Industry reacts to Broadcasting Act changes

Friends of Canadian Broadcasting, artist groups and networks share their thoughts, good and bad, on the update.

By: Jordan Pinto and Patti Summerfield

It’s been nearly 30 years since the Broadcasting Act was updated. And for nearly 10 of those years, the overwhelming majority of the Canadian content sector has called for updated legislation that addresses the arrival of foreign-based digital services in the domestic marketplace.

Canadian Heritage Minister Steven Guilbeault made moves to address those long-standing concerns on Tuesday, tabling a bill that, if approved, will see the Broadcasting Act updated to bring streaming services under domestic regulation, in addition to granting enhanced powers to the CRTC to oversee the process.

The proposed legislative amendment would bring “online undertakings” – a new category of broadcast undertaking denoting services designed for the transmission or retransmission of programs over the internet – into the Canadian regulatory tent.

By regulating these services, the liberal government projects that $830 million in additional funding could be running through the Canadian cultural ecosystem by 2023.

As soon as the bill was tabled this week, reaction came thick and fast from all quarters of the industry.

Advocacy group says bill still favours Big Tech over Canadian media

Friends of Canadian Broadcasting (Friends) is continuing to raise serious concerns about the proposed changes because, while supposedly written to bring Big Tech into line, the watchdog group says it is sadly lacking in its attempts.

Daniel Bernhard, executive director of Friends, says the bill is bad for Canadian media but is great for Facebook, Google and Netflix. It also makes no mention of the Liberal government’s promise to bolster CBC local service and several sections of the Act have been repealed or amended to remove protections for Canadian culture.

Bernhard tells MiC, “The first question is whether the bill will even pass. If there’s no action in the spring, the bill’s not going to go anywhere. I think broadcasters at local level who have been hit really because of COVID are waiting for relief, waiting for a sign from the government that they’ll do something about the crisis in the advertising market. They are waiting for a sign from the government that they’ll do something about the loss of subscription service revenue and viewers to unregulated services like Netflix – and they’re still waiting for that relief. This bill won’t provide any of it.”

For local broadcasters and media that depend on advertising, Friends suggests that the government could start to take measures to remove subsidies and incentives that exist for Canadian businesses to buy ads on Google and Facebook instead of their local broadcaster. Those ad expenses are tax deductible right now, for example, and that deductibility could be removed, as they have been for decades for Canadian brands advertising on U.S. TV and newspapers.

Bernhard says that the status quo subsidizes the Canadian industry’s competitors. “They’re taking 5% of the ad pie and they’re not producing anything. What they’re doing is bankrupting people who used to actually convert that ad money into valuable local programming that people really enjoyed and benefited from. The government doesn’t have much time. Broadcasters have laid off nearly 3000 since the pandemic started.”

How the broadcasters feel

Meanwhile, Canadian broadcasters said they’re still doing their homework on the proposed bill. “We are studying the bill closely and cannot comment further on any specific impacts at this time,” said Corus Entertainment, adding that it was “pleased that all parties have offered support for ‘levelling the playing field’ between Canadian broadcasters and foreign Internet broadcasters.”

Bell Media, CBC and Rogers Sports & Media all said simply that they are studying the proposed legislation.

The proposal also had its detractors, with industry lobby group Friends of Canadian Broadcasting arguing that giving the Commission oversight of regulating streaming entities is problematic. “Netflix and their ilk will be able to send their lobbyists to negotiate personalized deals with the CRTC, in secret. The CRTC will have no obligation to regulate them, but will be able to do so at their discretion. Penalties for non-compliance are minimal,” claimed Friends of Canadian Broadcasting in a statement.

Diversity efforts applauded

The CMPA applauded the move, calling it “important legislation that will address the monumental shifts that have occurred in the marketplace since the Broadcasting Act was last updated.”

Meanwhile, the Coalition for the Diversity of Cultural Expressions (CDCE), which includes more than 40 organizations including ACTRA, DGC and SOCAN, welcomed the “decisive” changes and called for rapid action, and the WGC also stressed the need to implement change quickly.

The Black Screen Office (BSO) commended the bill’s commitments to diversity and inclusivity, but said there is still significant work to be done. “While we are encouraged by this commitment, we will continue the dialogue to address the distinctiveness of anti-Black racism,” said the BSO in a statement.

As well, Reelworld and Independent Media Producers Associaton of Creative Talent (IMPACT) urged the Minister to discontinue the use of the term “racialized” and “refrain from grouping all distinct communities together.”

The next phase will see the Liberal government attempt to get the bill passed quickly into legislation, at which point the CRTC and various industry stakeholders will set about ironing out how the new regulatory framework could be applied. Exactly what this will look like remains unclear, but it is likely to involve industry-wide hearings to consider the needs of the various players across the content sector.

A version of this story appears in Playback Daily.