LILLEY: Mark Carney government makes right move with streaming decision
· Toronto Sun
The Mark Carney government is walking away from a policy that was bad for Canadian consumers, bad for Canadian industry and would have hurt trade negotiations . That doesn’t mean they aren’t being criticized as economically illiterate arts organizations are furious with them, but they did the right thing.
On Wednesday morning, Canadian Identity and Culture Minister Marc Miller issued a news release saying he was asking the Canadian Radio-television and Telecommunications Commission to reconsider their call for online streamers to pay 15% of their Canadian revenues toward Canadian content projects and Canadian broadcasters to pay 25%.
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The idea was a bad one both from a domestic and a trade perspective. It would drive up costs for consumers on streaming services like Netflix, Prime Video or Disney+, while also making life more expensive and less competitive for Canadian broadcasters.
Bizarrely, while the ruling required foreign streamers like Netflix to pay 15% of their Canadian revenues to support Canadian content, it required Canadian streaming platform Crave to pay 25% of their revenue toward Canadian content.
Carney moves to direct subsidy model for CanCon
In place of the demand that broadcasters and streamers pay into a fund, the Carney government is committing $600 million toward Canadian content. This replaces an indirect subsidy that was inefficient, politically charged and could have killed off trade talks with the United States with a cleaner direct subsidy.
Eleanor Noble, the national president for the ACTRA union that represents English-speaking radio, TV and video performers, blasted the Carney government in a statement.
“Today’s decision lets billionaire streamers and studios completely off the hook. Rather than requiring wealthy media companies to modestly invest in Canada’s cultural ecosystem, Ottawa has chosen to transfer that responsibility to Canadian taxpayers,” Noble said.
That is exactly why you should never allow actors to have a say in economic issues; they are economically illiterate. If the 15% requirement and 25% requirement of revenues on Canadian content had been allowed to stand, it would have driven up prices to consumers.
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Economic illiteracy running wild
No company will, or can, be told by a government to hand over 15-25% of their revenues — not profits, but revenues — without factoring in an increase in price to make up for the difference. Noble doesn’t get that; she thinks these companies will just magically give that money from the goodness of their heart.
All broadcasters in Canada are now struggling, other than the government-funded CBC. Global/Corus is constantly on the brink of collapse and Noble wants Canada’s broadcasters to hand over 25% of their revenues to a government-mandated fund?
As for the American streamers, pushing the 15% revenue requirement on them would make them less likely to invest here, to film productions here – meaning less work for Noble’s members – and less likely to expand here.
If the government wants to fund and subsidize Canadian content, do it directly. Don’t come up with an elaborate plan that forces companies to do it in a way that forces prices up for consumers.
Carney made the right move
Some Canadians will be upset with the Carney government for dropping a demand that American streamers pay up.
That’s the wrong attitude to take.
There needs to be a level playing field for the American streamers and the Canadian broadcasters/streamers when it comes to Canadian content and paying for it. That level playing field should be that neither of them are required to pay for it.
If the decision of the government of the day is that Canadian content needs to be subsidized, then government and not business should be the one doing it through the tax base.
Given that both Democrats and Republicans opposed this streaming tax , this was going to be a major issue for Canada in trade talks. I, for one, am not willing to trade off jobs in steel, lumber or autos to make Noble and her ACTRA members happy.