Netflix doesn’t want to pay into Canadian Media Fund

Being forced to pay into funds is discriminatory, company says

Netflix says it shouldn’t be forced to pay into funds that are designed to support the creation of Canadian content, arguing that the country is better served by market competition than by regulating foreign online services.

The California-based company makes the argument in a submission to a government-appointed expert panel that will make recommendations for changing Canada’s laws governing broadcasting and telecommunications.

“Numerous online distributors offer an abundance of content, including Canadian content, on demand, anywhere and any time to anyone with access to the open internet,” the Netflix submission says.

“We do not subscribe to the theory that a “regulated investment” is more valuable than a consumer and market-driven one.”

RELATED: VIDEO — Netflix Canada plans biggest price hike yet as rivals step up

The 30-page submission, made public Friday, says Netflix is on track to “significantly exceed” a $500-million commitment to fund original content made in Canada under a five-year agreement announced in 2017.

The paper, dated Jan. 11, is one of many submissions to the expert panel, which is expected to complete its review by Jan. 31, 2020 — after the next federal election in October.

Although the panel hasn’t made the full collection of submissions public, some groups have released theirs — often in support of positions that have been made in previous public debates.

Stephane Cardin, Netflix director of public policy, said Friday that the company decided to release its position paper ahead the 2019 Prime Time conference next week, when it will be on a panel with groups that had disclosed their positions.

Netflix argues that foreign online services such as itself would face unfair discrimination if it’s forced by law to pay into the Canadian Media Fund, which it says currently denies it the same rights as Canadian-owned broadcasters and distribution companies.

“For certified CanCon, the Canadian broadcaster obtains “first-window” rights in Canada while Netflix, or another online service, gets international rights outside Canada and possibly second-window rights in Canada,” it says.

If foreign online services are required to contribute to the CMF without getting “first window” rights in Canada, Neflix says, it would be discriminatory.

“It would also effectively force foreign online services to subsidize Canadian broadcasters, and reinforce the market power of vertically-integrated incumbents.”

Alternatively, it says, if foreign services had equal access to the CMF “they would be drawn into competing with Canadian broadcasters or VOD services for the Canadian first window rights for publicly funded original Canadian content.”

When asked by The Canadian Press whether Netflix was calling for an end to the Canadian Media Fund, where Cardin was a vice-president for 12 years, he was unequivocal.

“Absolutely not,” he said. “We do not say that, nor do we advocate for it.”

Netflix noted that it faces increased competition from other foreign and Canadian video-on-demand services, including Bell Media’s Crave subscription service, and the newer ad-supported CTV Movies and CTV Throwback.

The Canadian Broadcasting Corporation, which receives funding from the federal government and advertisers, has also launched its new Gem online service to provide live and on-demand programming.

Netflix said it’s not trying to get special treatment under Canadian tax laws, and noted it will begin collecting and remitting a Quebec sales tax in January 2019.

“We will comply with tax laws if and when they legally are extended to services like Netflix,” it says.


Like us on Facebook and follow us on Twitter.

Just Posted

B.C. BUDGET: Surplus $374 million after bailouts of BC Hydro, ICBC

Growth projected stronger in 2020, Finance Minister Carole James says

Social media influencers promote Fernie

MountainGirls, The Lady Alliance founders stop in Fernie on western Canada RV tour

Elk Valley mine deaths prompt safety initiatives

Teck produces educational video, introduces new procedures after contractor drowns at Fording River

Fernie SAR rescues stranded snowmobiler; buried skier

Skiers caught in Mt. Fernie avalanche; snowmobiler spends night in backcountry after breakdown

Elk Valley RCMP issues 40 traffic tickets in 21 days

Logging truck driver fined after trailer wheels catch alight

‘Riya was a dreamer’: Mother of slain 11-year-old Ontario girl heartbroken

Her father, Roopesh Rajkumar, 41, was arrested some 130 kilometres away

GALLERY: Fernie Ghostriders get their home game mojo back

Riders post 6-1 win over Columbia Valley Rockies; prepare for playoffs

Do you live with your partner? More and more Canadians don’t

Statistics Canada shows fewer couples live together than did a decade ago

B.C. child killer denied mandatory outings from psychiatric hospital

The B.C. Review Board decision kept things status quo for Allan Schoenborn

Searchers return to avalanche-prone peak in Vancouver to look for snowshoer

North Shore Rescue, Canadian Avalanche Rescue Dog teams and personnel will be on Mt. Seymour

Market volatility, mortgages loom over upcoming earnings of Canada’s big banks

Central bank interest hikes have padded the banks’ net interest margins

Hearings into SNC-Lavalin affair start today, but not with Wilson-Raybould

She has repeatedly cited solicitor-client privilege to refuse all comment

VIDEO: 8 things you need to know about the 2019 B.C. budget

Surplus of $247 million with spending on children, affordability and infrastructure

B.C. pot giant Tilray to acquire hemp food company Manitoba Harvest for up to $419 million

Tilray will pay $150 million in cash and $127.5 million in stock.

Most Read