How Foreign Streamers Could Save a Canadian Industry on the Brink

Comedy Series
Courtesy of PopTV

Canada forcing Netflix and other foreign streamers to pour $800 million annually into local Canadian content will be a lifeline for world-beating creators, say Bill C-10 supporters.

Canadian TV producer Gordon Loverin recently opened an email from Netflix after pitching the American streaming giant on Kanata, a fantasy sci-fi series about First Nation explorers landing on the shores of Europe in 1492 to save their people from extinction.

To his surprise, Loverin and Kanata co-creator and co-writer Pamela Jones discovered they'd been plucked from among 10,000 submissions from Canadian producers to formally pitch their TV series to Netflix in mid-January. "We knew we had a good project. But we weren't holding our breath, and boy were we excited. I literally jumped out of my office chair," Loverin tells The Hollywood Reporter.

After the success of homegrown hits like the Emmy-winning Schitt's Creek and Kim's Convenience on Netflix, the Kanata creators are following an increasingly well-trod path to the international market for Canadian creators. Originally developed at the CBC, Canada's public broadcaster, the what-if drama was pitched as an Indigenous Game of Thrones at the Banff World Media Festival, only to be judged too costly to be financed and produced only out of Canada.

"Most people told us Kanata was too expensive. Pam and I knew that this project needed the backing of someone like Netflix, Amazon Prime or Apple TV+. It needed that kind of money to bring it to full realization," Loverin says. But that hunt for U.S. streaming content boom dollars has also been driven by reduced investment in local series by private Canadian broadcasters as consumers increasingly go online for video and audio content.

In Aug. 2020, private Canadian networks warned the federal government in Ottawa in a report — The Crisis in Canadian Media and the Future of Local Broadcasting — that their traditional business model of buying and airing U.S. TV shows to subsidize local programming "has become much more difficult with the recent rapid growth of Internet-delivered 'over-the-top' (OTT) alternatives."

To offset their risk on local content, Canadian TV networks increasingly urge local indie producers to chase foreign investment for their homegrown projects as domestic license fees drop. Against that market backdrop, the response from Ottawa to throw the Canadian industry a lifeline has been Bill C-10, proposed legislation to raise around $800 million annually from U.S. streamers like Netflix, Spotify and Disney+ as they become obligated to subsidize local Canadian film, TV and music product.

Also known as the Broadcasting Modernization Act, Bill C-10 would amend the federal Broadcasting Act and create a new "online company" category and, for the first time, regulate foreign media players active in the Canadian market. "You'll see our creators rise to the task and level up to the kind of storytelling required. We're kicking ass and an influx of money will be welcomed and also will be profitable for the people investing in it," says film and TV director Warren Sonoda, who is also national president for the Directors Guild of Canada.

Bill C-10 would compel foreign online platforms doing business in Canada to direct a portion of their domestic revenues to help local Canadian creators get more of their product into the world market. Ottawa is putting its hands into the deep pockets of U.S. streamers and other digital players just as they increasingly shoot their movies and TV series on bubble-wrapped film and TV sets in Toronto, Vancouver and Montreal amid the pandemic, which has the Canadian production sector marching at a record production pace.

At the same time, a lack of COVID-19 insurance has kept many Canadian film and TV projects from local producers from starting production until 2021, threatening to leave behind local producers with "Canadian" stories to tell for world audiences.

Bill C-10 supporters see the legislation, should it become law, recharging Canada's indie production sector as Ottawa puts struggling local broadcasters and U.S. streamers on a level playing field. "The key component will be to ensure that foreign digital players must play by the same rules as the domestic Canadian broadcasters, where the content must be owned and produced by Canadian independent producers," Mark Bishop, executive producer and co-CEO of indie producer marblemedia, insists.

But Bill C-10 critics argue that Ottawa, by creating a streaming video and audio tax to subsidize so-called "Canadian content," will treat foreign digital players like local Canadian broadcasters, rather than support diverse and emerging local content creators operating on new media platforms, including YouTube, with user-generated content denied public subsidies.

"That really does a disservice to creators who really do have international audiences and have the potential to do well internationally, to say we're going to build this system that keeps you in it," argues Laura Tribe, executive director for OpenMedia, which works to keep the Internet open, affordable and surveillance-free.

Critics also argue Bill C-10 may have the unintended consequence of reducing, rather than increasing, U.S. streaming investment in locally-made content as legislation to make Canadian content expenditures mandatory slowly winds its way through bureaucratic and regulatory channels in Ottawa.

Michael Geist, professor of law at the University of Ottawa, warns it may be years before foreign online players learn what the new rules on their mandated Canadian content contributions will be. And that may delay original production by U.S. streaming players at expanding production hubs in Toronto and Vancouver.

"Timelines are much longer than the minister [Steven Guilbeault] lets on. The sector is looking for answers in the short term. And some of the large players perhaps will put some productions on hold as they won't know if they count for the regulatory requirements," Geist insists.

But marblemedia's Bishop defends the Canadian government and regulators taking their time to consult with the industry and ensure Bill C-10 reforms are effective. "The future of our industry depends on it," he says.

Meanwhile, Kanata co-creators Loverin and Jones are putting the finishing touches on their upcoming presentation to Netflix programmers. "We hope to represent a story that, as an indigenous storyteller, can prove we can reflect our people successfully and honestly and truthfully, so that when they watch Kanata, they can see themselves in a different light than how they have been portrayed," Loverin explains.