Just over 11 years ago, I wrote a column for the Toronto Star titled U.S. Web-Streamed TV Could Change Game for Canadian Broadcasters. The piece argued that Internet streaming of television was in its infancy, but could soon become the norm with major implications for Canadian broadcasters:
While the use of the Internet to by-pass Canadian broadcasters is still relatively rare – most U.S. programs bundle the broadcast and Internet rights together – the decision to stream the games directly into the Canadian market could soon become the norm. The key determinant will obviously be money. Once U.S. rights holders conclude that it is more profitable to retain the Internet rights so that they can stream their programs online to a global audience and capture the advertising or subscription revenues that come with it, Canadian broadcasters may find that they can only license broadcast rights with the U.S. rights holders competing directly with them via the Internet.
I continued by noting that the Internet was on the verge of disrupting the longstanding Canadian broadcast model and its reliance on cheap U.S. programming. I speculated that the result would be that Canadian broadcasters would recognize the need to create their own content that they could licence online around the world.
That column came to mind during Bell’s appearance before the Heritage committee on Bill C-11 yesterday. The company extolled the good old days of cheap U.S. content that could be monetized through simultaneous substitution policies (that allow Canadian broadcasters to substitute their commercials over U.S. ones) in a system that “put Canadian broadcasters at the centre of the broadcast ecosystem.” That position is ironic given that the foundation of CRTC policy under Jean-Pierre Blais was that Canadians – not Canadian broadcasters – should be at the centre of their communications system.
But Bell wants to put the toothpaste back in the tube with measures that could limit consumer choice and competition. This is how they put it:
Our access to popular US shows has become increasingly challenging and expensive. Foreign streamers are bidding up the cost of programming. But even more concerning is that major U.S. studios have either cut out domestic broadcasters altogether or are about to do so. Disney+ and Paramount+ are already using their streaming platforms to reach Canadians directly. Others, like HBO, have launched their own OTT platforms in the US and could still do so in Canada. With the ability to go to Canadians direct on an OTT basis, we are starting to see these platforms starting to refuse to sell us their content altogether.
So why does this matter?
It matters because it puts all we do – I mean all Canadian broadcasters – at risk. Canadian broadcasters produce Canadian news that quite simply is essential to our culture, to protecting our democracy, and to our national sovereignty. But let’s not delude ourselves. The entire Canadian broadcasting ecosystem is funded by profits from foreign content. We cannot expect broadcasters to continue to produce and support Canadian content that we do without access to foreign content and partnering with foreign players.
We can ensure the central role of Canadian broadcasters by securing access to foreign content. We can also incentivize foreign streamers to partner with Canadian broadcasters, much like foreign linear services have done for decades. We believe Bill C-11 should explicitly enable this.
The implications of securing access to foreign content or “partnering” with Canadian broadcasters is less consumer choice, less competition, and less visibility of Canadian content. The partnerships were designed keep U.S. broadcasters out of Canada (instead licensing their brand or content to a Canadian provider) resulting in less consumer choice and competition. And the continued reliance on U.S. content during prime time schedules means that Canadian content creators are relegated to secondary status in their own country.
If I could see this more than a decade ago, surely Canada’s largest broadcaster could have anticipated the current situation and invested in more than just long-term licences with U.S. services such as HBO and Showtime. The arrival of streaming services and direct-to-consumer opportunities bring down the walled garden and force Canadian broadcasters to create and compete.
That the committee should reject Bell’s anti-consumer and anti-creator proposals is obvious. Beyond that, however, perhaps the government will wake up to what it’s heard this week at committee. The foreign streamers and the largest entertainment union talked about jobs, multi-billion dollar investments in Canada, and platforms that have enabled a new generation of Canadian creators to succeed on the global stage. Canadian broadcasters, including Bell, Corus, and Quebecor, all called for deregulation or increased reliance on U.S. content.