advertizing revenue your local stations depend on to create true local programming which serves YOU.

You may be SHOCKED to learn that The Ionosphere has unilaterally exempted itself from all Canadian content rules, and brings programs and opinions from other nations and cultures without complete DISREGARD of all regulation or official oversight!

It's time to give Canadian producers and local stations a fair shake. Call or write your Member of Parliament, and join your voice with the growing number of Canadians who DEMAND that the CRTC take action against the scofflaw insanity of Ionospheric Radio Propagation!

Together, we can make a difference. Together, we can stop "skip" in its tracks!

National Skip Abatement deserves a place on our public agends, now more than ever.

Nikola Tesla

Racicot said...

It's funny. I wrote a spec pilot very loosely based on my experiences at MCTV in Timmins titled, The Good News Network - where the local Mafia (run by the wealthy/maniacal car dealership owner) 'guarantees ad revenue' to hedge against the evil, bad news network from taking over the local airwaves - with ludicrous demands for shared creative control.

And contrary to what George (the most unfunny person on television who THINKS he's funny) Stromboloupolous believes, he didn't invent the concept of reporting good news.

I'm sure every family has had the same thoughts as me: what if there was a news program that ONLY reported good news?

Only my comedy pilot involves hookers, hash parties, and the solution to acid rain.

Always Great Posts Jim!

Thanks for being there.

Brandon Laraby said...

Nikola,

I'm still waiting for that free, worldwide electricity you promised. And my death ray. I saw the prototype and I know you've got it kickin' around somewhere.