Canadian Heritage Minister Melanie Joly seemingly put the prospect of an Internet tax to bed when she launched her Creative Canada report last month. Throughout the year-and-a-half consultation, there were persistent rumours that an Internet tax was being considered as a mechanism to help fund Cancon. Yet when the Prime Minister rejected an Internet tax last June minutes after it was proposed by the Standing Committee on Canadian Heritage, the policy initiative promoted by some cultural lobby groups seemed dead. Joly’s comments at her policy launched suggested much the same:
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Netflix Canada and the Misleading Claims About “Level Playing Fields”
Canadian Heritage Minister Melanie Joly’s plan for digital Cancon has attracted considerable criticism, particularly the Netflix commitment to spend $500 million on productions in Canada over the next five years. Companies and commentators have argued that the deal creates an “uneven playing field”, noting that Netflix faces different obligations than Canadian companies for both tax collection and contributions to creating Canadian content. In both cases, however, the uneven playing field argument in favour of Netflix does not withstand even mild scrutiny.
Joly’s Digital Cancon Plan: Netflix May Be The Star, But No New Regulations, Taxes or Bailouts is the Story
Canadian Heritage Minister Mélanie Joly presented her vision for digital Cancon earlier today, delivering a wide ranging plan that included previously leaked information about a commitment from Netflix to spend $500 million over five years on production in Canada. The Netflix commitment is the headline of the day, though earlier reports inaccurately claimed that the funding would be for Canadian content rather than productions in Canada (the two are not the same given the restrictive approach to Cancon definitions).
The agreement represents a major long-term commitment to the Canadian market which should go some way to appeasing critics who feared that the company might abandon Canadian production in the future. However, since Canada was already one of the company’s top three countries for production, it may not result in a significant increase in funding.
Not Just Netflix: Government Asks the CRTC To Conduct a Review of Changing Broadcast Models
Canadian Heritage Minister Mélanie Joly will formally unveil her digital Cancon strategy on Thursday, but aspects of the plan are already coming to light. There have been several reports about an agreement with Netflix to commit $500 million to production in Canada over the next five years. Assuming this is accurate, it may not necessarily mean a big increase in spending (Canada was already one of the top three markets for Netflix production) but it will provide certainty about the company’s commitment to Canada.
It would also appear that the government envisions asking the CRTC to become involved in developing policy, particularly with respect to upcoming review of the Broadcasting Act and Telecommunications Act. An Order-in-Council has just been posted online that requests that the CRTC conduct a study on programming distribution models and their impact on the maintaining a “vibrant domestic market.” The report will examine:
Joly’s Challenge: Digital Cancon Without New Digital Tax Dollars
After months of public consultation and debate, Canadian Heritage Minister Mélanie Joly will unveil the government’s plan for Canadian content in a digital world this week. Joly launched the digital Cancon consultation in the spring of 2016 by emphasizing that all policy options were on the table, but the choices have narrowed considerably in recent months.
My Globe and Mail op-ed notes that a potential Netflix tax was a non-starter due to a 2015 election campaign commitment, Prime Minister Justin Trudeau eliminated the possibility of an Internet tax in June, and the government has steadfastly (and rightly) defended net neutrality, meaning there will be no mandated prioritization of Canadian content on the Internet.
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