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TRANSCRIPT OF PROCEEDINGS BEFORE
THE CANADIAN RADIO‑TELEVISION AND
TELECOMMUNICATIONS COMMISSION
TRANSCRIPTION DES AUDIENCES DEVANT
LE CONSEIL DE LA RADIODIFFUSION
ET DES TÉLÉCOMMUNICATIONS CANADIENNES
SUBJECT:
REVIEW OF THE OVER-THE-AIR TV POLICY /
EXAMEN DE CERTAINS ASPECTS DU CADRE RÉGLEMENTAIRE
DE LA TÉLÉVISION EN DIRECT
HELD AT: TENUE À:
Conference Centre Centre de conférences
Outaouais Room Salle Outaouais
Portage IV Portage IV
140 Promenade du Portage 140, promenade du Portage
Gatineau, Quebec Gatineau (Québec)
November 30, 2006 Le 30 novembre 2006
Transcripts
In order to meet the requirements of the Official Languages
Act, transcripts of proceedings before the Commission will be
bilingual as to their covers, the listing of the CRTC members
and staff attending the public hearings, and the Table of
Contents.
However, the aforementioned publication is the recorded
verbatim transcript and, as such, is taped and transcribed in
either of the official languages, depending on the language
spoken by the participant at the public hearing.
Transcription
Afin de rencontrer les exigences de la Loi sur les langues
officielles, les procès‑verbaux pour le Conseil seront
bilingues en ce qui a trait à la page couverture, la liste des
membres et du personnel du CRTC participant à l'audience
publique ainsi que la table des matières.
Toutefois, la publication susmentionnée est un compte rendu
textuel des délibérations et, en tant que tel, est enregistrée
et transcrite dans l'une ou l'autre des deux langues
officielles, compte tenu de la langue utilisée par le
participant à l'audience publique.
Canadian Radio‑television and
Telecommunications Commission
Conseil de la radiodiffusion et des
télécommunications canadiennes
Transcript / Transcription
REVIEW OF THE OVER-THE-AIR TV POLICY /
EXAMEN DE CERTAINS ASPECTS DU CADRE RÉGLEMENTAIRE
DE LA TÉLÉVISION EN DIRECT
BEFORE / DEVANT:
Michel Arpin Chairperson / Président
Rita Cugini Commissioner / Conseillère
Richard French Commissioner / Conseiller
Elizabeth Duncan Commissioner / Conseillère
Ronald Williams Commissioner / Conseiller
ALSO PRESENT / AUSSI PRÉSENTS:
Chantal Boulet Secretary / Secrétaire
John Keogh Legal Counsel /
Valérie Lagacé Conseillers juridiques
Shelley Cruise
Peter Foster Hearing Manager /
Gérant de l'audience
HELD AT: TENUE À:
Conference Centre Centre de conférences
Outaouais Room Salle Outaouais
Portage IV Portage IV
140 Promenade du Portage 140, promenade du Portage
Gatineau, Quebec Gatineau (Québec)
November 30, 2006 Le 30 novembre 2006
TABLE DES MATIÈRES / TABLE OF CONTENTS
PAGE / PARA
PRESENTATION BY / PRÉSENTATION PAR:
Shaw Communications 1089 / 5956
Bell Canada 1141 / 6261
Cogeco Inc. 1228 / 6805
British Columbia Institute of Technology 1277 / 7026
Fédération nationale des communications 1306 / 7211
Société des autres et compositeurs dramatiques 1339 / 7417
et de la Société civile des autres multimédia
Shaw Rocket Fund 1365 / 7565
Gatineau, Quebec / Gatineau (Québec)
‑‑‑ Upon resuming on Thursday, November 30, 2006
at 0830 / L'audience reprend le jeudi
30 novembre 2006 à 0830
LISTNUM 1 \l 1 \s 59485948 THE CHAIRPERSON: Order, please. À l'ordre, s'il vous plaît.
LISTNUM 1 \l 15949 Madame la Secrétaire. Mrs. Secretary.
LISTNUM 1 \l 15950 LA SECRÉTAIRE : Merci, Monsieur le Président.
LISTNUM 1 \l 15951 Avant de débuter, j'aimerais rappeler aux participants que l'interprétation gestuelle est disponible durant cette audience, et si vous voulez bénéficier de cette interprétation, s'il vous plaît m'en faire part.
LISTNUM 1 \l 15952 Also, for the information of the participants in these proceedings, we would like to indicate that we do have some additional information that was added to the public record since the commencement of this hearing. Copies are available in the examination room.
LISTNUM 1 \l 15953 In addition, we have ‑‑ nous avons une étude sur la production indépendante, mentionnée dans le mémoire du Conseil provincial du secteur des communications du Syndicat de la fonction publique, qui est le commentaire numéro 42. Cette étude était mentionnée dans leurs commentaires. Elle a été déposée au dossier public.
LISTNUM 1 \l 15954 We are now ready to proceed with the next presentation this morning of Shaw Communications Inc. Mr. Jim Shaw will introduce his panel, after which you will have 15 minutes for your presentation.
LISTNUM 1 \l 15955 Mr. Shaw.
PRESENTATION / PRÉSENTATION
LISTNUM 1 \l 15956 MR. SHAW: Thank you and good morning. I apologize, I am getting a bit of a cold, so I won't be speaking too loud and hopefully everybody can hear.
LISTNUM 1 \l 15957 It is a pleasure to have with me today Michael D'Avella; our President Peter Bissonnette; the guy we call Ken "Steinovich" ‑‑ it is really Ken Stein but we nickname him and I am sure he is familiar to all of you here. We have our trusted advisor and long‑term member of CRTC panels, Chris Johnston, with us; Cynthia Rathwell; and Mike Ferras today.
LISTNUM 1 \l 15958 So with that I think you will be pleased to know that our presentation will be quite brief, as was our ad in the paper.
LISTNUM 1 \l 15959 We are Canada's largest video ‑‑
LISTNUM 1 \l 15960 THE CHAIRPERSON: You are just giving me an opportunity because I was looking for one and I have one.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 15961 MR. SHAW: I thought I had 15 minutes.
LISTNUM 1 \l 15962 THE CHAIRPERSON: I have nothing against your ad and I was told that CanWest Global and BGM are very pleased that you took that much lineage in their newspapers. So I am sure they appreciate the intent.
LISTNUM 1 \l 15963 MR. SHAW: Yes. I understand ‑‑
LISTNUM 1 \l 15964 THE CHAIRPERSON: It was also followed by emails that my colleagues and I have received and numerous other members of Parliament have also received.
LISTNUM 1 \l 15965 MR. SHAW: Right.
LISTNUM 1 \l 15966 THE CHAIRPERSON: But on behalf of my colleague Mr. French and myself, I want to say that we are pleased to see that your employees are not concerned about losing their job but they are concerned about accountability, they are concerned about ‑‑ let me read it through ‑‑ the core values of your company, which is accountable, balance, customer focus, integrity, loyalty, positive, can‑do attitude and team player.
LISTNUM 1 \l 15967 MR. SHAW: Right.
LISTNUM 1 \l 15968 THE CHAIRPERSON: Personally, I have received over 100 of them, mostly, mostly from your own employees, not from the general public.
LISTNUM 1 \l 15969 For the record, I want to let you know that we will not take them into consideration because the time to file comments was September the 27th ‑‑
LISTNUM 1 \l 15970 MR. SHAW: Okay.
LISTNUM 1 \l 15971 THE CHAIRPERSON: ‑‑ and it was known at that time that the broadcasters were to seek fee for carriage. We understand that you are quite upset by the idea of the broadcasters. That is why we are having this forum.
LISTNUM 1 \l 15972 MR. SHAW: Right.
LISTNUM 1 \l 15973 THE CHAIRPERSON: But I don't think the way the whole matter has been handled so far was the correct way.
LISTNUM 1 \l 15974 MR. SHAW: I would just like to say back that it is our view and our intention and has been for quite a while to allow Canadians to have a view. I get calls from customers every day asking me to keep them informed and involved. Now whether we did that in a right form or we did it in the wrong form ‑‑
LISTNUM 1 \l 15975 THE CHAIRPERSON: Well the thing is that wait for the decision. Obviously, if the decision was to be the one that you are asking us to make, i.e. authorizing fee for carriage, then I could understand the campaign. But so far it was not warranted. So you have in face of you members, particularly myself, who is not very happy about this campaign.
LISTNUM 1 \l 15976 MR. SHAW: Okay. Should I continue?
LISTNUM 1 \l 15977 THE CHAIRPERSON: Yes, you could.
LISTNUM 1 \l 15978 MR. SHAW: Okay.
LISTNUM 1 \l 15979 We are Canada's largest video provider, servicing over 3.1 million Canadian customers and we are here today to speak to you on behalf of those customers.
LISTNUM 1 \l 15980 We would also like to present our views on the future of the broadcasting system.
LISTNUM 1 \l 15981 Contrary to what a lot of you have heard over the past few days, we think the future is incredibly bright for broadcasters, distributors and consumers.
LISTNUM 1 \l 15982 We operate in a highly competitive environment driven by the demands of our customers.
LISTNUM 1 \l 15983 Over the past five years we have invested over $4 billion in expanding capacity, in introducing services in our cable and satellite businesses. We have also made a tremendous investment in customers, servicing, providing 24/7, 365, same day, next day. This is what we do to remain competitive, innovative and leaders in our business.
LISTNUM 1 \l 15984 We have virtually no regulatory protection, lots of competitors and a growing black market satellite problem. We have to compete every day to keep the customer.
LISTNUM 1 \l 15985 The industry does not need new layers of regulatory protection. Instead, we should use our strengths, work together and conquer all challenges of the digital world. We can do this by innovating and putting the customer first.
LISTNUM 1 \l 15986 As we face more competition, the answer will not be to increase prices without increasing value. If we do, we will lose the loyalty of our customers and everyone will suffer.
LISTNUM 1 \l 15987 Rogers and others have discussed the harm of the entire system that will result from a fee for carriage and we strongly agree with their submission and their positions but today we are here to talk about problems and we are here to talk about solutions.
LISTNUM 1 \l 15988 MR. BISSONNETTE: One of the most important elements of our vision of a bright future is a strong analog basic cable service.
LISTNUM 1 \l 15989 Local broadcasters will always be part of this service. The fact is that 70 percent of our customers take only analog services. That is why we believe that a strong analog offering is not only good public policy but great for consumers and good for business.
LISTNUM 1 \l 15990 We believe that a strong analog service is a competitive advantage to the system in a world where customers want the best programming on two, three, four or even five outlets in the home without having to buy a digital box.
LISTNUM 1 \l 15991 But make no mistake, we are committed to developing a strong digital platform as well.
LISTNUM 1 \l 15992 We are always adding new digital services, especially high definition television, and we recently made the move to simulcast, all analog services in digital, so that we could offer our customers a low cost digital box. In addition, we have also invested over $2 billion in Star Choice, our all digital service.
LISTNUM 1 \l 15993 And the strength of our digital and analog offerings are strengths for the system and for broadcasters.
LISTNUM 1 \l 15994 Broadcasters rely on cable and satellite to provide stronger, interference‑free, reliable signals throughout their coverage areas. In fact, along with the priority carriage and simultaneous substitution, broadcasters rely on cable to deliver 90 percent of their audiences.
LISTNUM 1 \l 15995 We are committed to ensuring that all conventional broadcasters receive priority carriage as part of our basic service. Broadcasters will continue to have tremendous opportunities to generate billions of dollars in advertising revenue to support their businesses. We think this is being and will continue to be an extremely fair bargain for broadcasters, consumers and BDUs.
LISTNUM 1 \l 15996 Broadcasters have the largest audiences and continue to take the lion's share of all TV advertising. They are the largest best‑known destination for the most popular Canadian and U.S. programming. Conventional TV is still the most watched service and its revenues continue to grow.
LISTNUM 1 \l 15997 We further support strengthening the system by giving broadcasters even more market‑based opportunities to generate revenue. We suggest full advertising flexibility, including removing the 12‑minute advertising limit and allowing promotions, sponsorship and product placement.
LISTNUM 1 \l 15998 MR. D'AVELLA: We would also like to discuss time‑shifting in some detail because it has been raised as problem when in reality it is one of the great strengths of the system and one that supports the ability of broadcasters to generate advertising revenue.
LISTNUM 1 \l 15999 Time‑shifting preserves advertising, unlike, for example, PVRs, it increases windows available for Canadian programming, it encourages Canadians to adopt digital technologies, and it keeps our broadcasting system competitive with unregulated options by offering more choice and flexibility to viewers.
LISTNUM 1 \l 16000 Broadcasters, predominantly large national companies, should find ways to monetize the value of time‑shifting instead of trying to eliminate or reduce choices for consumers.
LISTNUM 1 \l 16001 Large‑market broadcasters such as CanWest and CTV call for DTH to distribute all local stations to preserve broadcasters' existing advertising models.
LISTNUM 1 \l 16002 Star Choice already carries nine CanWest stations and 10 CTV stations in standard definition. We foot the entire bill for their distribution on costly and scarce national satellite transponders. In the future we are going to need capacity for HDTV services to sustain our competitive position and give our customers greater value.
LISTNUM 1 \l 16003 We also currently carry 13 small‑market broadcasters on Star Choice. Six of these broadcasters are owned by the Pattison Group, Newcap and Standard Broadcasting. They are affiliates of the large national networks and broadcasters.
LISTNUM 1 \l 16004 From a Star Choice customer perspective, they add little value outside of their local communities. Mandated carriage of even more of these services is unnecessary. For Star Choice, it is untenable.
LISTNUM 1 \l 16005 We cannot and the system cannot afford to waste scarce and expensive resources on the distribution of stations that add little value. By the broadcasters' own admission, these stations are highly duplicative and offer a limited amount of unique local programming.
LISTNUM 1 \l 16006 The CRTC has identified omnibus channels as a way to make efficient use of capacity. However, there appears to be little willingness on the part of broadcasters to explore this practical solution. Giving them more regulatory protection will only reinforce that unwillingness. We need a strong signal from the Commission or means to make omnibus channels more achievable.
LISTNUM 1 \l 16007 We also think that small markets provide excellent opportunities. Shaw has over 100 cable systems with less than 6,000 subscribers. We recently purchased some small cable systems in Whistler, Grand Forks and Kenora.
LISTNUM 1 \l 16008 These markets represent challenges but we have found ways to bring new digital services, high‑speed internet and soon even digital phone to some of these small communities. Serving small markets takes work, investment and innovation but it can be done.
LISTNUM 1 \l 16009 MR. STEIN: As business people we prefer market‑based solutions. We don't like being told what to do and we don't want to tell broadcasters what to do.
LISTNUM 1 \l 16010 With respect to the question of whether broadcasters should be required to provide an over‑the‑air digital or HD signal, that is their business decision to make. Shaw is committed to distributing the broadcasters' over‑the‑air digital services on basic, no matter how they deliver the signal to our headend, provided there is no fee for carriage.
LISTNUM 1 \l 16011 We would like to work with broadcasters to ensure a smooth transition to digital. HD provides broadcasters a fantastic new opportunity to strengthen their service and to counter the attraction of web‑based services.
LISTNUM 1 \l 16012 Yes, it will cost money to implement high definition but that is the cost of doing business. Our cost to facilitate distribution in the next five to 10 years will be in the billions for Star Choice and for our cable systems as we acquire and operate transponders and expand cable capacity.
LISTNUM 1 \l 16013 We encourage broadcasters to make the investments they need to make. Improving high definition content will be one of the ways that we will retain and even repatriate customers.
LISTNUM 1 \l 16014 We also need a regulatory framework that puts the consumer first. This means replacing complex and inflexible rules with a simple rule requiring BDUs to distribute a majority of Canadian services. This will ensure Canadian programming choices exist so that people are always able to buy Canadian.
LISTNUM 1 \l 16015 Collectively, the regulator, broadcasters and distributors will need to foster innovation, provide greater choice and ensure continued viewer loyalty to the Canadian broadcasting system. This is the only way to succeed in a digital world.
LISTNUM 1 \l 16016 MR. SHAW: Throughout the history of the Canadian broadcasting system, which you all know very well, we face many challenges. The current situation is no different. Thankfully, broadcasters and distributors are both strong.
LISTNUM 1 \l 16017 The CRTC should be wary of making important decisions based on only anticipated trends and consumer surveys and the cyclical problems of some broadcasters' business plans.
LISTNUM 1 \l 16018 We have presented a number of proposals here today that we think will provide a solid framework for the future. A strong analog service guarantees priority carriage for over‑the‑air broadcasters; provides broadcasters with full advertising flexibility, including product placement promotion and sponsorship opportunities; supports the benefits of time shifting through commercially negotiated arrangements; continues measures to support small system markets; looks at the Commission to see what they could do to remove the regulatory burden that is now placed on broadcasters, whether that is reporting on ‑‑ whether you have, what do you call it?
LISTNUM 1 \l 16019 MR. STEIN: Capacity.
LISTNUM 1 \l 16020 MR. SHAW: Capacity. We had capacity but logs and stuff like that. Is there a way that the Commission could make the load lighter rather than just look to the consumer?
LISTNUM 1 \l 16021 I'm sure there is somebody there that does that report that wouldn't be that happy with that idea.
LISTNUM 1 \l 16022 Collaboration between distributors and broadcasters to ensure an effective market and transition to digital, but only on the basis that the distributor will provide, and we will take up and do whatever we want with the signal, and they can provide it in any form.
LISTNUM 1 \l 16023 So if they want to stay analog, we are fine with analog; if they want to go to digital, we are fine with digital. If they want to work on HD, let's work on a business plan for HD.
LISTNUM 1 \l 16024 So we are very flexible there and we think that gives the ability for Canadians to have a maximum level of choice from the system today.
LISTNUM 1 \l 16025 One last comment. We love the TV business. As you know, Shaw was just able to purchase CJBN‑TV Kenora, Canada's newest superstation.
LISTNUM 1 \l 16026 Other small market stations are for sale, or maybe a network. We would ask them to please give us a call because we like the small markets. Serving over a hundred small markets now, we think that we have come up with a good plan to do it and we don't understand why they can't.
LISTNUM 1 \l 16027 With that, that ends my comments here today. Thank you very much.
LISTNUM 1 \l 16028 THE CHAIRPERSON: Thank you, Mr. Shaw.
LISTNUM 1 \l 16029 I will ask Commissioner Williams.
LISTNUM 1 \l 16030 COMMISSIONER WILLIAMS: Good morning, Mr. Shaw, gentlemen, Ms Rathwell.
LISTNUM 1 \l 16031 That's probably a good place to start, Mr. Shaw, with small market stations.
LISTNUM 1 \l 16032 You state in your submission that you do not support regulatory protections for large broadcast ownership groups with small market stations. You just said you would have some innovative solutions to challenges within the small market television industry.
LISTNUM 1 \l 16033 What measures do you consider would be appropriate to ensure these stations continue to fulfil their local programming obligations?
LISTNUM 1 \l 16034 MR. STEIN: I will start and I'm sure others will have some comments.
LISTNUM 1 \l 16035 We think that measures that we have put in place, as described by the small broadcasters ‑‑ I think they described it as a home run. We think that those measures are appropriate in terms of providing support in those areas.
LISTNUM 1 \l 16036 So I think where we have a concern primarily is when we get into excessive duplication.
LISTNUM 1 \l 16037 We think that the small broadcasters can make their own decisions, make their own investments in terms of serving the particular community. They may have in those areas substantive over‑the‑air audience, which is fine and appropriate, and where we deliver them we will make them available as part of the basic service on cable. And where we deliver them via satellite and they are linked up, then they will be made available.
LISTNUM 1 \l 16038 One of the options we would really like to explore much more is the omnibus channel because there is just excessive duplication. Looking at the omnibus channel and creative ways of advertising to support them I think would be appropriate.
LISTNUM 1 \l 16039 So far we haven't received a very positive response in that front, but that is what we would like to explore.
LISTNUM 1 \l 16040 COMMISSIONER WILLIAMS: Describe your omnibus channel proposal, please.
LISTNUM 1 \l 16041 MR. STEIN: Cynthia, do you want to take that?
LISTNUM 1 \l 16042 MS RATHWELL: Thank you.
LISTNUM 1 \l 16043 Our omnibus channel proposal would be that we would take local programming from each of the small market signals and compile it on one channel, much as the Commission envisioned in its decision regarding partial and omnibus channels that was issued to Bell ExpressVu.
LISTNUM 1 \l 16044 Ideally, we would like to negotiate those kinds of channels with broadcasters. Unfortunately, to date, we haven't sensed a great willingness on their behalf to afford any consent that would be necessary to arrive at those channels.
LISTNUM 1 \l 16045 We would be appreciative of any Commission support. We know that in the decision that was rendered on this already the Commission signified that it viewed it as an efficient and perhaps very good solution to the problem of duplication. And that is the kind of thing we would like as well.
LISTNUM 1 \l 16046 COMMISSIONER WILLIAMS: The broadcasters have recommended that all of their stations that originate programming should be carried on satellite in their entirety. The distribution of just their original programming would not be adequate, in their view.
LISTNUM 1 \l 16047 How much does it cost per year to distribute a typical local station by satellite in high definition across its market? And if you could include costs like the uplink costs, the transponder costs, receiver costs, just give us an idea of how much money is involved in this type of distribution.
LISTNUM 1 \l 16048 MR. D'AVELLA: I will start, Commissioner Williams. Thank you for your question.
LISTNUM 1 \l 16049 Right now I think we distribute about 73, including three HD broadcast television stations, on Star Choice. They occupy, I believe, about ten transponders.
LISTNUM 1 \l 16050 If we were to do all of them ‑‑ I think there are 124; that's the number we have heard in this hearing ‑‑ it would obviously require another anywhere from seven to eight transponders. And bear in mind that that is essentially standard definition.
LISTNUM 1 \l 16051 So when we move to HD, the greatest efficiency that we have been able to achieve on a transponder is essentially three per transponder, and the standard definition world is anywhere from eight to ten, depending on the content.
LISTNUM 1 \l 16052 So there simply isn't enough capacity. We don't have enough transponders. We don't own the satellite. We lease capacity from Telesat.
LISTNUM 1 \l 16053 Right now I think, Peter, we probably have one and a half transponders available probably for HD services. That is all incremental cost to us. They pay absolutely none of the costs associated with backhaul. They don't pay any of the transponder costs. It is all costs to Star Choice.
LISTNUM 1 \l 16054 MR. BISSONNETTE: And the reality also is whereas on the cable side we have the opportunity to continue to expand through upgrading and resizing our networks to provide for more services, with satellites, after the one and a half transponders are used up, there is no more capacity. The next capacity that will be available to us will be when there is a new satellite that is launched by Telesat.
LISTNUM 1 \l 16055 So we are continually looking at more creative ways of adding services that our customers really want, utilizing the capacity that we currently have in a more effective way ‑‑ and that's why omnibus really appeals to us; looking at different technological approaches to multiplexing, if you will, on transponders. We looking at 8‑QSB or 8‑PSK types of multiplexing to even use our existing transponders more effectively.
LISTNUM 1 \l 16056 So it is a continuous challenge. We just could not accommodate those additional local channels.
LISTNUM 1 \l 16057 We don't think that by providing those services that we really add more value to the system and to our customers, other than those that might be specifically in a discrete location within that community.
LISTNUM 1 \l 16058 MR. SHAW: I guess, Peter, it would be fair to say that we think that each transponder is about $20 million. So every time you add one to us, that is roughly our cost.
LISTNUM 1 \l 16059 You know, even right now, if we take TVA, we have nine channels up. Right?
LISTNUM 1 \l 16060 MR. BISSONNETTE: Yes.
LISTNUM 1 \l 16061 MR. SHAW: They are almost all duplicated and all for the Quebec region, which is only a certain part of Canada. We are glad to do that, but the duplication is so heavy. And you go and every channel has the same thing on. It just uses up all our space and we don't have any ability to offset that at all. So that is our issue.
LISTNUM 1 \l 16062 We are trying to be more efficient. We are not saying we won't show CBC. You might not get CBC Moose Jaw; you might get Regina or you might get Winnipeg. Maybe we could go by region and get a few.
LISTNUM 1 \l 16063 But the load is really heavy on this duplication. Every channel is the same except for the local news.
LISTNUM 1 \l 16064 What we were hoping is to just make a channel and we will put all the local news on it. We will just copy them all and put them all on, because that's Canadian programming. Then you can just tune to the channel and you can watch ‑‑ you know, we will do it by time zone and you can watch Toronto, then you can watch this. All the other programming is identical. You just take the network feed and move ahead.
LISTNUM 1 \l 16065 For us, it really just reduces our cost; maybe allows the ability for us to be a little more creative and do a few more things on a go forward basis.
LISTNUM 1 \l 16066 COMMISSIONER WILLIAMS: Thank you for your answers, gentlemen.
LISTNUM 1 \l 16067 In your written submission you propose a regulatory model that calls for replacement of the existing distribution framework with the simple preponderance rule: one basic requirement that distributors offer predominance of Canadian services to customers.
LISTNUM 1 \l 16068 Could you please elaborate on this concept. Are you proposing that a predominance of Canadian services would have to be offered but that subscribers could choose any combination of services they wanted, including one that might not include any Canadian services at all?
LISTNUM 1 \l 16069 MR. STEIN: Yes. What we are basically proposing is that we would have a basic ‑‑ whether it is analog or digital, there would be a basic package which would have all the priority carriage services: the CBCs, the local services. So that would be fundamentally a package that would be predominantly Canadian, quite frankly.
LISTNUM 1 \l 16070 Added to that we would also put on that basic package some of the channels that might currently be on tiers or on digital that we think would be particularly relevant to a good portion of the market.
LISTNUM 1 \l 16071 We still believe very strongly in the analog market. So we would like to make sure that the basic package is strong. That service for every consumer would be predominantly Canadian.
LISTNUM 1 \l 16072 In terms of packages, we do believe that people should be able to pick from the other services. They should be free to pick what services they wish, whether they are Canadian or international.
LISTNUM 1 \l 16073 We would think that on an overall basis, even if they picked a U.S. or foreign package ‑‑ and we would include in that things like Rye and BBC World. It is not limited to the U.S. services.
LISTNUM 1 \l 16074 But if they pick that, we still think that the overall package they would take would still be predominantly Canadian. But we would not require them to buy a strictly Canadian package.
LISTNUM 1 \l 16075 COMMISSIONER WILLIAMS: The first package that you described with the local signals and the Canadian services, and I imagine the 91H services, have you given any thought to what price point that would be offered at?
LISTNUM 1 \l 16076 MR. STEIN: Price point? The price point it would be offered at would be very similar to the price point we would offer it at now. We wouldn't see that shifting or changing.
LISTNUM 1 \l 16077 COMMISSIONER WILLIAMS: There would be no reductions or increases?
LISTNUM 1 \l 16078 MR. STEIN: No. It's popular now. We have been able to maintain our basic cable subscribers with that set of services by increasing value in that package and continuing to invest in the system.
LISTNUM 1 \l 16079 MR. SHAW: And we always have the market forces coming in to monitor us. As you know, satellite guys do different things. The black market guys come in and do different things.
LISTNUM 1 \l 16080 Our ability to continue to raise the rate is always a big subject at our firm when we go and say gee, we have 3,000 trucks right now. Well, when gas goes up three bucks or it goes up a buck, this is a big deal for us. Then of course everybody wouldn't mind getting the odd little wage increase, and stuff like that. So we have a lot of imbedded costs.
LISTNUM 1 \l 16081 We have 9,000 employees now and we are just trying to manage it. So there is a lot of that in there, Ken.
LISTNUM 1 \l 16082 We also have to be cognizant of the market.
LISTNUM 1 \l 16083 Peter, are we charging ‑‑ is it around 50 bucks? I can't remember, 40 bucks.
LISTNUM 1 \l 16084 MR. BISSONNETTE: The average is around $50, but that includes more services than just our basic services. Our basic services are priced at $23, $24.
LISTNUM 1 \l 16085 MR. SHAW: I'm talking about the seventy.
LISTNUM 1 \l 16086 MR. BISSONNETTE: Yes. So it is in that $49 for 70 channels.
LISTNUM 1 \l 16087 There is good value in there. The fact that 70 percent of our customers are quite happy to take an analog‑only service, bundled in some cases with our Internet or telephone services, really reflects the kind of value that they see in those services.
LISTNUM 1 \l 16088 COMMISSIONER WILLIAMS: Thank you.
LISTNUM 1 \l 16089 In your written submission, you state that Shaw believes the market, rather than regulatory mechanisms, is the most effective way of ensuring the production ‑‑
LISTNUM 1 \l 16090 This is in the area of Canadian programming.
"...ensuring the production, presentation and the amount of popular Canadian programming, but that the current reality is that the Canadian Television Fund is the major determinant of what Canadian programs are produced."
LISTNUM 1 \l 16091 If marketing is the most effective way of ensuring the protection of Canadian programming, why is there a need for the CTF? Why does the CTF exist?
LISTNUM 1 \l 16092 MR. SHAW: Don't everybody reach at once!
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16093 MR. SHAW: Our view of the CTF is that it is not a very effective organization, that it is basically ‑‑
LISTNUM 1 \l 16094 What do you call it on the farm when you have a big thing and everybody goes and eats there?
‑‑‑ Pause
LISTNUM 1 \l 16095 MR. SHAW: Okay. I won't call it that.
LISTNUM 1 \l 16096 I think that when we look at it, it has shown that it hasn't been that effective, even though our company this year will pay $56 million ‑‑ this year alone ‑‑ and, yet, they are having a hard time figuring out how to get us ‑‑ our satellite guys can't get a Board seat to help make a decision.
LISTNUM 1 \l 16097 It is really ineffective. When you have 25 Board members, you can't run anything effectively, I wouldn't care what it was.
LISTNUM 1 \l 16098 I think that, when you look at it, it is another thing that needs to be revamped. It might be more of an overall government issue, but, certainly, when the CBC is allowed to go in and take, automatically, 37 percent ‑‑ what for?
LISTNUM 1 \l 16099 Why is that? Why is that not a decision?
LISTNUM 1 \l 16100 Do I get an automatic right to go there? I don't.
LISTNUM 1 \l 16101 I get an automatic right to do what? I get an automatic right to pay.
LISTNUM 1 \l 16102 The only thing they ever call us about ‑‑ and they have never called me. They call Peter, I guess. I said to them: We are the largest payer in there, and yet the chairman has never even bothered to phone me once since its inception, about anything. "What do you think?" "How is it doing, Jim?" "Do you have any opinions?" "Are we doing a good job; not doing a good job?"
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16103 MR. SHAW: I get judged quarter‑over‑quarter at Shaw Communications, and I can tell you that some quarters ain't that great and I get in trouble.
LISTNUM 1 \l 16104 What is the process, and what do they do with it?
LISTNUM 1 \l 16105 We are not here recommending solutions, but we do see it as not as helpful as everyone would think.
LISTNUM 1 \l 16106 COMMISSIONER WILLIAMS: As you know, Mr. Shaw, the CRTC has no involvement in how the Canadian Television Fund operates, but we do play a significant role in its funding.
LISTNUM 1 \l 16107 Could you explain why the way the CTF is funded should be re‑examined? And what changes would you propose?
LISTNUM 1 \l 16108 How can we fix this organization that, in your opinion, isn't as effective as it could be?
LISTNUM 1 \l 16109 MR. STEIN: This started with the cable industry's proposals in the early nineties, because it was felt that there was a recognition, as we developed new programming services, that we would need to invest not only in the capital expenditures that we would have to make, in terms of our distribution systems, but that we would have to make investments in the development of content.
LISTNUM 1 \l 16110 The original idea was that this would be an investment in the development of Canadian programming.
LISTNUM 1 \l 16111 Our concern, over the past number of years, has been that it is not really looked at as an investment vehicle, but much more as a vehicle to take care of special interests, and to be able to allocate funding on an ‑‑ I hate to say it ‑‑ envelope basis ‑‑ the CBC is entitled to so much ‑‑ and that winning programming, like children's programming, for example, has actually been on the decline.
LISTNUM 1 \l 16112 As well, since 1999, when the expenditure requirements were changed, it is obvious that there has been a flat line in terms of Canadian programming investment.
LISTNUM 1 \l 16113 We feel that the original intent of the fund, which was to invest in Canadian programming, to make it worldwide competitive, to put it on a sustainable basis, has clearly been an abject failure.
LISTNUM 1 \l 16114 Our changes would be: to run it more as a fund; to run it as an investment vehicle.
LISTNUM 1 \l 16115 That is what the world's broadcasting is all about. It is a very competitive environment for distributors and broadcasters, and we think that investment in programming should be treated the same way.
LISTNUM 1 \l 16116 We think that, in any industry you look at, the fact that it has to be competitive, that it has to exist without subsidies, that always strengthens the industry.
LISTNUM 1 \l 16117 A perfect example is western Canada's transportation system. We used to have lots of subsidies, and the subsidies, under a variety of governments, were eliminated, which led to a tremendous strengthening of the transportation industry, and tremendous benefits for the economy of western Canada.
LISTNUM 1 \l 16118 I think the example holds: that excessive regulation, excessive attention to allocating on an entitlement basis, is not the way to develop an industry.
LISTNUM 1 \l 16119 That is our view.
LISTNUM 1 \l 16120 COMMISSIONER WILLIAMS: Thank you, Mr. Stein.
LISTNUM 1 \l 16121 In the area of time shifting to Fee for Carriage, in your written submission you state that the provision of time‑shifted signals is beneficial to Canadian consumers, and the Canadian broadcasting system generally, as it increases the windows for viewing Canadian programming, it encourages Canadians to adopt digital technologies, and it encourages consumers to remain within the broadcasting system, rather than choosing non‑regulated options.
LISTNUM 1 \l 16122 The time shifting of Canadian over‑the‑air stations has been a significant selling point for DTH operations, such as the one you have, in attracting subscribers to the service.
LISTNUM 1 \l 16123 Why should over‑the‑air licensees be able to negotiate with DTH for the use of their distant signals?
LISTNUM 1 \l 16124 There was a proposal put forward that they would like the ability to withdraw their consent for carriage to help the negotiating process go along.
LISTNUM 1 \l 16125 Could I have your comments on that, please?
LISTNUM 1 \l 16126 MR. STEIN: First of all, the reason time shifting developed was because people demanded that we carry their signals. So the whole basis, as it evolved, on DTH was this magical development, where we started putting these signals up, and people started saying: Wow! This is terrific. I can watch this show at this time.
LISTNUM 1 \l 16127 I noticed in one of the surveys, though, that one of the advantages people saw in time shifting was watching sports earlier. I guess you could watch your hockey game an hour earlier ‑‑ before it started.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16128 MR. STEINS: You could get the result early, too.
LISTNUM 1 \l 16129 Consumers like it. Its advantages are there for people now, and it is a double advantage. One is that signals get lifted up and they get carried, and they are on the satellite; and, aside from the excessive duplication, the fact that people can choose when to watch it is advantageous.
LISTNUM 1 \l 16130 I think the surprise to us was when a broadcaster said that it wasn't of value to them, the fact that people had increased windows to watch their programs. We thought that that was a tremendous value.
LISTNUM 1 \l 16131 In any event, we were willing to negotiate with them, and we did come to a negotiation ‑‑ a commercial negotiation ‑‑ as to the carriage of their signals, and that's the way it is at the moment.
LISTNUM 1 \l 16132 MR. SHAW: I have to say that one of the main things that we find on time shifting ‑‑ and we recently started it on the cable system, because we were at such a disadvantage to all of the other providers.
LISTNUM 1 \l 16133 I think, Peter, that happened within a month or two.
LISTNUM 1 \l 16134 I think the commercial rate negotiation has gone very well, so I don't think you should be concerned about that. It is no different from any other signal we have, and any other supplier relationship, and provider relationship.
LISTNUM 1 \l 16135 We have always been able to come to some deal. You have the dispute mechanism, if that goes the wrong way down the road, and you can get involved, if you guys want, or not.
LISTNUM 1 \l 16136 We think that it is a natural progression.
LISTNUM 1 \l 16137 The one thing that is really hard for us is that Canadians love it. Other than, when you go through all of the CBC, if you get the wrong time shift and you get a whole bunch of the same programming, they don't like that, but they do like being able to watch ‑‑ I always get these numbers mixed up ‑‑ CFTO, and then Winnipeg, and then you can watch Regina ‑‑
LISTNUM 1 \l 16138 I don't know about you, but I am having a hard time staying up past 10 at night.
LISTNUM 1 \l 16139 I am waiting for the 11 o'clock CTV news in Calgary, and I can barely make it.
LISTNUM 1 \l 16140 And I am not the biggest CBC fan, because that channel seems a bit different to me.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16141 MR. SHAW: I do like to watch some news, and I can hardly make it. I am up really early in the morning, but I can't make it ‑‑ midnight is a stretch.
LISTNUM 1 \l 16142 MR. BISSONNETTE: Jim, let's not forget that five, six or seven years ago, when people thought of satellite, they thought of black market satellite, and they thought of the advantages that black market satellite provided to them, which was time shifting, the ability to look at services at different times of the day, to look at prime time kind of programming.
LISTNUM 1 \l 16143 We have now provided a product where there is no difference, if you will, in terms of the advantages that our customers, who happen to be DTH customers, will experience between the services we provide and those services that the black market might provide.
LISTNUM 1 \l 16144 The one advantage, I guess, is that the black market is free.
LISTNUM 1 \l 16145 But the fact is, in terms of programming, we have a very, very compelling series of programs that are available to our customers.
LISTNUM 1 \l 16146 As Ken said, when we weren't carrying some of the distant signals, we were written to by the broadcasters, saying: Why aren't you carrying my services?
LISTNUM 1 \l 16147 When we launched high definition television, we were asked: Why aren't you carrying CFTO? You have to carry CFTO.
LISTNUM 1 \l 16148 It is a compelling service, and based on the compelling service, we agreed that it would make a nice tuck‑in, if you will, with our other HD services on Star Choice, and now on our cable services.
LISTNUM 1 \l 16149 So the broadcasters have expressed the desire to be carried, and you don't express a desire to do something if it is hurting you.
LISTNUM 1 \l 16150 MR. FERRAS: I would add, in terms of the negotiation, that I think it is our full expectation, and we are fully committed to having a very good negotiation with the broadcasters.
LISTNUM 1 \l 16151 As you know, we didn't really have that opportunity ‑‑ no one in the industry did ‑‑ because the agreements expired in August of last summer. Then we went into this policy proceeding, and we hope to take guidance from the Commission and from the record, in terms of policy, go away and meet the broadcasters, and really sit down and work hard and try to come to a solution.
LISTNUM 1 \l 16152 Our perspective is going to be that time shifting is really valuable for the system. It keeps Canadians plugged into the broadcasting system, to the regulated platform, and that has to be good for everybody.
LISTNUM 1 \l 16153 That is our intention. We are here to listen and to participate, and we really want to take your guidance and then go and sit down with the broadcasters.
LISTNUM 1 \l 16154 MR. D'AVELLA: Just one final comment on that subject. We don't know any broadcaster or programmer who is looking for less carriage. They all want more carriage. And they are not homogenous enterprises. We are dealing with companies, some of which own 33 specialty services.
LISTNUM 1 \l 16155 So they are all interested in: What is the big deal? Give me more carriage of this, and a trade‑off for that.
LISTNUM 1 \l 16156 As Michael points out, these are all commercial negotiations that we are quite comfortable entering into, and we are very confident that we can get a deal done.
LISTNUM 1 \l 16157 COMMISSIONER WILLIAMS: Thank you.
LISTNUM 1 \l 16158 You also state that specialty and pay television services do not transmit free over the air, and, thus, consumers understand and accept the logic of an associated fee.
LISTNUM 1 \l 16159 However, the signals of Canadian television stations are available to customers free over the air. Canadians will resent and resist being forced to pay for these signals, and many will find alternative sources of programming.
LISTNUM 1 \l 16160 Describe the scenario. Would subscribers in Winnipeg not accept the logic of a fee associated with the DTH carriage of stations from Vancouver and Halifax, since these stations cannot be received over the air in Manitoba?
LISTNUM 1 \l 16161 I would ask you to elaborate a bit on that answer to describe what you view the customer/subscriber reaction would be to such fees being introduced.
LISTNUM 1 \l 16162 MR. SHAW: Currently, we use it as a digital promotion, to enhance digital, to expand the capacity across the network.
LISTNUM 1 \l 16163 Basically, most of these ‑‑ Peter ‑‑ are available at no cost. Right?
LISTNUM 1 \l 16164 That is basically it. No one is paying for it now. It is the same way we do it with the music channels. The Guide you get for free, to try and promote access to digital, which is good for us, but also good for all of the other networks that are on the digital capacity ‑‑ or in the digital category. And you have seen them go up.
LISTNUM 1 \l 16165 But what happens ‑‑ it is funny, with a subscriber, when you say ‑‑ let's see if I can think of a good example.
LISTNUM 1 \l 16166 If I went to you every day and I said, "You got 5 bucks?" and then I went to the next person and said, "You got 5 bucks?" you would say, "I'm not giving you 5 bucks."
LISTNUM 1 \l 16167 What did I get?
LISTNUM 1 \l 16168 If the answer is nothing ‑‑ and maybe a time shift is good from a consumer point of view ‑‑ the answer is nothing.
LISTNUM 1 \l 16169 The subscriber, I mean they go crazy. Like you should see the calls I get. I mean, they would make the e‑mails to the Commission look mild. I mean, you can't even believe it.
LISTNUM 1 \l 16170 By the time they get to me, it's like full‑out war. As I say, when we hurt a subscriber, we really hurt him. We knife him and hurt him and knife him and hurt him.
LISTNUM 1 \l 16171 But when you practically look at it, we have to hang our hat in our group on value and that is why we are so adamant about it that it doesn't provide any value to any Canadian and no one will understand.
LISTNUM 1 \l 16172 The same way if I try to describe to a consumer how simultaneous substitution works, it's just like you might as well have glazed in the globe because no one can figure it out, and no one wants it. They say, "Why do we have to do it?" Then I explain the reason why we have to do it.
LISTNUM 1 \l 16173 I guess those are the benefits they have, but right now, even on the simulcast, I don't know if there is a lot of value that you can go and say, "Yes, here, give me a buck or two bucks" and that kind of thing.
LISTNUM 1 \l 16174 COMMISSIONER WILLIAMS: Thank you.
LISTNUM 1 \l 16175 We will move into the area of transition to digital.
LISTNUM 1 \l 16176 In your written submission you state that:
"Fee for carriage or any other economic reward should not be linked with making the decision to broadcast in digital or offer HD programming. These are investments that broadcasters will need to incur to operate in a competitive digital world and they should not be subsidized by cable or DTH customers." (As read)
LISTNUM 1 \l 16177 In Public Notice 1993‑74 announcing its determinations pursuant to the structural public hearing, the Commission considered it reasonable that cable subscribers should bear a portion of the capital costs of implementing digital video compression, DVC, and universal addressability and to allow a portion of DVC and addressability related expenditures to be eligible for the purposes of cable operators, capital expenditure fee increases.
LISTNUM 1 \l 16178 Could it not be argued that programming services should be given the same sort of assistance that cable licensees have received in the past?
LISTNUM 1 \l 16179 MR. SHAW: Why don't I start, and then we will go ‑‑ I'm sure the boys have a bit of a comment.
LISTNUM 1 \l 16180 You know, when we go ‑‑ and I will just try to remember our capital.
LISTNUM 1 \l 16181 So four years ago it was $850 million; three years ago I'm thinking $460 million ‑‑ Peter, around there?
LISTNUM 1 \l 16182 MR. BISSONNETTE: Yes.
LISTNUM 1 \l 16183 MR. SHAW: Yes. And last year was $530 million, and this year going to $630 million a year. I mean, we are supporting and a lot of these channels have carried at no cost. We support all the uplinking, we do all this stuff. For someone to argue that Jimmy Pattison, who is one of the richest guys in Canada, can't afford to upgrade Kamloops, I just find that ‑‑ like I don't understand.
LISTNUM 1 \l 16184 Some of these guys, they are really successful guys and they are going, "Well, you don't got $10 million or $5 million or something and we are spending hundreds." We are just trying to keep the well shut.
LISTNUM 1 \l 16185 In cable TV my father always said, it's just a license to spend money. He said, we are just waiting to the day we get to make some.
LISTNUM 1 \l 16186 So, I mean, we are coming, but there are a lot of requirements on the system and on us for capacity.
LISTNUM 1 \l 16187 You know, we have to put on all the French channels as soon as we hit ‑‑ I don't know, what is it, eight‑something, 750. We have French channels that they have 40 customers ‑‑ 40, and they are on every network we have?
LISTNUM 1 \l 16188 So the burden on us is a lot to keep all this stuff going. So for a guy to come and argue that you couldn't afford to go and spend a little bit on your business, I have to say: You know what, you should maybe get out. I guess maybe they will phone us to sell.
LISTNUM 1 \l 16189 MR. BISSONNETTE: Jim, just to put it in context, we have heard numbers bandied around in terms of what it costs to move a transmitter from an analog to digital or to high definition.
LISTNUM 1 \l 16190 Given that there is even sufficient transponder space available, we are looking over the next five to 10 years what Shaw will have to invest, just in our satellite business, to provide high definition television to those broadcasters who will want to have high definition television distribution, and it is in the order of $775 million.
LISTNUM 1 \l 16191 $775 million; that is a lot of $10 a months.
LISTNUM 1 \l 16192 MR. STEIN: A comment I would like to make on it is that I found it interesting Mr. Brace's comments about the costs for CTV of about $46 million. They are willing to pay $1.7 billion for CHUM and they don't have $46 million to invest in going to HD? That would seem to me to be not a very good kind of way to put the number.
LISTNUM 1 \l 16193 I think we are spending $630 million in capital in the coming year, just as Jim says, to keep the well closed. So these are the investments that one has to make.
LISTNUM 1 \l 16194 In the high technology business, if you are a transmitter, if you are trying to depend on towers that last 20 years, that is just not the way this business is going to develop over the next 10‑15 years. There are going to be a lot of changes and everybody is going to have to make those kinds of investments, and they are going to have to make those kinds of investments in a competitive marketplace.
LISTNUM 1 \l 16195 So that's the way we see that this has to develop.
LISTNUM 1 \l 16196 COMMISSIONER WILLIAMS: All right. Thank you very much, Mr. Shaw and your panel members. That completes my line of questioning.
LISTNUM 1 \l 16197 Vice‑Chair Arpin...?
LISTNUM 1 \l 16198 THE CHAIRPERSON: Yes.
LISTNUM 1 \l 16199 Vice‑Chair French...?
LISTNUM 1 \l 16200 COMMISSIONER FRENCH: I guess this is a question for Mr. Shaw.
LISTNUM 1 \l 16201 There were 17 very small market broadcasters came to see us yesterday or the day before and one of the things they asked us to do was to eliminate the benefits policy for transfers of property where the broadcasting property's revenues were less than $10 million a year.
LISTNUM 1 \l 16202 If we did that, would that stimulate that market? Would it be the kind of market you might be interested in absorbing?
LISTNUM 1 \l 16203 MR. SHAW: You know, listen, I think our main point is that we are a large operator of small markets, right, and we have been very successful at deploying and building.
LISTNUM 1 \l 16204 So it's just we don't agree with the argument that you have no money, you can't convert, your system is in dire needs when all you do is local news that looks like community programming, you know, you have two anchors and one truck and four cameramen or something. I mean, we just don't agree with that argument.
LISTNUM 1 \l 16205 We go and say, "You know what, if you don't like that business, call."
LISTNUM 1 \l 16206 COMMISSIONER FRENCH: If we remove the benefits policy there would be more sellers and you might be a buyer?
LISTNUM 1 \l 16207 MR. SHAW: I think all you would see is there might be a little quicker consolidation. There will be consolidation across every line, no different than you see now with even telephony. There are only really two large telcos. Cablecos, there are only really three or four.
LISTNUM 1 \l 16208 You will just see a quicker consolidation where you will have, you know, Hildebrand buying them up or one of these guys, or maybe Shaw.
LISTNUM 1 \l 16209 COMMISSIONER FRENCH: I don't know if this is for you, Mr. Shaw, or not. You said there is a growing black market satellite problem.
LISTNUM 1 \l 16210 Do you have evidence and could you share it with us?
LISTNUM 1 \l 16211 MR. SHAW: Well, I don't know if we have it or not with us, but what we are seeing is a continued response from our customers. As you know, cable penetration has dropped. I think Mr. Rogers was here yesterday saying they are down 5 to 8 percent. I think we are down in that similar kind of range across the board.
LISTNUM 1 \l 16212 What is happening is that when ‑‑ maybe some of you go to Florida, maybe some of you go to California and some go to Arizona, that you have access to all these different channels, and when people come back they want them. So the only way to get them is to really take them.
LISTNUM 1 \l 16213 Now, some might pay and some might not pay, that's a different issue, but we are seeing greater pressure on us to provide everything everybody wants and then we just have to come up with how we can support the Canadian broadcasting system with that.
LISTNUM 1 \l 16214 But we are seeing a huge demand for I want, I don't know, Comedy Central, or I want, you know, Hokey‑Pokey, HBO or whatever channel.
LISTNUM 1 \l 16215 You know what, people are not as patient as they used to be. They are asking us all the time for this stuff.
LISTNUM 1 \l 16216 I'm not making a pitch for it, I'm just saying that there is a lot of pressure from general consumers that go "Why do I have to steal?" I don't have an answer. I can't offer it. What do we do?
LISTNUM 1 \l 16217 MR. BISSONNETTE: And there is evidence. In the last two weeks ‑‑ and we have worked with our other satellite competitor in this area because it is mutually beneficial to all of us, whether in the cable industry or in the satellite industry, to do something to prevent the growing black market.
LISTNUM 1 \l 16218 In the last two weeks we know that there was a coordinated bust taking place in Ontario where one satellite retailer of black market devices was arrested. All of his inventory was seized, his records were seized, and his records reflected in the most recent year how many people he has been selling black market devices to.
LISTNUM 1 \l 16219 And we know it's going on. We see if you just go to the internet and you look under some of the Bluebird/Blackbird types of devices, the number of retailers or the number of private people who are actually selling software to activate those devices continues to grow.
LISTNUM 1 \l 16220 MR. SHAW: I think if you look in Toronto, if we go to the Yellow Pages and we look under "satellite", I think we counted like 250 guys selling them. And it won't be any different in Toronto than it is in Calgary or Vancouver or Ottawa or anywhere.
LISTNUM 1 \l 16221 COMMISSIONER FRENCH: I don't think anyone contests that it exists. I was just interested ‑‑ I appreciate the anecdotal evidence, but I underline it is anecdotal ‑‑ that it is actually growing. And you believe it is and you are well‑placed to make that judgment and I appreciate it.
LISTNUM 1 \l 16222 It is very hard always for the Commission, and for broadcasters and for distributors to have concrete data and anything you have of course would be valuable.
LISTNUM 1 \l 16223 But it is your contention or your experience and interpretation of that experience that this is a "growing problem"?
LISTNUM 1 \l 16224 MR. STEIN: Well, you know, Mr. French, with all respect, over the last number of years we have filed all kinds of evidence about this problem. We have worked with the Motion Pictures Distributors Association and we have worked with the RCMP, we have done surveys, we have spent hundreds of thousands of dollars with evidence.
LISTNUM 1 \l 16225 The federal government hasn't acted, the Commission says it's not your jurisdiction, so we are left on our own, totally on our own to deal with the problem.
LISTNUM 1 \l 16226 The thing is, Mike can talk about some of the latest kind of events in terms of it growing, it is very hard to get enforcement under the current set of laws. It is very easy to get access to the system, it is very easy to hack some of the systems that are out there.
LISTNUM 1 \l 16227 We at Shaw have invested in Star Choice in a more expensive technology to make sure it couldn't be hacked, but we can't realize the advantages of that because we are still competing against the black market.
LISTNUM 1 \l 16228 We could do a survey every month to put the evidence on the table, but the evidence we have put on the table in the past hasn't led to action to deal with this problem, as contrary to the kind of actions that have been taken in the United States.
LISTNUM 1 \l 16229 Mike may want to give you some more information about what is happening.
LISTNUM 1 \l 16230 MR. FERRAS: Just quickly, I agree with everything that has been said, but I guess the point we want to make is just to understand that the problem has changed. It used to be you would go and take a satellite receiver and you would ship it or you would have a grey address. That problem, there has been great work done in the industry by our industry partners in the U.S. As Ken mentioned, we work very closely with the RCMP across the country and Canadian Motion Pictures Distributors Association, DirectTV has fixed their system.
LISTNUM 1 \l 16231 The new problem is the one that Peter talked about, which is the free‑to‑air problem where you can go and buy this box illegally that is meant to pick up satellite signals that are in the clear. There are still a few of those out there.
LISTNUM 1 \l 16232 But that box could be sold and imported with no problem whatsoever, because until it is modified it is legal. And it so easy to modify now, you just hook it up to your internet ‑‑ hook your internet into it, bang you get it, and you get all the satellite services from two major providers.
LISTNUM 1 \l 16233 Evidence is always anecdotal. It is really hard to say, "Well, the problem has gone from this much to this much, but the people that we deal with all the time on this say this is going to be bigger than the old black market problem ever was unless something is done.
LISTNUM 1 \l 16234 COMMISSIONER FRENCH: I just equally, respectfully to Mr. Stein, it is not the testimony of all the participants in this proceeding that this is a growing problem. This is the first time we have heard that it is a growing problem.
LISTNUM 1 \l 16235 We realize it is a large problem, a troubling problem, there is an enforcement issue. Other people have said this problem seems to have levelled off. I'm just giving you an opportunity to expand on your view that it is growing and I appreciate that you have done that.
LISTNUM 1 \l 16236 Thank you, Mr. Chairman.
LISTNUM 1 \l 16237 THE CHAIRPERSON: I want to come back to narrow your question that Commissioner Williams asked of Mr. D'Avella and Mr. Bissonnette and it has to do with regard to cost comparison.
LISTNUM 1 \l 16238 What we are really looking for is regarding the cost of a satellite carriage of an analog over‑the‑air signal versus the carriage of a similar over‑the‑air station but with an HD signal.
LISTNUM 1 \l 16239 You referred to the fact that only opening up a new transponder cost $20 million, but we are trying to get some information regarding a more narrow situation of what are the uplink costs of an analog service versus an HD signal transponder cost and receiving cost.
LISTNUM 1 \l 16240 MR. D'AVELLA: Well, the cost of the transponder doesn't change, it is our ability to put programming on that transponder in a standard definition form ‑‑ in satellite it's all digital ‑‑ we can compress it eight‑to‑one, so we can provide eight programming services on a single transponder.
LISTNUM 1 \l 16241 In the HD world, the current state‑of‑the‑art is two. we can provide two HD signals on that single transponder.
LISTNUM 1 \l 16242 There are technologies that will allow us to take it to possibly three services on a single transponder, so you could look at it in the sense of it is three times the cost to do HD.
LISTNUM 1 \l 16243 It also costs more money to backhaul, simply because of the fact that this is not a broader service with more information on it. I mean, we have fibre networks in place that allow us to do this.
LISTNUM 1 \l 16244 In all the HD deals that we have done, whether they are broadcast services or other types of services, we typically pay the cost of backhauling the service to an uplink. That is the way the market is kind of unfolding here.
‑‑‑ Pause
LISTNUM 1 \l 16245 MR. D'AVELLA: Peter is asking me a question.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16246 MR. D'AVELLA: Well, the operating cost on the transponder, I think it is in the order of about $2 million a year on a per‑transponder basis, but that is in addition to the capital we have already committed to buy it.
LISTNUM 1 \l 16247 On the consumer side, on the receiver side, I think the cost of our satellite receivers is typically in that ‑‑ the HD receivers is typically in that $300 to $500 range, depending on whether it has a PBR or not.
LISTNUM 1 \l 16248 THE CHAIRPERSON: I don't know if you were following the hearing at the beginning of the week, but the cablecos that are involved with the operation of TVA and TQS are supporting a fee for carriage.
LISTNUM 1 \l 16249 Since you are operating Star Choice and you are delivering francophone signals throughout Québec, do you have different views regarding fee for carriage for the Québec market, or the one that you have expressed so far applies also for the French market?
LISTNUM 1 \l 16250 MR. SHAW: It did make us think it looked a bit self‑serving if you owned both and then you wanted one fee to just go from ‑‑ what's that commercial where they all jump up and they go ‑‑ somebody's got their hand in your pocket, this kind of hand in your pocket, hand in your pocket. You have seen that commercial. It did look a little bit like that to us. We didn't see a lot of benefit out of doing it.
LISTNUM 1 \l 16251 We certainly carry all those markets. We have a big operation in Montréal and we are supportive of that, but we still feel that there is no subscriber, no Canadian benefit to have that fee in there.
LISTNUM 1 \l 16252 THE CHAIRPERSON: Mr. Shaw, Mr. Bissonnette, Mr. Stein and the team, I want to thank you on behalf of the Commission.
LISTNUM 1 \l 16253 We will take a 15‑minute break.
LISTNUM 1 \l 16254 MR. SHAW: Super. Well, thank you.
LISTNUM 1 \l 16255 We are very positive about the future and the direction you guys are doing. So thank you very much.
‑‑‑ Upon recessing at 0923 / Suspension à 0923
‑‑‑ Upon resuming at 0952 / Reprise à 0952
LISTNUM 1 \l 16256 THE CHAIRPERSON: Order, please. A l'ordre, s'il vous plaît.
LISTNUM 1 \l 16257 Madame la Secrétaire ?
LISTNUM 1 \l 16258 THE SECRETARY: Merci, Monsieur le Président.
LISTNUM 1 \l 16259 We are now ready to proceed with our next presentation of Bell Canada. Mr. Gary Smith will introduce his colleagues. After which, you will have 15 minutes for your presentation.
LISTNUM 1 \l 16260 Mr. Smith?
PRESENTATION / PRÉSENTATION
LISTNUM 1 \l 16261 MR SMITH: Thank you, and good day, Chairperson Arpin, Vice‑Chairperson French and Commissioners.
LISTNUM 1 \l 16262 My name is Gary Smith and I am the President of the Bell Video Group, which comprises Bell ExpressVu, our DTH platform and Bell IPTV, our terrestrial broadcasting distribution undertaking.
LISTNUM 1 \l 16263 Joining me today, on my left, are Chris Frank, Vice‑President of Programming; Barry Kiefl, President of Canadian Media Research; and on my right, David Elder, Vice‑President of Regulatory Law.
LISTNUM 1 \l 16264 Bell appreciates the opportunity to participate in this important review of the regulatory framework for over‑the‑air television.
LISTNUM 1 \l 16265 We will focus today on three key issues:
LISTNUM 1 \l 16266 First, the proposal for a fee‑for‑carriage regime;
LISTNUM 1 \l 16267 Second, the impact of distant signals;
LISTNUM 1 \l 16268 And finally, the transition to over‑the‑air digital and HD transmission.
LISTNUM 1 \l 16269 We will explain to the Commission why we feel that the broadcasters do not have a case for increased funding, and why if would be inappropriate to implement fee‑for‑carriage.
LISTNUM 1 \l 16270 With regard to distant signals, we submit that the problem is not only overstated and dramatised, but also has already been dealt with satisfactorily such that no new provisions are needed.
LISTNUM 1 \l 16271 Finally we will confirm Bell's support for the hybrid distribution models suggested by several broadcasters, and that we are prepared to assume a contributing role in this respect.
LISTNUM 1 \l 16272 Turning first to fee‑for‑carriage, there are compelling reasons to reject such a regime.
LISTNUM 1 \l 16273 First, broadcasters have failed to prove that a problem actually exists. Indeed, the evidence suggests otherwise.
LISTNUM 1 \l 16274 We have no reason to dispute the broadcasters' claim that growth in advertising spent on conventional channels is slowing, but we would note that these dollars are moving primarily to the specialty channels, where advertising revenues have increased 318 per cent since 1997.
LISTNUM 1 \l 16275 Most, if not all, of the broadcasters seeking fee‑for‑carriage are already benefiting from this shift through their ownership interests in specialty and pay services.
LISTNUM 1 \l 16276 In any event, the chart in your hand‑out reveals that broadcaster PBITs for conventional services have remained consistent over the last six years and are themselves reasonably healthy, averaging 12 per cent annually.
LISTNUM 1 \l 16277 These are hardly businesses in dire need, as they would have you believe.
LISTNUM 1 \l 16278 No doubt the marketplace will continue to yield shifts in fortune between different services and between competitive broadcasters.
LISTNUM 1 \l 16279 Good and bad business decisions have been made by the broadcasters regarding such factors as their acquisitions of Canadian and U.S. programming, diversification into specialty and pay services, and the development of Internet‑based initiatives.
LISTNUM 1 \l 16280 Some have even diversified outside of broadcasting and outside of Canada. These decisions have inevitably impacted individual broadcaster profitability, yielding winners and losers.
LISTNUM 1 \l 16281 Nevertheless, the profitability of the group of broadcasters in aggregate has proven reasonably consistent over these last few years.
LISTNUM 1 \l 16282 Further evidence of the health of these businesses is the significant interest in station start‑ups and acquisitions.
LISTNUM 1 \l 16283 Conventional over‑the‑air TV programming undertakings have been added to the Vancouver and Toronto markets.
LISTNUM 1 \l 16284 CanWest MediaWorks is one of the five applicants currently vying for a broadcasting licence to serve the markets of Calgary and/or Edmonton.
LISTNUM 1 \l 16285 CHUM acquired the broadcast properties of Craig Broadcasting Systems prior to being acquired itself by Bell Globemedia.
LISTNUM 1 \l 16286 Most recently, Shaw Communications has acquired CJBN‑TV in Kenora, Ontario.
LISTNUM 1 \l 16287 Not only is there no problem to solve here, but in fact, this is a healthy industry sector worthy of investment.
LISTNUM 1 \l 16288 It is clear that the broadcasters have been evolving their businesses to meet the changes in their current business environment.
LISTNUM 1 \l 16289 For example, they have begun ad‑supported Internet content initiatives intended to exploit the revenue opportunity that this presents.
LISTNUM 1 \l 16290 CTV's recently‑launched Broadband Network is a great example.
LISTNUM 1 \l 16291 It is, in the words of its CEO Ivan Fecan:
"...part one of CTV's answer to Canadian's appetite to tap programming on emerging platforms and to provide a solution to the advertisers who want to reach them." (As read)
LISTNUM 1 \l 16292 CanWest MediaWorks has also launched its own online presence, featuring exclusive, ad‑supported on‑demand content.
LISTNUM 1 \l 16293 These early forays into online ventures continue the pattern of profitable diversification established by these broadcasters, first demonstrated via their expansion into pay and specialty.
LISTNUM 1 \l 16294 Moreover, the fee‑for‑carriage proposal itself would be bad for consumers, harmful to BDUs and would establish a damaging precedent for the industry.
LISTNUM 1 \l 16295 To ask consumers to pay a tax to receive services that they already receive is certain to be unpopular. The broadcasters' proposed fees are all over the map.
LISTNUM 1 \l 16296 However, it is clear that the aggregate fee to be faced by consumers could be significant.
LISTNUM 1 \l 16297 Consumers would react to the increase by scaling back on the number of pay and specialty service packages to which they subscribe.
LISTNUM 1 \l 16298 As well, Canadian BDUs would inevitably face subscriber losses, as we know that all price increases cause churn and a price increase with no added value such as this would be a particularly serious customer irritant.
LISTNUM 1 \l 16299 The BDUs' role is also badly misrepresented by the broadcasters in this debate.
LISTNUM 1 \l 16300 They have suggested that BDUs are getting a free ride here.
LISTNUM 1 \l 16301 This is simply untrue.
LISTNUM 1 \l 16302 Bell incurs significant expense in the acquisition and distribution of conventional over‑the‑air signals.
LISTNUM 1 \l 16303 These costs cover backhaul, signal processing, uplink and transponder costs.
LISTNUM 1 \l 16304 As you will have observed from the chart on page 3 of this statement, we are less profitable than the broadcasters who are asking that we subsidise them.
LISTNUM 1 \l 16305 We simply cannot afford to absorb a fee‑for‑carriage and would, without any doubt whatsoever, be forced to pass it on to our customers.
LISTNUM 1 \l 16306 In this debate, the broadcasters conveniently ignore the many benefits that DTH brings to them.
LISTNUM 1 \l 16307 Signal quality is enhanced significantly, while coverage is extended to many more markets, both urban and rural.
LISTNUM 1 \l 16308 Additional value is afforded those conventional broadcasters who own pay and specialty services, whose distribution benefits in the same way.
LISTNUM 1 \l 16309 Finally, in respect of fee for carriage, we submit that the proposal, if accepted, would establish an unhealthy precedent.
LISTNUM 1 \l 16310 The broadcasters would inevitably come to rely on this tax, a purely regulatory fix, in support of their bottom lines.
LISTNUM 1 \l 16311 Such a tax would be susceptible to regular requests for a rate increase, having become an entrenched and accepted component of their business planning.
LISTNUM 1 \l 16312 Fee‑for‑carriage income would also reduce their incentive to innovate in response to technological and competitive pressures.
LISTNUM 1 \l 16313 Furthermore, the U.S. is also serious about fee‑for‑carriage. U.S. broadcasters want to receive fees from Canadian BDUs for the carriage of their local signals to Canadian households.
LISTNUM 1 \l 16314 Canada has been debating an opt‑out clause to the WIPO treaty to avoid this leakage from the Canadian broadcasting system.
LISTNUM 1 \l 16315 Any decision by the CRTC in favour of fee‑for‑carriage would probably put beyond reach any such opt‑out, resulting in fees‑for ‑carriage flowing to U.S. over‑the‑air broadcasters.
LISTNUM 1 \l 16316 None of this southerly revenue flow would contribute to the production of Canadian content.
LISTNUM 1 \l 16317 I would now ask my colleague, Chris Frank, to speak briefly on the second key issue in this proceeding: distant signals.
LISTNUM 1 \l 16318 MR. FRANK: Thanks, Gary.
The availability of distant signals is a significant consumer benefit.
LISTNUM 1 \l 16319 Our subscribers across the country value the viewing choices that such signals provide, and the ability to time‑shift programming at their convenience.
LISTNUM 1 \l 16320 Moreover, the value to broadcasters of time‑shifted advertising is not lost to the fast‑forward button of a PVR, as time‑shifted programming is viewed in real time.
LISTNUM 1 \l 16321 Over‑the‑air broadcasters maintain that the time‑shifting of distant signals has had a serious, negative impact on local broadcasters.
LISTNUM 1 \l 16322 We submit that such claims are overstated and that, in fact, distant signals drive a major increase in the viewing of over‑the‑air signals.
LISTNUM 1 \l 16323 Nielsen data show that, by virtue of distant Canadian signals, DTH generates increased viewing of Canadian over‑the‑air broadcasters, which is in keeping with the policy objectives of the Broadcasting Act.
LISTNUM 1 \l 16324 Indeed, the percentage of viewing of English‑language, Canadian over‑the‑air channels is 33 per cent greater on DTH than it is on cable.
LISTNUM 1 \l 16325 This 33 per cent increase in share is a bonus audience for over‑the‑air broadcasters that would not exist without the accessibility of distant signals.
LISTNUM 1 \l 16326 It is an audience and a revenue source that has been ignored in the studies submitted by the broadcasters.
LISTNUM 1 \l 16327 DTH also provides a repatriation of Canadian audiences.
LISTNUM 1 \l 16328 U.S. over‑the‑air broadcasters enjoy less than half the viewing share in Canadian DTH homes than they do in Canadian cable homes.
LISTNUM 1 \l 16329 Thus, DTH generates additional viewing of Canadian over‑the‑air‑services at the expense of U.S. broadcasters.
LISTNUM 1 \l 16330 Some conventional broadcasters argue that they are unable to monetize the viewing of these distant signals by generating additional advertising revenues.
LISTNUM 1 \l 16331 We have learned that this is inaccurate as a general statement.
LISTNUM 1 \l 16332 Broadcasters are monetizing a significant percentage of out‑of‑market tuning.
LISTNUM 1 \l 16333 Moreover, there is nothing preventing them from changing the way that they sell ads so that they can monetize this to a greater extent.
LISTNUM 1 \l 16334 That is, seize the opportunity and adapt instead of seeing only a problem and asking for a regulatory fix.
LISTNUM 1 \l 16335 Existing distant signal arrangements are working successfully in support of the Commission's desire for a vibrant, competitive environment in the BDU sector by incenting Canadians to move to digital platforms.
LISTNUM 1 \l 16336 It is important to note that the impact of distant signals on large‑market broadcasters is not the intended focus of this proceeding.
LISTNUM 1 \l 16337 The Commission has previously approved a comprehensive deal which saw substantial benefits to both large‑market and small‑market broadcasters.
LISTNUM 1 \l 16338 Now that the deal is due to be renewed, large‑market broadcasters continue to demand additional compensation from BDUs based on what Bell considers to be exaggerated claims of financial losses.
LISTNUM 1 \l 16339 Indeed, Bell submits that the negative market impact of distant signals on all markets, major or otherwise, totals less than 20 million dollars per year, while aggregate compensation that we believe is paid by digital cable and DTH providers exceeds that figure.
LISTNUM 1 \l 16340 Bell's own contributions include more than two transponders, uplinking, encoding, encryption and back‑hauling; as well, cash compensation for the second set of U.S. networks; and commercial arrangements with small independent broadcasters.
LISTNUM 1 \l 16341 In the Public Notice initiating this proceeding, the Commission stated that, and I quote:
"...the carriage provisions and the programming fund approved in Public Notice 2003‑37 have improved the financial situation for most small market independently owned television licensees."
LISTNUM 1 \l 16342 This has been confirmed by earlier speakers in this proceeding.
LISTNUM 1 \l 16343 Further, in terms of the specific written comments of the small‑market independent broadcasters, we are prepared to discuss their suggestions in prospective negotiations regarding a renewal of this agreement.
LISTNUM 1 \l 16344 In the distant signals debate the broadcasters conveniently ignore the major benefits that DTH brings to the broadcasting system.
LISTNUM 1 \l 16345 For example, as the following chart shows by year, since its launch in 1997, Canadian DTH added many new BDU customers to the Canadian broadcasting system.
LISTNUM 1 \l 16346 The total net new subscribers added reached 1.4 million in 2005.
LISTNUM 1 \l 16347 This growth has generated an estimated two billion dollars in net new revenue for Canadian pay and specialty services, much of which flows to Canadian content producers.
LISTNUM 1 \l 16348 Additional new revenue is generated for the Canadian Television Fund and other CRTC‑approved independent programming funds.
LISTNUM 1 \l 16349 This is extra revenue with no risk or investment requires on the part of broadcasters or content producers.
LISTNUM 1 \l 16350 Since all the major over‑the‑air broadcasters own specialty services, they have directly benefited from DTH investments.
LISTNUM 1 \l 16351 All this, in addition to the more direct benefits to conventional broadcasters of added over‑the‑air viewership.
LISTNUM 1 \l 16352 We have provided further explanation of these data in the attached charts.
LISTNUM 1 \l 16353 Gary?
LISTNUM 1 \l 16354 MR. SMITH: Thanks, Chris.
LISTNUM 1 \l 16355 The third key issue is the transition to digital and HD over‑the‑air transmission.
LISTNUM 1 \l 16356 Easy access to conventional broadcast services in a digital world is vital for 100 per cent of Canadians and is clearly the business concern of the over‑the‑air broadcasters licensed to provide these services.
LISTNUM 1 \l 16357 However, we acknowledge that the cost of traditional terrestrial distribution outside major markets is prohibitive.
LISTNUM 1 \l 16358 We therefore support the broadcasters' hybrid proposals, which we understand to provide digital terrestrial distribution of signals in major markets only, leaving BDUs to assist with a solution outside the major markets.
LISTNUM 1 \l 16359 Appropriate alternative approaches supported by the BDUs should be considered.
LISTNUM 1 \l 16360 The BDU are themselves facing the need for major investments, in this case, to meet the growing demand for high‑definition services.
LISTNUM 1 \l 16361 The BDUs accept this as a cost of doing business and submit that the over‑the‑air broadcasters have to assume a similar level of responsibility for the costs associated with the hybrid solutions that they propose.
LISTNUM 1 \l 16362 There is, therefore, a need for the industry to find the synergies allowing the over‑the‑air broadcasters to avoid the need for digital transmission towers everywhere, without imposing extra costs on the BDUs.
LISTNUM 1 \l 16363 As you heard yesterday, Bell is already discussing small initiatives along these lines with APTN in northern areas of Canada and is similarly prepared to discuss alternative distribution arrangements with all interested over‑the‑air broadcasters. We would present the results of such discussions for Commission consideration and approval.
LISTNUM 1 \l 16364 In conclusion, Bell categorically rejects the conventional broadcasters' proposal for fee for carriage as the wrong solution to an unsubstantiated problem.
LISTNUM 1 \l 16365 We also dispute the exaggerated claims made by broadcasters regarding the impact of distant signals on local broadcasters.
LISTNUM 1 \l 16366 And finally, we support the consideration of appropriate alternatives to a costly transition to digital over‑the‑air broadcasting.
LISTNUM 1 \l 16367 This concludes our opening comments. Thank you for your time and we are happy to answer any questions you may have.
LISTNUM 1 \l 16368 THE CHAIRPERSON: Thank you, Mr. Smith.
LISTNUM 1 \l 16369 I am asking Commissioner Duncan to initiate the questions.
LISTNUM 1 \l 16370 COMMISSIONER DUNCAN: Good morning. Your written brief and your comments this morning are certainly very helpful as they probably answered some of my questions but I will proceed anyway.
LISTNUM 1 \l 16371 You noted that you generally agree with the analytical approach taken in the Nordicity study but that the estimates and assumptions taken in the study are Nordicity's own. So there are three areas I would like to ask you about specifically and then I have a broader request after that.
LISTNUM 1 \l 16372 I am just wondering if you agree with Nordicity that the rate could increase as much as $6.00 to $19.00 if we were to allow compensation for over‑the‑air signals.
LISTNUM 1 \l 16373 MR. SMITH: I think the wide range of fees proposed by broadcasters over the course of this hearing illustrates the fact that the range of possible outcomes could be within the ranger proposed by the Nordicity study or wider.
LISTNUM 1 \l 16374 COMMISSIONER DUNCAN: I am going to ask you more specifically about that in a minute then.
LISTNUM 1 \l 16375 Do you agree with Nordicity that we could lose as many as 900,000 households?
LISTNUM 1 \l 16376 MR. SMITH: Perhaps I could ask my colleagues Chris and Barry to comment on that.
LISTNUM 1 \l 16377 MR. FRANK: I would suggest, Commissioner Duncan, that is wholly dependent on the level of the fee.
LISTNUM 1 \l 16378 COMMISSIONER DUNCAN: I should qualify that. I actually had meant to qualify it by saying if we were at the high end of that range.
LISTNUM 1 \l 16379 MR. FRANK: It also depends on the range of over‑the‑air broadcasters who would benefit from fee for carriage. For instance, we have heard from certain private broadcasters that the fee would be restricted to strictly private broadcasters and exclude private broadcasters. So it would depend on the fee level and on the range of broadcasters, i.e. the number of broadcasters who benefited.
LISTNUM 1 \l 16380 Barry, do you have anything further to add?
LISTNUM 1 \l 16381 MR. KIEFL: No.
LISTNUM 1 \l 16382 COMMISSIONER DUNCAN: It is probably unlikely that the public broadcasters and the educational broadcasters would be excluded though?
LISTNUM 1 \l 16383 MR. FRANK: Well, that has been our experience in previous CRTC decisions. When we have arranged commercial deals with private broadcasters, the Commission has ensured that those benefits ‑‑ and I am speaking specifically of DTH over‑the‑air carriage ‑‑ also apply to the CBC and Radio‑Canada. So I take your point.
LISTNUM 1 \l 16384 COMMISSIONER DUNCAN: Uh‑huh. Thank you.
LISTNUM 1 \l 16385 They also, Nordicity, estimated that the EBITDA for the BDUs could be reduced ‑‑ would, I think they said ‑‑ would be reduced between $328 million and $426 million if we did allow fee for carriage.
LISTNUM 1 \l 16386 Is that one of the items that you disagree with or agree with in the Nordicity study?
LISTNUM 1 \l 16387 MR. SMITH: I think it is clear that fee for carriage would cause significant churn to customer bases assuming the BDUs pass it on to the customers, as we would, and that churn would have a very significant effect on the profitability of all BDUs. For us, it would be very, very serious.
LISTNUM 1 \l 16388 I would point out that a successful satellite platform such as ourselves has a churn rate of approximately 1 percent per month. In a difficult environment, you could easily see that doubling to 2 percent per month. Losing an additional 1 percent of your customers every month would cost us hundreds of millions of dollars.
LISTNUM 1 \l 16389 COMMISSIONER DUNCAN: You are losing net 1 percent a month? They are just turning on and off, so people come back?
LISTNUM 1 \l 16390 MR. SMITH: Yes. A platform such as ourselves, we decide essentially how much to invest in growth and how much to invest in acquiring new customers. So most platforms will invest enough to replace any churn that does happen on your platform and some platforms such as Bell ExpressVu is going further than that and still growing aggressively.
LISTNUM 1 \l 16391 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16392 In your conclusion you state, and I quote:
"Bell does not specifically endorse all assumptions made or conclusions drawn by the Nordicity study." (As read)
LISTNUM 1 \l 16393 I was wondering if it would be possible for you to provide us with a report or an overview of where the differences are, what your thoughts are so that we have a better picture of what your position is.
LISTNUM 1 \l 16394 MR. FRANK: The prime intent of that statement was to indicate that we agree with the trends in the Nordicity Group, not specifically each and every assumption. However, if you would like us to provide a list, we would be happy to.
LISTNUM 1 \l 16395 But I think the point we are trying to make is that we agree with the trend, we don't necessarily agree with the specific assumptions and the specific figures.
LISTNUM 1 \l 16396 COMMISSIONER DUNCAN: When I was reading your brief I thought it was very alarming but it was qualified by that but I just didn't quite understand or couldn't appreciate exactly what the degree of concern should be based on that qualifier. I couldn't ‑‑ it didn't give me a good picture.
LISTNUM 1 \l 16397 MR. FRANK: Well let me reinforce our opposition to fee for carriage. We don't think it is a good idea. It is a solution in search of a problem.
LISTNUM 1 \l 16398 Having said that, it really depends on the number of broadcasters and the level of the fee for carriage that will be determined, what kind of losses in customers and what kind of increased expenses we will have to face.
LISTNUM 1 \l 16399 COMMISSIONER DUNCAN: Okay. I think that is fine. Your position is perfectly clear. I have got that, so I don't think we would need anything else but I do have some more questions along this line.
LISTNUM 1 \l 16400 CanWest questioned the high range of $19.00 and indicated they felt an increase in the order of $2.00 to $5.00 would be more reasonable. So it is quite a difference.
LISTNUM 1 \l 16401 Would you care to comment on their projection?
LISTNUM 1 \l 16402 MR. SMITH: Well we saw a range of different fees for individual channels proposed over the course of the hearing, everything from the low end of 10 cents, I think was the lowest, through to ‑‑ I think one of the channels was proposing they would like to see a fee of $2.00 per channel.
LISTNUM 1 \l 16403 Now clearly, if you take the higher end of that range and you multiply it by the number of channels that could receive these fees, you do get to the very large numbers of $19.00 quoted.
LISTNUM 1 \l 16404 It would be unthinkable ‑‑ unthinkable ‑‑ to reach anything like those high numbers and I am sure the Commission wouldn't want to go there but our concern is more that it is establishing such a damaging precedent.
LISTNUM 1 \l 16405 Even if you were to apply a fee of $1.00, say, that you could argue would be bearable by the market, the broadcasters will be back for more and they will be back for more time and again, and I think that it is establishing a tax that has no benefit to consumers and will ultimately result in the damaging effects that we have identified in our submission.
LISTNUM 1 \l 16406 COMMISSIONER DUNCAN: Thank you for that.
LISTNUM 1 \l 16407 MR. FRANK: Commissioner Duncan, I would just like to add that I think that was confirmed by the Global panel. When asked how long such a fee would stay in place, they suggested within three to four years they would be back to look at it again.
LISTNUM 1 \l 16408 COMMISSIONER DUNCAN: Yes. Yes, they did.
LISTNUM 1 \l 16409 MR. FRANK: And our experience is those fees generally go down ‑‑ excuse me, don't generally go down.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16410 COMMISSIONER DUNCAN: Yes. I knew what you were thinking.
LISTNUM 1 \l 16411 So with respect to the other ‑‑ I mean I get your position but I am just wondering if you want to have any specific comments. I would like to give you an opportunity to comment on the specific amounts proposed by some ‑‑ the CanWest, I can take it I just got your comment on the 50 cents per signal.
LISTNUM 1 \l 16412 But TQS, for example, they suggested $1.00 for themselves and $1.00 for TVA.
LISTNUM 1 \l 16413 Others supported a flat rate that would apply to all broadcasters and that the Commission should determine that rate.
LISTNUM 1 \l 16414 CTV offered 10 cents a signal with 50 percent committed to Canadian programming and the balance to be used for other initiatives that would be approved by the Commission.
LISTNUM 1 \l 16415 Do you have anything that you want to add to any of those or just ‑‑
LISTNUM 1 \l 16416 MR. FRANK: If I could just add a few words and it goes to the comment you made a few minutes ago, Commissioner Duncan, and that is that it is unlikely that the Commission would not include public broadcasters.
LISTNUM 1 \l 16417 We note that none of the private broadcasters' suggestions to you include the public broadcasters or in fact some of the other niche over‑the‑air broadcasters and that would drive up ‑‑ even the CTV proposal, some might think 80 cents ‑‑ I think when we did the math in the Toronto market it was closer to $1.40. So these are big numbers.
LISTNUM 1 \l 16418 COMMISSIONER DUNCAN: I think Commissioner Cugini did draw that out in her questioning at the time.
LISTNUM 1 \l 16419 MR. FRANK: I am sorry, I missed that.
LISTNUM 1 \l 16420 COMMISSIONER DUNCAN: No, no, that is all right. She did ask about the extra signals, thank you.
LISTNUM 1 \l 16421 You indicate if fee for carriage was imposed BDUs must be free to decline carriage of the over‑the‑air signals or to place them in discretionary packages and you pointed out that there is no guarantee that any of the incremental revenue generated by fee for carriage would be used to create Canadian programming.
LISTNUM 1 \l 16422 CBC suggested rather than imposing a fee for carriage at this time, the Commission should entertain applications to set wholesale rates for conventional television stations at the time of their licence renewal and in that context it was suggested that the Commission could choose to link the level of fees to the amounts of Canadian programming provided by the broadcasters.
LISTNUM 1 \l 16423 Can we have your comments on that CBC suggestion?
LISTNUM 1 \l 16424 MR. SMITH: I think it would be sensible for the Commission to consider all aspects of the programmers' needs at licence renewal. So in that respect I think it is a very reasonable request but we are very concerned about the Commission sending any signals to the industry the fee for carriage will be considered as part of those licence renewals for the reasons that I think we have outlined.
LISTNUM 1 \l 16425 We are very skeptical about the broadcasters' suggestions, in various forms from the various broadcasters, that they will consider incremental commitments to Canadian content and priority content.
LISTNUM 1 \l 16426 We think that it is very clear that the broadcasters are seeking an improvement to their bottom lines. They were very clear about that objective of seeking fee for carriage, and clearly, if they are granted fee for carriage only to have it diverted into additional costs for their businesses, it doesn't achieve their objective.
LISTNUM 1 \l 16427 So I think that the broadcasters are suggesting that whilst the Canadian content and priority programming obligations may be reviewed as a part of the licence condition, the reality of their offer to provide additional programming in return for fee for carriage is an illusion.
LISTNUM 1 \l 16428 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16429 If fee for carriage was adopted as a regime despite what you are telling me, I am wondering do you think that we should continue to require distributors to provide broadcasters with priority carriage or simultaneous substitution?
LISTNUM 1 \l 16430 MR. SMITH: We would like to see the move towards the specialty world where we can change the packaging of those channels. It is not so much the must carry obligation but the packaging would be sensible to be considered. We would like to give our customers the option to choose if they are forced to pay for a service like that.
LISTNUM 1 \l 16431 Chris, I think you might have something to add.
LISTNUM 1 \l 16432 MR. FRANK: Thank you, Gary.
LISTNUM 1 \l 16433 When you think about the availability of these signals on a free‑to‑air basis in communities such as the one we are in today, the consumer does have the option of erecting an outside antenna or in fact using sophisticated inside receiver equipment to switch from satellite or cable to the free over‑the‑air signal.
LISTNUM 1 \l 16434 If we are offering that signal on a priority basis, which means it is on basic, and there is a fee for carriage and we don't give the consumer the opportunity to opt out, I think we will have a major, major irritant on our hands and I think our call centre will light up like the 1st of July.
LISTNUM 1 \l 16435 COMMISSIONER DUNCAN: Shaw had a discussion this morning. They were talking about the preponderance of Canadian signals.
LISTNUM 1 \l 16436 Did you have any comments on their suggestion?
LISTNUM 1 \l 16437 MR. FRANK: Well, we have long advocated preponderance in a digital world. We think that the technology allows customers to ‑‑ it is a hundred percent addressable and it allows the customers to pick and choose what they want. That is a huge, huge benefit and I think it is one of the major benefits driving people from analog to digital.
LISTNUM 1 \l 16438 So we would like to offer customers what they want but our view of preponderance is that we would ensure that each customer purchases more Canadian services than they do foreign services. So it is not preponderance at the distribution level but rather preponderance at the consumer level.
LISTNUM 1 \l 16439 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16440 CTV suggested that broadcasters should be able to refuse to allow BDUs to carry their signals in distant markets if they are unable to negotiate a satisfactory fee for carriage.
LISTNUM 1 \l 16441 I am wondering what your thoughts are.
LISTNUM 1 \l 16442 MR. SMITH: On the fee for carriage for distant signals, which I think was the context, if you are referring to that.
LISTNUM 1 \l 16443 COMMISSIONER DUNCAN: Yes, it was.
LISTNUM 1 \l 16444 MR. SMITH: They were establishing a precedent which would be very damaging, we believe, if implemented because if the broadcasters have the option to force us to withdraw distant signals if we are unable to agree, we would have no basis for sensible negotiation of any arrangements.
LISTNUM 1 \l 16445 Further to that, we believe that withdrawal of distant signals would be a major consumer irritant. As I think has been made clear by previous speakers to this hearing, Canadians like viewing of distant signals, particular the ability to time shift.
LISTNUM 1 \l 16446 I think Mr. Rogers and his panel made it very clear that it was a major drive to take up digital television in Canada, which we think has been good overall, and we would very much dislike any possibility of distant signals being withdrawn.
LISTNUM 1 \l 16447 Chris, would you like to add anything?
LISTNUM 1 \l 16448 MR. FRANK: I would just like to note, Commissioner Duncan, that that would be a radical departure from the current regime.
LISTNUM 1 \l 16449 First of all, in the broadcast distribution regulations there is a mechanism called dispute resolution, and it contemplates the provision of the continuation of a service while negotiations or in fact a dispute is under way.
LISTNUM 1 \l 16450 Just to reinforce what Gary said, putting the toothpaste back in the tube in terms of distant signals is going to be a major challenge for digital distributors in Canada.
LISTNUM 1 \l 16451 We have always been committed to coming to the table and negotiating with broadcasters. We have, I would like to think, a first class record in that regard. We are the company who instigated the first and second, and completed the first and second, comprehensive agreements with the CAB.
LISTNUM 1 \l 16452 In the first instance, the broadcasters had cash compensation in mind. In the second round of discussions, which led to the deal the Commission approved three and a half years ago, which is on extension, they switched from compensation ‑‑ and this is very important. They wanted carriage. They stated that right up front. They wanted more carriage.
LISTNUM 1 \l 16453 And that's what the deal ended up giving them: two and a half more transponders worth of carriage for small independents and for large market broadcasters.
LISTNUM 1 \l 16454 That deal costs us now $8 million a year.
LISTNUM 1 \l 16455 COMMISSIONER DUNCAN: I think it is very useful to have your answers to their suggestion on the record.
LISTNUM 1 \l 16456 I want to explore a little more on that.
LISTNUM 1 \l 16457 I was a little surprised yesterday when I was discussing it with the CCSA people. As they pointed out and you are mentioning the funds that you are already paying to the CAB now, I am assuming therefore that CTV was anticipating that there would no longer be this bulk CAB deal but they would negotiate individually.
LISTNUM 1 \l 16458 Would you take that to be the intent of their suggestion?
LISTNUM 1 \l 16459 MR. FRANK: I think that is correct. But if my memory is correct, the work‑around solution that was contemplated in our original licence, and I think has been captured in the broadcast distribution regulations, contemplates negotiating with an industry group. It becomes very complicated.
LISTNUM 1 \l 16460 I think it was Ms Fusca from Stornoway yesterday who explained how difficult it is to go from BDU to BDU to cut deals. It would be, I think, problematic to go from broadcaster to broadcaster. We would rather negotiate with an industry group like the CAB, but we are not firm on that.
LISTNUM 1 \l 16461 We will come to the table with reasonable suggestions to arrive at an arrangement so that we don't have to delete identical programs on distant signals.
LISTNUM 1 \l 16462 That is the essence of the problem. As Mr. Hennessy said to you yesterday, this isn't about access to distant signals; it is, rather, compensation in lieu of program deletion.
LISTNUM 1 \l 16463 Our company ‑‑ and I would imagine other digital broadcasters in Canada ‑‑ simply would not be competitive one to another or with the U.S. DBS companies if we had a menu of conventional Canadian stations that look like Swiss cheese.
LISTNUM 1 \l 16464 COMMISSIONER DUNCAN: I didn't get the impression from CTV that they were talking about that. I thought they were talking about value for their signal. They weren't talking, I didn't think, in terms of not having to delete the signal.
LISTNUM 1 \l 16465 So whether this was an additional charge or an additional reason to have a charge...
LISTNUM 1 \l 16466 MR. SMITH: Perhaps I could speak briefly before I ask Chris to elaborate.
LISTNUM 1 \l 16467 I think the submissions from the broadcasters have claimed very significant damage to their businesses caused by distant signals. They have submitted various reports to substantiate their claims, and we have read those reports with great interest.
LISTNUM 1 \l 16468 We believe that whilst the reports are obviously founded on good scientific bases, some of the assumptions in their reports are questionable, in fact just miss some important points.
LISTNUM 1 \l 16469 We have assessed the damage as significantly less.
LISTNUM 1 \l 16470 The damage that we have assessed ‑‑ and I think we alluded to it in our opening statement ‑‑ we think is capable of being addressed with regulatory intervention through negotiation.
LISTNUM 1 \l 16471 If CTV's position is that the damage is greater and that they would like to see regulatory intervention to help them negotiate a better settlement, our contention is that is not necessary. No regulatory intervention is required in the environment as it exists today. We are happy to go to the table with these broadcasters and negotiate a new settlement.
LISTNUM 1 \l 16472 We have brought Barry Kiefl with us, who has done the analysis on the reports, if the Commission would like to understand further our reasoning behind our lower estimates of the damage caused to this distant signal debate.
LISTNUM 1 \l 16473 COMMISSIONER DUNCAN: Thank you. I don't have any specific questions on the report, at least not at this time. Some of my colleagues might. Thank you for the offer.
LISTNUM 1 \l 16474 This actually leads us right into the question that I had about time and station shifting. I did read, of course, in your brief your feeling and why you felt that they were able to monetize the time shifting. And I did give them an opportunity on Monday to explain their side of it, so we don't need to go there.
LISTNUM 1 \l 16475 The broadcasters are making a distinction between time shifting and station shifting, and I didn't come away with that when I was reading your brief.
LISTNUM 1 \l 16476 I am wondering if you would care to comment on this distinction.
LISTNUM 1 \l 16477 I think, as well, you have already commented on Rogers' position yesterday that time shifting actually represents an opportunity for broadcasters and BDUs to work together.
LISTNUM 1 \l 16478 I would be curious to know if you have made any attempts. I understand from the Rogers people that they have made some approaches. Rogers, of course, explained that the most important thing was increasing eyeballs and slowing down the move to PVRs, and you touched on that as well in your comments.
LISTNUM 1 \l 16479 I guess I'm just interested to know if there is an argument there. Is station shifting another aspect of it or just another positive aspect from your point of view?
LISTNUM 1 \l 16480 MR. SMITH: I'm going to ask Chris and Barry to contribute to this answer, but I would like to start off by reminding the Commission of what I find quite an outstanding statistic: and that is that the viewing of these channels in DTH homes is 33 percent greater than it is in cable homes.
LISTNUM 1 \l 16481 The actual numbers underlying that is 43 percent of viewing in Canadian homes is of these over‑the‑air channels over DTH and only 30 percent in cable homes.
LISTNUM 1 \l 16482 COMMISSIONER DUNCAN: Can I just ask here: Is that because there are more of them and it gives them more opportunities?
LISTNUM 1 \l 16483 MR. SMITH: The obvious suggestion is that having a line‑up which includes all the distant signals gives customers a lot more opportunity to view Canadian content and the adverts that are contained on those channels.
LISTNUM 1 \l 16484 COMMISSIONER DUNCAN: Which they make use of.
LISTNUM 1 \l 16485 MR. SMITH: I think that is a fact. It's a measured fact. So it is very easy to substantiate the fact that there is an opportunity here.
LISTNUM 1 \l 16486 It does become arguable as to how extensive the broadcasters are actually monetizing that or able to monetize it. I think that was the discussion that you had with the broadcasters earlier in the hearing.
LISTNUM 1 \l 16487 Let me invite my colleagues, Chris and Barry, to contribute to this.
LISTNUM 1 \l 16488 MR. FRANK: The only thing that I would like to add before I pass the microphone to Barry is that the whole program substitution and program deletion regime is about local program rights, not about distant signals per se or the value or access to distant signals. It is to protect local rights. So with simultaneous substitution, programs from certain distant signals are substituted for local signals. Or there is a program deletion regime in place.
LISTNUM 1 \l 16489 Our comprehensive deal with the CAB addresses the issue of program deletion and our particular regulatory regime. We have put in place additional carriage and other limitations on signal shifting and time shifting to protect specifically small market broadcasters but also to protect large market broadcasters as well.
LISTNUM 1 \l 16490 Barry.
LISTNUM 1 \l 16491 MR. KIEFL: Thanks, Chris.
LISTNUM 1 \l 16492 The bonus audience that was referred to in the opening statement, and which Gary just referred to, it was about three years ago actually that Nielsen decided that it was time to break out the audience according to digital cable homes and analog cable homes and satellite homes. It was actually quite a shock.
LISTNUM 1 \l 16493 I remember the first time looking at the data. It was the beginning of the TTCs in 2003‑04. Looking at the size of the audience for Canadian broadcasters within the DTH environment ‑‑ this is in English TV ‑‑ Gary mentioned the last TTCs in 2004‑05, Nielsen put it at 43 percent. That's on a 24‑hour basis.
LISTNUM 1 \l 16494 In prime time it was close to 50 percent, which is really quite remarkable. Compared to the cable universe, it's just a little over 30 percent. So you are talking about a repatriation of the Canadian audience for Canadian broadcasters.
LISTNUM 1 \l 16495 It relates to the whole issue of monetization because clearly that bonus audience is something that if it weren't for DTH, a large part of that audience the broadcasters wouldn't have. If DTH operated like a cable in the sky, like old‑fashioned cable, and only carried local signals and so forth, there wouldn't be nearly as large an audience for Canadian broadcasters.
LISTNUM 1 \l 16496 What you are talking about is a bonus audience that has been generated by DTH that is an audience they wouldn't have had without DTH. Even if there is some part of it that they can't monetize ‑‑ and I'll spend a moment talking about the part that I think they can monetize and are monetizing right now ‑‑ there is an audience there that they wouldn't have had otherwise.
LISTNUM 1 \l 16497 So if there is a part of it that they can't monetize, it's an audience they wouldn't have had. If all of a sudden these distant signals were to disappear their audience would decline substantially.
LISTNUM 1 \l 16498 Think for a moment of CTV. CTV has some major hit shows in prime time, like CSI with 3 million viewers or more on some weeks. About 10 percent of that audience is delivered by distant signals. I doubt very much that CTV would be happy with a situation which would see 3 million drop to 2.7 million all of a sudden.
LISTNUM 1 \l 16499 The part that they can monetize, CTV in particular or CBC ‑‑ CTV said here earlier this week that about 30 percent of their revenue is from network advertising. That 30 percent is an audience that is delivered partly by distant signals. There is really no way around it.
LISTNUM 1 \l 16500 I've checked with the ACA, the Association of Canadian Advertisers, the organization that represents all of the advertising agencies, the CNTC. They confirmed that they do pay for the audience to network commercials that are delivered by distant signals.
LISTNUM 1 \l 16501 So CTV is talking about 30 percent of its revenue coming from network signals, network advertising.
LISTNUM 1 \l 16502 CBC Sales confirmed with me this week that they deliver 50 percent of their revenue with network ads. If somebody is watching Hockey Night in Canada on a distant signal, they want to catch the Toronto game in Vancouver off of CBOT on ExpressVu, that audience is counted by the measurement companies. It is delivered to the CBC. They sell the audience to the network advertiser.
LISTNUM 1 \l 16503 So you have a combination of both the network advertising and the bonus audience which, combined, represent perhaps as much as 75 percent of the monetization issue in terms of what DTH ‑‑ in particular DTH, and digital cable is doing the same thing. But DTH because it does have so many additional channels and does deliver this extremely high audience for Canadian broadcasters is primarily responsible for really delivering a new audience and an audience that is watching a lot of network commercials.
LISTNUM 1 \l 16504 COMMISSIONER DUNCAN: Thank you. Would you ‑‑
LISTNUM 1 \l 16505 MR. FRANK: Could I just add to that very quickly by giving you a quick example of one of the palpable benefits of time shifting.
LISTNUM 1 \l 16506 Barry has mentioned Hockey Night in Canada. It would seem that the national press is preoccupied with the ubiquity of Toronto Maple Leaf hockey games coast to coast. Through distant signals the local Ottawa hockey games, which are carried by the CBC and are often restricted just to the Ottawa area, are now available coast to coast to coast.
LISTNUM 1 \l 16507 So all of this, all of CBC's hockey games are available and I think that very much pleases consumers; not everybody in Canada is a Toronto Maple Leaf fan.
LISTNUM 1 \l 16508 COMMISSIONER DUNCAN: My husband certainly is. I have certainly heard about them for long enough.
LISTNUM 1 \l 16509 Yes. Would you agree with me then that this bonus audience is, in fact, only going to increase as cable deploys more of their digital service, these people buy more of their digital packages?
LISTNUM 1 \l 16510 MR. KIEFL: Yes. I think cable began offering distant signals in competition with DTH to meet the competition of DTH about three of four years ago, but they began initially by offering them as a separate package which the consumer could pay. I think it was around $5.00 a month to receive all of this package of distant signals.
LISTNUM 1 \l 16511 And then, about 18 months ago or maybe a little longer, they opted to offer them as part of the digital basic package and as digital cable continues to grow and no doubt it will, and DTH, I'm sure, is going to be trying to get more customers in addition, we are going to see more of this trend, there is no question about it.
LISTNUM 1 \l 16512 COMMISSIONER DUNCAN: Do you think that they are ‑‑ I want to keep on with this because I think everybody has made their points wo we will have to go away and deliberate, but I just ‑‑ do you think there is a distinction where you are mentioning between station shifting and time shifting or it's just ‑‑ it's all a benefit from your point of view?
LISTNUM 1 \l 16513 MR. KIEFL: Well, it's a benefit, but one of the quite interesting findings in both the Armstrong Consulting Study and in the study done by CanWest was that of the distant signal viewing that they measured in their analyses of BBM data, something in the neighbourhood of 40 to 45 per cent of all of the distant signal viewing in each of the studies was attributed to station shifting.
LISTNUM 1 \l 16514 COMMISSIONER DUNCAN: I see.
LISTNUM 1 \l 16515 MR. SMITH: And I find it interesting in that we talk about distant signals in the context of time shifting, but in reality a lot of the distant signal viewing that's going on, as measured in both of those studies, is the stations that are shifted.
LISTNUM 1 \l 16516 And I should point out that ‑‑ and I think there was a question yesterday put to Rogers about station shifting that it's not necessarily the whole station that's shifted. It can be just an individual program.
LISTNUM 1 \l 16517 For example, Global about two years ago began airing programs in the Eastern time zone so that they aired at the same time ‑‑ in the Atlantic time zone so that they aired at the same as the local station did in Toronto.
LISTNUM 1 \l 16518 So, you can actually station shift or program shift, as opposed to the whole station.
LISTNUM 1 \l 16519 COMMISSIONER DUNCAN: O.K. Thank you very much.
LISTNUM 1 \l 16520 We are looking to get some information on costs so I think it will help us with that, that would be great.
LISTNUM 1 \l 16521 Some broadcasters have provided preliminary estimates on the cost of greater existing transmitter networks to high definition. That's the replacing of the whole network and others, and also cost on constructing a system ‑‑ sorry ‑‑ a system paralleling their network and the first one on upgrading.
LISTNUM 1 \l 16522 Would it be cost effective as another alternative for a broadcaster to distribute its service in high definition across its market by satellite, with the signal being delivered free to air with your experience in satellite delivery?
LISTNUM 1 \l 16523 MR. SMITH: It's quite a complex answer I think is the preface to my answer. You can't look at the cost of distribution by satellite on a channel by channel basis because there is such large embedded cost in running a satellite platform.
LISTNUM 1 \l 16524 So I think some of the broadcasters have been the point that it is just is inappropriate for them to essentially set up their own satellite platform for distribution of over‑the‑air signals, be it SD or HD.
LISTNUM 1 \l 16525 It would make sense for them to piggyback on the back of an existing satellite platform like Bell ExpressVu and we agree with that, it's just simple economic as it costs hundreds of millions of dollars to set up a satellite platform before you put any channels up.
LISTNUM 1 \l 16526 And then, you have the incremental costs of providing additional bandwidth to carry each service.
LISTNUM 1 \l 16527 The previous panel, Mr. Shaw's panel, gave the Commission some numbers which I would broadly support that each transformer would probably cost around two million dollars a year and the number of channels you can put on that transformer is about eight or so SD channels and two HD channels are present and that may grow in the future.
LISTNUM 1 \l 16528 But I would stress the point, that is the incremental cost over adding each new signal. It does not take into account any of the core infrastructure costs that the business has. It doesn't take into account the cost of all the costs of services or security services and everything else.
LISTNUM 1 \l 16529 Another point I would like to make in answer to this question is the satellite resources are finite. There is only so many frequencies available. There is only so many over the locations available and probably more importantly, each customer with a satellite dish currently only looks at certain frequencies and certain over the locations.
LISTNUM 1 \l 16530 So, once you could theoretically, if there was bandwidth available in space for another satellite with different location, you haven't got anybody looking at it and it's a huge logistical exercise to provide dishes and set up boxes to customers which is, yes, another reason why piggyback is such a service on the back of an existing satellite platform is the right way to go
LISTNUM 1 \l 16531 COMMISSIONER DUNCAN: I'm sure you can appreciate that we are just trying to address that remaining five to ten per cent.
LISTNUM 1 \l 16532 MR. KIEFL: Yes. I think my colleague, Mr. Frank, would like to add something.
LISTNUM 1 \l 16533 MR. FRANK: I would just like to comment on some of the evidence given by previous witnesses to the effect that the two DTH companies and I should only speak obviously of ExpressVu, are bringing on new satellite capacity in the not too distance future.
LISTNUM 1 \l 16534 I would just like to point out that the next satellite that we will be acquiring will actually be a replacement satellite. So, whereas it will provide a better coverage, higher power coverage of Canada, which is more conducive to high definition TV, we are not increasing the number of frequencies at that orbital slot that are currently available to us.
So, it's replacement, it's not necessarily incremental.
LISTNUM 1 \l 16535 The first opportunity for incremental a space segment and as Gary said, will be at a different orbital location which has significant logistical challenges and significant costs associated because you have to provide a new receive end antenna won't be till after 2010. Gary, you have the ‑‑
LISTNUM 1 \l 16536 MR. SMITH: Yes, that's the right time frame, around 2010. I appreciate the intervention from Mr. Frank because these are huge costs, huge costs, the cost of any satellite exceeds one billion dollars as the commitment that we have to sign to support any satellite to expand our services.
LISTNUM 1 \l 16537 Now, that investment is a cost that we, as a BDU, are willing to embrace and we have embraced it for satellite bandwidth today and we will continue to do so, particularly in respect of the growth of HD services in Canada.
LISTNUM 1 \l 16538 We believe we have to bear our own costs for that and, you know, grow with the punches the industry charges us and HD is one of those punches great opportunities. We simply believe that the over‑the‑air broadcasters have to do the same in these respects. They have to, you know, evolve their businesses and innovate to the same extent according to our submission.
LISTNUM 1 \l 16539 COMMISSIONER DUNCAN: I appreciate your comments and then certainly that wouldn't sound to be a third possibility or alternative for them continuing over‑the‑air distribution.
LISTNUM 1 \l 16540 MR. SMITH: I would like to add that, you know, once I think satellite distribution is a very expensive option for them to pursue in isolation.
LISTNUM 1 \l 16541 I think because we will have to carry a lot of these channels anyway, as a result of the existing regime, there is an opportunity for synergies by bringing into the market a solution whereby a satellite distribution platform provides access to a limited number of high definition signals or digital standard definition signals to Canadian consumers outside the major markets, either at a reduce subscription or a subscription which is subsidized by the broadcasters over on some commercial basis that works for the industry.
LISTNUM 1 \l 16542 And we are anxious and willing to participate in those discussions.
LISTNUM 1 \l 16543 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16544 MR. FRANK: And those are the types of things we can talk about with the broadcasters in the context of a new comprehensive agreement respecting program deletion.
LISTNUM 1 \l 16545 COMMISSIONER DUNCAN: Thank you. That actually ‑‑ I jump ahead of my question because that sort of follows into one of my other questions that I had.
LISTNUM 1 \l 16546 Just dealing with these customers that will be the remaining five or ten per cent, estimated to be the remaining five to ten per cent, there is two suggestions that I am aware of, that provision of a set‑up box at low or no cost or the provision of a sub‑basic package which would be excluding, which would exclude probably the U.S. channels and these would be take it then the kinds of solutions that you're suggesting, you might be able to work upon with the broadcasters as a more cost effective delivering service to these hold‑outs if you like?
LISTNUM 1 \l 16547 MR. SMITH: In general, the types of options you've described, there are certainly the types of things that we would be welcome ‑‑ we would be happy to discuss.
LISTNUM 1 \l 16548 There are many different models, but we have to acknowledge there is a huge cost in carrying these signals and in providing the logistics and the set‑up boxes and things, so somebody has to be and if we want to bring those services for each subscriber, then there is a cost to the industry.
LISTNUM 1 \l 16549 But, you know, our ambition would be to make the costs as achievable as possible and what the broadcasters to find a way to make it work for them as well as for ourselves.
LISTNUM 1 \l 16550 COMMISSIONER DUNCAN: Thank you. I have another cost capacity related question here with regards to the ‑‑ what I understand is 124 local stations and in your brief, you indicated that you're presently carrying more than 70 I think is what it said.
LISTNUM 1 \l 16551 I am just wondering how much satellite capacity would be required to distribute the remaining local stations in standard definition and then when they convert to high definition and what kind of cost and timing you expect involved there, if you were to ‑‑ first of all, I guess we would have to assume you're going to deliver all 124, but ‑‑
LISTNUM 1 \l 16552 MR. SMITH: Well, first of all, a simple math that each transformer on the satellite carries eight, nine, ten channels, that sort of number, depending on the content of those channels. So, the simple math would say if there is 54 channels missing, then it would be five, six, seven transformers, that sort of size. I think that's consistent with the kind of ‑‑ the response to the same question that was posed to Mr. Shaw's organization as well.
LISTNUM 1 \l 16553 COMMISSIONER DUNCAN: Yes.
LISTNUM 1 \l 16554 MR. SMITH: So, that clears the simple math issue.
LISTNUM 1 \l 16555 From our business perspective, it would be a ‑‑ it would be an unreasonable demand on our business to carry all 124. There is hugh duplication in these signals and they don't bring any additional value to the majority of the subscribers and I simply don't recognize the physics of a satellite platform.
LISTNUM 1 \l 16556 Satellite platforms are really good at delivering, you know, high quality bandwidth with intensive signals across to a larger audience across a large area and I think the compromise that has been reached over the course of the last ‑‑ well, since ExpressVu was created back in 1998 where we carry two thirds of the signals, 70 or so, is an appropriate compromise for the SD world.
LISTNUM 1 \l 16557 And whilst we are prepared to look at tweaking the number of signals we carry, so for example the small independent ‑‑ sorry, the independent broadcasters serving small markets, we know are seeking another four signals, I think, and we are very happy to consider that request as part of the overall negotiation, without making any commitment to carry them across, but we need to ‑‑ we do need to discuss of other aspects of that deal.
LISTNUM 1 \l 16558 We're happy to consider tweaking with them, but a whole set increase from 70 to 124 would rob us of five, six, seven transformers as which (a) we don't have today. We are in the same position that Mr. Shaw's organization is, that there just isn't. You don't leave satellite capacity unused. So we would have to take down money earning services, revenue earning services, which would hurt potentially Canadian specialty in pay and our business.
LISTNUM 1 \l 16559 And we also need future growth of satellite resources to deal with the enormous transition to HD that we're expecting over the coming three to five years.
LISTNUM 1 \l 16560 We currently have in excess of 40 HD channels, we are expecting that to grow to more than 100 in the near future and that's going to really stretch our resources to meet that need. So, to take five, six, seven transformers, which is a substantial pushing of a new satellite to deal with signals which don't bring any incremental value to the majority of our subscribers. It just doesn't make sense, I'm afraid, Commissioner Duncan.
LISTNUM 1 \l 16561 COMMISSIONER DUNCAN: You mentioned about the satellite being replaced, a replacement satellite. So, will that give you ‑‑ does it also include an increase in capacity then?
LISTNUM 1 \l 16562 MR. SMITH: No, it doesn't. We, as Chris described, we currently have four satellites dedicated to ExpressVu services in over two different over the locations. Two of them, the 82 degree location and those two satellites are going to be replaced by the new satellite when it's launched in 2008.
LISTNUM 1 \l 16563 COMMISSIONER DUNCAN: I'm sorry, which location did you say?
LISTNUM 1 \l 16564 MR. SMITH: It's over the locations 82 degrees west. It's one of our two over the locations and the satellites of that location will be straight replaced by the new satellite that we're launching in 2008, subject to a successful launch, of course.
LISTNUM 1 \l 16565 So, we are looking at increasing capacity further, but as per described that means going to different frequencies and different over the locations and that's great and very significant logistical issue how you migrate customers to that location.
LISTNUM 1 \l 16566 COMMISSIONER DUNCAN: Now, you mentioned I think a few seconds ago that you expect that the HD signals that you're carrying are going to increase in the near term to 100. Do you have the capacity now for that?
LISTNUM 1 \l 16567 MR. SMITH: No.
LISTNUM 1 \l 16568 COMMISSIONER DUNCAN: You don't have the capacity.
LISTNUM 1 \l 16569 MR. SMITH: No. We will be achieving that through a combination of technology enhancements for the existing satellite technology ‑‑ the existing orbital locations, by making more efficient use of those locations, and by adding incremental capacity at new orbital locations not yet contracted for.
LISTNUM 1 \l 16570 COMMISSIONER DUNCAN: Mr. D'Avella mentioned compression ‑‑ or three HD services on one transponder.
LISTNUM 1 \l 16571 Is it reasonable to expect, then, that technology will evolve so that that three will increase to five or six?
LISTNUM 1 \l 16572 MR. SMITH: It is early days to say with high definition, but there is certainly potential for it to increase, and increases over the next five to ten years do factor into our satellite plans.
LISTNUM 1 \l 16573 We certainly anticipate, say, in ten years' time, being able to carry significantly more services because of improvements in technology. But in the short term ‑‑ and by "short term" I am thinking three to five years ‑‑ we will be significantly constrained by available bandwidth and current technology. So to carry another 50 SD services ‑‑ even the 50 in SD would be unreasonable.
LISTNUM 1 \l 16574 And to start to suggest that we would carry the same services in HD would be just a death blow to the DTH business.
LISTNUM 1 \l 16575 COMMISSIONER DUNCAN: On the point of omnibus channels, it seems that that would be most applicable to the small‑market stations.
LISTNUM 1 \l 16576 Am I correct in that?
LISTNUM 1 \l 16577 I am just wondering if you have actually sat down at the table with them and tried to explain your situation, and shown them that this would be an avenue for them to get their local content across the country, if that is their objective, by using an omnibus channel.
LISTNUM 1 \l 16578 MR. SMITH: I am going to ask my colleague, Chris, to speak to this in more detail, because, as Vice‑President of Programming, he is responsible for all of the discussions we have directly with the broadcasters and will know more detail than I do.
LISTNUM 1 \l 16579 The omnibus suggestion, which ExpressVu was very happy to pioneer and obtain Commission approval for, is something which could apply to any local content, not just for the independents. It could apply to any of the broadcasters.
LISTNUM 1 \l 16580 Chris, would you like to expand upon that?
LISTNUM 1 \l 16581 MR. FRANK: Yes, thank you, Gary.
LISTNUM 1 \l 16582 We have had discussions with most of the broadcast groups, and certainly with the CAB, in the discussions that led up to the last comprehensive agreement.
LISTNUM 1 \l 16583 We did float this idea at our licence renewal, and subsequently we got CRTC permission to do it.
LISTNUM 1 \l 16584 In fact, we are doing it now with CJOH.
LISTNUM 1 \l 16585 I would encourage the broadcasters and the Commission to think of this not just necessarily as an omnibus channel, because I understand the broadcasters' concern about having CTV programs mixed up with CTV programs, mixed up with Global, et cetera.
LISTNUM 1 \l 16586 We are prepared, to the extent our resources permit, to provide each local channel with its individual channel spot on our electronic programming guide, so there is not a hodge‑podge of programming on one omnibus channel.
LISTNUM 1 \l 16587 The idea would be that all of the unique local programming, market‑over‑market, would be available on a discrete channel, and those discrete channels would be placed contiguous to the same network in time zone. So for customer convenience ‑‑
LISTNUM 1 \l 16588 The broadcasters are concerned that, in an array of 1,000 channels, they will get lost.
LISTNUM 1 \l 16589 Let's use an example, because it's appropriate.
LISTNUM 1 \l 16590 Let's take CBC Kingston, which is owned by the Corus Group. If we provided the unique local programming from Kingston ‑‑ Kingston is not currently carried on our service ‑‑
LISTNUM 1 \l 16591 COMMISSIONER DUNCAN: Yes, we know that.
LISTNUM 1 \l 16592 MR. FRANK: ‑‑ near or very close to either Ottawa or Toronto, or maybe between Ottawa and Toronto, people who want CBC network programming can easily rejoin the network, without getting lost, yet people in Kingston, and expat folks from Kingston across the country, can see all of the local programming and local news from Kingston.
LISTNUM 1 \l 16593 That is the essence of our proposal. It was, I think, quite clear in our licence application some years ago. And, as I said, the Commission has approved it, and we are very interested in exploring this possibility with broadcasters, because it brings more local and regional programming to our subscribers.
LISTNUM 1 \l 16594 COMMISSIONER DUNCAN: I would think they would be more interested in exploring it with you, as well, given that it seems unrealistic to expect that we are going to be able to add all 124 channels.
LISTNUM 1 \l 16595 MR. SMITH: Absolutely.
LISTNUM 1 \l 16596 I would like to add to Chris' response.
LISTNUM 1 \l 16597 The technology that we have in a digital satellite platform is very advanced, and it brings a lot of capabilities. It is appropriate, and we want to try to bring those capabilities to the benefit of the industry, and, of course, ourselves and our consumers.
LISTNUM 1 \l 16598 Hence, we have made significant investments in, for example, interactive technology.
LISTNUM 1 \l 16599 Some of the Commissioners may be aware that we recently launched an interactive sports portal and an interactive news portal to give customers on‑demand access to more content.
LISTNUM 1 \l 16600 This technology enables broadcasters to do things like interactive advertising, or other interactive ventures that we haven't even thought of yet.
LISTNUM 1 \l 16601 Quite frankly, we are a little bit disappointed that the broadcasters are not working with us more aggressively to make use of this innovative technology that we are pioneering to overcome some of these difficulties, but are, instead, coming to the Commission for a regulatory fix to a problem that we don't think exists anyway.
LISTNUM 1 \l 16602 COMMISSIONER DUNCAN: Do you approach them on that? Do you take the initiative?
LISTNUM 1 \l 16603 MR. SMITH: Absolutely, Commissioner Duncan.
LISTNUM 1 \l 16604 We have a team of individuals within our organization looking after the technology, but also the promotion and the marketing aspects of that technology ‑‑
LISTNUM 1 \l 16605 COMMISSIONER DUNCAN: But the liaison ‑‑
LISTNUM 1 \l 16606 MR. SMITH: ‑‑ who are working with the broadcasters, and we are continually trying to persuade them to engage with us.
LISTNUM 1 \l 16607 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16608 MR. FRANK: Yes, I can confirm that the liaison through my department is fully engaged.
LISTNUM 1 \l 16609 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16610 MR. FRANK: If I could go back two or three questions to your question about the number of high definition services available on one transponder, it is our evidence ‑‑ and I think it was Mr. D'Avella's evidence, too ‑‑ that the current state of the art is two per channel, and that we hope to get to three, maybe four, in the near to middle term. But currently it is two.
LISTNUM 1 \l 16611 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16612 Do you think that the absence of an off‑air alternative would change the competitive balance in the marketplace and allow distributors to raise their rates?
LISTNUM 1 \l 16613 This is a concern from a consumer point of view.
LISTNUM 1 \l 16614 MR. SMITH: My initial reaction is no, I don't think it does affect the rates that BDUs are able to charge for the services they currently provide.
LISTNUM 1 \l 16615 I think there is a die‑hard community of people that don't see the need for the extra value that television entertainment brings. They really just want local news, for example, and I think that is an important social service. That is my personal view.
LISTNUM 1 \l 16616 As we made clear in our opening statement, we think that those services should be available to 100 percent of Canadians, and there is a place for over‑the‑air broadcasting into the future.
LISTNUM 1 \l 16617 I'm sorry; does that answer the Commission's question?
LISTNUM 1 \l 16618 COMMISSIONER DUNCAN: Actually, no.
LISTNUM 1 \l 16619 I'm sorry; I will try again.
LISTNUM 1 \l 16620 MR. SMITH: I will try again.
LISTNUM 1 \l 16621 COMMISSIONER DUNCAN: I am just thinking in an instance where the off‑air is gone because the spectrum has been taken away, or the analog transmitters are worn out and haven't been replaced, so there is no over‑the‑air transmitter.
LISTNUM 1 \l 16622 Then you are dealing with cable and DTH.
LISTNUM 1 \l 16623 Do you think, then, that we should be concerned that it would give distributors a greater opportunity to increase prices?
LISTNUM 1 \l 16624 MR. SMITH: I think, if we can find a solution whereby the BDUs help to provide a zero or a low‑cost solution for the small percentage of customers who don't want the rich content that is available on the BDUs, then I don't see any reason why it would change the existing model at all. There would be an opportunity for customers to gain access to the four, five or six signals they currently enjoy via over‑the‑air transmission through the BDUs, in some appropriate format.
LISTNUM 1 \l 16625 The customer may have to buy reception equipment, and there may be arrangements in place with the broadcasters to cover the costs, but it would be an acceptably low cost to the consumer, and it wouldn't feel like a subscription.
LISTNUM 1 \l 16626 Then, the existing regime wouldn't be changed.
LISTNUM 1 \l 16627 If you took them away entirely, then, I would still not see an opportunity for us, for example, to increase our prices, because I think we have certain access to a customer's propensity to pay for these services, and it depends on the quality of the services we bring, which is why we would continue to invest in more services, more HD.
LISTNUM 1 \l 16628 We think that, when you add real value to subscribers, by adding choice of programming and quality of programming and high definition services, then customers have demonstrated that they are willing to pay for those services.
LISTNUM 1 \l 16629 But we don't ask customers to pay something for nothing, which is the core of ‑‑
LISTNUM 1 \l 16630 COMMISSIONER DUNCAN: That is really the answer, I think, that I was looking for. Thank you.
LISTNUM 1 \l 16631 The analog shutdown date ‑‑ you indicate that you favour what you call a "date certain deadline" for the shutdown. I am wondering what factors you think the Commission should consider in determining that date.
LISTNUM 1 \l 16632 MR. SMITH: Our platforms are 100 percent digital, so we are not directly impacted by this date, which is why we have not put forward a specific date.
LISTNUM 1 \l 16633 We do favour the Commission establishing a date certain, and the reason for that is because we think that one of the biggest threats that we face is the Canadian broadcasting services falling too far behind our neighbours across the border. If there is a wealth of high definition services available either over the air, using digital terrestrial equipment, or through the BDUs in America, then more customers in Canada will migrate to sources of programming from the States.
LISTNUM 1 \l 16634 We think that our best defence against that is to continue to provide a really strong programming offering to Canadian consumers; and allowing the industry to fall behind by not setting a date certain, or setting a date certain a long time after the States, will give significant assistance to that market that Mr. Shaw and his team were referring to. You can easily go and buy a Direct‑TV Box or an Echostar Box and watch American programming today.
LISTNUM 1 \l 16635 We don't want customers to want to do that. We want them to feel that they are getting good services from Canadian BDUs and Canadian broadcasters.
LISTNUM 1 \l 16636 COMMISSIONER DUNCAN: You are probably aware of some of the other dates that have been suggested ‑‑ the end of 2010; August 2011.
LISTNUM 1 \l 16637 Do you have a date that you would like to apply to date certain, or would you just leave that to the Commission?
LISTNUM 1 \l 16638 MR. SMITH: We would leave that to the Commission.
LISTNUM 1 \l 16639 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 16640 You state that if the Commission determines that a higher percentage of funding should go towards the small‑market fund, DTH licensees could contribute up to 2 percent of their gross broadcasting revenues to the CAB fund, rather than the current .4 percent.
LISTNUM 1 \l 16641 These funds, you suggest, would come from the CTF.
LISTNUM 1 \l 16642 We wanted to explore with you, given that ExpressVu is a national service which derives its revenues from subscribers across the country, would it be appropriate for this money to be directed to the 11 small markets that serve the 17 stations, at the expense of a national funding agency like the CTF?
LISTNUM 1 \l 16643 Did you consider that when you made your comments?
LISTNUM 1 \l 16644 MR. FRANK: I think the key element of that statement is "if".
LISTNUM 1 \l 16645 We certainly understand what you are saying, but it was only a question of ‑‑
LISTNUM 1 \l 16646 If the Commission saw the value that this independent fund is bringing to the small‑market independents, and if the Commission felt there was capacity within those local independents to effectively utilize additional funds for incremental programming, then we thought that would be something that you might be interested in.
LISTNUM 1 \l 16647 It is not that we are advocating that, but we would note that cable is able to divert slightly less than 2 percent ‑‑ or 2 points of its 5 points, excuse me, to community channels.
LISTNUM 1 \l 16648 There is a case to be made that local broadcasters are our community channel, and that, if we could set aside a similar amount of money, using the cable model, that money could go to incremental programming for small‑market broadcasters, or perhaps even large‑market broadcasters, if you felt, in your wisdom, that that would help make those services more competitive in the 500‑channel universe.
LISTNUM 1 \l 16649 That was the thrust of it. We weren't advocating it, necessarily, but I take it that the point of this hearing is to flesh out ideas ‑‑ or flush out ideas ‑‑ and that was the intent.
LISTNUM 1 \l 16650 COMMISSIONER DUNCAN: Thank you very much. That's helpful.
LISTNUM 1 \l 16651 There is one last question that I have. In the absence of transmitters, how should cable priorities be determined?
LISTNUM 1 \l 16652 This would apply, I think, more to your DSL service ‑‑ IPTV ‑‑ than to ExpressVu, but I would like to explore it.
LISTNUM 1 \l 16653 I am not sure if it applies as much to Bell ExpressVu, but I want to know how you think that local, regional and extra‑regional signals should be determined and defined in the regulations in the absence of over‑the‑air transmitters.
LISTNUM 1 \l 16654 MR. SMITH: I'm not sure I understand the question, I'm sorry.
LISTNUM 1 \l 16655 Let me confer with my colleague.
LISTNUM 1 \l 16656 COMMISSIONER DUNCAN: Maybe it is not something that you want to address, and that's okay too, but because they are broadcast over‑the‑air cable carriage is determined by where their signal reaches, the contours they reach, and the local signals, regional signals and extra regional signals, which all tie back into the over‑the‑air transmitter.
LISTNUM 1 \l 16657 So once the transmitters are gone, I'm just wondering how you think that carriage should be determined?
LISTNUM 1 \l 16658 MR. SMITH: I think my understanding of the broadcaster's proposals ‑‑ specifically I am referring to the hybrid proposals that we have vocally supported ‑‑ is, in the major markets, that there would still be digital terrestrial over‑the‑air broadcasting available. So in the major markets I don't think it would be an issue. It wouldn't change the existing regime.
LISTNUM 1 \l 16659 I think the Commission's foresight over the years in developing a competitive BDU market through provisioning for DTH, there are two DTH providers available to all consumers. I think in 90 percent of Canadian households there is a cable option, so Canadian consumers have a very, very wide range of options available to them for a source of services.
LISTNUM 1 \l 16660 The final question remains as to whether there needs to be a replacement for the over‑the‑air services outside the major markets. That was the subject of the hybrid discussion.
LISTNUM 1 \l 16661 Does that answer the Commissioner's question? I'm not sure.
LISTNUM 1 \l 16662 COMMISSIONER DUNCAN: That's sufficient. Thank you.
LISTNUM 1 \l 16663 That's all my questions, Mr. Chairman. Thank you.
LISTNUM 1 \l 16664 THE CHAIRPERSON: Thank you very much.
LISTNUM 1 \l 16665 Commissioner Cugini...?
LISTNUM 1 \l 16666 COMMISSIONER CUGINI: Good morning, gentlemen. Just a couple of questions.
LISTNUM 1 \l 16667 I have here your printout from your website of the lineup on ExpressVu and I notice that there is a section that says "Additional hardware required for the following channels".
LISTNUM 1 \l 16668 Are those the services that are on Nimiq 2?
LISTNUM 1 \l 16669 MR. FRANK: They are the services that come from 82.0E, yes.
LISTNUM 1 \l 16670 COMMISSIONER CUGINI: I want to look at it from the perspective of your customer and on the impact on these services that you carry that require additional hardware.
LISTNUM 1 \l 16671 MR. FRANK: Right.
LISTNUM 1 \l 16672 COMMISSIONER CUGINI: So if I want to receive CTV HD in my home, what am I required to purchase?
LISTNUM 1 \l 16673 MR. FRANK: All of our HD services come from 82.0E. The two key business drivers for adding capacity at 82.0E were (a) to be able to grow our business, but (b) to have backup in case we ran into an in‑orbit problem at 91.
LISTNUM 1 \l 16674 So the route for expansion 82.0E and all of our HD services are there, so you would need an additional feedhorn and additional wiring in your home to accommodate reception at 82.0E
LISTNUM 1 \l 16675 COMMISSIONER CUGINI: Is there an additional cost to the customer in order to receive these, in terms of hardware firstly?
LISTNUM 1 \l 16676 MR. FRANK: We have a variety of offers in the marketplace dependent on what the customer is ordering. So in some cases it is available free, in other cases there is a slight charge, yes.
LISTNUM 1 \l 16677 COMMISSIONER CUGINI: You also include some local signals on the 82.0E.
LISTNUM 1 \l 16678 MR. FRANK: That's correct.
LISTNUM 1 \l 16679 I would hasten to point out that many of those are part of the comprehensive deal that we struck with the CAB some four years ago, in those cases where customers were moved or new customers have been dealt with either on a free or highly subsidized basis.
LISTNUM 1 \l 16680 COMMISSIONER CUGINI: Highly subsidized in terms of the equipment that they will require in order to receive ‑‑
LISTNUM 1 \l 16681 MR. FRANK: Additional equipment, that's correct.
LISTNUM 1 \l 16682 COMMISSIONER CUGINI: I heard you, Mr. Smith, when you said that if we were to require the addition of all local stations it would be disastrous.
LISTNUM 1 \l 16683 I note they are your business decisions, but I am curious as to why you would carry some and not all.
LISTNUM 1 \l 16684 We heard OMNI yesterday saying OMNI 10 and 11 should be carried; we heard Global that said that Red Deer and ‑‑ it escapes me right now ‑‑ should also be carried.
LISTNUM 1 \l 16685 So why some and not ‑‑ what is the process that goes into making that decision?
LISTNUM 1 \l 16686 MR. SMITH: It is a compromise, and a very important one for the Commission to be fully aware of, that, as I explained, satellite technology is very good at delivering a signal across a wide area to a large number of customers. It is a very inefficient way of delivering a signal to a very small number of customers. A community of 10,000 or something, you just wouldn't use satellite for that unless it was a very unusual circumstance.
LISTNUM 1 \l 16687 So what we have ended up with, through both a combination of the effects of the regulatory regime that we operate under and the commercial negotiations that have taken place that Chris has referred to on a number of occasions through this hearing, we have ended at a compromise, and that compromise is that we carry 70‑plus of the local services and not 50.
LISTNUM 1 \l 16688 It is a compromise that can be adjusted, but it is the compromise between using our bandwidth for services which don't generate incremental business benefit for our business, therefore allowing us to generate incremental business benefit to fund all of the developments of the platform and the investment in, for example, new satellite services for high definition and, on the other hand, giving sufficient carriage to the broadcasters to, first of all, meet consumer demands, because the consumer is the end, the most important feature in here in many respects, and also meet their desires for local content and local advertising.
LISTNUM 1 \l 16689 That compromise has been struck and it has been successful struck for the last few years at the levels we have.
LISTNUM 1 \l 16690 Yes, I'm sure the broadcasters want the other 50 channels, but the incremental value to them in our terms would be significantly outweighed by the cost to the BDU business, and specifically the DTH business. We would not be able to carry anywhere near the amount of specialty pay and high definition services that we currently have, and it is those services as much as the local broadcasting services which are driving value into the broadcasting industry.
LISTNUM 1 \l 16691 As we pointed out earlier in the hearing, in fact in our opening statement, our profitability is still significantly less than the broadcasters that are seeking these fees for carriage from us and the additional carriage.
LISTNUM 1 \l 16692 We are not a pot of money, we can't fund all this stuff as a charity to the industry, we have to have something that works as well.
LISTNUM 1 \l 16693 COMMISSIONER CUGINI: Thank you very much.
LISTNUM 1 \l 16694 Thank you, Mr. Chairman.
LISTNUM 1 \l 16695 THE CHAIRPERSON: Commissioner Williams...?
‑‑‑ Pause
LISTNUM 1 \l 16696 COMMISSIONER WILLIAMS: Mr. Smith, earlier this morning we received the views of Shaw Communications on the effectiveness of the Canadian Television Fund.
LISTNUM 1 \l 16697 Could we please have the views of Bell on the effectiveness of this specific funding mechanism?
LISTNUM 1 \l 16698 MR. SMITH: I'm going to ask my colleague Mr. Frank to speak to that because I think he is one of the architects of the arrangements that exist.
LISTNUM 1 \l 16699 Chris...?
LISTNUM 1 \l 16700 COMMISSIONER WILLIAMS: Mr. Frank...?
LISTNUM 1 \l 16701 MR. FRANK: Thank you.
LISTNUM 1 \l 16702 I think there were two elements to the Shaw panel's comments on the CTF: (a) its effectiveness in promulgating new Canadian programs and (b) DTH's inability to get a seat on the Board.
LISTNUM 1 \l 16703 In respect of programming, I have to say that generally speaking we would like to be in a regime where we leave the programming of conventional specialty and pay services to the experts in the various companies, and the same with the independent funds.
LISTNUM 1 \l 16704 So we don't have any comment in specific, but we have noticed that there have been a number of reorganizations, new concepts at the CTF which is focusing on streamlining the Board and getting more quicker and more effective decision. That we applaud, any reorganization that would do that.
LISTNUM 1 \l 16705 We, like Shaw, are very anxious to have a seat on the Board. Currently, one Board seat is allocated to DTH and I think it is fair to say that in this competitive climate neither of the two DTH companies can agree on an equitable sharing arrangement.
LISTNUM 1 \l 16706 Perhaps I'm mischaracterizing. One of the DTH companies would like to see two Board seats and the other would like ‑‑ is prepared to share the existing Board seat ‑‑ I'm trying to be small "p" political here, it's a bit difficult ‑‑ and then work from within the system to see if we can acquire a second Board seat.
LISTNUM 1 \l 16707 So we would like to be a part of the CTF and look forward to the point at which we can actually have a seat on the Board. As it is an independent fund, we will make our comments known at the time we get on the Board.
LISTNUM 1 \l 16708 Canadian programming is important, it differentiates us from our unregulated competitors from south of the border, so we are fully supportive of the general initiative and glad to see our 5 percent is being used to promulgate new Canadian programming.
LISTNUM 1 \l 16709 COMMISSIONER WILLIAMS: Thank you, Mr. Frank.
LISTNUM 1 \l 16710 Thank you, Mr. Chair. That is my question.
LISTNUM 1 \l 16711 THE CHAIRPERSON: Thank you very much, Mr. Williams.
LISTNUM 1 \l 16712 Mr. Smith, or maybe one of your colleagues, earlier this morning when we discussed with Shaw, and again when we discussed with you and your team regarding various costs, one of the considerations that we are having here currently is the related costs of uplinking and carrying an analog over‑the‑air signal versus the carriage of an analog HD signal.
LISTNUM 1 \l 16713 Are there major differentials in these costs and what are they?
LISTNUM 1 \l 16714 MR. SMITH: As I explained earlier, Commissioner Arpin, there is a large chunk of fixed cost which is currently we do not have any pre‑established mechanism of allocating that cost on a megabyte basis or on a channel basis, so there is just a large chunk of cost that we bear as a cost of doing business. The only real costs which we can identify as being separately incremental for each channel is the satellite transponder, which we have quoted the cost to the Commission.
LISTNUM 1 \l 16715 I can certainly take it as an action to give some thought to this and provide some further information to the Commission if they would find it useful.
LISTNUM 1 \l 16716 THE CHAIRPERSON: I think we will find it useful if you could do it, please.
LISTNUM 1 \l 16717 MR. SMITH: Part of the discussion that we have had over the last couple of days had to do with the francophone market where, as you probably heard, the two major cable BDUs are supporting the idea of a fee for carriage for the francophone TVA and TQS service.
LISTNUM 1 \l 16718 Does ExpressVu have a different point of view on that than the ones that Shaw expressed earlier today? So was CCSA, as a matter of fact. They said the same thing as Shaw.
LISTNUM 1 \l 16719 MR. SMITH: To the extent that these channels, these broadcasters are seeking fee for carriage for their services, I wouldn't want to differentiate them from any of the English language services or any of the services which could fall into this category.
LISTNUM 1 \l 16720 With regard to the size of their proposed fees, I thought they were outrageous, but that is a personal view again.
LISTNUM 1 \l 16721 THE CHAIRPERSON: All right.
LISTNUM 1 \l 16722 MR. SMITH: Chris, do you have anything to add?
LISTNUM 1 \l 16723 THE CHAIRPERSON: I think for the record that is really ‑‑
LISTNUM 1 \l 16724 MR. FRANK: Well, I would note one of the two integrated broadcasters that were in front of you, and perhaps both, are agreeing to fee for carriage on the basis that there is a rebalancing of rates between specialty and pay and conventional broadcasting.
LISTNUM 1 \l 16725 THE CHAIRPERSON: Surely one is saying that.
LISTNUM 1 \l 16726 MR. FRANK: Yes, surely one is saying that.
LISTNUM 1 \l 16727 THE CHAIRPERSON: The other one we are going to hear after you and their written submission doesn't address that issue.
LISTNUM 1 \l 16728 MR. FRANK: that sounds like robbing Peter to pay Paul.
LISTNUM 1 \l 16729 I think our position, as Gary said, is that we are opposed to fee for carriage, both in principle and in actual fact.
LISTNUM 1 \l 16730 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 16731 Mr. Smith, in replying to one of the very first questions Mrs. Duncan asked you, you mentioned that the fee for carriage was some kind of a tax.
LISTNUM 1 \l 16732 Could you elaborate on the legal consideration that the fee for carriage could be a tax that will be levied following a CRTC policy?
LISTNUM 1 \l 16733 MR. SMITH: I was worried that you didn't have any questions for my colleague Mr. Elder, so I will happily pass the microphone to him.
LISTNUM 1 \l 16734 THE CHAIRPERSON: There are a few. They are coming.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16735 MR. ELDER: Because, as you can see, I'm clearly not here for eye candy.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 16736 MR. ELDER: I think we can appropriate it from two senses.
LISTNUM 1 \l 16737 One, I think if you take it from a customer perspective and look at what is being proposed, to the extent we can nail down what is being proposed, I think the requirement that BDUs collect money and hand it over to another party to underwrite the activities of another party I think most people would understand to be a tax and would use the term in that sense.
LISTNUM 1 \l 16738 There is no perceived value, or additional perceived value to the consumer. In essence, it purports to apply changes to an unencrypted free over‑the‑air wireless service.
LISTNUM 1 \l 16739 And it divides consumers into two groups, the taxed, which would be BDU subscribers, and the tax exempt, which would be traditional over‑the‑air viewers, anybody who has an antenna, rabbit ears, or a coat hangar for that reason.
LISTNUM 1 \l 16740 I think it is difficult to square this with the concept of a subscription fee. If only some people have to pay the fee and others don't, I don't think that fee is clearly tied to the reception of the signal.
LISTNUM 1 \l 16741 I think looking at the legal test, I think in pith and substance the purpose is to raise revenue. As we note in our brief, I think it meets the five‑prong test outlined by the Supreme Court.
LISTNUM 1 \l 16742 Additionally, and most importantly I suppose, I think it fails the regulatory charge test or the regulatory charge exception in that test.
LISTNUM 1 \l 16743 I think if you look at the case law, regulatory charge does not mean any charge that might be levied pursuant to a scheme of regulation or that might be purportedly for regulatory purpose. They fall into very definite sort of categories where there are sort of user fees like a water supply charge or a fee for the registration of a title of land.
LISTNUM 1 \l 16744 Sometimes they have social policy elements, so they could be like a markup on imported liquor that is really designed to encourage a domestic industry, or energy conservation where the pricing or whatever is designed to disuade people from using certain types of fuels.
LISTNUM 1 \l 16745 Finally, there is this notion of regulatory charges where there is a relationship between the fee and the benefit or the need for certain services, so fees for removal of gravel I think was one that has been found as a regulatory charge and it's raised sufficient revenue to cover the costs of the regulatory scheme and the building and maintenance of the roads over which the gravel trucks would travel, or an education fee paid by developers where there was a relationship between the development and the need to build new schools and so the developers were on the hook for helping to subsidize the building of those schools.
LISTNUM 1 \l 16746 I don't see in the case law a situation like this where there is a general regulatory purpose which is the creation and presentation of Canadian programming ‑‑ I think that is where we are going on this ‑‑ and found to be a regulatory charge.
LISTNUM 1 \l 16747 In fact, there was some discussion earlier in this hearing about the Westbank case, and if we look at the Westbank case itself, there it was by way of a by‑law but it was essentially like a property tax. The intention was to levy funds in order to promote the interests of aboriginal peoples and further the aims of self‑government. That was the overarching purpose.
LISTNUM 1 \l 16748 The Court distinguished that overarching purpose from the very specific purpose, which it said was really simply to raise revenue.
LISTNUM 1 \l 16749 I think similarly here where we migh say there is an overarching purpose of filling the objectives of the Broadcasting Act or the creation and presentation of Canadian programming, I think the very specific purpose here is transferring wealth from one set of industry players to another.
LISTNUM 1 \l 16750 For those reasons I think this does qualify as a tax under Canadian law.
LISTNUM 1 \l 16751 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 16752 Mr. Smith, in your oral presentation at the bottom of page 6 this morning you mentioned the WIPO discussion in Geneva. I don't want to enter into that, but your second sentence says:
"U.S. broadcasters want to receive fees from Canadian BDUs from the carriage of their local signals to Canadian households." (As read)
LISTNUM 1 \l 16753 Other than through discussions at WIPO, do you have any other evidence that they are looking for their ‑‑ obviously they are interested in receiving a carriage fee, but do you have other evidence that they are pressing for a fee for carriage?
LISTNUM 1 \l 16754 MR. SMITH: I was certainly referring there to the discussions which were taking place around the WIPO Treaty.
LISTNUM 1 \l 16755 I would open it to my colleagues if anyone wishes to contribute.
LISTNUM 1 \l 16756 MR. ELDER: I think it mainly is through WIPO. I think popular wisdom is that in fact the current retransmission regime that we have for distant signals was provoked by pressure from U.S. broadcasters.
LISTNUM 1 \l 16757 I don't think it is ‑‑ I think it is a truth that they want access to some of our money.
LISTNUM 1 \l 16758 MR. FRANK: Commissioner, Vice‑Chair Arpin ‑‑
LISTNUM 1 \l 16759 THE CHAIRPERSON: Yes...?
LISTNUM 1 \l 16760 MR. FRANK: ‑‑ I would just reinforce the comments made by the Rogers panel when they went back to the '70s and emphasized the kerfuffle between the U.S. border broadcasters and the regulatory regime of program substitution ‑‑ well, first commercial deletion and its successor program substitution as indication that American broadcasters won't be shy in terms of representing their appetite for additional revenues.
LISTNUM 1 \l 16761 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 16762 On the copyright side, do you have any comments to make regarding specifically the argument that was developed by the broadcasters in their legal opinion regarding copyright?
LISTNUM 1 \l 16763 From your own standpoint, does the Copyright Act already cover the notion of fee for carriage?
LISTNUM 1 \l 16764 MR. ELDER: Again, it is a little difficult because trying to nail down this concept of fee for carriage is a bit like nailing jello to a wall. Even the broadcasters don't seem to agree amongst themselves.
LISTNUM 1 \l 16765 But if we look at it as being compensation for the value in this unencrypted over‑the‑air free broadcast signal, we think that is copyright.
LISTNUM 1 \l 16766 I do think, and I would agree with the telco TV panel on this front, that the federal government, the elected parliament of Canada, has considered this issue and has decided not to include in copyright legislation the recognition for this type of a signal right.
LISTNUM 1 \l 16767 So I would think it would be, well, let's say passing strange at best, for the Commission under the guise of the Broadcasting Act to second guess parliament in that regard and create such a right.
LISTNUM 1 \l 16768 THE CHAIRPERSON: But will you agree that we are talking here about two different statutes and there could be two different rights?
LISTNUM 1 \l 16769 MR. ELDER: I still don't think ‑‑ I mean, just because you don't call it copyright I don't think removes it from the Copyright Act.
LISTNUM 1 \l 16770 I think parliament, as they divide up jurisdiction and hand authority to various pieces of legislation and various regulatory boards, they have in mind what they are handing out and I think if it is about what is in essence a property right in a signal, in an intellectual property, I think that is copyright and I don't think you can do that unde the Broadcasting Act.
LISTNUM 1 \l 16771 THE CHAIRPERSON: If there was no more over‑the‑air broadcasting and all the system would be carried through BDU, will you say that then for the broadcasters rather than being Tariff 2A it will be Tariff 17 that will apply? Then it will mean that you are going to have to share the load.
LISTNUM 1 \l 16772 MR. ELDER: I suppose it would be. It is difficult to see exactly ‑‑
LISTNUM 1 \l 16773 THE CHAIRPERSON: Unless parliament amends the Copyright Act. Obviously I'm taking it from ‑‑
LISTNUM 1 \l 16774 MR. ELDER: Right. I mean, in a way it is difficult to say whether in fact that would make current over‑the‑air broadcasters specialty services, the way we currently understand the term, which have been from their inception kind of narrowcast, partly subscription fee supported services. We would be creating almost another sort of category to the extent that over‑the‑air broadcasters would maintain their kind of general ‑‑ their mass audience focus.
LISTNUM 1 \l 16775 Obviously it is going to get very complicated if they are going to continue to have separate services like that for each market rather than sort of one national service or an east‑west thing.
LISTNUM 1 \l 16776 I guess in that situation hypothetically I would agree that 17 would apply.
LISTNUM 1 \l 16777 THE CHAIRPERSON: At the beginning of this hearing the Commission announced that they had accepted and put on the record a Nordicity study that was provided to the Commission by CIEL.
LISTNUM 1 \l 16778 Do you have any comments, now that your Mr. Hansen made available some comments that he had provided to Nordicity and he has reserved the right to make further comments.
LISTNUM 1 \l 16779 Do you have anything else you want to add?
LISTNUM 1 \l 16780 MR. SMITH: I have nothing, Commissioner, offhand, but I would invite my colleagues to contribute if they feel the need.
LISTNUM 1 \l 16781 MR. FRANK: Simply to note, as Paul did I believe in an e‑mail, that the number of pay‑per‑view services are significantly overstated.
LISTNUM 1 \l 16782 THE CHAIRPERSON: Exactly, yes.
LISTNUM 1 \l 16783 MR. FRANK: I think we would like the opportunity to go through it in detail, because there was no dialogue, of if there was dialogue it was very, very limited, between us and Nordicity and the people who I think know our business plan best are ourselves. So we would like to go through it and comment to you.
LISTNUM 1 \l 16784 THE CHAIRPERSON: You will have an opportunity to file something before December 20th.
LISTNUM 1 \l 16785 MR. FRANK: Yes.
LISTNUM 1 \l 16786 THE CHAIRPERSON: Legal counsel...?
LISTNUM 1 \l 16787 MS CRUISE: Thank you, Mr. Chair.
LISTNUM 1 \l 16788 I just have one question and I believe it is for Mr. Elder.
LISTNUM 1 \l 16789 In your submission you commented on the WIPO Broadcasting Treaty and you stated that if Canada ratified the treaty and the new rights were granted to foreign broadcasters that out of necessity the rights would be granted to domestic over‑the‑air broadcasters.
LISTNUM 1 \l 16790 I just wanted to clarify if what you are suggesting is that it would be a legal requirement or if it would be some other type of requirement.
LISTNUM 1 \l 16791 MR. ELDER: I guess strictly speaking I would say it would not be a legal requirement because it is up to Canada, I guess, what treaties it wants to sign onto and whether it can negotiate any exemptions or not.
LISTNUM 1 \l 16792 I guess what we are saying here is, certainly there would be very strong pressure on Canada to allow that kind of a right. As we talked about a bit earlier, the U.S. has been exerting that pressure for some time on us.
LISTNUM 1 \l 16793 I guess we think that if the CRTC, for example, was to create what we think amounts to a signal right, in fact this could be very provacative to the U.S. in the context of the WIPO talks.
LISTNUM 1 \l 16794 If I was sitting at the negotiating table for Canada I would hate to have to try to explain that away and maintain the Canadian position that there shouldn't be signal rights and they should be exempted.
LISTNUM 1 \l 16795 MS CRUISE: Thank you.
LISTNUM 1 \l 16796 That's all.
LISTNUM 1 \l 16797 THE CHAIRPERSON: Mr. Smith, gentlemen, thank you very much for your presentation.
LISTNUM 1 \l 16798 We will take a 10‑minute break. We will get back with the next intervenors at a quarter to 12:00.
LISTNUM 1 \l 16799 MR. SMITH: Thank you very much.
‑‑‑ Upon recessing 1135 / Suspension à 1135
‑‑‑ Reprise à 1149 / Resuming at 1149
LE PRÉSIDENT: Order, please. À l'ordre, s'il vous plaît.
LISTNUM 1 \l 16800 Madame la Secrétaire ?
LISTNUM 1 \l 16801 Merci, Monsieur le Président.
LISTNUM 1 \l 16802 Nous procéderons maintenant à la prochaine présentation, qui est de Cogeco Inc., et monsieur Yves Mayrand introduira son groupe de présentation.
LISTNUM 1 \l 16803 Après quoi, vous aurez 15 minutes pour votre présentation.
LISTNUM 1 \l 16804 Monsieur Mayrand?
PRÉSENTATION / PRESENTATION
LISTNUM 1 \l 16805 M. MAYRAND : Merci, Madame la Secrétaire.
LISTNUM 1 \l 16806 Bonjour, Monsieur le Président et membres du Conseil.
LISTNUM 1 \l 16807 Nous vous remercions de votre invitation à comparaître, et nous espérons pouvoir contribuer utilement à votre examen du cadre réglementaire de la télévision conventionnelle.
LISTNUM 1 \l 16808 Je suis Yves Mayrand, Vice‑président, Affaires corporatives de COGECO inc. Me Caroline Dignard, Directrice, Affaires juridiques, est à ma droite et monsieur Éric Simon, Directeur, Planification financière, est à ma gauche.
LISTNUM 1 \l 16809 Permettez‑moi d'abord de situer brièvement notre groupe et nos observations.
LISTNUM 1 \l 16810 COGECO est une compagnie à capital ouvert dont les titres subalternes sont inscrits à la Bourse de Toronto.
LISTNUM 1 \l 16811 COGECO est indirectement l'actionnaire de contrôle de TQS, une compagnie à capital fermé qui a comparu plus tôt cette semaine et dont l'autre actionnaire est CTV Television Inc., une société du groupe Bell Globemedia.
LISTNUM 1 \l 16812 COGECO est aussi l'actionnaire de contrôle de Cogeco Câble inc., une société à capital ouvert dont les titres subalternes sont également inscrits à la Bourse de Toronto et qui constitue le deuxième plus grand câblodistributeur respectivement en Ontario, au Québec et au Portugal.
LISTNUM 1 \l 16813 Les activités de câblodistribution représentaient 83 pour cent des produits consolidés de COGECO pour le dernier exercice financier terminé le 31 août dernier.
LISTNUM 1 \l 16814 C'est pourquoi nous avons décidé de soumettre des observations séparément de celles de notre filiale de télédiffusion, et c'est pourquoi nous nous abstiendrons de commenter spécifiquement sur les représentations de celle‑ci.
LISTNUM 1 \l 16815 Notre groupe représente en quelque sorte un modèle réduit du système canadien de radiodiffusion.
LISTNUM 1 \l 16816 Je dois cependant préciser que notre groupe n'a pas d'intérêt de propriété, et encore moins de contrôle, dans des services spécialisés ou télévision payante.
LISTNUM 1 \l 16817 Les positions que nous exprimons traduisent la nécessité d'assurer un juste équilibre entre les divers intérêts présents au sein de notre système de radiodiffusion pour les années à venir, une préoccupation que vous partagez sans doute dans le cadre de cette importante audience publique.
LISTNUM 1 \l 16818 L'équilibre, l'équité et l'interdépendance entre les divers éléments et groupes d'intérêt en présence sont à la source du succès remarquable de notre système canadien de radiodiffusion au cours des 75 dernières années.
LISTNUM 1 \l 16819 Notre système a toujours réussi jusqu'à présent à s'adapter aux changements technologiques et économiques en trouvant de nouveaux points d'équilibre.
LISTNUM 1 \l 16820 Il en va de même encore aujourd'hui, et le défi n'est pas insurmontable, même sur la question des frais d'abonnement et du passage à la télédiffusion en haute définition.
LISTNUM 1 \l 16821 Nous avons clairement pris position en faveur de l'élargissement des frais d'abonnement aux réseaux privés de télévision conventionnelle, comme il en existe déjà depuis fort longtemps pour les services de télévision spécialisés, avec cependant certaines précautions dont je parlerai dans quelques instants.
LISTNUM 1 \l 16822 Nous avons réservé jusqu'à nouvel ordre notre position sur l'élargissement des frais d'abonnement aux réseaux de télévision conventionnelle du secteur public, essentiellement pour trois raisons.
LISTNUM 1 \l 16823 Premièrement, les réseaux du secteur public ont déjà accès à au moins deux sources de financement indépendantes et substantielles, soit les crédits de fonctionnement et d'immobilisations de l'État, et les recettes publicitaires, et aussi dans certains cas d'autres sources de fonds importantes, notamment des frais d'abonnement pour leurs propres services spécialisés.
LISTNUM 1 \l 16824 Deuxièmement, le problème de financement des émissions de la télévision conventionnelle privée, particulièrement dans le marché francophone, est sérieux et nécessite un correctif rapide.
LISTNUM 1 \l 16825 Troisièmement, le Conseil devrait connaître les nouveaux paramètres du mandat des chaînes publiques avant de leur attribuer de nouveaux frais d'abonnement.
LISTNUM 1 \l 16826 Ceci étant dit, il importe d'abord et avant tout de mettre rapidement fin à l'exclusivité dont jouissent présentement les services spécialisés sur l'accès aux frais d'abonnement.
LISTNUM 1 \l 16827 Si elle avait sa justification pour la phase de développement des services spécialisés, cette exclusivité n'a plus sa place dans un environnement de large choix et de maturité de ces services.
LISTNUM 1 \l 16828 Our position on fair access to subscription fees differs from the position of many cable or satellite distribution undertakings.
LISTNUM 1 \l 16829 You are probably wondering why. Here are our reasons, which we feel are, quite frankly, compelling.
LISTNUM 1 \l 16830 First, the monitoring reports and the statistical and financial data of the Commission demonstrate without a shadow of a doubt that the growth of specialty and pay television services, whose proliferation and remarkable performance constitutes unquestionably a great accomplishment, unfolds increasingly to the detriment of the audience and advertising revenue of conventional television services, which remain however the pillars of the Canadian system that bear the weight of producing the most expensive programs and providing local services.
LISTNUM 1 \l 16831 Second, the statistical and financial data of the Commission shows that the basic services of the large cable distribution undertakings and the satellite and microwave distribution undertakings, which depend in good measure on the distribution of conventional television signals, have generated direct and indirect subscription revenue of approximately 2.3 billion dollars in 2005 compared to approximately 1.7 billion in 2001, an increase of more than 34 per cent over the last five years.
LISTNUM 1 \l 16832 The growth in basic subscription revenue over that period is mainly attributable to satellite distribution undertakings, which presently distribute a comparatively smaller number of local conventional televisions to the pool available.
LISTNUM 1 \l 16833 Third, the statistical and financial data of the Commission shows that subscription revenue of the large cable distribution undertakings and the satellite and microwave distribution undertakings from their non basic services, which depend mainly on the distribution of specialty and pay television services, went from approximately 1.8 billion dollars in 2001 to approximately 2.3 billion dollars in 2005, a 30 per cent increase over the last five years.
LISTNUM 1 \l 16834 These same distribution undertakings made affiliation payments of approximately 1.2 billion dollars to specialty and pay television services in 2005, compared to approximately 873 million dollars in 2001, an increase of over 40 per cent over the last five years.
LISTNUM 1 \l 16835 While affiliation payments represented approximately 49 per cent of subscription revenue derived from non‑basic services in 2001, they reached approximately 53 per cent of such subscription revenue in 2005.
LISTNUM 1 \l 16836 Fourth, media that are not regulated by the Commission have no regulatory obstacle preventing them from using subscription revenue as well as advertising revenue.
LISTNUM 1 \l 16837 To those who argue that conventional television is `free', we can only observe that it is no longer `free' for almost nine out of every ten households in Canada, but that it otherwise remains `free' to broadcasting distribution undertakings due to pure regulatory arbitrage.
LISTNUM 1 \l 16838 To those who say that it would not be appropriate to direct subscription fees to a conventional television sector that is in trouble, we reply that the trouble of this sector is mainly due to a differential treatment which is no longer warranted.
LISTNUM 1 \l 16839 Finally, to those who say that there are possibly too many conventional television networks given the current capacity of the market, we reply that none of the existing television services in Canada would be viable in the absence of a regulatory framework, including specialty and pay television services, and that diversity of Canadian information and entertainment sources is in the public interest, including in television for mass audiences.
LISTNUM 1 \l 16840 This is why we feel it is not defensible to continue excluding conventional television from access to subscription fees via the regulatory framework.
LISTNUM 1 \l 16841 It would be a tragic and irreparable mistake, particularly in a market as confined as the Francophone market in Canada, to resign ourselves to the shrinking, and eventually the demise, of the major conventional television networks as a result of our failure to restore on a timely basis a balance in the use of financial resources available within the Canadian broadcasting system.
LISTNUM 1 \l 16842 The entire system would be seriously diminished, and Canadian viewers as well as Canadian talent would loose a common meeting place that is more essential than ever before in this highly fragmented audiovisual universe.
LISTNUM 1 \l 16843 N'oublions surtout pas que ce sont les grands réseaux de télévision conventionnelle qui soutiennent les plus grandes productions télévisuelles canadiennes pour les plus larges auditoires, que nos producteurs indépendants, nos talents et nos artistes dépendent encore largement de cet élément du système canadien pour rejoindre leur public, et que nos concitoyens dépendent encore très largement de ce moyen de communication tant pour combler leurs besoins individuels que pour soutenir les besoins de leur collectivité locale.
LISTNUM 1 \l 16844 Ce sont ces mêmes réseaux qui contribuent à la pénétration élevée et à la valeur perçue du volet de base, et indirectement des volets facultatifs, auprès des consommateurs.
LISTNUM 1 \l 16845 Bref, la télévision en direct fait partie des fondations de l'édifice, et les fondations ont un sérieux besoin d'entretien avant que les lézardes ne deviennent irréparables et que tout l'édifice ne soit mis en péril.
LISTNUM 1 \l 16846 Voilà pour le principe de l'élargissement des frais d'abonnement.
LISTNUM 1 \l 16847 Trois questions fondamentales découlent de la reconnaissance de ce principe, soit : d'abord, l'établissement du niveau approprié des nouveaux frais d'abonnement pour les services de télévision conventionnelle dans leur ensemble; ensuite, la gestion de leur incidence monétaire sur les autres éléments du système de radiodiffusion; et troisièmement, leur répartition entre les entreprises visées.
LISTNUM 1 \l 16848 Sur le niveau approprié pour l'assiette globale des nouveaux frais d'abonnement, nous avons soumis dans notre mémoire qu'il serait imprudent d'établir un tel niveau avant d'avoir une compréhension claire des facteurs d'élasticité de la demande pour les volets de service des entreprises de distribution de radiodiffusion au Canada.
LISTNUM 1 \l 16849 L'état du dossier public jusqu'à ce jour démontre selon nous qu'il faut faire des analyses économiques et financières plus poussées tant pour le marché francophone que pour le marché anglophone avant de déterminer cette assiette globale pour chacun de ces marchés.
LISTNUM 1 \l 16850 Il nous semble que le Conseil devrait commander une étude complète et impartiale sur cette question et la publier avant que les titulaires de licence des réseaux conventionnels ne soient appelés à formuler leurs demandes et à comparaître pour leur prochain renouvellement de licence.
LISTNUM 1 \l 16851 Un nouveau déséquilibre du système canadien de radiodiffusion n'est manifestement pas souhaitable, et il importe donc de bien faire collectivement nos devoirs.
LISTNUM 1 \l 16852 Quant à la gestion de l'incidence monétaire sur les autres éléments du système de radiodiffusion, nous sommes d'avis qu'il faut absolument éviter un modèle selon lequel les nouveaux frais d'abonnement pour la télévision conventionnelle sont prélevés à même les ressources financières existantes des autres éléments du système de radiodiffusion, et notamment un modèle selon lequel ce prélèvement est laissé à la discrétion des entreprises individuelles.
LISTNUM 1 \l 16853 Il en résulterait inévitablement des dérapages et des litiges.
LISTNUM 1 \l 16854 Enfin, quant à la répartition de l'assiette des nouveaux frais d'abonnement, il nous semble essentiel que cette répartition soit établie par le Conseil comme ce fut le cas pour les frais de base des services spécialisés dits analogiques, en évitant des formules complexes ou variables, comme celles qui seraient basées sur les parts d'auditoire, et en assurant un terrain de jeu à niveau entre les services concurrents une fois que ces frais seront établis.
LISTNUM 1 \l 16855 Nous n'avons pas soumis d'observations sur les autres questions soulevées par le Conseil dans son avis public, puisqu'elles sont entièrement du ressort de notre filiale de télédiffusion TQS.
LISTNUM 1 \l 16856 Toutefois, nous voudrions terminer en soulignant les deux grands thèmes de la réforme du cadre de réglementation qui devraient selon nous transparaître à l'issue de la présente instance politiques.
LISTNUM 1 \l 16857 Ces thèmes reflètent un constat fondamental : en raison des technologies numériques et des médias non assujettis à la réglementation, le pouvoir de négociation des télédiffuseurs est en déclin à la fois par rapport aux producteurs d'émissions, aux talents, aux auditoires et aux annonceurs.
LISTNUM 1 \l 16858 Il faut donc, premièrement, éviter de nouvelles contraintes structurelles sur les intrants et les activités des télédiffuseurs, et au contraire leur donner une plus grande flexibilité dans leur façon de réaliser les objectifs prévus.
LISTNUM 1 \l 16859 Deuxièmement, il faut viser un cadre de réglementation simple et d'application aisée.
LISTNUM 1 \l 16860 Ces thèmes sont non seulement très pertinents au regard de l'état hautement concurrentiel des marchés, ils sont également très pertinents au regard de la politique du gouvernement canadien sur la réglementation intelligente et des principes directeurs de l'OCDE pour la qualité et la performance de la réglementation.
LISTNUM 1 \l 16861 Voilà. Nous vous remercions de votre attention et nous sommes prêts à répondre à vos questions.
LISTNUM 1 \l 16862 LE PRÉSIDENT : Merci, Monsieur Mayrand. Je pense que votre mémoire et votre présentation orale sont très clairs, mais j'aimerais élaborer quand même sur certaines des propositions que vous mettez de l'avant, notamment relativement à l'incidence de l'arrivée d'un nouveau tarif sur l'ensemble des abonnés.
LISTNUM 1 \l 16863 Je vois que vous spécifiez que vous vous abstiendrez de commenter sur les propositions qui ont été mises de l'avant par votre société affiliée, Quatre‑Saisons. Cependant, je pense qu'on ne peut pas vivre dans un processus comme celui dans lequel on est présentement sans quand même y faire référence, de part et d'autre. C'est inévitable. C'est l'objet du débat. Donc, quant à moi, je vais certainement y faire référence, et quant à vous, j'espère que vous vous sentirez à l'aise pour commenter.
LISTNUM 1 \l 16864 La première considération, évidemment, qui vient à l'esprit, après avoir entendu l'ensemble des témoignages depuis le début de l'audience, est à l'effet que les visions sont diamétralement opposées entre les exploitants d'entreprises de distribution francophones et les exploitants d'entreprises de distribution anglophones, et même aussi diamétralement opposées, du moins, c'est ce que le CCSA nous a dit hier, avec la position des deux entreprises de distribution que sont Vidéotron et Cogeco Câble, donc, que leurs membres québécois qui sont dans des petits marchés partagent l'opinion de leurs membres anglophones.
LISTNUM 1 \l 16865 Qu'est‑ce qui vous amène à croire que ‑‑ parce que, effectivement, vous remarquez qu'il n'y a pas d'étude d'élasticité ‑‑ qu'il n'y a pas d'étude pour supporter la volonté des téléspectateurs francophones à supporter leurs stations généralistes avec un tarif?
LISTNUM 1 \l 16866 M. MAYRAND : J'avais cité, apparemment, trois facteurs.
LISTNUM 1 \l 16867 D'abord, le premier ‑‑ qui, je pense, est bien documenté dans le mémoire de TQS et le sondage qui l'accompagne ‑‑ c'est que, dans la très grande majorité des cas, les Québécois, comme d'ailleurs sans doute au Canada anglais, mais en tout cas, les Québécois dans le marché francophone très largement ne réalisent pas, pour ceux qui sont abonnés soit à un service de satellite, de câble ou de micro‑ondes, qu'il n'y a aucun paiement des frais d'abonnement qu'ils versent à leur distributeur qui sert à payer pour la réception des signaux et la qualité des signaux des services conventionnels qui font partie du volet de base.
LISTNUM 1 \l 16868 Alors, clairement, quand on leur explique ce dont il en retourne, l'attitude des consommateurs québécois a tendance certainement à être, disons‑le franchement, ouverte à considérer au moins le problème.
LISTNUM 1 \l 16869 Deuxièmement, je pense que nous avons tenté par un résumé des statistiques que le Conseil compile sur les produits d'abonnement pour les volets de base que ces volets‑là ont généré une certaine croissance de revenus, nonobstant l'introduction de la concurrence, nonobstant une foule de facteurs qui auraient pu indisposer les abonnés.
LISTNUM 1 \l 16870 Alors, c'est un autre indice qu'il y a une ouverture des abonnés à considérer un réaménagement de frais pour ces services‑là.
LISTNUM 1 \l 16871 Et troisièmement, je pense que, quand on constate le degré d'attachement des Québécois à leur télévision généraliste et la pure quantité de programmation de qualité et aussi la variété de cette programmation qui est offerte au public québécois, c'est un lieu commun qui est considéré comme extrêmement important pour eux.
LISTNUM 1 \l 16872 Alors, je pense qu'on les convainc assez facilement qu'on ne serait pas très heureux de se passer de ces services‑là.
LISTNUM 1 \l 16873 Et, en fait, il y a peu de choses dans le dossier public jusqu'à présent qui tendent à documenter quelle serait l'attitude des consommateurs si les grandes chaînes généralistes n'étaient carrément plus disponibles sur le relais de base. Nous pensons que leur réaction serait sûrement assez pointue et assez critique.
LISTNUM 1 \l 16874 LE PRÉSIDENT : Vous faites état de l'étude du sondage CROP que TQS a déposée avec son mémoire. Cependant, ce sondage mesure une perception de la part des répondants qu'il y a une valeur pour les canaux généralistes, les stations généralistes qui sont offertes, mais le sondage ne va pas jusqu'à vérifier s'ils seraient prêts à verser, en sus de ce qu'ils versent présentement, les montants auxquels leur perception se réfère.
LISTNUM 1 \l 16875 Cependant, au début de l'audience, les entreprises que sont Rogers, Shaw, Bell ExpressVu et le CCSA ont déposé une étude du Strategic Council qui a mesuré l'intérêt des Québécois anglophones par rapport au paiement d'une redevance, et si je regarde, juste pour les fins de notre discussion, il y a 129 répondants anglophones sur 1 000 personnes sondées.
LISTNUM 1 \l 16876 Donc, il y a eu 129 répondants anglophones au Québec qui ont été invités à se prononcer, et 68 pour cent d'entre eux se sont dit fortement opposés au paiement d'une redevance, alors que la moyenne canadienne, c'est 65 pour cent. Donc, en fait, c'est au Québec que le commentaire a été le plus véhément, si je regarde les résultats du sondage du Strategic Council.
LISTNUM 1 \l 16877 Qu'est‑ce qui vous fait croire que les Québécois francophones auraient une attitude distincte?
LISTNUM 1 \l 16878 M. MAYRAND : Bien écoutez, je pense qu'il est plutôt admis et compris dans la Loi sur la radiodiffusion qu'il y a une différence fondamentale entre la radiodiffusion du secteur francophone et celle du secteur anglophone. Je pense qu'il y a de nombreuses manifestations pratiques et concrètes de cette différence.
LISTNUM 1 \l 16879 Alors, certainement, je vais admettre d'emblée qu'il faut faire beaucoup plus de travail pour évaluer quelle est, justement, l'élasticité de la demande de services chez les francophones. Je ne pense pas que l'étude que vous venez de mentionner le fasse. Nous vous disons qu'il y a lieu de faire ce travail‑là.
LISTNUM 1 \l 16880 Mais ceci étant dit...
LISTNUM 1 \l 16881 LE PRÉSIDENT : Elle suggère un prix, d'ailleurs, qui est beaucoup plus élevé que celui qui est le montant le plus élevé qui a été présenté par les diffuseurs francophones.
LISTNUM 1 \l 16882 M. MAYRAND : Alors, j'allais en venir à la question de la méthodologie et des plages de redevances qui sont mentionnées dans différentes études, parce qu'il y en a d'autres aussi, qui touchent principalement le marché anglophone.
LISTNUM 1 \l 16883 Alors, sans rentrer dans les considérations de méthodologie et de ce qui constitue la plage appropriée, la position que nous avons prise, nous, c'est qu'il faut faire nos devoirs de façon plus analytique sur l'élasticité de la demande pour le marché pertinent, et en ce qui nous concerne, évidemment, le marché francophone, certainement dans le cas de notre filiale TQS, est celui qui est pertinent pour ses activités.
LISTNUM 1 \l 16884 LE PRÉSIDENT : Un des intervenants, si ma mémoire est fidèle, c'est le groupe Rogers, qui a fait référence au fait que si le Conseil adoptait une proposition de tarif de redevance d'abonnement pour les stations généralistes, on se retrouverait, juridiquement, dans une situation d'option négative par rapport à la situation juridique au Québec avec la Loi sur la protection des consommateurs.
LISTNUM 1 \l 16885 Quelle est votre position quant à cette embûche potentielle?
LISTNUM 1 \l 16886 M. MAYRAND : Écoutez, je pense... d'abord, je ne peux pas m'empêcher de constater que cet obstacle est soulevé par l'entreprise qui a peut‑être eu le plus de mailles à partir, avec ce qui était, effectivement, convenu d'appeler l'option négative, lorsqu'elle fut appliquée en Ontario.
LISTNUM 1 \l 16887 Mais honnêtement, je ne pense pas qu'il s'agisse ici d'une question d'option négative. Il n'y a pas de changement proposé dans l'offre de services. Il n'y a pas introduction d'un nouveau service qui s'ajoute ou modifie le volet.
LISTNUM 1 \l 16888 D'ailleurs, il nous semble que les règles qui président à l'établissement des volets de base devraient continuer de s'appliquer, que l'on introduise un frais d'abonnement pour les services dits conventionnels ou pas.
LISTNUM 1 \l 16889 Alors, dans cet environnement‑là, il n'est pas question de changer dramatiquement le volet de base ou d'introduire de nouveaux services. On parle tout simplement du niveau... possiblement du niveau de prix pour un volet donné, et je ne pense pas que quelque loi de protection du consommateur que ce soit n'interdise des ajustements de prix.
LISTNUM 1 \l 16890 Nous avons fait, d'ailleurs, beaucoup de travail, lors de l'adoption de la nouvelle Loi de protection du consommateur en 2002 en Ontario, sur son application, et nous arrivons très bien, comme cablôdistributeur là‑bas, à nous conformer aux exigences de la loi lorsqu'il y a des ajustements de prix et à les notifier correctement et avec franchise à nos abonnés.
LISTNUM 1 \l 16891 LE PRÉSIDENT : Lors de leur comparution, Quebecor Média, pour un, et TQS, pour l'autre, ont proposé deux modèles différents de tarif d'abonnement.
LISTNUM 1 \l 16892 Un est un modèle qui est laissé à la libre négociation ‑‑ et je vois dans vos commentaires que vous ne croyez pas que ça soit la voie à suivre ‑‑ et le deuxième modèle, celui qui était mis en relief par TQS, est d'un montant, ultimement, de $1.00 en l'étalant sur deux années.
LISTNUM 1 \l 16893 Quelle est la position de Cogeco par rapport à ce modèle et par rapport au prix?
LISTNUM 1 \l 16894 M. MAYRAND : Alors, il y a deux éléments de réponse à votre question, Monsieur Arpin.
LISTNUM 1 \l 16895 Premièrement, sur le modèle, nous sommes clairement en plein appui à la position de notre filiale TQS sur le principe que les droits doivent être établis de façon neutre et objective par le Conseil et non pas laissés à une libre négociation.
LISTNUM 1 \l 16896 Et laissez‑moi préciser que dans le contexte du marché francophone et du niveau d'intégration dans ce qui prévaut dans ce marché, et de l'ampleur des exigences du cadre de réglementation, il nous apparaît insoutenable de dire qu'il peut y avoir une véritable négociation de libre marché pour tous les joueurs.
LISTNUM 1 \l 16897 Alors, d'après nous, il nous semble incontestable que le Conseil a un rôle irremplaçable à jouer et, comme nous le disions dans notre présentation orale tantôt, il faut surtout éviter de récolter une série de problèmes indésirables et de litiges qui risquent de vous embourber, de nous embourber, et de créer énormément d'instabilité et de récriminations au sein du système.
LISTNUM 1 \l 16898 Alors, c'est pourquoi le modèle de base proposé par TQS nous semble de loin préférable à celui qui a été proposé par nos vis‑à‑vis.
LISTNUM 1 \l 16899 Maintenant, quant au niveau des droits, j'ajouterais que COGECO est parfaitement d'avis qu'il faut une introduction mesurée et progressive d'un nouveau droit, quel que soit le quantum qui sera éventuellement déterminé pour ces droits.
LISTNUM 1 \l 16900 Alors, le seul point de réserve par rapport à la position de TQS c'est sur le quantum. Alors, TQS vous a offert un quantum précis. Corporativement, nous n'avons pas soumis de quantum. Nous vous avons dit, on a besoin de faire des devoirs et puis il y a 83 pour cent de notre chiffre d'affaires consolidé, et ça va en augmentant, qui représente la câblodistribution.
LISTNUM 1 \l 16901 Alors, il faut faire très attention, il faut compléter les devoirs comme il faut avant d'établir le quantum.
LISTNUM 1 \l 16902 LE PRÉSIDENT: La période d'étalement qui est mise sur deux ans est suffisante ou devrait être plus longue que deux ans?
LISTNUM 1 \l 16903 M. MAYRAND: La difficulté que nous aurions et que je pense que vous auriez à déterminer aujourd'hui, si ça doit être sur deux ans ou trois ans, par exemple, ou peut‑être même une plus longue période de temps, c'est que nous n'avons pas de vraie mesure économétrique sur l'élasticité de la demande et l'impact qui résulterait des frais qui seraient introduits dans le système.
LISTNUM 1 \l 16904 Alors, tant qu'on n'a pas ça, c'est très difficile de dire aussi quel est l'horizon temps approprié pour arriver au résultat final.
LISTNUM 1 \l 16905 Je vous dirais, cependant, et c'est un peu subjectif à ce stade‑ci, qu'il faut aussi un degré de certitude et de stabilité dans les changements qu'on apporte à la tarification et au coût des intrants.
LISTNUM 1 \l 16906 Alors, ça militerait, d'après nous, sur une période d'introduction progressive relativement courte parce qu'on ne peut pas passer notre temps à avoir des ajustements, et on est d'accord là‑dessus avec les observations qui ont été faites par d'autres... d'autres parties présentes à cette audience‑là.
LISTNUM 1 \l 16907 LE PRÉSIDENT: Ceci étant dit, COGEGO, au cours des années, a introduit des augmentations tarifaires. Disons que ça ne serait pas quand même nouveau pour vos abonnés d'avoir à faire face à des augmentations tarifaires.
LISTNUM 1 \l 16908 Vous avez quand même eu une certaine... accumulé une certaine expertise au niveau des années pour savoir quels sont les niveaux qui sont acceptables et puis je ne sais pas si vous pouvez partager avec nous les résultats de votre vécu comme exploitant?
LISTNUM 1 \l 16909 M. MAYRAND: Si le Conseil a besoin de données qui sont plus spécifiques, nous serions certainement prêts à considérer à les partager sur une base confidentielle, évidemment.
LISTNUM 1 \l 16910 LE PRÉSIDENT: Je ne cherche pas des nombres absolus, mais je parle... je cherche à comprendre la dynamique d'une augmentation de tarif et puis la réaction du consommateur.
LISTNUM 1 \l 16911 M. MAYRAND: Oui. Mais ceci étant dit, vous avez parfaitement raison de dire que COGECO et, en fait, toutes les autres entreprises de distribution de radiodiffusion, grandes et petites, ont, au fil des années, procédé à des majorations tarifaires.
LISTNUM 1 \l 16912 Il n'y a personne qui a dit que ces majorations‑là constituaient une forme d'option négative ou un lynchage des consommateurs et le constat est dans les chiffres que nous avons résumés dans notre présentation orale et qui sont tirés de votre propre base de données.
LISTNUM 1 \l 16913 Il est manifeste qu'il y a une augmentation progressive du produit des frais d'abonnements pour la base et pour les volets.
LISTNUM 1 \l 16914 LE PRÉSIDENT: Oui, mais il y a aussi et il y a manifeste parce que vous partez sur un horizon de 2001 à 2005 et aussi l'arrivée de nombreux nouveaux services de catégorie 1 et de catégorie 2 qui, évidemment, ont fait augmenter de manière importante les redevances versées aux exploitants de canaux spécialisés.
LISTNUM 1 \l 16915 M. MAYRAND: Bien, je pense, monsieur Arpin, que c'est précisément la source de la problématique à laquelle nous faisons face aujourd'hui, il n'y a pas de doute, mais...
LISTNUM 1 \l 16916 LE PRÉSIDENT: Mais ces services‑là sont quand même offerts en bouquets à des abonnés qui choisissent volontairement d'y souscrire.
LISTNUM 1 \l 16917 M. MAYRAND: Mais revenons à la base, et dans le cas du service de base, je ne pense pas que ce facteur‑là a joué dans le prix du volet de base.
LISTNUM 1 \l 16918 Il y a, évidemment, une distribution de services dits spécialisés encore au volet de base, et c'est certainement le cas chez COGEGO, mais dans l'ensemble, c'est un volet qui comporte une majorité de services autres que spécialisés.
LISTNUM 1 \l 16919 LE PRÉSIDENT: Pour ce qui est des services francophones, ma connaissance antérieure me fait croire que les services francophones qui sont à la base chez COGEGO n'ont pas eu le bénéfice d'augmentation tarifaire pour soutenir leur développement.
LISTNUM 1 \l 16920 C'est le nombre d'abonnées, oui, qui leur a bénéficié, mais ce n'est pas l'augmentation du tarif parce que... Dans le cas des bouquets, ça peut être différents, mais dans le cas des services à la base, les décisions rendues par le Conseil avaient déterminé de maximums et ces maximums‑là sont en place depuis de nombreuses années, sinon même en certains cas, on commence à parler bientôt de décennie.
LISTNUM 1 \l 16921 M. MAYRAND: Monsieur Arpin, nous avons régulièrement un rendez‑vous avec nos fournisseurs d'émissions.
LISTNUM 1 \l 16922 LE PRÉSIDENT: Ceux qui sont sur bouquets.
LISTNUM 1 \l 16923 M. MAYRAND: Bien, qui sont sur bouquets et qui sont portés à la base également.
LISTNUM 1 \l 16924 LE PRÉSIDENT: Oui, parce que c'est souvent les mêmes personnes, là.
LISTNUM 1 \l 16925 M. MAYRAND: Voilà. Et ils ont eux‑mêmes des bouquets de services dont ils négocient les frais d'affiliation en bouquets.
LISTNUM 1 \l 16926 Alors, nous avons une négociation d'ensemble de en bout de piste, on peut facilement affirmer que les services en question, quelle que soit la distribution en partie à la base, en partie sur un volet facultatif ou carrément sur les volets facultatifs, ont connu une croissance de leurs frais d'affiliation au cours des années.
LISTNUM 1 \l 16927 LE PRÉSIDENT: Si je vous comprends bien ‑‑ et corrigez‑moi si j'ai ‑‑ Québecor Média propose que la redevance n'affecte pas le coût de l'abonnement, de manière générale, bouquets et services de base compris, pour l'abonné moyen, et que le tarif d'abonnement qui serait souscrit viendrait en majeure partie, sinon en tout, d'une refonte des tarifs d'abonnements versés à l'ensemble de ceux qui en perçoivent présentement.
LISTNUM 1 \l 16928 Si je comprends bien, ce n'est pas la position de COGECO?
LISTNUM 1 \l 16929 M. MAYRAND: Vous avez tout à fait bien compris; ce n'est pas notre position.
LISTNUM 1 \l 16930 LE PRÉSIDENT: Ce n'est pas votre position, bon. Vous nous recommandez au Conseil d'entreprendre une étude complète et impartiale avant de formuler notre politique.
LISTNUM 1 \l 16931 Quels facteurs devrions‑nous prendre en compte dans une telle étude?
LISTNUM 1 \l 16932 M. MAYRAND: J'ai peur de ne pas pouvoir vous donner une réponse détaillée aujourd'hui parce que je ne suis pas... je ne prétends surtout pas être un expert de ce genre d'étude.
LISTNUM 1 \l 16933 Je pense que nous pourrions certainement, dans notre réponse écrite, vous donner ce que nous estimons être certains critères pertinents, mais à tout événement, il nous semble capital que le Conseil soit l'organisme qui entreprenne ou prenne l'initiative de cette étude.
LISTNUM 1 \l 16934 Pourquoi? Parce qu'autrement nous aurons une prolifération d'études avec des questionnaires dont les questions et la méthodologie varient dans un cas comme dans l'autre et il sera extrêmement difficile, voire impossible, d'en tirer des conclusions pratiques et utiles pour déterminer ce que vous aurez à déterminer.
LISTNUM 1 \l 16935 Alors, il nous semble préférable que ce soit le Conseil qui prenne l'initiative, traite avec les spécialistes appropriés, s'il y a lieu, et établissent avec eux sur la base de leur expertise les paramètres appropriés.
LISTNUM 1 \l 16936 LE PRÉSIDENT: Écoutez, si vous pouvez contribuer à nous aider, c'est sûr qu'on acceptera vos commentaires et ils seront certainement bienvenus.
LISTNUM 1 \l 16937 Votre société affiliée nous a dit que la redevance... dans sa perspective, la redevance ne devrait s'appliquer qu'aux entreprises de télévision généralistes commerciales privées. Avez‑vous une position quant aux entreprises publiques?
LISTNUM 1 \l 16938 M. MAYRAND: Quant aux entreprises publiques, nous n'avons pas pris de position pour l'instant, comme je vous l'indiquais dans mes remarques en début de comparution, et il nous semble qu'il y a là un problème de définition des mandats des chaînes du secteur public, que ce soit les chaînes qui relèvent du gouvernement fédéral pour leur financement ou celles qui relèvent du gouvernement provincial pour le financement.
LISTNUM 1 \l 16939 Il y a une préoccupation réelle qu'on ait de la confusion et des difficultés d'application inutiles s'il n'y a pas une conception claire du mandat à venir de ces chaînes‑là et de ce qu'elles ont l'intention de faire avec un influx additionnel de produits d'abonnements.
LISTNUM 1 \l 16940 Alors, nous avons réservé notre position. Il nous semble que ce serait regrettable et dommageable pour le secteur privé de la télévision conventionnelle au Québec d'attendre nécessairement que cette question‑là soit réglée. Elle est en voie de discussion dans le cas de CBC Radio‑Canada.
LISTNUM 1 \l 16941 Dans le cas de Télé‑Québec, ce n'est pas clair encore, mais ce serait regrettable d'attendre que ces mandats‑là soient éclaircis pour les années à venir dans le nouvel environnement audiovisuel numérique et de ne rien faire en attendant, pour s'assurer que le secteur privé de la télévision conventionnelle est capable de remplir les obligations que vous allez lui demander à ce secteur de remplir lors de leurs renouvellements de licence qui s'en viennent très prochainement.
LISTNUM 1 \l 16942 LE PRÉSIDENT: Demain, nous entendrons les représentations de la Fédération des télévisions communautaires autonomes du Québec et un volet de leur mémoire traite de la diffusion hertzienne et de l'intention de certains de leurs membres de soumettre des projets au Conseil en vertu de la politique sur la télévision communautaire qui leur permettrait d'avoir... de détenir des licences de diffusion hertziennes.
LISTNUM 1 \l 16943 Est‑ce qu'un tarif d'abonnement pour... devrait s'appliquer à eux? Je suis sûr que ça va faire partie de leur demande.
LISTNUM 1 \l 16944 Si le Conseil dit, oui, au principe, la suite va suivre.
LISTNUM 1 \l 16945 M. MAYRAND: Mais là aussi on a, je pense, un problème de définition de mandat. La politique du Conseil a été clairement établie il y a quelque temps sur la possibilité pour les télévisions communautaires d'émettre en rayonnement hertzien.
LISTNUM 1 \l 16946 Ceci étant, il y a relativement peu de développement sur ce plan‑là jusqu'à présent, mais il y a une chose qui est sûre, c'est que le Conseil a fixé des paramètres assez clairs sur le mandat de la télévision communautaire.
LISTNUM 1 \l 16947 Alors, je ne pense pas que les télévisions communautaires sont intéressées à avoir le même genre de contenu obligationnel que les télévisions conventionnelles et, à cet égard aussi, les télévisions spécialisées acceptent de prendre à leur charge par condition de licence.
LISTNUM 1 \l 16948 Alors, je ne peux que répondre qu'il y a un problème de définition de mandat, et qu'on ne peut pas avoir le beurre et l'argent du beurre.
LISTNUM 1 \l 16949 En fait, vous savez, toute cette discussion sur les frais d'abonnement pour les services conventionnels, à notre point de vue, elle s'inscrit clairement dans la dynamique de renouvellement, à venir très prochainement, des licences des services de télévision conventionnelle et de ce qui devrait constituer une enveloppe raisonnable d'obligations de ce secteur‑là du système au regard de la programmation canadienne, du financement de la programmation canadienne, de sa mise en ondes et de l'encouragement aux talents.
LISTNUM 1 \l 16950 Alors, on peut très bien envisager un scénario qui, à notre point de vue, est extrêmement dommageable et regrettable pour tout le marché francophone, où il y a une inflexibilité totale sur l'accès aux frais d'abonnement pour les conventionnels et où tous les services conventionnels vont venir vous dire, bien, si c'est comme ça, nous, on n'arrive pas, puis les obligations qu'on est prêt à accepter sont radicalement différentes de celles qui prévalaient pour le renouvellement précédent.
LISTNUM 1 \l 16951 Alors, on ne peut pas avoir les deux. On ne peut pas maintenir un régime obligationnel important et coûteux, puis en même temps dire, bien, du côté des ressources, continuez à prendre le risque, puis continuez à voir vos marges diminuées, puis en plus investissez dans l'infrastructure de diffusion HD pour être sûr que le 10 pour cent, ou peut‑être à terme le 5 pour cent, restant de foyers puissent avoir toujours accès à vos services gratuitement. Monsieur Arpin, ça n'arrivera pas.
LISTNUM 1 \l 16952 LE PRÉSIDENT : Vous m'amenez sur... en fait, en ce qui regarde les télévisions communautaires, je pose la question parce que c'est eux qui la soulève, mais je suis bien d'accord avec vous que l'appel de commentaires pour la revue de la télévision s'appliquait essentiellement à la télévision généraliste hertzienne et, au moment où l'avis a été publié, celle qui était au moins titulaire d'une licence.
LISTNUM 1 \l 16953 Les autres dont j'ai fait état, c'est des projets qu'ils nous soumettent, et ils auront à débattre de leurs projets si jamais ils en soumettent, et le Conseil, évidemment, va prendre sa décision.
LISTNUM 1 \l 16954 Vous venez juste d'aborder la question de la transmission en numérique HD par les différents télédiffuseurs. On a entendu au cours des quatre derniers jours qu'il y avait au moins deux modèles, un modèle hybride et un modèle qui était uniquement remis au système canadien de distribution. Je sais que TQS suggère au Conseil de suivre cette voie‑là, donc, de ne pas les forcer à passer à la transition numérique, et voire même à la transmission numérique HD.
LISTNUM 1 \l 16955 Dans la perspective de Cogeco, le fait qu'il n'y aurait plus de transmission hertzienne, quelle est la signification pour Cogeco, quel est l'impact pour Cogeco d'une politique semblable?
LISTNUM 1 \l 16956 M. MAYRAND : Je ne sais pas si ça constitue en soi un impact dramatique pour Cogeco dans son ensemble. Je pense que le principal impact est dans le fond la raison pour laquelle notre filiale TQS vous a dit, écoutez, dans le marché francophone en tout cas, on devrait éviter de prendre des ressources énormes par rapport aux disponibilités financières du secteur pour assurer un mode de diffusion en direct en télévision HD.
LISTNUM 1 \l 16957 Ce que notre filiale vous a dit, c'est, écoutez, c'est hautement inefficace, et moi, j'ajouterais à ça que, depuis 1975 que je m'intéresse aux questions de radiodiffusion, on a toujours, à une occasion ou l'autre, mentionné le fait qu'il est important dans notre système de radiodiffusion de se préoccuper au premier chef du contenu, puis d'éviter de passer une trop grande proportion des ressources à la mécanique et aux équipements.
LISTNUM 1 \l 16958 Alors, dans un marché aussi petit -‑ parce que c'est un petit marché, c'est un marché potentiel d'au plus 6 millions d'âmes ‑‑ c'est une équation qui, clairement, à ce moment‑ci ne fonctionne pas. Ça suppose que Cogeco et son partenaire dans TQS seraient prêts à investir des sommes en capital énormes pour assurer une diffusion hertzienne en HD que très, très peu de gens, en définitive, utiliseront.
LISTNUM 1 \l 16959 Alors, nous appuyons la position de TQS à cet égard‑là. Certainement dans le cas du marché francophone, il nous semble que la solution devrait être comme le propose notre filiale.
LISTNUM 1 \l 16960 La conclusion peut être un peu différente au Canada anglais, qui est un beaucoup plus gros marché dans son ensemble et dont les composantes locales sont beaucoup plus grosses et prospères que ce que nous avons au Québec, et si c'est le cas, là encore, on parle de formule hybride. C'est donc dire qu'on ne parle pas d'une conversion complète et totale. Il y a toujours une portion du résultat requis qui passe par les entreprises de distribution.
LISTNUM 1 \l 16961 LE PRÉSIDENT : En fait, les principaux distributeurs qu'on a entendus jusqu'à aujourd'hui nous disent que les dépenses d'immobilisations qui concernent le passage au numérique HD sont... c'est minime et c'est le coût pour être en affaires.
LISTNUM 1 \l 16962 Vous ne semblez pas partager... en tout cas, dans le cas du marché francophone, vous ne semblez pas partager cette vision, malgré le fait que je suis persuadé que Cogeco, comme entreprise de distribution, fait des investissements dans ces réseaux qui sont beaucoup plus significatifs que les sommes dont on parle pour passer au numérique HD pour l'hertzien.
LISTNUM 1 \l 16963 M. MAYRAND : Bien, à cet égard, deux choses, Monsieur Arpin.
LISTNUM 1 \l 16964 D'abord, Cogeco, effectivement, consent des investissements considérables en immobilisations pour moderniser ses réseaux et pour leur permettre d'accommoder une pluralité de services, mais Cogeco Câble a toujours dit, et je me dois de le répéter aujourd'hui, Cogeco Câble ne peut le faire que dans la mesure où elle a les flux monétaires résultant de ses activités qui lui permettent de le faire.
LISTNUM 1 \l 16965 Le problème dans le cas de notre filiale TQS, c'est que... vous connaissez l'environnement actuel du marché francophone, vous connaissez le potentiel de l'assiette publicitaire pour le secteur francophone de télévision, vous connaissez les gains spectaculaires d'auditoires et de parts de marché publicitaire des services spécialisés francophones et des services anglophones au Québec.
LISTNUM 1 \l 16966 Alors, dans ce contexte, je pense qu'on doit reconnaître que les flux monétaires que nous pouvons attendre au cours des prochains cinq à sept ans ne sont tout simplement pas au rendez‑vous pour permettre à TQS de faire cette transition rapidement et sans créer un problème insurmontable pour son entreprise et ses actionnaires.
LISTNUM 1 \l 16967 LE PRÉSIDENT : Dans votre mémoire, d'ailleurs, vous y faites un petit peu allusion, mais surtout les autres intervenants ont assez longuement parlé de sources de revenus nouvelles pour les diffuseurs hertziens, et qui seraient basées sur l'offre du vidéo sur demande, et où la politique actuelle du Conseil peut‑être autorise la diffusion des émissions ayant déjà été diffusées en maintenant les messages commerciaux originaux, mais il y a au toute sorte d'options qui ont fait l'objet de considération.
LISTNUM 1 \l 16968 Est‑ce que l'expérience de Cogeco au Québec avec la vidéo sur demande, est‑ce que c'est une avenue qui permet à TQS et à TVA d'explorer de nouvelles opportunités d'affaires, et qui serait suffisante, du moins pendant un certain temps?
LISTNUM 1 \l 16969 M. MAYRAND : Alors, oui, il y a de nouvelles opportunités d'affaires. Oui, nous en avons fait l'expérience sur la plate‑forme VSD de Cogeco Câble, tant au Québec qu'en Ontario.
LISTNUM 1 \l 16970 Toutefois, les expériences demeurent relativement limitées jusqu'à présent à quelques produits, et ce que nous rencontrons, ce sont, entre autres choses, des obstacles au niveau des droits. Et quand je dis nous les rencontrons, au premier chef, ce sont les diffuseurs qui les rencontrent avant d'avoir la possibilité d'exploiter la plate‑forme VSD.
LISTNUM 1 \l 16971 Alors, ça, c'est le premier facteur. Il s'agit, donc, d'un phénomène émergent où les rapports économiques avec les différents ayants‑droit sont encore largement en suspens.
LISTNUM 1 \l 16972 Alors, c'est très difficile d'attendre un développement rapide de ce développement dans les circonstances, jusqu'à ce que la question des droits s'éclaircisse et qu'on ait plus de facilité à établir des modèles d'affaires.
LISTNUM 1 \l 16973 La deuxième remarque que je voudrais faire sur la plate‑forme VSD, c'est que, déjà, la plate‑forme VSD sur le câble est sous attaque par la distribution directe via internet. Alors, il faut faire très attention de ne pas avoir une expectative irréaliste ou démesurée sur le potentiel à terme de la plate‑forme VSD de constituer un atout significatif au plan des produits générés pour les producteurs et diffuseurs de nos contenus dans le marché francophone.
LISTNUM 1 \l 16974 Il reste beaucoup d'inconnus et beaucoup de défis pour en arriver là. En attendant, il y a un problème assez criant, que vous constatez aujourd'hui, mais que vous allez constater encore plus dans le détail lorsque les titulaires devront se présenter en renouvellement de licence, parce que les revenus sont en déclin.
LISTNUM 1 \l 16975 LE PRÉSIDENT : On a entendu lors de cette audience les représentations des petits télédiffuseurs, et il y en a au moins un qui est dans des territoires que Cogeco dessert. Je pense à Télé Inter Rives, et je pense particulièrement du côté de Rimouski‑Matane puisque même si la station de base est à Rivière‑du‑Loup, c'est dans les territoires de la Gaspésie ou du Bas‑Saint‑Laurent, où votre réseau...
LISTNUM 1 \l 16976 Une des considérations... et je ne dis pas que c'est monsieur Simard qui l'a soulevée, parce qu'elle a été soulevée par l'ensemble des membres du groupe, et de mémoire, je ne me souviens pas que monsieur Simard ait commenté spécifiquement sur le phénomène, mais on a parlé... et là, malheureusement, à l'esprit, j'ai seulement les termes anglophones qui me viennent à l'esprit.
LISTNUM 1 \l 16977 On a parlé de time shifting et de station shifting. Je ne pense pas qu'il y ait un problème au Québec de time shifting parce que tous les raisons francophones sont dans le même fuseau horaire.
LISTNUM 1 \l 16978 Mais, est‑ce que dans vos territoires du Bas Saint‑Laurent, est‑ce qu'il y a une situation où, finalement, vous offrez à la fois à la station de Québec ou de Montréal et puis la station de Rivière‑du‑Loup et de Rimouski pour l'un ou l'autre des réseaux et donc, potentiellement, les abonnés peuvent syntoniser un ou l'autre
LISTNUM 1 \l 16979 M. MAYRAND: Écoutez; je devrais me souvenir de la situation précise à Rimouski. Honnêtement, j'oublie quelle est notre grille de distribution précise dans ce marché‑là, mais sans doute qu'il y a des situations de présence d'un signal de réseau et de la station locale affiliée au réseau. Il est impossible d'avoir une absence totale de recoupement.
LISTNUM 1 \l 16980 Ma compréhension des choses, c'est que nous traitons de ces questions‑là avec les affiliés, nos affiliés, dans le cadre des contrats d'affiliation et que ces facteurs‑là sont pris en ligne de compte.
LISTNUM 1 \l 16981 Et, d'ailleurs, vous pourrez sans doute noter qu'il y a eu un arrangement entre la télévision MBS et TQS qui fait en sorte que la position de MBS se trouve à être consolidée dans le Bas Saint‑Laurent.
LISTNUM 1 \l 16982 Nous avions une ré‑émettrice et la proposition vous est faite d'autoriser son transfert à MBS.
LISTNUM 1 \l 16983 LE PRÉSIDENT: Je ne veux pas parler de ce dossier‑là puisque la date butoir pour le dépôt d'intervention, c'est demain et, donc, je ne suis pas en train de faire l'audience. Mais je comprends ce que vous venez de me dire.
LISTNUM 1 \l 16984 Mais par rapport aux stations qui sont, elles, membres de TVA, est‑ce que le même problème se soulève? Je sais qu'il y en a une à Carleton, il y en a une à Rimouski, je suis persuadé?
LISTNUM 1 \l 16985 M. MAYRAND: Bien, je ne pense pas que ce soit...
LISTNUM 1 \l 16986 LE PRÉSIDENT: Il y en a une à Québec, ça, je suis sûr.
LISTNUM 1 \l 16987 M. MAYRAND: Ça, c'est sûr. Je ne pense pas que je sois en mesure de commenter sur les problématiques spécifiques à TVA.
LISTNUM 1 \l 16988 LE PRÉSIDENT: Non, non, mais en fait, c'est que le diffuseur local ‑‑ prenons Rimouski ‑‑ nous dit que parce que le téléspectateur a accès à deux, trois sources de la même... du même réseau, il perd des opportunités avec sa diffusion de messages de publicité locale parce que le citoyen de Rimouski, au lieu de syntoniser la station de Rimouski, syntonise celle de Québec.
LISTNUM 1 \l 16989 Donc, lui, à Rimouski, il se trouve avec une situation d'inefficacité et c'est une des raisons qui nous... sur laquelle il nous demande d'apporter des mesures qui feraient en sorte que... où on proposerait des nouveaux mécanismes compensatoires ou qu'on créerait un forum de négociations des stations éloignées.
LISTNUM 1 \l 16990 M. MAYRAND: Bien, tout ce que je peux dire à ce stade‑ci, c'est qu'on ne peut pas s'attendre à avoir un monde absolument idéal et parfait. Je pense qu'on essaie avec... alors que se profile à l'horizon le renouvellement de licences des réseaux qui sont, finalement, les sources principales de programmation dans le marché francophone en tout cas, qui soutiennent et sous‑tendent les services locaux, on ne peut pas imaginer avoir des solutions absolument parfaites partout, en tout temps.
LISTNUM 1 \l 16991 Ceci étant dit, quand il y a un problème réel, je pense que l'attitude de notre groupe de compagnies a toujours été de s'en préoccuper et de tenter de le régler de façon intelligente dans la négociation.
LISTNUM 1 \l 16992 Alors, maintenant, ceci étant dit, dans l'environnement où la diffusion HD pour le marché francophone se ferait sur une base où les rayonnements hertziens ne sont pas étendus à ces marchés‑là, vous avez déjà une dynamique différente et peut‑être que le problème, s'il en est, devient beaucoup moins pertinent.
LISTNUM 1 \l 16993 LE PRÉSIDENT: On a fait état à plusieurs reprises d'une date butoir pour le passage au numérique. Avez‑vous une position sur cette question?
LISTNUM 1 \l 16994 M. MAYRAND: Tout ce que je pourrais vous dire, monsieur Arpin, c'est que c'est une question difficile. Pourquoi? Parce qu'à l'expérience, lorsqu'on établit dans le cas d'un changement technologique majeur, une date butoir, il y a toujours le risque que les réalités économiques ne fonctionnent pas exactement comme on le prévoit et les dates butoir ont tendance à être modifiées par la suite.
LISTNUM 1 \l 16995 Ceci étant dit, y a‑t‑il un avantage au plan de la signalisation à dire à l'industrie, écoutez, l'objectif, c'est que la transition soit faite mettons en 2011, mettons en 2012 ou quelle que soit une date indicative que le Conseil estime approprié, peut‑être qu'il y a avantage à signaler de cette façon‑là.
LISTNUM 1 \l 16996 Mais en pratique il se pourrait fort bien que la date pose problème au moment où on s'achemine vers l'échéance et je le dis particulièrement dans le contexte du marché francophone, où les services analogiques sont encore très présents et où les consommateurs ont une propension, du moins dans un segment significatif de la population à s'en tenir aux services analogiques.
LISTNUM 1 \l 16997 Alors, probablement au plan de la signalisation il y a intérêt à avancer une date, mais il ne faudrait pas se surprendre que les réalités économiques fassent en sorte que la date soit... doive être réaménagée par la suite.
LISTNUM 1 \l 16998 LE PRÉSIDENT: Avant de revenir un peu sur la redevance de distribution, est‑ce que votre position par rapport au Canada anglais est analogue à celle des autres distributeurs qu'on a entendus ou si elle est distincte?
LISTNUM 1 \l 16999 M. MAYRAND: Non; elle est... elle est distincte, monsieur Arpin, pour les raisons qu'on vous donne dans notre mémoire et notre présentation sur le plan du principe. Et ce serait honnêtement pas correct pour nous de prendre une position de principe qui ne vise que le marché francophone parce que nous nous adonnons à avoir une filiale de télédiffusion dans le marché francophone.
LISTNUM 1 \l 17000 Et à cet égard, je tiens à préciser pour le dossier et j'espère que le Conseil comprend, que la position de principe que nous avons prise n'est pas une position qui est articulée strictement en fonction des intérêts économiques et du moindre risque pour COGECO dans son ensemble.
LISTNUM 1 \l 17001 Je tiens à le préciser parce que je suis un peu choqué d'apprendre que dans certains milieux on nous reproche d'avoir agi d'une façon qui est, pour utiliser l'expression, self‑serving.
LISTNUM 1 \l 17002 Nous avons pris une position qui comporte... qui comporte certains risques et des difficultés d'application et sûrement des ajustements qui, en tant que tels, ne sont pas des choses qu'on serait portés à souhaiter au préalable.
LISTNUM 1 \l 17003 Il nous semble, cependant que c'est la chose à faire et c'est pourquoi nous avons avancé la position que nous avons avancée sur les frais d'abonnement parce que l'évolution du système de radiodiffusion le justifie et qu'il y a lieu de trouver un nouveau point d'équilibre. Voilà.
LISTNUM 1 \l 17004 LE PRÉSIDENT: Et ma dernière question, certains distributeurs, notamment Bell, Telco, nous ont dit que les principes de la Loi sur le droit d'auteur nous empêchaient d'introduire une redevance d'abonnement.
LISTNUM 1 \l 17005 Avez‑vous des commentaires à ajouter à cette... je présume, qui ne seront pas ceux qu'on entend, qui semblent plutôt similaires à ceux que TQS nous a présentés, mais je voudrais quand même vous entendre.
LISTNUM 1 \l 17006 M. MAYRAND: Bien, effectivement, TQS a participé à l'élaboration d'une opinion par un grand bureau, un grand cabinet juridique canadien qui est au dossier, je pense que l'opinion parle d'elle‑même, elle est limpide, elle est claire, elle est bien circonstanciée, et elle reprend des thèmes qui ont déjà été discutés dans les opinions antérieures il y plus de dix ans.
LISTNUM 1 \l 17007 Et franchement, nous sommes confortables non seulement avec cette opinion, mais de plus, il est pour le moins étonnant de soulever la... comment je dirais, le paravent du droit d'auteur dans les circonstances parce que, comme vous le mentionniez un petit peu plus tôt, justement lors de la présentation de nos prédécesseurs, il y a deux lois fédérales qui ont des objectifs différents et il n'est pas du tout incorrect ou inconcevable que des actions soient prises sous l'autorité de l'un ou de l'autre et dans ce cas‑ci...
LISTNUM 1 \l 17008 LE PRÉSIDENT: Et ou voir des deux?
LISTNUM 1 \l 17009 M. MAYRAND: Et possiblement des deux, mais dans ce cas‑ci, on parle clairement d'une situation où le Conseil, selon nous, a parfaitement autorité pour agir et je trouve que la distinction qui est faite au plan de la compétence et de l'autorité d'agir du Conseil aux termes de la Loi sur la radiodiffusion, selon qu'il s'agit d'un service spécialisé qui n'a pas d'antenne de rayonnement et d'un service dit conventionnel qui s'adonne à avoir une ou des antennes de rayonnement dans l'état actuel des choses ‑‑ ça ne veut pas dire que ça serait toujours comme ça ‑‑ je trouve cet argument‑là un peu spécial.
LISTNUM 1 \l 17010 LE PRÉSIDENT: Ça termine mes questions, mais mon collègue, monsieur Williams, en aurait une pour vous.
LISTNUM 1 \l 17011 COMMISSIONER WILLIAMS: Mr. Mayrand, the distributors in the English market place and earlier today, the national DTH Distributors are adamant that no fee for service is justifiable under any circumstance. Yet, the distributors from Quebec do not have the same position.
LISTNUM 1 \l 17012 Given that your company works in both Quebec and Ontario, I would be very interested in your opinion.
LISTNUM 1 \l 17013 Do you think the CRTC should consider the French and English markets as being very different, to such a degree that they may require a different solution for each, particularly when considering the question of a fee for service?
LISTNUM 1 \l 17014 MR. MAYRAND: Thank you, Mr. Williams. Well, as I indicated earlier, I think there is a recognition not only in the Act, but broadly speaking by players in the industry that the francophone market is a specific market, that it is very difficult in a number of situations to adopt standard rule as between the anglophone and the francophone market.
LISTNUM 1 \l 17015 That being said, I also indicated a little earlier, in answer to other questions that the position that COGECO has taken on the principle of extending fee for carriage to conventional broadcasting, be it on a progressive and orderly and well‑thought out manner is not specific to Quebec.
LISTNUM 1 \l 17016 That being said, the Commission has full authority, obviously, to determine whether the principle should be recognized in the francophone market exclusively or more broadly in Canada and the terms that should apply to that decision.
LISTNUM 1 \l 17017 COMMISSIONER WILLIAMS: Thank you, Mr. Mayrand and thank you, Mr. Chairman.
LISTNUM 1 \l 17018 LE PRÉSIDENT: Maître Dignard, monsieur Simon, maître Mayrand, merci pour votre contribution.
LISTNUM 1 \l 17019 Nous prendrons une heure pour le lunch. En fait, peut‑être jusqu'à 2 h 15 pour permettre aux prochains intervenants de venir prendre place.
LISTNUM 1 \l 17020 So, we will recess until 2:15.
‑‑‑ Upon recessing at 1305 / Suspension à 1305
‑‑‑ Upon resuming at 1429 / Reprise à 1429
LISTNUM 1 \l 17021 THE CHAIRPERSON: We apologize for being late. We will give an extra 15 minutes. Thank you for being here at the proper time, because I walked in I noticed that everybody was seated and waiting respectfully. I appreciate that very much and really apologize for the lateness.
LISTNUM 1 \l 17022 Madam Secretary...
LISTNUM 1 \l 17023 LA SECRÉTAIRE: Merci, Monsieur le président.
LISTNUM 1 \l 17024 We will now proceed with the next presentation, the British Columbia Institute of Technology. Mr. Brian Antonson will introduce his panel and you will then have 10 minutes for your presentation.
LISTNUM 1 \l 17025 Mr. Antonson...?
PRESENTATION / PRÉSENTATION
LISTNUM 1 \l 17026 MR. ANTONSON: Thank you.
LISTNUM 1 \l 17027 Good afternoon. Some of you have met us before in May at the radio hearings, others have not so I will introduce the team.
LISTNUM 1 \l 17028 I am Brian Antonson, the Associate Dean of Broadcast and Media Communications at BCIT, the British Columbia Institute of Technology in Vancouver.
LISTNUM 1 \l 17029 Next to me is Laura Davie, who is the Associate Dean of Digital Arts at BCIT.
LISTNUM 1 \l 17030 Michele McManus is Coordinator of the Broadcast Production Program in the Media Arts Department at Confederation College in Thunder Bay. She is also Secretary to the Broadcast Educators Association of Canada, which is an association that represents provincially administered post‑secondary institutions that train, among other things, in radio, television, broadcast journalism, film, new media and animation.
LISTNUM 1 \l 17031 At the far end is John Hylton, an Adjunct Professor at Osgoode Hall, former Chair of the Radio and Television Department at Ryerson University. John provides fairly good counsel to the Broadcast Educators Association. If he leaves it is because he has to catch and airplane and not because he doesn't like you people, all right.
LISTNUM 1 \l 17032 My colleagues and I are pleased to be here today to present our case for change in television policy, something that we believe could be of tremendous value to both our training programs and to our industry. We made a similar presentation, as a couple of you will know, at the radio review hearings in May and we await the final decision in that case.
LISTNUM 1 \l 17033 We represent almost two dozen training programs across Canada that provide broadcast and new media training to perhaps 4,000 students at any one time, and approximately 2,000 of those will graduate and move into employment in the industries we serve in any given year.
LISTNUM 1 \l 17034 To begin I will turn things over to BCIT's Laura Davie who will explain how we have come to be here at this time.
LISTNUM 1 \l 17035 MS DAVIE: Excuse my voice. Thank you.
LISTNUM 1 \l 17036 The worlds of broadcast and new media education face some daunting challenges and securing the ongoing funding to ensure a program's training on current technology and equipment is a prime concern of ours.
LISTNUM 1 \l 17037 In the late 1990s Brian Antonson and I identified what we believed would be opportunities for donations that could support capital projects in our facilities under the CRTC's tangible benefits clause policy. These opportunities required some expansion or change in policy to be really effective.
LISTNUM 1 \l 17038 In 1999 we made the first of the series of trips to meet with the senior CRTC staff to discuss our concepts. Everyone suggested that the appropriate time for presenting our case for changes in policy would be at the next radio review and the next television review, both of which were some years away. That time of course is now.
LISTNUM 1 \l 17039 In the meantime, we were encouraged to find a partner and bring our concepts forward on a test basis.
LISTNUM 1 \l 17040 Our first partner was BCE. When BCE purchased CTV we made a presentation that caught their attention, resulting in a donation of $1.5 million to BCIT that allowed us to create our BCE New Media Centre of Excellence containing high tech new media and animation classrooms and computer labs. Today this centre trains almost 200 full‑time students each year, along with another 1,000 part‑time students.
LISTNUM 1 \l 17041 Our second partner was Global. When they purchased BCTV in Vancouver, we presented them with a compelling concept that resulted in their donation of $300,000 that allowed us to create our Global Television News Centre of Excellence. That contains a fully equipped television newsroom and production studio, which today trains some 160 students every year.
LISTNUM 1 \l 17042 We have brought along a poster for your viewing pleasure and some photosheets to show you the extremely positive capital project results that have come from these tangible benefits proposals being approved.
LISTNUM 1 \l 17043 Similar positive results have occurred sporadically across Canada. In the BCE decision the radio and television arts training program at Ryerson University also received a $2.5 million allocation to establish the BCE Chair in Convergence.
LISTNUM 1 \l 17044 A few years ago the broadcast program at Fanshaw College received $1.2 million to establish a leading edge music recording facility in the decision to grant CHUM Limited a local licence.
LISTNUM 1 \l 17045 But these benefits have touched only a very small number of the two dozen or so broadcast training program in Canada and the challenges remain and will continue to be huge.
LISTNUM 1 \l 17046 In all programs right across the country, provincially funded institutions face constant financial challenges and with the emerging necessary move to training in high definition, the future prospects for our programs are truly daunting.
LISTNUM 1 \l 17047 But we have hope that our suggested changes to radio and television policy might help us in addressing these challenges. Brian will speak to our proposals.
LISTNUM 1 \l 17048 MR. ANTONSON: She deserves some kind of medal for struggling through this cold.
LISTNUM 1 \l 17049 Okay, here is our case for change.
LISTNUM 1 \l 17050 As Laura described, tangible benefits allocations have worked very well for us at BCIT and in some other programs across the country, but for the most part these have been approved without the benefit of specific wording in policy and affected only a small number of existing programs.
LISTNUM 1 \l 17051 Policy currently speaks to tangible benefits at the time of transfers of ownership for only scholarships. We propose a change in the wording found in Public Notice CRTC 1993‑68 entitled "The application of benefits tests at the time of transfers of ownership" in the appendix under "Initiatives generally accepted as tangible benefits" and in section (c) "Grants and contributions".
LISTNUM 1 \l 17052 Now, the specific wording in question currently reads:
"Scholarships in broadcasting or broadcast‑related fields also constitute tangible benefits." (As read)
LISTNUM 1 \l 17053 We request that this wording be changed to read:
"Scholarships and capital grants to provincially administered post‑secondary educational institutions training in broadcasting and broadcast‑related fields also constitute tangible benefits." (As read)
LISTNUM 1 \l 17054 The important proposed change here is to allow capital grants to qualify, thus allowing broadcasters to help create new facilities and introduce current technology and equipment to the schools that provide our industry's future employees.
LISTNUM 1 \l 17055 For your information, we also suggested in the radio review that the policy on Canadian Talent Development be revisited. Some of this applies to television of course. Currently it states:
"Scholarships will qualify as Canadian Talent Development expenditures only when they support students engaged in music, journalism or other artistic studies, and grants to those organizations offering courses in broadcasting or devoted to the continuing education of radio staff will not qualify." (As read)
LISTNUM 1 \l 17056 We believe that we develop Canadian talent every day in all of our training programs right across the province or right across Canada. We train the people who will entertain and inform Canadians on radio and television for years to come. We train the people who will report Canadian news, who will play Canadian music, who will create Canadian music videos and commercial campaigns and drama and variety programming and who will use computer technology to produce stimulating animation and web images that will be seen and used by Canadians every single day of their lives for the long term.
LISTNUM 1 \l 17057 So we have proposed changes to that policy so that it reads:
"Scholarships will qualify as Canadian Talent Development expenditures only when they support students engaged in music, radio, television, broadcast journalism, print journalism, film, new media, animation and other artistic studies. Capital grants to provincially administered post‑secondary institutions offering training in broadcasting and related industries also will qualify." (As read)
LISTNUM 1 \l 17058 The immediate effect of these changes being made will be that broadcasters will have the opportunity to at least consider allocating some of their commitments to local or regional broadcasting schools.
LISTNUM 1 \l 17059 A number of our broadcast industry colleagues have asked if they could provide this kind of support to us in recent years, and while meeting Commission expectations under these policies, something that has encouraged us to move forward all of our concepts and proposals.
LISTNUM 1 \l 17060 Right now the restrictions to those allocations to scholarships benefit only the very few very top students in our programs. By making these changes, the Commission and the industry will see those benefits have the potential for extending to the entire student body in a program, and in some cases that is hundreds of students. Certainly at BCIT hundreds of students a year would be affected by that sort of thing.
LISTNUM 1 \l 17061 Certainly we expect broadcast operations will continue to provide support for our top students in the form of scholarships, but we also anticipate that we will embrace the concept of making commitments that benefit the many and not just the few. Our proposed changes, if accepted, will benefit our students, ultimately our donors who will employ them, and over overall industry and ultimately of course the listening and viewing audiences of Canada.
LISTNUM 1 \l 17062 We were asked in the radio review hearing if we could provide some information on the potential impact of our proposals, with the understanding that this was addressing the question of financial impact on the industry and on the broadcast education community. We want to discuss that just for a moment.
LISTNUM 1 \l 17063 This is extremely difficult to determine as we are requesting that broadcasters be given the option in policy of allocating capital grants to the broadcast schools. Whether they actually would is a matter of conjecture.
LISTNUM 1 \l 17064 But if our request for policy change is proved, and if transactions continue to take place, and if broadcasters choose to allocate some of their tangible benefits to support capital projects in our schools, and if past practice is any guide, then millions of tangible benefits dollars could be allocated in the form of capital grants over the next many years.
LISTNUM 1 \l 17065 That is something that would have an extremely positive impact on cash‑strapped broadcast training programs across the country and ultimately, as we have noted, on viewing and listening audiences in Canada.
LISTNUM 1 \l 17066 I have some final wrap‑up words from Michele.
LISTNUM 1 \l 17067 MS McMANUS: Thank you, Brian.
LISTNUM 1 \l 17068 A quick review now of our proposals.
LISTNUM 1 \l 17069 We ask that the tangible benefits policy be expanded to include capital grants as well as scholarships as acceptable allocations to broadcast training programs.
LISTNUM 1 \l 17070 We have asked in the radio review that the Canadian Talent Development policy recognize that broadcast training programs do develop Canadian talent and their students, and that the Canadian Talent Development policy be expanded to include capital grants as well as scholarships as acceptable allocations to broadcast training programs.
LISTNUM 1 \l 17071 We believe our submission presents a compelling case for change in policy. We believe the long‑term benefits to so many individual partners and the industry as a whole speaks volumes toward a positive decision from the Commission.
LISTNUM 1 \l 17072 We thank you for your time today and look forward to a supportive decision from you in due course.
LISTNUM 1 \l 17073 We will be pleased to respond to any questions you may have at this time.
LISTNUM 1 \l 17074 Again, thank you.
LISTNUM 1 \l 17075 THE CHAIRPERSON: Thank you very much.
LISTNUM 1 \l 17076 I am asking Commissioner Williams...?
LISTNUM 1 \l 17077 COMMISSIONER WILLIAMS: Good afternoon, Mr. Antonson and panel members. I have a few questions for your group.
LISTNUM 1 \l 17078 Why do you consider it the role of the broadcasting industry to be involved in provincially administered post‑secondary educational institutions?
LISTNUM 1 \l 17079 MR. ANTONSON: Rather than government?
LISTNUM 1 \l 17080 COMMISSIONER WILLIAMS: Yes. Rather than purely government, sure.
LISTNUM 1 \l 17081 MR. ANTONSON: Yes. Certainly our industries benefit from the people that we turn out on a yearly basis. BCIT, with which I am most familiar, turns out about 120 people into our market.
LISTNUM 1 \l 17082 We don't get the support that we need from the provincial government. No educational institute does. BCIT has a yearly capital allocation of about $4 million. Broadcast gets a big chunk of that, but last year or this current capital year, our chunk was $180,000. In a time when we are making moves to digital and all those different things that doesn't go very far and so we are seeking other sources of funding.
LISTNUM 1 \l 17083 We are not really looking for new money. People over the last few days have used the phrase coming here with their hands out. We are not in effect asking for new money, we are asking that money that is already being allocated could be allocated to us in the form of capital grants. We are not going to get it in the long term from provincial government sources, we seek those dollars from this source.
LISTNUM 1 \l 17084 Should they do that? I don't know. They have been very supportive over the years and in a couple of remarkable cases they have done very well by us and the Commission has seen fit to approve that and we are hoping that would continue.
LISTNUM 1 \l 17085 COMMISSIONER WILLIAMS: This facility here that you are describing with the poster.
LISTNUM 1 \l 17086 MR. ANTONSON: Yes.
LISTNUM 1 \l 17087 COMMISSIONER WILLIAMS: With this New Media Centre of Excellence, if I can just look to your notes here, you received $1.5 million.
LISTNUM 1 \l 17088 What does it cost to build a facility like that?
LISTNUM 1 \l 17089 MR. ANTONSON: The cost was in the area of $900,000 and a half a million of that was allocated to an endowment fund to keep money coming on a yearly basis to replace the computers, to upgrade things, and so on.
LISTNUM 1 \l 17090 That was a computer‑operated facility. Broadcast facilities are much more expensive of course because one camera ‑‑ well, as somebody mentioned earlier today, an HDTV camera can be had now for $50,000, a lot cheaper than it was at a quarter million dollars a few years ago.
LISTNUM 1 \l 17091 COMMISSIONER WILLIAMS: Does your school train with HD equipment?
LISTNUM 1 \l 17092 MR. ANTONSON: No. We don't have any.
LISTNUM 1 \l 17093 Laura has something she wanted to add to that.
LISTNUM 1 \l 17094 COMMISSIONER WILLIAMS: I'm sorry. Go ahead.
LISTNUM 1 \l 17095 MR. ANTONSON: With her bad voice.
LISTNUM 1 \l 17096 MS DAVIE: Sorry. If I could add, the new media centre of excellency is my pride and joy. At the time when we were given that $1.5 million, $500,000 was put into an endowment. We spent $900,000 of that money but BCIT kicked in at least $400,000 at the time.
LISTNUM 1 \l 17097 BCIT has continued to upgrade the computers every three or four years since that new facility took place.
LISTNUM 1 \l 17098 The other thing I would like to add is that BCIT, although we were given about $4 million in capital every year, we have approximately 120 computer labs. That means those labs seat between 24 and 30 students. And that is part of the capital allocation upgrade as well.
LISTNUM 1 \l 17099 So you can imagine in an institution our size and other institutions across the country, there is a real tug for that money.
LISTNUM 1 \l 17100 MR. ANTONSON: We are the largest educational institution in British Columbia, and we have 140 programs. So the two programs that Laura and I oversee are two of 140. So there is a lot of hands out for those capital dollars.
LISTNUM 1 \l 17101 COMMISSIONER WILLIAMS: What is the magnitude of the capital required for the type of training that you do at BCIT?
LISTNUM 1 \l 17102 MR. ANTONSON: We have a largely standard definition television facility, a largely ‑‑ we are moving in bits and pieces to digital in the radio area, which is much less expensive, much more affordable.
LISTNUM 1 \l 17103 The need to upgrade has been estimated in the several millions of dollars. If we had a building, if we were going to put that money into bricks and mortar, it would be several millions of dollars more.
LISTNUM 1 \l 17104 We don't see that as a necessity, but the infrastructure, the inside, the servers that are needed, the HD cameras, all of those different things that face us in our immediate future as they face the industry, will be millions: five to eight if you want a range. I've been told 5 to $8 million.
LISTNUM 1 \l 17105 MS McMANUS: Brian has a capital budget. I can tell you in Thunder Bay in northwestern Ontario, the whole college had $100,000 for capital.
LISTNUM 1 \l 17106 So if you are running a broadcast program within that ‑‑ and that's the whole college, every department every program. So for us to be able to maintain our facilities, we just did a new build ourselves and we haven't had any capital put into our program for the last ten years.
LISTNUM 1 \l 17107 Everything we have had has been donated from broadcasters when they are upgrading, from all over the place. Our audio board from TSN from Toronto; that we happened to have an alumni there. So that's how we were trying to shoestring our environment together.
LISTNUM 1 \l 17108 We are training for them and we are competitive.
LISTNUM 1 \l 17109 COMMISSIONER WILLIAMS: How many graduates did you have, Ms McManus?
LISTNUM 1 \l 17110 MS McMANUS: Last year we graduated 34 students and we had taken 40. Right now 80 percent of them are working in the industry.
LISTNUM 1 \l 17111 COMMISSIONER WILLIAMS: Eighty percent.
LISTNUM 1 \l 17112 MS McMANUS: Eighty percent. It's the best year in a long time, so I'm proud of it.
LISTNUM 1 \l 17113 COMMISSIONER WILLIAMS: It sounds encouraging.
LISTNUM 1 \l 17114 What is your employment ratio?
LISTNUM 1 \l 17115 MR. ANTONSON: It ranges between 80 and 90. Last year it was 84 percent in terms of employment at the end.
LISTNUM 1 \l 17116 COMMISSIONER WILLIAMS: Actually, I'm glad that you jumped in. You should all jump in at will. I'm not just directing my questions to one member of the panel. It's just convenient and you can all answer as you wish.
LISTNUM 1 \l 17117 MS DAVIE: One of the things that I would like to add is that the new media initiative, the new media animation initiative came about at a time when the industry was looking for trained people. Vancouver was hiring digital animation people from Montreal or from Toronto or from England. There was nobody being trained in Vancouver for that vast and growing market.
LISTNUM 1 \l 17118 As things come down the pike, there is now virtual reality. There is special effects. There are so many new things that are coming. If we had to get in a capital line‑up for capital funds coming down the pike, it would take a long time. That industry is going to go south of the border or somewhere else if we can't move in an appropriate time.
LISTNUM 1 \l 17119 MS McMANUS: You asked about HD.
LISTNUM 1 \l 17120 COMMISSIONER WILLIAMS: Yes.
LISTNUM 1 \l 17121 MS McMANUS: It's not affordable for us. I mean, most broadcasters in the smaller markets will tell you it is not affordable for them right now. So for us to educate when we are not getting the funds from the provincial government, our college operating budgets have been cut back. We don't get an increase and we haven't for a while. So it is not something we can do unless there is a big campaign.
LISTNUM 1 \l 17122 We also know that some of the broadcasters who give to some of the high schools in the radio program for development would like to put some money into the areas where they are getting their personnel from, but with the way the policy is written up, they don't see how they can because of how it is written.
LISTNUM 1 \l 17123 We just went through that with Dougall Media buying in our market; that Fraser couldn't think of a way to give it to us with the way that it is written.
LISTNUM 1 \l 17124 So this is kind of like a win‑win for everybody. And it is still their option, their choice.
LISTNUM 1 \l 17125 COMMISSIONER WILLIAMS: I understand your proposal.
LISTNUM 1 \l 17126 How many of these broadcast training schools are there in Canada? Does every province have one?
LISTNUM 1 \l 17127 MR. ANTONSON: In Ontario there are 13. In British Columbia there is one, so we are in a very enviable position in terms of competition and so on. Alberta has three. Quebec has several.
LISTNUM 1 \l 17128 We determined, following your questions at the May hearings, that there are 15 operations in Quebec that we have now invited to come back into the fold and join the BEAC. One of them used to belong many, many years ago and our president, who was here in May, has now invited them to come back.
LISTNUM 1 \l 17129 There are a couple in the Maritimes.
LISTNUM 1 \l 17130 Absent the 15 that we weren't aware of in la belle province, there are 22 that we know of across Canada. And these are provincially administered. We are not talking about the private sector type operations.
LISTNUM 1 \l 17131 THE CHAIRPERSON: There is one in Saskatchewan, because we had radio hearings in Regina a month ago and there were applicants who were to provide scholarship to one of their ‑‑ there is a native technology school which does broadcasting in Saskatchewan.
LISTNUM 1 \l 17132 MR. ANTONSON: Okay, we will check that out. I wasn't aware of that.
LISTNUM 1 \l 17133 THE CHAIRPERSON: I think they are based in Saskatoon.
LISTNUM 1 \l 17134 MR. ANTONSON: Thank you. Another lead.
LISTNUM 1 \l 17135 COMMISSIONER WILLIAMS: Tell me about the types of consultation that your groups do with the broadcast industry in regards to future needs. You are training appropriately.
LISTNUM 1 \l 17136 MR. ANTONSON: Very heavy consultation. Each program, each member program of the Broadcast Educators Association has a very active advisory committee based in industry. In our case at BCIT we have about 40 people from British Columbia markets, the majority from Vancouver, some from Vancouver Island and from the Interior, who provide regular consultation.
LISTNUM 1 \l 17137 We have industry in the door all the time. People are guest lecturing. They are on the phone. They are hiring. We are very, very close to industry.
LISTNUM 1 \l 17138 In my discussions with people across the country, they have similar relationships with industry; very close.
LISTNUM 1 \l 17139 COMMISSIONER WILLIAMS: Are there co‑operative programs where students can go into ‑‑
LISTNUM 1 \l 17140 MR. ANTONSON: You bet; practicums, work rotations, co‑op education, all sorts of different programs.
LISTNUM 1 \l 17141 Our people certainly in their second year in all three programs are often more out of school than they are in, because they are working in industry and rotating. They will be gone for three weeks, then they are back for another three weeks and then gone for three weeks again, that sort of thing.
LISTNUM 1 \l 17142 They are very involved in industry; thus the high placement rates.
LISTNUM 1 \l 17143 COMMISSIONER WILLIAMS: There has been some prior focus on scholarships in that area. What is the cost to a student to attend your institution?
LISTNUM 1 \l 17144 MR. ANTONSON: At BCIT ‑‑ and Michelle can maybe confirm about her institution.
LISTNUM 1 \l 17145 At BCIT it's about $2,200 per term. By the time you throw books in and so on, books and videotape, or whatever supplies are needed, it's in excess of $5,000 per year.
LISTNUM 1 \l 17146 So for a two‑year diploma program such as ours, it's in excess of $10,000.
LISTNUM 1 \l 17147 MS McMANUS: Ours is about $3,700 per year.
LISTNUM 1 \l 17148 COMMISSIONER WILLIAMS: $3,700?
LISTNUM 1 \l 17149 MS McMANUS: That's what it is per year. And then of course depending on how many tapes. One of the things ‑‑ and I think BCIT does this as well ‑‑ we allow 24/7 access to our equipment. So if our students want to be camera people and want to spend a lot more hours than we are giving them with our equipment, they might buy more tapes. So they might up their costs on some of the items, depending on use.
LISTNUM 1 \l 17150 We also give 24/7 access so outside of classroom time we allow that activity to happen.
LISTNUM 1 \l 17151 COMMISSIONER WILLIAMS: You have a program at BCIT called FilmFLEX program?
LISTNUM 1 \l 17152 MR. ANTONSON: FilmFLEX, yes.
LISTNUM 1 \l 17153 COMMISSIONER WILLIAMS: What is the tuition for that program?
LISTNUM 1 \l 17154 MR. ANTONSON: $27,500 per year. It's a very high end program. The really unique thing about it, there are other film schools that charge similar amounts of money for about a ten‑month program. At BCIT we have a 12‑month program. When you come in the door, you receive a digital camera, a Panasonic digital camera worth about $5,000 or $6,000, an Apple laptop computer loaded with editing software and all of that sort of stuff, accessories, tripod ‑‑ an equipment package that is worth about $16,000.
LISTNUM 1 \l 17155 When you leave our hallowed halls a year later, you pay us a dollar and that package becomes yours. So you have your digital editing platform when you walk out the door.
LISTNUM 1 \l 17156 So in effect the tuition that a person has paid is around $11,000. The equipment package is theirs and they go off into the industry with that.
LISTNUM 1 \l 17157 COMMISSIONER WILLIAMS: Thank you.
LISTNUM 1 \l 17158 In terms of these capital grants, should there be some form of cap on a capital grant allocated to any training institution that is fortunate enough to receive one as the result of a transaction?
LISTNUM 1 \l 17159 MR. ANTONSON: Should you put a cap on that?
LISTNUM 1 \l 17160 COMMISSIONER WILLIAMS: Yes.
LISTNUM 1 \l 17161 MR. ANTONSON: We don't think so. Certainly they would have to be realistic capital grants.
LISTNUM 1 \l 17162 MS DAVIE: And there would be proposals made.
LISTNUM 1 \l 17163 MR. ANTONSON: Yes. And you wouldn't have to accept that at all if you felt uncomfortable with it.
LISTNUM 1 \l 17164 MS DAVIE: So if the proposal didn't make sense ‑‑
LISTNUM 1 \l 17165 COMMISSIONER WILLIAMS: Yes. We could ‑‑
LISTNUM 1 \l 17166 MR. McMANUS: And the broadcasters would definitely want to keep us in line with what we are asking.
LISTNUM 1 \l 17167 MR. ANTONSON: Yes. It wouldn't be an unlimited type thing, but it would give them an opportunity.
LISTNUM 1 \l 17168 We had one person we talked to who flatly refused to discuss anything with me because it wasn't written in policy. I pointed to the precedent, the good stuff that had happened that you see listed in front of you, and he said until I see it written in policy I won't have any further discussion with you.
LISTNUM 1 \l 17169 The result there was zero. He wasn't even willing to bring it to you to say would you consider this?
LISTNUM 1 \l 17170 COMMISSIONER WILLIAMS: I imagine if the policy did change, that would be one of your first phone calls then.
LISTNUM 1 \l 17171 MR. ANTONSON: Well, you would have to have an application before you in order to make it happen.
LISTNUM 1 \l 17172 COMMISSIONER WILLIAMS: Exactly.
LISTNUM 1 \l 17173 MR. ANTONSON: That is the kind of thing that we are hoping to change so that a person like that would say you know what, I'd like to talk to you. Then they would come to an understanding of what they would do and away it would go.
LISTNUM 1 \l 17174 When BCE was buying CTV, we made a presentation. We asked for a lot of money and not knowing what we might get, we had envisioned a completely new facility, a building and so on. Out of the $230 million or so that they had to give away at the time to tangible benefits, they gave about $17.5 million to education and $1.5 million came to us at BCIT. We were thrilled.
LISTNUM 1 \l 17175 It was the largest, and still is the largest, cash donation that our institution had ever received.
LISTNUM 1 \l 17176 MS DAVIE: But we were very responsible with that money. We put that money into the new media centre and also put $500,000 into an endowment, which that money can then accrue to keeping the facility updated.
LISTNUM 1 \l 17177 So I think that we were wise in the way we spent the money.
LISTNUM 1 \l 17178 And some of the money also went to scholarships. It's not as though we don't want to be recognized or the industry to be recognized for giving scholarships to students. It's very worthy and part of what we want to do as well.
LISTNUM 1 \l 17179 COMMISSIONER WILLIAMS: Yes, it appears to be a very nice facility.
LISTNUM 1 \l 17180 MR. ANTONSON: It works well, yes.
LISTNUM 1 \l 17181 COMMISSIONER WILLIAMS: Has your need been satisfied now and should we be looking to other parts of the country, or should broadcasters be looking to other parts? Or is there an ongoing need?
LISTNUM 1 \l 17182 MR. ANTONSON: Laura's immediate need was addressed four years ago with that donation. She has other needs. She has great ideas that need work and development.
LISTNUM 1 \l 17183 My need in my broadcast programs, absent the FilmFLEX program ‑‑ that doesn't get looked after because of the equipment that is part of the package. The remaining three broadcast programs ‑‑ radio, television and broadcast journalism ‑‑ have significant needs and they will be an ongoing need.
LISTNUM 1 \l 17184 The biggest need right now, of course, is HDTV coming around the corner, and television is ill prepared to handle that.
LISTNUM 1 \l 17185 COMMISSIONER WILLIAMS: Thank you very much.
LISTNUM 1 \l 17186 Those are my questions, Mr. Chair.
LISTNUM 1 \l 17187 THE CHAIRPERSON: Thank you, Mr. Williams.
LISTNUM 1 \l 17188 I have only one question, I think.
LISTNUM 1 \l 17189 The representation that you made today is made on behalf of those institutions that are provincially financed for post secondary education. They are not making representation for all the other broadcasting courses that are given here and there.
LISTNUM 1 \l 17190 MR. ANTONSON: Yes. The private sector, they charge generally a lot more, and of course their capital plans are included in that.
LISTNUM 1 \l 17191 One in Vancouver, one private institution is ten or $12,000 for an eight‑month course as against our $10,000 for a full two years of training and so on.
LISTNUM 1 \l 17192 We are just speaking on behalf of provincially funded post‑secondary institutions, generally, colleges, institutes and in a couple of cases universities.
LISTNUM 1 \l 17193 MR. HILTON: I think, Mr. Chairman, what we were looking for was the provincial administration to be some sort of check on the quality of the program too.
LISTNUM 1 \l 17194 THE CHAIRPERSON: Well there is a curricula and a recognized diploma ‑‑
LISTNUM 1 \l 17195 MR. HILTON: Yes.
LISTNUM 1 \l 17196 THE CHAIRPERSON: ‑‑ or certificate of some kind?
LISTNUM 1 \l 17197 MR. HILTON: And a history. BCIT was the second institution to open up a broadcast program in 1964. We have been around for 42 years.
LISTNUM 1 \l 17198 Ryerson was the first in 1948, and since I am 58 years old, that was 58 years ago.
LISTNUM 1 \l 17199 THE CHAIRPERSON: So you were born on the campus?
‑‑‑ Laughter / Rires
LISTNUM 1 \l 17200 MR. HILTON: On the campus of Ryerson? No, I am a BCIT grad ‑‑ thank you very much and very proud of that ‑‑ from the 1960s.
LISTNUM 1 \l 17201 And all of the other colleges came with their programs in the late sixties to the early seventies.
LISTNUM 1 \l 17202 So these people have been around for the most part for decades and have very strong track records.
LISTNUM 1 \l 17203 THE CHAIRPERSON: Well, Mrs. Davie, Mrs. McManus, Mr. Hilton and Mr. Antonson, thank you very much for your presentation. He will be able to catch his plane and I hope you will be able to catch yours as well.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 17204 THE CHAIRPERSON: Thank you very much for coming here today.
LISTNUM 1 \l 17205 MR. ANTONSON: Okay. Thank you for your time.
LISTNUM 1 \l 17206 LE PRÉSIDENT : Madame la Secrétaire.
LISTNUM 1 \l 17207 LA SECRÉTAIRE : Merci, Monsieur le Président.
LISTNUM 1 \l 17208 Je vais demander maintenant au prochain participant, qui est la Fédération nationale des communications, s'il voudrait se présenter à la table des participants.
‑‑‑ Pause
LISTNUM 1 \l 17209 LA SECRÉTAIRE : Monsieur Pierre Roger comparaît pour la Fédération.
LISTNUM 1 \l 17210 Monsieur Roger, vous avez 10 minutes pour votre présentation. Quand vous serez prêt.
PRÉSENTATION / PRESENTATION
LISTNUM 1 \l 17211 M. ROGER : Monsieur le Président, mesdames les conseillères, messieurs les conseillers, je suis Pierre Roger, Secrétaire général de la Fédération nationale des Communications, qui représente 7 000 artisans du secteur des communications, dont 11 syndicats chez les principaux télédiffuseurs privés et publics francophones du Québec, y compris dans les régions.
LISTNUM 1 \l 17212 Cette audience doit permettre aux télédiffuseurs de prendre le virage de la transmission numérique haute définition, tout en préservant l'accès universel et la gratuité des services de télévision privés et publics conventionnels, des services locaux et régionaux et des services provinciaux de télévision éducative ainsi qu'un canal communautaire.
LISTNUM 1 \l 17213 L'audience est aussi l'occasion de préserver le potentiel des titulaires de services de télévision de contribuer de la meilleure façon possible à la diffusion de programmation canadienne de haute qualité.
LISTNUM 1 \l 17214 Le CRTC devrait saisir l'opportunité de donner une priorité claire aux émissions de nouvelles et d'information, tel que le recommande le rapport du Comité sénatorial permanent des transports et des communications sur les médias d'information canadiens.
LISTNUM 1 \l 17215 Le CRTC pourrait, comme le recommandait le Comité permanent du patrimoine canadien en juin 2003, favoriser la diffusion d'émissions prioritaires durant les heures de grande écoute.
LISTNUM 1 \l 17216 La FNC continue de soutenir l'apport du plus grand nombre possible de sources de création de contenu original canadien. Cependant, il est temps de s'assurer que le secteur indépendant de la production télévisuelle ne puisse pas conserver le monopole de la production.
LISTNUM 1 \l 17217 Les objectifs initiaux de la loi consistent à offrir une programmation de qualité permettant de contrer les contenus étrangers, de préserver l'identité culturelle et la viabilité du système canadien de radiodiffusion et des entreprises qui le composent.
LISTNUM 1 \l 17218 Nous sommes favorables à un système de financement qui permette d'atteindre ces objectifs sans biais, c'est‑à‑dire un système qui permette l'égalité d'accès de tous les producteurs de contenus canadiens, y compris les diffuseurs privés et publics, au Fonds canadien de la télévision.
LISTNUM 1 \l 17219 Il n'est plus possible de soutenir le régime actuel de production qui confine entre les mains des télédiffuseurs et du financement public les coûts de programmation télévisuelle.
LISTNUM 1 \l 17220 Les producteurs ne paient en moyenne que 4 pour cent de ceux‑ci, alors que leurs revenus ont connu une croissance de 180 pour cent en 10 ans.
LISTNUM 1 \l 17221 Les télédiffuseurs, eux, assument 28,9 pour cent des coûts des émissions, et ce pour une hausse de revenus de 26 pour cent pendant cette même période.
LISTNUM 1 \l 17222 Les gouvernements financent 40 pour cent des coûts de production d'émissions, et ce taux augmente à 60 pour cent si Téléfilm Canada et le Fonds canadien de la télévision participent au financement, ce qui arrive dans environ le tiers des cas.
LISTNUM 1 \l 17223 Les émissions de nouvelles et d'information doivent demeurer au cour de nos préoccupations. En plus de constituer un élément déterminant de la démocratie, elles contribuent à la programmation canadienne et attirent de nombreux téléspectateurs.
LISTNUM 1 \l 17224 Selon un sondage réalisé en mars 2005 pour le Comité sénatorial permanent des transports et des communications sur les médias d'information canadiens, la télévision constitue la principale source d'informations et d'actualités des Canadiens, peu importe le type d'informations et d'actualités.
LISTNUM 1 \l 17225 Les titulaires de licences de télédiffusion conventionnelle doivent, pour conserver leur permis de diffusion, s'engager à maintenir en priorité l'investissement dans la programmation de leur service conventionnel.
LISTNUM 1 \l 17226 Les conséquences de la diversification des plate‑formes de diffusion pourraient conduire à une dégradation planifiée du contenu télévisuel pour contraindre indirectement les consommateurs à recourir à leurs services plus rémunérateurs et ainsi échapper à la réglementation.
LISTNUM 1 \l 17227 Le CRTC devra, à notre avis, s'assurer que les radiodiffuseurs en direct s'engagent à poursuivre la mission de leur chaîne principale, comme il l'a notamment fait au moment d'octroyer les permis d'exploitation des services spécialisés RDI et la télé des Arts.
LISTNUM 1 \l 17228 Une remise en question des modalités de transmission des émissions peut se faire dans la mesure où tout est mis en oeuvre pour garantir au public l'accessibilité universelle et gratuite aux services considérés comme étant prioritaires par le CRTC.
LISTNUM 1 \l 17229 Cela apparaît d'autant plus important que la télévision est la principale source où s'alimentent les citoyens pour s'informer.
LISTNUM 1 \l 17230 Nous avons le devoir de moderniser les systèmes de diffusion sans provoquer de déficit démocratique, ni de diminution des services actuellement offerts, en adoptant des mesures innovatrices.
LISTNUM 1 \l 17231 Le contraire serait gênant pour une société dont le gouvernement est considéré comme un leader à l'échelle internationale pour promouvoir l'universalité à un coût abordable et l'accessibilité de tous, sans discrimination aux nouvelles technologies.
LISTNUM 1 \l 17232 L'abandon de la gratuité des services de télévision conventionnels pourrait avoir un impact négatif sur les habitudes d'écoute à l'égard des médias conventionnels gratuits, particulièrement auprès des jeunes.
LISTNUM 1 \l 17233 Pour les jeunes Canadiens de 18 à 24 ans, l'accès gratuit aux médias est un facteur d'utilisation favorable.
LISTNUM 1 \l 17234 Sans pouvoir soumettre de solutions formelles de remplacement à la télévision en direct, la FNC croit qu'il est possible d'imaginer divers scénarios permettant d'acheminer gratuitement à tous les foyers les services actuels.
LISTNUM 1 \l 17235 La FNC insiste, cependant, sur la notion de remplacement de la transmission en direct par d'autres moyens technologiques et non de l'abandon complet du service gratuit de transmission.
LISTNUM 1 \l 17236 Les cablôdistributeurs et les distributeurs par satellite profitent du haut taux d'écoute des chaînes conventionnelles publiques et privées par les téléspectateurs francophones canadiens. Ces services comptent pour plus de la moitié de l'ensemble de l'écoute télévisuelle.
LISTNUM 1 \l 17237 Les télédiffuseurs conventionnels sont donc désavantagés par le système actuel, d'autant plus qu'ils doivent composer avec la concurrence des services spécialisés de télédiffusion, qui bénéficient de deux sources importantes de revenus, soit la publicité et les redevances de distribution.
LISTNUM 1 \l 17238 Plusieurs scénarios peuvent être envisagés compte tenu de l'impact positif de la télévision en direct pour l'industrie de la distribution et de l'importance d'assurer l'accessibilité aux services actuels.
LISTNUM 1 \l 17239 Les distributeurs pourraient être contraints d'offrir gratuitement aux consommateurs les services traditionnellement accessibles par ondes hertziennes.
LISTNUM 1 \l 17240 Les entreprises de télédistribution et de télédiffusion en direct par satellite pourraient aussi être contraintes de conjuguer leurs ressources économiques et techniques pour offrir la transmission gratuite de leurs émissions par d'autres technologies que les émetteurs terrestres.
LISTNUM 1 \l 17241 Les distributeurs pourraient devoir payer des redevances aux télédiffuseurs conventionnels.
LISTNUM 1 \l 17242 Il est souhaitable qu'un échéancier précis soit établi si la transmission en direct devait être abandonnée, de manière à ce que l'ensemble des intervenants conviennent rapidement des moyens à adopter pour offrir à la population les services de substitution nécessaires.
LISTNUM 1 \l 17243 Peu importe le modèle de distribution qui pourrait être mis en place, il est nécessaire de s'assurer du maintien de la substitution des signaux pour que les populations locales et régionales aient un accès à l'ensemble des stations locales et régionales des réseaux.
LISTNUM 1 \l 17244 En conclusion, la FNC recommande,
LISTNUM 1 \l 17245 ‑ compte tenu de l'importance et de l'habitude des Canadiens d'avoir un accès gratuit aux services télévisés des ondes hertziennes,
LISTNUM 1 \l 17246 ‑ compte tenu de l'importance de protéger la liberté de choix des téléspectateurs,
LISTNUM 1 \l 17247 ‑ compte tenu de l'importance de la viabilité de la télévision généraliste, qui contribue avantageusement à la protection de l'identité culturelle,
LISTNUM 1 \l 17248 ‑ compte tenu de l'impact de la programmation de la télévision conventionnelle sur plusieurs usagers des services de télédistribution,
LISTNUM 1 \l 17249 ‑ compte tenu des économies que les télédiffuseurs pourraient réaliser en regroupant leurs ressources dans le but de remplacer par d'autres moyens techniques la transmission en direct,
LISTNUM 1 \l 17250 ‑ que le CRTC, Patrimoine Canada, Industrie Canada et l'ensemble des composantes du système de télédiffusion et de télédistribution élaborent des solutions de remplacement à la transmission en direct pour maintenir l'accès gratuit des services terrestres actuels;
LISTNUM 1 \l 17251 ‑ que le CRTC établisse un échéancier permettant de mettre en place les nouveaux modes de distribution de manière à ce que lors de l'abandon de la télévision analogique, tous les Canadiens puissent continuer de recevoir leurs services conventionnels gratuitement;
LISTNUM 1 \l 17252 ‑ que le CRTC envisage sérieusement le versement de redevances aux diffuseurs de transmission en direct par les entreprises de distribution et que, si les redevances sont issues du territoire francophone, par exemple, elles soient obligatoirement dépensées par le diffuseur pour enrichir la programmation francophone d'un réseau;
LISTNUM 1 \l 17253 ‑ que, si le Conseil autorise la télévision en direct à abandonner complètement la distribution gratuite de sa programmation, obligeant ainsi l'ensemble de la population à payer un abonnement aux services de télédistribution pour accéder aux services traditionnellement offerts par transmission terrestre, le CRTC prévoit :
LISTNUM 1 \l 17254 ‑ le versement de redevances subséquentes aux télédiffuseurs, redevances qui devraient inclure des obligations claires et précises en matière de contenu canadien et en avantages concrets pour les téléspectateurs;
LISTNUM 1 \l 17255 ‑ le versement par les diffuseurs, par obligation fixée au renouvellement des licences, d'une part importante des économies issues du non‑renouvellement des émetteurs et de leur entretien dans l'enrichissement de la programmation;
LISTNUM 1 \l 17256 ‑ que les services de distribution télévisuelle réservent, peu importe les décisions relatives à la transmission terrestre, un espace pour l'ensemble des diffuseurs conventionnels afin qu'ils bénéficient des retombées de la vidéo sur demande et que le public ait un accès équitable à ce nouveau service;
LISTNUM 1 \l 17257 ‑ et que les services conventionnels de télévision s'engagent, par condition de licence, à maintenir le niveau de service actuel.
LISTNUM 1 \l 17258 Enfin, en matière de création et de présentation de contenu canadien, la FNC recommande :
LISTNUM 1 \l 17259 ‑ que l'on procède à une révision des règles d'allocation des fonds publics dédiés à la production et la concentration des politiques culturelles sur l'encouragement à la création, en établissant un financement basé sur des objectifs de création et un traitement égal entre tous les joueurs, qu'ils soient producteurs ou télédiffuseurs;
LISTNUM 1 \l 17260 ‑ que le CRTC applique minutieusement la Loi de la radiodiffusion de manière à encourager la création et la présentation d'une programmation canadienne, ce qui ne devrait pas circonscrire la création à l'industrie de la production indépendante;
LISTNUM 1 \l 17261 ‑ que le CRTC favorise la diffusion d'émissions prioritaires durant les heures de grande écoute;
LISTNUM 1 \l 17262 ‑ et que, finalement, le CRTC retienne les recommandations du Comité sénatorial permanent des transports et des communications en donnant une priorité claire aux émissions de nouvelles et d'information.
LISTNUM 1 \l 17263 Je suis disponible pour vos questions. Merci.
LISTNUM 1 \l 17264 LE PRÉSIDENT : Merci, Monsieur Roger.
LISTNUM 1 \l 17265 M. ROGER : Excusez le débit, je voudrais livrer la marchandise.
LISTNUM 1 \l 17266 CONSEILLER FRENCH : On peut s'excuser auprès de l'interprète.
‑‑‑ Rires / Laughter
LISTNUM 1 \l 17267 M. ROGER : Mais j'avais donné à l'interprète une version corrigée.
LISTNUM 1 \l 17268 CONSEILLER FRENCH : D'accord.
LISTNUM 1 \l 17269 COMMISSIONER WILLIAMS: The interpreter has kept up. I can vouch for the interpreter.
LISTNUM 1 \l 17270 LE PRÉSIDENT : Bon.
LISTNUM 1 \l 17271 M. ROGER : O.K.
LISTNUM 1 \l 17272 LE PRÉSIDENT : Vous dites dans votre mémoire que vous représentez 7 000 membres.
LISTNUM 1 \l 17273 M. ROGER : Oui.
LISTNUM 1 \l 17274 LE PRÉSIDENT : Essentiellement, ces 7 000 membres là, dans quel secteur industriel sont‑ils? Évidemment, dans le secteur des communications...
LISTNUM 1 \l 17275 M. ROGER : Oui.
LISTNUM 1 \l 17276 LE PRÉSIDENT : ...mais c'est dans les entreprises de...
LISTNUM 1 \l 17277 M. ROGER : Principalement dans les entreprises de radiodiffusion, télédiffusion, radiodiffusion, aussi dans les grands médias ‑‑ les grands quotidiens au Québec sont * La Presse +, * Le Devoir +, * Le Journal de Montréal + ‑‑ les grands quotidiens du groupe Gesca à travers le Québec, aussi certaines entreprises culturelles comme le Musée des Beaux‑Arts, entre autres.
LISTNUM 1 \l 17278 LE PRÉSIDENT : Donc, vous ne représentez pas des syndiqués qui travaillent dans le secteur de la production indépendante?
LISTNUM 1 \l 17279 M. ROGER : Non, ils sont représentés par une autre association.
LISTNUM 1 \l 17280 LE PRÉSIDENT : Ils sont représentés par une autre...
LISTNUM 1 \l 17281 Et vos membres sont à la fois chez Radio‑Canada et chez les diffuseurs privés?
LISTNUM 1 \l 17282 M. ROGER : Oui, tout à fait. Nous avons des membres qui sont à la fois journalistes, à la fois des gens qui participent à la production en tant que technicien, assistant technique et autre.
LISTNUM 1 \l 17283 LE PRÉSIDENT : Autant dans le secteur public...
LISTNUM 1 \l 17284 M. ROGER : Oui.
LISTNUM 1 \l 17285 LE PRÉSIDENT : ...que dans le secteur privé?
LISTNUM 1 \l 17286 M. ROGER : Tout à fait. Nous représentons 1 400 artisans du côté de Radio‑Canada, entre autres.
LISTNUM 1 \l 17287 LE PRÉSIDENT : Puis dans le secteur privé, ils sont où, chez TVA, chez TQS?
LISTNUM 1 \l 17288 M. ROGER : Il y en a quelques‑uns chez TVA, mais principalement, je dirais, chez TQS. Il y en a à Télé‑Québec également et dans différentes stations en région comme on parlait ce matin. Je vous entendais avec les gens de Cogeco discuter du dossier de KRT. On représente les gens de KRT, Radio Nord, Carleton, des gens aussi isolés que ça.
LISTNUM 1 \l 17289 LE PRÉSIDENT : D'accord. Donc, ça nous situe.
LISTNUM 1 \l 17290 Un des enjeux, évidemment, qui va nous être présenté un peu plus tard cette semaine, au début de la semaine prochaine, c'est celui de la production indépendante, et où les associations qui les représentent nous disent de maintenir les niveaux actuels de production indépendante, voire même de les accroître dans certaines catégories d'émissions, notamment, soit en déterminant des montants fixes de revenus, soit en révisant la question des heures dites prioritaires pour y ajouter de nouvelles catégories, quelle est votre position par rapport, effectivement, à la production indépendante et aux questions qui sont soulevées chez ces associations ?
LISTNUM 1 \l 17291 M. ROGER: Si vous regardez, évidemment, on a annexé à notre présentation aussi un document...
LISTNUM 1 \l 17292 LE PRÉSIDENT: Oui, l'étude.
LISTNUM 1 \l 17293 M. ROGER: De la firme MCE Conseil.
LISTNUM 1 \l 17294 LE PRÉSIDENT: Oui.
LISTNUM 1 \l 17295 M. ROGER: Qui date de février 2005, mais on avait une autre étude auparavant et il y a un autre groupe qui va se présenter demain qui eux aussi ont présenté un document sur ce qui se passe dans le secteur de la production indépendante.
LISTNUM 1 \l 17296 Nous croyons que la production indépendante a été un apport très important dans le secteur de la radiodiffusion. Toutefois on constate au fil des ans qu'il y a une partie de ce qui aurait dû être construit par la production indépendante qui a raté son objectif.
LISTNUM 1 \l 17297 On se rappellera qu'ils devaient, au fil des années, capitaliser un peu plus ces gens‑là. Malheureusement, on s'aperçoit qu'ils investissent rarement plus que cinq pour cent dans la production.
LISTNUM 1 \l 17298 Les données que nous avons dans l'étude, ce sont des données qui proviennent du CRTC, de Statistiques Québec, Canada, ce sont des données publiques.
LISTNUM 1 \l 17299 On se rend bien compte que les gros investisseurs sont le gouvernement, finalement, et les télédiffuseurs mêmes comme tel, mais que ceux qui possèdent les droits, une fois qu'ils ont permis aux télédiffuseurs d'accéder à deux passes, habituellement, c'est le producteur. Ils repartent avec, ils vont revendre, surtout avec l'avenir du multiplateforme qui s'en vient.
LISTNUM 1 \l 17300 Je vous rappelle aussi que l'année dernière la vérificatrice générale du Canada avait soulevé quelques anomalies au niveau du Fonds canadien de la télévision à l'effet qu'elle trouvait que les objectifs n'étaient pas clairs, il restait peut‑être à revoir des choses.
LISTNUM 1 \l 17301 Elle trouvait aussi qu'au niveau des dépenses il y avait peut‑être des petites choses à examiner comme tel parce qu'on s'aperçoit que ce sont des gens qui gèrent d'immenses fonds publics comme tel, alors il y aurait peut‑être lieu de pousser un peu plus loin.
LISTNUM 1 \l 17302 Mais nous ne disons pas qu'il ne doit pas y avoir de production indépendante, je pense que c'est une industrie très importante pour l'enrichissement de la production télévisuelle canadienne, mais nous pensons que les télédiffuseurs traditionnels devraient pouvoir eux aussi avoir accès au Fonds canadien de la télévision s'ils veulent être capables de prendre le virage, entre autres, au multiplateforme comme tel.
LISTNUM 1 \l 17303 Ma réponse était trop longue ?
LISTNUM 1 \l 17304 LE PRÉSIDENT: Non, pas du tout. Non, non.
LISTNUM 1 \l 17305 En fait, vous avez couvert un peu de terrain sur mes questions.
LISTNUM 1 \l 17306 À votre avis, comment le Conseil pourrait‑il s'y prendre pour assurer que les principaux titulaires de services de télévision en direct fassent appel de façon notable à la production indépendante tout en maintenant les principes que vous avez annoncés, en améliorant leur performance ?
LISTNUM 1 \l 17307 Vous avez mentionné les critères d'accès au Fonds canadien de la télévision. Est‑ce qu'il y a d'autres critères que vous voyez qui seraient pertinents ?
LISTNUM 1 \l 17308 M. ROGER: Si le Conseil juge qu'il doit maintenir un minimum de production, il pourrait, mais c'est parce qu'il y a des télédiffuseurs qui sont pris avec des montants très élevés et ça leur laisse peu de chances d'eux‑mêmes produire, comme tel.
LISTNUM 1 \l 17309 Je pense qu'en quelque part, de toute évidence il y a des types de production que les télédiffuseurs ne peuvent pas faire dans leurs infrastructures parce qu'elles sont trop complexes.
LISTNUM 1 \l 17310 Je pense à des séries lourdes, entre autres, où ça prend souvent la part des producteurs indépendants.
LISTNUM 1 \l 17311 LE PRÉSIDENT: Cependant, les séries lourdes, les deux diffuseurs qui en ont financé, que ce soit Radio‑Canada ou TVA, se sont retirés de la production des séries lourdes.
LISTNUM 1 \l 17312 M. ROGER: Oui.
LISTNUM 1 \l 17313 LE PRÉSIDENT: Sous prétexte que ‑‑ et je pense que TVA l'a expliqué ‑‑ que des auditoires de 1 300 000, 1 500 000 ne peuvent pas supporter la diffusion de séries lourdes, ça prenait des auditoires de deux millions et demi et plus.
LISTNUM 1 \l 17314 M. ROGER: Oui.
LISTNUM 1 \l 17315 LE PRÉSIDENT: Comme ils ont déjà eu dans le temps, mais que ça n'existait plus.
LISTNUM 1 \l 17316 M. ROGER: Je pense que comme ils l'ont indiqué pour certains, il pourrait y avoir un certain retour sur leur investissement dans les séries lourdes s'ils avaient réussi à négocier les droits pour être capables de les utiliser sur d'autres plateformes ou d'avoir une première diffusion payante, après ça une diffusion gratuite, après ça sur d'autres supports, ça leur permettrait de rentabiliser leurs investissements. Ce qui n'est pas le cas actuellement.
LISTNUM 1 \l 17317 Habituellement, les droits de licence tels qu'on les connaît, les limitent habituellement à deux passes, alors ce n'est pas avec ça qu'ils réussissent à rentabiliser les importants investissements qu'ils font dans la production.
LISTNUM 1 \l 17318 LE PRÉSIDENT: Basé sur l'information que vos membres vous fournissent, est‑ce que la situation est la même à Radio‑Canada ? Est‑ce que Radio‑Canada est confronté au même type de difficulté que TVA le serait ?
LISTNUM 1 \l 17319 M. ROGER: Je vous dirais peut‑être pas à un même niveau parce que tout le monde sait qu'au niveau des règles du ECT, ils ont peut‑être quelques petits avantages, je pense qu'ils ont des montants réservés pour eux.
LISTNUM 1 \l 17320 Au niveau de Radio‑Canada, la plus grande problématique se situe plus au fait d'un financement qui soit stable et prévisible dans le temps, c'est leur grande problématique actuellement à Radio‑Canada.
LISTNUM 1 \l 17321 LE PRÉSIDENT: Dans votre mémoire, et je regarde, c'est l'article 2.3.1, vous n'avez pas besoin nécessairement d'y référer, mais vous dites que les émissions considérées prioritaires devraient faire l'objet de diffusion aux heures de grande écoute.
LISTNUM 1 \l 17322 Or, actuellement, les heures de grande écoute, pour les fins des émissions prioritaires, ont été identifiées par le Conseil comme devant être entre 19 h 00 et 23 h 00.
LISTNUM 1 \l 17323 Est‑ce que vous nous dites que cette fenêtre‑là est trop étroite ? Ou elle est trop large, ça devrait être entre 20 h 00 et 22 h 00 ou 21 h 00?
LISTNUM 1 \l 17324 M. ROGER: Non, on pense que la fenêtre pourrait être réajustée légèrement, peut‑être une heure auparavant en termes de début.
LISTNUM 1 \l 17325 Mais dans les faits, on pense que c'est important de maintenir une fenêtre dans laquelle on sait que c'est là où se situe principalement l'écoute.
LISTNUM 1 \l 17326 LE PRÉSIDENT: Maintenant, on a entendu TVA nous dire que les émissions prioritaires qui sont essentiellement de la dramatique, mais du documentaire, devrait être élargie pour contenir d'autres catégories d'émissions comme l'intérêt général.
LISTNUM 1 \l 17327 Est‑ce que vous avez un point de vue sur cette question‑là?
LISTNUM 1 \l 17328 M. ROGER: Oui. Enfin, on le mentionnait un peu dans l'intervention à savoir peut‑être des émissions axées sur l'information et d'intérêt... axées sur l'intérêt public comme tel, des émissions d'affaires publiques principalement et d'information.
LISTNUM 1 \l 17329 LE PRÉSIDENT: Vous avez fait état, vous avez dit vous‑même que, effectivement, l'avenir était au multiplateforme.
LISTNUM 1 \l 17330 Quelle est la position de la FNC par rapport à l'utilisation des multiplateformes par les diffuseurs chez qui vous vous trouvez des membres?
LISTNUM 1 \l 17331 M. ROGER: Il faut dire qu'on en est, je vous dirais, au balbutiement dans l'utilisation de ces technologies‑là.
LISTNUM 1 \l 17332 Il y a TVA qui l'utilise pour diffuser certaines émissions sur des canaux...
LISTNUM 1 \l 17333 LE PRÉSIDENT: En vidéo sur demande.
LISTNUM 1 \l 17334 M. ROGER: Oui, c'est ça. C'est plus ça qui se produit ou sinon on peut retrouver certains reportages de bulletins de nouvelles sur Internet.
LISTNUM 1 \l 17335 LE PRÉSIDENT: À l'Internet. Oui.
LISTNUM 1 \l 17336 M. ROGER: Tout à fait.
LISTNUM 1 \l 17337 LE PRÉSIDENT: Mais Radio‑Canada le fait aussi.
LISTNUM 1 \l 17338 M. ROGER: Oui, tout à fait, exactement.
LISTNUM 1 \l 17339 LE PRÉSIDENT: Radio‑Canada ne fait pas de vidéo sur demande.
LISTNUM 1 \l 17340 M. ROGER: Non.
LISTNUM 1 \l 17341 LE PRÉSIDENT: Mais cependant ils sont ouverts à la discussion.
LISTNUM 1 \l 17342 M. ROGER: Oui, mais...
LISTNUM 1 \l 17343 LE PRÉSIDENT: Je n'ai peut‑être pas compris ça dans ce forum‑ci cette semaine, mais je l'ai compris dans d'autres occasions, dans d'autres discussions.
LISTNUM 1 \l 17344 M. ROGER: Oui, c'est un peu pour ça qu'on avait prévu un volet pour la VSD, pour faire en sorte qu'il n'y ait pas juste TVA qui ait un statut privilégié de par son lien avec Vidéotron, mais qu'il faut que les autres télédiffuseurs puissent avoir accès aussi à de la bande passante dans le système de télédistribution pour être capables de diffuser autre chose sur des plateformes différentes.
LISTNUM 1 \l 17345 LE PRÉSIDENT: Je suis un petit peu confus. Vous nous parlez de la gratuité de la télévision, mais vous nous dites aussi également que vous comprenez le besoin à une redevance. J'essaie de réconcilier les deux.
LISTNUM 1 \l 17346 M. ROGER: O.K.
LISTNUM 1 \l 17347 LE PRÉSIDENT: Mais quelle est votre position, finalement? Parce que s'il y a une redevance, qui serait versée aux télédiffuseurs généralistes, on ne parlerait plus de la gratuité de la télévision, à tout le moins pour ceux qui sont abonnés aux entreprises de distribution.
LISTNUM 1 \l 17348 On parlera de la numérisation et de la technologie HD hertzienne après, mais je vais commencer par essayer de réconcilier votre notion de gratuité avec celle de redevances.
LISTNUM 1 \l 17349 M. ROGER: Évidemment, s'il est question de gratuité, ça va dépendre comment la redevance va être appliquée chez les télédistributeurs parce que si elle est amortie dans le coût actuel entre les différents joueurs, ça va avoir un coût nul pour le consommateur.
LISTNUM 1 \l 17350 Par contre, s'il y a surcharge, évidemment c'est le consommateur qui va payer la note, comme on dit.
LISTNUM 1 \l 17351 Mais en termes de gratuité, c'est parce que nous, on pense que...
LISTNUM 1 \l 17352 LE PRÉSIDENT: Donc, si je comprends bien, quand vous dites * gratuité +, c'est que vous épousez l'opinion de Quebecor qui dit qu'il faudrait que la... ça prend une redevance aux généralistes, mais le montant qui sera disponible pour les télédiffuseurs généralistes parce qu'ils ont exclu la télévision publique et Radio‑Canada ou Télé‑Québec, on en parlera dans un instant, et qu'ils récupéreraient cette redevance‑là des canaux spécialisés qui sont payants, qui sont actuellement offerts par Vidéotron.
LISTNUM 1 \l 17353 Donc, quand vous nous parlez de gratuité, c'est ce que vous voulez dire, que vous épousez la position de TVA?
LISTNUM 1 \l 17354 M. ROGER: Oui et non dans la mesure où... C'est parce qu'on ne voudrait pas perdre le principe de gratuité, mais évidemment, si la gratuité disparaît, c'est‑à‑dire que les canaux ne sont plus accessibles par émetteurs terrestres ‑‑ je vais vous donner un exemple ‑‑ ils pourraient être encore gratuits.
LISTNUM 1 \l 17355 Parce que les coûts qui leur sont engendrés par le maintien des émetteurs actuellement et, admettons, la mise en place de tout un réseau d'émetteurs numériques pourrait très bien servir à faire en sorte que ‑‑ je vais vous donner un exemple ‑‑ sur le câble on pourrait avoir un volet qui est un volet en bas du volet de base sur le câble qui serait gratuit.
LISTNUM 1 \l 17356 Quelqu'un veut s'abonner aux canaux généralistes uniquement parce qu'ils ne sont plus accessibles par antenne, une personne pourrait avoir une installation de câble chez elle, peut‑être qu'elle paierait l'installation ou qu'elle pourrait être subventionnée, mais ça ne lui coûterait rien pour recevoir les canaux actuellement généralistes gratuits.
LISTNUM 1 \l 17357 Toutefois, si cette personne décide d'accéder à n'importe quel volet, là elle doit payer le volet de base du câble.
LISTNUM 1 \l 17358 Et on connaît les compagnies de télédistribution, ils se feraient un plaisir de titiller le consommateur avec des petites gratuités pendant un mois ou deux pour les faire passer à un volet payant.
LISTNUM 1 \l 17359 Ça pourrait être une possibilité.
LISTNUM 1 \l 17360 LE PRÉSIDENT: Le financement de ce volet base base.
LISTNUM 1 \l 17361 M. ROGER: Oui, oui.
LISTNUM 1 \l 17362 LE PRÉSIDENT: Lui, il viendrait des télédiffuseurs généralistes.
LISTNUM 1 \l 17363 M. ROGER: Oui, ou des redevances. Une partie des redevances ou des télédiffuseurs généralistes parce que, évidemment, dans la redevance, j'imagine bien qu'il y a une portion que le télédiffuseur va garder pour gérer tout ça.
LISTNUM 1 \l 17364 Mais ça pourrait être un mélange des deux pour faire en sorte... Mais principalement, enfin, des télédiffuseurs traditionnels qui vont sauver des coûts à ne pas avoir à installer et à maintenir des émetteurs dans les régions comme tel.
LISTNUM 1 \l 17365 Ça permettrait aussi entre autres dans les régions à avoir accès aux signaux locaux pour les gens qui y avaient accès à l'antenne libre.
LISTNUM 1 \l 17366 LE PRÉSIDENT: Au cours des audiences, on a parlé de deux options, finalement, d'un système hybride où on a notre diffusion hertzienne essentiellement dans les marchés majeurs.
LISTNUM 1 \l 17367 M. ROGER: Oui.
LISTNUM 1 \l 17368 LE PRÉSIDENT: Je présume que pour le Québec on parlait essentiellement de Montréal et de Québec et dans les autres territoires ce serait les entreprises de distribution. Ou que ce soit exclusivement de la distribution par les entreprises existantes de distribution.
LISTNUM 1 \l 17369 Vous avez certainement des membres qui travaillent dans des sites de transmission, est‑ce qu'ils ont une opinion?
LISTNUM 1 \l 17370 M. ROGER: C'est peut‑être moins préoccupant que ça l'a déjà été, je vous dirais, parce qu'il y en a de moins en moins parce qu'il y a une grande partie de ces effectifs‑là qui ont été privatisés, sauf peut‑être à Radio‑Canada, je vous dirais, comme tel, mais dans les régions c'est souvent des sous‑traitants qui font l'entretien des sites d'émetteurs comme tel.
LISTNUM 1 \l 17371 LE PRÉSIDENT: Donc, ils ne sont pas membres chez vous.
LISTNUM 1 \l 17372 M. ROGER: Non, c'est ça.
LISTNUM 1 \l 17373 Mais on pense qu'un système mixte aussi pourrait très bien être viable à Montréal et ailleurs en région avoir un système qui permettrait, comme je viens de l'expliquer, d'avoir un base base sur le câble ou sur le satellite.
LISTNUM 1 \l 17374 LE PRÉSIDENT: On parle d'une date butoir pour l'implantation de la transmission numérique. Certains ont avancé deux ans après les États‑Unis en disant le 31 août. Or, si je fais le calcul, ça arrive toujours à deux ans et demi.
LISTNUM 1 \l 17375 D'autres ont parlé de trois. J'entendais Cogéco ce matin avancer 2012.
LISTNUM 1 \l 17376 Chez vos membres, est‑ce qu'il y a une préoccupation ou c'est une question qui pourrait être un enjeu?
LISTNUM 1 \l 17377 M. ROGER: Je vous dirais, il n'y a pas une véritable préoccupation à ce qu'on constate du côté francophone au Québec.
LISTNUM 1 \l 17378 Évidemment, le côté canadien anglophone est beaucoup plus à risque à cause des Américains comme tels.
LISTNUM 1 \l 17379 Alors, de toute façon, eux, ils subissent la pression énorme de la programmation américaine puis du virage numérique alors que chez nous, c'est moins présent.
LISTNUM 1 \l 17380 On dirais que l'industrie au Québec des télédiffuseurs fait en sorte de retarder le plus possible pour ne pas avoir à faire ce virage, entre autres, des émetteurs numériques.
LISTNUM 1 \l 17381 LE PRÉSIDENT: Écoutez; c'était l'ensemble des questions que je voulais discuter avec vous. Monsieur French.
LISTNUM 1 \l 17382 CONSEILLER FRENCH: Monsieur Roger, vous avez indiqué que la FNC préconiserait, advenant l'hypothèse que le Conseil excuse les diffuseurs de l'obligation de transmission terrestre et je cite :
* Le versement par les diffuseurs par obligation fixée au renouvellement des licences, une part importante des économies issues du non‑renouvellement des émetteurs et de leur entretien dans l'enrichissement de la programmation. +
LISTNUM 1 \l 17383 Est‑ce à dire que vous n'acceptez pas l'argent qui est que la transformation haute définition en soit crée un besoin des capitaux énormes et que c'est avec regret, mais en regardant froidement les chiffres et les coûts par unités desservies, qu'ils abandonnent l'idée ou qu'ils proposent d'abandonner l'idée d'une certaine partie ou de la totalité de leurs réseaux d'émetteurs?
LISTNUM 1 \l 17384 M. ROGER: Mais je pense que pour eux, les coûts les plus énormes sont plus à l'implantation d'un réseau d'émetteur numérique parce que pour ce qui est des outils de production interne, les coûts sont à peu près similaires à la vieille technologie qu'ils remplacent, la technologie numérique traditionnelle, si on peut dire.
LISTNUM 1 \l 17385 Parce que la haute définition aujourd'hui, les équipements sont très abordables, alors ça va dans un cycle normal de remplacement.
LISTNUM 1 \l 17386 Évidemment, pour eux, ils ne veulent pas s'embarquer dans un nouveau cycle d'émetteur terrestre et ça, c'est compréhensible quand on sait que dans certains marchés il y a à peine dix pour cent de personnes qui reçoivent par onde terrestre les signaux comme tels.
LISTNUM 1 \l 17387 Mais ils demeurent des marchés très importants, comme le soulignait monsieur le Président Arpin. C'est le marché de Montréal et Québec, entre autres.
LISTNUM 1 \l 17388 CONSEILLER FRENCH: Mais la question que je me pose c'est : où sont les économies? C'est comme vous...
LISTNUM 1 \l 17389 M. ROGER: Vous voulez dire pour les télédiffuseurs?
LISTNUM 1 \l 17390 CONSEILLER FRENCH: Oui.
LISTNUM 1 \l 17391 M. ROGER: Bien, c'est‑à‑dire que, évidemment, il y a des frais récurrents quand vous avez à entretenir des sites d'émetteurs comme tels, ça coût des sous. Vous n'avez plus ces frais‑là, alors, nous, on se dit, ils n'ont pas capitalisé pour mettre en place des émetteurs et à les entretenir. On pourrait à tout le moins s'assurer que ces sommes d'argent‑là vont aller à produire du contenu de programmation canadienne.
LISTNUM 1 \l 17392 CONSEILLER FRENCH: C'est comme si je vous indiquais que vous n'avez pas besoin d'acheter une deuxième voiture. Vous m'expliquerez il n'y a pas d'économie, là, vous avez besoin juste d'une seule voiture; c'est‑à‑dire ils n'atteignent personne avec... oui, ils vont atteindre à peu près personne.
LISTNUM 1 \l 17393 Je vois que votre prise de position est claire là, je le vois, mais je trouve la façon très curieuse de formuler la problématique. Je vous transmets...
LISTNUM 1 \l 17394 M. ROGER: Excusez‑moi; je n'ai peut‑être pas compris le sens.
LISTNUM 1 \l 17395 CONSEILLER FRENCH: Il faut aussi, je vous informe si vous ne le savez pas, vous le savez probablement fort bien que les conseils d'administration sont un peu moins enthousiastes de convertir les dépenses en capitaux en dépenses courantes.
LISTNUM 1 \l 17396 M. ROGER: Oui, oui, tout à fait, là. Ça, je sais bien.
LISTNUM 1 \l 17397 CONSEILLER FRENCH: Je vous remercie.
LISTNUM 1 \l 17398 M. ROGER: Non, mais ça, j'en suis tout à fait conscient aussi, mais c'est parce qu'il y a des frais quand même qui sont récurrents là, parce que le...
LISTNUM 1 \l 17399 CONSEILLER FRENCH: Non. Je comprends bien votre prise de position maintenant.
LISTNUM 1 \l 17400 LE PRÉSIDENT: J'aurais dû vous poser la question puisque ça a quand même fait l'objet de représentations et de Québecor et de TQS, que la redevance s'appliquerait exclusivement aux télédiffuseurs généralistes privés et comme vous représentez des membres autant chez Radio‑Canada que chez Télé‑Québec, peut‑être que vous avez une opinion autant que vous en avez chez les deux autres, que vous avez une opinion sur le sujet?
LISTNUM 1 \l 17401 M. ROGER: Bien, écoutez, je pense qu'on l'a mentionné dans notre mémoire. On pense que la redevance devrait s'appliquer également aux télédiffuseurs publics qui occupent... en tout cas dans le cas de Radio‑Canada, une part de marché très importante, là, dans l'écoute télévisuelle francophone.
LISTNUM 1 \l 17402 À moins que dans l'étude qui va se produire prochainement du dossier de Radio‑Canada, on consente à améliorer grandement les subsides alloués à Radio‑Canada, ça pourrait apporter un changement important, mais je pense qu'il faut rendre tous les joueurs équitables, là. On a décidé d'aller dans un système mixte au Canada, public, privé, bien allons‑y, là pour ces gens‑là aussi tant qu'à ça.
LISTNUM 1 \l 17403 LE PRÉSIDENT: Ma dernière question, je l'ai oubliée. Excusez‑moi, mais...
LISTNUM 1 \l 17404 M. ROGER: Elle est alambiquée ou...
LISTNUM 1 \l 17405 LE PRÉSIDENT: Non, non, non. Elle n'était pas alambiquée, mais... ah! oui. S'il y a redevance, elle devrait prendre effet à quel moment? Certains ont dit au moment du renouvellement des licences... j'entendais... quand on a entendu TQS, il aurait accepté de prendre une décision sur le banc, alors pour vous, quel moment une redevance, si le Conseil va dans cette direction‑là, devrait prendre effet?
LISTNUM 1 \l 17406 M. ROGER: Je croyais que TQS était reparti avec sa redevance, mais...
LISTNUM 1 \l 17407 Écoutez, je crois que... bien, c'est libre au Conseil. Le Conseil pourrait très bien décider de ne pas attendre... de ne pas attendre le renouvellement des licences et d'y aller de l'avant le plus rapidement possible, sentant un certain appel urgent. Il semblait y avoir quand même au sein des principaux joueurs un appel de dire : nous avons des difficultés et nous voulons rapidement avoir accès aux redevances.
LISTNUM 1 \l 17408 Moi, je pense que le plus tôt sera le mieux, si on doit le faire.
LISTNUM 1 \l 17409 LE PRÉSIDENT: Eh! bien là, c'est... merci, monsieur Roger, pour votre présentation. On va prendre dix minutes puis on sera de retour à 1545.
‑‑‑ Suspension à 1535 / Upon recessing at 1535
‑‑‑ Reprise à 1552 / Upon resuming at 1552
LISTNUM 1 \l 17410 LE PRÉSIDENT: Order please. A l'ordre s'il vous plaît.
LISTNUM 1 \l 17411 Madame la secrétaire.
LISTNUM 1 \l 17412 LA SECRÉTAIRE: Merci, Monsieur le Président.
LISTNUM 1 \l 17413 Nous procéderons maintenant aux prochains participants qui est la Société des auteurs et compositeurs dramatiques et la Société civile des auteurs multimédia.
LISTNUM 1 \l 17414 J'invite monsieur Robert Favreau à se présenter à la table des participants. Et son équipe.
‑‑‑ Pause
LISTNUM 1 \l 17415 LA SECRÉTAIRE: Monsieur Favreau, une fois que vous nous aurez présenté votre collègue, vous aurez dix minutes pour votre présentation.
LISTNUM 1 \l 17416 Quand vous voudrez.
PRÉSENTATION / PRESENTATION
LISTNUM 1 \l 17417 M. FAVREAU : Merci beaucoup.
LISTNUM 1 \l 17418 Je suis accompagné de madame Élisabeth Schlittler, déléguée générale de la Société des auteurs compositeurs dramatiques et de la Société civile des auteurs multimédia.
LISTNUM 1 \l 17419 Monsieur le Président, mesdames et messieurs les Commissaires, nous sommes particulièrement heureux que vous nous donniez l'occasion de vous présenter le point de vue des 1 400 auteurs, scénaristes et réalisateurs que nous représentons et qui sont éminemment concernés par les enjeux débattus à ces audiences.
LISTNUM 1 \l 17420 Tout être humain devient mature lorsqu'il peut se regarder dans la glace, se reconnaître tel qu'il est et même, lorsqu'il peut rire ce lui.
LISTNUM 1 \l 17421 Il en va de même des cultures qui, lorsqu'elles bannissent ou interdisent les images, freinent leur propre développement en imposant à leurs membres le repli sur soi.
LISTNUM 1 \l 17422 Si une telle pratique pouvait s'avérer sans grande conséquence à l'époque médiévale, s'y plier aujourd'hui condamnerait la société qui s'y conforme à l'asphyxie.
LISTNUM 1 \l 17423 Chaque culture, comme chaque être humain, a en effet besoin de ce miroir de soi que lui renvoie l'image de ses forces et de ses contradictions.
LISTNUM 1 \l 17424 Ces autoportraits sont autant de façons de se projeter dans le présent et dans l'avenir que de se remémorer d'où l'on vient.
LISTNUM 1 \l 17425 Qui plus est, c'est par eux que les générations futures pourront voir et mieux saisir ce que fut la vie et les défis de leurs parents et de leurs grands‑parents.
LISTNUM 1 \l 17426 Plus encore, ces portraits constituent autant de cartes de visite à présenter aux autres cultures de la planète en cette époque où les échanges avec les nations du monde sont devenus vitaux.
LISTNUM 1 \l 17427 Sur ce plan, l'époque qui est la nôtre est incomparable.
LISTNUM 1 \l 17428 En effet, peut‑on imaginer portrait plus détaillé et plus complet de la vie canadienne que celui que peuvent en offrir le cinéma, tant documentaire que de fiction, ainsi que les dramatiques télévisuelles ?
LISTNUM 1 \l 17429 La vie de tous les jours, les particularismes de chaque milieu ainsi que les enjeux de chaque époque y sont décrits jusque dans leurs moindres détails, des plus loufoques aux plus pointus.
LISTNUM 1 \l 17430 Ces portraits sont si riches qu'ils diffusent et font connaître dans un même élan plusieurs des autres arts qui ont cours dans notre société à une époque donnée.
LISTNUM 1 \l 17431 En effet, la danse, la musique, le théâtre, les arts plastiques et la littérature s'y retrouvent en même temps que les multiples représentations de ce que nous sommes, nous, terriens du troisième millénaire.
LISTNUM 1 \l 17432 Dans cette dynamique d'échange entre nous et les autres, le Canada, et plus particulièrement le Québec, nous sommes privilégiés.
LISTNUM 1 \l 17433 En effet, depuis plus de 20 ans, les Québécois raffolent de leurs séries télévisuelles, au point où les émissions francophones canadiennes comptent pour plus de 84 pour cent de l'écoute totale à la télévision québécoise.
LISTNUM 1 \l 17434 D'ailleurs, les 20 émissions les plus regardées sur les réseaux généralistes sont des productions québécoises.
LISTNUM 1 \l 17435 Elle est loin l'époque où Dallas régnait sans compétition sur nos ondes télévisuelles.
LISTNUM 1 \l 17436 Tous les espoirs sont permis pour l'avenir puisqu'un phénomène comparable se produit avec notre cinéma.
LISTNUM 1 \l 17437 En dix ans seulement, le cinéma québécois a vu son assistance passer de 550 000 personnes/année à près de cinq millions de spectateurs, soit une croissance annuelle de 27,5 pour cent alors que la fréquentation totale en salle ne connaissait qu'une augmentation annuelle de 2,6 pour cent.
LISTNUM 1 \l 17438 Donc, pour ce qui est de notre production dramatique, l'intérêt est multiplié par dix par rapport à l'intérêt des autres productions dramatiques venant des autres pays.
LISTNUM 1 \l 17439 La qualité est là incontestablement. Mais comment peut‑on nier le besoin véritable que semble confirmer un tel engouement ?
LISTNUM 1 \l 17440 En tout cas, nombreux sont les pays qui nous envient un tel niveau de pénétration de l'auditoire.
LISTNUM 1 \l 17441 Il serait cependant présomptueux et dangereux de tenir ce succès pour assuré. Cela ne s'est pas produit par magie et ne s'est pas bâti en un jour ni même en dix ans.
LISTNUM 1 \l 17442 Il en a fallu, des essais et des erreurs, des retours sur ceux‑ci ainsi que beaucoup d'imagination et de volonté pour mettre en place de nouvelles politiques de soutien public mieux ciblées.
LISTNUM 1 \l 17443 Pendant plus de 30 ans nous avons déployé efforts, détermination et talents pour parvenir à ces résultats.
LISTNUM 1 \l 17444 Cette réussite découle en partie des investissements consentis par les organismes de financement public, mais aussi par les télévisions généralistes, investissements qui ont permis l'éclosion de nombreux nouveaux talents.
LISTNUM 1 \l 17445 Le phénomène est d'ailleurs en pleine
croissance, le succès suscitant l'intérêt des nouvelles générations de créateurs qui ont le goût d'en être partie prenante.
LISTNUM 1 \l 17446 Dans ce contexte, vous pouvez comprendre que nous soyons inquiets des signes avant‑coureurs de récession du soutien public et de celui des télévisions généralistes.
LISTNUM 1 \l 17447 Avons‑nous vraiment le loisir, comme société, de revenir aux balbutiements d'il y a 30 ans alors que chaque insuccès en laissait présager de nombreux autres ?
LISTNUM 1 \l 17448 Si une telle chose advenait, aurions‑nous alors la capacité et l'énergie de reprendre cette croisade depuis ses tout débuts alors qu'elle a mis si longtemps à porter fruit ? Permettez‑nous d'en douter.
1600
LISTNUM 1 \l 17449 C'est pourquoi nous jugeons qu'il est urgent, voire impérieux, de non seulement maintenir, mais aussi d'accroître le soutien financier aux productions dramatiques canadiennes, tant télévisuelles que cinématographiques, ainsi qu'aux documentaires.
LISTNUM 1 \l 17450 Ces productions, fruit de l'imagination de leurs créateurs que sont les scénaristes et réalisateurs, réinventent et redonnent aux Canadiens ces images d'eux‑mêmes qui leur permettent d'évoluer. Ce sont leurs vitamines de l'âme.
LISTNUM 1 \l 17451 C'est pourquoi nous appuyons toute mesure qui verrait à consolider et à élargir le soutien à ces créateurs dont celle d'autoriser la création d'un tarif d'abonnement pour les télévisions généralistes.
LISTNUM 1 \l 17452 Chez les radiodiffuseurs, ce sont les généralistes qui sont les premiers et les principaux investisseurs dans la production dramatique canadienne, leur implication étant une condition de sine qua none à l'obtention de d'autres crédits publics.
LISTNUM 1 \l 17453 Nous pensons par ailleurs que de consacrer l'essentiel de ces nouveaux revenus aux seules fins de développement technologique constituerait une singulière erreur de perspective.
LISTNUM 1 \l 17454 On ne se contente pas de retaper la carrosserie quand le moteur a des ratés.
LISTNUM 1 \l 17455 La haute définition et le passage au numérique sont nécessaires mais n'ont d'intérêt que si l'audience se maintient et s'accroît pour ces productions dramatiques canadiennes de haute qualité qui s'adresseraient à tous les publics.
LISTNUM 1 \l 17456 Déjà la désaffection des générations montantes a de quoi nous inquiéter. Seules des productions dramatiques qui sauraient les rejoindre et qui auraient recours aux talents de nombreux jeunes créateurs ‑‑ comme cela se produit actuellement chez nos voisins du sud ‑‑ pourrait enrayer ce phénomène.
LISTNUM 1 \l 17457 Nous devons donc continuer à créer des dramatiques canadiennes de qualité en grand nombre, mais nous devons aussi nous assurer que ce genre, dans ses thématiques et son langage, se renouvelle.
LISTNUM 1 \l 17458 Il serait en effet risqué de se satisfaire des succès obtenus pour tenter d'en généraliser les recettes.
LISTNUM 1 \l 17459 Dans ce domaine, l'audace et l'expérimentation sont tout aussi déterminantes que la somme des investissements consentis.
LISTNUM 1 \l 17460 Or, l'histoire récente nous montre que ce sont essentiellement les télévisions publiques qui ont osé investir dans ces nouvelles formes narratives dont les créateurs ont l'audace.
LISTNUM 1 \l 17461 Leur marge de manoeuvre financière plus grande les aura probablement incités à encourager l'innovation.
LISTNUM 1 \l 17462 Après quelques années, les télévisions généralistes privées ont récupéré à leur tour ces productions, du moins celles qui ont connu un certain succès.
LISTNUM 1 \l 17463 Le rôle des radiodiffuseurs publics en est un de prospecteur. Ils doivent prendre des risques et parier sur de nouvelles formes qu'inventent nos raconteurs d'histoires et sur de nouvelles thématiques qu'ils explorent pour refléter l'évolution de la société qu'ils habitent.
LISTNUM 1 \l 17464 C'est pourquoi nous croyons que les revenus additionnels que procurerait aux télévisions généralistes un tarif d'abonnement devraient être destinés tout autant aux télévisions publiques qu'aux télévisions privées.
LISTNUM 1 \l 17465 Mais le financement n'est pas tout. L'accès à des fenêtres de diffusion avantageuses est tout aussi important. On n'a qu'à imaginer ce qu'entraînerait le maintien ou l'accroissement du soutien aux dramatiques canadiennes et aux documentaires si celui‑ci était combiné à l'abandon ou à la réduction de ses fenêtres de diffusion prioritaires.
LISTNUM 1 \l 17466 On constaterait alors, dès la première année, une diminution d'audience. La main gauche aurait alors détruit ce que la main droite avait si onéreusement cherché à construire.
LISTNUM 1 \l 17467 Non seulement les fenêtres prioritaires de diffusion des productions dramatiques canadiennes doivent être maintenues, mais elles doivent être imposées à l'ensemble des télévisions généralistes. Les iniquités existantes n'ont plus leur raison d'être.
LISTNUM 1 \l 17468 Par ailleurs, les fenêtres actuellement réservées aux documentaires doivent être revues car elles souffrent d'une marginalisation que ne justifie pas l'importance et le succès rencontrés par de nombreux documentaires au cours des dernières années.
LISTNUM 1 \l 17469 Dans la même veine, toute augmentation de la présence publicitaire au‑delà des 12 minutes actuellement permises comporterait de grands risques.
LISTNUM 1 \l 17470 Ajoutées aux autopromotions des réseaux, l'espace publicitaire occupe déjà près de 25 pour cent de l'heure télévisuelle. Au‑delà de cette limite, l'intérêt des spectateurs risque fort de s'émousser, lui qui se voit déjà sollicité de toutes parts.
LISTNUM 1 \l 17471 Mais il y a surtout le risque de rendre de plus en plus fragmenté et donc friable la relation qu'entretiennent les spectateurs aux personnages et au récit de nos dramatiques, tellement celles‑ci deviendraient saucissonnées d'innombrables promotions.
LISTNUM 1 \l 17472 Une fois cette relation ébréchée, l'intérêt pour nos histoires s'évanouira et, une fois encore, la main gauche aura détruit ce que la main droite avait cherché à bâtir.
LISTNUM 1 \l 17473 Quant à accroissement du placement média, c'est l'essence même de ces dramatiques qui risque d'être affecté. Les émissions dramatiques que nous imaginons appartiennent à l'imaginaire. Elles font rêver et nous permettent de pénétrer dans des univers qui nous sont peu ou pas connus.
LISTNUM 1 \l 17474 Le placement de produit n'a pas sa place dans une telle aventure, pas plus qu'une affiche géante de McDo n'en aurait sur le parcours d'Alice au pays des merveilles. L'espace imaginaire doit être mis à l'abri de l'appétit marchand.
LISTNUM 1 \l 17475 Enfin, et je conclurai là‑dessus, il faut rappeler que le succès considérable que notre cinéma et nos émissions dramatiques canadiennes ont connu depuis 20 ans coïncide avec l'essor fulgurant de la production indépendante au cours de la même période.
LISTNUM 1 \l 17476 Cette apparente coïncidence n'en est pas une. On devrait plutôt parler de relation de cause à effet.
LISTNUM 1 \l 17477 Par sa précarité même, la production indépendante se voit obligée d'être innovatrice, audacieuse, enthousiaste et extrêmement motivée tout en s'appuyant sur l'inventivité toujours renouvelée des scénaristes et réalisateurs qui créent les oeuvres qu'elle produit.
LISTNUM 1 \l 17478 La compétition et l'émulation qui se développent inévitablement entre les diverses unités de production qui la composent viennent amplifier ces atouts.
LISTNUM 1 \l 17479 Enfin, l'origine nécessairement composite de ces unités de création et des créateurs qui y évoluent assurent une grande diversité de la production qui en découle.
LISTNUM 1 \l 17480 Toutes ces qualités expliquent en grande partie les succès que nous connaissons présentement. Mais nous savons aussi que ces qualités s'émoussent rapidement à l'intérieur d'unités de production qui relèvent directement du diffuseur, sans parler de la bureaucratie qui accompagne inévitablement ce mode d'intégration de la production.
LISTNUM 1 \l 17481 Pour ces raisons, nous nous objectons fermement à toute volonté de rendre accessible aux unités de production gouvernées par les diffuseurs les programmes de soutien public à la production.
LISTNUM 1 \l 17482 En résumé, la nécessité d'augmenter les investissements des diffuseurs généralistes pour la production d'émissions dramatiques canadiennes justifie à elle seule l'autorisation d'un tarif d'abonnement pour ceux‑ci. Ce tarif doit être consenti tant aux diffuseurs généralistes publics que privés.
LISTNUM 1 \l 17483 Mais cette mesure n'aidera à préserver la qualité de la production de documentaires et de dramatiques canadiens que si ces oeuvres émanent du secteur de la production indépendante.
LISTNUM 1 \l 17484 De même, les répercussions d'une telle mesure ne porteront fruit qu'en autant que soient maintenues et généralisées à tous les diffuseurs généralistes les actuelles fenêtres prioritaires de diffusion de ces dramatiques canadiennes et que soient améliorées celles réservées aux documentaires.
LISTNUM 1 \l 17485 Enfin, il importe que ces fenêtres prioritaires de diffusion ne soient pas envahies plus qu'elles ne le sont déjà par l'univers étroit de la réclame au détriment de l'espace imaginaire et onirique que ces émissions cherchent à créer au profit de tous les Canadiens.
LISTNUM 1 \l 17486 Ceci complète notre présentation. Nous sommes disponibles pour répondre à vos questions s'il y a lieu.
LISTNUM 1 \l 17487 LE PRÉSIDENT: Merci, monsieur Favreau.
LISTNUM 1 \l 17488 Monsieur French.
LISTNUM 1 \l 17489 CONSEILLER FRENCH: Vous représentez un organisme dont l'objectif est de s'assurer que les créateurs qui eux travaillent souvent seuls sont respectés dans leurs droits, surtout droits financiers par rapport aux grandes entreprises qui réalisent leurs oeuvres.
LISTNUM 1 \l 17490 Est‑ce que c'est juste ?
LISTNUM 1 \l 17491 M. FAVREAU: Les créateurs que nous représentons, certains, plusieurs, la moitié je dirais, travaillent seuls effectivement, les scénaristes, seuls ou en très petites équipes, mais les réalisateurs que nous représentons également, eux travaillent avec parfois d'assez grosses équipes.
LISTNUM 1 \l 17492 Et oui, nous sommes là pour nous assurer que leurs droits soient respectés et qu'ils soient associés à l'exploitation économique de leurs oeuvres.
LISTNUM 1 \l 17493 CONSEILLER FRENCH: Pour ce faire, vous avez des fois besoin de vérifier les livres des différentes compagnies qui utilisent leurs oeuvres ?
LISTNUM 1 \l 17494 MME SCHLITTLER : Nous, notre lien direct, il est avec les chaînes de télévision et non pas avec les producteurs, parce qu'on n'est pas un syndicat d'auteur, on est une société de gestion collective qui voit à la défense des intérêts matériels et moraux, et donc, le lien, il est en direct avec les chaînes de télévision et pas les producteurs.
LISTNUM 1 \l 17495 Donc, non, on ne regarde pas les livres des producteurs.
LISTNUM 1 \l 17496 CONSEILLER FRENCH : Tout ça pour dire que vous avez besoin d'aller chercher la filière des revenus qui sont redevables à vos membres à l'intérieur d'un grand flux monétaire d'une entreprise corporative, que ce soit public ou privé?
LISTNUM 1 \l 17497 Ce n'est pas des questions pièges, hein, j'essaie de...
LISTNUM 1 \l 17498 MME SCHLITTLER : Non, non, non, non, mais moi, je veux juste essayer de la comprendre la question. Alors, peut‑être que je pense trop aux droits d'auteur.
LISTNUM 1 \l 17499 CONSEILLER FRENCH : Non, non. C'est probablement parce que mon français n'est pas à la hauteur, Madame, mais je vais simplifier la chose.
LISTNUM 1 \l 17500 Vous avez proposé dans votre mémoire que les redevances que vous croyez appropriées et bénéfiques au système ne devraient pas être permises par le Conseil, sauf dans le cas où ces redevances sont employées pour réaliser des oeuvres canadiennes qui n'auraient pas été réalisées dans le cours normal de l'activité commerciale de l'entreprise de radiodiffusion en question?
LISTNUM 1 \l 17501 M. FAVREAU : Dans le fond, notre position là‑dessus dit... il y a déjà un pourcentage qui est, au Québec, autour de 36‑37 pour cent ‑‑ dans le reste du Canada, c'est plutôt autour de 26‑27 pour cent ‑‑ des revenus des télévisions qui sont investis dans les productions canadiennes, dramatiques canadiennes et fenêtres prioritaires.
LISTNUM 1 \l 17502 On se dit juste s'il y a de nouveaux revenus, il faudrait qu'au minimum ces pourcentages‑là soient maintenus et, si possible, augmentés, parce que ce sont ces augmentations‑là, au cours des 20 dernières années, qui ont permis les performances que nous connaissons présentement.
LISTNUM 1 \l 17503 On se souvient encore, au Québec, il y a 20‑25 ans, ce que les gens fréquentaient sur nos réseaux de télévision, c'était, pour la plupart, des séries américaines, et si on regarde, d'ailleurs, la revitalisation de ces séries‑là du côté américain, en ce moment, les * Sopranos +, * Sex and the City +, et caetera, le risque pourrait être là si on ne maintient pas cet effort d'investissement de la part des télévisions généralistes.
LISTNUM 1 \l 17504 J'espère que j'ai répondu à votre question. Je n'en suis pas convaincu.
LISTNUM 1 \l 17505 CONSEILLER FRENCH : Pour nous, il s'agit de savoir si on serait en mesure, en tant qu'instance réglementaire, de savoir quel serait l'emploi de ces fonds‑là, et si cet emploi‑là était bel et bien dans le domaine de la production canadienne, quelle serait la correspondance entre ce montant‑là puis le montant de redevances, et caetera.
LISTNUM 1 \l 17506 Autrement dit, si vous nous dites vous êtes contents qu'on donne des redevances aux télévisions généralistes puis ça finit là, on n'a pas de problème, hein, parce qu'il n'y a pas d'évaluation, de vérification qui est nécessitée, et on a eu des diffuseurs, dont TQS, qui nous ont dit, bien, faites‑nous ça, on en a besoin pour nos finances, on en a besoin pour nos actionnaires.
LISTNUM 1 \l 17507 Alors, je crois percevoir que vous n'êtes pas d'accord avec ce genre d'emploi de ces fonds‑là.
LISTNUM 1 \l 17508 M. FAVREAU : Non.
LISTNUM 1 \l 17509 CONSEILLER FRENCH : Alors, là où je veux en venir, c'est est‑ce qu'il y a des mesures ‑‑ puis j'essaie de profiter de votre expérience ‑‑ de percevoir de l'argent auprès des larges institutions corporatives? Est‑ce qu'il y a des moyens de savoir la comptabilité, la vérification, le monitoring, l'évaluation qui nous permettrait de savoir réellement s'il y a un incrément sur la performance de base déjà établie de l'entreprise?
LISTNUM 1 \l 17510 M. FAVREAU : Pour ces moyens‑là, je serais mal placé pour y répondre, mais c'est certain, je dirais, en réponse à une question qui a été précédemment posée plus tôt dans l'après‑midi, qu'un des moyens serait que le CRTC... que cet établissement d'un tarif de redevances se fasse lors du renouvellement des licences et qu'au minimum, lors de ce renouvellement‑là, il y ait des conditions très nettes de posées au chapitre des proportions d'investissements dans la programmation et du maintien des fenêtres de diffusion.
LISTNUM 1 \l 17511 Mais on n'est pas... je ne crois pas, à moins qu'Elizabeth puisse dire jusqu'à quel point on est instrumenté à ce niveau‑là, mais je ne crois pas que nous le soyons.
LISTNUM 1 \l 17512 CONSEILLER FRENCH : En tout cas, on saisit bien la direction philosophique et l'esprit de vos recommandations, et on apprécie beaucoup que cette évaluation vient de personnes qui sont si proches du noyau créateur de ce complexe de productions audiovisuelles, et je souligne tout simplement que nous vivons dans ce monde malheureux où on doit présumer qu'il y aurait des problèmes d'implantation, de mise en marche, d'évaluation, par la suite, et on est obligé, donc, de penser à certaines nécessités très terre‑à‑terre et regrettables, mais néanmoins réelles, avant d'endosser ou de proposer des mesures.
LISTNUM 1 \l 17513 Mais tout ça pour dire que nous apprécions, encore une fois, votre point de vue, et je crois que mon collègue le Président a peut‑être une question.
LISTNUM 1 \l 17514 LE PRÉSIDENT : Le Commissaire Cugini en a également une.
LISTNUM 1 \l 17515 COMMISSIONER CUGINI: I hope you don't mind if I ask you a question in English.
LISTNUM 1 \l 17516 MR. FAVREAU: No.
LISTNUM 1 \l 17517 COMMISSIONER CUGINI: I am curious as to your objection to product placement and I was wondering if you could explain further for us how this would impair the creativity that goes into a drama if we were to relax the rules on advertising to accommodate product placement.
LISTNUM 1 \l 17518 MR. FAVREAU: Okay. I hope you have no objection if I answer in French.
LISTNUM 1 \l 17519 LE PRÉSIDENT : Soyez à l'aise pour répondre en français.
LISTNUM 1 \l 17520 M. FAVREAU : O.K. Merci.
LISTNUM 1 \l 17521 Le grand problème du placement de produit, c'est jusqu'où on le permet et à quel moment on le limite. Lorsque la mise en scène et les mises en situation dramatiques deviennent conditionnées par le placement de produit, à ce moment‑là, on se met à dénaturer les oeuvres.
LISTNUM 1 \l 17522 Par exemple, je ne nommerai pas de titre, mais il y a un récent film américain qui était sur nos écrans ‑‑ juste pour donner l'excès possible ‑‑ et Purolator investissait massivement à la production, et dans environ 75 pour cent des séquences, il y avait un agent Purolator, un camion Purolator, et caetera.
LISTNUM 1 \l 17523 Pour moi, c'est une belle illustration de jusqu'à quel point on peut basculer, où ce n'est plus la production d'un imaginaire ou la création d'un imaginaire qui est en route, mais plus la possibilité de placer des produits avec un prétexte de narratif, et c'est là qu'on se met à être extrêmement réticent et on se met à évaluer les risques, qui, pour nous, sont très grands, d'élargir le placement de produit et de l'autoriser massivement.
LISTNUM 1 \l 17524 COMMISSIONER CUGINI: And the alternative, which could have been that the drama wouldn't have been produced at all ‑‑ I mean that is the alternative, right, if Purolator had not come into that production that you just cited, perhaps that drama would have been left in development or a script would never have even been developed for such a drama.
LISTNUM 1 \l 17525 Are we running that risk if we don't relax the rules on product placement?
LISTNUM 1 \l 17526 M. FAVREAU : Il en demeure pas moins que malgré les temps difficiles qui sont vécus, il en demeure pas moins que les séries dramatiques canadiennes ont des auditoires qui varient entre 1 million, 1,4 million sur un bassin de population potentielle de 5 millions, incluant les bébés, incluant et caetera.
LISTNUM 1 \l 17527 Pour l'instant, on est loin d'être convaincu que la télévision pourrait se passer des émissions dramatiques canadiennes, à moins de désirer le retour en arrière au genre de télévision qui était beaucoup plus courante il y a 25 ans, et où, massivement, ce qui était fréquenté, c'était des émissions étrangères achetées à bon marché.
LISTNUM 1 \l 17528 Alors, c'est pour ça qu'on se dit, est‑ce qu'il y a panique à ce point‑là, est‑ce qu'il y a perte des revenus à ce point‑là? Tout le monde s'en inquiète à cause de l'apparition des nouvelles plate‑formes, mais il y a peu de gens qui peuvent vraiment donner un portrait exact du niveau de fragmentation qu'on va atteindre, et caetera, et caetera, et de la perte des revenus publicitaires.
LISTNUM 1 \l 17529 Alors, pour l'instant, on est sur la base des résultats, tant à la télévision, alors que les séries américaines étaient omniprésentes il y a 25 ans, tant au cinéma, alors que le cinéma étranger et particulièrement américain était omniprésent à venir jusqu'à il y a 10 ans.
LISTNUM 1 \l 17530 On réalise maintenant que nos séries dramatiques et nos films rejoignent les gens. Je ne crois pas que les gens vont vouloir que nos télévisions, entre autres, disent non, on n'a plus d'argent, on n'y va pas. Je pense qu'ils risquent d'en souffrir même au plan des abonnements.
LISTNUM 1 \l 17531 COMMISSIONER CUGINI: Thank you. Thank you very much.
LISTNUM 1 \l 17532 M. FAVREAU : Bienvenue.
LISTNUM 1 \l 17533 LE PRÉSIDENT : Monsieur Favreau, dans votre présentation d'aujourd'hui, vous nous demandez de restreindre les plages d'émissions prioritaires, et je faisais remarquer au précédent intervenant qu'elles étaient présentement entre 19 heures et 23 heures.
LISTNUM 1 \l 17534 Quand vous nous demandez de restreindre la plage, vous voulez qu'on réduise encore... que les émissions prioritaires soient présentées à des heures encore plus... quoi, entre 20 heures et 22 heures ou...
LISTNUM 1 \l 17535 M. FAVREAU : Non. Excusez‑moi, la formulation était probablement inadéquate, mais ce qu'on essaie de dire dans notre présentation, c'est le maintien de ces fenêtres de diffusion prioritaires, qui, pour nous autres, est absolument essentiel.
LISTNUM 1 \l 17536 LE PRÉSIDENT : D'accord.
LISTNUM 1 \l 17537 Et si je comprends bien l'essence de votre mémoire, c'est, essentiellement, sauf pour les redevances d'abonnement, c'est le statu quo pour les autres éléments de la politique qui sont actuellement en place?
LISTNUM 1 \l 17538 M. FAVREAU : Pour l'instant, oui. Nous avons choisi de cibler ça plus particulièrement en se disant que, au moment du renouvellement de certaines licences ou et caetera, on pourrait élargir les interrogations, mais pour l'instant on a ciblé sur ces questions‑là des audiences.
LISTNUM 1 \l 17539 LE PRÉSIDENT : De manière spécifique, parce qu'il y a certains intervenants qui proposent de revenir à la situation antérieure à 1999, où il y avait des pourcentages minima de dépenses en productions canadiennes.
LISTNUM 1 \l 17540 M. FAVREAU : Oui. Dans notre mémoire... et c'est pour ça qu'on n'a pas jugé bon de revenir lors de la présentation. Dans notre mémoire, on se dit qu'on doit au minimum maintenir les pourcentages qui sont là actuellement, basés sur les chiffres que le Conseil nous a révélés, et, si possible, de les accroître.
LISTNUM 1 \l 17541 Par contre, on se dit s'il y a de nouveaux revenus, ces pourcentages‑là étant liés aux revenus, si les revenus augmentent, donc, il va y avoir de nouveaux fonds, ce qui risque de rendre les difficultés actuelles beaucoup moins grandes si on y parvenait.
LISTNUM 1 \l 17542 LE PRÉSIDENT : Maintenant, TQS, n'ayant pas la force de TVA et de Radio‑Canada, a présentement des exigences moindres que ces deux réseaux généralistes là.
LISTNUM 1 \l 17543 Ce que vous dites dans votre mémoire, c'est que tout le monde devrait être sur un même pied d'égalité, c'est ce que j'ai bien compris?
LISTNUM 1 \l 17544 M. FAVREAU : Oui, tout à fait. Ils ont également accès, via la production indépendante, aux différents moyens de soutien public autres que ceux émergeant de la télévision elle‑même.
LISTNUM 1 \l 17545 LE PRÉSIDENT : D'accord.
LISTNUM 1 \l 17546 La SACD est une société de gestion du droit d'auteur. Je ne sais pas si vous avez eu l'occasion de suivre les débats, même qui ont eu lieu ce matin et au cours de la semaine, parce qu'on a entendu des opinions, de part et d'autre, à l'effet que si le Conseil imposait un tarif d'abonnement aux stations généralistes, enfin, que le Conseil n'avait pas le pouvoir de le faire parce qu'on entrait dans le champ de la législation en matière de la loi du droit d'auteur.
LISTNUM 1 \l 17547 C'est la position qui nous a été présentée par certains intervenants, notamment des entreprises de distribution. C'est sûr que les entreprises de radiodiffusion, avec leurs procureurs, nous ont présenté des opinions contraires à l'effet que le Conseil, dans sa propre loi constituante, a tous les pouvoirs et toutes les habilités pour émettre un tel tarif.
LISTNUM 1 \l 17548 Or, vous avez... et particulièrement madame Schlittler, qui oeuvre dans le domaine du droit d'auteur depuis maintenant de nombreuses années.
LISTNUM 1 \l 17549 Est‑ce que vous pouvez nous éclairer, d'une manière ou d'une autre, sur l'étendue de notre droit?
LISTNUM 1 \l 17550 MME SCHLITTLER : J'ai entendu la réflexion ce matin, et puis ce qu'on se proposait de faire, c'était de consulter nos avocats, justement, parce qu'on n'a pas d'opinion à donner sur l'avis.
LISTNUM 1 \l 17551 Franchement, je ne le sais pas. Personnellement, je l'ignore, mais je l'ai entendu ce matin pour la première fois, puis on va vérifier, effectivement.
LISTNUM 1 \l 17552 LE PRÉSIDENT : Et puis vous êtes invité à nous en faire...
LISTNUM 1 \l 17553 MME SCHLITTLER : ...à vous en faire part.
LISTNUM 1 \l 17554 LE PRÉSIDENT : ...part, parce qu'il y a une fenêtre qui se termine le 20 décembre pour nous déposer des commentaires supplémentaires ou des opinions, et vous êtes bienvenue pour le faire.
LISTNUM 1 \l 17555 MME SCHLITTLER : Merci.
LISTNUM 1 \l 17556 LE PRÉSIDENT : Monsieur Favreau, Madame Schlittler, je vous remercie de votre présence.
LISTNUM 1 \l 17557 M. FAVREAU : C'est nous qui vous remercions.
LISTNUM 1 \l 17558 LE PRÉSIDENT : Bienvenue.
LISTNUM 1 \l 17559 Madame la Secrétaire.
LISTNUM 1 \l 17560 LA SECRÉTAIRE : Merci, Monsieur le Président.
LISTNUM 1 \l 17561 I will now call on the last participant for the day, Shaw Rocket Fund, if they would come forward for their presentation.
‑‑‑ Pause
LISTNUM 1 \l 17562 THE SECRETARY: Ms Annabel Slaight is appearing on behalf of Shaw Rocket Fund.
LISTNUM 1 \l 17563 Once you have introduced your panel you can proceed with your 10 minute presentation.
LISTNUM 1 \l 17564 Thank you.
PRESENTATION / PRÉSENTATION
LISTNUM 1 \l 17565 MS SLAIGHT: Thank you.
LISTNUM 1 \l 17566 Before we begin we have a little video for you to brighten up the afternoon.
‑‑‑ Video presentation / Présentation Vidéo
LISTNUM 1 \l 17567 MS SLAIGHT: Good afternoon. The Shaw Rocket Fund is a permanent independent production fund certified by the CRTC and we are delighted to appear before the Commission for the first time in support of Canadian children's television.
LISTNUM 1 \l 17568 I am Annabel Slaight, Chairperson of the Shaw Rocket Fund, and with me is Agnes Augustin, President of the fund.
LISTNUM 1 \l 17569 The Shaw Rocket Fund is the only dedicated fund in Canada that focuses on the children's genre. Why should we all care a lot about children's television? It is very important for the well being of our country for our children to have high quality television produced for them by Canadians, not only to entertain them and to inform them, but to give them an early sense that Canadians can produce great stuff.
LISTNUM 1 \l 17570 Canadian children's television is important for the whole Canadian industry too, because children's television production is our incubator for excellence. Kids are so demanding that producers must be very relevant and also must take creative risks and innovate to succeed.
LISTNUM 1 \l 17571 For example, "Degrassi", the huge hit for teens, launched one of the first online series of mini episodes in the U.S. market.
LISTNUM 1 \l 17572 "This is Emily Yeung", part of the Daniel Cook TV franchise, launched simultaneously on VoD, Mobile and Online. This was the largest multi platform launch in Canada.
LISTNUM 1 \l 17573 The series "Life With Derek" promoted itself with three minute podcasts, and "Corner Gas", one of Canada's great TV success stories, came from a producer of children's television.
LISTNUM 1 \l 17574 Now back to the Shaw Rocket Fund.
LISTNUM 1 \l 17575 We have a super dedicated independent Board of Directors representing various aspects of the industry. Members include myself, founder of Owl magazines, books and TV; also Gigi Boyd, an independent producer and former director at Téléfilm; and Ken Stein, Senior Vice President of Corporate and Regulatory Affairs for Shaw.
LISTNUM 1 \l 17576 We have developed a great sense of the industry and a passionate belief in its importance to Canada and to future adult audiences. With our eight years experience with this fund, we know the sector, it's strengths and its challenges.
LISTNUM 1 \l 17577 Our funding comes from Shaw Communications BDU contributions and also from Star Choice, EastLink cable system and Delta Cable.
LISTNUM 1 \l 17578 Canadian children's television is one of Canada's great media success stories. Canadian children watch Canadian TV. Nordicity has recently reviewed Canadian children's programming and has found that four of the top 10 rated English language kid's programs and six of the top 10 French language kid's programs are Canadian.
LISTNUM 1 \l 17579 Canadian kid's programming also consistently achieves success globally. We have heard this time and time again from broadcasters around the world. They love our innovation.
LISTNUM 1 \l 17580 And yet, with all this success, the Canadian children's sector appears to be in decline. This worries us.
LISTNUM 1 \l 17581 Usually when a sector is doing well it's success is heralded and it is given more opportunities to lead. Success usually begets success, but we are not seeing this here.
LISTNUM 1 \l 17582 Now over to Agnes to look at the challenges in more depth.
LISTNUM 1 \l 17583 MS AUGUSTIN: We believe our broadcasting system is not serving our Canadian children as well as it should. Funding for children's production is on a continuous decline. CFTPA's 2006 profile reports a 37 percent decrease in the production dollars spent on Canadian children's programming since 1999.
LISTNUM 1 \l 17584 We haven't conducted a scientific study, but based on our review of the schedules of the major over the air broadcasters and on the funding applications we see, we know there are few time slots for children's programmings on these services.
LISTNUM 1 \l 17585 Our impression of the low priority given to kid's programs is supported by the CTF funding envelopes for these services. Keep in mind, the CTF envelopes for kid's programs reflect historical spending levels for each broadcaster.
LISTNUM 1 \l 17586 Only 6 percent of the monies in the $22 million CTV envelope is allocated to kids. For Global it is only $3.6 million; for CHUM there is virtually no CTF allocation for kids.
LISTNUM 1 \l 17587 The CBC situation is different. It has been granted 37 percent of the total CTF television budget and determines its own genre allocation. The CBC allocated for this year only 10 percent of its total CTF budget for kid's programming.
LISTNUM 1 \l 17588 The major French language over he air broadcasters have comparable envelopes for children's programming. On the other hand, the English and French language educational networks are huge supporters of children's programming, but they access only 1.8 percent of this year's total CTF budget for all their programming, including kid's.
LISTNUM 1 \l 17589 Canadian children love Canadian TV, and yet kid's shows receive minimal funding dollars and air time on mainstream television services. You can see why we are concerned.
LISTNUM 1 \l 17590 So we ask: Is this the way the broadcasting system should go?
LISTNUM 1 \l 17591 In Canada there appears to be a trend for kid's programming to be seen as suitable mainly for specialty and educational networks instead of the general interest over the air service.
LISTNUM 1 \l 17592 We believe strongly that this perspective is misguided. Conventional over the air services are supposed to provide a range of programming to meet the needs and tastes of the general audience, including children and families together.
LISTNUM 1 \l 17593 A significant number of Canadian families continue to rely on over the air services as their primary television source. Greater support of Canadian children's programming is needed from the broadcasting system. Over the air broadcasters have an important role to play.
LISTNUM 1 \l 17594 MS SLAIGHT: Based on the information that Agnes has shared with you, we have four recommendations.
LISTNUM 1 \l 17595 We recommend that children' programming be included in policy decisions.
LISTNUM 1 \l 17596 In this proceeding the Commission has an opportunity to set an agenda for the health of Canadian children's programming. We understand that the Commission intends to issue a policy framework for over the air services that will allow those services to better meet the Commission's expectations at the time of license renewal.
LISTNUM 1 \l 17597 In 1999 the decision was taken that children's programming did not require specific regulatory support in the Commission's television policy. Clearly this needs to be revisited.
LISTNUM 1 \l 17598 We recommend children's programming be included in all incentives.
LISTNUM 1 \l 17599 If the Commission keeps its existing priority programming approach, then the Commission, we feel, should introduce a specific requirement for our original hours of Canadian children's programming to be broadcast during appropriate viewing times for children.
LISTNUM 1 \l 17600 If the Commission decides to reimpose and expenditure requirement, then the proportion of those expenditures should be directed to children's programming.
LISTNUM 1 \l 17601 In the Commission's review of the 10 percent tangible benefits regime for ownership transactions, some portion of any such benefit should be directly to independently produced children's programming. Our children are that important.
LISTNUM 1 \l 17602 Our next recommendation is that we recommend support of new media specific to children's production.
LISTNUM 1 \l 17603 Because children's programming is an incubator of new ideas, new formats, new platforms and has such a huge potential to lead the industry, we request the Commission increase the Shaw Rocket Funds' ability to support new media initiatives.
LISTNUM 1 \l 17604 We support the Bell broadcast and new media funds proposal that independent funds be permitted to support projects that would have an eventual broadcast version but could start on different media platforms.
LISTNUM 1 \l 17605 Lastly, we recommend an increase to funding for children's programming.
LISTNUM 1 \l 17606 We feel very strongly that additional funding for children's programming is needed. We at the Shaw Rocket Fund, and our primary funder Shaw Communications, are prepared to do our part to fund more children's programming. With our eight years of experience in this sector, we are well positioned to provide greater support and we are motivated to do more.
LISTNUM 1 \l 17607 This could be accomplished if the Commission allowed Shaw Communications to make a modest increase in the contribution that it is permitted to make to the Shaw Rocket Fund.
LISTNUM 1 \l 17608 Specifically, we have discussed with Shaw the possibility that it would reallocated .4 percent of its contribution to Canadian programming from the CTF to the Shaw Rocket Fund. Currently Shaw's contribution to the rocket fund is capped at .6 percent. The proposal is that Shaw would increase its contribution to 1 percent. We estimate this would result in $3 to $4 million in extra funding for children's programming.
LISTNUM 1 \l 17609 Our proposal would allow us to support 12 to 15 additional productions for Canadian children per year and would have a minimal effect on the overall CTF budget.
LISTNUM 1 \l 17610 The Shaw Rocket Fund has now become the crucial source for funding of children's programming in Canada. Due to declining funding for producers from other sources, our fund faces greater demand than it ever has. We saw a 40 percent increase in applications this year. We believe that this is a reasonable way to help meet the objectives of the Act for Canadian children and to allow us to better meet the demand for funding of children's programming.
LISTNUM 1 \l 17611 Thank you.
LISTNUM 1 \l 17612 We have also given you a document that covers some of the points made in our presentation today in a tabular form for your reference and we welcome questions.
LISTNUM 1 \l 17613 THE CHAIRPERSON: Thank you, Mrs. Slaight.
LISTNUM 1 \l 17614 Commissioner Duncan...?
LISTNUM 1 \l 17615 COMMISSIONER DUNCAN: Thank you for the presentation. Your video hit the spot, perked us up at the end of the day.
LISTNUM 1 \l 17616 In your presentation, both today and in your written submission you highlight that there has been a 37 percent decrease in the production of Canadian children's programming.
LISTNUM 1 \l 17617 I am interested as to what factors you feel have contributed to that decrease.
LISTNUM 1 \l 17618 I'm thinking broadcasters are in the business to attract audiences, so I would be interested in your view as to what has contributed to that decrease.
LISTNUM 1 \l 17619 MS SLAIGHT: Agnes, do you want to answer that one?
LISTNUM 1 \l 17620 MS AUGUSTIN: There are various reasons. This was since 1999 the policy was in place with children's programming not considered a priority program. The incentives for the broadcasters were specifically for the time slots between 7:00 and 11:00 p.m. That was rectified somewhat with the drama policy, but there still wasn't an increase.
LISTNUM 1 \l 17621 In addition to that, there was also global effects that was I think hit by the European Union. They had some issues with their homegrown programming; that they were promoting that. So that actually affected all of the industry, including children's.
LISTNUM 1 \l 17622 Children's programming relies heavily on pre‑sales and co‑productions and it declined significantly with that.
LISTNUM 1 \l 17623 There were various aspects, but a lot of it had to do with the priority programming issue.
LISTNUM 1 \l 17624 COMMISSIONER DUNCAN: So prior to 1999 children's programming was considered priority and not afterwards?
LISTNUM 1 \l 17625 MS AUGUSTIN: At the appropriate viewing hours and then after 1999 it wasn't at that point.
LISTNUM 1 \l 17626 COMMISSIONER DUNCAN: Again on the global, would you just explain the global situation.
LISTNUM 1 \l 17627 MS AUGUSTIN: There was a shift with the ‑‑ the children's production was highly dependent on pre‑sales and co‑productions. After 1999 the European Union had put out a policy where they promoted homegrown production on their end. It affected overall production.
LISTNUM 1 \l 17628 COMMISSIONER DUNCAN: I see.
LISTNUM 1 \l 17629 MS AUGUSTIN: And for kids, because it was heavily relying on that source, there was a reduction as of that as well.
LISTNUM 1 \l 17630 COMMISSIONER DUNCAN: Do you regularly meet with the people at Global, for example, or CTV that make programming decisions to discuss children's programming and what their needs are, what they think their audience needs are?
LISTNUM 1 \l 17631 MS SLAIGHT: Our clients are really the children's producers and the Children's Independent Production Committee has a good relationship with broadcasters, I think, because they tend to do really good work.
LISTNUM 1 \l 17632 I think that we as an independent fund really don't want to get in between our clients and their broadcasters. But I think we do talk to them.
LISTNUM 1 \l 17633 MS AUGUSTIN: Yes, we do.
LISTNUM 1 \l 17634 COMMISSIONER DUNCAN: Talk to the broadcasters.
LISTNUM 1 \l 17635 I guess I'm just trying to think of ways that you might get your viewership up without it being dictated by the Commission.
LISTNUM 1 \l 17636 MS SLAIGHT: Well, the question for me is I'm wondering why it went down.
LISTNUM 1 \l 17637 COMMISSIONER DUNCAN: That was my question.
LISTNUM 1 \l 17638 MS SLAIGHT: It seems to me that any broadcaster whose responsibility is to serve a broad audience would not necessarily want to not serve our young people. I mean, there are all kinds of issues like brand loyalty, appealing to families.
LISTNUM 1 \l 17639 I'm actually totally bewildered and would love to know the answer as to why the children's market on over‑the‑air broadcasters kind of evaporated.
LISTNUM 1 \l 17640 COMMISSIONER DUNCAN: I think that was probably the origin of my question and I was really wondering if you have conversations with the people in charge of production, buying programming at the networks, if you have discussions with them as to that point.
LISTNUM 1 \l 17641 But you haven't had the opportunity to meet with them ‑‑
LISTNUM 1 \l 17642 MS SLAIGHT: We haven't asked that specific question to them. I really think that it is something that the whole children's production industry is dealing with.
LISTNUM 1 \l 17643 Our clients are busy going to make and sell programs to people who want to buy it and who are clamouring for it. And in those instances, those are the specialty channels and the educational channels.
LISTNUM 1 \l 17644 I don't know. It just doesn't feel right that a country is left with their over‑the‑air broadcasters really not doing very much for that audience, particularly in that there is certainly a segment of the audience out there, children and families, who don't have access to the tiered programs.
LISTNUM 1 \l 17645 COMMISSIONER DUNCAN: In your presentation you express concern that only 14 percent of the CTF's 2006 budget is allocated to children and youth programming, and you recommend the Commission review its commitments to Canadian children's programming and offer new incentives for funding that not only match other genres but are tailored to the needs of this genre and its audience.
LISTNUM 1 \l 17646 Do you have specific recommendations that you would like to suggest?
LISTNUM 1 \l 17647 MS SLAIGHT: Agnes, do you want to go with that one?
LISTNUM 1 \l 17648 MS AUGUSTIN: Those were the recommendations that we had in our ‑‑ the recommendations, as Annabel mentioned earlier, were that we actually requested that children's programming be included in all policy incentives, so the four points; that it be included in any incentive that would be provided to any other genre of programming.
LISTNUM 1 \l 17649 Also, as far as benefits packages were concerned, if there was any benefits package, that children's programming would be considered at that point.
LISTNUM 1 \l 17650 We also looked at the support of new media.
LISTNUM 1 \l 17651 The other request was the allocation from Shaw Communications, to increase our allocation to 1 percent, which would allow us to then support the industry and support the production.
LISTNUM 1 \l 17652 COMMISSIONER DUNCAN: I was thinking in terms of the drama credit, 150 percent drama credit. You don't have anything as specific as that for children's. You would leave it up to us.
LISTNUM 1 \l 17653 MS SLAIGHT: Actually, as specific I think as we would like to get is that children don't get forgotten. It seems in some instances they do or they get left to the last or, as one very humorous children's producer always says: Just because the audience is shorter why do the budgets have to be smaller and why does the money have to be less?
LISTNUM 1 \l 17654 Our concern is that we have seen an industry that is doing absolutely fantastically. When you get to talk to broadcasters from afar ‑‑ and we meet them because we actually have a Shaw Rocket prize that we give that is judged by international jury and children too. When you see what those people are saying about the range of programming that we have here and how special and how innovative it is, and then we kind of see children getting left to the end or even overlooked, we think this is a shame, because in fact it is not just the industry; it's our children as well.
LISTNUM 1 \l 17655 COMMISSIONER DUNCAN: That is probably something too that you want to pursue then and get a better understanding of the broadcaster's perspective on that.
LISTNUM 1 \l 17656 I don't know if you were here yesterday when Mr. Rogers was here. He mentioned about them developing a relationship, a closer relationship with broadcasters to pursue new advertising opportunities.
LISTNUM 1 \l 17657 I am just suggesting a similar type of ‑‑
LISTNUM 1 \l 17658 MS SLAIGHT: Yes, I think that is a very good idea. But nothing will be more effective ‑‑ because when we ask the question we will get one answer. But nothing will be more effective, when their licence renewals come up, to ask them about why and what their commitment to our young people should be.
LISTNUM 1 \l 17659 You have the ability to really do some slam dunking there where we can inquire only.
LISTNUM 1 \l 17660 COMMISSIONER DUNCAN: You recommend that funding, which is currently tied to obtaining a broadcasting licence fee, should be revisited to allow programming for new media and emerging technologies.
LISTNUM 1 \l 17661 Do you have recommendations with respect to the maximum percent of available funds that should be allowed for this purpose?
LISTNUM 1 \l 17662 MS AUGUSTIN: No, not at this point we don't have a recommendation. It is something that we would prefer to do more consultation on.
LISTNUM 1 \l 17663 We know that there are quite a few children's programs that have the opportunity to build an audience. The end result would be that it would be broadcast but it could start on other platforms. It really is very effective at generating an audience.
LISTNUM 1 \l 17664 As far as a percentage is concerned, we haven't established that, no. It would be something we would do in consultation with the industry.
LISTNUM 1 \l 17665 MS SLAIGHT: Also, this is really rapidly changing. Two years ago we wouldn't even have understood what the art or the possible is. Of course, no one can predict where kids are going to go in this stuff, and they are the early adopters.
LISTNUM 1 \l 17666 So I think flexibility is something that is needed. Again, it is a mindset.
LISTNUM 1 \l 17667 COMMISSIONER DUNCAN: I want to go back to my previous question where I started out by mentioning that your concern that only 14 percent of CTF's 2006 budget went to children's programming.
LISTNUM 1 \l 17668 I am just wondering on that point as well what efforts you are making with CTF to change that situation. That is not decided, as you know, by the Commission.
LISTNUM 1 \l 17669 MS AUGUSTIN: We understand that. One of the reasons we point that out is that that is part of the entire ‑‑ there are quite a few different issues at stake here as far as the decline in the amount of money being spent on children's programming.
LISTNUM 1 \l 17670 We have been in discussion with the CTF in regard to that, constantly.
LISTNUM 1 \l 17671 COMMISSIONER DUNCAN: Yes.
LISTNUM 1 \l 17672 MS AUGUSTIN: The new envelope system, kids' programming was one of the first genres that fit into the envelope system in 2003 prior to drama. So when that was established, there actually was a decrease. We went down from 23 percent of the CTF funding on children's down to 18 percent last year.
LISTNUM 1 \l 17673 As far as that is concerned, it's based on a spend, which is why we were identifying the amount of spend on the over‑the‑air broadcasters because it was based on historical spends in children's programming which prior to the envelope system was already declining.
LISTNUM 1 \l 17674 So the envelopes were established at a lesser amount, and continues.
LISTNUM 1 \l 17675 MS SLAIGHT: I think also one of the points that we have made before is that everyone in Canada is very interested in Canadian drama and that we have stories that we can tell in ways that entertain and involve all our audiences.
LISTNUM 1 \l 17676 A lot of children's programming ‑‑ I bet Agnes knows the exact number ‑‑ is drama programming. So there is already some huge success in drama programming happening right here in front of our eyes.
LISTNUM 1 \l 17677 MS AUGUSTIN: We average 80 to 85 percent of what we finance is children's drama.
LISTNUM 1 \l 17678 COMMISSIONER DUNCAN: Are you working with CTF? I'm just wondering what their approach is with regard to new media and emerging technologies.
LISTNUM 1 \l 17679 Do they have funding specifically for that purpose?
LISTNUM 1 \l 17680 MS AUGUSTIN: Telefilm has their new media fund that they have at the moment.
LISTNUM 1 \l 17681 COMMISSIONER DUNCAN: So that wouldn't come to you through CTF.
LISTNUM 1 \l 17682 MS AUGUSTIN: No. And that particular fund ‑‑ again what we are looking for is funding specifically for children's programming, and that one is a general fund.
LISTNUM 1 \l 17683 What we would like to be able to do with programming that we are financing, to be able to enhance and to be able to support the innovation of children's programming for Canadian children; so specific for children.
LISTNUM 1 \l 17684 COMMISSIONER DUNCAN: I understood that it was specific for children. I'm just trying to see what other options are available.
LISTNUM 1 \l 17685 So the CTF funding is not a possibility for that purpose?
LISTNUM 1 \l 17686 MS AUGUSTIN: No.
LISTNUM 1 \l 17687 MS SLAIGHT: You know, we sound a little bit like a broken record, I think, because we are always saying funding specific to children.
LISTNUM 1 \l 17688 The reason that I think that we sound like a broken record is that we constantly are seeing things for children and children as priorities pushed to the end of the line.
LISTNUM 1 \l 17689 What we are trying to do is to move it up to the front of the line or at least near the front of the line in everybody's mindset.
LISTNUM 1 \l 17690 COMMISSIONER DUNCAN: I noticed when we were talking with TVO the other day, they were pointing out how much of their program is watched by children. All their programming in daytime programming is watched by young children.
LISTNUM 1 \l 17691 So I don't understand, then, why broadcasters wouldn't be equally interested in the children's programming that you are producing.
LISTNUM 1 \l 17692 MS SLAIGHT: I'm looking forward to you asking them.
LISTNUM 1 \l 17693 COMMISSIONER DUNCAN: Regarding the proposal that new media and emerging technologies be funded, or that we remove that requirement that there be a broadcasting licence in order to qualify, how would we justify that that is consistent with fulfilling the objectives of the Broadcasting Act?
LISTNUM 1 \l 17694 I think in your submission today you suggested that it be allowed on the basis that it could eventually end up as full broadcasting?
LISTNUM 1 \l 17695 MS SLAIGHT: Yes. We are not suggesting that it happen totally outside the broadcast system, but to start in a different place.
LISTNUM 1 \l 17696 MS AUGUSTIN: Where there would be interest from broadcasters to air the program, should it be successful, absolutely.
LISTNUM 1 \l 17697 MS SLAIGHT: That really has to do with the fact that there are just different ways people are getting introduced to programming in general and since kids are the early adopters some neat new ways to bring people to programming and to involve them are happening outside the broadcast system. But we are not suggesting the they become unconnected. They need to remain connected.
LISTNUM 1 \l 17698 MS AUGUSTIN: Some programs in fact have, as we discussed, like through the podcasts and that sort of thing, to augment their program, but those need to be part of the actual series or something in order to qualify whereby it might be something that would be a one‑off that would still drive the series.
LISTNUM 1 \l 17699 So there are a few different alternatives there.
LISTNUM 1 \l 17700 COMMISSIONER DUNCAN: Thank you.
LISTNUM 1 \l 17701 You have mentioned drama here and I notice in your brief that you applaud Public Notice 2004‑38 for the importance that it places on children's drama.
LISTNUM 1 \l 17702 In your request today you are encouraging the Commission to support all genres of children's programming ‑‑ I believe you are actually suggesting that the Commission support all genres of children's programming.
LISTNUM 1 \l 17703 It is my understanding that drama was singled out because of the high cost and therefore it needed additional support.
LISTNUM 1 \l 17704 I'm just wondering if you are able to give us a cost comparison of producing a child's drama programming as compared to another?
LISTNUM 1 \l 17705 MS AUGUSTIN: It varies. That is something that ‑‑ drama definitely tends to be more expensive, however it depends on the type of production we see. We see types of productions that are documentaries, CG kids, the landscape with CG kids where they go across Canada with a host. So there are costs definitely attributed to that.
LISTNUM 1 \l 17706 It depends. I think that would be something that we would have to do an actual comparison on to see, but it varies.
LISTNUM 1 \l 17707 COMMISSIONER DUNCAN: In the tangible benefits program you are suggesting that a portion of those tangible benefits be allowed or allocated to children' programming?
LISTNUM 1 \l 17708 MS SLAIGHT: Well, yes.
LISTNUM 1 \l 17709 And we argued a lot about putting that statement in there because, as I said, what would that mean if the wrestling network overtook the monster truck network? Should children's programming get a benefit from that? I guess we would say that might be a bit unrealistic.
LISTNUM 1 \l 17710 But again, we said that because we think that there needs to be a way that people say "Remember the kids, they are an important part of this country and growing up and they get forgotten too often."
LISTNUM 1 \l 17711 COMMISSIONER DUNCAN: I notice you mentioned that some of the funding. You have funding from EastLink and Delta as well as Shaw in here, and Star Choice.
LISTNUM 1 \l 17712 I'm just wondering, refresh my memory on how the funding comes about from purchase and sale transactions, isn't it? So they make commitments?
LISTNUM 1 \l 17713 MS AUGUSTIN: To our fund?
LISTNUM 1 \l 17714 COMMISSIONER DUNCAN: Yes.
LISTNUM 1 \l 17715 MS AUGUSTIN: No, we are BDU. We are based on the 5 percent revenues so we are ‑‑
LISTNUM 1 \l 17716 COMMISSIONER DUNCAN: So they allocate that portion ‑‑
LISTNUM 1 \l 17717 MS AUGUSTIN: We are part of the 3 percent that goes toward an independent production fund.
LISTNUM 1 \l 17718 COMMISSIONER DUNCAN: Do you canvass other operators, to sort of try to encourage them to direct some ‑‑ you do do that?
LISTNUM 1 \l 17719 MS AUGUSTIN: We do, but there are just not many left.
LISTNUM 1 \l 17720 COMMISSIONER DUNCAN: No, that's true. Consolidation.
LISTNUM 1 \l 17721 MS SLAIGHT: Also, we really don't want to poach.
LISTNUM 1 \l 17722 MS AUGUSTIN: No, other private funds.
LISTNUM 1 \l 17723 MS SLAIGHT: We are pretty determined from what we have seen that children's television needs more money and more recognition, but we don't want to undercut other people. We are too polite for that.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 17724 COMMISSIONER DUNCAN: This suggestion that you made here today on page 8 of your oral brief, you have asked Shaw to increase their .4 percent allocation to 1 percent, or you are suggesting that we allow that.
LISTNUM 1 \l 17725 Has Shaw initiated an application to do this?
LISTNUM 1 \l 17726 MS AUGUSTIN: No.
LISTNUM 1 \l 17727 First, we want to make a comment that we do believe that there is a need for CTF funding in all of this, so the request wasn't coming from that. We do believe that CTF contributes to children's programming. And we understand that there is an application that would be required from Shaw to submit for a change to their condition of license.
LISTNUM 1 \l 17728 However, what we would like to see is that there would be a policy statement from the Commission that it is prepared to find ways for additional funding for children's programming is what we are looking for.
LISTNUM 1 \l 17729 MS SLAIGHT: That is one way it could happen, and obviously Shaw would need to submit an amendment to its condition of license to accomplish that.
LISTNUM 1 \l 17730 COMMISSIONER DUNCAN: I appreciate that. Thank you.
LISTNUM 1 \l 17731 Mr. Chairman...?
LISTNUM 1 \l 17732 THE CHAIRPERSON: Commissioner Cugini...?
LISTNUM 1 \l 17733 COMMISSIONER CUGINI: Thank you.
LISTNUM 1 \l 17734 Ms Slaight and Ms Augustin, welcome. I just have a couple of questions for you, just for my own information and education.
LISTNUM 1 \l 17735 A lot of what we hear about the CTF in particular and a lot of other funds is that they are over‑subscribed, i.e., they receive many more applications than they have money available for producers.
LISTNUM 1 \l 17736 What is the situation with the Shaw Rocket Fund? Is it similar?
LISTNUM 1 \l 17737 MS AUGUSTIN: This year we have gotten to a point where we had a 40 percent increase of applications.
LISTNUM 1 \l 17738 COMMISSIONER CUGINI: Increase in applications.
LISTNUM 1 \l 17739 MS AUGUSTIN: Applications for funding, yes.
LISTNUM 1 \l 17740 COMMISSIONER CUGINI: You weren't able to accommodate all of those applications with your funding?
LISTNUM 1 \l 17741 MS AUGUSTIN: Yes. This was the first year that we had to figure out how we could finance as much as we wanted to finance. Yes.
LISTNUM 1 \l 17742 We were at a point this year where we had an increase in the number of applications and we actually got to a point where we didn't have enough to finance all the productions that we would have liked to have financed for this year.
LISTNUM 1 \l 17743 COMMISSIONER CUGINI: How many hours did your funding result in?
LISTNUM 1 \l 17744 MS AUGUSTIN: To date we ‑‑ last year was, I believe, around 240 hours of programming.
LISTNUM 1 \l 17745 COMMISSIONER CUGINI: Do you have a split between how many of those hours went to specialty television and how many of those hours went to conventional?
LISTNUM 1 \l 17746 MS AUGUSTIN: We do have a split. I don't have that with me. The split would be by far ‑‑ again, we finance two series on CTV which are teen programs and the rest are ‑‑ we have a few on CBC, but the majority is from specialties.
LISTNUM 1 \l 17747 COMMISSIONER CUGINI: The majority is from specialties.
LISTNUM 1 \l 17748 MS AUGUSTIN: Yes.
LISTNUM 1 \l 17749 COMMISSIONER CUGINI: In order to access your fund the producers must have a broadcaster commitment?
LISTNUM 1 \l 17750 MS AUGUSTIN: Yes.
LISTNUM 1 \l 17751 COMMISSIONER CUGINI: How do you define "children"? Is it preschool to 17 or preschool to 12?
LISTNUM 1 \l 17752 MS AUGUSTIN: Children is 12 and under, is how we determine.
LISTNUM 1 \l 17753 COMMISSIONER CUGINI: Twelve and under.
LISTNUM 1 \l 17754 MS AUGUSTIN: Twelve and under.
LISTNUM 1 \l 17755 COMMISSIONER CUGINI: But you did finance the CTV tween show.
LISTNUM 1 \l 17756 MS AUGUSTIN: Yes. We also financed team and youth programming, as well as family.
LISTNUM 1 \l 17757 MS SLAIGHT: And family programming we define as programming that is important to children that they watch with their families.
LISTNUM 1 \l 17758 COMMISSIONER CUGINI: All right. That includes all genres within the category, like the animation, it could be drama, it could be comedy?
LISTNUM 1 \l 17759 MS SLAIGHT: Everything.
LISTNUM 1 \l 17760 MS AUGUSTIN: Yes.
LISTNUM 1 \l 17761 MS SLAIGHT: It's kind of funny actually that children's programming got to be called a genre, because children's programming is like a how‑to cooking show, it is a whole group of people.
LISTNUM 1 \l 17762 COMMISSIONER CUGINI: Your target audience.
LISTNUM 1 \l 17763 MS SLAIGHT: Yes. Yes. We say that too and I always think that maybe it is a better thing if we refer to them always as a target audience instead of a genre.
LISTNUM 1 \l 17764 COMMISSIONER CUGINI: Thank you.
LISTNUM 1 \l 17765 Thank you very much, Mr. Chairman.
LISTNUM 1 \l 17766 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 17767 Thank you, Mrs. Slaight; thank you, Mrs. Augustin.
LISTNUM 1 \l 17768 This is the end of the hearing for today. We will resume tomorrow at 8:30. Nous reprendrons demain à 8 h 30.
LISTNUM 1 \l 17769 Merci.
LISTNUM 1 \l 17770 MS SLAIGHT: Thank you very much.
‑‑‑ Whereupon the hearing adjourned at 1702, to resume
on Friday, December 1, 2006 at 0830 / L'audience
est ajournée à 1702, pour reprendre le vendredi
1 décembre 2006 à 0830
REPORTERS / STENOGRAPHES
_______________________ _______________________
Johanne Morin Jean Desaulniers
_______________________ _______________________
Monique Mahoney Madeleine Matte
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Sue Villeneuve Fiona Potvin
- Date modified: