Netflix, Apple and More Challenge CRTC’s Early Cancon Funding Plan

Major streaming platforms, including Netflix, Amazon, Spotify, Apple, and Disney, are challenging the Canadian Radio-television and Telecommunications Commission (CRTC) over a proposal to require them to contribute to the Canadian content (Cancon) system.

The objection arises before the regulator has fully defined Cancon for streamers or established its regulation mechanism, reports The National Post.

In April, Bill C-11, now known as the Online Streaming Act, was enacted. This legislation empowers the CRTC to regulate streaming platforms, compelling them to feature Canadian content and contribute to the Cancon fund, which supports the creation of Canadian movies, TV shows, and music.

However, these platforms have voiced opposition to the CRTC’s suggestion for an “initial base contribution,” which would see the platforms pay a percentage of their Canadian revenues towards Cancon. The regulatory process could take years to complete.

In a written submission to the CRTC, Apple noted, “a base contribution may discourage direct investments of the sort the Commission intends to encourage,” such as directly investing in producing a Canadian film.

Apple also warned that “setting any contribution requirements without first revisiting the definition of Canadian programming … could be problematic in and of itself and also further compound the problem with establishing an initial base requirement.”

Likewise, the Motion Picture Association-Canada (MPA), representing major studios including Disney, Netflix, Paramount, Sony, and Warner Brothers, said that considering an initial base contribution requirement at this stage is “putting the proverbial cart before the horse.”

Spotify expressed similar concerns, stating that the CRTC is “moving too quickly to impose base contributions,” without considering “the broader ecosystem of meaningful contributions to the Canadian broadcasting system made by online undertakings overall.”

All these platforms argue that they already contribute to Canadian content by producing movies, TV shows, and other content in Canada. They urge the CRTC to define Cancon contributions flexibly, with options other than merely paying into a fund.

Amazon noted, “nowhere on the public record before the Commission is there robust, up-to-date data on the different forms and full extent of the direct and indirect expenditures already being made by online undertakings in Canada.”

For instance, Disney favoured a framework that allows platforms like Disney+ “the flexibility to commission or acquire local Canadian programming and/or make other contributions to the Canadian broadcasting system that are consistent with our brand, business model, and the nature of our service.”

Netflix argued that the CRTC’s “preliminary determination” to require an initial base contribution risks preempting discussion on many critical elements of the new contribution framework that should be considered first.

Do you care about Cancon requirements for streaming giants? Or do you just watch great content you want, regardless of where it’s produced—and without the government suggesting it to you (or shoving it down your throat)?

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