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Minister of Canadian Heritage Melanie Joly takes to the stage to outline the government's vision for cultural and creative industries in a digital world in Ottawa, Thursday September 28, 2017.


Heritage Minister Mélanie Joly's $500-million Netflix announcement did not include concrete details on the streaming service's plans to invest in Canadian TV productions and also left unanswered questions on the deal's actual worth.

The five-year commitment from the U.S.-based company to open a production house in Canada generated most of the buzz in the culture industry at Ms. Joly's announcement of a new federal cultural policy in Ottawa on Thursday.

Canada's new cultural policy: The 10 key takeaways

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The Netflix deal is a very sweet deal for Netflix, not Canada

Mélanie Joly's Netflix deal fails to address the real issues for Canadian content creators

However, no one from Netflix was present at the announcement to explain the company's plans in Canada.

A key question is whether Netflix's investment will go toward what would traditionally qualify as "Canadian content" – a determination based on the citizenship of key creative individuals such as writers, directors and actors. There is also a possibility the investment will include "service productions" that are simply made with Canadian crews, such as the Toronto-shot blockbuster movie Suicide Squad.

At a news conference, Ms. Joly had few details to offer on the company's actual obligation under the confidential agreement with Ottawa. In particular, she didn't say how much Netflix was currently spending on Canadian productions or how much it was planning to spend in Canada before it signed the deal.

"We went and got the biggest investment in the last 30 years in Canadian content from a foreign company. We did that to support our industry, support our creators, while not taxing more Canadians," she said.

While the government denied any quid pro quo, its decision not to impose a sales tax on Netflix angered those who argued Ottawa had to "level the playing field" with Canadian-based firms.

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"This deal is like Netflix paying itself $500-million to produce content that it will sell for a profit. This is an unfair situation for Canadian companies," Quebec Minister of Culture Luc Fortin said.

Critics quickly pointed out that Netflix recently touted Canada as its third-biggest location for original productions after the United States and Britain.

"In 2016 alone, we've commissioned hundreds of millions of dollars of original programming produced in Canada. And Netflix has made dozens of commitments in 2016 for Netflix original movies and television series that will be produced in Canada," the firm said in a letter last year to Ms. Joly.

David Sparrow, president of the Alliance of Canadian Cinema, Television and Radio Artists, said he is concerned the Netflix deal will be the basis for deals with other foreign-based streaming services.

"Are we allowing foreign multinational companies to basically set their own rules when we already have regulations in place for our broadcasters?" he told reporters.

The matter could become politically sensitive for Ms. Joly, who is from Montreal, as there are particular worries in Quebec that Netflix faces no obligations to produce French-language shows.

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"There are good measures in today's announcement," said Hélène Messier, president of Quebec's association of movie and television producers. "But the Netflix deal is a cause for concern. There are no requirements for French-language content, so they could end up providing subtitled or dubbed material in Quebec."

During Question Period in the House of Commons, the NDP accused the government of "outsourcing" the protection of Canadian culture to U.S. companies.

"There are no guarantees on Canadian content, French-language content, aboriginal content or any content that reflects our identity and our history," MP Pierre Nantel said.

Prime Minister Justin Trudeau responded that the five-year deal is proof the Canadian industry can compete on the world stage.

"Canadians have world-class content creators and creative industries and we know that investing in them and supporting our creators is the best way to ensure that Canadians hear our stories [and] people around the world hear stories Canadians have to tell," he said.

Katie Boland, a writer, director and actor, said the Netflix deal will mean more work and opportunities for Canadian artists and creators.

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"It means more money put into the Canadian industry, which means more production and more work for everybody," said Ms. Boland, who was one of the advisers to Ms. Joly on the cultural-policy overhaul.

Maureen Parker, executive director of the Writers Guild of Canada, cheered the Netflix announcement, noting there is a shrinking pool of places for writers to pitch shows.

"It seems like the privates [commercial broadcasters] aren't interested in making Canadian content, they do so most reluctantly, and now we have a company saying, 'We want to work with Canadians.'… It's exactly what we needed," she said.

Ottawa also faced criticism for offering few details on plans to help the news-media industry. Ms. Joly promised to modernize the Canada Periodical Fund, while vowing not to bail out companies that are not viable.

"We've never asked for a bailout," said Paul Godfrey, chief executive officer of Postmedia Network Inc. "Innovation is important to Postmedia's future. … The only path is to try to build up the digital side to try and compensate for what you lose on the print side."

Bob Cox, chair of News Media Canada, said he was disappointed by Ms. Joly's failure to address the challenging state of Canadian newsrooms.

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"Unfortunately, there was nothing concrete in the speech that will help the news gathering that we do. There was money for other cultural pursuits, for the Canada Media Fund, for cultural efforts abroad, but no support for journalistic content," he said.

John Morayniss, CEO of eOne Television, warned that a $125-million new program to help individual producers export their products will not help build a strong Canadian-based group of companies that are able to invest profits back into new shows.

Small producers "will be swallowed up by the Warner Brothers or the Disneys, the Netflixes," he said. "In the short term, it may be fine and they'll make some money off of it. In the long term, you're not building the part of the ecosystem that is as crucial as the starting point, the creative part."

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