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Canadian Webcaster of Broadcast TV Defends Service

William Craig, chief executive officer and founder of iCraveTV.com, told Newsbytes today (Dec. 9) that he's confident his company will be able to sort out the issues at the heart of a dispute with the broadcasters and film and television producers who have implied his Web site is pirating their content.

The issues all have to do with money, he said.

The company started its 24-hours-a-day-service Nov. 30, relaying signals from 17 channels that are currently available in iCraveTV.com's home base of Toronto, Ontario. The channels represent most of Canada's broadcast television networks - including the publicly funded Canadian Broadcasting Corporation - as well as such US-based services as NBC, CBS, ABC, Fox and PBS.

Through the Canadian Association of Broadcasters (CAB), Canada's public and private television networks went collectively ballistic. Although it's not clear whether or not iCraveTV.com is contravening any Canadian broadcasting or regulations, the CAB sent Craig a cease-and-desist order with a Dec. 6 deadline.

Today, Craig's Web company is still broadcasting and visitors to the site are asked to declare that they are Canadian citizens before watching any of the broadcasts using their RealPlayer for streaming video from RealNetworks Inc. [NASDAQ:RNWK]. Craig said the restriction on Canadian viewers is in place because it's the Canadian broadcasting and telecommunications regulators who have made his service legal.

In May of this year, the Canadian Radio-television and Telecommunications Commission (CRTC), announced that it would not regulate Internet communication. What's more, it said that, in cases where the Internet content would normally fall under the country's Broadcasting Act, such transmissions would be "exempt from regulation" online.

In making that ruling, the CRTC said it hoped to encourage the growth of new media services in Canada. But the broadcasters and Canadian Film and Television Production Association (CFTPA) say iCraveTV.com's form of new media may be old-fashioned copyright and trademark infringement.

Craig told Newsbytes that what iCraveTV.com does in relaying broadcast signals isn't a lot different than what cable companies do.

In Canada, the CRTC requires that cable-television companies carry the signals of many competing broadcasters - and all local broadcasters - to ensure that such closed systems don't separate viewers from what's available on the airwaves.

"I think (broadcasters) have been fairly irrational," Craig said. "They insist that the cable companies carry them, but with us they're insisting that we don't."

CFTPA spokeswoman Sylvie Powell said the film and television producers are concerned that ICraveTV.com pays no fees, as cable companies do, to support the production industries.

Craig said he agrees his company should pay some fees and is willing to negotiate.

He pointed out that cable companies pay a flat rate of just 75 cents per subscriber per month, with the revenue going into a general copyright fund for film and television production. But, since iCraveTV.com started broadcasting, Craig said, broadcasters have been suggesting fees out of proportion with the system already in place for collecting funds from carriers.

"For example," he said, "we have a letter from (Britain's) BBC asking for payment on programming that is carried on TV Ontario and CBC and PBS, and we've also got the CBC saying that they should be paid for the same program. It's a little bizarre."

Craig said that, since his company doesn't charge subscription fees, he thinks iCraveTV.com should contribute to the copyright fund on the basis of gross revenues which, in iCraveTV.com's case, are likely to come from banner advertising.

CAB spokeswoman Sandra Graham told Newsbytes that, in the wake of iCraveTV.com's decision to ignore the cease-and-desist order, lawyers hired the broadcasters' organization were now mulling over possible legal remedies. And she declined to predict just what it is about iCraveTV.com's service that a lawyer would identify as illegal.

"We're looking at all the different legal regimes that are in place and we are not in a position to get into the details yet," she said. "It's a new industry and a new situation so they're looking at all the different options available."

Raising some eyebrows is iCraveTV.com's practice of framing the video image seen in the RealPlayer window with its own logo and bottom-of-the-screen advertising.

"Banner advertising is all over the place on the Web," Craig said. "and that's how we pay for providing the service. Do they expect it to just come out of nowhere?"

In an earlier statement, the CAB said iCraveTV.com violates "a host of copyright and trademark issues" and complained that "the inferior quality of the signal provided by iCraveTV.com doesn't meet the high standard set by Canada's broadcasters and expected by Canada's viewers."

Craig argued that, in downtown Toronto office towers where broadcast-television signals are poor, iCraveTV.com can offer better viewing for office-bound TV addicts.

ICraveTV.com can be found on the Web at www.icravetv.com. The CAB is at www.cab-acr.ca.

Reported by Newsbytes.com, www.newsbytes.com.

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