Canada regulator orders streamers to pay to support local content

OTTAWA — Canada’s broadcasting regulator said Tuesday that streaming platforms such as Netflix and Disney would be required starting in September to contribute five percent of their Canadian revenues to fund local content.

The Online Streaming Act, passed in 2023, created a legal framework to regulate digital platforms and oblige them to contribute financially to the creation, production, and distribution of Canadian content, such as TV shows, as well as its promotion.

The Canadian Radio-television and Telecommunications Commission (CRTC) estimated that the measure — which effectively brings streamers under the same rules as traditional Canadian broadcasters — will provide Can$200 million (US$146 million) per year in new funding for the country’s broadcasting system.

“The funding,” the CRTC said in a statement, “will be directed to areas of immediate need in the Canadian broadcasting system, such as local news on radio and television, French-language content (and) Indigenous content.”

Online streaming services will be permitted some flexibility to direct parts of their contributions to support Canadian television content directly, it added.

Regulating web giants

The Canadian law is part of a series of recent measures introduced by the government to better regulate web giants.

For its part, the Digital Media Association (DiMA), representing Amazon Music, Apple Music, and Spotify, pushed back against the measure.

“We are deeply concerned with today’s decision to impose a discriminatory tax on music streaming services that are already making significant contributions to Canadian artists and culture,” DiMA president Graham Davies said in a statement.

The Motion Picture Association-Canada meanwhile said that global studios and streaming services already invest in content made by Canadian production companies.

READ: Leveling the playing field

“We are disappointed in today’s decision that reinforces a decades-old regulatory approach designed for cable companies,” president Wendy Noss said in a statement.

Canada’s Heritage Minister Pascale St-Onge maintained that the measure would ultimately benefit streamers.

“This is money that will go back into Canadian creation, whether it’s music, whether it’s a television series or movies, that will most likely go back on their platform,” she said.