OTTAWA – NBCUniversal will head to Parliament Hill to lobby on favourable tax measures for the company that has created content in the country, as it prepares to push new products in the new year.
It’s the first time the mega media company out of New York (and of course owned by Comcast Corp.) has registered to lobby the feds after having done so with Alberta and Ontario this past fall. The federal registration, effective January 6, targets Canadian Heritage and seeks to “monitor” and “assist” in the “development of policies that encourage and not hamper the development of film and television production in Ontario.”
It’s unclear why the company is lobbying the federal government on policies in Ontario. Registered lobbyist for NBCUniversal, Carys Baker of Maple Leaf Strategies in Toronto, did not return numerous phone calls and emails about what this registration means. The principal representative on the file for NBC, Brian O’Leary – listed as senior vice president for the company – did not respond to an emailed request for more information on the registration.
The company has registered to lobby Alberta to “promote changes to the tax treatment of film and television production that is competitive with other jurisdictions,” while in Ontario, it has registered to “encourage the development of film and television production.”
Both provinces either have, or are contemplating, what form of incentive it can implement to attract film or TV productions. Ontario already has a tax credit initiative, known as the Ontario Production Services Tax Credit, while the newly-elected United Conservative Party in Alberta has previously promised to convert grants already doled out into tax credits to make it more in-line and competitive with other provinces, including British Columbia.
However, a report by the Calgary Herald late last year noted the drop in how much productions can claim as tax deductible will mean the credits will not make the province competitive versus the rest of the country.
NBCUniversal is no stranger to Canada: its popular show Suits was shot in Toronto – which, according to the Motion Picture Association of Canada, generated over 2,300 jobs in Ontario on over $100 million spending – it has partnered with Canadian productions, and it has opened its reality TV streaming service Hayu to Canadians. The company now plans to launch in April 2020 a new streaming service called Peacock (after its mascot icon), but it’s currently unclear if that will be made available in Canada.
On Wednesday, Telus announced that Hayu now has its own app on its OTT platform Optik TV.
Last year, CBS established a production studio in the Toronto suburb of Mississauga. It was an illustration that foreign media companies weren’t just going to take eyeballs away from Canadian productions by flooding the country with made-in-the-USA streaming services like Netflix and Amazon Video; it was also going to produce content in the country, likely hiring Canadian actors.
When Canadian Heritage, under Melanie Joly, struck a five-year, $500-million deal with Netflix to create content in Canada in 2017, critics panned it as the wrong move (or that Joly could have extracted a far larger commitment). They said the government needs to regulate the foreign companies by bringing them in line with Canadian regulations – either have them contribute to Canadian content thresholds or make them pay in some other way. Such was the conclusion of the CRTC’s 2018 Harnessing Change report, which recommended the government require entities benefiting from the Canadian industry to contribute in an “equitable” way to the system, including foreign players.
Some criticized the Netflix deal in another way: it didn’t ensure that content produced in Canada was actually “Canadian content.” Netflix, as part of its move to change how it reports its earnings figures, reported that by the end of its most recent third-quarter, it had about 6.5 million Canadian subscribers and generated about $780 million from the country since the start of 2019.
Other groups lobbying on tax-related issues include the Alliance of Canadian Cinema, Television and Radio Artists (ACTRA) in Alberta, Quebecor in Quebec, Entertainment One in Ontario, and the Writers Guild of Canada, which on Wednesday renewed its federal lobby files to include discussions about “audio-visual tax credits.”
