Streaming giants push back on federal government’s new Australian content rules

Streaming giants push back on federal government’s new Australian content rules

Some of the country’s most popular streaming services are preparing to negotiate or withdraw plans altogether to have new Australian content rules imposed on them.

Key points: Major streaming services will be required to invest revenue in producing local content from mid-2024. Australian production companies want the threshold set at 20 percent. Some streaming platforms argue that they should be exempt from the changes

On Sunday, the federal government unveiled its new National Culture Policy, including an intention to legislate local content rules for streaming platforms.

The rules are likely to force the companies to spend a certain percentage of their revenue on the development of Australian content.

Australian production companies want that threshold set at 20 percent, which would secure hundreds of millions of dollars in investment each year.

A number of the major streaming companies have previously argued for a figure closer to two percent.

The government has given itself six months to decide on a package of changes, which it has committed to implementing from July 2024.

Some of the major streaming platforms are already warning that any new rules must be “sustainable” and “fair”, while others argue that they should be exempted entirely.

An uneven flowing landscape

Work on a local content policy for streaming services has been underway for years, and the policy plan didn’t come as a surprise to major streaming platforms like Netflix, Stan, Amazon and Binge.

Consultation with the various streamers will now begin, but many have been vocal for some time about what form they think the laws should take.

Some are keen to point out the differences between the different companies, despite how similar their offerings may seem.

Netflix, for example, is a global streaming giant whose primary business model is online video-on-demand, while Disney is a massive global entertainment producer.

Stan, Binge and Paramount Plus are all subscription streaming arms within larger media companies – Stan is owned by Nine Entertainment, Binge is owned by Foxtel, and Paramount Plus is part of Paramount ANZ, which also owns Channel Ten.

Their traditional broadcasting arms are all subject to existing local content rules, which apply to both free-to-air broadcasters and subscription services.

Amazon Prime is different again, the offshoot of the online retail behemoth.

In a statement to the ABC, a spokesperson for Netflix Australia said the company welcomed the regulation but was keen to ensure it worked for the sector.

“We are not against regulation, but we do want it to be sustainable, fair and evidence-based,” they said.

Netflix, Amazon, Disney and Apple TV all offer streaming services in Australia.. (Supplied.)

Nine, Foxtel and Paramount are all keen to point out that placing rules on their streaming services would mean they are subject to two sets of local content rules – one for their broadcast services and one for their subscription streaming services.

Stan made a presentation to the government while he was drafting the new Culture Policy and argued that case.

“To avoid duplication of regulatory obligations, streaming services owned by the holder of a commercial free-to-air television license should be excluded from any kind of investment obligation,” it said.

Foxtel made a very similar case in its own submission, pointing out that content is shared across its traditional subscription service and streaming platform Binge.

“As the Foxtel group is already subject to an Australian content obligation, we ask that the Foxtel group be excluded from any new Australian content regime,” it said in its submission.

In its submission, Paramount sought to ensure that content could be created to cover both local content rules on its streaming arm, as well as quotas on Channel 10.

If not, it warned that the highest-quality shows would inevitably go on its paid Paramount Plus service, rather than 10.

“(Streaming) services will inevitably seek to exclusively retain the best content in an effort to financially justify the investment submissions arising under the mandatory scheme,” reads part of its submission.

What makes Australian content Australian? Netflix’s Heartbreak High was a locally produced production. (Netflix)

The major streaming platforms have all pointed to the Australian shows they already produce as proof that the new rules are largely unnecessary as the industry is “vibrant”.

Netflix highlighted productions such as Heartbreak High and Boy Swallows Universe, Foxtel to shows such as The Twelve, and Stan to productions such as The Tourist and Bump.

In total, Disney, Amazon, Netflix, Stan and Paramount Plus spent $335 million on Australian content in 2021-22, according to the Australian Communications and Media Authority.

The federal government argues that while the spending is welcome, the rules are necessary to ensure that type of commitment is maintained in the future and preferably grows.

A key factor in those considerations will be deciding what really qualifies as Australian.

The general definition, proposed to be adopted under a previous plan from the former Morrison government, is essentially an Australian program “produced under the creative control of Australians”.

The services largely want the definition of Australian content to be broad and flexible.

Netflix argued that Stan’s series The Tourist, a co-production with the BBC starring Northern Irish actor Jamie Dornan and shot in South Australia, should be considered Australian content.

Stan also pointed to that series as an example of an opportunity to drive global investment in Australian production, and the kind of arrangement that should be encouraged.

Arts Minister Tony Burke made it clear that the definition must not only ensure that content is made in Australia, but that it is also distinctly Australian in nature.

“Some of the streamers want to say anything that involves any Australian is automatically Australian content,” he told Sky News.

“They’ll say, you know, Thor was filmed here or Elvis was filmed here.

“I think most Australians would say that those movies aren’t necessarily us watching our own stories on screen.”

The government wants legislation before parliament this year.

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