Online TV provider and program creator Netflix agreed a deal with the Canadian Government Thursday, to create and produce content in the country. The deal is reported to be worth $400.8 million, (C$500 million).
The news comes as Melanie Joly, Canada’s Heritage Minister, undertakes the job of modernizing the country’s program funding, broadcasting and copyright legislation.
Existing Canadian program producers are reported to be struggling to compete with companies like Netflix. This deal is aimed at helping to keep TV shows and films being created, filmed and produced in the country. Content in both English and French will be developed.
“Today’s announcement affirms there’s more to come as Netflix launches Netflix Canada, our permanent production presence in Canada,” Ted Sarandos, Netflix chief content officer, said in a statement
“We look forward to continuing our work with Canadian talent, producers, broadcasters, and other local partners to create Netflix originals in Canada for many years to come.”
Despite news of the agreement, which will last for five years, the Netflix share price lost a little ground during Thursday trading.
However, Open Media’s Katy Anderson said: “With Canadians increasingly turning to the Internet to consume content, it’s a smart move for the federal government to embrace a digital future for Canadian culture,” according to a Reuters report.
Following the agreement, Netflix will create a new Canadian-based studio where it will create and produce original, Canadian content to be streamed on its global service. The move represents the first permanent production studio outside of the US for Netflix.
As yet, though, there are no details on what the first project will be as part of the agreement.
Meanwhile, the agreement will also likely help secure and create TV production linked employment across Canada. Canadian government data shows the arts and entertainment industry brings $54.6 billion into the country each year. It also employs some 630,000 citizens.