By Ahmad Hathout
OTTAWA – The CRTC is proposing a new Canadian content contribution framework that would take into consideration different business models of the broadcasting services under the rules of the new Online Streaming Act.
Under the proposal, traditional and online streaming services would contribute a base amount of money toward a Canadian content support fund, such as FACTOR, Musicaction, and Radio StarMaker Fund. The funds are still to be determined.
CRTC officials said in a technical briefing with media Friday that they will have to determine first how it will come up with the formula to determine the base amount that applies across the system without exception.
But after that, if they do not make their full Canadian content obligations in the base amount, broadcasters and online services would be able to fulfill those obligations via two other categories under the proposal. A flexible financial requirement would allow for contributions in various programming, such as local news and training and development. The third category would be “intangible” contributions, which could involve making Canadian content more prominent (discoverability), creating a back catalogue of that content, or pitching an idea of equivalence to the regulator.
The proposal was announced Friday by the regulator, which officially launched its three public consultations on how to implement changes to the Broadcasting Act required under the new law passed last month. The law requires that online streaming services, including foreign players, contribute to the Canadian system where previously they were exempt via a digital media exemption order (DMEO).
“Someone might come and say…we would do it in thirds. We’ve assessed our contribution at a certain level — a third of it would be a contribution to a fund, a third of it would be our support for Canadian programming, a third of it might be what we’re calling the ‘intangibles,” a CRTC official said, adding the regulator would have to further figure out how to value those contributions.
“You can see that mix, and it would be different for each player,” the official said, emphasizing that all players are required to contribute to the base amount.
Comments on the proposal for the first hearing, which is on November 20 in Gatineau, are due June 27.
Comparable contributions from online streamers and other questions
Other questions the regulator will wrestle with during the first consultation includes whether initial contributions should be made by online streaming services – that is, platforms would be immediately required to put amounts into the Canadian content pool. The regulator will also try to determine “whether the overall contribution levels that online undertakings will be required to adhere to should be comparable to those currently in place for traditional broadcasters,” according to the consultation document.
The CRTC will also determine via the consultation whether online streaming services need to be registered with the commission, which services will be exempted and how to define “social media service.” Comments on who should qualify for registration and exemptions are due June 12.
It had proposed earlier this week, as part of its roadmap to the C-11 framework, that online services with annual revenues under $10 million not be required to register and that registration would not be required of individual Canadians or creators or user-generated content. It is also proposing to exempt companies that only provide online games and those services that offer one-time purchases or rentals of audio and video content. It reiterated that it “has no intention” to regulate algorithms, the machines used by online platforms to cater content to the viewer.
The third consultation will involve changes to the aforementioned exemption orders and “possible basic conditions of service to be imposed on certain streaming services.”
As such, the commission is asking the public to comment on whether it should or shouldn’t repeal the DMEO, which has been in place since 1999. The rationale from the CRTC’s perspective to possibly keep is because there may still be entities that rely on it to legally operate, and it is asking commenters to tell it which types of providers are still covered by the DMEO. If parties don’t agree that it should be repealed, the regulator is asking how it should be amended.
Comments on the DMEO question are due June 12.
“As we take on the task of modernizing the regulatory framework of the broadcasting system, we are focussed on ensuring that all players contribute equitably to Canadian and Indigenous content,” CRTC chair Vicky Eatrides said in a statement. “We are starting the conversation today by looking at how streaming services can contribute. The views of Canadians will be important at every step of the process, and we encourage everyone to participate.”
Valerie Creighton, Canada Media Fund president and CEO, said in a statement to Cartt: “As a transparent and essential component of Canada’s cultural policy toolkit, the Canada Media Fund has been a catalyst in the creation of successful Canadian and Indigenous content for domestic and global audiences. We look forward to participating in the CRTC’s upcoming policy proceedings on a modernized contribution framework to ensure robust and sustainable investment in both the CMF and the broader Canadian screen-based production industry.”
