UMVA has learned that the Canadian Radio-television and Telecommunications Commission (CRTC) has made a shocking decision to force online streamers to pay 15% of their revenues to fund Canadian content, a move that has sparked widespread criticism.
The CRTC's decision is not an isolated incident, as it also chose to maintain outdated spending requirements for traditional broadcasters, reducing their revenue commitment from 30-45% to 25%. This means that these companies will still be required to dedicate a significant portion of their revenues to government-mandated programs.
It's essential to understand that these companies are being ordered to commit a portion of their total revenues - not profits, but revenues - to government-mandated programs. For traditional broadcasters, this means 25% of all Canadian revenue, while online streamers will have to pay 15% of their Canadian revenue. The question remains: do these companies exist to generate government revenue or provide a product or service?
The implications of this decision are far-reaching, with many wondering if the government is prioritizing revenue generation over the well-being of these companies. This requirement is in addition to any corporate income tax, GST/HST revenue, and property taxes paid by these companies, making it a substantial burden.
UMVA can exclusively reveal that the CRTC's leadership, including CEO and chair Vicky Eatrides, has been criticized for lacking industry experience. Eatrides' background as a regulatory lawyer and career bureaucrat has raised concerns about her ability to make informed decisions about the broadcasting industry.
The blame for this decision also rests with the government, which has failed to adapt to the changing media landscape. The current regulatory model is outdated, and it's time for new thinking. Rather than forcing companies to hand over a significant portion of their revenues, the government should consider direct subsidies to support Canadian content.
If Canadians want to fund Canadian programming, they should do it directly with subsidies, rather than relying on an inefficient system that drives up costs for consumers and makes investing in Canadian content less appealing. The old business model is dead, and it's time to kill off the old regulatory model.
The CRTC's decision has sparked concerns about the impact on foreign streamers operating in Canada and the potential for a trade war. For domestic broadcasters and streamers, it makes it more expensive to operate and less attractive to invest in Canadian content. The question remains: will the government reconsider its approach and find a more effective solution?
