Netflix and Hulu Are Descending on Canada (and Ontario Producers Couldn’t Be Happier)

Streamers illo TIFF - H 2018
Illustration by Mariah Llanes

With the streaming giants setting up shop in the Canadian province, insiders say the deep-pocketed behemoths offer nothing but upside to local producers: "The American over-the-top companies are just getting started; let the feeding frenzy begin"

Canadian novelist Margaret Atwood has become a one-woman cottage industry on the small screen thanks to the binge-worthy success of Hulu and MGM TV’s adaptation of her dystopian novel The Handmaid’s Tale, first published in 1985.

At Netflix, Alias Grace was the third Atwood novel to be adapted for television in 2017, following the premiere of the author’s Wandering Wenda on the Canadian Broadcasting Corp.

Aside from Atwood, a native of Ottawa, the recent TV adaptations have another thing in common: All are a product of thriving production hubs throughout Ontario.

Local producer Karen Shaw of Quarterlife Crisis Productions hopes to capitalize on this trend when she pitches her movie adaptation of Atwood’s first novel, The Edible Woman, to financiers during the Toronto International Film Festival. “We’re fortunate people want to be in the Margaret Atwood business right now,” Shaw says.

Shaw, though, knows that a successful pitch at TIFF’s International Financing Forum will require more than simply attaching Atwood’s name to the project. Her literary movie adaptation needs an international co-production partner, likely from Britain or Germany, for greater production quality and worldwide performance.

That’s where development coin and tax credits from the Ontario Media Development Corp. — recently renamed Ontario Creates — opens up the global possibilities.

“We’re lucky that this project has been helped by the CBC, the OMDC and other local funders to get the script to a place where we can shop it around as a project with global themes,” Shaw says.

Provincial agencies like Ontario Creates have been aggressively supporting local producers and content creators in an effort to bolster the region’s allure to overseas collaborators. After years of success in film and broadcast TV, these agencies are now succeeding with what’s now perhaps the biggest fish of all: the streaming giants.

So far so good, as Netflix, Amazon and other U.S. streamers increasingly make Ontario their latest home away from home.

And as the streamers join other American players weighing the incentives, soundstages and local crews on offer in Ontario, the province’s 21.5 percent all-spend film and TV tax credit has proved to be a huge draw.

“[U.S. streamers] like it here, and so they are sending more business up to us, putting more pressure on capacity,” explains Jim Mirkopoulos, a vp at Cinespace Film Studios, the home for studio work on The Handmaid’s Tale that is now building more soundstages as part of the Titans Studios facility on Kipling Avenue in Toronto.

Across the local production sector, U.S. streamers are locking up studio space, talent and crews for bigger and evermore elaborate sets.

“As we developed and filmed The Handmaid’s Tale,” says Hulu vp content development Beatrice Springborn, “the backdrops were equally as important as the characters and storylines that audiences have connected with so much over the two seasons of this show.... The support of the Ontario film community played an integral role in the show’s success, and we look forward to continuing our relationship with them on more projects in the future.”

Paul Bronfman, chairman and CEO of studio and production equipment supplier William F. White and chairman of Pinewood Toronto Studios, says U.S. streamers are transforming Ontario’s production infrastructure, which had long been kept busy by the major studios.

“The American over-the-top companies are just getting started. Let the feeding frenzy begin,” says Bronfman. “Our company is ready to service all of them.”

Local producers say the increased presence of deep-pocketed streamers has a trickle-down effect, fostering opportunities for local talent to create original content that might not otherwise exist.

“They’re content hungry,” says Kathryn Emslie, chief programs officer at Norman Jewison’s Canadian Film Centre. “That bodes well for the content creators in this country.”

After all, with Hollywood’s battle for content ownership from top creators driving up the prices for content, the streamers are taking a page out of the major studios’ playbook by producing or acquiring product in Ontario as competitive tax credits and a cheap Canadian dollar drastically lower budget costs.

Yet another CBC and Netflix drama, Northern Rescue, starring William Baldwin and Kathleen Robertson, is shooting this summer in Parry Sound, Ontario, while Hulu recently acquired the Canadian comedy Letterkenny, which stars Jay Baruchel and is shot in Sudbury, Ontario.

A global-facing Ontario industry has in effect created two complementary production strands that leverage each other’s strengths: regional clusters across the province for local filmmakers working with international co-production partners on movies for export, and a central production hub for Hollywood in and around Toronto.

That’s where agencies like Ontario Creates play a pivotal role: They promote the region to international behemoths like Hulu and Netflix while leveraging their influence to help local indie filmmakers secure the all-important co-production financing they need to complete their projects. “It’s important to have a provincial agency [like Ontario Creates] on your side, one that understands the reality of what it takes to make an indie film for the global marketplace,” says Damon D'Oliveira, an executive producer with Toronto-based Filmshow.

D'Oliveira co-produced The Grizzlies, an Arctic-shot drama about an Inuit lacrosse team that was co-written by Moira Walley-Beckett and Graham Yost (The Americans, Justified). It will debut Thursday in Toronto at the Winter Garden Theatre.

“We support our producers to get to international markets, we help introduce them to potential financiers and potential production partners within the province and elsewhere in the world, and we support them with export funding so they can travel to make those pitches and make those sales,” says Karen Thorne-Stone, president and CEO of Ontario Creates. “Those international partnerships are key to making sure Ontario films reach the broadest possible audiences and ultimately return on the investment Ontario Creates makes,” she adds.

A timely example is Ontario director Jeff Chan parlaying his 2016 sci-fi short film Code 8 into an expanded feature that crowdfunded $1.7 million on Indiegogo for financing before being shot in Toronto. XYZ Films eventually picked up international sales rights.

Despite Hollywood interest, Chan decided against shooting Code 8 stateside simply because he came to the conclusion he didn’t need to — he had all the talent the project required at home in Ontario. “It’s so important for people working on Code 8 that the film be seen around the world,” he says. “I know Ontario has the talent. Our service is as good as anywhere. And I want our films to be on the world stage.”

And while local producers depend heavily on public subsidies and tax breaks, private investors also are backing indie projects as never before, attracted by the prospect of celebrity-driven festival premieres.

“They’re all Canadian,” says Patricia Rozema of her private equity investors in her film Mouthpiece, which she is writing, directing and producing. Her follow-up to the 2015 Ellen Page-starrer Into the Forest, Mouthpiece debuted Sept. 6 at TIFF.

Meanwhile, as Amazon, Apple and Google’s YouTube follow Netflix and Hulu in scouting north-of-the-border sites for their next production hub, Bronfman sees the Ontario industry being transformed. “These guys are reinventing the industry in terms of how production is planned. I’ve never seen a U.S. producer contract five years ahead for any production hub,” he says, referring to Netflix’s commitment to invest CAN $500 million ($400 million) in Canadian film and TV production over five years.

“And CBS and Disney are going online. They will need content for a few years,” Bronfman adds. While he sees streamer interest as an overall positive in terms of Ontario’s location sector, he notes the real upside is how their presence can directly benefit local content creators. “The Americans are great, but we have to have successful Canadian producers, because that’s our heart and soul,” he says. “I’m Canadian. I want to see Canadian stories told. I want to see Canadian production crews busy.”

This story first appeared in The Hollywood Reporter's Sept. 7 daily issue at the Toronto Film Festival.