A small Canadian company fighting to show U.S. television programs on the Internet remains in limbo this week, as lawmakers consider amendments to the country's copyright laws that could set important new digital broadcasting rules.
A copyright bill was presented to Parliament on Wednesday, capping two years of contentious debate over nascent services that capture broadcasts of hit shows such as NBC's "Frasier" and make them available online.
Canada allows retransmission of broadcasts for satellite and cable companies under compulsory license, which permits the use of copyrighted material under a royalty rate set by law. It has been unclear, however, whether Internet retransmissions are covered by the current rules.
"This bill will clarify that the compulsory license applies to cable and satellite companies, but will leave the door open for Internet companies, or anyone else for that matter, as a matter of regulation," said a spokesman for Canada's Department of Heritage, which handles copyright law in cooperation with the Department of Industry. He added that specific regulation will be worked out in the next few months.
Canada's proposed copyright amendments come as television broadcasters and copyright holders face increasing audience fragmentation spurred on by greater entertainment and programming choices, and a wave of new technologies that threaten to gut their traditional businesses.
While PCs cannot yet compete with television in viewing quality or breadth of available content, the Internet is viewed as a long-term threat to jealously guarded geographical broadcasting boundaries, which allow copyright holders and broadcasters to squeeze more money out of their products.
University of Ottawa law professor Michael Geist, an Internet law specialist, said the government may yet carve out a place for Internet broadcasts, provided certain geographical limits are enforced to ensure programs are seen only in Canada.
"Some are pushing for an Internet exception, but that's not going to happen," he said. "Others suggest that the government should not single out any one technology, but put a box around retransmission that makes it difficult but not impossible for Internet broadcasters."
Canada became a flashpoint for Internet broadcasting in late 1999 when a start-up called ICraveTV began offering online retransmissions of shows pulled off the airwaves, saying the practice was covered by Canada's compulsory license. Television broadcasters sued and quickly shut it down, however, arguing that the company had infringed their copyrights by making content available worldwide without permission.
The issue did not die, however: Canada's close proximity to the U.S. border, wide Internet availability and unique history of broadcast rights soon inspired a second company to test the Internet broadcast waters.
Montreal, Quebec-based JumpTV has been battling a coalition of broadcasters in Canada for much of the past year over similar issues, but has avoided a direct confrontation by seeking appropriate legal rulings before moving ahead with its plans. The company has said it is prepared to limit its broadcasts as much as possible to viewers in Canada, using so-called geo-tracking technology from partner Quova. It has also agreed to pay royalties just like satellite and cable providers, which pay 70 cents per subscriber a month for access to programming under rules stemming from the U.S.-Canada Free Trade Agreement.
JumpTV CEO Farrell Miller said he is now waiting to see how the proposed copyright amendments shake out in the details.
"Our view all along has been that different technologies shouldn't be treated differently when it comes to the compulsory license," he said. "We still have to wait to see what the regulations are to see the full ramifications of the bill."