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Is the CRTC capitulating to the streaming giants?
Large Canadian and foreign programming and distribution broadcasters benefit from significant economies of scale through broadcasting and streaming, a high degree of industrial concentration, and the power to monopolize or control their markets. (File Photo: Erik Mclean/Unsplash)
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At the end of March, the Canadian Radio-television and Telecommunications Commission (CRTC) will begin the most important public hearing of the decade for Quebec and Canadian television. The goal is to rewrite the definition of a Canadian program and establish a new regulatory framework for programming by conventional and online television broadcasters.
However, the commission’s preliminary approach set out in Broadcasting Notice of Consultation CRTC 2024-288 risks undermining our national identity and cultural sovereignty – the protection of which are at the heart of the Broadcasting Act.
For nearly two years, the commission has been working to implement the new Broadcasting Act, as amended in April 2023 by the Online Streaming Act. It’s a titanic task, aimed above all at integrating the streaming giants (Netflix, Amazon Prime, Disney, Spotify…) into our broadcasting system and obliging them to make a minimal contribution based on their earnings in Canada.
Needless to say, the web giants are strongly opposed to this initiative, and are doing everything in their power to render ineffective any amendment by Canada’s Parliament that directly affects them.
Strong growth in foreign location shooting in Canada
Foreign television and film location shooting in Canada by the web giants and Hollywood studios has increased dramatically over the past decade, assisted by the low value of the Canadian dollar, federal and provincial tax credits, and the excellence of our audiovisual technicians and craftspeople.
However, these productions use few, if any, Canadians in key creative positions (writer, director, actors, art director, cinematographer, editor, music composer) and, as a result, are not recognized as Canadian content by the CRTC. Moreover, their location shooting is almost never in French.
The American giants prefer to rely on key creators who are familiar to Hollywood and American audiences. Quebecers and Canadians can be hired for these productions, provided they are familiar enough. Denis Villeneuve, Jean-Marc Vallée, Yves Bélanger and Jessica Lee Gagné are recent examples of those who have had successful careers in the U.S., but they are few and far between.
CRTC prepares to make huge concessions
Now that the CRTC is planning to impose new Canadian programming obligations on the streaming giants, their chief representative, the Motion Picture Association Canada, is trying to convince the commission to redefine “Canadian programming” so that it essentially conforms to what they already produce.
The streaming giants want their location shooting in Canada (sometimes called “runaway Hollywood” production) to be counted as Canadian content although they ignore the current minimum requirements of a Canadian program – the presence of key Canadian creators, including a screenwriter or director, at least one Canadian in a lead role, a Canadian producer and 75 per cent of production spending on Canadian elements. They want to avoid any changes to their current mode of operating and any additional expense, but still count their location shooting as Canadian.
Unfortunately, in its preliminary approach, the CRTC is conceding a great deal to the streamers and American studios. Seeking to “modernize” the current criteria for a Canadian program, the commission proposes to qualify the secondary positions of costume designer and senior make-up artist as key creative positions, to replace the music composer with Canadian rights holders (regardless of the music’s origins), and to introduce the concept of “showrunner,” a term borrowed from American productions.
Fewer Canadian creators, more financial control
Indeed, the concept of a “showrunner” in a production (a kind of screenwriter-producer) is an American practice recently introduced to Canada that does not exist in French-language production and is not recognized in collective agreements between writers and producers.
Under the CRTC’s proposal, a “showrunner” could replace the original screenwriter of a Canadian program. So, with a showrunner, costume designer, make-up artist and Canadian music rights holder, a foreign location shoot in Canada would come very close to qualifying as Canadian content. What’s more, the CRTC would allow non-Canadians to occupy up to 20 per cent of the key creative positions – if the position is held by more than one person – in the name of “flexibility,” the creation of “foreign partnership opportunities” and “exportability.”
If it were acceptable for only 80 per cent of a key position to be held by a Canadian, a writer or director responsible for shooting the pilot episode of a drama series could determine the majority of the series’ artistic choices, without being Canadian. All in all, the commission is suggesting that the very meaning of an original Canadian program be significantly altered.
A redefinition that benefits the streaming giants
Compared to its current definition of a Canadian program, the CRTC’s preliminary approach makes a significant concession to Canadian ownership of intellectual property. Going beyond the new requirements of the Broadcasting Act and the Canadian government’s November 2023 policy direction, the commission proposes that the intellectual property of any Canadian program be entirely Canadian.
Thus, the commission offers a kind of trade-off in its overall proposal for the definition of a Canadian program – a reduction in the presence of key Canadian creators and creative control, in exchange for a strengthening of ownership and financial control by Canadian producers and broadcasters.
The result of the changes introduced by the CRTC’s preliminary approach would be a redefinition of a Canadian program that favours the streaming giants, American studios and even the major Canadian broadcasting groups (BCE, Rogers and Videotron) to the detriment of key Canadian creators, who would see their presence considerably reduced in the commission’s proposed definition.One of the consequences of these changes would be to allow a significant number of foreign productions in Canada to be reclassified as Canadian programs – provided the web giants and studios agree to work with a Canadian production company.
Thus, the measured volume of Canadian “exports” could increase without necessarily affecting the total volume of activity. Production teams with few key Canadian creators could meet the CRTC’s new requirements for spending on Canadian programs. This is not a result that respects the Government of Canada’s policy direction, which directed the commission to “support Canadians holding a broad range of key creative positions, in particular those with a high degree of creative control or visibility.”
Protecting creators while promoting co-productions
What’s the solution? The best option would be to retain the broad outlines of the current definition of a Canadian program to ensure the place of key creators in Canadian content. At the same time, the CRTC could maintain the definition of an “international co-venture,” which allows foreign producers from countries that do not have an official co-production treaty (sanctioned by the Canadian government), including the U.S., to participate in the production of Canadian programs under more flexible criteria regarding intellectual property and financial control.
This approach would comply with the new requirements of the Broadcasting Act and the Canadian government’s recent policy direction with respect to intellectual property. Obviously, a ceiling would have to be placed on the use of such co-ventures to prevent excessive use by foreign online broadcasters.
Large Canadian and foreign programming and distribution broadcasters benefit from significant economies of scale through broadcasting and streaming, a high degree of industrial concentration, and the power to monopolize or control their markets. Add to this, the imperfect information available to consumers, and the tendency of web giants and U.S. studios to operate without regard to the laws and sovereignty of nations.
In this period of political and economic instability, it is essential that the CRTC stand firm and continue to defend the fundamental objectives of the Broadcasting Act, including our national identity and cultural sovereignty, which safeguard, enrich and strengthen the country’s cultural, political, social and economic well-being.
This article first appeared on Policy Options and is republished here under a Creative Commons license.
