The Canadian Radio-television and Telecommunications Commission (CRTC) recently released a much-anticipated policy that provides an overview of new funding obligations for online streaming platforms. This is an important step in this perpetual battle for the discoverability of content and the vitality of cultural industries in digital worlds.
In summary, the CRTC imposes on online streaming platforms that are not linked to Canadian broadcasters – read Netflix, Disney+ and other viewing platforms – a “basic contribution” aimed at financing Canadian production in all its diversity. The funds, estimated at $200 million per year, will be used to finance local news on radio and television, indigenous, francophone or minority group content. The expected amounts correspond to 5% of the Canadian revenues of large foreign platforms.
The CRTC’s opinion results from the adoption of the Online Streaming Act in spring 2023, itself preceded by the work of the Yale commission. Despite the obstruction of the Conservatives and the work of undermining the proponents of non-interventionism in the digital economy, the Trudeau government has succeeded in laying the foundations of a coherent framework from which we can consider the overhaul of the cultural industries.
The 200 million required from online platforms may seem insufficient in the eyes of some. We are far from the hypothesis of 830 million put forward by government representatives during the study of the bill. Despite everything, this reform carries a principle that players in the media and cultural circles have been hammering home for almost ten years. All companies that benefit from the Canadian broadcasting system and its market must contribute to the creation and financing of production. Yes, that includes cross-border digital streaming giants.
This principle was self-evident during the bygone heyday of analog culture. The cultural industries were well regulated, sometimes even too much, and the various funding bodies, independent of the State, assumed their function of redistributing public and private funds with quotas to respect linguistic duality, particularly in radio.
Enter the digital revolution and the dizzying rise of online distribution platforms, free from all constraints. They had nothing to do with this old order, and how can we blame them? For years, many democratic states around the world have neglected to modernize their legislative framework, to the point of switching towards not asserting their cultural sovereignty in digital worlds. The European Union was the first to reverse the trend.
For a country like Canada, founded on principles of linguistic duality, laissez-faire represented a safe passage towards cultural homogenization. It is already well at work, as evidenced by the transformation of consumption habits towards foreign online distribution platforms, the difficulties of finding original French-speaking content there and the exclusion of creators or producers of contents of the value creation chain.
Content will be king, it was trumpeted at the beginning of the nascent Internet revolution, more than a quarter of a century ago. Very good, but we have lost sight of the essential. Retail would become the emperor, and it would be driven by the profit ethic, vision and interests of Silicon Valley. It is a risk factor for the diversity of cultural expression which will not disappear anytime soon, and which will gain in importance thanks to a new revolution driven by generative artificial intelligence.
The Online Streaming Act and the CRTC directives will not change these trends alone, but they set original milestones, notably by relying on existing organizations, such as the Canada Media Fund, to manage funds. Social media, podcasts, video games and audio books are not taken into account, which alleviates criticism of the risks of excessive taxation of digital uses. The regulatory framework only applies to professional music, films and online TV series. Linguistic duality is also in the spotlight, with a distribution of funds at 60% for English-language content and 40% for French-language content. First Nations and linguistic minorities are not left out in this inclusive regime.
Associations representing the Quebec cultural community have unanimously underlined the relevance of this reform, which is largely preferable to the status quo. The Law on Continuous Online Dissemination is a way to prevent the future from being made up of a culture translated from American. It will be necessary to remember this at the dawn of a federal political cycle heralding a vigorous debate on these public policy questions.