How will the CRTC's new podcast regulations impact the industry?

15:42The impact of the CRTC's new podcast regulations

The CRTC has taken its first step in implementing the Online Streaming Act, passed in April.

The regulatory body announced that streaming services like Spotify and Netflix will need to register their information with the CRTC.

Podcast critic Nicholas Quah, policy expert Vass Bednar and podcast host Mattea Roach talk about how the podcasting industry, both in Canada and abroad, has reacted to the news.

We've included some highlights below, edited for length and clarity. For the full discussion, listen and follow the Commotion with Elamin Abdelmahmoud podcast, on your favourite podcast player.

Elamin: The fear, Vass, is that these companies can up and leave, right? If you are a radio station and you go to the CRTC to renew your license, they can impose some conditions on you — and you need to meet those conditions in order to operate in this country. Whereas if you are Disney+ or Spotify, theoretically you could go, "That's too stringent. I'm going to just stop operating in this place." That is the most dramatic version of this, but is that a reason for the CRTC not to look at regulating these institutions?

Vass: I don't think it's a reason. I mean, these companies are at the table. The CRTC has published the positions of these firms. They've sort of said, "This will infringe on our ability to innovate. It's already a really tough market." But this is a tough market that they control in their favour, and they changed remuneration, etc.

I think fear comes from the uncertainty, and the uncertainty comes from the fact that these details are going to be hammered out in the regulatory process, not the legislative one. So when you have a piece of legislation that's poorly rationalized … there's a vacuum, and fear will fill that vacuum. You'll hear words like "censorship," and we'll talk about free speech, which sort of pollutes what this whole policy was even trying to do in the first place.

Elamin: I'm glad you brought that up because both Spotify and Apple at this point are like, "Yeah, it is fine. We will register." It is not a real problem to them, but Mattea we should say the Canadian podcast industry is pretty heavily dependent on those platforms — Spotify, Apple — to distribute their content. So what's at stake for homegrown podcasting companies like you're a part of, for example?

Mattea: I want to say, first off, anything that I say is not to be taken as a company position, but just sort of my analysis of it as a journalist. I think in terms of what's at stake, discoverability is a huge issue for podcasters, particularly for people that are beginning to create content, right? I think if you have an established brand and you're getting featured, say, in the little bar on Apple Podcasts, maybe you're able to use these platforms pretty well to develop an audience as it exists right now. But I think discoverability is a big issue, and so to the extent that any sort of regulatory change might increase the amount of Canadian content that people are being shown on their Spotify homepage, on their Apple homepage, that could be really good.

I think the reason why there's some fear among people working in the podcasting space, though, is we've just seen some clumsy digital regulations that have had unforeseen externalities. With Bill C-18, the Online News Act, that was trying to do revenue sharing with Canadian news media organizations…. What we've seen happen in response to that is that Meta has just restricted all access to news for Canadians.

Elamin: And you can't get news on Facebook or Instagram.

Mattea: Exactly. Spotify and Apple said they're going to play ball so far, and that's really great news. I don't think, to be clear, this fear of companies leaving is a reason to not attempt any kind of regulation. But I think because we've seen other attempts to legislate the digital world, these pullbacks from these large tech companies, that is where the fear comes from. It doesn't feel totally unfounded to me.

Nicholas: Well, isn't the fear there precipitated largely from what I would characterize as bad actor behavior on the part of Meta? It's less about the policy part of it and more about the corporate response to it, which is more self-serving than not most of the time.

Elamin: Well, I was going to say, Meta is also a company that sees these registration requirements as actually too high. So there's a range of experiences when it comes to these massive companies and how they want to respond to any hint of regulation.

Mattea: Yeah, I would say so. And what Meta does/their tolerance for being regulated is not necessarily going to be the same as Spotify's tolerance or Apple's tolerance. We're talking about two different pieces of legislation; I only bring up the Online News Act as a means of drawing an analogy to explain why some people are a bit wary. So again, I do think it's partly to do with bad actor incentives in terms of why Meta was like, "Let's just pull all news content."

Vass: We should be careful about buying into that. This is a tale as old as time: companies saying, "If you take a regulatory stance that we don't like, we're going to up and leave." It's way easier in a digital context when you don't have the brick-and-mortar infrastructure here, or maybe not as many jobs, to code and say, "We're not going to be here." That makes things different.

But I think we can risk losing sight of what the rules and what that relationship is supposed to be or could be between the state and these digital firms when they threaten us and when they have the power to threaten us like that. And so it's creating fear because it's so destabilizing. We should think and talk about their market power as well and their ability to do that and sort of threaten us. Maybe that's a reason we need to rethink the broadcasting system of the future.

Elamin: Nicholas, earlier this year Spotify asked for podcasts to be exempt from regulation due to the "economic strain" in the industry. Can you just broadly describe the health of podcasting right now?

Nicholas: Right now it's having a bit of a rough year, but not too much different than the rest of the media business, to be frank. But it's a little ironic of Spotify to be making that claim because they are in large part responsible for the dynamics, that a lot of the podcast advertising industry has become broadly dependent on Spotify. But right now, the increasing interest rates and the fear of a recession has caused a lot of marketing budgets to pull back and that has sort of trickled down to hurt principally a lot of the companies that were setting up more speculative positions in the space. Though I have heard it's been a generally OK time for independents that were strong before they were working with not-advertising-heavy budgets. It's a tough time and we've been seeing a lot of layoffs. But I've been hearing some optimism about the first quarter of next year, so this might be a very different picture a year from now.

You can listen to the full discussion from today's show on CBC Listen or on our podcast, Commotion with Elamin Abdelmahmoud, available wherever you get your podcasts.

Panel produced by Jane van Koeverden.