Friday, April 15, 2011

Regulated Oligopoly

Businesses that operate in a protected and regulated oligopoly environment, become weak and uncompetive. For examples of this effect, look to the businesses in the Canadian broadcast and telecommunications industry: Bell, Rogers, Shaw, etc.

Two years ago, the CRTC held the new media consulations which asked if TV delivered over the Internet should be regulated. The response from the afore mentioned companies was unanimous: no. They even declared that the so called "over-the-top" services were not a threat. (I have no idea why they call it "over-the-top" service.)

Now that Netflix is operating in Canada, those very same businesses have changed their tune and are appealing for the CRTC to regulate TV delivered over the Internet. At the first sign of competition, those companies run to the regulatory body, like little children crying for mummy when the game isn't go their way. It is completely ridiculous that they didn't even try to compete. They have access to the same, if not better, technology as Netflix.

Here is Micheal Geist's point by point comparison of what the companies said two years ago versus what they are saying now. It is really quite sad.

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