NETFLIX BONANZA MEANS A RETURN TO THE DEBATE OVER CAN-CON

In the era of Netflix, how do we determine what we want Canadian Content to be?

IS NETFLIX’S CANADIAN “INVESTMENT” IN LIEU OF PAYING TAXES?

Over the past few weeks, a certain speech has been arousing a great deal of discussion. It was delivered by Melanie Joly, Minister of Canadian Heritage, to the Economic Club of Canada, and it describes what Joly calls “our Government’s vision for a Creative Canada” – those ceremonial capital letters heralding a branded national plan.

Creative Canada is not a piece of policy or legislation. Rather, it “sets the policy direction for our programs, legislation and Portfolio agencies for the coming years,” and “includes new initiatives and new funding to get us there.” To many observers, its meaning is clear: it is a scheme to appease Netflix and other foreign superpowers in the digital sphere, or, perhaps, a plot to surrender to outsiders our cultural sovereignty. Joly has been accused of “signing blank cheques for American multinationals” and of “giving away the keys the kingdom.”

Throughout such denunciations, Joly has maintained that Creative Canada is actually a boon to the country’s cultural initiatives, and a victory over outside interference. The linchpin of the plan is an agreement with Netflix, under which the streaming service and content producer will invest “at least CAD $500 million over the next five years in original productions in Canada that will be distributed across Netflix’s global platform” – a deal Joly insists represents “a meaningful partnership in supporting Canadian creators, producers and Canadian creative work.”

But the critics remain unpersuaded, and this specific arrangement seems to have concentrated their wrath. Conspiracy theories abound: is this $500 million merely a settlement in lieu of paying taxes? Isn’t it curious that Netflix just so happened to raise monthly subscription fees by a dollar?

Creative Canada has already occasioned vitriol from politicians and pundits nationwide. David Sparrow, president of the Alliance of Canadian Cinema, Television and Radio Artists, questioned why it seems we’re “allowing foreign multinational companies to basically set their own rules when we already have regulations in place for our broadcasters.” Quebec Minister of Culture Luc Fortin described the deal as “Netflix paying itself $500 million to produce content that it will sell for a profit.” The Globe and Mail’s Kate Taylor declared it “an abject failure” that was “merely political cover for Joly as she fails to resolve the central issue her review was supposed to address: how to update analog-era supports for Canadian creators so that they can thrive in the digital age.” Last week, Rudy Buttignol, president and C.E.O. of British Columbia’s educational cable channel Knowledge Network, objected to the freedom Netflix will enjoy in choosing which Canadian projects to finance. It’s critical, he said, that funding for productions in this country to be allocated for “projects that are in the national interest.”

The day after the announcement of Creative Canada and the details of the Netflix accord were released, Joly was obliged to address another line of criticism, this one emerging from her home province of Quebec, where response to the the plan, according to the National Post’s own Montrealbased correspondent Graeme Hamilton, has been “overwhelming negative.” Detractors there complain that the government’s arrangement with Netflix offers no specific commitment to French-language content.

“I think the federal government needs to do its homework,” balked Minister Fortin, “and insist on a proportion original Francophone content in the $500 million.” Hélène Messier, president of the Association Québécoise de la Production Médiatique, was alarmed that Joly would turn to Netflix for this kind of stimulus at all: “I think what has shocked people,” she said, “is the impression that the salvation of the funding of Canadian culture lies in this type of agreement with American giants.”

“There’s anxiety about whether Quebec will be able to get a piece of the $500 million,” Joly conceded in response to these and other broadsides. “I know Netflix will have good news to announce on that subject.” So far they have not; Quebec’s National Assembly, meanwhile, swiftly passed a motion requiring all web companies to collect provincial sales tax, aiming to amend for itself the problems it’s identified with Joly’s deal. “I find it very odd that the federal government would exempt one company from a tax that all companies should collect,” Finance Minister Carlos Leitao explained. Windfall investment or no windfall investment, he and other politicians feel, Netflix ought to be taxed.

It’s true that the tenor of the Creative Canada speech – if not its tactically vague language – suggests a classic quid pro quo: Netflix tenders a lump-sum payment toward “Canadian Content,” and in return for its generosity can forgo the collection of GST. And there are some very real factors that seem to distinguish Netflix under this agreement from, say, a television network, a production studio or a public broadcaster – each of which it has some claim now to be.

Netflix will continue to operate outside the purview of the Canadian Radio-television and Telecommunications Commission. Netflix needn’t contribute to the Canada Media Fund, which receives a portion of revenues from broadcasters and redirects that money back into new productions. Netflix has no obligation to create content in or for Quebec, or indeed, to create content of any particular kind; not one dollar of that $500 million investment, for instance, has been earmarked for indigenous filmmakers. As of this writing, neither Netflix nor Joly has clarified what exactly “Canadian creative productions” in this context even means.

For critics of Joly’s plan, this last point has been an especially urgent matter. Without the guidance of a watchdog committee such as the CRTC, how will Netflix be held accountable for the constitution of its new suite of domestic productions? Can we be sure that Canadians will occupy key creative roles, writing and directing shows and movies rather than simply offering technical labour behind the scenes? As it stands there are no assurances that Netflix will produce in Canada “any content that reflects our identity and our history,” says MP Pierre Nantel.

We could wind up with nothing more than $500 million in what the industry deems “service productions”: films and TV shows made largely by Canadian hands, but conceived,