Music streamers Spotify, Apple and Amazon, as well as radio broadcasters Rogers, Bell and Corus, filed submissions ahead of the CRTC hearing.Jenny Kane/The Associated Press
The federal broadcast regulator begins a hearing today to look at which Canadian content obligations should apply to music streamers like Spotify.
Streaming services argue their current efforts to promote Canadian culture – and the royalties they pay – are good enough. Radio broadcasters, meanwhile, say their sector is in serious decline and they want the CRTC to take a lighter regulatory touch for traditional players.
Both sides are set to make their arguments during five days of hearings in Gatineau, Que., between now and Sept. 29.
The hearings are part of a series of CRTC proceedings to implement the Online Streaming Act, legislation that updated broadcasting laws to capture online platforms.
The federal government is under heavy pressure from the United States to scrap the legislation. Some streaming companies have launched a court challenge of an earlier decision requiring them to make financial contributions to Canadian content and news.
Trump’s film tariff threat resurrects row over treatment of U.S. platforms in Online Streaming Act
In 2024, the CRTC ordered large foreign streamers to pay five per cent of annual Canadian revenues to funds devoted to producing Canadian content, including local TV news. Those payments are now on hold while the Federal Court of Appeal decides on the case.
CRTC regulations state that at least 35 per cent of popular music selections on commercial radio stations have to be Canadian content. The CRTC isn’t looking to extend that standard to music streaming services.
In its notice of consultation on the hearing that begins today, the CRTC said it believes that “contributions similar to content requirements on Canadian musical selections would not be suitable for most online undertakings, including on-demand streaming services.”
It also said its preliminary view is that those streamers should “contribute to the discoverability of Canadian, French-language and Indigenous musiceither through financial contributions or through initiatives targeting the promotion and exposure of these songs to their users.”
In a written submission filed ahead of the hearing, streaming industry group Digital Media Association said music streaming services “have created tremendous value for the Canadian music industry and its artists following years of decline and loss to piracy.”
Music streamers pay approximately 70 per cent of their revenues to music rightsholders in royalties, it said.
“Streaming services effectively pay 8.5 times more of their revenues directly to music rightsholders than the commercial radio sector does, and pay more overall, even taking into account commercial radio’s total Canadian Content Development … contributions,” the association’s submission added.
The Digital Media Association acknowledged royalty payments didn’t count as contributions before the Online Streaming Act; however, it said the “much higher level of royalties paid by music streaming services to the music industry was a central component of how both sides successfully moved the system from ’piracy’ to ’paid.’”
It said it’s “imperative” that the CRTC not apply any quotas or content obligations on streamers.
In its own submission, Spotify SPOT-N told the CRTC music services “are already making an outsized financial contribution to the Canadian music sector. Given this, it would be inappropriate to impose additional financial or regulatory burdens on them.”
Apple AAPL-Q said that, given the measures it and other music streaming services take “to make Canadian and Indigenous content available and discoverable, as well as to promote it,” it would be unnecessary and counterproductive to put in place new regulations.
Amazon AMZN-Q warned that any regulatory intervention that ignores existing efforts to promote Canadian and Indigenous artists would be “inequitable and might cause streaming services to reduce their already significant investments to offset the cost of any new requirements.”
Radio broadcasters, meanwhile, argued in their submission that if the CRTC won’t impose content regulations on streaming services, it should reconsider how it applies them to traditional players.
The Canadian Association of Broadcasters painted a picture of a sector facing “massive declines.”
“It is indisputable that the radio industry is in decline – largely due to the rise of foreign platforms and their disruption of audiences and thus advertising revenue,” the industry group said. It noted private radio’s share of the advertising market has dropped from 13 per cent a decade ago to 5.5 per cent.
It called the current situation “unsustainable” and pointed the finger at what it called unrealistic “Canadian music exhibition levels, overzealous performance evaluations, the possibility of increased spending requirements, and the prospect of additional obligations.”
The Canadian Association of Broadcasters said that a 10 per cent Canadian content requirement would be a more “natural” level but suggested the CRTC decrease the requirement to 25 per cent.
Broadcasters “struggle to understand how the Commission can propose no content obligations whatsoever for the growing part of the audio sector, while declining Canadian radio stations face the prospect of even more restrictive quotas governing what music they can play,” the association told the CRTC.
Rogers RCI-B-T said the CRTC seems to acknowledge that “outdated and prescriptive regulations” would harm the business and programming models of foreign online streamers – but still “appears to ignore the negative impact that these regulations are having on Canada’s traditional radio broadcasters.”
Bell BCE-T noted in its submission that while music streaming services were fringe players when they launched more than a decade ago, they have grown swiftly and accounted for 46 per cent of weekly listening among Canadian adults in 2023, with radio dropping down to 54 per cent.
Corus CJR-B-T told the CRTC the regulator “seriously underestimates the scale of difficulty facing commercial operators” who are facing an “existential crisis.”
