Submission to the Xx

23 May 2021 Screen Producers Australia’s submission to the Media Reform Green Paper Screen Producers Australia (SPA) was formed by the screen industry businesses representing large and small enterprises across a diverse production slate of feature film, television and interactive content. As the peak industry and trade body, we consult with a membership of more than 500 production businesses in the preparation of our submissions. This consultation is augmented by ongoing discussions with our elected Council and appointed Policy Reference Group representatives. Our members employ hundreds of producers, thousands of related industry practitioners and drive more than $1.2 billion worth of annual production activity from the independent sector. SPA’s members are drawn from all elements of the Australian production ecosystem, including emerging and established producers, production businesses, services and facilities. Our members vary in size from large internationally owned entities, to partnerships, to sole traders and other corporate entities, and are found in every region, state and territory of Australia. On behalf of these businesses, we are focused on delivering a healthy commercial environment for the screen industry through ongoing engagement with elements of the labour force, including directors, writers, actors and crew, as well as with broadcasters, distributors and government in all its various forms. This coordinated dialogue ensures that our industry is successful, employment levels are strong and the community’s expectations of access to high quality Australian content have been met. Screen Producers Australia welcomes the opportunity to submit to the Media Reform Green Paper. The release of the Green Paper, and its inclusion of proposals for Australian content obligations for streaming platforms was a vital next step in the reform process started by Government with the partial deregulation of linear broadcast media platforms in 2020. This is a pivotal moment for Australian audiences and the Australian screen sector, and a critical opportunity to ensure that all businesses which derive economic benefit from operating in the Australian market are required to make a fair and proportionate contribution back to Australian public policy outcomes. For further information about this submission please contact Holly Brimble, Director of Policy ([email protected]). 1 The SPA proposal 2 Table of Contents 1 Executive Summary .................................................................................................. 4 2 Introduction ............................................................................................................. 5 3 Overview of SPA’s regulatory proposal ..................................................................... 7 4 The regulatory proposal in detail .............................................................................. 9 4.1 Why is a percentage of revenue requirement the right model for streaming platforms? 9 4.2 Determining the appropriate rate of requirement ....................................................... 10 4.3 Thresholds ................................................................................................................. 14 4.4 Proposed exemption for broadcaster-owned businesses ............................................. 16 4.5 What expenditure counts towards the requirement? .................................................. 17 4.6 Support for vulnerable genres .................................................................................... 19 4.7 Minimum requirement to work with independent sector ............................................ 22 4.8 Monitoring of quantum of production ........................................................................ 22 4.9 Delivery to audiences ................................................................................................. 23 4.10 Transparency and reporting ....................................................................................... 23 4.11 Support fair deals in the market ................................................................................. 24 4.12 Proposed two-step regulatory implementation........................................................... 26 4.13 Timetable for implementation.................................................................................... 27 4.14 Review of implementation ......................................................................................... 27 5 CAST Fund ...............................................................................................................28 Attachment A - Consultation questions ...........................................................................29 3 1 Executive Summary • SPA welcomes the opportunity to respond to the Media Reform Green Paper (‘the Green Paper’). • The Green Paper accepts the threshold question of whether hugely successful and popular streaming platforms should be regulated, and places its focus on what shape that regulation should take. • There is an urgent need for regulatory intervention, and SPA supports the immediate implementation of a requirement that streaming services which meet certain size and scale thresholds, spend 20% of locally sourced gross revenue on commissioning new Australian content. • A requirement at this level would deliver an immediate injection of over $360 million in Australian content investment, create 10,000 jobs and over 300 hours of Australian content for audiences on these now pervasive platforms. • The requirement must be in terms of genuinely Australian content that reflects and contributes to Australia’s unique culture and society. • To protect valuable genres at ongoing risk of market failure, there should also be sub-requirements to ensure minimum levels of commissioning of adult drama, children’s content and documentary, in cases where streaming platforms are engaged with those genres. • SPA also supports minimum obligations or incentives to drive First Nations production, and an obligation to engage with the Australian independent production sector. • A critical part of any regulatory framework will be a pathway towards the negotiation of mutually beneficial terms of trade, to give producers the ability to retain IP assets and build sustainable businesses. Only content that is subject to agreed terms of trade should count towards the regulatory requirement. • SPA also supports minimum regulatory obligations for the national broadcasters. This will provide critical certainty for the industry and guarantee outcomes for viewers. • This model of regulation will ensure Australians are able to see Australian content on the services they are consuming in increasing quantities, and the pervasiveness of these platforms makes them an efficient means through which to achieve local cultural policy objectives. This model will also deliver a strong and sustainable local production sector capable of delivering this product into the market. • The Government has already started a transition of regulatory emphasis away from linear broadcast services and it is vital that it acts urgently to finish this task by implementing forward-looking and progressive requirements for the now dominant streaming platforms. • These are rapidly maturing businesses, and the concept of regulatory intervention has been live in policy discussions for many years. A regulatory ‘gap’ has been created by the partial deregulation of linear broadcast services and now is the time to act to secure the future of Australian content in the new media landscape. 4 2 Introduction The consumer entertainment landscape in Australia has undergone far reaching, fundamental and permanent change over the last 5 to 10 years. Although still important, Australians are less reliant on linear broadcast media to fulfill all of their entertainment needs and this is best reflected in the rapid uptake of subscriptions to streaming service providers. As noted in the Green Paper, this places pressure on the ability of regulatory frameworks, which apply primarily to linear broadcast media, to achieve the public policy objectives they have traditionally been asked to achieve. However, the public policy objective of ensuring Australians have access to Australian stories, endures, and hence we must ensure that our regulatory frameworks are equipped to meet these objectives in the new entertainment landscape. Regulatory intervention remains necessary given underlying market failures and an uneven contribution from different platforms. We must ensure the transition in the market is matched with a transition in regulatory frameworks. Given the pace of change, urgent action is therefore required to ensure that Australian audiences are not left worse off in terms of cultural policy objectives, just because they have embraced compelling new consumer products. Given the inconsistent levels of Australian content on streaming platforms, it is evident that there continues to be a strong need for regulatory intervention to ensure the achievement of policy objectives relating to Australian screen content within this new entertainment landscape. Whilst some streaming providers have pursued engagement with local audiences through Australian content without regulatory imperative, this not true of all providers, and the extent of voluntary engagement is vulnerable to changes in management and content strategy (and indeed fluctuations in the perceived risk of regulatory intervention). SPA submits

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