CMNS 230 1

Public Policy, Regulation & Instruments

Part Two: the Policy Process

CMNS 230 2

The Policy Process

• Environmental scanning• Problem Identification• Agenda Setting• Design & Policy Formulation• Analysis & Options• Decision• Implementation• Evaluation & Feed Back Loop

CMNS 230 3

Stages of Public Policy Process

CMNS 230 4

The Policy Analysis Method

• Scan the environment: problem definition• Problem Analysis

– What are the sources of the problem– Why is the problem important– What are the different stakeholders’ views of the problem

– Which options do they support and why• Cost Benefit Analysis ( multiple perspectives)• Political Opportunity and Cost Analysis

• Recommended option & Plan for Implementation• Briefing Document to the Deputy Minister and Minister includes a communication plan and metrics for policy evaluation

CMNS 230 5

Two Rival Causal Models of the Policy Process

• Rational Planning• Incremental ( Policy Learning)• Third: underlay of a competitive pluralist conception: game theory– may cross cut the two rival models

CMNS 230 6

The Policy Development Process

• Evidence based• Consult stakeholders• Examine and weigh evidence• Best described as the selection of a goal, means to achieve it, monitoring & assessing outcomes.

CMNS 230 7

Policy Instruments

• The form of administration or implementation used– Range on a continuum of coercion– Soft to Hard Power– EG: expropriation, ownership, taxation, regulation, subsidy,partnership, exhortation, persuasion

– Drawn from administrative law– Usually therefore subject to appeal and judicial review somehow: intra vires? Fair? Transparent?

CMNS 230 8

Examples of Policy Instruments

• Legislation– `EG: Income Tax Act– Disallows advertising expenses on US media as deductions– Conversely, can set up tax incentives ( allowable deductions)

• Regulation/ Agencies– Canadian Content Quota on exhibition: CRTC– The Canadian Copyright Collective

• Subsidy– Canadian Television Fund investment in drama

• Ownership– National Film Board, CBC

• Monitoring– Senate/Standing Committee on Heritage reviews

• Exhortation– Pushing Cultural Diversity Guidelines: CRTC ‘expects’ Canadian

Association of Broadcasters to develop them• Persuasion

– Policy summits: policy learning

CMNS 230 9

The Idea of Policy Paradigms

• Paradigm: world view, organized policy frame• Source: policy discourse/analysis of ideas• Implementation: Policy Networks• Where overall ideology of the regime intersects

with specialised policy area

– Eg: health: preventative versus curative care

• Paradigms are systems of interpretation of the enabling legislation– they articulate values and establish ‘brands’ or ‘metaphors’ to mobilize learning, and consent in policy networks

CMNS 230 10

The Key Paradigms at Department of Canadian

Heritage• Public Interest ( Broadcasting)• Pro Indigenous Market Model• Cultural Development• Social Cohesion• Cultural Diversity• Cultural Rights

CMNS 230 11

Paradigmatic Shifts

• Change over time• Depend on dominant ideas of the day

• Vary every 4 years with party in power

• Contest of policy stakeholders

CMNS 230 12

A Case: The Local Broadcast

Retransmission Right• Currently before the Federal Government

• Broadcasters own the signal they transmit under S. 24 of the Copyright Act of Canada, and they negotiate exclusive rights to carry programs acquired from others

• They receive payment for their signal if it is carried in a distant market but not a local one

CMNS 230 13

Definition• Retransmission consent involves the complicated

agreements / contracts brokered between television networks and local broadcasters and then local broadcasters and cable or satellite systems.

• How it works:– The local broadcasters demand the exclusive right to retransmit their produced or licenced content in their local communities in order to attract advertisers and maintain profitability. Then, in another set of negotiations, the broadcast affiliates cut deals with local cable companies allowing them to retransmit the broadcaster's signal to local communities, subject to tiering and other cable regulations set by the CRTC

• Thus, involves copyright and business contract law

CMNS 230 14

The Policy Problem

• Should broadcasters with local affiliates ( eg. CBC, Global, CTV) received payment for their signals?

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Background

• Legal– Until the Free Trade Agreement in 1988, cable distributors did NOT pay

for the signals they retransmitted over their lines– Under pressure from US border broadcasters, Canada introduced a

copyright amendment called the DISTANT SIGNAL RETRANSMISSION RIGHT• Which applies only to over the air transmission

– Cable now must pay to retransmit distant signals under a COMPULSORY LICENCE• Not a market set mechanism ( see Lincoln, 452).• The Copyright Collective of Canada collects the fees by formula and then

redistributes them to copyright holders• Most of the money goes to US rights holders• Partially remedies unfair position between cable and broadcast industries on

copyright

• Economic– The rise of hybrid-financed specialty channels ( which charge cable

distributors a fee for their service on a subscription model and also raise revenues through advertising) raises new questions of fairness: more of a market model, since high demand channels command higher fees

• Technological– Digital transition: ie the move to digital transmission requires new

capital infusion

CMNS 230 16

Issues and Implications

• Plays into the power battle balancing private property rights and the public commons

• May be the thin edge of the wedge entrenching digital rights management systems: designed to extract payment from consumers and extend privatization

• Has the ironic effect of saying digitization trumps use of the spectrum

• Yet, may jeopardize public benefits attached to spectrum use:- threaten local and threaten can con obligations to Canadian production

• May de facto establish a North American rights system in broadcasting: cause sales of stations to US, bankruptcies

CMNS 230 17

A Profile of the Stakeholder Interests and Positions

• Cable: opposes local right• Private Broadcasters: want local right set at market:

not compulsory• CBC: wants local right• Not for Profit Broadcasters (Vision, APTN etc):

oppose• Independent Private Specialty Channels( e.g..

Fairchild, Ethnic Channels Group) argue that a sub fee paid to over the air broadcasters, cable and satellite providers will be passed along to consumers, or else put pressure on reduction of current fees to independents

CMNS 230 18

Relevant Experience in Other Regimes

• WIPO does not, as yet, recognize a local retransmission right

• Under debate: the need for a 50 year IP right in broadcast signals on the basis that broadcasters “invest” in their signals

• 83 countries (but not the US and 99 other countries) have signed on to the Rome Convention that gives broadcasters a 20 year intellectual property-like right in their signals

• Icrave case the precedent

• In the US, the “retransmission consent” law gives broadcasters the right to demand compensation from cablecasters simply mandating a contractual relationship between broadcasters and cablecasters, integrally interconnected to the “must carry” law, which forces cable-casters to carry local broadcast signals but it is contractual, not copyright

• EU has local retransmission right

CMNS 230 19

Policy Options

• No Change to Copyright: Status Quo– Pro: protects public nature of signal;l ie blocks concept of

encryption, digital rights management from proprietor’s perspective

– Con: suppresses copyright revenues to rights-holders• Change to a Compulsory System

• Merely extends current regime to include local signals• A regulated sharing of the pie• Pro: incremental, and low cost solution• levels the playing field

• Con:– May strain the old TV network / local broadcast affiliate relationship beyond the breaking point. Who is going to

deliver local news, weather, traffic and sports if the financial viability of local television broadcasters is undermined and local affiliates start going under?

– Most copyright payments go to foreign rights-holders– There is an inbuilt bias to tonnage ( a commercial quantity driven test of

ratings)

• Change to a Market System– Pro: recognizes value of local broadcast– Con: may disadvantage smaller, independent players unless

regulated

CMNS 230 20

The Bypass Game

• Instead of waiting for copyright revisions which are stalled, private interests are pushing for a market right to charge subscription fees from the CRTC

• This now before the TV Policy Review ( Broadcast Notice CRTC 2006-5)

• Effectively pre empts a copyright solution

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BUT

• No anteriori evidence of financial harm• A forecast scenario of hypotheticals• Public commons impacts not clear: nor is impact on

independent producers

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Recommended Policy Option

• Incremental copyright reform• Monitor impact on independents• Ensure a proportion of revenues flows through to public

benefits: priority programming

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Memorandum to Cabinet ( 750-1,000 words)

• A statement of issue• Recommendation• Who consulted• Strategic Political Considerations

– Federal Provincial Relations– Environmental Impact

• Communications Plan23

CMNS 230 24

Sources:

– http://www.publicknowledge.org/pdf/wipo-statement-20060905.pdf

– http://www.cab-acr.ca/english/television/submissions/default.shtm

• September 1, 2006 - Submission• Public Notice 2006-72, Call for comments on a request by the

Governor in Council pursuant to section 15 of the Broadcasting Act to prepare a report examining the future environment facing the Canadian broadcasting system (pdf)

• Appendix 5: Emerging Trends in the TV Rights Landscape (pdf)• http://www.cbc.radio-canada.ca/submissions/crtc/pdf/BNPH-2006-5

_TV-Policy-Review_270906.pdf