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New CRTC leader will face several unusual issues

Ian Scott. former government relations executive at Telus Corp. and most recently a lobbyist at satellite communications provider Telesat Canada – was named to the five-year post as chairman of the CRTC in July.

Graham Hughes/THE CANADIAN PRESS

Canada's broadcast and telecom regulator is getting a new leader. Ian Scott begins the job of chairman of the Canadian Radio-television and Telecommunications Commission (CRTC) Tuesday and he already has a full slate of potentially politically charged issues to confront.

Mr. Scott – a former government relations executive at Telus Corp. and most recently a lobbyist at satellite communications provider Telesat Canada – was named to the five-year post in July. Shortly before that, the federal government had already lobbed one telecom file back to the commission to reconsider, and since he got the job, Ottawa has added a broadcast matter to his list. BCE Inc., the country's biggest communications company and owner of Bell Media, has also launched a renewed bid for the CRTC to change a contentious ruling on Super Bowl commercials.

Here are three out-of-the-ordinary files Mr. Scott will have to deal with on top of the usual regulatory workload of a busy commission:

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A new model for cheaper wireless service?

In early June, Innovation Minister Navdeep Bains instructed the CRTC to rethink a recent ruling that shut down a business model used by Toronto startup Sugar Mobile, which offered cheap wireless service by relying primarily on WiFi. When its customers were not on WiFi, Sugar turned to a roaming agreement its sister company Ice Wireless has with Rogers Communications Inc. (Ice operates a small network of its own in the territories.)

The CRTC said this was "permanent roaming" and offside rules meant to encourage companies to invest in buying airwaves and building their own cellular networks. Mr. Bains has given the CRTC until March 31, 2018, to review the ruling and told the regulator to consider a "WiFi-first MVNO" model. Mobile virtual network operators (known as MVNOs) are companies that pay for airtime on an established carrier's network and resell the service under their own brand. They aren't common in Canada, which many say is because the CRTC hasn't forced the three national carriers, Rogers, BCE and Telus, to do business with companies that would offer consumers new choices at the retail level.

In a parting speech before he left in June, outgoing chairman Jean-Pierre Blais said he was concerned about wireless competition and argued "the CRTC will need to act" unless things change. Mr. Bains says he wants the CRTC to reconsider allowing MVNOs that rely primarily on WiFi to also buy roaming services from established carriers at regulated rates. But he also said the commission should maintain its commitment to supporting a "strong investment environment," setting up Mr. Scott's CRTC to perform a tricky balancing act.

Bell's Super Bowl ads Hail Mary

Bell has already made multiple runs at a 2015 order that barred the company from substituting its own feed over the U.S. broadcast of the National Football League's championship game starting this year. But the company, which owns the broadcast rights to the Super Bowl in Canada, is hoping the CRTC might have a change of heart and let it run its own content – including the Canadian ads it sells – on U.S. stations during the 2018 game. Within weeks of Mr. Scott's appointment, Bell filed a new application with the CRTC asking the commission to overturn the order, pledging to run a program of the big-budget, exciting U.S. commercials in advance of the game.

The company also has an appeal before the courts on this matter and has tried lobbying the government in the past. Bell is selling ads for next year's Super Bowl at prices that assume it will indeed be able to substitute its own commercials over the U.S. feed (if it cannot, it will revise prices downward, like it did this year). Bell had a contentious relationship with Mr. Blais, giving this relatively small matter added symbolic weight.

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A test of support for original Canadian programming

Ottawa punted another file back to the regulator last month in a rare response to cabinet appeals on the licence terms of large Canadian broadcasters. Heritage Minister Mélanie Joly instructed the CRTC to reconsider the licences after a chorus of complaints from creative groups raised concerns that new terms set by the commission would decrease what some of the major broadcasters spend on original Canadian programming.

For English-language broadcasters, the CRTC set a uniform percentage of revenue the companies must contribute to "programs of national interest" (PNI), which includes scripted comedy and drama. That lowered the amount that Bell and Corus Entertainment Inc. must kick in to 5 per cent, in line with the percentage Rogers contributes. The CRTC said the changes would give broadcasters more flexibility as they face intense competition from online options such as Netflix. But critics of the ruling – who said it would mean $141-million fewer for PNI over five years – marshalled an impressive lobbying effort to win the Minister's support.

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About the Author
Telecom Reporter

Christine Dobby covers the Canadian telecom industry for The Globe and Mail. Before joining the Globe in May 2014 she reported for the Financial Post for three years, most recently writing about telecom and media. She has also reported for the Toronto Star and New Brunswick Telegraph-Journal. More

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