Shaw calls for removal of 5% BDU content contribution

Shaw Communications Inc. is asking the government to drop the five per cent revenue contribution TV service providers make to Canadian content, but says if CanCon needs a subsidy then it should be a direct one from government coffers. Shaw’s submission to the panel reviewing Canada’s communications laws says the current annual contributions broadcast distribution undertakings make should be nixed and if anything, replaced with tax revenue from citizens, so that Canadian content isn’t funded at the “continued expense of BDUs who are facing significant market challenges.” Shaw sold its media division to Corus Entertainment Inc. in 2016, since focusing on its broadcast distribution, internet and wireless service. “Unfortunately, Canadians continue to watch little of the content that is brought into the system through Canada’s elaborate funding architecture,” Shaw’s submission said, arguing that few Canadian entertainment programs receiving public funding make the top 40 prime time lineup in Canada each year. “This financial obligation impairs our ability to deliver programming at affordable rates. Moreover, it undermines our most important cultural contribution to the broadcasting system – the provision of efficient, state-of-the-art networks and associated innovations in the increasingly competitive distribution sector.” Currently, broadcast distribution undertakings (BDUs) have to contribute five per cent of their gross revenues from broadcasting activities each year to fund Canadian programming. Content producers are meanwhile biting their nails over the prospect of the current Canadian Media Fund (CMF) subsidy running out before the panel’s review period is over, warning of a possible industry contraction if that happens. Production groups, unions and others have been pushing for a new, hotly-contested ISP tax to fund Canadian content as broadcast contributions dry up. Many groups and companies, including Rogers Communications Inc., have called for new regulations for over-the-top players like Netflix Inc. to help foot the CanCon bill. Shaw’s submission says the foreign over-the-top (OTT) players, who have gotten a “free ride” from an “asymmetric” regulatory environment, should be forced to collect and remit sales tax -- money which could be “allocated to directly subsidize Canadian content.” It suggests that tax remittance would work out roughly to be a $100 million a year. BCE Inc. has not shared or made public its asks in the communications review consultations. But the more than 2,000 submissions by interested parties are expected to be published by the review panel by the end of June.

Shaw calls for removal of 5% BDU content contribution

Brief | January 22, 2019

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Shaw calls for removal of 5% BDU content contribution

Brief | January 22, 2019

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