- Global streaming giants are challenging new Canadian regulations requiring them to contribute 5% of their Canadian revenues to support local news and broadcasting.
- This contest highlights the tension between national regulators and global tech firms.
OUR TAKE
Canada’s new rules aim to boost the development of domestic streaming services at the expense of companies’ costs. The government’s intention, though, is understandable, but the circumstances resulting from the implementation seem to be frustrating in the long run, which may discourage investment in the Canadian market and thus restrict diverse availability for Canadians.
–Ashley Wang, BTW reporter
What happened
Global streaming giants, including Netflix and Walt Disney, are contesting new Canadian regulations that require them to contribute 5% of their Canadian revenues to support local news and broadcasting. The challenge, led by the Motion Picture Association-Canada, was announced last Thursday through applications for judicial review filed in a federal court. The association, representing major streaming services, argues that the Canadian Radio-television and Telecommunications Commission (CRTC) has acted unreasonably and without a legal basis for this demand.
The CRTC has defended its decision by highlighting the urgent need for funding in key areas of the Canadian broadcasting system. The regulator emphasised that the contributions from streaming services would ensure the sustainability and enhancement of local news on radio and television, as well as support French-language and Indigenous programming. However, the CRTC has declined to comment further, citing the ongoing court proceedings.
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Why it’s important
The contest underscores the growing tensions between national regulators and global tech companies over financial contributions to local media ecosystems. The outcome of this legal battle could set a precedent for how countries worldwide engage with and regulate international streaming services, potentially influencing similar regulatory approaches in other markets.
For streaming companies, the ruling could impact their operational costs and strategic decisions regarding market participation and content investment in Canada and beyond. The streaming industry is significantly opposed to the rules as it may impose an extra financial burden on foreign companies. The rules will be implemented in September, and only then can the real impact be observed.
