The Canadian Radio-television and Telecommunications Commission (CRTC) has taken a significant step towards modernizing the Canadian broadcasting framework with the  implementation of the Online Streaming Act, formerly known as Bill C-11.

This relatively new legislation is an amendment of the Broadcasting Act that mandates all online streaming services contribute meaningfully to Canadian and Indigenous content. The Online Streaming Act received Royal Assent on April 27, 2023. This initiated a number of changes aimed at integrating online streaming services into Canada's broadcasting system.

The CRTC is an independent quasi-judicial tribunal that is responsible for communication regulation across Canada. This body has been tasked with the implementation of any changes to Bill C-11. The implementation process involves very extensive public consultations, decision-making based on available data gathered during the public consultation, and balancing rapid regulatory actions with comprehensive stakeholder engagement.

Key Provisions and Implementation

Under the new regulations, all online streaming services must contribute 5% of their Canadian revenue to support the Canadian broadcasting system. This measure is expected to raise approximately $200M in the first year of its implementation, which is the 2024-2025 broadcasting year.

All the funds raised will be channeled towards critical broadcasting areas, including local news on radio and television, French-language content, Indigenous content, and content produced by and for equity-deserving communities, official language minority communities, and Canadians of diverse backgrounds.

This mandated framework is designed to address the rising and immediate needs within the Canadian broadcasting system. It will also ensure the steady flow of funding for diverse and inclusive content creation. While this mandate binds online streaming services, they have a say in how their contributions are allocated. This allows them to directly support Canadian television content if they choose to.

Industry Response and Public Consultation

The CRTC's decision was made following an extensive public consultation process, which included over 360 detailed submissions and a three-week public hearing with more than 120 groups. However, even with the big representation, some criticism emerged from various stakeholders.

Leading the critics is the Motion Picture Association-Canada (MPA-Canada). MPA-Canada argues that the new fees are a representation of not only outdated regulations set for cable companies but they are also set to hinder global streamers' ability to collaborate directly with any creatives from Canada.

They highlighted the significant contribution and investment already made by online streaming services and global studios when it comes to Canadian content. MPA-Canada estimates over $6.7B is contributed annually and that the funds are directed to the creation of Canadian content.

The sentiments are shared by the Digital Media Association, representing music streaming providers like Amazon Music, Apple Music, and Spotify. These companies also highlighted that the fees are both discriminatory and exacerbating Canada's affordability crisis.

Future Consultations and Regulatory Developments

Amidst all the criticism from big-name online streaming services, the CRTC has outlined a clear regulatory plan and plans to continue public consultations on various aspects of the Online Streaming Act.

Vicky Eatrides, CRTC Chairperson and CEO, emphasized the agency's commitment to moving quickly, listening carefully, and taking decisive action in implementing the new legislation. This is aimed at ensuring that all streaming services not only contribute significantly to Canadian and Indigenous content but also that the funds contributed are used for what they are intended for, Eatrides explained.

Future consultations are set to cover base contributions, the registration of online streaming services, exemption orders, basic conditions of service, and regulatory fees. Any future consultations will be centered around the independent Local News Fund and support for local news production by commercial radio, with the CRTC continuing to publish decisions as they are made.