Bell has asked the Canadian Radio-television and Telecommunications Commission (CRTC) to create a news fund that would subsidize broadcasters, and which will force foreign streaming services to contribute to the fund through their Canadian content spending.
Foreign streaming services, the company argued, “continue to grow and expand”, while traditional broadcasters “are in trouble” and “no longer financially viable.”
The company also asked CRTC to exempt its streaming service, Crave, from Bill C-11 as long as the requested regulatory relief is not achieved.
“Imposing obligations on online undertakings affiliated with traditional broadcasters will make things worse for us in the interim – at a time when further regulatory burden is the last thing our industry can bear,” affirmed Bell Canada’s vice president of regulatory law, Jonathan Daniels.
This comes after Canadian Heritage last week issued the final policy direction to the CRTC, to enact the legislation within two years following its passage in April.
This first public hearing will deliberate on the contributions online streaming services will need to make to support Canadian and Indigenous content.
Daniels criticized the approach of the CRTC, which he said is severely burdening traditional broadcasters who already find themselves in a crisis due to declining revenue and increased competition from foreign streamers.
“Your priorities are backwards,” said Daniels. “Traditional broadcasters, the lynchpin of the Canadian broadcasting system, need relief – and we need it now.”
The company filed two applications to the CRTC earlier this year seeking regulatory relief for its broadcasting business, including a reduction in how much it ought to spend for Canadian content on its television stations and on local news.
Justin Stockman, vice-president, content development and programming, Bell Media, explained that the company traditionally uses revenues generated by airing U.S. content to invest in Canadian content and news. But now, he said, U.S. content is more difficult than ever to access, notably as competition drives up prices.
He continued, “Instead, U.S. studios are selling their content directly to Canadian consumers through their own streaming platforms, putting our ability to fund Canadian content and news at risk.”
Quebécor-owned Groupe TVA also detailed the financial woes of the broadcasting industry during the ongoing hearing, emphasizing the decline of their audiences, advertising and subscription revenues as well as the increase in the cost of broadcasting rights.
During the hearing, Quebécor chief executive Pierre Karl Péladeau read old testimony he gave back in 2011, warning the Commission of “the birth of an inescapable vicious cycle whereby the Netflixes of this world will deliver fierce competition in our territory, customers will unsubscribe from local distributors like Vidéotron, and Canadian content funding will keep plummeting.”
“Unfortunately, twelve years later, it is clear that absolutely nothing has changed, and those challenges have only exacerbated,” he added.
Both Bell and Quebécor also complained about the cuts they had to make: 1300 and 600 jobs, respectively, this year.
Meanwhile, YouTube said on Monday that it’s clear that the government has directed the
CRTC to exclude the vast majority of its platform from this regulation. It, however, requested a number of amendments that would take into account, for instance, the contribution it already makes towards Canadian content, its business model and more.
The hearing, set to last three weeks, will hear from biggies like Netflix, Paramount, Rogers, Apple, Spotify, Amazon, Telus and others.