Music streamers protest radio subsidies under new Canadian law

Music Canada and the Digital Media Association have expressed strong opposition to new Canadian regulations that require streaming services to financially support local radio.

The new law, passed in 2023, requires non-Canadian-owned streaming services with annual revenues exceeding C$25 million to devote 5% of their Canadian revenues to subsidize Canadian content. This includes 1.5% to support local radio stations.

Music Canada represents labels such as Sony Music Entertainment Canada, Universal Music Canada and Warner Music Canada. DiMA includes streamers Amazon Music, Apple Music and Spotify. In a letter to the Canadian Radio-television and Telecommunications Commission, the groups argued that audio streaming should not be bundled with OTA radio, stating: “Radio and audio streaming are not the same thing.”

Streaming companies argue that requiring them to subsidize radio stations – which they consider competitors – is unfair.

In their letter, Music Canada and DiMA emphasized that streaming, unlike traditional local radio, is not limited by geography, language or broadcast space. They argue that streaming platforms offer Canadian artists, including women and racially diverse musicians, greater opportunities to reach audiences around the world.

In July, Amazon, Apple and Spotify filed a legal challenge against the Internet Streaming Act because it is also causing consternation among video streamers. Netflix and several Hollywood studios have taken similar actions.

The letter ends with: “We ask that as we implement the Internet Streaming Act, we ask that we think of streaming services and their interactions with Canadians as they are today, not as a replacement for the 20th century broadcasting system.”

The bill has also caused problems for Canadian radio companies, with the CRTC announcing a two-year freeze on new radio applications starting last August while the organization focuses on implementing the regulations.