TORONTO – Regulators must help to save Canadian voices from extinction as television evolves in a new digital world, says a new report from the C.D Howe Institute.
In Strengthening Canadian Television Content: Creation, Discovery and Export in a Digital World, authors Lawson Hunter, Kenneth Engelhart and Peter Miller find the future of television and Canadian content is up in the air in a world where TV is delivered over the Internet, bypassing Canadian regulations.
Internet-delivered TV’s increasing popularity could lead to a significant decline in the amount of available Canadian television content, at least in the regulated system, says the report. In addition, if Canadian broadcasters and cable companies are regulated, and Internet- delivered competitors like Netflix are not, it will be difficult for Canadian providers to compete or even to survive, especially if foreign competitors face no Canadian tax.
The authors recommend several changes to regulatory rules to address the challenges ahead including:
– Foreign digital services should be subject to GST/HST;
– A number of CRTC and Canada Media Fund rules and restrictions inhibit export, particularly of Canadian drama. These rules should be relaxed;
– As revenues decline in the broadcasting system, the subsidy mechanisms, such as the Canada Media Fund, will need to be topped up with additional funding. Rather than requiring a subsidy from Internet service providers, a better idea is to use some of the proceeds from the auction of 600 MHz wireless spectrum to subsidize declines in the Canada Media Fund; and
– The government should conduct a periodic review, perhaps every five years, by a group outside of the CRTC that could determine the health and necessary reforms of the broadcasting system and its ability to support Canadian content.
The C.D. Howe Institute is an independent not-for-profit research institute whose mission is to raise living standards by fostering economically sound public policies.
