Thursday, April 15, 2010

Why NetFlix Isn't Coming To Canada

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Netflix, the popular DVD rental by mail service that has transformed itself into the Internet's most popular streaming movie service is now one of the forbidden fruits for Canadians.  Just like Google Voice and Hulu despite popularity south of the 49th parallel is not available in Canada.  While there are Canadian companies seeking to replicate Netflix in Canada, but so far they have stuck to the old DVD's by mail business model. 

Any hyper critical Canadian blames the Canadian Radio-Television & Telecommunications Commission (CRTC) for keeping Netflix out of Canada.  It would be easy to the CRTC to consider Netflix to be a foreign programming service that is not licensed by the CRTC to offer service to Canadians.  That would be the way it would be if Netflix was a traditional Cable network, but because Netflix is an online streaming service it faces no opposition from the CRTC.  In 1999 the CRTC declined to regulate the Internet because any attempt to do so would be pointless.  That's why Vonage can offer service to Canadians without a CRTC license.

The big American movie studios are the usual suspects that are still keeping Netflix.  Netflix says that their service is not available because of licensing issues.  The movie studios accept millions of dollars from Netflix to send DVD's and BluRay discs through the US Postal Service or stream across America through the Internet, but when it comes to licensing rights in Canada, movie studios will allow Canadian companies to send movies on discs through Canada Post to Canadians but online streaming in Canada is still off limits. 

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