The debate on initial base contributions continued at the Canadian Radio-television and Telecommunications Commission’s (CRTC) Path Forward hearings late last week.

“We believe that foreign online services should begin to contribute to the Canadian system immediately and that those contributions are long overdue,” Blue Ant Media co-founder and CEO Michael MacMillan (pictured) told commissioners on Dec. 1, adding that it would be “reasonable” to impose a mandatory initial base contribution of 5% of annual revenues as part of the requirements under the Online Streaming Act (Bill C-11).

“Our view is that online services should have the choice between a monetary contribution to a fund or via CPE [Canadian programming expenditure] – whichever is more fitting for their business model,” he said.

But Blue Ant “should not be asked to contribute a portion of our gross revenues into a fund. We need that revenue to invest in programming,” said MacMillan, who also called for a loosening of the regulatory obligations placed on Canadian broadcasters.

“This is most acutely evident in our lack of flexibility to invest in programming that meets audience demands due to our restrictive PNI [programs of national interest] requirements,” which he said, “require us to over-invest in a very limited scope of TV shows that we don’t actually need, rather than on programming that our audiences are seeking.”

WildBrain “firmly supports the equitable inclusion of online services, including foreign services, into the Canadian broadcasting system,” said president and CEO Josh Scherba, who noted that those services “should play a significant role in supporting Canadian programming, coexisting harmoniously with our Canadian production and broadcasting ecosystem.”

James Bishop, EVP and general counsel at WildBrain, told commissioners that the children’s and family broadcaster and studio supports an initial base contribution of 5% of Canadian broadcasting revenue. He said that contributions should also support the Canada Media Fund (CMF) and such CRTC-certified independent production funds, such as the Shaw Rocket Fund, and that “funding should be directed exclusively to Canadian-owned productions.”

Scherba added that “there is a separate need for specific and substantial allocations to support children’s content,” which, he noted, the CMF has identified as a priority.

Meanwhile, Amazon executives told the CRTC that Prime Video supports a contribution framework that follows the federal government’s policy direction, which calls for it to be “flexible and adaptable” and “where appropriate, use tools that are based on incentives and outcomes.”

Magda Grace, head of Prime Video Canada, urged the Commission to not “apply any mandatory initial contributions until the full scope and scale of contributions made by online undertakings have been assessed, data-driven outcomes have been set, and a flexible framework to recognize varied contributions and differentiated business models is built.”

“Once that understanding is in place,” she said, “we urge the Commission to allow undertakings to satisfy these requirements at least in part by their own direct investment.”

“The allowance of direct investment to satisfy obligations under the new framework will also promote competition, diversification, affordability, and innovation in the online broadcasting space,” said Grace, who said that Amazon does not support “the channeling of contributions to a small number of legacy funds,” which she noted, would “limit our ability to quickly respond to customer demand and interest and slow [the] creative process.”

Grace also urged the CRTC to “evaluate whether legacy funds sufficiently support the diverse film, television, and music talent of the future” and said that it would be “inappropriate at this time to require contributions from revenues generated from unique transactions – or what we also call TVOD [transactional video on demand] and online content storefronts.”

“These are low margin businesses, providing services with the bulk of the revenue going to producers, distributors and broadcasters, and over which streamers [like Amazon] have limited creative control,” said Grace. “Just as the Commission did not extend its scope to brick-and-mortar video stores, it would be undue regulation to include these businesses for streamers.”

Scott Garvie, EVP of business and legal affairs at Toronto-based prodco Shaftesbury, told commissioners to “treat the streamers the same as the Canadian broadcasters.”

“It is equitable that the new contributors should have access,” he said, to funds flowing from a base contribution model, but that it should not be on a “100% self-directed basis.”

The CRTC’s Path Forward hearings will continue until Friday (Dec. 8).