Brad Danks | CEO, OUTtv Media Global
Part 8 – CARTT Series: Beyond the Walled Garden
Read – Part 1 | Part 2 | Part 3 | Part 4 | Part 5 | Part 6 | Part 7 | Part 8 | Part 9
The federal government is now the majority funder of the Canada Media Fund. The fund still operates as it has for decades. Canada needs one built for what comes next.
The eight articles in this series (https://cartt.ca/category/beyond-the-walled-garden/) diagnosed the structural problems in Canada’s media system and proposed reforms. The first was a targeted redesign of the CMF broadcaster-trigger model. This article examines what that redesign would require, and asks whether the strategy the Canada Media Fund just published reflects the moment. A companion piece, following shortly, addresses a question this article cannot resolve on its own: who actually has the authority to make these changes, and where that conversation now has to happen.
The Canada Media Fund released its 2026–2029 Strategic Plan this past spring. It is professionally organised, internally coherent, and built around four pillars: Modernize, Mobilize, Maximize, Monetize. Several of its outcomes point in the right direction. It does not engage with a structural shift in the CMF’s funding mechanisms — one documented in its own audited statements.
In 2014–15, BDU contributions (the cable and satellite payments that were the fund’s first engine) accounted for 63.6% of CMF revenues. Federal contributions provided most of the remainder. The co-investment logic was coherent. Industry money, channelled through industry-controlled mechanisms, serviced a shared cultural mandate.
By 2024–25, that picture had inverted. The CMF’s own Future Program Model Working Group reported BDU contributions had fallen to an estimated 37% of CMF funding — down from 63.6% a decade earlier. Federal contributions had moved in the opposite direction, becoming the majority source. The Working Group has also confirmed that BDU declines are projected to continue, and that the fund has already exceeded its government stabilization funding cap. The federal majority is a floor, not a ceiling.
63.6% → 37% BDU share of CMF funding — 2014–15 to 2024–25 (estimated)
$231M → $133M BDU contributions — estimated decline over the same period
Cap exceeded Federal stabilization funding ($42.5M) — surpassed by current need
The CMF has been transparent about this trajectory, noting it in industry consultations and audited statements. The transparency is not in question. What the four-year plan proposes to do about it is.
The first shift is financial. The CMF was designed when BDU contributions made up the majority of its funding and federal capital filled the gap. That ratio has inverted. The CMF is now, in funding terms, a federal program operating inside a broadcaster-triggered architecture designed for a different funding source. The financial composition has changed. The architectural design has not.
The second shift is structural, and it is the more consequential one. Value in the content economy has moved from production toward IP ownership, audience data, distribution infrastructure, and the systems that mediate discovery. Fox Corporation’s recent US$22 billion acquisition of Roku — paid for distribution reach and a measurement-rich consumer entry point rather than for a content library — is a current illustration of a broader and longer-running trend. The CMF’s architecture remains calibrated to the layer where value used to sit. The majority of broadcaster-triggered project funding flows through broadcaster envelopes (approximately $201M of the $362.6M 2026–27 program budget, or roughly 55%) with the remainder allocated through other envelopes, some of which now also require a broadcaster licence commitment. Within those envelopes, domestic linear audience share is the largest single factor in the six-factor allocation formula. The centre of gravity remains broadcaster triggers measured against linear viewing — in a market where value has moved elsewhere.
The four-year plan does not mention artificial intelligence once. That absence is not the central problem — it is a tell. AI is the accelerant on a shift already underway, and a strategy that does not name it cannot be calibrated against it.
Canada has, in effect, nationalised the funding base without nationalising the strategy. Once government becomes the majority funder, the strategy must be designed around long-term system value, not annual disbursement. The question is no longer whether the existing model can be sustained. It is what the public funder builds next.
What the Plan Protects
The CMF’s allocation architecture has three structural features that, taken together, determine what public capital actually purchases. Together they produce a single outcome: public investment whose long-term value accrues to entities outside the Canadian system.
A note on terminology. The argument that follows is about a category of business that does not yet have a settled industry name: Canadian-controlled programming services that own catalogue and reach audiences through their own SVOD, FAST, broadcast, and platform partnerships — operators such as OUTtv, Blue Ant, Gusto, Stingray, Anthem, and others. They are not production companies and not distributors in the BDU sense. Where this article refers to “Canadian-controlled programming services” or “Canadian-controlled media services,” it means this category.
The envelope formula
The envelope system was defensible when BDU contributions financed broadcaster participation, and broadcasters were the dominant co-investors. They earned their allocation authority by putting in the majority of the capital. They no longer do. The architecture has not been recalibrated.
Envelope allocations are calculated against a six-factor formula. The dominant component — Audience Success, Total Hours Tuned, weighted at 35% — is measured against domestic linear viewing. That measurement is rigorous within its own definition.
The CMF has consistently acknowledged that the definition is narrower than the market it is meant to allocate against. Numeris measures the Canadian domestic linear market and continues to improve its reporting systems, including the integration of set-top box return-path data and the national rollout of its cross-platform Video Audience Measurement (VAM) service in October 2025. Streaming consumption now represents close to half of video viewing in Canada. VAM coverage is expanding as streaming service participation is added, but is not yet complete. And it is not built to track Canadian content performance on foreign platforms in foreign markets.
That gap is definitional, not methodological. The CMF named it candidly in its February 2026 Follow the Eyeballs analysis. The four-year plan does not commit to closing it.
What the formula does not measure is what determines the long-term value of public investment in a global content market: IP retained, audience relationships built across windows, content travelling beyond domestic linear viewing, value compounding over time. Public capital is being allocated against criteria the global market no longer rewards. Adding streaming data, demand indices, or platform-level viewership would not close the gap. What’s needed is a redesigned formula, not better inputs.
The foreign-platform substitution
The 2026–2029 plan commits to expanding eligibility to “online streamers and international distributors” as co-triggers of CMF funding. Qualifying non-Canadian streamers can already contribute up to twenty-five percent of the minimum financing threshold in Children and Youth and Documentary programs, and the April 2026 program budget confirmed expansion across genres.
Twenty-five percent is a minority share, but it is not a resting point. It is being expanded genre by genre, with no stated ceiling and no articulated conditions governing what rights those entities receive in exchange.
Foreign platforms contributing to the trigger threshold do so in exchange for rights — international territory exploitation rights, flowing outward. Declining broadcaster trigger authority is being partially replaced by foreign platform trigger authority. Legacy broadcasters, whatever their structural limitations, are Canadian-owned, CRTC-regulated, and accountable to a domestic cultural mandate. Foreign platforms are none of these things. The current framework institutionalises that exchange without weighing what the public investment loses on the long-term value side.
A system majority-financed by Canadian taxpayers is incrementally building foreign platforms into co-gatekeeping authority over Canadian IP — without conditions, without a ceiling, and without acknowledging the structural tension. The plan describes this as modernisation. It is more accurately described as a structural concession — Canadian public capital invested at home, rights and upside accruing elsewhere, indefinitely. A move toward platform-agnostic triggering compounds the problem rather than resolving it. When the identity of the trigger no longer matters, the rights question disappears from view, and Canadian producers are repositioned as resource suppliers to whoever is willing to leverage the public subsidy.
This trajectory is not contained to existing funding. Any new public capital routed through the same trigger architecture inherits the same expansion path. A foreign-platform contribution share with no stated ceiling does not pause for new money; it applies to whatever flows through the mechanism. New federal investment, absorbed into the current trigger model by default, would be subject to the same rights leakage already documented for the funding the system administers today.
The reallocation is already underway, and it points in the wrong direction. The CMF has been increasing funding to Canadian distribution companies, “distributors” in the film industry sense, that deal in rights. Almost none of these operate actual international media businesses. They do not own or operate international SVOD services, FAST channels, linear TV, or similar consumer offerings. Blue Ant is a notable exception. Meanwhile, Canadian-controlled programming services operating internationally through their own owned SVOD, FAST, and broadcast channels have seen envelope allocations shrink in recent cycles, while the trigger expansion directs new authority, and the rights that come with it, to foreign partners. A fund focused on building Canadian companies would identify the services already producing the outcomes the system claims to want: IP retention, export performance, direct audience relationships — and make them the priority. The current plan does the opposite.
Production ownership without downstream rights
The CMF does require Canadian ownership at the production stage. Applicants must be Canadian-controlled companies, and the fund’s guidelines are explicit that IP is intended to remain under Canadian control. That requirement is real.
The critical gap is downstream. Because CMF funding requires a broadcaster licence fee as a trigger, and because broadcasters increasingly co-finance with global streamers, many CMF-supported projects involve rights assignments — often exclusive, often global — flowing to foreign platforms as a condition of getting the project made. A Canadian producer can satisfy every CMF ownership requirement and still transfer the long-term value of their IP to a foreign rights holder through a perfectly legal financing arrangement the CMF neither monitors nor conditions.
Ownership on paper is not retention in practice. The “Monetize” pillar references diversified revenue sources and increased return on investment, but these are financial outcomes, not structural ownership outcomes. There is no commitment to governing downstream rights, no linkage between public funding and long-term Canadian participation in the value that funding creates.
The pattern
Three mechanisms, one outcome. An envelope formula calibrated to a domestic linear market that is on track to become a minority of viewing within the plan’s four-year window. A trigger pathway expanding to entities for whom rights ownership is the point of participation. An ownership requirement that protects the production phase, not the distribution phase that determines audience, revenue, and long-term value. Each is defensible in isolation. Together they describe an architecture that has crossed from co-investment to public funding without being redesigned for what public funding now has to do. The current design is accelerating Canada toward a permanent supplier role for foreign platforms instead of building its own.
The predictable objection is that Canada lacks the scale to compete with global platforms, and that production financing therefore remains the rational policy focus. The objection misreads the opportunity. Canadian-controlled programming services succeeding at the edges of the system are not trying to outscale Netflix. They are operating in the layer where scale matters less and specialisation matters more, retaining IP and building direct audience relationships without the structural support the system provides to the incumbents.
A second objection runs in the opposite direction: that a redesign oriented around IP ownership and direct distribution is a strategy for export-focused services, and leaves the Canadian services that primarily serve Canadian audiences out of the frame. It does the opposite. The capacity to commission, retain rights, and build audience relationships is the same capability whether the audience is domestic or international — and for most Canadian-controlled services it is the domestic audience relationship that finances everything else. The countries that have built durable export capability have done so on the strength of their domestic institutions, not at their expense. A system that hollows out the services Canadian audiences actually watch will not produce companies capable of competing anywhere else either.
What gets encouraged by policy gets done. What gets penalised gets done in spite of policy, by a small number of operators willing to absorb the friction. The redesign is not a leap of faith. It is a decision to support what is already working.
What Recommendation 1 of This Series Would Require
The first recommendation of this series proposed reform of the CMF broadcaster-trigger model around two streams: public interest services — those carrying mandatory distribution, must-offer status, or distinct mandates serving Indigenous, official-language minority, accessibility, parliamentary, or diversity audiences — and commercial services investing in audience growth, IP retention, export performance, and direct distribution capability. The reweighting operates within the system’s existing cultural obligations, not against them. Regional production, French-language programming, and educational and third-language programming are not casualties of redesign but core objectives to meet.
Operationalising that recommendation against the CMF’s current architecture requires five concrete commitments, each tied to a mechanism the four-year plan addresses or omits.
One — Shift the allocation logic from inputs to outcomes
Public investment should be tied to IP ownership, export performance, and long-term value creation, not production volume. It requires building the data and measurement infrastructure to make those outcomes visible: audience data, first-party relationships, and metadata that convert content activity into measurable value.
An accountability mechanism would convert principle into practice: a defined percentage of CMF-supported projects required to demonstrate measurable export activity or retained rights within a defined window of completion. What the threshold should be is a policy choice. Whether there is one is not.
Two — Fund distribution infrastructure as core cultural policy
Canada already finances content creation at scale. It does not invest in the distribution capability of Canadian-controlled programming services: the SVOD platforms, FAST channels, and direct-to-audience infrastructure through which Canadian IP reaches viewers and generates return.
The ability to reach global audiences directly through owned SVOD and FAST channels, platform partnerships, and direct audience relationships is not a commercial luxury. It is the mechanism through which publicly funded Canadian IP generates return rather than leaking value to foreign platforms.
This is also where the funding question and the definitional question converge. “Distribution” in Canadian policy has long meant two very different things, and the conflation has cost the system. International sales agents who license rights territory by territory are a real and legitimate business. So are consumer-facing services that own a continuing audience relationship. They are not the same activity, and they do not generate the same kind of value. A rights sale captures value once, for a single title, in a single transaction. An audience business captures value repeatedly: it learns from every interaction, compounds its catalogue and recommendation capability, and builds advertiser and subscriber economics that strengthen over time. Funding the second is what a Canadian distribution-capacity strategy needs. Funding more of the first, dressed up as modernisation, is what the current trigger expansion risks doing instead.
Three — Extend IP policy beyond production
Production ownership without downstream rights retention is the leakage point identified earlier. Closing it requires the CMF to govern what happens to rights at the financing stage, not only at the certification stage.
At minimum: no CMF-supported project should be eligible for funding where the financing structure requires assignment of international exploitation rights to a non-Canadian entity as a condition of greenlight without a corresponding equity participation, revenue-sharing mechanism, or rights-reversion structure that keeps long-term value within the Canadian system.
Four — Back companies, not just projects
Without stable domestic revenue and distribution, Canadian-controlled programming services cannot retain IP, finance slates, or build export businesses. A redesigned system must support company-level growth alongside individual productions, and concentrate that support where Canada has demonstrated structural advantage: the categories where Canadian content can compete globally and repeatedly.
The CMF already has company-focused programs in its toolkit. The question is whether they are resourced at a scale commensurate with the problem, and whether their eligibility criteria reward IP retention, export performance, and direct distribution capability. A dedicated slate-financing or company-development stream with eligibility criteria tied to those outcomes would be a concrete first step.
Production-for-hire generates wages and stops there. Company-level investment generates wages, reinvestment capital, and the durable enterprise value that compounds into national competitive advantage. If the companies that public money supports are producers and rights distributors who then licence content to non-Canadian streamers, the compounding value of Canadian IP will flow to those foreign platforms. If public capital supports Canadian-controlled media services that own catalogue and reach audiences directly, that value returns to Canada.
As production economics change underneath the system, the gap between the two widens. A funding architecture that allocates against production volume without requiring company-level outcomes will continue to produce employment without producing wealth. It finances the wages of a creative industry without building one.
Across the major consulting, banking, and media-research firms, the same diagnosis now appears. McKinsey, BCG, Deloitte, PwC, and Accenture identify an AI-driven expansion in content supply and a corresponding migration of value toward distribution systems, data infrastructure, and IP ownership. Capital markets analysts track the shift in equity performance: markets are rewarding audience aggregation, advertising infrastructure, and platform control, not production volume. Ampere Analysis and Omdia show the consequence – growth concentrated in AVOD, FAST, connected TV, and globally aggregated niche audiences. The diagnosis is not contested at the analytical level. What remains contested is whether Canadian public capital will be deployed against it.
The Canadian data underwrites the structural point. CMPA’s Profile 2025 reports $10.17 billion in Canadian film and television production in 2024/25, of which $5.32 billion (over half) was foreign location and service production, where copyright is held by non-Canadian producers. The distinction matters: production activity measures spending, employment, and supplier networks. Appropriation measures who owns the rights, controls renewal, earns the royalty, and commands the margin. Canadian public capital has been better at financing activity than at building appropriation. CIPO research finds that Canadian SMEs with formal IP receive average approved debt financing of $757,000, which is three times the $245,000 approved for firms without. Ownership is not only a cultural-policy outcome. It is a balance-sheet outcome.
The two-stream model this series proposes is not a trade-off between export ambition and domestic public interest. The two are the same architecture viewed from different angles. Must-carry services, official-language minority broadcasters, Indigenous media, regional and diversity-mandated services, and the broader range of Canadian-controlled programming services serving Canadian audiences are not casualties of redesign. They are its foundation. Domestic carriage, domestic subscriber revenue, and domestic audience relationships are what finance commissioning, IP retention, and the distribution capability the redesign is meant to build. Export capacity is a downstream outcome of domestic strength, not an alternative to it. A system that builds Canadian IP ownership and export capability while hollowing out the infrastructure that serves Canadian audiences has not modernised. It has redirected the same structural failure toward a different set of communities. The redesign works only if both streams are treated as non-negotiable — and if the policy architecture is honest that serving them well requires different instruments, different metrics, and different accountability mechanisms than a single production-volume envelope can provide.
Five — Name the transition
A system redesigned around ownership, distribution, and outcomes will reallocate envelope authority and the criteria by which producers access public capital. Some incumbents will receive less. Some new entrants will receive more. Some programs will end. A credible strategy names that reallocation explicitly and with a defined timeline for envelope reform and criteria for measuring whether the transition is working.
This is the requirement most absent from the current plan. The strategic language — stronger Canadian companies, diversified revenue, market-driven pathways — points in the direction this series recommends. What it does not do is name the structural reforms that would produce those outcomes, or the reallocation those reforms would require. Reform language without reallocation specifics is not a strategic choice. It is a description of a process whose only purpose is to avoid making one.
The same absence has a forward-looking consequence. Any new federal funding directed at the sector — whether through an expanded mandate, a new fund, or additional contributions — will, absent a stated alternative, be integrated through the only mechanism the CMF currently operates: the existing envelope architecture. A fund that has not specified how it would reallocate what it already administers offers no basis for confidence about how it would absorb more. The default is not neutral. It is the architecture this article has described.
Canada has built a strong production system. The next question is whether the companies that production system finances are also the ones positioned to retain the IP, own the audience relationship, and capture the long-term value that production creates. The four-year plan does not yet answer that question. The next article in this series turns to who actually has the authority to make it answer.
Canadians deserve a strategy for the future, not a defence of the past.
Brad Danks is CEO of OUTtv Media Global and an Adjunct Professor of Law at the University of Victoria. He is a frequent writer and speaker on the evolving media landscape. He represents OUTtv’s interests as a member of industry groups, including Beyond Mainstream – a global alliance of independent streaming companies advancing innovation and competition in digital media, and Streaming for Australia. Brad also sits on Numeris’ Board and is a faculty advisor at the Center for Digital Media in Vancouver.
HIGH QUALITY JOURNALISM REQUIRES AN INVESTMENT.
Cartt.ca publishes breaking news, in-depth feature stories, analysis, and opinion geared specifically for those working in the cable, radio, television, and telecom industries in Canada.
Breaking news, top-notch analysis and commentary is posted as it happens while twice-weekly newsletters compile those stories and deliver them directly to more than 4,000 industry subscribers. Cartt.ca offers credible journalism for the industry professional.
