M. Imtiaz Karamat is an IP Osgoode Alumnus and Associate Lawyer at Deeth Williams Wall LLP. This article was originally posted on  on September 21, 2022.

On September 7, 2022, Canada’s Minister of Innovation, Science and Industry (the Minister), issued a  on Canada’s Telecommunications Reliability Agenda following the nation-wide Rogers network outage that took place on July 8, 2022. As part of the statement, the Minister provided details on a formal agreement between Canada’s major telecommunications service providers to lend support in the event of another major network outage.

The Rogers network outage had a massive impact across Canada, affecting the wireline and wireless services of millions of Canadians, emergency service providers and small businesses for over 15 hours. This event prompted the Minister to act, giving Rogers and other major telecommunications companies 60 days to enter into an agreement that would guarantee emergency roaming, mutual assistance, and a communications protocol for advising the public and government in the event of future major outages and other emergencies.

In response, the companies agreed to a  that is effective as of September 9, 2022 (the Agreement). Under the Agreement, the companies commit to assisting in the event of a major network outage that affects one of the other signatories. This includes providing support for Canadians to remain connected to their contacts, access 911 services, and conduct business transactions. The companies have also committed to providing timely communications during outages to keep the public and government authorities informed about response and restoration efforts.

The Minister announced that the Agreement marks the first of several steps in Canada’s Telecommunications Reliability Agenda, which will include:

1. the Canadian Radio-television and Telecommunications Commission (CRTC) investigating the Rogers outage and any new measures the company has implemented following the event;
2. the Canadian Security Telecommunications Advisory Committee (CSTAC) creating further measures within the next six months to bolster the reliability of Canada’s telecommunications networks; and
3. a review of all regulatory measures to be implemented that is aimed at strengthening the reliability and safety of Canada’s networks.

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Meena Alnajar is an IPilogue Writer, IP Innovation Clinic Fellow, and a 2L JD Candidate at Osgoode Hall Law School.

In March 2021, Rogers Communication Inc. announced an upcoming to buy Shaw Communications Inc for a US$26 billion takeover. If successful, Rogers will become Canada’s -largest cellular and cable company operator. Canada would resultingly have wireless providers to choose from instead of four. This deal is now facing opposition from some of Canada’s key regulatory powers. On March 3 2022, Canada’s of Innovation, Science and Economic Development Francois-Phillippe Champagne stated that “The wholesale transfer of Shaw’s wireless licenses to Rogers is fundamentally incompatible with our government’s policies for spectrum and mobile service competition, and I will simply not permit it.” But why should Canada prevent industries from extremely profitable mergers and acquisitions?

Ottawa’s main concern with this deal is the monopolization of essential services like cell phones and Internet. With a monopoly, Rogers is free to raise prices because no other competitor could offer a better price matching Rogers’ breadth of services. Many are concerned that they will not be able to compete with Rogers, and consumers worry they will suffer higher cell phone prices without other options. Rogers gave an assurance that it would not raise prices until at least years after the deal’s closing. But that assurance may not be enough to stop Rogers from continuing to competitors in the future, leaving fewer choices for Canadian consumers. Financial analysts acknowledge that while the government may try to reject the deal, the government’s statements are not necessarily fatal. predict that the deal will close, but, to maintain competition in the industry, Rogers will not be able to buy all of Shaw’s wireless business.

The Rogers-Shaw deal is likely moving ahead. On March 24, the Canadian Radio-television and Telecommunications Commission (“CRTC”) Rogers’ acquisition. The CRTC stated that, subject to modifications, Rogers’ proposal would not unduly affect Canada’s competitive landscape. The CRTC made stipulations to its approval that could once again balance Rogers’ acquisition and fair competition in the wireless service marketplace. Rogers will contribute towards various initiatives promoting local news and independent projects. Rogers must also create an news team with journalists in all provinces to provide news content to First Nations, Métis, and Inuit communities. These stipulations could help stimulate local journalism and production companies, addressing concerns regarding the survival of local wireless services after this big merger.

While Canadian government officials seek to discourage anti-competitive behaviours, Canada’s Competition Act was last reviewed in . Since then, Internet giants like Google, Facebook, and Amazon have often participated in anti-competitive practices online to dominate the marketplace. In Canada, Google and Facebook pocket of online advertising revenues, yet no laws have come in to stop them. Minister Francois-Phillippe Champagne announced on , to modernize competition law through legislative reform of the Competition Act. Through a broad review, the Competition Bureau has suggested changing the in the current competition law. This defence saves mergers that harm competition so long as the deal creates cost savings or other efficiency gains. Rogers may rely on this defence to keep the deal moving forward. Though not yet rejected, the Rogers-Shaw deal may be a catalyst for Minister Francois-Phillippe Champagne to implement changes to competitive practices.

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In response to this statement BCE, Rogers, and Telus (the "Big Three" Canadian telecommunication companies) launched a . They argued that the rules intended to support new entrants into the Canadian wireless market would actually allow large foreign corporations like Verizon to squeeze out Canadian companies and jobs.

Verizon CEO, Lowel McAdam, now says that Verizon the Canadian market. In an interview with Bloomberg news service, he said that the speculation of a Verizon entry into the Canadian market was “way overblown." Nevertheless, Verizon managed to spark a polemic discussion about the new spectrum auction and rules introduced by the government to encourage the introduction of a fourth major telecom competitor into Canada.

In 2012, the government to allow foreign companies to enter the market with some limitations. Companies with are now open to foreign investment, while large carriers are still restricted to one-third foreign ownership. In 2014, the Government plans to  four blocks of the 700-megahertz wireless spectrum to carry voice and data services. As a part of the government’s ongoing attempts to develop competition in the wireless market, the "Big Three" carriers will be restricted to bidding on only one block. The Government further " from purchasing either Wind or Mobilicity - the current small providers in Canada.

The "Big Three" argue that the rules will favour foreign carriers who enter the market because they would be able to bid on more than one block since they are not incumbents. Two of the four blocks are for new entrants and current speculation is that these blocks will therefore sell for a lower price since the big three cannot bid, making them attractive to a foreign competitor. Verizon is currently four times larger than the "Big Three" combined, which does not seem to be the underdog the government had in mind when it implemented the policy to encourage competition.

The withdrawal of Verizon has not put an end to the protest from the "Big Three". Rogers CEO, Roger Nadir, claims that while welcomes competition, the current policy in place do not provide a level playing field. laid out three loopholes in the rules that still need to be closed. A spokesman for said, “It’s never been about Verizon coming to Canada. It has been and continues to be about fair access to the spectrum.” The "Big Three" maintain that the rules provide an unfair bidding advantage to new entrants at their expense.

In late August, members of the country’s largest private sector union outside of Industry Canada offices, citing their disapproval of the new rules that will open telecom to foreign investment. They fear that the introduction of another provider will result in Canadian job losses as a result of corporate streamlining to remain competitive. The union is also concerned with privacy and security if an American corporation enters the market, especially in light of Verizon’s involvement in recent .

In my opinion, the concern from the "Big Three" may be unwarranted at this point. After all, despite government attempts to diversify the market over the last few years,��remain with the "Big Three". The introduction of Wind and Mobilicity has already resulted in an nearly in the last few years; however, Canadian carriers still have per user. Moreover, Canada has among the most expensive wireless plans according to the and the . Canada is a relatively small and rural market, which presents a huge undertaking of development of infrastructure to enter competitively in all areas. Thus, even under the new relaxed rules, one does not simply walk into the Canadian market.

According to digital public affairs analyst Mark Belvis, one poll indicates that would support entry of Verizon into Canada as they believe it would lead to better service and lower rates. Consumers already feel they have little choice and the attempt by the "Big Three" to gain sympathy did not gain much traction with frustrated consumers who used this campaign to air their grievances against their providers. Continued opposition from the "Big Three" to changes in the Canadian wireless market may prove to be a consumer-alienating strategy in the long run.

Even without the entry of Verizon, feels that “the way we’ve designed our policies, we are going to have more competition in the marketplace from other players.”  The government does not seem to have changed its position and still wants a fourth major competitor despite the media frenzy caused by the Verizon inquiry.  The auction remains for January and companies wishing to bid still must submit their applications by September 17^th.

Allison McLean is an IPilogue Editor and a JD candidate at Osgoode Hall Law School. 

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The Evolution of the Proceedings

The appellants, (Rogers et al), provide online music services that allow on-demand downloads and streams of files holding musical works.  In  1995, SOCAN proposed tariffs for the use of musical works over the Internet via downloads and streams, between the years of 1996 and 2006.  Subsequently, the Copyright Board established a tariff for the communication of musical works over the Internet, holding that the streaming of copyrighted music falls within the copyright owners’ right to “communicate to the public by telecommunication” afforded by section 3(1)(f) of the (“A����”).

On to the Federal Court, the appellant’s application for judicial review of the Board’s decision was dismissed.   The issue was whether the on-demand communication of a musical work to an individual by online music services, was within the meaning of section 3(1)(f) of the ������.�� The Court’s ruling was in agreement with the Copyright Board’s contention that “.” Thus, royalties applied for such transmissions and the tariff, proposed by SOCAN, was upheld.

The question raised on appeal to the Supreme Court of Canada was in reference to the proper interpretation of section 3(1)(f) of the Act.  More specifically, the Court was to determine whether the streaming of files provided by online music services at the request of individual users (i.e. on-demand)   constituted communications “to the public” of the musical works contained therein.  In light of the majority decision in , the issue regarding whether online music services engage the exclusive right to communicate by telecommunication by enabling downloads to the public became moot.   That is, musical works are not communicated when they are downloaded because they are merely reproductions of the works.

In regards to an online stream, Justice Rothstein that point-to-point communications via the Internet (i.e. on-demand communications sent directly to a single user at their request) are to the public, thus disposing of the appellant’s argument that point-to-point transmissions are necessarily private transactions between the user and the music service, beyond the scope of the exclusive right to communicate to the public (at para 55). The Court cited to further its interpretation, stating that “[I]f the content is intentionally made available to anyone who wants to access it, it is treated as communicated to the public even if users access the work at different times and places”.  Therefore, even if a work is streamed in a point-to-point manner, the fact that the same point-to-point stream is offered to anyone makes it “to the public.”

Rogers v SOCAN and the Digital and International Sphere

The ramifications of the “” rulings have yet to manifest; however, the holding in Rogers v SOCAN reaffirms an already existing practice, that is, the collection of royalties for streamed on-demand musical works. Although SOCAN can no longer collect royalties for downloaded musical works, the decision in Rogers v SOCAN reflects changes occurring in music consumption. In the rapidly evolving digital sphere, streaming music through on-demand services such as Spotify or Rdio is an increasingly popular way to listen to music and fees collected from streaming services can provide a great source of revenue for artists.  Justice Abella believes the Act should, and does, afford for by continuing “to apply in different media, including more technologically advanced ones” since it “exists to protect the rights of authors and others as technology evolves” (at para 39). On-demand streaming is an example of the evolution of communications and, as Justice Abella shows, the copyright act is flexible enough to adapt to this model.

In addition to acknowledging the evolution of music consumption, the decision in Rogers v SOCAN aligns Canada with developments at the international level.  Article 11bis of the , of which Canada is a party, stipulates various communication rights in literary and artistic works, which : works broadcasted or communicated to the public by any other means of wireless diffusion of signs, sounds or images. Other Berne Convention countries, such as Denmark, have that extend protection to “communication to the public of works, by wire or wireless means, including broadcasting by radio or television and the making available to the public of works in such a way that members of the public may access them from a place and at a time individually chosen by them”.  The Court’s interpretation of s. 3(1)(f) of the Act, which recognizes on-demand communication to the public as subject to copyright, parallels international thinking on the matter.

Although the other rulings released last Thursday represent a massive for artists, Eric Baptiste, CEO of SOCAN, that the Supreme Court “reconfirmed the online rights of music creators and publishers” and trusts that “the right final decision has been made in the case of Internet streaming". While less ambiguity is left in regards to the allowance of royalties for streamed works, it remains to be seen whether providers will be required to alter business practices in light of the rulings. However, artists can breathe a partial sigh of relief that their ability to be remunerated for works streamed through on-demand music services remains alive and well.

Tracy Ayodele is a JD Candidate at Osgoode Hall Law School.

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