The Government has introduced a bill to require streaming services to boost their spending on Australian content.
The proposal would force platforms to invest 10% of local expenditure, or 7.5% of local revenue, in new Aussie productions.
Under the bill, quotas would apply to services with more than one million Australian subscribers. This includes Netflix, Prime Video, Stan, and Disney+.
Arts Minister Tony Burke said the legislation ensures “that no matter which remote control you’re holding, Australian stories will be at your fingertips.”
Background
Australia’s commercial free-to-air (FTA) TV networks must broadcast an annual minimum of 55% Australian content between 6am and midnight.
They also have to meet a minimum number of hours on their non-primary channels (e.g. 9Gem and 7mate).
These obligations were established to protect local productions against high-budget overseas content, particularly out of the U.S. and UK.
Pay TV like Foxtel also has obligations to invest in Australian content.
Streaming
Netflix and Stan launched in Australia in 2015. Since then, several other platforms have established a significant local presence.
A recent Deloitte report found Australians watch more content on streaming services than anywhere else, averaging seven hours and 25 minutes per week.
Unlike commercial and FTA networks, TV streaming services are not subject to minimum Australian content rules. However, industry advocates have been pushing to close this gap for several years.
The former Morrison Government said it was considering local streaming content quotas in 2019.
In 2022, then-Arts and Communications Minister Paul Fletcher put forward a proposal for streaming services to invest 5% of their revenue in local content.
Labor also committed to implementing streaming quotas after the 2022 election.
In January 2023, the Albanese Government said it would “introduce requirements for Australian screen content on streaming platforms... to commence no later than 1 July 2024.”
Legislation
Last financial year, Netflix reported $1.3 billion in local revenue and $1.25 billion in expenses.
Based on the Government’s proposal, it would be required to invest at least $97.5 million in new Aussie productions.
The Government hopes the legislation will generate new content across “local drama, children’s, documentary, arts and educational programs.”
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“We want to make sure no matter which platform people are watching, Australian stories are part of their experience,” Communications Minister Anika Wells said.
Industry response
Independent Australian TV and film production company Wooden Horse welcomed the new quota requirement.
However, joint CEO Richard Finlayson told TDA: “We’d hoped to see a higher percentage of revenue committed to Australian content.”
“7.5% feels like a low bar when you consider that premium drama series are now costing between $25m to $50m.”
Finlayson also pointed to laws in France, where platforms are required to invest at least 20% of local revenue in French and European content.
Platforms
‘Streaming for Australia’ is a coalition of platforms including Netflix, Prime Video, Disney+, Stan, and Paramount+.
The group has pushed back on content quotas, arguing that platforms already invest heavily in local content.
For example, it said streaming services invested $2.9 billion in Australian content between 2019 to 2024.
Netflix has previously warned that quotas risk reducing the “volume, variety and quality of Australian content,” rather than increasing it.
Coalition
Shadow Arts Minister Julian Leeser has accused Labor of inaction since the Coalition put forward a streaming proposal in 2022.
“In the meantime, local production has ground to a halt, leaving many in the sector in despair,” he told TDA.
Leeser “cautiously” welcomed the Government’s proposal, but said it leaves “many questions unanswered”.
“We need to be sure the announcement delivers for the Australian screen industry.”
Next steps
Labor introduced its streaming legislation on Thursday.
It has a majority in the House of Representatives, but it’s not yet clear if the bill will pass the Senate.
Greens Senator Sarah Hanson-Young said her party wants stronger measures for streaming services, including a 20% re-investment of local revenue in Australian content.
“It is likely the Greens will be in balance of power and crucial to passing this reform in the Senate,” Hanson-Young said.
