Canada's leading telecommunications and cable companies have formed the Canadian ISP Alliance as they gear up for the forthcoming fight at the CRTC over a potential new levy on ISP services. The ISP Alliance, which includes all the major Canadian players (Quebecor, Rogers, Cogeco, Telus, MTS Allstream, Shaw, Sasktel, Eastlink, Bell, and Bell Aliant) argues that the CRTC plans to revisit the 1999 new media exemption order is unnecessary. While the ISP Alliance is not alone in making that argument (the Canadian Chamber of Commerce; and ITAC reach the same conclusion), their submission is noteworthy because it includes a legal opinion that argues that the CRTC does not have the legal authority under the Broadcasting Act to impose a new levy on ISPs (the levy is being promoted by several groups including ACTRA).
The legal opinion from Fasken Martineau DuMoulin first tries to make an analogy to satellite services, which similarly transmit video and audio content, yet have not been regulated as broadcast undertakings. The opinion also notes the functional separation between telecommunications and broadcast regulation, arguing that it was the clear intent of Parliament to regulate broadcasters in the Broadcasting Act and telecom companies in the Telecommunications Act.
While the legal opinion makes no reference to net neutrality, the issue could ultimately play a pivotal role.
The core of the opinion is that ISPs are not "distribution undertakings" under the law since they play a passive role. It argues:
Unlike broadcast undertakings, ISPs play a passive role: they are engaged solely in carriage. ISPs do not select or originate programming, aggregate programming services, or otherwise influence the nature of the programming or content that is transmitted or accessed over the Internet.
That may well have been true in world where ISPs acted solely as intermediaries, yet the current Bell - CAIP proceeding demonstrates that Canadian ISPs are playing an increasingly active role in managing their networks and thereby influencing the nature of the programming or content that is accessed over the Internet. With several groups emphasizing the need for the CRTC to examine net neutrality in a new media context (Campaign for Democratic Media, Pelmorex, Songwriters Association of Canada), the ISP Alliance may find itself facing some tough questions about just how "passive" its members really are.
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