Streaming services such as Netflix and Amazon Prime would have to meet Australian content requirements under a federal government proposal to help local production.
Communications Minister Paul Fletcher on Friday released media reform plans in light of fears some providers could collapse due to the rise of online streaming.
Public feedback is being sought on the plan until March 7 next year.
One proposal is to make video-on-demand services use part of their Australian revenue on commissioning, co-producing and acquiring Australian content.
It would apply to both subscription and advertising-based services.
Companies would have to report to the communications watchdog and could face trouble if they fail to meet expectations for two consecutive years.
Mr Fletcher said the new technologies had fractured business models and made some regulations obsolete.
"With declining revenues, rising costs and an outdated regulatory framework, the capacity of Australia's media sector to provide Australian programming, local content and public interest journalism is being challenged," he said.
"These structural pressures have been accelerated by the economic impact of the COVID-19 pandemic, reinforcing the need for regulatory action."
Media union chief Paul Murphy says thousands of workers including skilled writers, directors, creatives, technicians and performers faced uncertain futures, making government action critical.
"Getting this reform right will create thousands of jobs and also benefit audiences for generations to come by bringing more uniquely Australian stories to the screen."
The Greens say the amount of local money companies have to put back into Australian content is crucial, urging the government to look overseas, where France has brought in a 20 per cent benchmark.
The plan also includes new laws to lock in requirements for the ABC and SBS to commission and provide new Australian programming.
The reform may include offering free-to-air television broadcasters lower-cost models using less radiofrequency spectrum.
The government proposes selling off part of the spectrum, with some of the money to help support news media and screen productions.
The Public Interest News Gathering fund was set up as a pandemic relief measure, but would become a permanent trust through the proposals.
The reform paper says that some public policy goals, such as having a wide availability of news services, is at risk as audiences move away from free-to-air TV.
It notes that older Australians, those in regional and remote areas, as well as those with smaller budgets, were less likely to pay for streaming services.
Australian Associated Press