Bell and the CRTC square off in Mobile TV trial

Daniel Bader

January 20, 2016 9:12am

A federal court has agreed to hear an appeal by Bell regarding a decision the CRTC, Canada’s telecom regulator, issued last year.

At stake is the definition of what constitutes a common carrier for television broadcasts, and whether, by preventing Bell from exempting its Mobile TV app from mobile subscribers’ data buckets, the CRTC has limited innovation among Canada’s vertically-integrated telecom companies.

Just under a year ago, the CRTC found that Bell showed its mobile TV service ‘undue preference’ by exempting bandwidth used by the service towards a customer’s monthly bill. Under the Telecommunications Act, such a move would count as “zero rating,” which undermines the idea of all network traffic being treated equally by a common carrier — in this case, Bell Mobility.

But Bell took the CRTC to court, arguing that its Mobile TV service should be regulated under the Broadcast Act, which has no such net neutrality stipulations. This week, that court agreed to hear the argument, though it is not expected to rule until closer to mid-year.

In those introductory hearings, Bell’s lawyers reiterated what the company has been saying for months: that mobile TV, as it sees it, is a mere resubmission of what constitutes regular television content — that is, strictly speaking, the same content one would access through a regular cable, satellite or IPTV subscription. That one has to download an app, from either the Google Play Store or Apple’s iTunes, has no bearing on whether it functions as a conduit for broadcasting, according to the company.

Even with that logic, the CRTC and its supporters say Bell used its position as a common wireless carrier to preference not only its own customers, but by virtue of the company’s media properties, its own content, when broadcasting mobile TV, violating the Telecommunications Act.

During the hearing yesterday, the Attorney General of Canada made the distinction between Bell’s actions as a carrier and as a broadcaster, saying that the regulator was right to penalize the telco, since the issue was not with the content, which is determined by the Broadcasting Act, but the fact that Bell knew it was treating the traffic itself — that is, the ones and zeroes — differently for its customers than those of its competitors.

Regulators in both Canada and the U.S. have kept a keen eye on what vertically-integrated telecom companies have been doing recently. Last month, the T-Mobile, the third-largest carrier in the States, defended its BingeOn service, which exempts certain video feeds from counting towards customer monthly data allotments, saying that it was an optional service and did not unduly preference any particular video provider.

“Binge On is a VERY ‘pro’ net neutrality capability,” said John Legere, T-Mobile’s CEO, in a blog post. “You can turn it on and off in your MyTMobile (sic) account – whenever you want. Turn it on and off at will. Customers are in control. Not T-Mobile. Not content providers. Customers. At all times.” And though the FCC has repeatedly said that it will protect the rights of internet users through the Title II classification of the Communications Act, it has heretofore not found anything impermissible about T-Mobile’s zero-rating strategy, since the company does not own the audio or video content that passes through its network facilities.

In Canada, Quebec’s Videotron has undertaken a similar service for audio, Unlimited Music. Under the program, data generated by streaming music services Spotify, Google Play Music, 8tracks and Deezer doesn’t count towards a customer’s monthly data pool, but critics have said that by entering into deals with only the largest, often U.S.-centric, companies, Videotron disadvantages nascent startups that have less brand recognition.

For Bell, the narrow scope of the CRTC’s ruling, which is meant to keep in check vertically integrated corporations, is a blow to Canadian innovation. The telco has said that after the decision was passed that it was forced to raise prices on its Mobile TV add-on, from $5 to $8 per month, since it is now less attractive to the average wireless customer. The company has said that services like Mobile TV (in its ideal form) will go a long way to competing with international behemoths like Netflix, which this week announced that it now has 75 million customers.

  • alexb88

    I’m with Videotron and love the unlimited streaming music. I’m at 8 GB of usage between my music apps that hasn’t counted towards my data. They also give you access to Stingray Music for free, which is Canadian and has lots of Canadian content.

    • Elton Bello

      U lucky u live in quebec, that “communist” province lol

  • I hope Bell wins. I liked having the Mobile TV not count against my data

    • Brad Fortin

      In other words: “I hope Bell wins. I don’t care about Net Neutrality, I want free stuff!”

    • Net neutrality is something internet companies made up to protect their virtual assets. I highly doubt Bell giving some of its 7 million customers 5 hours of mobile tv a month will break the bank for multi billion (in USD) companies like Netflix.

      Beside, if I am paying an arm and a leg for my phone plan… Yeah, I was free stuff

    • Brad Fortin

      I don’t think you understand what Net Neutrality even is. It’s not “something internet companies made up”, it’s a principle of equality, and the name says it all: Neutrality. As in, treat all the traffic equally so that nobody has an unfair advantage.

      If Bell doesn’t count Mobile TV against your data cap but every other streaming service does, that gives Bell an unfair advantage against services like Netflix, Shomi, YouTube, etc.

    • It might not go against your data but it is still limited. It’s $5 for 5 or 10 hours a month.

      This argument complete BS. Shomi is like CraveTV, which is like Netflix, which uses your data. MobileTV is like the tv channels that we used to naturally get for free with analog programming.

    • Brad Fortin

      “MobileTV is like the tv channels that we used to naturally get for free with analog programming.”

      Except MobileTV still gets delivered over the exact same data network as Netflix and Shomi, so it should be treated like all other data on that network. They need to play by the rules of the network they’re on, not the network they’re trying to emulate.

      If Bell set up a separate HSPA/LTE channel/frequency specifically for MobileTV and offered unlimited free access to anyone with a compatible device regardless of their current provider then it wouldn’t go against net neutrality rules, as it would be broadcast TV service instead of internet service.

    • If you aren’t a PR, you should consider it, because you can put a spin on anything.

      Your argument would make more sense to me if it was a free app that anyone could get but the fact that you need a bell subscription proves that you are paying for a service. I don’t have a Wind phone with unlimited access to MobileTV. I have a Bell plus plan with 10 hours of mobile tv per month. This would only be unfair to netflix if it was offered to everyone for nothing or you could binge with no penalty. When you go over 10 hours you are warned and then charged $5 more for additional hours

      How is this unfair when it isn’t even the same type of service?

    • Brad Fortin

      There’s no spin involved. You just seem to have a hard time grasping the concept of equal treatment.

      Let’s imagine a scenario where you use both MobileTV and another service, that they use the same amount of bandwidth (~1 GB/hour), that you have 2 GB of data for the month (enough for 2 hours), and that the overage rate is $20/GB. In this scenario:

      – Watching 10 hours of MobileTV will result in no data usage and no additional charges.

      – Watching 10 hours of any other service will result in 10 GB of data usage, 8 GB of which is overages, which results in $160 in additional charges.

      This gives MobileTV a $160/mo advantage over all competitors, whether they’re streaming services like Netflix or on-demand services like the Play Store and iTunes.

      MobileTV has overlapping content with competitors, so given the choice between a service that leaves your 2 GB untouched and has no additional charges and one that uses all your data and results in an additional $160 in data charges, customers would overwhelming choose MobileTV and all competitors would be priced out of the market. After all, why would you use Netflix if it counts against your data when MobileTV has a lot of the same content but doesn’t count against your data?

      For Bell to meet the requirements of net neutrality they would either have to let MobileTV use data like every competing service on the market or give an additional allotment of data when subscribing to MobileTV (which could be used by any service, not just MobileTV). That way, even if it’s the same movie/show, there’s no discrimination based on which service you’re using.

    • arahman21

      Basically you want anticompetitive actions?

    • You seem to have the same thought of competition as th carriers do on pricing. I hope you don’t complain about how “competitive” it is to pay $125 for a plan that was $60 3 years ago

  • Andrew Goldenberg

    Honestly this is a legal issue because Bell owns some of the media they are showing preference to. If it was like T-Mobile where they were just doing it to make their customers happy and don’t have any ownership of the media being shown preference then this wouldn’t even be an issue. The problem is with content ownership and not really net neutrality.

  • hardy83

    If Bell wins, wouldn’t their argument about digitally streaming TV/Films being applied to the Broadcasting act rather than the Telecom act open the door for services such as Shomi and Netflix being put under that definition?
    Like set a precedent or whatever?

    That it would force companies like Netflix to follow the Broadcasting act as well as exempt their services from counting towards data caps?
    Or even ITunes/Google Play content being exempt as well?

    I’m no lawyer, that’s why I’m asking.

  • Sean

    The court could go the other way and force Bell to make all video services not count against the Bell data cap. I wonder how much Bell would like that. Hahaha.

    • abc123

      The “fastest network” would become the “slowest network” within a day.

  • Crossed

    Bell needs to lose because this will force them to increase their data buckets if they want to use this mobile tv feature.

    • abc123

      Nah, they’ll just charge overage fees. Based on what they’ve done recently, they’ll probably lower data buckets if they lose. Counter-intuitive, yes, but they’ll end up making more money.

    • Crossed

      Maybe you’re right. But then who in the right mind would buy a mobile tv package? People are very unwilling to dip their toes in overage territory, even if its minuscule.

    • abc123

      There are lots of tricks up their sleeve. They have to maintain their fastest network status, so they don’t want too many people streaming video like there’s no tomorrow. So they lower data buckets – not by a lot, but enough so that people will think about what they need to watch vs. what they can skip.

      It’s all about getting the right ratio of people on mobile video while maintaining a network and making money. If nobody signs up for mobile video, the first thing they will do is for new customers, give them 1 month for free or something like that. Then, there will be a certain percentage of people that forget to cancel. There will be a certain percentage that go over their alotted data buckets. There will be a certain percentage that will pay anything to watch live sports. There will be a certain percentage of people who like to have the latest and greatest hardware, software, and features.

      Companies actually hire people to do these types of analysis and set their pricing accordingly based on market trends. Currently, it seems the market is willing to pay whatever because there is not much choice in competition… and they can still afford to pay.

      The trick to robellus is to get the customer to pay as much as humanly possible without having a mass exodus to value carriers like Wind.

  • skoupo

    So wait. .

    They were forced to increase the price because it was as POPULAR?

    Lol that really makes sense.. let’s increase the price ..

  • Scott

    I’m confused as to why Bell is offering BOTH “Mobile TV” and “Crave TV”, independent and priced separately.

    Also, who the hell bought and subscribed to “Mobile TV” at $6 a month? In what scenario did you need to live stream TV (only Bell offerings) that you couldn’t do from a broadcaster app or website over wifi rather than using your data? I never understood this app at all. And the fact that Bell said they had x number of installations and installations equal users … BS! When you force it on your subscriber base as mobile phone bloatware you can’t count those numbers, that’s fishy!

    • Sequoia46.2

      I think anyone who signed a two or three year contract got the Mobile TV service for free. They count these free users.

    • Scott

      That could be the case but IMO those are still false number counts. App installed – check, “subscriber” – check, actually using the app on a regular basis – ??

  • Robby

    I say let Bell do this, as long it sets a precedent to allow Videotron to keep giving us unlimited music streaming. Driving 1-2 hours a day to and from work makes having unlimited music streaming a godsend. Maybe someone who uses the bus loves Bell’s unlimited TV, and that’s great for them. Let the carriers offer what they can and fight it out while the consumers get more choice. No one service is perfect for everyone, so I don’t believe that what any of these guys is offering is unfair to the other.

    • Abel

      I believe Bell’s Mobile TV only includes something like 5 hours. That’d be far from unlimited.

    • arahman21

      Nothing says more choice like the telcos giving out low data plans and exempting their own services to block out competition.

    • Robby

      Except that Videotron isn’t favoring their own service – I’m using mostly Google music and a little Spotify, and both services do not affect my data, yet neither is owned by Videotron.

  • Andrew English

    Bell could win this but if they do it will only force the CRTC tighten the rules to include services that will fall under net neutrality. Forcing companies like Bell to comply. It is always found loop holes, it’s unfortunately the CRTC is too old really plan for these things to happen and make sure they don’t happen in the first place.

  • Abel

    “The telco has said that after the decision was passed that it was forced to raise prices on its Mobile TV add-on, from $5 to $8 per month, since it is now less attractive to the average wireless customer.”

    Wait, what? So I pay $5 for 5 h of Mobile TV that doesn’t count to my data bucket, and then when it does count, I have to pay $8? Shouldn’t it be the other way around? I mean, if you’re now making it count towards my data allotment (which I’m already paying!), shouldn’t you give it to me for free? Why would I pay more now that the service is less attractive (ridiculous, I’d call it)?

    I swear, maybe I’m blind, but sometimes I think people that make (pricing) decisions (or public statements, for that matter) at these big corporations think that us consumers are stupid.

  • Rimtu Kahn

    Maybe I’m slow today but what is this about? “The telco has said that after the decision was passed that it was forced to raise prices on its Mobile TV add-on, from $5 to $8 per month, since it is now less attractive to the average wireless customer.”

    If it is less attractive and going to cost customer additional $s in data usage, the price should be lowered to make it more attractive and affordable, not increased. At least that’s what seems logical to me!

    Like I said maybe I’m slow today.