The Government of Canada has directed the Canadian Radio-television and Telecommunications Commission (CRTC) to review its decision requiring large audiovisual streaming services to devote 15% of their domestic revenue to Canadian content.
It will invest CAD $600 million (approx USD $432m) per year in the country’s audio and audiovisual sectors instead.
The measures were announced on Wednesday (June 3) by Marc Miller, Canada’s Minister of Canadian Identity and Culture and Minister responsible for Official Languages.
The CRTC‘s new requirements “would impose new costs on the companies providing these services, which could ultimately fall on Canadian consumers through higher prices,” the government said.
The federal money is intended to provide stability and support to the sectors while the government develops new policy directions for the Online Streaming Act.
That 2023 law expanded the CRTC‘s authority to include online content.
“We are investing to support the audiovisual and audio sectors now, while bringing necessary stability as we develop new directions that will ensure Canadian content remains affordable.”
Marc Miller, Canadian Government
“Canadians should be able to see themselves in the films and series they watch and hear their lives reflected in the artists they listen to,” said Miller.
“That’s why we are investing to support the audiovisual and audio sectors now, while bringing necessary stability as we develop new directions that will ensure Canadian content remains affordable and that our stories continue to shape our identity and how the world sees us.”
On May 21, the CRTCtripled the levy that large audiovisual streaming platforms operating in Canada must pay – from 5% to 15% of their Canadian revenues.
The 15% rate formally applies to audiovisual services such as Netflix, Disney+, and Amazon Prime Video with annual Canadian broadcasting revenues above $25 million.
The CRTC has said the combined contributions from broadcasters and streamers are expected to stabilize funding at more than $2 billion a year for Canadian and Indigenous content.
“Today’s decisions are about building a stronger broadcasting system,” said Vicky Eatrides, Chairperson and Chief Executive Officer of the CRTC, in a statement following the May ruling.
The CRTC‘s framework has been opposed by the streaming companies it covers.
The Digital Media Association (DiMA), the trade body for music streaming services including Spotify, Apple, and Amazon Music, welcomed the government’s latest announcement.
“The Digital Media Association supports today’s announcement by the Government of Canada,” said Graham Davies, DiMA’s President and CEO, in a statement.
“We hope Minister Miller‘s forthcoming directive will be a crucial and welcome step towards ensuring Canadians retain access to affordable music streaming services, while still providing robust support for Canadian artists and culture.”
Graham Davies, DiMA
“We hope Minister Miller‘s forthcoming directive will be a crucial and welcome step towards ensuring Canadians retain access to affordable music streaming services, while still providing robust support for Canadian artists and culture.”
“Music streaming services have transformed how Canadians discover and enjoy music while helping Canadian artists reach audiences here at home and around the world,” Davies added.
“We are encouraged by the government’s clear recognition that championing Canadian culture must go hand-in-hand with protecting affordability, innovation, and consumer choice.”
“By directing the CRTC to review its framework and stepping up with federal investments for the cultural sector, the government has shown a commendable willingness to listen to the concerns of the digital industry, creators, and everyday consumers.”
Spotify has said the 15% rate does not currently apply to its service, which it classifies as an audio streaming platform rather than an audiovisual one.
Spotify now hosts music videos and video podcasts, raising the question of when a music service begins to function as a video platform under the regulator’s definitions.
The question of where audio-only music services fit within Canada’s framework remains unresolved, with the CRTC‘s audio policy process still ongoing.
Spotify, Apple, and Amazon are already contesting the CRTC’s original 5% levy, first imposed in 2024, the enforcement of which a Canadian federal court has paused pending the outcome of an appeal.
That levy was designed to channel money into funds supporting Canadian content creators, including FACTOR, its French-language counterpart Musicaction, and the Indigenous Music Office.
The government said the additional investment will ensure Canadian creators, producers, and broadcasters receive the support they would otherwise have gained from the CRTC‘s decisions. Further details will follow after consultation with the sector.
Once the new CRTC rules are finalized, the level of government investment will be adjusted accordingly.Music Business Worldwide
