Oh-a oh by Jason Tester Guerrilla Futures (CC BY-ND 2.0) https://flic.kr/p/8GTS3h

Oh-a oh by Jason Tester Guerrilla Futures (CC BY-ND 2.0) https://flic.kr/p/8GTS3h


No Netflix Tax & No New Money: Reading Between the Lines of the Digital CanCon Consultation

Canadian Heritage Minister Melanie Joly’s release of the Canadian content in a digital world consultation is likely to spark renewed demands from industry stakeholders for more money from two main sources: unregulated Internet companies such as Netflix and the government. As I noted in my first post on the consultation release, there is a significant divide between the industry and the public on the issue.  Industry stakeholders emphasize more public and government support, while the public is focused on efforts to promote Canadian content.

The government will surely wait for the consultation to close before it adopts firm positions, but the new consultation paper makes it clear that not everything is on the table. In fact, the consultation adopts several notable policies and sends some signals about future funding sources.

First, it leaves little doubt that the government opposes new regulations on online video providers. The consultation states:

To respect how Canadians want to consume and interact with digital content, we are committed to net neutrality – the idea that a public information network like the internet is most useful if all content, sites, and platforms are treated equally. The way forward is not attempting to regulate content on the Internet, but focusing on how to best support Canada’s creators and cultural entrepreneurs in creating great content and in competing globally for both Canadian and international audiences.

Strong support for net neutrality and the avoidance of Internet regulation means that proposals to exempt Canadian content from data caps or mandate certain rules for online providers are off the table. In fact, if Canada moves forward with the TPP, it will have also agreed to a ban on limitations on access to foreign video providers and no discriminatory payment requirements. In other words, no Netflix tax.

Second, the government uses the consultation to suggest where more money may come from and it is not from Canadian tax dollars. It states:

Alongside the historic investment of $1.9 billion in arts and culture announced by the Government in Budget 2016, we need to modernize how government supports the creation, discovery and export of Canadian content.

By framing the consultation as an initiative that sits alongside already-announced funding, it seems unlikely that more funding will be viewed as the answer. Indeed, the government is pretty clear about where it thinks the money will come from: foreign markets. The consultation is littered with references to the issue:

Grabbing a bigger piece of the global pie is critical to building a strong and viable creative sector

With global markets increasingly open to Canadian businesses, capturing a greater slice of the global pie is one of the ways that we can support Canadian creators back home.

Export and international audiences will be critical to the future sustainability of Canada’s cultural sector and its economy. Partnerships and foreign financing are key.

When we collaborate across cultural sectors and with foreign partners, we create new opportunities for our creators to showcase their talents and find new pathways to audiences around the world.

What might this mean? A guess might be that the CRTC’s recent controversial decision on the definition of CanCon might be the tip of the iceberg as the government moves to open its funding programs to greater foreign participation, shifts more dollars toward promotion, adds support for new digital platforms, and continues to re-examine what qualifies as a Canadian production. Those reforms would be consistent with a policy document that refers to “innovation” 16 times, far more than the handful of references to funding and financing.

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