Will your list of Netflix Inc. (Nasdaq:NETFLIX) shows awaiting a binge-watching session soon adopt a quintessentially Canadian character?
It’s an idea being floated by domestic producers attempting to adapt to the changing media landscape brought on by foreign over-the-top (OTT) streaming services like Netflix, Amazon Prime Video and CBS All Access.
“Regulation of these services is absolutely inevitable – it will happen,” said Reynolds Mastin, president and CEO of the Canadian Media Producers Association (CMPA).
Ottawa signalled as much when it announced in June a review of the Broadcasting Act and the Telecommunications Act. The review comes as part of a bid to support the continued creation of domestic content as foreign OTT services build up Canadian subscribers.
Mastin has been meeting with Canadian producers since July, stopping in Vancouver September 13 to pick the brains of local industry experts to see how they can work with major foreign players to bring about an “equitable playing field.”
“One thing that we were very pleased about when the government announced its review was that it reaffirmed one of the foundational principles of our entire broadcasting system,” Mastin said.
“And that is, those that benefit from the system must also contribute to it.”
The Canadian Media Fund (CMF) relies on a percentage of revenue from traditional broadcasters to help fund Canadian content.
OTT services like Netflix have been absorbing the same Canadian audiences broadcasters have relied on, but are under no obligation to pay into the CMF.
The CMF contributed $342.3 million to Canadian TV and digital media projects in the 2017-18 fiscal year compared with $361.6 million a year earlier.
As traditional broadcast revenue diminishes and the size of the CMF shrinks, domestic producers face the prospect of no longer being enlisted to make as much Canadian content.
B.C. producer Trish Dolman, who attended the Vancouver stop on Mastin’s listening tour, said her fellow producers have been shifting more toward global audiences to keep revenue coming in.
“But to get there we need to focus on talent development, and I don’t know how you do that, say, in a landscape that is completely unregulated,” said Dolman, who has produced works such as Indian Horse and Canada in a Day as president of Screen Siren Pictures.
“How do we stay competitive in a world that has Netflix where they’re not facing those [Canadian content] requirements?”
Then-heritage minister Mélanie Joly announced in September 2017 that the federal government’s Creative Canada framework would require a $500 million investment from Netflix to create a new production company to invest “in original production in Canada” over five years.
The money isn’t meant to exempt Netflix from future regulation. Meanwhile, $25 million of the committed funds have been earmarked for talent development.
Netflix, the CMPA and Creative BC, the provincial agency that promotes the province’s film and TV sectors, announced in August the creation of the Pacific Screenwriting Program’s scripted series lab.
The lab is focused on professional development of local screenwriters and is being funded by Netflix, the CMPA and Creative BC.
Meanwhile, Dolman suggested that the government should also examine the creation of two frameworks in which to operate.
One would be for large foreign producers making content for global audiences; the other, for domestic producers who would have access to additional incentives for creating strictly Canadian content.
Mastin said the CMPA has also been working with other stakeholders, including informal talks with the foreign OTT services, on ideas to create a more level playing field.
Possible measures involve OTT services providing a percentage of revenue to produce Canadian content or an exhibition requirement that gives Canadian content prominent display on OTT platforms when users log in.
Mastin said the intention isn’t to push measures on OTT services that won’t work for their businesses, but he expects a “robust” conversation ahead with stakeholders.
“We want a regulatory regime that makes business sense for all the players, and that’s fair to all the players and that achieves the overriding goal of producing great stories that Canadian and global audiences get to enjoy.”