The NetFix is in. Streaming production quotas no bonanza
Is there a ‘bonanza’ for local film and TV producers in the new local content rules, or is this just another Hollywood scam by Netflix? Kim Wingerei he asks.
The new laws require major streaming services with more than one million subscribers to invest at least 10% of their local spend, or 7.5% of their Australian revenue, on local content. When it was announced, it was hailed as a huge win for Australian film production, with estimates of additional revenues in the hundreds of millions of dollars.
Netflix is the biggest of the streamers, with (reported) Australian revenue of $1.3 billion last year. Their estimated market share is at least 25%, according to MediaWeek (2024), indicating that the total streaming market in Australia is $5.2 billion.
Despite the vagaries of multinational revenue reporting, 7.5% of that figure amounts to $390 million if all broadcasters meet the requirements and comply with the rules. That’s a big if.
The top five broadcast companies spent a total of $414 million on 4,500 Australian programs commissioned, co-commissioned or acquired in the last financial year, according to a recent report by the Australian Communications and Media Authority (ACMA).
In a press release issued by Netflix (sic!), Paul Miller, President of the Australian Broadcast Coalition, states that ACMA data “clearly shows that Australia’s SVOD services are already investing at a higher rate than Australia’s broadcasters,” and notes that the local content quota results in:
Trying to solve a problem that doesn’t exist.
Local context (patient) defined
Analyzing ACMA data, Australian documentary filmmaker Simon Nasht states that of the 4,500 programs “commissioned”, 4,459 were acquired, of which 3,901 were sports programmes. This means that only 1.5% of broadcasters’ Australian content consists of new and original programmes.
as nasht A joke was made on LinkedIn, “We absolutely love our sport in Australia now. But to somehow turn that into pretending to care in the slightest about telling real, meaningful original Australian stories like drama, documentaries, kids and culture?”
The truth is that publishers’ investment in real local content is decreasing. Their investment in new Australian adult drama fell According to ACMA figures, from $32.5 million in FY 2023-24 to just $19 million last year, or 6% of the total $309 million spent by the sector overall.
Content spend in Australia. Source: ACMA
Publishers conveniently ignore government subsidies of up to 40%, claiming their expenses are much more than that. (Until now, reporting has been voluntary.)
They also ignore the fact that the local broadcast industry still pays a license fee for the use of broadcast spectrum, while broadcasters do not and have an unlimited free distribution channel paid for by the public, also known as the NBN.
What about the practitioner?
The new content legislation, which will come into force as of January 2026, aims to cover drama, documentaries, arts and educational programs for adults and children. Sports, acquisition of existing content and light ‘entertainment’ such as “The Vagabond Husbands of Wagga-Wagga” are excluded.
In theory, this means there’s a big gap to fill between current spending (even accepting the streaming platform’s own figures) and what the law would require.
But the law is quite crude in how it applies to regulation, other than under the auspices of ACMA, which is an underfunded and ineffective regulator. ACMA is also responsible for enforcing the social media age ban and does not receive any extra funding.
The arbitrary use of one million subscribers per platform is also concerning. For example, Netflix and Warner Bros. (which owns HBO Max) If the proposed merger goes ahead, it would mean less of a streaming platform and potentially (probably) less revenue as a combined entity.
Publishers can also choose to use 10% of their spend as a basis for calculating quota requirements. As every multinational company accountant knows, this will bring creative license to the dramatic tension between debit and credit entries.
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Kim Wingerei is a businessman turned author and commentator. He is passionate about freedom of expression, human rights, democracy and the politics of change. Originally from Norway, Kim has lived in Australia for 30 years. Author of ‘Why Democracy is Broken – A Blueprint for Change’.
