A Canada without YouTube? It could happen. - Macleans.ca

A Canada without YouTube? It could happen.

If the CRTC decides CanCon rules apply online, web companies could be tempted to cut off Canada

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Photo by jonsson/Flickr

Here’s an interesting if somewhat disturbing thought: can you picture a world without YouTube? Or more specifically, a country without YouTube?

It seems improbable, almost impossible, but it’s entirely conceivable if the CRTC loses its collective mind and decides to regulate such “over-the-top” Internet services in Canada.

The regulator, answering to cajoling from traditional broadcasters, has now concluded its “fact-finding mission” on whether YouTube, Netflix and other OTT services should have Canadian content rules foisted on to them. At some point, it will decide on whether to proceed with a new, full hearing, or whether it will just drop the issue, at least for now.

The CanCon rules applied to traditional media generally require broadcasters to air a certain percentage of Canadian programming per day, plus pay a percentage of their revenues into funds that help create said programs.

Now imagine if those same rules were applied to the likes of Netflix and YouTube. They’d be easier for Netflix to adopt. It would probably be simple and cheap for the streaming video provider to stock up on old episodes of Beachcombers and The Friendly Giant, thereby meeting the percentage requirements. Paying into development funds would also drive up Netflix’s cost of doing business, which would mean the company would either have less money to spend on new content or it would have to raise prices, but it would be doable.

For YouTube, however, it’s a different story. Measuring and controlling the service for Canadian content would probably be next to impossible, but it’s actually the money issue that’s the bigger problem for YouTube’s owner, Google. The company has been promising for years that the video service is nearing profitability, but barring any official announcement, it hasn’t happened yet. That’s because it’s not an easy business to monetize. The tremendous popularity of the free service means rather big infrastructure costs, which advertisements haven’t seemed to counter just yet.

So what are a few extra million dollars in regulatory costs to a company the size of Google? Not much, but Canada would likely be just the first of many countries to dip their hands into Google’s pockets. Any other country that failed to enact similar regulatory requirements and costs—in the name of national cultural development, of course—would be missing out on an easy pay day. When that inevitable global bonanza gets added up, YouTube’s already questionable climb to profitability would slow down considerably.

Google is not likely to ever come out and say it would block Canadians’ access to YouTube in the event of regulation (I asked and they didn’t comment), but it would make sense if it happened and no could really blame the company. After all, sometimes it’s best to cut off a limb to spare the rest of the body from a hostile infection.

But boy would it be fun if the unlikely did happen. For one thing, given that Canadians are among the world’s biggest users of YouTube, we might not have to worry about usage-based billing anymore since our internet traffic would plunge off a cliff. The country would go back to the good old days that big Internet providers seem to love so much, where all people did on the internet was send email.

More realistically, though, usage of BitTorrent file-sharing and virtual private networks would skyrocket, making Canada a veritable piracy wonderland. Yo ho ho and a bottle of rum!