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TRANSCRIPT OF PROCEEDINGS
FOR THE CANADIAN RADIO-TELEVISION AND
TELECOMMUNICATIONS COMMISSION
TRANSCRIPTION DES AUDIENCES DU
CONSEIL DE LA RADIODIFFUSION
ET DES TÉLÉCOMMUNICATIONS CANADIENNES
SUBJECT / SUJET:
CANADIAN TELEVISION POLICY REVIEW /
EXAMEN DES POLITIQUES DU CONSEIL
RELATIVES À LA TÉLÉVISION CANADIENNE
HELD AT: TENUE À:
Conference Centre Centre des conférences
Outaouais Room Salle Outaouais
Place du Portage Place du Portage
Phase IV Phase IV
Hull, Quebec Hull (Québec)
September 25, 1998 25 septembre 1998
Volume 3
StenoTran
Transcripts
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.
StenoTran
Canadian Radio-television and
Telecommunications Commission
Conseil de la radiodiffusion et des
télécommunications canadiennes
Transcript / Transcription
Public Hearing / Audience publique
Canadian Television Policy Review /
Examen des politiques du Conseil
relatives à la télévision canadienne
BEFORE / DEVANT:
Andrée Wylie Chairperson / Présidente
Vice-Chairperson, Radio-
television / Vice-
présidente, Radiodiffusion
Joan Pennefather Commissioner / Conseillère
Andrew Cardozo Commissioner / Conseiller
Martha Wilson Commissioner / Conseillère
David McKendry Commissioner / Conseiller
ALSO PRESENT / AUSSI PRÉSENTS:
Jean-Pierre Blais Commission Counsel /
Avocat du Conseil
Margot Patterson Articling Student /
Stagiaire
Carole Bénard / Secretaries/Secrétaires
Diane Santerre
Nick Ketchum Hearing Manager / Gérant de
l'audience
HELD AT: TENUE À:
Conference Centre Centre des conférences
Outaouais Room Salle Outaouais
Place du Portage Place du Portage
Phase IV Phase IV
Hull, Quebec Hull (Québec)
September 25, 1998 25 septembre 1998
Volume 3
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TABLE OF CONTENTS / TABLE DES MATIÈRES
PAGE
Presentation by / Présentation par:
Saskatchewan Communications Network 623
ACCESS, Learning and Skills Television 650
of Alberta Limited
Télé-Québec 674
Friends of Canadian Broadcasting 707
Council of Canadians 758
Western International Communications Limited 786
Mr. Chris Stark 871
Association of Canadian Advertisers, 907
Canadian Media Director's Council and
Institute of Canadian Advertising
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ERRATA
Volume 1
September 23, 1998 / Le 23 septembre 1998
Page Line /
Ligne
10 16 "Crop Four of"
should read / devrait se lire
"Crop for"
226 6 "your ship objectives"
should read / devrait se lire
"your viewership objectives"
229 20 "We have argued"
should read / devrait se lire
"MR. MILLER: We have argued"
233 23 "l'histoire du côté"
should read / devrait se lire
"l'auditoire du côté"
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623
1 Hull, Quebec / Hull (Québec)
2 --- Upon resuming on Friday, September 25, 1998
3 at 0905 / L'audience reprend le vendredi
4 25 septembre 1998, à 0905
5 2663 THE CHAIRPERSON: Madam Secretary,
6 would you please invite the next participants.
7 2664 MS BÉNARD: Thank you, Madam Chair.
8 2665 The first presentation this morning
9 will be by Saskatchewan Communications Network and I
10 would ask Mr. Benning to introduce his colleague.
11 PRESENTATION / PRÉSENTATION
12 2666 MR. BENNING: Good morning.
13 2667 My name is James Benning, and I am
14 the President and Chief Executive Officer of the
15 Saskatchewan Communications Network, Saskatchewan's
16 educational broadcaster. With me today is Richard
17 Gustin, SCN's Executive Director of Programming. We
18 would like to begin by thanking the Commission for
19 providing the opportunity for SCN to speak to issues
20 concerning the Canadian television broadcasting system.
21 2668 Television is undergoing a sustained
22 period of great change and growth in Canada. Not that
23 long ago there were only two or three television
24 stations available in most communities, and now
25 Canadians have so many choices they need "packages" to
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1 keep the numbers of channels to a manageable size.
2 2669 Television has become a big business.
3 Thousands of Canadians earn their living in television
4 and Canada has become the second-largest exporter of
5 television programming.
6 2670 SCN is not opposed to people earning
7 a living or making a profit in the television business.
8 However, in the current Canadian television system, the
9 opportunity for profit has eclipsed the need for public
10 service. SCN would like to see a system that reflects
11 the vision set out in the Broadcasting Act, and is able
12 to accommodate the needs of viewers to acquire
13 information about themselves, as well as having access
14 to an abundance of high quality made in Canada
15 entertainment.
16 2671 In the old days, when there were only
17 two or three TV stations in a region, they all had a
18 daily talk show, with a title like "Around the Town"
19 which gave viewers a chance to see themselves and what
20 was going on around them. Challenged by the CBC, which
21 was taking its public service mandate seriously,
22 broadcasters made an effort to tell us what was going
23 on in our lives.
24 2672 This truth telling function validated
25 television. Television became the box with a magic
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1 ability to make the world smaller and tell us stories.
2 Over time, the number of channels increased and so did
3 the number of stories being told. Most of these
4 channels and stories were from someplace else. Local
5 broadcasters have been absorbed into national systems,
6 and channels became focused on profitability.
7 2673 Saskatchewan has one of the most
8 dispersed and lowest population densities in Canada.
9 It has long and harsh winters. Community can be a
10 fragile thing when it's 40 below and town is miles
11 away. Only now are many of Saskatchewan's residents
12 able to receive this television cornucopia via DTH
13 satellite and wireless cable. What effect will this
14 bounty, which contains almost no Saskatchewan
15 information, have on these people and their sense of
16 community?
17 2674 MR. GUSTIN: SCN does not sell
18 advertising. It does not exist to earn a profit for
19 its shareholders. Using the cable and closed circuit
20 television networks, SCN strives to provide educational
21 and informational opportunities to the people of
22 Saskatchewan.
23 2675 SCN is the only television station
24 serving the province which is controlled and scheduled
25 from within Saskatchewan. SCN seems to be the only
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1 television broadcaster left with a mandate or interest
2 in addressing the needs of Saskatchewan's viewers.
3 With the exception of local news, sports, and weather,
4 and a couple of charity telethons, the CBC, CTV and
5 CanWest Global produce almost no local or regional
6 programming, informational or otherwise, in the
7 province.
8 2676 In particular, SCN regrets cutbacks
9 to the CBC and the effect this has had on regional
10 programming. SCN believes that the CBC has a
11 responsibility to provide public information
12 programming throughout its area of service. We are
13 impressed by the efforts of the CBC regional staff
14 that's left to do more with less, but the fact remains
15 that the Corporation, and the province's commercial
16 broadcasters have steadily reduced the level of service
17 provided.
18 2677 If there is going to be a public
19 service component to the mix, which the Broadcasting
20 Act stipulates there should be, it is up to the
21 Commission to help create an environment where public
22 service broadcasters and programming have a place in
23 the Canadian broadcasting system.
24 2678 MR. BENNING: The majority of SCN's
25 less than $8 million budget comes from the provincial
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1 government. With this budget, SCN delivers over 5,000
2 hours of programming on the broadcast network and over
3 3,000 hours of live televised, for-credit high school
4 and post-secondary classes on our training network.
5 2679 SCN does no in-house program
6 production, and is one of the leading supporters of the
7 Saskatchewan and Canadian independent production
8 industry.
9 2680 Saskatchewan has an active production
10 industry, but in order to sell to other markets, and to
11 attract production funds for tax credits, the product
12 must be generic enough to travel beyond the province's
13 borders. We are proud of the success that these
14 programs have achieved. This year Saskatchewan
15 productions licensed by SCN have been nominated for
16 Gemini Awards for Best Documentary and Best Children's
17 program or series.
18 2681 MR. GUSTIN: But there is a piece
19 missing. Where is the programming on television which
20 is about us?
21 2682 In its written submission, SCN
22 proposed that the program category "Regional
23 informational Program" be created and given special
24 status as an underrepresented program area, both in
25 terms of Canadian content rules and production fund
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1 eligibility.
2 2683 SCN would define a regional
3 information program as any commissioned non-dramatic
4 program or series which has as its primary purpose to
5 inform rather than entertain. It is a program whose
6 target audience is located in a specific geographic
7 area or region, and which would be of lesser use or
8 interest to an audience outside the area.
9 2684 These programs at present do not
10 qualify for any of the production support systems in
11 place, and are paid for entirely by the broadcaster.
12 2685 For example, SCN is currently
13 developing a series, which is targeted at Saskatchewan
14 students and their families. The commissioned series
15 will provide information which helps students
16 understand, plan and make choices regarding their
17 future education and employment.
18 2686 A regional broadcaster like SCN
19 should be commissioning such series on various issues.
20 In addition to the education series, the network would
21 like to be able to develop a weekly public affairs
22 program, which in turn might be able to spin off other
23 programs on specific subjects, such as aboriginal,
24 seniors and health issues.
25 2687 We believe that the Canadian
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1 broadcasting system has to meet a variety of needs as
2 defined in the Broadcasting Act, not just the profit
3 and return on investment requirements of commercial
4 operators. In its submission, SCN suggests that if
5 this review is to truly consider the status of the
6 Canadian broadcasting system, all sources of funding
7 involved should be looked at.
8 2688 SCN suggested the creation of a
9 production fund dedicated to regional information
10 programming needs. The fund must have a way to ensure
11 that the regions with the greatest needs, low
12 population densities, and high costs of service per
13 unit of audience have a priority access. The old
14 Department of Supply and Services fund, precursor of
15 the Canadian Independent Film and Video Fund, was an
16 excellent example of a program with good accessibility
17 to the country's regions.
18 2689 We recommend that the relationship
19 between the contribution of the broadcaster and the
20 fund remains as it is with the present CTF, but that
21 the cap be raised to a maximum of 50 per cent of
22 budget. SCN believes that such a fund should be
23 restricted to supporting commissioned programming
24 involving cash licenses, which would encourage the
25 broadcaster to work with the independent producers.
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1 2690 The regional fund would not have to
2 involve great sums of money. For a broadcaster such
3 SCN, an additional half a million dollars a year for
4 regional programming would make a huge difference in
5 our ability to address regional needs.
6 2691 MR. BENNING: SCN must acknowledge
7 the important role that the CTCPF and Shaw's Children's
8 Fund have played in the development of the Saskatchewan
9 production industry. Programs with a "Made in
10 Saskatchewan" label are showing up in inventories
11 around the world. And while we are proud of the
12 success stories of series like the "Incredible Story
13 Studio" and programs like "Dad," we still maintain that
14 there are other viewer needs that are not being
15 addressed.
16 2692 Production funds and drop fees are
17 the result of funding redistribution schemes. SCN
18 notes that specialty channels from TSN and MuchMusic,
19 to Newsworld and Vision get drop fees and would have a
20 very tough time surviving without them.
21 2693 The recently announced Aboriginal
22 People's Television Network is requesting a 15 cent per
23 subscriber per month drop fee. For any regional
24 broadcaster, a similar fee would have a substantial
25 impact. The fee could be dedicated to regional
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631
1 information programming, and if this money were able to
2 be matched by money from a regional production fund, an
3 even greater programming impact could be made. If, for
4 public policy reasons, the CRTC is adverse to allowing
5 public educational broadcasters drop fees, then some
6 other method of adjustment should be considered.
7 0915
8 2694 In its submission, SCN raised the
9 possibility of using Canadian content as a way of
10 encouraging regional programming. SCN agrees with
11 other ATEC broadcasters and recommends that Canadian
12 documentaries in prime time be also accorded special
13 Canadian content status.
14 2695 In conclusion, SCN would strongly
15 urge that the Commission reaffirm the role of public
16 and educational broadcasters and the importance of
17 regional and informational programming in the Canadian
18 broadcasting mix. SCN has no desire to strike down or
19 to take away from the success of commercial
20 broadcasters, but would like to see the vision of the
21 Broadcasting Act made real, with room and opportunity
22 for regional, informational and educational voices to
23 take their place in the Canadian television
24 broadcasting system.
25 2696 Thank you.
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1 2697 THE CHAIRPERSON: Thank you, Mr.
2 Benning, Mr. Gustin.
3 2698 Commissioner Cardozo?
4 2699 COMMISSIONER CARDOZO: Thanks, Madam
5 Chair.
6 2700 Thanks very much for that
7 presentation. We also thank you for staying overnight
8 from yesterday, although we heard your initial thoughts
9 yesterday, I suppose, with ATEC. Before we get to some
10 of the issues you have raised in terms of local
11 programming, I wonder if you could just give us a bit
12 more information about SCN and a bit more information
13 about the type of programming you have.
14 2701 As I understand your licence and
15 mandate, you are licensed as a provincial educational
16 broadcaster and you also call yourself a publicly
17 funded regional alternative specialty service. I have
18 to read that closely, but I understand the significance
19 of each one of those words. You provide classes live
20 to post-secondary and high school classrooms, as well
21 as instruction to people in their homes directly. Is
22 that a traditional academic style or is there also sort
23 of entertainment style education, the "Sesame Street"
24 sort of stuff?
25 2702 MR. BENNING: Just a little bit of
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1 background on how we operate, Mr. Commissioner. SCN
2 operates what we call our broadcast network, which is
3 satellite-based. It goes to all the cable companies in
4 the province, all 260-odd cable companies in the
5 province, and that has a mix of educational,
6 informational children's programs.
7 2703 The second network that we operate
8 and which you refer to which goes to the classrooms is
9 closed and it goes to about 170 classrooms around the
10 province. Its mandate is to provide live for credit
11 courses into those classrooms. A portion of them are
12 high school classes, the larger portion are post-
13 secondary, either for credit university or for credit
14 technical courses. Those are the 3,000 hours of
15 classes that we beam directly into the schools. On our
16 broadcast network we provide daily two hours a day
17 during the school year support programs for the various
18 courses K to 12.
19 2704 COMMISSIONER CARDOZO: So, most of
20 these classes are -- where are they being shot, where
21 are they being filmed, in classrooms in educational
22 institutions?
23 2705 MR. BENNING: We have a number of
24 what we call studio classrooms around the province,
25 both in the two universities, in the Saskatchewan
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1 Institute of Science and Technology and also in two
2 high schools. Those classes originate from those
3 studio classrooms.
4 2706 COMMISSIONER CARDOZO: The first
5 kind, the broadcast, where does that programming come
6 from? The first type of programming that you talked
7 about on your broadcast service.
8 2707 MR. BENNING: On the broadcast
9 network?
10 2708 COMMISSIONER CARDOZO: Yes.
11 2709 MR. BENNING: Our headend is in
12 Saskatoon and the programs that we broadcast are
13 programs that we acquire either locally or nationally
14 or from international suppliers. On that network we
15 produce virtually no programming ourselves.
16 2710 COMMISSIONER CARDOZO: Just to wrap
17 up this part of my questions, how much scope is there
18 for regional reflection within your network?
19 2711 MR. BENNING: In terms of regional
20 reflection, if one defines "regional" as Saskatchewan-
21 based, we produce or we acquire about 13 per cent of
22 the 5,000 hours a year is Saskatchewan-origin
23 programming. Our goal is to reach 20 per cent of our
24 total program mix, Saskatchewan-based. The chief
25 drawback at present is not the availability, but our
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1 ability to finance it.
2 2712 COMMISSIONER CARDOZO: So, would you
3 be of the opinion that you provide more Saskatchewan
4 regional programming to the viewer than the other
5 networks?
6 2713 MR. BENNING: Yes, clearly so.
7 2714 COMMISSIONER CARDOZO: You have
8 titled your brief "Voices in the Wilderness", which is
9 quite straightforward. Are these voices in the
10 wilderness more a matter of news or entertainment?
11 2715 MR. BENNING: It's not so much news,
12 it's a matter of information, information about what is
13 going on, what the issues are in Saskatchewan. One
14 must acknowledge that the other broadcasters do provide
15 local and provincial news from their stations, but in
16 terms of information programming, that is not being
17 done.
18 2716 COMMISSIONER CARDOZO: So, the news
19 you are saying is more or less satisfactory, the local
20 news that you get. That would be on like the half-hour
21 news at the end of the national news hour.
22 2717 MR. BENNING: All three of the other
23 networks carry out that function, that's true, and we
24 have no desire to get into the news business, in
25 fairness.
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1 2718 COMMISSIONER CARDOZO: No, I
2 understand that, but you are not asking them to do more
3 in terms of news, either?
4 2719 MR. BENNING: No.
5 2720 COMMISSIONER CARDOZO: You have
6 talked regional, informational programming and thanks
7 for a bit more of the definition in your presentation
8 this morning. Why would you feel it important that
9 such programming be commissioned as opposed to people
10 doing it on their own and coming and talking to you or
11 sending it in?
12 2721 MR. GUSTIN: I think there is a
13 couple of issues here. First of all, by commissioning
14 this material, it allows us to encourage the
15 development of the local indigenous industry. SCN has
16 no desire to become -- SCN does not have an edifice
17 complex. We are not looking at building a large
18 organization. We would much rather see a healthy,
19 vibrant production industry be developed in the
20 province.
21 2722 COMMISSIONER CARDOZO: So, what you
22 are talking about is the stuff being done independently
23 outside your --
24 2723 MR. GUSTIN: Exactly.
25 2724 COMMISSIONER CARDOZO: But it doesn't
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1 have to be commissioned -- if a producer came along
2 with a great idea and presented it to you either before
3 or after they had produced it, would you still be
4 interested?
5 2725 MR. GUSTIN: Oh, definitely so.
6 Since SCN began, we have been involved in over 350
7 Saskatchewan productions, anything from short form to
8 series and larger programs. So, we are very active in
9 that arena already. What we would like to be able to
10 do, however, is commission programming on specific
11 issues that are focused on specific regional interests.
12 2726 Most of the programming that we
13 participate in now has to find other participants so
14 that the producer will come to us. We are often the
15 broadcaster that provides the development support and
16 then, as the project is developed, the producer will
17 then go to other broadcasters, be it the other
18 educational broadcasters, the specialty channels or
19 wherever, to find the rest of the financing.
20 2727 What we are saying is -- and this is
21 a very good system. We have no complaints about that.
22 What our problem is is when we are looking at specific
23 issues that are specific to Saskatchewan that other
24 broadcasters are not interested in, that does not have
25 that ability to travel outside the province, those are
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1 still important issues and those are the areas that we
2 really feel there is a need to be able to address.
3 0925
4 2728 COMMISSIONER CARDOZO: Okay. Let me
5 just read you the sentence from your presentation
6 today. You say that, in terms of defining regional, it
7 is a program whose audience is located in a specific
8 geographic area, or region, and which would be of
9 lesser use or interest to an audience outside the area.
10 2729 One of the strengths I think of -- or
11 an argument can be made that one of the strengths of
12 having more regional programming in the system is that
13 people get a chance to learn about different regions.
14 So you wouldn't want it to be of exclusive use.
15 2730 This is just a bit of a conundrum as
16 to how you would deal with defining regional
17 programming. Yes, you want it of a very local nature,
18 but, if you are saying that -- well, you are not quite
19 saying that, but if I sort of extend this from what you
20 are saying that it ought to be of no interest to other
21 people -- you don't want to go that far.
22 2731 MR. GUSTIN: There are a number of
23 issues that have that sort of nature. Going to the
24 educational series that we have talked about, we are
25 particularly interested in focusing on issues about
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1 what happens when we have a rural student trying to
2 make the transition to an urban learning situation.
3 The specifics of funding and education in
4 Saskatchewan -- and every province has a different
5 environment that learners have to work in.
6 2732 If we were to make a series like this
7 so generic that it can travel across the country, we
8 have lost our ability to deal with this, to try to
9 inform the students and their families on the specifics
10 of getting continuing education in Saskatchewan, which
11 is the real issue that we are trying to address with
12 this series.
13 2733 COMMISSIONER CARDOZO: Okay. In
14 terms of the recommendation that you made in your
15 written brief, the suggestion that 20 per cent of the
16 CTCPF, the CTF, be set aside for regional programming,
17 that would go with the kind of definition that you
18 defined, that you provided us with today?
19 2734 MR. BENNING: That is correct, yes.
20 2735 COMMISSIONER CARDOZO: On page 13 you
21 suggested that we give 150 per cent credit for Canadian
22 content and 200 per cent if it is played in peak
23 viewing hours. Do you have a suggestion of regional
24 within that? When you are talking about Canadian
25 programming in this part you are not focusing on the
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1 regional aspect of programming, are you?
2 2736 MR. GUSTIN: No. Again, we are
3 focusing specifically on the regional programming,
4 saying that, because it is of a very specialized
5 nature, it does need to be encouraged.
6 2737 COMMISSIONER CARDOZO: Let me pose
7 one other conundrum to you -- and I don't mean to be
8 giving you a hard time, but these are the sort of
9 devils that we have to wrestle with.
10 2738 The more you give to any kind of
11 programming -- 150 per cent, people talk about 125,
12 200 -- the less there is overall; that means there is
13 less coming out of somewhere else. And one suggestion
14 is to do away with all this and just have 100 per cent,
15 period.
16 2739 What are your thoughts about that??
17 2740 MR. GUSTIN: The problem is, as was
18 brought out with TVO's presentation yesterday, we still
19 have to deal with Canadian content requirements; we
20 still have the requirements to satisfy and the
21 Commission and our licence requirements for Canadian
22 content.
23 2741 The problem is that these types of
24 programming, the specialized types of programming also
25 tend to be more expensive. I can buy sort of generic,
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1 off-the-rack programming that would get me my 100 per
2 cent Cancon for a lot less money than what I will have
3 to pay to meet these specific audience needs.
4 2742 What we are trying to find is a
5 mechanism, or what we are asking you to do -- and we
6 realize that this is a very difficult puzzle that you
7 have to put together to help us find a way to balance
8 the meeting Canadian content requirements and
9 addressing what we see as the needs our audience in the
10 context of the available resources that we have. We
11 have a finite amount of resources that we can throw at
12 these things.
13 2743 COMMISSIONER CARDOZO: I appreciate
14 that, but you haven't helped me in the conundrum at
15 all. Anyhow, I guess that's one we will continue to
16 wrestle with.
17 2744 In terms of reflecting Saskatchewan,
18 one of the distinctive aspects of the province is
19 surely the aboriginal population, the growing
20 aboriginal population, both on reserve and certainly in
21 cities more noticeably. How much does your programming
22 reflect the aboriginal population of the provinces
23 either on the programming side or the broadcast
24 network?
25 2745 MR. BENNING: On the broadcast side,
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1 we do have a number of aboriginal programs. I think
2 probably the best example is "Indigenous Circle". That
3 would be one.
4 2746 COMMISSIONER CARDOZO: Sorry, what
5 was it called?
6 2747 MR. BENNING: A program called
7 "Indigenous Circle". It is produced by quite a well-
8 known Saskatchewan aboriginal production company,
9 incidentally the one that is involved in the project
10 Big Bear. It is the same production house.
11 2748 COMMISSIONER CARDOZO: Okay.
12 2749 MR. BENNING: So that's part of it.
13 2750 Now, the second part of your question
14 I think refers to the classes. I forgot to mention
15 some of the credit classes that we carry into the
16 schools are originated from the Saskatchewan Indian
17 Federated College, a rather large college -- it is a
18 unique college affiliated with the University of
19 Regina. So there are credit classes originating from
20 that source as well.
21 2751 COMMISSIONER CARDOZO: Okay. Are you
22 aware that the CTCPF has, within its budget, set aside
23 I think it is $1 million for aboriginal producers? Do
24 you know if that's a source of production that you have
25 looked at or benefitted from?
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1 2752 MR. GUSTIN: With the model that we
2 are using right now, most of the material coming to us
3 is producer driven, so that we rely on the producers to
4 put together the funding package that we license into
5 the project. We have been working with the aboriginal
6 producers in the province looking at the projects they
7 bring to us, and we are encouraged to see that there
8 are more and more of them coming forward, both in terms
9 of numbers of producers and numbers of projects.
10 2753 By and large, we try to become
11 involved in as many of these as we are able to do with
12 our financial resources and which fit the mandate of
13 the network.
14 2754 COMMISSIONER CARDOZO: So it is an
15 issue that --
16 2755 MR. GUSTIN: Very much.
17 2756 COMMISSIONER CARDOZO: -- you keep an
18 eye on, or does it just happen --
19 2757 MR. GUSTIN: No. This is a very key
20 area for us. This is one of our priority areas. We
21 are trying to encourage producers to work in this area.
22 We are very aware that Saskatchewan has a growing
23 aboriginal population and that they particularly are
24 looking for their place in the television sun I guess
25 you could say because, if we look at the amount of
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1 programming that is on that is focused on aboriginal
2 peoples and their needs, it is disproportionately small
3 compared to the amount of programming available.
4 2758 COMMISSIONER CARDOZO: Thank you.
5 2759 Moving on to your recommendation
6 regarding dropped fees, I see what you said both in the
7 written and what you have said today. I just want to
8 clarify that we when you talk about drooped fees, you
9 are talking about the thing that we call subscriber
10 fees. Is that right?
11 2760 MR. BENNING: Yes.
12 2761 COMMISSIONER CARDOZO: If you don't
13 use the same terminology, we might just not understand.
14 They say we live in a bubble, but we try not to.
15 2762 Lastly, I wanted to ask about the
16 cost of programming, and maybe this is something you
17 can get back to us about if it is too detailed an
18 issue. You note that for you the cost of programming
19 can be $600 for non-Canadian up to $2,000 for Canadian-
20 made programming and up to 10,000 for Saskatchewan
21 made. This is on page 7 of your written presentation.
22 2763 Would you be able to give us a little
23 more detail on the costs involved in licensing a one-
24 hour informational programming?
25 2764 MR. GUSTIN: Certainly, Again, the
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1 problem with such an informational programming is I
2 don't think we could use the conventional model. If we
3 were to take, for example, a one-hour documentary --
4 and for the sake of this discussion we will use round
5 numbers; this is a hypothetical production, but say a
6 one-hour project with $100,000 budget. SCN's licence
7 may be up to $10,000 for that, which leaves the
8 producer the responsibility of finding the other 90 per
9 cent.
10 0935
11 2765 Hopefully, he will be able to access
12 the fund, be able to access telefilm and get other
13 broadcasters to participate. Probably other
14 broadcasters may, if they are fortunate, get a national
15 broadcaster to put in a first window licence, leaving
16 us in a second window position. In that fashion they
17 knit together that $100,000.
18 2766 If we are going to put together a one
19 hour regionally specific program, and let's say that it
20 is done in a more cost effective fashion or a lower
21 budget fashion so it becomes a $50,000 project, the
22 producer does not have the ability to access telefilm,
23 does not have the ability to access the fund, does not
24 have the ability to access out-of-province
25 broadcasters.
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1 2767 If we want to see this project
2 forward, we are looking at finding the entire $50,000.
3 This is the situation we are facing right now with this
4 education series that we are looking at. Basically, we
5 either have to find within our budget or find other
6 pockets to pick to put together this entire budget
7 within the province. We cannot go out-of-province to
8 look for the more traditional funding sources.
9 2768 COMMISSIONER CARDOZO: Do you have
10 recommendations for us, Mr. Gustin?
11 2769 MR. GUSTIN: This is where we think
12 that the regional information production fund is
13 crucial. We're not talking about huge amounts of
14 money. We are not looking for tens of millions of
15 dollars, but even, as we said in the oral presentation,
16 an ability to put another half a million dollars into
17 the kitty would make a tremendous difference in our
18 ability to address these issues.
19 2770 COMMISSIONER CARDOZO: Define
20 informational again. Is it what you call public
21 affairs programming?
22 2771 MR. GUSTIN: Public affairs, I
23 suppose to an extent it would be programming which is
24 not entertainment programming and it is programming
25 which is designed to promote an informed citizenry,
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1 that it allows them to have a context to participate
2 more fully in the daily lives in the provinces' daily
3 life.
4 2772 COMMISSIONER CARDOZO: So it is quite
5 different from current affairs. It wouldn't
6 necessarily be like a daily -- your counterpart in
7 Ontario, TVO, has "Studio 2", which is a current
8 affairs analysis type of thing.
9 2773 MR. GUSTIN: I think that "Studio 2"
10 might be on the edge of this sort of thing because
11 "Studio 2" is not news. We do not want to do news.
12 That came out earlier.
13 2774 It is the kind of programming that
14 provides the background to the news so that people can
15 understand where some of this information comes from
16 and make informed decisions, for example, in dealing
17 with the specific area, be it health, be it education,
18 be it whatever the subject area is.
19 2775 COMMISSIONER CARDOZO: When you are
20 talking about informational, it may or may not be
21 current inasmuch as the issues that are in the news
22 that week or that day.
23 2776 MR. GUSTIN: It could be.
24 2777 COMMISSIONER CARDOZO: But it may
25 not.
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1 2778 MR. GUSTIN: But it may not.
2 2779 COMMISSIONER CARDOZO: Right. Okay.
3 That covers my questions. Thanks very much.
4 2780 Thank you, Madam Chair.
5 2781 THE CHAIRPERSON: Commission
6 Pennefeather.
7 2782 COMMISSIONER PENNEFEATHER: Thank
8 you, Madam Chair.
9 2783 Good morning.
10 2784 I have one question. In your
11 presentation this morning on page 3, you refer to the
12 old Department of Supply and Services Fund. I assume
13 that's the non-theatrical fund at the time. A
14 precursor of the Canadian Independent Film and Video
15 Fund was an excellent example of a program with good
16 accessibility.
17 2785 The Canadian Independent Film and
18 Video Fund still exists. Are you using this fund? Is
19 it an example of accessibility?
20 2786 MR. GUSTIN: That fund has not been
21 terribly successful for Saskatchewan producers, the
22 Canadian Independent Film and Video Fund. Saskatchewan
23 producers have not had a great deal of success in
24 accessing that fund.
25 2787 COMMISSIONER PENNEFEATHER: Would you
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1 elaborate just a bit. One of the reasons I'm asking
2 also is some of the definitional questions that
3 Commissioner Cardozo was asking are of concern to me in
4 terms of the needs and the kind of programming that we
5 are talking about.
6 2788 You yourselves have proposed a new
7 fund. What are the criteria that make a fund work
8 then?
9 2789 MR. GUSTIN: I think in terms of this
10 question, the regional accessibility, I think that's
11 the key issue, that the new fund or the Canadian
12 Independent Film and Video Fund seems to have lost that
13 regional specificity.
14 2790 COMMISSIONER PENNEFEATHER: Okay.
15 The definition of its mandate is very much directed
16 towards the kinds of programming you are talking about
17 and your statement that there is little funding for
18 that programming makes it, I think, an important issue.
19 So it's a question of process then.
20 2791 MR. GUSTIN: Yes. I can't speak to a
21 lot of the specifics of how that fund operates, so yes.
22 2792 COMMISSIONER PENNEFEATHER: Thank
23 you.
24 2793 Thank you, Madam Chair.
25 2794 MR. BENNING: Just one final comment.
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1 If you look at the most recent report from that fund,
2 there's a big blank in the middle of the map of Canada
3 in terms of there is nothing going in from that fund.
4 Zero.
5 2795 THE CHAIRPERSON: Thank you,
6 gentlemen. Thank you for coming from so far to share
7 your concerns. We hope you have a good trip back.
8 2796 MR. BENNING: Thank you very much,
9 Madam Chair. Thank you.
10 2797 THE CHAIRPERSON: Madam Secretary,
11 would you invite the next participant, please.
12 2798 MS BÉNARD: Thank you, Madam Chair.
13 2799 The next presentation will be by
14 ACCESS, Learning and Skills Television of Alberta
15 Limited. I would invite Mr. Peter Palframan and Mr.
16 Ross Mayot to please come forward.
17 PRESENTATION / PRÉSENTATION
18 2800 THE CHAIRPERSON: Good morning,
19 gentlemen.
20 2801 MR. MAYOT: Good morning.
21 2802 MR. PALFRAMAN: Good morning, Madam
22 Chair, Commissioners, CRTC staff, ladies and gentlemen.
23 2803 My name is Peter Palframan and I am
24 the Vice-President of Finance and Administration for
25 ACCESS and Canadian Learning Television. With me today
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1 is Ross Mayot, our Vice-President of Development for
2 ACCESS and Canadian Learning Television.
3 Unfortunately, Dr. Ron Keast, the President of ACCESS
4 and CLT, cannot be with us today.
5 2804 The mission for both ACCESS and CLT
6 is straightforward and clear, to provide Canadians with
7 educational programming and opportunities that support
8 their lifelong learning needs and interests.
9 Affordable access to educational resources, especially
10 distance learning resources, is a key goal for Canada
11 in the new knowledge-based economy.
12 2805 We are participating in this
13 proceeding, along with our colleagues from ATEC, to
14 urge the CRTC to ensure that educational television is
15 taken into consideration.
16 2806 Educational programming makes an
17 important contribution to the objectives of the
18 Broadcasting Act and to millions of Canadians of all
19 ages who rely on educational television to enrich their
20 lives and support their learning needs. It is also
21 increasingly important for small and medium sized
22 independent production companies who rely heavily on
23 educational television for the production and
24 exhibition of their work.
25 2807 Since our written submission covers
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1 our responses to the key questions raised by the
2 Commission in the Public Notice for this hearing, we
3 would like to take our brief time today to focus on two
4 issues of particular importance, both relating to the
5 marginalization of educational television; firstly in
6 terms of access to programming funds and, secondly, in
7 terms of cable access.
8 2808 MR. MAYOT: The first issue deals
9 with the fact that the existing regulatory policies
10 concerning Canadian programming have come to favour
11 large, vertically integrated network operations and
12 production houses specializing in the production and
13 exhibition of dramatic adult entertainment. As a
14 result, educational broadcasters and smaller
15 independent producers are being marginalized within the
16 policy and regulatory framework.
17 2809 With the changes in the delivery of
18 education, this issue has been compounded and has a
19 great impact on educational television. Technology,
20 competition and changing interests in lifestyles are
21 reshaping the delivery of education, especially higher
22 education and lifelong learning.
23 2810 Educators and educational
24 administrators realize that courses have to be marketed
25 and offered in ways that are more flexible and suited
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1 to lifestyles and needs of contemporary learners. One
2 of the best ways for educators to accomplish this is to
3 make better use of television to market, promote and
4 deliver their courses.
5 2811 ACCESS is helping them do that now by
6 working in partnership with educators, government
7 officials, independent producers and others to create
8 innovative and flexible programs for institutions and
9 learners and to promote lifelong learning.
10 2812 New series such as "Death: A
11 Personal Understanding", "21st Century Business",
12 "Building a Nation", "Trouble in Mind" and "Judaism: A
13 Quest for Meaning", produced by independent producers
14 in co-operation with ACCESS, illustrate how high
15 quality television programs, designed and
16 contextualized to support university and college credit
17 courses, play a key role in the new learning
18 environment. But these productions have to be produced
19 and financed in the new television environment where
20 there is limited funding for our documentary and
21 non-fiction formats.
22 0945
23 2813 Each of these productions, and more
24 like them in development, requires financing from other
25 broadcasters to be completed. While this is positive,
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1 in that it increases the audiences for these programs,
2 it does illustrate how our educational objectives are
3 depending on the programming interests of other
4 broadcasters. For these reasons we strongly believe it
5 is necessary to enhance the policies for the production
6 and exhibition of documentaries and non-fiction series
7 and we recommend that:
8 2814 First, educational programming,
9 including instructional and how-to programs, created by
10 independent producers and licensed by educational
11 broadcasters, should be eligible to trigger CTF
12 funding.
13 2815 Secondly, the CRTC should provide at
14 least a 125 per cent credit for 10/10 documentary
15 programming broadcast on educational television
16 services.
17 2816 MR. PALFRAMAN: Our second issues
18 relates to the marginalization of education in terms of
19 access to cable carriage and specifically to our
20 experience over the past two years with Canadian
21 Learning Television. It has given us real concern
22 about the ease with which the spirit and objectives of
23 the CRTC's Priority Carriage, Tiering and Linkage rules
24 and the objectives of the Broadcasting Act can be
25 undermined. This relates to the fact that, since
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1 September 1996, Canadian Learning Television, the first
2 and only Canada-wide educational television service,
3 has been forced to the sidelines, waiting for a digital
4 roll-out, which itself has been place don the back
5 burner by most cable operators, while upwards of eight
6 non-Canadian and exemption or "informercial" services,
7 that nobody asked for and almost nobody watches, have
8 been given scarce analog channels that reach millions
9 of Canadian homes.
10 2817 Despite its wide-ranging support from
11 educators, public officials, business and community
12 leaders and despite independent research that indicates
13 its appeal to Canadians cost to coast, CLT continues to
14 be shunted aside in favour of these non-Canadian and
15 exempt services.
16 2818 CLT now faces the impossible prospect
17 of being carried next fall in a limited digital roll-
18 out that has the maximum potential to reach 2 or 3 per
19 cent of cabled Canadian homes or, as part of a slowly
20 dying analog pay TV tier whose declining penetration
21 may reach 10 per cent of cabled homes. Those are the
22 options we are now being offered by the largest cable
23 MSOs. These options are both unfair and unacceptable.
24 2819 We appreciate the context and
25 environment in 1996, in which CLT and others were
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1 licensed as so-called "digital" services. But that
2 context only existed because the Commission was misled
3 about channel capacity. That fact was never more
4 evident than last October when cable rolled out a new
5 analog tier of up to 16 new specialty services, six of
6 them non-Canadian, and added more exempt services. So
7 much for capacity constraints. But then having decided
8 there was actually capacity for these new services,
9 rather than taking advantage of the opportunity to
10 accommodate all of the licensed Canadian services,
11 which would have included CLT, a learning service that
12 would help people to upgrade their skills, get jobs or
13 get a university degree, cable decided to add more
14 fringe American services as part of the new package.
15 2820 Fringe services that were actually on
16 the eligible list of foreign services primarily because
17 cable had asked for them to be added to help with the
18 roll-out of digital, not for analog carriage.
19 2821 And now, less than a year after the
20 introduction of the package, it's interesting to note
21 that it's the Canadian services that are proving to be
22 the most popular in the new tier by large margins. The
23 BBM data appended to this presentation illustrates our
24 point. The data also reflect the viewership and
25 importance of ACCESS and TVO in their respective
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1 markets, providing an indication of what CLT could
2 accomplish nationally.
3 2822 Madam Chair, you forewarned of these
4 and other problems in your thoughtful and forward-
5 looking dissenting opinion in CRTC 1996-600.
6 2823 MR. MAYOT: Given the investment by
7 Canadian licensees of hundreds of thousands of dollars
8 in meeting the stringent and competitive test of a
9 licensing process and the commitments made by them that
10 are significant to the Broadcasting Act, and to
11 programming policies, they should be entitled to a
12 greater sense of fair play.
13 2824 The CRTC's priority carriage, and the
14 tiering and linkage requirements do not ensure that at
15 present. Although the current moratorium on the
16 authorization and distribution of any new foreign
17 services is a helpful measure, it's not enough.
18 2825 Quite simply, it does nothing to help
19 the objectives of this procedure when licensed Canadian
20 services are treated in this way. Particularly in the
21 case of education, whose importance is singled out in
22 the Broadcasting Act. And yet, the only nationally
23 available service in the education gene is an American
24 one. What a sad reflection this is when we have a
25 wide-supported, quality Canadian service sitting on the
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1 shelf with an innovative programming plan that is all
2 set to launch. Therefore, we urge the CRTC to use its
3 full regulatory and supervisory clout to address this
4 situation without further delay.
5 2826 Madam Chair, if the programming
6 policies and enabling regulations do not effectively
7 support educational broadcasters and the distinct
8 programming that they especially contribute to our
9 broadcasting system, educational television will be
10 even further marginalized and another opportunity will
11 have been missed for our broadcasting system to make a
12 meaningful support to the pressing educational
13 objectives and needs of Canadians.
14 2827 That concludes our presentation. We
15 would welcome your comments.
16 2828 THE CHAIRPERSON: Thank you, Mr.
17 Palframan and Mr. Mayot.
18 2829 Commissioner McKendry, please.
19 2830 COMMISSIONER McKENDRY: Thank you,
20 Madam Chair.
21 2831 Good morning. I would like to ask
22 you a few questions to begin with about your oral brief
23 that you have just presented to us. I have taken a
24 look at the schedules and charts that you have given us
25 at the end of the brief. On page 2 you have noted that
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1 educational broadcasters are being marginalized within
2 the policy and regulatory framework, yet I take it the
3 point of the charts at the back are to show that in
4 fact you are doing well. This seems to demonstrate
5 that you are quite successfully attracting viewers in
6 relation to services that you compete with. My
7 question is: How do you reconcile the view that you
8 are being marginalized with the apparent success of
9 ACCESS in relation to competing services?
10 2832 MR. PALFRAMAN: Commissioner, let me
11 first respond to that and I know that Ross will want to
12 add to it.
13 2833 I think it is a credit to all of the
14 educational broadcasters that they do get the audiences
15 and achieve the audiences that they do. One of the
16 reasons is that we are a priority carriage service on
17 basic. That means that we are accessible to the
18 largest number of viewers in cabled and over-the-air
19 broadcast, so that's one of the reasons. But I think
20 the other is that it indicates how strong the demand is
21 from people for educational television.
22 2834 What it doesn't change is the fact
23 that we are being marginalized in terms of the extent
24 to which we can access the programming funds that are
25 available to all the other conventional broadcasters.
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1 I guess what we have had to do is get really creative
2 about how we finance some of the productions that are
3 involved in.
4 2835 The growth of specialty services has
5 been a help to us in fact. It has meant that there are
6 other broadcasters that we can work with in terms of
7 financing and sometimes it means that we don't have the
8 first window for that programming, but it means that we
9 do carry that programming. The first window is not a
10 big issue for us, as I think somebody said earlier,
11 from ATEC yesterday, the first window often is just a
12 promotion for a much wider audience subsequently.
13 2836 So, we have had to be creative to
14 make sure that we have retained the viewers that
15 educational television has built up, but again as far
16 as I am concerned it just indicates how strong the
17 demand is for educational television and how important
18 it is. It doesn't change the fact that it is very
19 difficult for us to access some of the production funds
20 that are available to others.
21 2837 MR. MAYOT: I think that is entirely
22 true, but I think in fairness if you look at the chart
23 we have chosen us to reflect the capacity of
24 educational programming to draw viewership in relation
25 to other specialty services.
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1 2838 One could extend this chart upward
2 from where it is now to include the conventional
3 broadcast services and the networks and the gap between
4 those audiences and where we are would be very, very
5 large, as you know.
6 2839 What we are saying is that in the
7 context of this kind of procedure, where you are
8 looking at the overall system and looking at ways in
9 which to enhance programming opportunities for all of
10 the services, including the ones that aren't on this
11 group, we don't want to be left down in this tiny
12 little group that is an aggregate, draws meaningful and
13 important audiences, as an aggregate.
14 2840 We certainly don't want to see a
15 split between our sector of the broadcasting system,
16 educational broadcaster specialty services, and the
17 networks and the specialty. Our point is there is a
18 gap now. There is a bias in favour of networks and
19 large production and drama and that is only going to
20 get wider and these numbers will look even smaller if
21 we are not part of the programming policy changes and
22 helpful ones that you are contemplating.
23 2841 COMMISSIONER McKENDRY: Thank you.
24 2842 Just looking at page 4 and in turn
25 with reference to the funding, you note that at this
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1 point you are dependent or you are reliant on other
2 broadcasters to assist in the funding of programs and
3 that you would prefer I guess to be able to access the
4 fund directly yourself.
5 2843 So just to make sure I understand the
6 issue, the issue isn't really whether or not the money
7 is available to you today. It's where it is available.
8 You are getting what you need, but you have to go into
9 partnership with other broadcasters?
10 2844 MR. MAYOT: I don't think we have
11 suggested that we want to access the fund directly.
12 Our commitment upon licensing of ACCESS was to use
13 independent production as fully as possible. There is
14 very little that is not done through independents. But
15 as our educational colleagues yesterday and today have
16 pointed out, our ability to provide licence fees that
17 trigger the fund is a large part of the problem.
18 2845 We work with a lot of independent
19 producers who come to us, want to do the kinds of work
20 that we do, but know that in many cases, both because
21 of genre and because of financing we can't be that
22 trigger mechanism for them, so they have to go
23 elsewhere.
24 2846 We have not complained about that.
25 We think that's a healthy thing. We don't mind at all,
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1 but it does mean that we are not the authors of our own
2 fate in terms of the kind of programming we want to do.
3 We are limited to certain kinds of programming. It's
4 all non-formal and there is a limit in terms of the
5 funding available for the kinds of programming.
6 2847 MR. PALFRAMAN: Commissioner, I want
7 to be really clear about that. I think Ross expressed
8 it up front, that the issue is not that we have to be
9 able to access it directly ourselves in our own name.
10 The key is that that genre, educational television, has
11 to be available for the independent production
12 community to be able to access it. That's the real
13 key. It is not a question of us having equity in it.
14 That might be nice, but it's not important to us.
15 2848 As Ross said, the key is we work with
16 those independent producers and that's an important
17 community to us, but if they can't access the fund,
18 then it is not of much help to us.
19 2849 COMMISSIONER McKENDRY: Thank you.
20 2850 I wanted to ask you a question about
21 on your written submission to us. Earlier you noted on
22 page 1 of a growing appreciation of the regulatory role
23 of market forces. I take it from your comments today
24 you don't perceive that the way the cable industry has
25 packaged the new specialty services as market forces at
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1 work?
2 2851 MR. PALFRAMAN: I am not quite sure I
3 understand your question, but just --
4 2852 COMMISSIONER McKENDRY: To make
5 myself more clear, I guess one possible argument is
6 that the cable operators packaged American services
7 with Canadian services for marketing reasons, in order
8 to give more appeal to these new tiers. I take it you
9 don't agree with that view of the application of market
10 forces, at least in that particular case or you
11 disagree that it is market forces at work?
12 2853 MR. PALFRAMAN: Marketing has been
13 important all along the way. I think that cable have
14 always made the argument that, I think as Mr. Beatty
15 said yesterday, if you put on a Canadian services you
16 put on another American one. I think that probably was
17 true, but I don't think it is any more.
18 2854 I think that over the last five or
19 eight years we have seen how successful Canadian
20 specialty services have been and I think there has been
21 a very wide viewer acceptance of the Canadian specialty
22 services. I think that the idea that you have to have
23 an American service every time you put on a Canadian
24 one just isn't true any more. I think that in fact
25 some of the data that we submitted with our oral today
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1 certainly supports that.
2 2855 I think it was a terrific opportunity
3 that cable had last October when they brought out, in
4 the case of Rogers, 16 new services, a terrific
5 opportunity to recognize the success of the Canadian
6 specialty services and that opportunity was lost.
7 2856 So, yes, I agree with you. I think
8 that marketing or it's just to speak to the point we
9 made in our written submission. Market forces are
10 important, but the marketing has changed and I don't
11 think cable have recognized that.
12 2857 MR. MAYOT: Could I just add that in
13 my view it hasn't been market force that has put us in
14 the position we are in. If it were, then we wouldn't
15 have anything to complain about.
16 2858 In our view, the cable industry has
17 used a regulatory loophole really as a means of
18 ensuring that market forces don't come into play
19 entirely. The fact that there is a suspension of the
20 access rules has been the central issue in why we are
21 not on the air right now. It is not anything to do
22 with market or audience or anything. The playing field
23 in this entire cliché is not balanced because there of
24 the suspension of the access rules.
25 2859 So, it's a regulatory matter that has
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1 come into play in the market. It is not simply a
2 matter of the market.
3 2860 COMMISSIONER McKENDRY: On pages 4
4 and 8 of your written submission you recommended
5 lowering the 60 per cent Canadian content quota. I
6 think you suggest that it should be complemented with
7 additional measures, similar to those established for
8 the specialty and pay services. I am wondering if you
9 can elaborate on those additional measures that you
10 think would be appropriate?
11 2861 MR. MAYOT: I think the concept and I
12 think it appears to be the one that the Commission is
13 struggling to find is quotas and arithmetic around
14 hours of play doesn't seem to be as applicable or as
15 desirable for anybody any more, so the idea of a quota
16 system of content is not properly or fully addressing
17 the issue of quality and the kind of programming that
18 everybody wants to see in our system.
19 2862 So our view, in terms of trying to be
20 helpful, both in the spirit of looking for alternatives
21 and to be practical is, well, don't make that the
22 measure. Don't make 60 per cent the measure of whether
23 a broadcaster of any kind is doing their job. Make a
24 measure of the kinds of things that could stimulate
25 them to do more both in terms of quality and in terms
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1 of quantity.
2 2863 If that includes dropping the overall
3 requirement, but providing incentives that could
4 include -- and this is just one example -- that
5 broadcasters that actually do generate more hours
6 against a previous bench mark, let's say of their
7 schedule last year, in terms of dollars spent or
8 exhibit, maybe they can bank some of that.
9 2864 Again, in the spirit of trying to
10 provide flexibility and incentive to do new things,
11 maybe it is time to look at ways in which you can -- if
12 you exceed performance measures, you can bank some of
13 that. You can simply be a little more flexible in
14 terms of the way you broadcast your schedule, rather
15 than get caught up into the 60 per cent.
16 2865 Really, the spirit of let's find and
17 let's encourage new ways to allow broadcasters to
18 produce and exhibit more programming of a higher
19 quality was what we were trying to get at.
20 2866 COMMISSIONER McKENDRY: How long
21 would you be able to bank it for? Would you have to
22 take it in in the following year?
23 2867 MR. MAYOT: Certainly I don't think
24 we have thought that through, but maybe a calendar year
25 might be the threshold.
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1 2868 COMMISSIONER McKENDRY: On page 6 of
2 the written submission you noted that the USA
3 represents the greatest market for the kinds of
4 programming that we produce or licence from independent
5 producers. What are the problems that are standing in
6 the way now of taking advantage of that market to the
7 extent that you would like to be able to take advantage
8 of it?
9 2869 MR. MAYOT: In a couple of examples
10 we do a lot of work with a company called Sleeping
11 Giant Productions, who have made their own commitment
12 to educational programming, formal educational
13 programming.
14 1005
15 2870 There are a number of like-minded
16 independent producers and broadcasters in the United
17 States in the public broadcasting system, but
18 increasingly in the private side, the Knowledge TV
19 Jones Network people. There have been two or three
20 projects that I am aware of where deals between all of
21 us have not been able to be consummated because of the
22 Canadian content rules and who accesses the fund. I'm
23 afraid I can't provide the specifics.
24 2871 I'm not acquainted enough with what
25 the specific problems were, but there were a number of
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1 impediments just in terms of cooperation between
2 producers in Canada and producers in the United States
3 that didn't fulfil the requirements of CTF funding and
4 Canadian content, the point system, to allow otherwise
5 great educational products that would play widely in
6 the United States and in Canada, put Canadian
7 independent producers to work, give Canadian
8 broadcasters interesting product to use. It just
9 couldn't be done because of the current point system
10 and the rules on accessing the fund.
11 2872 COMMISSIONER McKENDRY: Thanks. I
12 would like to end up by coming back to a point we
13 discussed a little bit earlier and you clarified for me
14 about your interest in -- as I understand it, you are
15 not proposing to directly access the production funds
16 and I am wondering if you agree or disagree with the
17 SCN proposal that there be a dedicated production fund
18 for regional information programming. I assume if such
19 a fund was created, then that would be something that
20 would be for the broadcasters to have direct access to.
21 2873 MR. PALFRAMAN: We certainly support
22 that idea. We, from the perspective of ACCESS, don't
23 attach as much importance to it, but we think it is a
24 good idea and if such a fund existed, we would access
25 it.
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1 2874 In terms of regional programming, we
2 do a daily one-hour live show that is broken into two
3 parts. One focuses on learning and jobs and the other
4 focuses on a help hot line that deals with a wide range
5 of issues. But that's live and it's produced in our
6 Edmonton studio and it then gets repeated twice later
7 that day and then once the subsequent day. So, we have
8 three hours a day of programming that focuses on
9 regional matters and we put a lot of our own production
10 money into that.
11 2875 So, we do deal on a daily basis with
12 regional issues and those have become very important
13 productions and programs within Alberta. We think that
14 regional programming is important, but what's more
15 important to us is having a national audience for most
16 of the programming that we do. So, when we get into
17 co-productions and joint ventures, we try as much as
18 possible to incorporate other national broadcasters, as
19 I said earlier. So, that's important. I think a
20 regional fund would be important and if such a fund
21 existed, I know we would be able to put it to very good
22 use.
23 2876 COMMISSIONER McKENDRY: Thank you
24 very much. Those are the questions I have for you.
25 2877 Thank you, Madam Chair.
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1 2878 THE CHAIRPERSON: If I may ask, with
2 regard to lowering the 60 per cent quota, you probably
3 noticed that the CBC, if I recall, has even suggested
4 it was no longer necessary. Do you see that as a quid
5 pro quo for more focused requirements during peak hours
6 or simply for you it's a question of flexibility? You
7 lower it and then if someone increases it, then as an
8 incentive they can bank the increase.
9 2879 You are looking at lowering it to 40,
10 35. I don't quite understand what you intend because I
11 didn't hear you or read that you suggested there be
12 requirements in peak hours. Have you recommended as a
13 quid pro quo simply lowering the 60 per cent and you
14 keep the 50 after 6:00 o'clock or is it the daytime
15 period you feel there should be more flexibility? To a
16 large extent, I suppose, some of your programming --
17 there would be an incentive to place it in --
18 2880 MR. MAYOT: Precisely.
19 2881 THE CHAIRPERSON: But you would want
20 that for all broadcasters or just for yourselves, for
21 educational broadcasters?
22 2882 MR. MAYOT: Again in the spirit of
23 trying to advance ideas would provide some flexibility,
24 get away from a quota system which has limitations that
25 I think we all acknowledge. Let's find some new ways
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1 so that performance gives you some flexibility in terms
2 of quota.
3 2883 THE CHAIRPERSON: And would you
4 measure performance like the CAB, according to
5 viewership?
6 2884 MR. MAYOT: No, not entirely.
7 2885 THE CHAIRPERSON: How would you
8 measure it?
9 2886 MR. MAYOT: Well, I think we would --
10 2887 THE CHAIRPERSON: By how Canadian
11 programming was so there was in the under-represented
12 categories that type of measure?
13 2888 MR. MAYOT: Certainly. If there was
14 an increase on 10 out of 10 productions in any of the
15 genres, maybe that's a way to encourage quality and,
16 ostensibly, viewership does flow from that.
17 2889 THE CHAIRPERSON: It may create some
18 flexibility, but it will sure require some micro-
19 management of the system. If you were to actually
20 monitor performance, it would become as when we talk
21 about bringing forward and so on -- it reminds me of
22 the tax system when I lost a lot of money one year. It
23 would require some serious management of performance.
24 2890 MR. MAYOT: I suppose and, to be
25 frank, we haven't looked at the administrative
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1 implications of that.
2 2891 THE CHAIRPERSON: But the spirit
3 would be to have a lower requirement and find some way
4 of incenting by promising some relief if something is
5 done very well.
6 2892 MR. MAYOT: I think so, yes.
7 2893 THE CHAIRPERSON: And the relief
8 would be less Canadian programming in daytime.
9 2894 MR. MAYOT: Well, it could be.
10 Perhaps we are being optimistic or just looking at the
11 world from our perspective on what we want to do, but
12 our argument would be that lowering the quota doesn't
13 diminish quality viewership, numbers of projects, money
14 spent. By definition, none of those are the
15 implications.
16 2895 THE CHAIRPERSON: So, why lower it?
17 2896 MR. MAYOT: Because the quota now,
18 conversely, doesn't contribute to any of those things.
19 It doesn't guarantee more money spent -- the quota just
20 becomes an arithmetical requirement.
21 2897 THE CHAIRPERSON: I understand what
22 your aim is. How one achieves that without losing in
23 the process as to what our concerns are is perhaps
24 another matter.
25 2898 We appreciate your comments and we
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1 certainly hope you had a nice evening last night. I
2 don't think you expected to be in Ottawa this long. We
3 thank you for your cooperation and we hope you have a
4 good trip back to where the sun really shines. Thank
5 you.
6 1015
7 2899 Madam Secretary, voulez-vous s'il
8 vous plaît inviter les intervenants suivants.
9 2900 Mme BÉNARD: Merci, Madame la
10 Présidente.
11 2901 La prochaine présentation sera celle
12 de Télé-Québec.
13 2902 LA PRÉSIDENTE: Bonjour, messieurs.
14 Allez-y quand vous êtes prêts.
15 PRÉSENTATION / PRESENTATION
16 2903 M. INCHAUSPÉ: Madame la Présidente,
17 Mesdames et Messieurs les Conseillers, je me présente
18 tout d'abord; je suis Paul Inchauspé. Je suis
19 président du conseil d'administration de Télé-Québec.
20 Je remplace ici le président-directeur général Robert
21 Normand, qui a été empêché et qui m'a demandé de
22 l'excuser auprès de vous.
23 2904 Je suis accompagné de Mario Clément,
24 qui est directeur général de la Programmation; de Denis
25 Bélisle, directeur général des Affaires juridiques et
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1 secrétaire général; de Jacques Lagacé, qui est
2 directeur du Développement institutionnel; et, en
3 arrière, deux personnes qui font partie du service de
4 Recherche et Planification, Pierre Daigneault, qui est
5 le chef de service, et Gérald Bourbeau, qui est un
6 chercheur. Alors ces personnes se joindront à moi,
7 vous le comprendrez facilement, pour répondre aux
8 questions que le Conseil voudra bien nous adresser.
9 2905 Nous tenons à remercier tout d'abord
10 le Conseil de donner à Télé-Québec l'occasion
11 d'exprimer ses commentaires lors de ces audiences
12 majeures pour l'industrie de la radiodiffusion
13 canadienne et québécoise. Nous disons "audiences
14 majeures" parce que nous comprenons bien la
15 préoccupation qui est la vôtre.
16 2906 Les pouvoirs qui vous sont confiés
17 vous donnent un rôle de régulation déterminant dans
18 l'offre télévisuelle. Vos interventions passées ont
19 déjà eu des effets structurants sur la diversification
20 de cette offre. Notamment, vous avez rendu possible
21 l'émergence et la consolidation de chaînes privées et
22 le développement de la production indépendante, ce qui
23 a été bénéfique.
24 2907 Mais vous êtes devant une réalité
25 nouvelle. L'expansion sans précédent de l'industrie
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1 culturelle d'une part, celle des technologies de
2 télécommunication d'autre part, et l'attraction
3 qu'exercent sur de nouveaux acteurs entreprenants les
4 développements de ces deux secteurs moteurs, tout cela
5 transforme la réalité sur laquelle vous devez exercer
6 vos pouvoirs. Et, légitimement, vous vous demandez si
7 les règles que vous avez établies dans un autre
8 contexte sont encore appropriées, si elles ne freinent
9 pas les développements et ne devraient pas être
10 supprimées, comme d'ailleurs vous le recommanderont
11 probablement certains, ou s'il ne vous faut pas à tout
12 le moins concevoir un nouveau cadre d'intervention,
13 plus souple sur certains points, plus contraignant sur
14 d'autres, pour mieux assurer la régulation que commande
15 la nouvelle réalité.
16 2908 Alors nous comprenons cette
17 préoccupation et c'est pour y répondre que nous vous
18 soumettons quelques éléments dont il vous faudra aussi,
19 nous semble-t-il, tenir compte.
20 2909 Notre champ d'intervention est celui
21 de la culture et de l'éducation, ce qui nous classe
22 dans une position favorisant la diffusion d'émissions
23 canadiennes sous-représentées. À cause de cela,
24 pensons-nous, notre voix doit être non seulement
25 écoutée, mais entendue. Car ce qui justifie notre
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1 propos, c'est notre mandat lui-même. Nous ne sommes
2 pas simplement un diffuseur; nous devons réaliser une
3 mission éducative et culturelle au service des
4 Québécois, et si nous intervenons devant vous sur deux
5 points, c'est pour que les conditions de réalisation de
6 ce mandat, mais aussi celles de mandats analogues
7 d'autres chaînes, soient non seulement préservées mais
8 aussi renforcées.
9 2910 Ces deux points concernent ce qui
10 nous préoccupe et sont l'impact que peuvent avoir sur
11 la programmation une libéralisation complète de l'accès
12 aux chaînes spécialisées et le sous-financement de
13 certaines catégories de produits télévisuels. Nous
14 dirons un mot sur chacune de ces deux préoccupations.
15 2911 La multiplication des canaux
16 spécialisés est déjà une réalité. La télévision
17 numérique décuplera les possibilité d'expansion en ce
18 domaine. Les forces du marché poussent à la
19 libéralisation. Il devrait en résulter, selon la
20 théorie même du marché, plus de qualité puisqu'il y
21 aura plus de concurrence, plus de diversité puisqu'il y
22 aura plus de joueurs, plus de production puisqu'il y
23 aura plus de diffuseurs. Qui peut être contre cela?
24 Mais est-ce que c'est cela qui adviendra?
25 2912 Nous sommes portés à en douter, du
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1 moins lorsque nous observons dans le marché québécois
2 les effets produits par la multiplication des acteurs.
3 Ce marché étant petit, les effets s'y manifestent plus
4 vite: cette réalité a donc une valeur exemplaire. Or,
5 que constate-t-on? J'indique ici sommairement ces
6 effets et, à la période de questions, ceux qui
7 m'accompagnent pourront, si vous le désirez, illustrer
8 mes propos.
9 2913 Alors deux constats sont déjà
10 évidents. Le premier, c'est qu'en multipliant les
11 acteurs, les sources de financement sont contraintes à
12 se répartir entre des demandeurs de plus en plus
13 nombreux. Une telle dispersion entraîne une dilution
14 et produira, croyons-nous, à terme, ou risque de
15 produire à terme une perte de qualité. Mais, faute de
16 masse critique suffisante pour chaque acteur, ce type
17 de situation risque davantage d'entraîner une réduction
18 quantitative de produits canadiens de qualité et donc
19 la cascade des effets suivants: augmentation
20 d'acquisitions étrangères et, pour respecter les
21 exigences de contenus canadiens, diffusion du même
22 produit sur plusieurs chaînes. Mais alors où seront la
23 qualité, la diversité, l'augmentation de la production
24 canadienne?
25 2914 Le deuxième constat, c'est qu'en
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1 multipliant les acteurs on produit les conditions
2 d'émergence de concentrations de plus en plus
3 puissantes qui rendent difficile, sinon impossible,
4 l'existence de petits acteurs. Voyons déjà ce qui se
5 passe. Exception faite des canaux sportifs et
6 météorologiques, les canaux spécialisés au Québec
7 appartiennent à trois entreprises. Incidemment, ces
8 entreprises sont à l'origine de la majorité des 21
9 nouvelles demandes de canaux spécialisés. Entraînée
10 par ce mouvement de concentration, même une télévision
11 généraliste publique comme Radio-Canada dérive et
12 cherche elle aussi à être propriétaire de canaux
13 spécialisés.
14 2915 Les poussées vers la concentration et
15 même l'intégration verticale, nous semble-t-il, sont
16 donc déjà manifestes. C'est là, d'ailleurs, la loi non
17 écrite de la multiplication. Les fruits qui en
18 résulteront sont évidents: diffusion du même produit
19 sur plusieurs chaînes, surtout quand les canaux
20 spécialisés sont liés à un diffuseur conventionnel
21 généraliste, achats massifs de produits servant à
22 alimenter l'ensemble des services d'un même
23 propriétaire, et donc limitation de l'accès des autres
24 chaînes à ces produits; possibilité d'une offre globale
25 de temps publicitaire pour l'ensemble des services
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1 spécialisés dont on est propriétaire et donc
2 possibilité de casser les prix, réduction du
3 partenariat entre chaînes généralistes puisque les
4 nouvelles règles favorisent plus la concentration et
5 non la concertation. Mais alors où sera la diversité,
6 et comment les petits joueurs pourront-ils jouer dans
7 ce nouvel équilibre?
8 2916 Alors nous semble-t-il que la réalité
9 que vous avez à affronter n'est pas celle de savoir
10 s'il faut ou non ouvrir le marché des canaux
11 spécialisés, c'est sûr, mais de savoir quels mécanismes
12 de régulation vous devez mettre en oeuvre pour que
13 cette ouverture ne produise pas les effets nocifs déjà
14 constatés. Nous ne pouvons, quant à nous, évidemment,
15 donner une réponse exhaustive à cette question, mais
16 c'est pour contribuer à cette tâche que nous avons
17 formulé des recommandations sur:
18 2917 - la nécessité de la réglementation
19 du contenu canadien du système de radiodiffusion;
20 2918 - le maintien des engagements des
21 radiodiffuseurs dans leur condition de licence et sur
22 le recours à des modes d'examen du respect de ces
23 engagements;
24 2919 - sur la nécessité de s'assurer d'une
25 réelle complémentarité de la programmation des canaux
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1 spécialisés par rapport à celle des chaînes
2 généralistes; et
3 2920 - des correctifs qui sont
4 susceptibles de limiter les effets nocifs de la
5 concentration, spécialement pour assurer une
6 compétition équitable dans la quête de revenus
7 publicitaires et l'accès aux différents produits.
8 2921 Je voudrais dire maintenant un mot
9 sur la deuxième question qui nous préoccupe et qui
10 concerne le sous-financement de certaines catégories de
11 produits audio-visuels.
12 2922 Les règles de répartition des fonds,
13 nous semble-t-il, déjà établies doivent être
14 réévaluées. Ainsi, nous estimons que la catégorie
15 dramatiques ne devrait inclure que les dramatiques
16 lourdes et non les téléromans, déjà rentables dans le
17 marché francophone.
18 2923 Mais nous sommes spécialement
19 préoccupés par les catégories documentaires, arts de la
20 scène, émissions pour enfants, auxquelles nous
21 ajouterions une préoccupation pour des émissions de
22 formation continue grand public. Ces catégories ont
23 une grande valeur éducative et culturelle à cause de
24 leur possibilité d'ancrage et d'approfondissement dans
25 la réalité nationale ou régionale et à cause aussi de
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1 leur impact sur le développement cognitif, affectif,
2 social et culturel des téléspectateurs, jeunes ou
3 adultes. Et nous savons que c'est l'enracinement dans
4 le milieu immédiat qui est la condition d'existence de
5 télévisions comme la nôtre.
6 2924 Or, nous sommes bien placés pour vous
7 dire les conséquences du sous-financement de ces
8 catégories. Le directeur général de la Programmation
9 pourrait vous parler abondamment de ce qui a été vécu
10 cette année à Télé-Québec: aucun financement du Fonds
11 de production des câblodistributeurs pour nos
12 émissions jeunesse; financement réduit pour les
13 documentaires et les arts de la scène parce que le
14 Fonds de télévision et de câblodistribution pour la
15 production d'émissions canadiennes ne leur réserve que
16 20 pour cent des ressources du Fonds de production des
17 câblodistributeurs. Conséquence: Nous avons dû
18 recourir au marché international au lieu de soutenir
19 une production de documentaires ancrés dans notre
20 réalité et produits par nos artisans.
21 2925 Si cette situation se perpétue, on
22 réduira la qualité et la diversité de produits à forte
23 référence d'une culture qui nous est propre. Et nous
24 craignons même qu'une telle dégradation de l'offre
25 télévisuelle francophone dans ces domaines n'entraîne,
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1 à terme, un désintéressement du public à l'égard de la
2 télévision francophone.
3 2926 C'est pourquoi, dans notre mémoire,
4 nous nous sommes permis d'inviter le Conseil à exercer
5 son influence de sorte que le FTCPEC:
6 2927 - assure, pour la production
7 francophone, un financement plus important aux
8 émissions portant sur les arts de la scène, les grands
9 documentaires, les émissions pour enfants et à certains
10 types d'émissions de formation continue grand public;
11 2928 - harmonise aussi la procédure
12 d'attribution des ressources du Fonds de production des
13 câblodistributeurs et du Fonds de développement
14 d'émissions canadiennes de télévision de Téléfilm
15 Canada.
16 2929 Je conclus brièvement.
17 2930 Notre position se veut pro-active.
18 Les forces qui poussent à la libéralisation sont
19 majeures, mais laissées à elles-mêmes, elles peuvent
20 produire le contraire des effets positifs annoncés.
21 C'est pourquoi il faut savoir résister sur certains
22 points névralgiques. Il faut aussi savoir parfois
23 résister à la précipitation. Quand la situation est
24 urgente, il faut savoir ne pas se presser pour bien
25 saisir les enjeux et concevoir les règles nouvelles qui
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1 assureront la saine régulation du nouvel environnement.
2 2931 Vous devez donc -- et cela est notre
3 conviction profonde -- garder avec plus de soins encore
4 la maîtrise d'oeuvre de cette régulation.
5 2932 LA PRÉSIDENTE: Merci, monsieur.
6 2933 Il est évident et dans votre
7 présentation de ce matin et votre soumission écrite que
8 vous êtes préoccupés par les effets de la
9 multiplication des canaux spécialisés, et
10 particulièrement quand ils sont le résultat de
11 concentration ou d'intégration horizontale ou verticale
12 avec des services qui existent déjà.
13 2934 Vous avez sans doute lu ou entendu
14 les propos de Radio-Canada au sujet de constellations
15 et la force que ça peut donner pour améliorer l'offre
16 de la programmation, surtout dans un marché plus
17 étroit. Vous prenez donc une position contraire à
18 celle-là en vous inquiétant de la prolifération d'une
19 programmation qui est répétée sur des chaînes
20 généralistes et sur des canaux spécialisés qui sont
21 sous la même propriété.
22 2935 Est-ce que je comprends bien vos
23 propos?
24 2936 M. INCHAUSPÉ: Oui.
25 2937 M. LAGACÉ: Oui, c'est exact. On
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1 croit que toute une série de contenus qui sont le
2 propre de chaînes spécialisées comme la nôtre, comme
3 une chaîne culturelle et éducative, risquent, lorsqu'on
4 fait une fort concentration, d'avoir un peu le même
5 effet que la situation qui existait avant les années
6 quatre-vingt, où le Conseil, pour rediversifier
7 l'offre, a supporté à ce moment-là la création d'un
8 secteur de production indépendante et la création des
9 divers canaux spécialisés.
10 2938 En reconcentrant peut-être dans les
11 mains de deux joueurs majeurs au Québec, un joueur
12 public et un joueur privé, on pense qu'à travers ça va
13 se reproduire d'une certaine façon la situation qui
14 existait antérieurement aux années quatre-vingt, que
15 des services comme le nôtre risquent à ce moment-là
16 d'être marginalisés et qu'un certain nombre de types de
17 produits risquent aussi d'être marginalisés à
18 l'intérieur de la concurrence qui va s'exercer à
19 travers ces deux grands joueurs sur le marché.
20 2939 On peut prendre un certain nombre
21 d'exemples là-dessus. Par exemple, je pense qu'au
22 niveau culturel il y a un certain type de produits qui
23 n'existeraient plus sur le marché si nous, par exemple,
24 on disparaissait. Par exemple -- et Mario peut en
25 parler plus amplement que moi -- on a constaté que sur
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1 notre marché, par exemple, la chanson francophone avait
2 à peu près disparu chez les diffuseurs québécois et on
3 s'est rendu compte aussi qu'à un certain moment donné
4 toute une partie du documentaire, du court et moyen
5 documentaire, n'existait à peu près pas comme diffusion
6 sur les ondes. Un certain type d'émissions pour
7 enfants, si Télé-Québec n'avait pas développé une
8 approche à travers le secteur jeunesse vers des publics
9 ciblés comme par exemple les 3-5 ans, les 6-9, et
10 caetera, avec Passe-Partout, Robin Stella, et caetera,
11 toute une télévision éducative qui s'intéressait au
12 développement de l'enfant, ce genre de télévision
13 n'aurait probablement pas réussi à se développer à
14 l'intérieur du marché francophone.
15 2940 Oui, on est, là-dessus, très
16 craintifs par rapport à cette reconcentration-là qui
17 est, paradoxalement, un effet pervers de la
18 multiplication des chaînes, où les grands joueurs
19 veulent se réapproprier le marché.
20 2941 LA PRÉSIDENTE: Alors, contrairement
21 à Radio-Canada, même s'il y a l'étroitesse du marché,
22 cette concentration-là pour vous est nocive, et il
23 vaudrait mieux qu'il y ait moins de services de langue
24 française accessible si la seule possibilité financière
25 ou économique de les obtenir, c'est de les concentrer
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1 dans les mains des mêmes propriétaires?
2 2942 Je vois dans votre soumission, par
3 exemple, que vous suggérez certains correctifs. Si je
4 comprends bien, par exemple, les exigences vis-à-vis
5 soit les dépenses ou la diffusion de contenu canadien
6 par une chaîne généraliste... elle ne serait pas
7 comptabilisées pour rencontrer ces exigences-là si elle
8 était répétée par un canal spécialisé dont la propriété
9 est la même, pour obliger les canaux spécialisés à
10 avoir une programmation complètement... donc, ce sont
11 les effets de la concentration qui vous inquiètent
12 plutôt que la propriété commune en soi.
13 2943 Mais possiblement avez-vous songé...
14 nous entendons évidemment toujours ce commentaire que
15 le marché québécois est très étroit. Est-ce que vous
16 prévoyez la possibilité d'avoir plus de joueurs
17 corporatifs dans le marché si le Conseil ne permet pas
18 ce genre de constellation prévue par Radio-Canada?
19 2944 M. BÉLISLE: Un des aspects de notre
20 crainte de la concentration limitée peut-être à deux
21 joueurs est qu'on constate dans le marché, ne serait-ce
22 qu'on en parle un peu dans notre mémoire, sur
23 l'acquisition de nouveaux produits...
24 2945 LA PRÉSIDENTE: Excusez-moi, par
25 "deux joueurs", vous voulez dire le joueur public et le
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1 joueur privé?
2 2946 M. BÉLISLE: Oui, les deux.
3 2947 LA PRÉSIDENTE: Mais nous avons quand
4 même quelques joueurs dans le secteur privé.
5 2948 M. BÉLISLE: Oui, tout à fait.
6 2949 LA PRÉSIDENTE: Allez-y.
7 2950 M. BÉLISLE: On constate, juste pour
8 l'acquisition de produits, lorsqu'on voit, je citais
9 l'exemple de Radio-Canada qui va acheter des produits
10 pour sa chaîne sur des reportages et demander pour
11 trois passes, ce qui se fait très normalement pour des
12 chaînes en général, et de demander de se faire donner
13 huit passes à son canal RDI, on reproduit encore une
14 fois le même produit.
15 2951 On a des ententes présentement avec
16 Radio-Canada sur les D-théâtres (ph.). On pense qu'une
17 concentration de chaînes spécialisées à Radio-Canada ne
18 favorisera pas qu'on ait éventuellement d'autres
19 ententes sur ce genre de produits là. On ne voit pas la
20 diversité de pouvoir sortir avec un principe de
21 concentration dans les chaînes généralistes.
22 2952 Sur le marché de la publicité -- on
23 en parle également dans le mémoire -- une autre crainte
24 qu'on a, évidemment, pour les chaînes qui ne
25 possèderont pas une constellation de produits, est que
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1 la concurrence et l'accessibilité à des produits va
2 être très difficile. Ça fait partie également des
3 craintes qu'on a sur la concentration.
4 2953 LA PRÉSIDENTE: À ce moment-là, vous
5 vous inquiétez pour le système en général...
6 2954 M. BÉLISLE: Oui.
7 2955 LA PRÉSIDENTE: ... et l'effet,
8 évidemment, que ça peut avoir sur Télé-Québec.
9 2956 Mais, malgré ça, à la page 5 de votre
10 soumission vous mentionnez que vous avez quand même
11 réalisé des collaborations ou des ententes avec Radio-
12 Canada.
13 2957 M. BÉLISLE: Tout à fait. Dans le
14 passé on en a fait et on espère encore en faire. Notre
15 crainte, c'est qu'éventuellement, si Radio-Canada a des
16 chaînes spécialisées, ce type de partenariat là va
17 disparaître.
18 2958 LA PRÉSIDENTE: Aux dépens vraiment
19 de la possibilité pour Télé-Québec de continuer d'en
20 profiter, et d'autres joueurs aussi.
21 2959 Par exemple, dans le cas de Radio-
22 Canada, ou aussi le secteur privé, d'avoir un permis de
23 télévision généraliste et aussi un permis par exemple
24 spécialisé pour nouvelles, qui entraîne une répétition
25 mais qui quand même permet au public d'avoir l'avantage
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1 au moins de revoir cette programmation-là dans un
2 créneau horaire différent, vous ne voyez pas ça comme
3 un avantage pour l'auditoire qui vaut le risque que
4 vous mentionnez?
5 2960 M. BÉLISLE: On peut comprendre
6 qu'effectivement il y a un avantage pour l'auditoire,
7 mais il faut voir qu'à long terme, si pour l'auditoire
8 c'est dans d'autres créneaux que les autres joueurs
9 vont être affectés, je pense qu'il faut en tenir compte
10 également.
11 2961 M. INCHAUSPÉ: Madame, ce que nous
12 voulons dire, c'est la chose suivante: On n'est pas
13 contre la multiplication des chaînes, on sait que c'est
14 le jeu, sauf qu'un marché, quand on introduit de
15 nouveaux joueurs, a besoin d'un certain temps pour
16 retrouver des équilibres. Nous constatons au moins
17 dans un premier temps que ce qui est en train de se
18 constituer, c'est la concentration, c'est des formes
19 d'intégration qui détruisent l'effet qu'on recherchait.
20 2962 Si on introduit encore d'autres
21 joueurs, qu'est-ce que ça va faire? C'est une loi
22 qu'on dit non écrite, la multiplication entraîne aussi
23 la concentration; c'est aussi une loi du marché; il ne
24 faut pas se faire d'illusions.
25 2963 Ce que nous vous soumettons, c'est
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1 que relativement à la problématique que vous abordez,
2 qui est d'abord dans un premier temps celle de
3 l'ouverture, je pense qu'il faut aussi regarder, comme
4 quand on joue aux échecs, au deuxième ou au troisième
5 coup qu'est-ce qu'il peut se passer et peut-être
6 prévoir des mécanismes de telle façon que ces effets
7 n'aient pas lieu. Tant mieux si ces craintes ne sont
8 pas là. Nous sentons déjà des phénomènes de cet ordre,
9 mais peut-être que dans quatre ans, cinq ans, le
10 marché, s'il était le même, se remettrait en place;
11 enfin, l'introduction de joueurs nouveaux peut créer de
12 nouveau des perturbations à l'intérieur du marché.
13 2964 C'est simplement ça: ces équilibres
14 qui nous semblent être la perspective qui est la vôtre
15 de l'existence aussi toujours, comme nous, à
16 l'intérieur de cet élément-là, dans l'ouverture qui est
17 faite à l'heure actuelle, au moins dans un premier
18 temps ce n'est pas nécessairement ça qui se passe.
19 2965 C'est tout.
20 2966 LA PRÉSIDENTE: Alors vous préconisez
21 à ce moment-là un frein à la multiplication des canaux
22 spécialisés, surtout quand ils sont sous la même
23 propriété, quand ils représentent la concentration, et
24 deuxièmement, une certaine protection pour vous s'il y
25 avait une meilleure harmonisation de la procédure
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1 d'attribution de fonds pour la programmation et une
2 distribution plus objective qui, à ce moment-là, vous
3 permettrait d'avoir plus facilement accès pour ce que
4 vous, vous considérez comme des catégories sous-
5 représentées. Alors ce serait en ce moment des
6 correctifs qui, pour vous, sont nécessaires au moins à
7 court terme.
8 2967 M. INCHAUSPÉ: En ce qui concerne le
9 financement, oui, et je vais laisser Mario vous
10 indiquer les effets qu'on a constatés.
11 2968 M. CLÉMENT: C'est parce que ce qu'on
12 observe, nous, dans la multiplication des chaînes,
13 c'est qu'on est en train de superposer des mandats de
14 télévision et ce que devait être l'objectif des canaux
15 spécialisés au départ, c'était une complémentarité dans
16 l'offre.
17 2969 Ce qu'on est en train d'observer, et
18 particulièrement avec les joueurs publics, c'est que le
19 concurrent, par exemple, de Télé-Québec pour
20 l'acquisition de certaines émissions, pour le cinéma,
21 et dans le développement de certaines émissions
22 culturelles, c'est Radio-Canada, c'est éventuellement
23 TVOntario. Alors on est dans des champs, nous autres,
24 qui ne sont pas rentables comme tel. On fait de la
25 télévision dans des catégories sous-représentées, et
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1 ensuite de ça ce financement public là, maintenant, on
2 est en train de servir une concurrence entre ces
3 joueurs-là.
4 2970 Les effets pervers que ça a dans un
5 type de programmation comme celle de Télé-Québec, par
6 exemple, c'est qu'en bout de ligne nous, il y a cinq
7 ans, on avait 52 semaines de production originale à
8 offrir aux téléspectateurs, il y a trois ans on l'a
9 baissée à 40 semaines, cette année c'est rendu 31
10 semaines; ceci veut dire que dans les 20 semaines qui
11 vont suivre les 31 semaines entre le 1er septembre et
12 le 1er avril, ça va être de la répétition. Si ça
13 continue comme ça, si d'autres chaînes qui viennent
14 superposer leur mandat à celui de Télé-Québec, c'est
15 bien évident que ce sera 26 semaines la prochaine fois.
16 2971 Alors nous, on est en train d'essayer
17 de structurer une programmation autour de produits qui
18 ne sont pas rentables, et ensuite de ça on va créer
19 d'autres joueurs qui vont venir s'agglutiner autour des
20 mêmes financements, et à ce moment-là le rôle que nous
21 autres, on est supposés jouer, on le joue d'une façon
22 moins pertinente.
23 2972 Alors c'est le problème actuellement
24 de croissance que nous autres, on vit.
25 2973 M. BÉLISLE: Si vous permettez, il y
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1 a également la question -- et je pense que c'est
2 indissociable -- d'ajouter des canaux spécialisés avec
3 le mode de financement actuel et la capacité des fonds
4 publics; on est inquiets, on ne pense pas qu'il va y
5 avoir un ajout de fonds publics, pas à court terme à
6 tout le moins. Et les effets qu'on a constatés cette
7 année dans notre programmation, je pense que le Conseil
8 a été très sensibilisé: on est arrivés au fonds, et en
9 dedans d'une heure il n'y avait plus de sommes d'argent
10 disponibles.
11 2974 Dans cette perspective-là, on se
12 demande comment est-ce qu'il y a de nouveaux joueurs
13 qui s'ajouteraient avec encore la même masse
14 financière, qu'on va améliorer la qualité des émissions
15 canadiennes et même les contenus canadiens.
16 2975 LA PRÉSIDENTE: Quand vous parlez de
17 nouveaux joueurs, vous voulez dire des vraiment
18 nouveaux joueurs et des permis accordés à des joueurs
19 existants?
20 2976 M. BÉLISLE: C'est exact.
21 2977 LA PRÉSIDENTE: Vous voulez dire des
22 nouveaux services.
23 2978 M. BÉLISLE: Oui.
24 2979 LA PRÉSIDENTE: Maintenant, vous
25 recommandez à la page 13 que le Conseil ne devrait pas
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1 permettre à Radio-Canada d'exploiter d'autres licences
2 de canaux spécialisés. Est-ce que cette
3 recommandation-là s'étendrait aussi à ceux qui oeuvrent
4 dans le domaine en ce moment et qui ont eux-mêmes aussi
5 un permis de télévision généraliste ou est-ce que c'est
6 un problème que vous identifiez pour Radio-Canada en
7 particulier?
8 2980 M. INCHAUSPÉ: Je pense que, s'il y a
9 eu ceci, c'est parce qu'il y avait une question
10 spécifique qui concernait... et c'était une réponse à
11 une question spécifique.
12 2981 LA PRÉSIDENTE: Maintenant je vous en
13 pose une autre spécifique, qui est: Est-ce que vous
14 avez le même problème avec le secteur privé?
15 2982 M. LAGACÉ: Oui. Là-dessus, on est
16 très sensibles à l'équilibre qui doit exister entre le
17 secteur public et le secteur privé au Québec. En ce
18 sens-là, sur cette question-là, on a longuement
19 discuté, et le problème qui nous touche le plus, c'est
20 le phénomène de la concentration. On ne voudrait pas
21 que notre intervention fasse que le secteur public et
22 Radio-Canada soient comme émasculés de ces capacités
23 d'intervention sur le marché de la télévision
24 francophone. Si c'était le cas, ce serait pour nous
25 négatif.
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1 2983 Ceci dit, on est conscients qu'il
2 faut être particulièrement attentifs et vigilants par
3 rapport à la Société Radio-Canada, qui, elle, reçoit
4 des fonds publics et des mandats spécifiques, et c'est
5 normal que notre vigilance là-dessus est plus grande à
6 cause de ces modes de financement.
7 2984 Ceci dit, on est très sensibles à
8 l'équilibre, et si notre souhait était clair, ce serait
9 d'être très vigilants par rapport particulièrement à
10 l'intégration des diffuseurs conventionnels ou des
11 chaînes spécialisées avec des distributeurs, et
12 caetera, qui fait qu'il se mette à y avoir des
13 contrôles de parts de marché.
14 2985 LA PRÉSIDENTE: Je crois que ce qui
15 devrait nous intéresser, évidemment, c'est que vous
16 concluez dans votre soumission écrite, particulièrement
17 par exemple à la page 5, qu'il y aura une dilution de
18 la qualité -- non, c'est à la page 7, je crois -- que
19 l'effet sera éventuellement de diluer la qualité de la
20 programmation offerte parce que les nouveaux services
21 verront la nécessité de répondre à une demande toujours
22 accrue. Donc il y aura le même argent, mais la
23 programmation sera moindre.
24 2986 C'est évidemment une position
25 différente de celle de Radio-Canada, par exemple, qui
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1 dit que les constellations, c'est le futur, et nous
2 pourrons donner plus de qualité si nous avons plus de
3 force de base économique pour y arriver. Évidemment,
4 vous avez un mandat différent et vous voyez le
5 développement différemment.
6 2987 Ce matin dans votre présentation
7 écrite à la page 2, le dernier paragraphe avant la
8 partie où vous discutez des effets de la multiplication
9 des canaux spécialisés, pouvez-vous me dire, quand vous
10 dites:
11 2988 "Ce qui nous préoccupe, c'est
12 l'impact que peuvent avoir...
13 une libéralisation complète de
14 l'accès aux chaînes
15 spécialisées..."
16 2989 Quand vous parlez de l'accès aux
17 chaînes spécialisées, vous voulez dire l'accès aux
18 permis des chaînes spécialisées...
19 2990 M. CLÉMENT: Oui.
20 2991 LA PRÉSIDENTE: ... pas l'accès des
21 abonnés aux chaînes spécialisées. Je comprends.
22 2992 Je vous remercie, messieurs. Nous
23 vous remercions d'être venus de Montréal nous voir et
24 nous espérons que vous aurez un bon voyage de retour.
25 Et je suis certaine que Mme Bertrand est aux écoutes.
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1 2993 Me BLAIS: Madame Wylie, j'aurais
2 quelques petites questions, si vous me permettez.
3 2994 LA PRÉSIDENTE: Oh, pardon, Monsieur
4 le Conseiller juridique. Allez-y.
5 2995 Pardon, maintenant M. le Conseiller
6 Cardozo a une question.
7 2996 CONSEILLER CARDOZO: Je m'excuse.
8 Merci.
9 2997 J'aimerais savoir votre point de vue
10 clairement sur la question de multiplication. Vous
11 avez des problèmes avec la concentration verticale et
12 aussi des problèmes avec la multiplication des canaux
13 spécialisés.
14 2998 Est-ce que c'est correct que vous
15 préférez le statu quo pour quelques années?
16 2999 M. INCHAUSPÉ: En ce qui concerne le
17 problème de la concentration, c'est un problème nouveau
18 qu'on vous soumet. Je pense que de toute façon, ce qui
19 a lieu là va avoir lieu. Donc, en conséquence, vous
20 aurez à affronter cette question pour savoir comment
21 faire en sorte que vous n'obteniez pas, en libéralisant
22 le marché, l'effet contraire de ce que vous cherchiez.
23 3000 En ce qui concerne la question des
24 canaux spécialisés, là-dessus, on vous donne un certain
25 nombre de conditions qui sont nécessaires pour avoir
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1 ces permis dont il faudrait tenir compte. Maintenant,
2 si vous apportez un problème de jugement global, nous
3 constatons le fait suivant; c'est que l'introduction
4 des canaux spécialisés s'est faite en trois temps.
5 Entre le premier mouvement et le deuxième mouvement il
6 y a eu sept ans; le marché a pu se faire organiser; le
7 deuxième a eu deux ans. Nous, nous n'avons vu
8 concrètement les effets que cette année relativement à
9 la programmation... ce qui nous préoccupait, c'était la
10 programmation.
11 3001 L'existence de nouveaux joueurs a
12 créé un certain nombre de problèmes; on va se
13 réajuster, mais enfin, ça a créé un certain nombre de
14 problèmes et nous craignons, s'il y a de nouveau, très
15 rapidement, une ouverture encore complète sans que des
16 règles précises que vous avez établies pour l'accès ou
17 des éléments de cet ordre, que ça ne fasse que
18 perpétuer le phénomène que nous avons vécu.
19 3002 C'est une question de sagesse et de
20 jugement à la fois sur les configurations et sur le
21 rythme. Il y a déséquilibre. L'introduction très
22 rapide... les joueurs, il leur faut un certain temps
23 pour s'ajuster. C'est comme ça, la réalité dans
24 laquelle on est.
25 3003 C'est la raison pour laquelle on
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1 soumet à votre jugement et à votre sagacité -- vous
2 êtes des sages -- ce problème, qui est d'abord à long
3 terme, celui de la concentration qui s'en vient, qui
4 est l'autre étape, que vous ne pourrez pas éviter, et
5 la deuxième, c'est les effets de la multiplication, les
6 sources de revenus étant les mêmes, et caetera, ces
7 phénomènes-là, qui est dans quel rythme on introduit et
8 à partir de quels critères.
9 3004 Je n'ai pas plus que ça. On voulait
10 en tout cas vous donner quelques indications des
11 préoccupations que nous avons et suggérer quelques
12 moyens, nous semble-t-il, qui pourraient le faire,
13 mais, comme on vous le dit, ce n'est pas exhaustif,
14 nous n'avons pas la vue générale, mais simplement à
15 partir de l'observation que nous avons faite, nous
16 avons déjà constaté ces mouvements.
17 3005 Donc c'est ça que nous voulions vous
18 dire.
19 3006 M. CLÉMENT: Moi, je voudrais donner
20 un exemple concret de ce que ça a produit, par exemple,
21 cette année.
22 3007 Il y a deux ans il y a eu une
23 émission de quelques cinq ou six licences pour le
24 Québec. La première année, les gens ont eu le temps
25 de... c'est-à-dire qu'ils étaient beaucoup plus
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1 préoccupés à préparer l'entrée en ondes que se
2 structurer en termes de programmation. Alors on a fait
3 une programmation qui était balancée en contenu
4 canadien et en acquisitions pour respecter les règles,
5 mais ensuite de ça les gens ont voulu arriver avec des
6 projets plus structurants.
7 3008 Télé-Québec, avec le même budget il y
8 a deux ans que cette année, a un manque à gagner en
9 termes de financement, c'est-à-dire de valeur de
10 production, d'au-delà de 7 millions de dollars.
11 L'exemple concret de ça, c'est que, pendant que nous,
12 on était en train de travailler sur des projets, par
13 exemple, documentaires... on voulait avoir une case
14 documentaire pour être capables de vitaliser un milieu,
15 le milieu du documentaire, qui souffre énormément
16 actuellement de ça.
17 3009 On avait un projet, nous autres, qui
18 était de 26 documentaires originaux, par exemple, dans
19 une case de documentaires sociaux. Avec ce qui est
20 arrivé au Fonds des câblos, nous, on a eu six projets
21 qui se sont réalisés sur 20 pour une raison très
22 simple; c'est que ce qui passait au Fonds des câblos,
23 naturellement, c'était du produit qui n'avait pas
24 besoin d'être analysé ni chez nous, ni à Téléfilm
25 Canada. Donc ce qui s'est classé là-bas, ce qui est
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1 allé chercher du financement, c'est un type
2 d'émissions, je dirais que ce sont des projets moins
3 structurants que ce que nous, on voulait mettre de
4 l'avant.
5 3010 Ceci fait qu'on a pris l'argent qui
6 était disponible pour nous en termes de licence pour
7 ces documentaires-là puis on est allés sur le marché
8 international pour acheter ça, ce qui fait qu'on a pris
9 l'argent des Canadiens et on est allés le dépenser à
10 l'extérieur; on n'a pas pu être des leviers économiques
11 pour être capables de mettre sur pied des projets que
12 nous, on considère comme vitaux.
13 3011 Alors c'est un peu l'effet qu'on a.
14 Et on se dit si jamais on est devant le même phénomène
15 dans deux ans, on va exactement être à la même place.
16 Et comme nous, le rôle qu'on a à jouer dans le secteur
17 de la jeunesse, dans le secteur culturel, dans le
18 secteur documentaire, dans le secteur du cinéma, du
19 court métrage, on ne sera plus capables de le jouer,
20 alors que les projets qui vont être faits ailleurs en
21 contenu vont être, je dirais, moins structurants.
22 3012 Pour nous, c'est important de dire
23 que l'argent public doit servir à vitaliser ces
24 milieux-là parce que ce n'est pas dans l'industrie
25 privée qu'ils vont le faire, c'est à nous de le faire.
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1 Alors s'il y a moins de financements qui sont
2 disponibles, c'est clair que le rôle qu'on va avoir à
3 jouer maintenant va être moins structurant. Pour nous
4 autres, c'est une inquiétude, ça.
5 3013 M. INCHAUSPÉ: Non seulement une
6 inquiétude de ce point de vue, c'est aussi une
7 inquiétude de la mission d'une télévision éducative;
8 nous pensons que c'est l'enracinement qui est important
9 et que les acquisitions extérieures ne nous permettent
10 pas cet enracinement et qu'à terme, ils ne soient pas
11 intéressés si ce sont des émissions qui sont faites
12 ailleurs, dans lesquelles on ne se retrouve pas. On a
13 cette double inquiétude.
14 3014 CONSEILLER CARDOZO: Merci beaucoup.
15 3015 Merci, Madame la Présidente.
16 3016 LA PRÉSIDENTE: Maître Blais.
17 3017 Me BLAIS: Quelques petites questions
18 de précision.
19 3018 Je remarque qu'hier l'Association des
20 télévisions éducatives ont fait des recommandations
21 relativement à des documentaires en général, tandis
22 qu'aujourd'hui, vous, vous mettez l'emphase sur ce que
23 vous appelez les grands documentaires.
24 3019 Est-ce qu'il y a une spécificité du
25 marché francophone qui vous amène à mettre l'emphase
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1 sur cette catégorie plutôt que les documentaires en
2 général?
3 3020 M. CLÉMENT: Non. Moi, je ne vois
4 pas de différence.
5 3021 Me BLAIS: Mais, quand même, vous
6 soulignez la notion de grands documentaires; vous
7 utilisez cette phrase dans vos soumissions.
8 3022 Est-ce qu'on doit comprendre une
9 définition particulière pour ce genre de documentaires?
10 3023 M. CLÉMENT: Écoutez, le
11 documentaire, ce sont des budgets qui peuvent varier
12 entre 100 000 $ et 300 000 $ à 400 000 $. Le grand
13 documentaire, pour nous, c'est une question finalement
14 budgétaire.
15 3024 Fondamentalement, ce qu'on voudrait
16 éventuellement développer, c'est le grand documentaire,
17 c'est-à-dire un produit qui, au niveau de son contenu
18 et de sa forme et de la production qu'on peut y mettre,
19 des coûts de production qu'on peut y injecter, un
20 projet qui va être durable.
21 3025 Alors, quand on parle de grand
22 documentaire, pour nous, c'est beaucoup plus sur sa
23 durabilité, sur sa capacité d'exportation, des choses
24 comme ça. Fondamentalement, on a le même phénomène.
25 Qu'on parle de documentaires ou de grands
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1 documentaires, pour nous, il y a une difficulté, et
2 elle est aussi bien pour le documentaire que pour le
3 grand documentaire et encore plus du côté du grand
4 documentaire.
5 3026 Me BLAIS: Dans vos recommandations
6 aussi vous utilisez l'expression "dramatiques lourdes".
7 J'ai eu la discussion avec Mme Baillargeon hier à
8 savoir comment définir ce qu'était une dramatique
9 lourde et je lui ai demandé de déposer une définition
10 d'ici le 15 octobre.
11 3027 Est-ce que ce serait possible pour
12 vous aussi, étant donné que vous faites des
13 recommandations reliées à cette notion, de nous fournir
14 une définition de ce que vous entendez par "dramatique
15 lourde"?
16 3028 M. CLÉMENT: Écoutez, on va vous en
17 fournir, une définition. Moi, je vous dirais
18 spontanément que la définition d'une dramatique lourde,
19 c'est des valeurs, en fait, budgétaires. Une
20 dramatique lourde, ça vaut à peu près entre 800 000 $
21 et 1 million de dollars l'heure; les semi-lourdes,
22 qu'on appelle -- c'est la nouvelle tendance qu'on a
23 développée; à la place de le tourner en cinéma, on le
24 fait en vidéo -- c'est aux alentours de 400 000 $,
25 500 000 $ l'heure. Alors pour moi, le vocabulaire de
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1 ça, il est moins philosophique que très pragmatique en
2 termes budgétaires.
3 3029 Alors on pourra éventuellement
4 ajouter un peu de chair autour de cette définition-là,
5 mais globalement, c'est cette approche-là qu'on va
6 avoir, nous.
7 3030 Me BLAIS: D'ici le 15 octobre si
8 c'est possible?
9 3031 M. CLÉMENT: Tout à fait.
10 3032 Me BLAIS: Par ailleurs, quand vous
11 parlez des fonds et de l'accès aux fonds, vous demandez
12 que d'autres genres d'émissions ou types d'émissions,
13 puissent y avoir accès, dont les documentaires, les
14 arts de la scène et les productions d'émissions pour
15 enfants.
16 3033 Est-ce que vous aviez des
17 pourcentages en tête spécifiques pour ces catégories?
18 Est-ce qu'on doit les voir globalement ou est-ce que
19 vous recommandez que le fonds mette X pour cent pour
20 chacune de ces trois catégories de production?
21 3034 M. LAGACÉ: Honnêtement, là-dessus,
22 la discussion était plutôt sur les émissions sous-
23 représentées, et on n'a pas vraiment travaillé en
24 termes de pourcentage identifié pour chacune des
25 catégories. On pense que les trois catégories sont
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1 sous-représentées et on était intéressés dans les trois
2 catégories. Alors on n'a pas discuté sur des
3 pourcentages exactement dans le fonds.
4 3035 Me BLAIS: Merci.
5 3036 LA PRÉSIDENTE: Je vous dis au revoir
6 une deuxième fois.
7 3037 M. BÉLISLE: Merci beaucoup.
8 3038 LA PRÉSIDENTE: Nous allons
9 maintenant prendre une pause et nous reprendrons à
10 11 h 10. We will be back after a coffee break at ten
11 after eleven.
12 --- Short recess at / Courte suspension à 1055
13 --- Upon resuming at / Reprise à 1115
14 3039 THE CHAIRPERSON: Madam Secretary,
15 would you invite the next participant, please?
16 3040 MS BÉNARD: Thank you, Madam Chair.
17 3041 The next presentation will be by
18 Friends of Canadian Broadcasting and I would invite Ms
19 Golfman to introduce her colleagues.
20 PRESENTATION / PRÉSENTATION
21 3042 MS GOLFMAN: Good morning, Madam
22 Vice-Chairperson and Members of the Commission. My
23 name is Noreen Golfman. I am a Professor of English
24 literature and film studies at Memorial University in
25 St. John's, Newfoundland. I am also President of the
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1 Association of Canadian College and University Teachers
2 of English and in my spare time I chair the Steering
3 Committee of the Friends of Canadian Broadcasting.
4 3043 I would like to introduce my
5 colleagues to you today. To my left is Maggie Siggins,
6 noted Canadian journalist, writer and member of the
7 Friends' of Canadian Broadcasting Steering Committee
8 from Regina; to my far right is Arlan Gates, former
9 President of the University of Winnipeg Students'
10 Association, currently studying law at the University
11 of Toronto and principal author of the research report
12 appended to Friends' submission entitled "What's on
13 TV"; and Ian Morrison, our spokesperson, to my right.
14 3044 We applaud the way you have
15 positioned this hearing in your Vision Action Calendar.
16 The broad scope of your public notice is both
17 appropriate and timely. We have also been highly
18 impressed by your willingness and capacity to reach out
19 to the interested public in advance of this hearing,
20 including the substantial series of experimental public
21 forums you organized in June and your intention to
22 encourage informal public input following the end of
23 this formal hearing is a positive step, entirely
24 consistent with your outreach strategy.
25 3045 Nous applaudissons le positionnement
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1 de ces audiences au calendrier des activités publiées
2 dans le cadre de votre Vision. L'envergure de votre
3 avis public est tout à fait à propos. Nous avons été
4 très impressionnés de votre ouverture et de votre
5 détermination à inclure les membres du public, surtout
6 lors des consultations et réunions que vous avez tenues
7 à travers le Canada au mois de juin.
8 3046 Nous voyons également d'un oeil très
9 positif votre initiative en invitant les citoyens à
10 vous soumettre leur opinion formellement à la suite de
11 ces audiences. Cette initiative colle parfaitement à
12 votre stratégie d'ouverture et d'écoute du public.
13 3047 In this brief presentation we want to
14 highlight two key issues: threats to local programming
15 and what you describe as "equitable" financial
16 contributions by major station groups.
17 3048 Maggie?
18 3049 MS SIGGINS: To comprehend the wide
19 world, we must understand our own communities, how they
20 are built, how we play a role in them. Television is
21 the most powerful instrument I can think of in
22 providing us with a sense of our own unique environment
23 and showing us how we belong. It is a crucial home
24 team training ground for those creative people, the
25 actors, writers, set designer, journalists, who would
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1 surely leave a small city like mine if their talents
2 were neglected. Yet in recent years budget cuts have
3 greatly diminished the presence of the CBC in regions
4 such as Saskatchewan.
5 3050 Certainly CBC programs have been
6 Canadianized, but at what expense to local viewers?
7 The schedule is now driven by national programming,
8 supplemented, if necessary, by repeats. We note with
9 regret that the CBC's brief does not even refer to its
10 local and regional responsibilities. Over the past 15
11 years viewing of CBC's local television programming has
12 declined from ten per cent of all Canadian viewing to
13 just three per cent. In prime time, the audience is
14 virtually non-existent.
15 3051 Many private broadcasters and multi-
16 station owners like Canadian content about as much as a
17 kid does broccoli. It is eaten under duress and only
18 so dessert can be served; in this case, high-
19 profit/low-cost American programs. Scheduling regional
20 or local product during prime time would be like
21 putting broccoli on the dessert menu. The most
22 important message which Friends wishes to convey is
23 that the local and regional programming is threatened.
24 3052 Through the Broadcasting Act,
25 Parliament has clearly indicated that it recognizes the
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1 importance of local television and that it intends the
2 broadcasting system to pay careful attention to the
3 regions. The Act states that the program should "be
4 drawn from local, regional, national and international
5 sources." Each has equal weight. "Local Canadian
6 stations" are given priority in the distribution
7 system. The national public broadcaster is charged
8 with reflecting "Canada and its regions to national and
9 regional audiences while serving the special needs of
10 these regions", and the Act specifically directs the
11 Commission to "take into account regional needs."
12 3053 So, in what ways is local and
13 regional expression threatened? Friends undertook to
14 find out by commissioning original research. We picked
15 Winnipeg as a typical Canadian television market and
16 focused on local choices available to viewers in south-
17 central Manitoba from Winnipeg-based conventional
18 broadcasters. We also gathered some comparative data
19 from the lower mainland of British Columbia.
20 3054 Arlan?
21 3055 MR. GATES: Our report measured and
22 assessed the availability of local and regional
23 programming on conventional television channels in a
24 representative six-week period last autumn and winter
25 and compared their availability with compatible data
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1 from 1986/87. Here are a few of the report's principal
2 findings.
3 3056 The overall quantity of available
4 local programs declined by 20 per cent over the 11-year
5 period in Winnipeg, while non-news programming dropped
6 by 38 per cent. In 1986/87, news represented only 42
7 per cent of local programs. By 1997/98, news accounted
8 for 55 per cent of a smaller universe of local shows.
9 3057 Local and regional programs aired on
10 Winnipeg conventional television stations dropped from
11 21 per cent of programs in 1986/87 to 16 per cent last
12 winter, but these 16 per cent of programs attracted 19
13 per cent of the conventional stations' audience, even
14 though very few of these local programs were broadcast
15 during prime time. In Winnipeg, the availability of
16 locally-produced under-represented categories of
17 programming, drama, music and variety, declined sharply
18 over the 11-year period. Thirty-eight non-news
19 indigenous program titles were produced in the Winnipeg
20 area each week in 1986/87, but only 16 were produced
21 last winter.
22 3058 En terminant, presque deux-tiers des
23 bulletins de nouvelles locales étaient diffusés aux
24 mêmes heures que d'autres émissions locales.
25 3059 Ian?
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1 3060 MR. MORRISON: Thanks, Arlan.
2 3061 Among English-speaking viewers in
3 Canada, one-third of total viewing is devoted to
4 Canadian programs. This Canadian viewing has three
5 components: 44 per cent is conventional television
6 network programming, 28 per cent is specialty channels,
7 and fully 28 per cent is local programs.
8 3062 From this study, Friends concludes
9 that Canadians are demonstrating a major, sustained
10 appetite for local programs. Yet the evidence we have
11 collected suggests that the supply of local programming
12 is skewed away from convenient listening and viewing
13 times. It's decreasing even in non-peak viewing
14 periods and a substantial share, perhaps the majority,
15 of local programs are competing for audience with other
16 local programs.
17 3063 We draw your attention to the
18 schedules of English-language conventional broadcasters
19 in several Canadian cities this past March. Let me
20 illustrate briefly for the National Capital Region.
21 This will be very brief, so you won't stretch your
22 necks.
23 3064 The logic of this is during the first
24 two weeks of March of 1998, Monday through Sunday,
25 taking each of the conventional channels available in
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1 this television market in English and giving you what's
2 on the air between 5:00 p.m. and midnight. I just want
3 to draw to your attention that the blue represents
4 local programming. So, you will see the competition
5 between local and local. Of course, some of the
6 channels, as a result of, if I could say, your
7 predecessor's policies come in, of course, with no
8 local programming whatsoever. You will also see on
9 that chart that the white boxes represent foreign
10 programming and the red boxes represent Canadian, but
11 non-local programming.
12 3065 What I wanted to highlight is that
13 Canadians are seeking out local programming. They are
14 continuing to do so. The choices are diminishing in
15 number, in variety and they are concentrated in two
16 off-prime time periods. Those data are available in
17 our handout today. They are the first two pages of a
18 number of charts and we have also made available to you
19 similar data for Halifax, Montreal, Winnipeg, Edmonton
20 and Vancouver. This is not some aberration in the
21 National Capital Region.
22 3066 Friends urges the Commission to make
23 the strengthening of local programming a high priority
24 and to focus on this issue in forthcoming licence
25 renewal hearings for CBC Television, CTV and the major
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1 station groups. The second message we have for you
2 concerns equitable financial contributions.
3 1125
4 3067 In the May 6 public notice, the
5 Commission stated that "most would appear to agree that
6 the regulatory framework should ensure that the
7 contributions of private conventional broadcasters to
8 Canadian programs are equitable". Friends is among the
9 "most" to whom you refer.
10 3068 We restate here our recommendation
11 first made to you at the conclusion of the third
12 Network Hearing last year that 33 per cent of on-air
13 revenues be adopted as a minimum threshold for major
14 station group spending on Canadian programming.
15 3069 We also support the recommendation of
16 others that within this, 7 per cent of on-air revenue
17 is an appropriate minimum threshold for spending on
18 under-represented categories. However, as we pointed
19 out in our June 30 comments, in order to respond
20 substantively to the important questions that you, the
21 Commission, posed in paragraphs 12 to 26 of the public
22 notice, Friends and other public interest groups need
23 to study aggregate information on existing spending on
24 Canadian programs by each of the major station groups.
25 3070 The next illustration I want to give
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1 you is on the chart to my right, but this is also
2 reproduced in the second last page of the handout that
3 we gave you this morning.
4 3071 This chart shows the revenues and the
5 program expenditures of the major station groups in
6 English language and French language conventional
7 television in this country. On May 6, and with minor
8 corrections on May 15, you released these data which we
9 have shadowed in blue.
10 3072 These data show, for example, that of
11 the total revenue of $1.7 billion of the conventional
12 television system, the spending on Cancon was $475
13 million or 28 per cent. That was the average for the
14 year ending August 31, 1997.
15 3073 Within that, by the way, the
16 conventional broadcasters as a whole spent just 5 per
17 cent of the revenues on the under-represented
18 categories, so the existing data for the system as a
19 whole is 28 per cent and within that 5 per cent for
20 under-represented.
21 3074 On August 5, the Commission released
22 further data which we have here shaded in red which
23 shows the major station groups program expenditures on
24 Cancon. From this data, these data in red, and from
25 other publicly available information, Friends has
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1 determined TVA, for example, spends fully 40 per cent
2 of its revenues on Canadian content, Baton spends 33,
3 WIC spends 30 and Canwest Global only 18.
4 3075 Without Canwest Global dragging down
5 this average, the other conventional broadcasters'
6 average Cancon investment exceeded 30 per cent last
7 year. If Canwest Global were spending at that level,
8 44 million new dollars would be available to finance
9 new Canadian programs each year.
10 3076 We are not surprised by Canwest
11 Global's failure to spend on Canadian programming.
12 It's a consistent pattern in their corporate behaviour,
13 but it is the Commission's responsibility to ensure
14 that major station group licensees make equitable
15 contributions to finance Canadian content and your
16 Commission has clearly failed until now to do so in the
17 case of Canwest Global.
18 3077 I noted that the Minister of Small
19 Business, Tourism and Recreation of British Columbia
20 appeared to agree with us in this regard last night.
21 3078 We also recommend in the strongest
22 terms that the Commission make public the data in each
23 of the blank boxes on this chart on a timely basis each
24 year, beginning now. Your public discussion with the
25 station groups in the coming weeks should be based on
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1 that information being available in public.
2 3079 Why is it so difficult to obtain
3 these data? We believe that someone is trying to
4 conceal something.
5 3080 The CAB brags that 60 per cent of its
6 members' programming is Canadian. If they claimed 61
7 per cent, we would congratulate them because that would
8 be 1 per cent more than the law requires.
9 3081 Consistently over the years the
10 conventional private broadcasters have turned floors
11 into ceilings. Their extreme reluctance to reveal
12 these data makes us even more sceptical when we listen
13 to their essential message at this hearing. "Trust
14 us", they said. Our message to you is "Trust, but
15 verify".
16 3082 Over many years, this Commission, the
17 CBC and the taxpayers have struggled to build a
18 presence for Canada in our audio-visual system. Your
19 challenge is to build on that achievement. After all
20 this work, it's no compliment that Homer Simpson is the
21 most accessible character in our English language
22 audio-visual system.
23 3083 En conclusion, Madame la Présidente,
24 nous vous demandons de souhaiter à Mme Bertrand un
25 prompt rétablissement et nos meilleurs voeux.
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1 3084 Nous attendons vos questions. Merci.
2 3085 THE CHAIRPERSON: Thank you, ladies
3 and gentlemen, Mr. Morrison.
4 3086 We understand, of course, the point
5 you are making. It has been made to us, as you pointed
6 out, in some of the town hall type meetings we had
7 across the country earlier, so I am not going to dwell
8 on that but rather look at the specifics of your
9 submission.
10 3087 I hope when you are talking about our
11 predecessors you don't mean the BBG because the
12 Commission is the Commission is the Commission. If you
13 criticize the Commission's judgment of before, it's
14 still the Commission. You don't mean the BBG, do you?
15 3088 MR. MORRISON: For the record, I
16 don't mean the BBG.
17 3089 THE CHAIRPERSON: I hope the
18 pagination won't be a confusion. I am using the
19 pagination at the top of your written submission where
20 it says "Public Notice CRTC98-44 page 10". Will that
21 be the same as your pagination?
22 3090 MR. MORRISON: I hope so, Madam
23 Chair.
24 3091 THE CHAIRPERSON: Let's check. There
25 is pagination from the faxing, I guess. I may not have
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1 the same copy. I am looking at your comments about
2 some of the causes of the loss of local and regional,
3 particularly local, programming in Ottawa, although you
4 have stated that in your view, Ottawa is not an
5 aberration.
6 3092 You say that the Commission's
7 balancing decisions among private players in Ontario
8 resulted in taking something away from Ontario viewers'
9 access to local programming.
10 3093 MR. MORRISON: Yes.
11 3094 THE CHAIRPERSON: We have the same
12 page?
13 3095 MR. MORRISON: Yes.
14 3096 THE CHAIRPERSON: If you look at
15 Ottawa, I'm curious as to what you mean by that. If
16 your conclusion is that local programming is popular,
17 couldn't one argue that by allowing further stations in
18 who do not have local programming as it relates to
19 Ottawa, but have Hamilton or Toronto programming, that
20 the result would be for Global in Ottawa to do even
21 more or more relevant local regional programming, not
22 less, since the other stations don't offer it, that to
23 distinguish itself and to make itself more popular, the
24 result of our decision on the face of it would seem to
25 me from a market perspective even to understand that
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1 dropping the local programming may make them more
2 vulnerable, or is it because you haven't given Baton
3 the results of your surveys?
4 3097 How do you reconcile this?
5 3098 MR. MORRISON: You will see no blue
6 on the chart opposite Global in Ottawa because Global
7 operates from a common base in south-central Ontario,
8 the Toronto market, a channel which your Commission --
9 we won't go into the line about your predecessors,
10 Madam Chair -- has authorized to be distributed in
11 markets throughout the province of Ontario.
12 3099 As a result, Global, and this applies
13 to WIC's channel as well, enter the Ottawa market
14 without any local obligations or any substantial local
15 programming whatsoever.
16 3100 That places stations like CJOH at a
17 competitive disadvantage as it would other Baton
18 stations in other parts of Ontario who are trying to
19 serve local markets, like Sault Ste. Marie, Sudbury,
20 where the principal competition from other conventional
21 broadcasters is coming from a single stick operation in
22 the Toronto-Hamilton area.
23 3101 THE CHAIRPERSON: So when you talk
24 about the Commission's balancing decisions, you are
25 talking about the seventies when Global was licensed
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1 more than the permission given to the other
2 participants here who do not provide local programming
3 to enter the Ottawa markets since this is Ottawa.
4 3102 MR. MORRISON: Global was licensed in
5 1972 and it was the first time the Commission gave what
6 they called a regional licence.
7 3103 Our concern is about the presence of
8 local programming, so the decision to allow Global and
9 then WIC, these are 1990 decisions, to extend their
10 territory throughout Ontario without any corresponding
11 obligation to program locally by the very nature of it,
12 it's a distant signal, has undermined in our view local
13 programming throughout the province of Ontario.
14 3104 THE CHAIRPERSON: How does that
15 answer my question as to why that would have the effect
16 on CTV, who was already in the market everywhere in
17 Ontario, to reduce its local and regional programming
18 if it's popular and is able to generate funds.
19 3105 Are you saying that the competition
20 was such that CTV or Baton was put in a position, since
21 that's what we are talking about particularly here,
22 where it had to do the same thing as these services
23 because they were doing it and making money out of it
24 and it made them move away from being different rather
25 than emphasizing it?
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1 3106 MR. MORRISON: Yes. The cheapest
2 type of programming, of course, is imported programming
3 from the United States. If a major station group runs
4 it on all its stations at the same time, that's the
5 lowest expenditure to fill that time. More expensive
6 is any type of Canadian programming, even distant
7 programming, and still more expensive is to have all of
8 your 10 or 20 stations programming at the same time
9 their own programs.
10 3107 Inherently it is the case that local
11 programming is popular, but it is also relatively
12 expensive when it is averaged over the whole station
13 group's efforts.
14 3108 You have given a substantial
15 advantage to WIC and to Global by -- your predecessors
16 have -- by allowing them access --
17 3109 THE CHAIRPERSON: The BBG, of course.
18 3110 MR. MORRISON: Yes. -- the entire
19 market of 10 million or 11 million people from a single
20 source where their competitor was operating a series of
21 independent stations, but as to the details, ask the
22 competitor.
23 3111 We noted with a great deal of
24 interest the heartfelt recommendation from some
25 gentleman from CJOH who said at the end of his
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1 representation "I hope I don't lose my job over this"
2 about what is happening to the availability of local
3 shows in Ottawa.
4 3112 I would also commend your attention
5 to a quite incisive article by Tony Atherton in the
6 Ottawa Citizen. I think we refer to it in our brief.
7 3113 THE CHAIRPERSON: Yes. I have read
8 it. We will come back to that.
9 3114 You focus on this page on the Ontario
10 situation. We have the Ottawa evening schedule before
11 us. You said in your remarks that that is not an
12 aberration. What causes it in other areas, causes the
13 moving away from?
14 3115 Is it because the same owners have
15 these stations and other markets because the Global
16 situation that you are focusing on does not necessarily
17 repeat itself in the same manner across the country?
18 3116 If this is not an aberration,
19 although it is an illustration of the problem, what
20 causes it in other markets?
21 3117 MR. MORRISON: I would urge you to
22 retain that question and to pose it to people who have
23 a direct fiduciary interest for programming.
24 3118 THE CHAIRPERSON: You mean the
25 licensees themselves.
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1 3119 MR. MORRISON: Yes, starting with WIC
2 this afternoon. Okay?
3 3120 We have attached to the document
4 which we handed here today data which parallels the
5 data on that wall for seven cities. I have mentioned
6 them.
7 3121 THE CHAIRPERSON: Yes. I am asking
8 you what the cause is there since you have identified
9 one, particularly in Ontario, that illustrates it. You
10 blame it on our decisions to allow early in the
11 seventies and in the nineties further importation of
12 signals that do not carry local programming and in your
13 view has a domino effect on the broadcasters. What
14 happens in the other markets?
15 3122 MR. MORRISON: I am delighted to
16 respond on the issue of why, that is the causes of it,
17 but I would like to say that I think the important
18 thing is for groups like the Friends and for your
19 Commission to address that question very seriously.
20 3123 What we have presented here today is
21 not an explanation of why it has happened, but
22 objective, substantive evidence that it is happening.
23 We have used the Winnipeg market to do that and
24 everything that my colleague, Arlan, has said here is a
25 summary of several months work that has made that case.
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1 3124 To move from what has happened to why
2 it has happened in markets throughout the country and
3 to leave aside -- well, Global in fact is present in
4 most of these markets, except until the near future
5 probably in Alberta.
6 3125 What we imagine, and I am I guess
7 repeating, is that it is the hierarchy of expense of
8 local programming over national programming over
9 American programming. Without strong conditions of
10 licence from this Commission, we have witnessed a slow
11 and steady reduction, diminution, to the availability
12 of local programming.
13 3126 You heard this morning from the
14 Saskatchewan Public Broadcaster a quite passionate
15 statement about the results in Saskatchewan. We have
16 no Saskatchewan data to give you. I noticed Maggie
17 Siggins nodding when they spoke.
18 3127 It is not so much that we have the
19 answer, Madam Chair. It is rather that we think it's a
20 fundamental question and we are asking you to consider
21 the defence of local programming as a prime
22 responsibility for this Commission in its new
23 television policy.
24 3128 THE CHAIRPERSON: Oh, yes, I
25 understand that. Its just that you are here, you have
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1 done some research and you have focused on the problem,
2 so I don't think it's in any way surprising that we
3 would like to discuss with you what you think are the
4 causes of that which would presumably help in resolving
5 the results you put before us because that's not the
6 most difficult thing to do, to expose the results, but
7 to then look at the causes of it is the only thing that
8 would lead one to find mechanisms to correct it.
9 3129 You would obviously have a great
10 concern with the proposition of the CAB which is to
11 emphasize prime time in certain categories of
12 programming because you would have a concern, I assume,
13 that that would be at the expense of -- would just
14 reinforce what seems to be happening.
15 3130 Even if that would go some ways into
16 producing more Canadian content, which is usually red
17 in other charts, your concern, which we appreciate
18 because it has been made by other parties and is a
19 concern, is to add some blue in there.
20 3131 MR. MORRISON: If you look hard at
21 that, you will see just about no blue in what we call
22 prime time, what the FCC calls prime time and what you
23 would call the centre of peak viewing hours.
24 3132 The only, I think, exception is a
25 short program that is aired by the CBC called "On the
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1 Road" on Friday nights, but it's really a network
2 program that happens to come out of Ottawa, so you have
3 no local programming at times when people are most
4 likely to be watching in this market.
5 3133 I would like to relate that back to
6 the financial side, if I may.
7 3134 THE CHAIRPERSON: Yes.
8 3135 MR. MORRISON: That is to say if we
9 knew, and press reports indicate that as senior people
10 in our broadcasting system as Mr. Asper have said that
11 there are reasons for Global spending so little. If we
12 knew what all the station groups were spending on the
13 various categories that are outlined on the chart
14 behind us, we could have an intelligent discussion
15 about the reasons.
16 3136 We know that you know that
17 information because you need it in order to get the
18 aggregate. We know that they know that information but
19 we, and I think I could say the other 30 million
20 Canadians, do not have that information. We would have
21 a much more intelligent discussion about news,
22 spending, spending on under-represented categories,
23 everything, if that information were on the table.
24 3137 THE CHAIRPERSON: Yes. It would be
25 more informative, but we wouldn't be able to have the
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1 very dramatic comparisons that are made without the
2 reasons why, which we will go into, I suspect.
3 3138 Right now what is the comparison that
4 you are making is the strict percentage of expenditures
5 without looking into who spends on what category and
6 what returns, et cetera, because you feel you don't
7 have the data that is sufficient.
8 3139 MR. MORRISON: Well, it's not a
9 feeling. It's actually not on the table. We and about
10 20 other organizations who went through the formal
11 process asked you for the data. We feel we need it to
12 intelligently comment on the questions.
13 3140 For example, I am just looking at the
14 issue of one to five information programming. It would
15 be wonderful to know what Baton and Global and CHUM are
16 spending on that or what they are spending on seven to
17 nine, but the information is not in the public domain.
18 We don't see a public policy reason to withhold it.
19 1145
20 3141 THE CHAIRPERSON: And I presume you
21 would also want to know what revenues flow from each
22 category you spend it on to have a complete picture?
23 3142 MR. MORRISON: Yes. In some ways
24 that is part of the CAB's spin, which is that they want
25 Canadian programming to be profitable, maybe. I have
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1 nothing against Canadian programming being profitable,
2 but since the dawn of the broadcasting age and the age
3 of television there has been a certain cross-subsidy of
4 profits from lower cost American programming into
5 Canadian programming.
6 3143 So, the CAB effort in the press
7 release that you made public -- the facts that you made
8 public on August 5 to position the Canadian spending in
9 relation to the revenues derived from those programs
10 obscures the larger picture which we put before you in
11 terms of their effort related to their total capacity,
12 their total on-air revenue and other revenue.
13 3144 THE CHAIRPERSON: Now, solutions.
14 You know that now we have quantitative commitments for
15 the broadcasting local news programming and you would
16 want, I suspect for at least that as a minimum, to be
17 maintained for services that are anchored in the market
18 concerned?
19 3145 MR. MORRISON: Yes. We are not here
20 demanding Fraser Institute like deregulation, Madam
21 Chair. Appropriate regulation is necessary.
22 3146 Nor are we in a position to really
23 tell you exactly how to do your job. It's a broken
24 record perhaps, but I on Friends' behalf have often
25 said that we trust the judgment of the Commission. Our
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1 role we feel is to try to draw certain subjects to your
2 attention, so that they get a little larger share of
3 mind in your attention. This local issue is going to
4 require a lot of thought.
5 3147 THE CHAIRPERSON: In your examination
6 of this problem that you perceive and that is
7 illustrated on this chart, do you make a difference
8 between regional and local programming?
9 3148 MR. MORRISON: Yes, of course, but I
10 am reminded of a comment by one of the people who
11 preceded you in that chair, Pierre Juneau, who at the
12 time of huge cuts to the CBC six or seven years ago --
13 3149 THE CHAIRPERSON: You are trying to
14 intimidate me.
15 3150 MR. MORRISON: I look forward to some
16 day when we can say that are quoting Madam Wylie.
17 3151 In any case, he said once, "Who can
18 say that southern Alberta is not a region," when the
19 CBC decided that they would turn region into province,
20 six or seven years ago as a way to try to deal with
21 budget problems.
22 3152 No one in this country can understand
23 the meaning of the word "region" as it exists in the
24 statute books of this country, could think that the
25 province of Ontario, for example, is a region. Eastern
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1 Ontario is a region. The Golden Horseshoe is a region.
2 The Greater Winnipeg area is a region.
3 3153 So, we would not accept for a moment
4 the notion that regional equals something like the 11
5 million people who happen to live in Ontario and
6 certainly not the seven point something million people
7 who happen to live in Quebec.
8 3154 THE CHAIRPERSON: One of the reasons
9 I am pointing this out is you mention the CBC's
10 legislative mandate and it does not refer to local. It
11 refers to regional. But you feel that the private
12 sector's responsibility for local-local programming is
13 greater, you would agree with that and that
14 regionalization by the CBC is perhaps a little more in
15 tune with their mandate, although it does carry
16 problems as well, which obviously will be looked at.
17 3155 MR. MORRISON: Everything we have
18 said about local with regard to the CBC applies to
19 regional with regard to the CBC, by any reasonable
20 understanding of the word "regional."
21 3156 I would just point out to you that
22 turning that around and to say if, as you have, the
23 responsibility to try to interpret Parliament's goals
24 into active public policy, the instruments at your
25 disposal to provide incentives and the variety of
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1 things you do, the private conventional television
2 stations are your most powerful instrument there and it
3 is where the lion's share of your attention, in our
4 view, should be directed.
5 3157 THE CHAIRPERSON: What is your view
6 as to whether intervention by the regulator could
7 possibly bring some solution to the problem you
8 perceive without preventing the greater concentration
9 of the players and allowing more competition among the
10 large parties in one market, and this is a good
11 example. Do you think there is something inherently
12 wrong with that if you could intrude from a regulatory
13 perspective and ensure by this intrusion the
14 responsibility of the local broadcaster to provide
15 local programming?
16 3158 MR. MORRISON: My colleagues on the
17 Friends' steering committee as a matter of policy
18 decided that it was far beyond the capacity of
19 ourselves or perhaps yourself to prevent concentration
20 in the broadcasting system. Instead, our goal --
21 3159 THE CHAIRPERSON: Is that what you
22 think?
23 3160 MR. MORRISON: Instead, our goal is
24 to make the concentrators pay. In other words, those
25 to whom much has been given --
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1 3161 THE CHAIRPERSON: Our significant
2 benefits test.
3 3162 MR. MORRISON: Well, someone said
4 that that sounded a little bit of Karl Marx, but as you
5 see we were quoting St. Luke in this brief.
6 3163 Having said that and recognizing that
7 some type of restructuring in the system is inevitable,
8 that very restructuring provides you because of the
9 immense power and authority that your Commission has
10 under the Broadcasting Act and you can pick the verb,
11 supply the one you want, but I would say extract
12 certain commitments from concentrators.
13 3164 It is not so much a question of the
14 diversity of voices, provided you maintain, and we
15 think it is a key thing, the one station per language
16 per market policy. It is rather a question of
17 providing -- we trust your discretion -- a mixture of
18 incentives, expectations, conditions to ensure that the
19 phenomenon that we and so many others are bringing to
20 your attention is addressed.
21 3165 By the way, in your agenda, I suppose
22 it's possible, people have speculated that WIC on the
23 chopping block will come to your attention before the
24 CBC hearing, but those are the two first opportunities
25 you are going to have to address this specifically. We
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1 very strongly urge you not to let the CBC off the hook.
2 3166 THE CHAIRPERSON: I hope you will be
3 watching.
4 3167 Would it be fair to say that one of
5 your concerns is that as we allow concentration and we
6 extract benefits from it, that we be very careful not
7 to demand so much in the so-called underrepresented
8 categories of drama, et cetera, which is not really
9 local and regional programming generally, that all
10 monies are spent in that area through regulatory
11 requirements and are taken away from local and
12 regional, which is something that has been expressed to
13 us if we ask during the town hall meetings what is your
14 concern. The concern is there. If there is too much
15 demand on that side.
16 3168 So you see this as a balancing act
17 that the Commission has to do to respond since your
18 organization, like many others, is alarmed by the lack
19 of high level or drama type of programming which is
20 mostly American. We want the production of that. We
21 need financial strength and monies spent to replace
22 that, but we also have to balance against that not
23 dropping the local and regional reflection on the
24 airwaves. Would that be fair?
25 3169 MR. MORRISON: It would and your
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1 question brings up several things on which I would like
2 to comment briefly.
3 3170 THE CHAIRPERSON: Yes.
4 3171 MR. MORRISON: One is around the
5 local and regional dimension of underrepresented. I
6 would like to draw to your attention, I hope the pages
7 are the same, but page 25 of our brief to you contains
8 a graphic which shows the hours of Canadian drama,
9 music and variety programs available weekly on Winnipeg
10 conventional television stations.
11 3172 THE CHAIRPERSON: Except yours is in
12 colour?
13 3173 MR. MORRISON: No.
14 3174 THE CHAIRPERSON: No, it's not?
15 3175 MR. MORRISON: This is in the brief
16 that was submitted.
17 3176 THE CHAIRPERSON: Mine is
18 photocopied. I have the same limitations as you.
19 3177 MR. MORRISON: Yes.
20 3178 I am just drawing to your attention
21 that there is a huge amount of different stuff under
22 drama, music and variety. Arlan found in the research
23 that he undertook on our behalf, which was quite
24 thorough and exhaustive, that there used to be a
25 certain amount of underrepresented programming
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1 available in the Winnipeg area in 1986, but almost not
2 any longer the case.
3 3179 We also want to draw to your
4 attention just by tracking what those four Winnipeg
5 stations did during a six-week period of 1997-98 -- I
6 think that's this particular chart, Arlan -- that some
7 underrepresented categories are more underrepresented
8 than others.
9 3180 So have said that, we think that the
10 best measure of effort by station groups on the under-
11 represented categories is money. So, we have noted
12 what the CFTPA said to you and we have read most of the
13 briefs and, in fact, even tried to analyze them. We
14 note that there is a substantial body of opinion that
15 agrees with us.
16 3181 Indeed, we took the advice from
17 others, that one thing you could do would be to track
18 the performance of the station groups and I bring you
19 back to this chart. It would just be a question of
20 knowing what the total line for revenue is and then
21 applying it to 7, 8, 9, if those data that you know and
22 they know were available to the rest of Canada. We
23 still think that that 7 per cent figure is a realistic
24 target and we would like to put it before you.
25 3182 It does compete with local
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1 programming. We don't think it is more important than
2 local programming or we would not have led with the
3 local programming. We think local programming is the
4 biggest threat in the English language television
5 system right now.
6 3183 THE CHAIRPERSON: Mr. Gates, on that
7 page, page 25, how do these stations in Winnipeg, in
8 your view -- take the private stations -- how do they
9 meet their 60/50 requirement? It is not showing a
10 whole lot of the underrepresented categories either and
11 I think your research has shown that there is not a lot
12 of local programming either. If you assume that they
13 are in compliance, what is your general view as to how
14 they meet their Canadian content of 60 overall and 50
15 during prime time or six o'clock?
16 3184 MR. GATES: They do this in a couple
17 of ways and without getting into extensive detail you
18 see in the appendices to the report we provide numbers
19 that should flesh this out, but just in embryo to
20 respond to your question.
21 3185 THE CHAIRPERSON: Like your general
22 view because you must have one.
23 3186 MR. GATES: The general view is that
24 there is a fair amount of the evening broadcast period
25 requirements covered by local news, some of which is
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1 repeated, some of which is original broadcast and
2 during the rest of the day there is some rebroadcast of
3 that news and then you also find a fairly large
4 selection of Canadian content in times that may be
5 appropriate for certain types of programming, but not
6 necessarily at the time of day when the most viewers
7 are watching.
8 3187 I would cite children's programs
9 coming early in the morning and other types of
10 programming, talk shows, soap operas coming in the
11 afternoon.
12 3188 MR. MORRISON: Could I supplement by
13 just drawing your attention, Madam Chair, to the pages
14 on Winnipeg, the colour charts which respond to the
15 Ottawa charts because we have great detail on the
16 Winnipeg market. We picked it because we felt it was
17 in many ways representative of a lot of -- I have even
18 been able to get away with that statement in Edmonton.
19 People nodded and said, "Yes, I suppose Winnipeg might
20 be representative."
21 3189 But if you were to look at the four
22 conventional channels in Winnipeg, again not letting
23 the CBC off the hook, you can do some counting and it
24 is rather interesting. For example, let's take CKY.
25 3190 CKY, as you know, is currently
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1 affiliated during the 40-hour time period with CTV, but
2 it is not to my knowledge a Baton station. Just look
3 at the 7:00 to 11:00 period there and count. In 1998
4 in the first two weeks of March, I am looking at the
5 red programs and I see one, two, three, four hours and
6 then five and a half, including that local material in
7 prime time out of 28. So, five and a half hours of
8 that station's 7:00 to 11:00 programming is Canadian in
9 the first two weeks of March of last year. Therefore,
10 22.5 hours is foreign.
11 3191 So, I am not accusing them of not
12 meeting the 60/50 rule, but we understand a lot of
13 techniques that stations use. I am sure your staff can
14 give you an exhaustive briefing on it. One, you load
15 up in the summertime when audiences are smaller. Two,
16 you take advantage of every opportunity with 150 per
17 cent, et cetera, which adjusts your percentages and the
18 end result is that you typically have and that CKY
19 first two weeks of March is completely typical of what
20 we have seen on the Baton stations and indeed on the
21 Global stations. We don't see much difference between
22 them in prime time.
23 3192 I am told by my friends at Global
24 that some of the data the CBC gave you yesterday
25 understated their contribution this current autumn. I
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1 am looking forward to seeing their correction of that.
2 3193 THE CHAIRPERSON: I know, Mr.
3 Morrison, you always say you are exposing the problem
4 and we are supposed to solve it, but you do have some
5 particular comments. So I will use that as an excuse
6 for asking you particular questions.
7 3194 One very specific comment is, for
8 example, that there should be a 200 per cent drama
9 credit for drama exhibited between 8:00 and 10:00, so a
10 much shorter peak-peak time. I notice that this
11 perceived problem of loading in the months that are not
12 heavy viewer would be corrected by only giving this
13 credit between October and March. So, it is a very
14 specific comment that would result in Canadian drama
15 being aired in the peak-peak hours.
16 3195 MR. MORRISON: If I could
17 parenthetically just say you should file that more as a
18 suggestion than a specific recommendation because you
19 have greater capacity to examine the effects of all of
20 these things and you might detect some reason that that
21 particular proposal should not be implemented. It is
22 an example of the kind of thing that may be needed to
23 address the question.
24 3196 We don't support the idea of a 500
25 per cent credit that some people have --
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1 3197 THE CHAIRPERSON: No, no. It's a
2 suggestion from you. It's an excuse for me to pick
3 something recommended that is very specific to try to
4 ask you more specific questions about how you solve the
5 problem you have outlined.
6 3198 You focus on spending and that there
7 should be 33 per cent of revenues spent on Canadian
8 content.
9 3199 MR. MORRISON: At least.
10 3200 THE CHAIRPERSON: Of which -- yes.
11 So, rather than floors and ceilings, you would like a
12 split level at least?
13 3201 MR. MORRISON: Well, call it a floor,
14 if you want to use the image.
15 3202 THE CHAIRPERSON: Floor and ceiling.
16 What did I say?
17 3203 MR. MORRISON: You said -- I'm sorry,
18 the record will know what you said. What I was trying
19 to suggest was that the word "floor" is an appropriate
20 synonym for our word "threshold."
21 3204 THE CHAIRPERSON: Yes, yes, but the
22 split level would presumably drive you above the floor?
23 3205 MR. MORRISON: Yes.
24 3206 THE CHAIRPERSON: You suggest 33 per
25 cent, of which 7 per cent on the underrepresented
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1 categories. Are you envisaging this retaining the type
2 of regulatory direction we have at the moment where
3 there are exhibition requirements, spending
4 requirements, the 60/50 formula and some perhaps --
5 3207 MR. MORRISON: The options?
6 3208 THE CHAIRPERSON: -- more particular
7 focus on demanding local programming, or are you
8 thinking of a complete revision of the way Canadian
9 content is regulated?
10 3209 MR. MORRISON: We read your Public
11 Notice, your May 6 Public Notice, in the context of
12 your September 1997 Vision document and we note that
13 this is the first time since the early 1980s when you
14 have taken such a catholic comprehensive look at
15 television policy. So, as a preliminary response I
16 would say if you are ever to take a look at what are
17 appropriate rules, incentives, the package, now is the
18 time and you have certainly stated in the agenda that
19 it is within the purview of your concern.
20 3210 So having said that, we have observed
21 over a long period of time, with I am sure some
22 significant but limited exceptions, that the private
23 conventional television industry has never yet done
24 anything substantially more than what you required of
25 them for Canada.
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1 3211 So, times may change when they may
2 have a strong incentive to do that and I have heard
3 some of their leaders say that this is their business
4 plan. We would, as Hamlet says, "so have I heard and
5 do in part believe." It's a question of degree, but
6 our strong advice to you is you ought to take a look at
7 other models now.
8 3212 You were listening in detail to the
9 CAB model and you, in my judgment, exposed through your
10 questioning certain limitations to the ethicality of
11 what they proposed.
12 1205
13 3213 We think that spending is an
14 appropriate indicator. In other words, you have to be
15 concerned with the inputs. You cannot be concerned
16 only with the outputs for the system. It's just not on
17 and, as you pointed out yesterday, it's not consistent
18 with the Broadcasting Act.
19 3214 THE CHAIRPERSON: I think that the
20 only focus on any recommendation you made that has to
21 do with scheduling is the credit. To resolve the
22 problem, you have outlined that the Commission would
23 make recommendations that would go beyond spending and
24 also be directed to exhibitions. You made the point
25 that local programming is not even anything that
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1 resembles even shoulder time in many cases, if there is
2 any. So, would you find it important that exhibition
3 be also focused on?
4 3215 MR. MORRISON: Yes. I think that if
5 I were you, I would think that in the policy statement
6 that is the output of this hearing you should be
7 establishing the framework for a series of conditions
8 of licence and expectations that would be negotiated,
9 extracted, the appropriate verb, from the major players
10 as they come before you in a cycle which will evolve in
11 the next year or two. We hesitate to try to pound the
12 table and say it should be done exactly this way. We
13 would be very pleased to accept your leadership and
14 hope that you would accept the judgment that we and a
15 lot of other public interest groups have put before you
16 about the problems that need to be addressed.
17 3216 THE CHAIRPERSON: You have already
18 expressed the view that there isn't something
19 inherently problematic with concentration -- am I
20 correct -- or even vertical integration from looking at
21 page 35 of your presentation and your views on allowing
22 broadcasters to have access to funds and to make
23 distributors advances and I think you talk about an
24 out-moded view of the dangers inherent in that.
25 3217 I gather from that that
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1 concentration, vertical integration, none of that is a
2 problem -- I do think you say in some circumstances
3 there should be safeguards -- as long as the result of
4 that goes to improving what is offered to the public
5 and, in your view, it must include local regional
6 programming as well, but that if the result with
7 regulatory intervention is to get more out of the
8 bigger parties, then you have no problem with
9 concentration or even vertical integration.
10 3218 MR. MORRISON: One image that comes
11 to mind is of King Canute ordering the sea not to rise.
12 3219 THE CHAIRPERSON: That's not our
13 predecessor.
14 3220 MR. MORRISON: So, there are forces
15 at work that are substantial forces and maybe beyond
16 your or our control around restructuring in the
17 Canadian audio-visual industry. Some of those things
18 can bring positive benefits and negative benefits and
19 one of your roles is to try to steer towards the
20 positive and away from the negative. Obviously, if I
21 were inside your boardroom, that would be what I would
22 be saying to you.
23 3221 So, it is not so much that
24 concentration is good or bad, it is, rather, that as
25 concentration takes place, you are uniquely well placed
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1 to ensure that the concentrators pay something back to
2 the broadcasting system and it is an opportunity not to
3 be squandered. It is the same with vertical
4 integration. It is not necessarily a bad thing and
5 some of it may strengthen the broadcasting system, but
6 it is precisely in your question -- to evaluate it, it
7 is neither good nor bad. It is what it does back to
8 your purposes and goals.
9 3222 To give an example -- otherwise, I
10 would be inconsistent with other documents we filed
11 before you -- vertical integration between big cable
12 and specialty channels, in our judgment, in a limited
13 capacity system, is a very bad thing. I would commend
14 you for the Sportscope decision, by the way, which
15 seemed, in our judgment, to recognize that there are
16 inherent problems in vertical integration.
17 3223 But in the broadcasting industry,
18 with respect to the other part of your question which
19 related to treating broadcasters in a manner that is
20 more consistent with the way that independent producers
21 are treated, recognizing that some of that is beyond
22 your immediate jurisdiction, you have a voice to be
23 heard.
24 3224 I think we used the example in a pre-
25 Atlantis Alliance age of June 30th pointing out to you
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1 that, in our view, as we have been advised, if Baton
2 Broadcasting were to come along and through a stock
3 swap acquire Alliance, all of a sudden the Alliance
4 structure of companies would be prevented from
5 accessing certain Telefilm funds, but if Alliance
6 Communications came along through a stock swap and
7 acquired Baton Broadcasting, everything would continue
8 as usual. We didn't like that very much.
9 3225 THE CHAIRPERSON: So, mainly that the
10 rules wouldn't be adjusted.
11 3226 MR. MORRISON: Yes, and those rules
12 are under the influence of the Telefilm people.
13 3227 THE CHAIRPERSON: Or that even the
14 swaps would be acceptable.
15 3228 MR. MORRISON: Yes. Am I answering
16 your question? I hope so a little bit.
17 3229 THE CHAIRPERSON: Sorry to interrupt.
18 3230 MR. MORRISON: I am happy to stop. I
19 have seen a few other witnesses who did not answer your
20 questions, Madam Chair, and I don't want to be among
21 them.
22 3231 THE CHAIRPERSON: You not suggesting
23 I didn't notice?
24 3232 MR. MORRISON: Well, once when you
25 asked the same question ten times, I thought they might
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1 have gotten the hint.
2 3233 THE CHAIRPERSON: What you are
3 saying, obviously, is vertical integration, if it's
4 properly managed and gets the result that we want --
5 some people have emphasized under-represented
6 categories, you are emphasizing local regional
7 programming as well -- can be managed. Other types of
8 vertical integration, you seem to think that any
9 advantage that could flow from it you would agree over-
10 balances the disadvantages when they are weighed, one
11 against the other.
12 3234 MR. MORRISON: And you can count on
13 us and they can count on us being back here when you
14 consider matters on a case-by-case basis to express our
15 views in detail.
16 3235 THE CHAIRPERSON: My colleagues may
17 have some questions, but these are my questions, unless
18 you have something else to admonish us about before
19 leaving. We certainly appreciate the amount of work
20 that has been put into this. It is very helpful. We
21 urge you to remain friends of the Commission, as well
22 as of the industry.
23 3236 MR. MORRISON: I personally, as our
24 spokesperson, am not at liberty to not be a friend of
25 the Commission because again the Steering Committee, as
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1 a matter of policy, said that defending the role of the
2 CRTC is critical to our vision of the future audio-
3 visual environment that we want to see happen.
4 3237 THE CHAIRPERSON: So, it's an imposed
5 friendship, not a chosen one. It's okay.
6 3238 MR. MORRISON: Imposed by them.
7 3239 THE CHAIRPERSON: Commissioner
8 Cardozo.
9 3240 COMMISSIONER CARDOZO: Thanks. For
10 those who think that we are running out of things to
11 do, we need friends like that, I suppose.
12 3241 I have a question for Professor
13 Golfman and Ms Siggins, the English majors on your
14 panel, and the other two maybe as well, but you didn't
15 tell us.
16 3242 THE CHAIRPERSON: You are not talking
17 about my grammar, I hope.
18 3243 MR. MORRISON: This one talks about
19 it and this one does it.
20 3244 COMMISSIONER CARDOZO: It goes to the
21 issue of the sources of raw material for Canadian
22 programming. My observation over the last decade or
23 two has been that we have had an immense explosion of
24 very high-quality Canadian literature, fiction and non-
25 fiction, and it grows. It reflects the culture and
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1 people very well, it reflects regions quite well. In
2 some of the work you have done, Ms Siggins, some of the
3 issues you have covered recently reflects the diversity
4 of people, of dreams, of visions, that sort of stuff.
5 3245 I am just wondering whether you would
6 agree with that -- you are nodding, so I assume you
7 agree with that -- about whether you think there is
8 enough crossover between Canadian literature and
9 programming, whether there should be. I am not
10 suggesting that all novels or written works should
11 become TV movies, but are we seeing a lot of what is
12 written on TV and is there enough other sorts of
13 coverage of Canadian literature, whether it's
14 interviews with authors and coverage of literary
15 conferences and those sorts of things?
16 3246 MS SIGGINS: Many of us feel that one
17 of the reasons that we can have three meals a day these
18 days is that so many of the novels and non-fiction
19 works are, first of all, being optioned and, secondly,
20 produced by independent producers. I will just think
21 of two. In my province the very famous Guy Vanderhague
22 novel that won the Governor General's Award that I
23 think is a wonderful reflection is now in the process
24 of being made into a movie and he is writing the
25 script. Now, how far he will get with that I'm not
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1 sure, but, yes, I feel that there really is a wonderful
2 thing happening there.
3 3247 The problem is, of course, that it's
4 hard for prose writers to switch over into television
5 and film writing and that, of course, is where the real
6 money is. So, that's a process that has to -- and
7 that, of course, is also in the documentary area, too.
8 It's very hard to find documentary writers where I come
9 from because there still is a bit of a stigma about a
10 good prose writer not wanting to work for this thing
11 called television even though the money is very good.
12 3248 But I think it is very slowly
13 happening and the more that it happens, in my mind, the
14 more you are going to get really good quality Canadian
15 programming.
16 3249 MS GOLFMAN: I would just extend in
17 some ways the question and the answer to a
18 consideration of the cultural vitality in general,
19 cultural practices in the regions. Writing is the
20 obvious. Institutionalized writing, writing that
21 sells, clearly in the last, I would say, even 20 years
22 has become an accepted vital aspect of our national
23 health. The same is increasingly true for film
24 production, but I would say that it would be important
25 to think outside of those economically accepted
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1 categories as well and think about the local theatrical
2 productions.
3 3250 I am living in a culture that has
4 perhaps a disproportionately high creative output, some
5 of which is now travelling beyond the island's borders.
6 There is so much evidence at the local for creative
7 possibility and I guess what we are arguing in general
8 -- and your question in some ways presumes it -- is
9 that we need the avenues to have those cultural
10 expressions expressed more widely.
11 3251 So, I would say it's healthy to think
12 in terms of literature and literary production
13 certainly when it is being internationally recognized
14 these days, but we need not to just limit to so-called
15 high art, I think, considerations or more traditional
16 considerations of culture. It's important to think
17 more broadly as well.
18 3252 COMMISSIONER CARDOZO: Do you think
19 that broadcast media or production gives enough
20 coverage to Canadian literature talking to authors? I
21 am thinking of the kinds of shows you get on
22 entertainment out of the U.S. or elsewhere. I think
23 you see a lot more in the French media in Quebec where
24 there are entertainment shows where you see a lot of
25 artists and writers being interviewed, the star system.
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1 Does that happen here enough?
2 3253 MS SIGGINS: Not very much at all and
3 I never can figure out why because a lot of writers and
4 artists are so entertaining. There are few people in
5 society that still have some individuality perhaps, but
6 not nearly enough. I think that it's partly what has
7 been expressed, that we think of literature somehow as
8 a high art and that ordinary people wouldn't be
9 interested. If you look at the number of Canadian
10 novels that are bought every year for your grandmother
11 and your aunt, this always astounds me. But, no, I
12 don't think, of course, that there is nearly enough
13 programs related to the arts.
14 3254 COMMISSIONER CARDOZO: Thank you.
15 3255 Thank you, Madam Chair.
16 3256 THE CHAIRPERSON: Not only aunts and
17 grandmothers read those novels, I hope, because there
18 aren't that many aunts and grandmothers.
19 3257 I have thought of one other question.
20 In looking at this lack of local and regional
21 programming problem, do you have a view as to whether
22 other means may begin to be used to fulfil that
23 requirement, such as the Internet or perhaps regional
24 specialized services like Pulse24 for news in the
25 Toronto area, that in the future the satisfaction of
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1 this demand may be made in that way as well?
2 3258 MR. MORRISON: That's a very good
3 question and it's a very important question, one of the
4 reasons I think we shared with you -- we certainly
5 shared with journalists -- an analysis of many of the
6 briefs that you have received according to ten topics
7 that we thought were important in 75 interventions.
8 Topic number two, which was largely not addressed by
9 the intervenors, was the question of the community
10 channel and the cable system.
11 3259 So, I take your question as an
12 opportunity to say -- if memory serves, Madam Vice-
13 Chair, you were in Vancouver --
14 3260 THE CHAIRPERSON: Yes, and that is an
15 intervention when you say intervenors didn't address
16 that. What you heard in those regional town hall
17 meetings are interventions and they are part of the
18 record.
19 3261 MR. MORRISON: I am glad to hear that
20 and I believed that to be the case. I wanted to add
21 that I was not present, but it was reported to me by
22 people I trust that quite a bit of the time at your
23 five-hour session in Vancouver was devoted to issues
24 around the community channel, in particular I think the
25 Rogers community channel in Vancouver. We have in our
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1 brief referred to the fact that we believe it to be one
2 of the best of community channels. By the way, it's
3 the first time I can think of this decade that I have
4 ever said anything about Rogers in this room that was
5 positive.
6 3262 What I wanted to say to you, however,
7 is that we have examined the community channel in many
8 parts of the country as part of our ongoing effort and
9 we think it is a valuable service. We see certain
10 threats to its local origination, particularly some
11 policies of Shaw Communications that we are keeping a
12 close eye on, but I would just like to -- maybe it's
13 too strong a word -- insist that, in our view, the
14 cable company community channel is no way an adequate
15 response to the threat that we have shown you. Even at
16 its best, it provides insufficient reflection of the
17 life and the issues of local communities in this
18 country.
19 3263 We certainly need the capacity that
20 well-produced local television on the major television
21 stations can generate to address the question. CBC
22 research has given us data about the audience of the
23 combined community channels across the country on a 24-
24 hour basis. You may have seen it. It is very rare
25 that it exceeds 100,000 Canadians. We are talking
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1 about something that hovers below one per cent often of
2 the viewing. So, it is a valuable thing, it is not
3 sufficient.
4 3264 New initiatives -- when you mention
5 Pulse24, that's a Toronto initiative. The station
6 group CHUM seems to have some of the most skill in
7 developing some of these things and others could learn
8 from them. You are going to see some of the examples
9 this autumn on CHRO in the Ottawa area which will
10 probably change the data on this chart favourably.
11 3265 So, all of those things are
12 necessary, but recognizing the importance of
13 flexibility -- every one of the big players has to
14 address that question in their own way. It is not a
15 question of whether they do local, it is what kind of
16 local they do and that is the plane on which we think
17 you should address the question.
18 3266 THE CHAIRPERSON: Thank you, Mr.
19 Morrison. With regard to the use of "insist", why stop
20 at suggest if you can insist?
21 3267 MR. MORRISON: Madam Chair, if I
22 could just add one thing, the government got around two
23 days ago to confirming reports in the Financial Post of
24 your appointment and on behalf of the Friends of
25 Canadian Broadcasting, we wish to congratulate you as
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1 the new Vice-Chair of Broadcasting of this institution.
2 3268 THE CHAIRPERSON: Thank you, Mr.
3 Morrison. I don't know what to make of the fact that
4 you did that at the end rather than at the beginning.
5 Thank you very much, ladies and gentlemen.
6 3269 We will now adjourn for lunch and
7 resume at a quarter to 2:00, just to keep people on
8 their toes. Alors nous reprendrons à deux heures moins
9 quart.
10 --- Luncheon recess at / Suspension pour le
11 déjeuner à 1224
12 --- Upon resuming at / Reprise à 1347
13 3270 THE CHAIRPERSON: Good afternoon.
14 3271 Madam Secretary, would you please
15 introduce the next participant?
16 3272 MS BÉNARD: Thank you, Madam Chair.
17 3273 The next presentation will be by the
18 Council of Canadians.
19 PRESENTATION / PRÉSENTATION
20 3274 THE CHAIRPERSON: Good afternoon,
21 gentlemen. Go ahead when you are ready.
22 3275 MR. BLEYER: Thank you very much.
23 3276 I would like to introduce myself. My
24 name is Peter Bleyer. I am Executive Director of the
25 Council of Canadians. My colleague with me here today
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1 is John Urquhart who is our Communications Director.
2 3277 Right off the top I would like to
3 present apologies from our Chairperson, Maude Barlow,
4 who very much wished to be here, given the importance
5 of the hearings that you are holding. Unfortunately,
6 she was detained elsewhere.
7 3278 We will make a brief presentation.
8 We have seen you work over the morning. We know it's
9 important work that you are doing and we don't want to
10 take too much of your time. We will try and be as
11 focused as possible.
12 3279 THE CHAIRPERSON: Whatever time is
13 required.
14 3280 MR. BLEYER: Thank you, Madam Chair.
15 3281 The Council of Canadians is a
16 national non-profit, non-partisan public interest group
17 with more than 100,000 members from coast to coast.
18 The Council was formed in 1985 and since then we have
19 been active on a variety of key national issues,
20 including promoting Canadian culture.
21 3282 MS BÉNARD: Mr. Bleyer, excuse me.
22 Could you --
23 3283 MR. BLEYER: Slow down, yes.
24 3284 MS BÉNARD: Thank you.
25 3285 MS BÉNARD: My apologies to the
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1 translator as well on that front. Thank you.
2 3286 The Council has a vital interest in
3 this review. Our members have long been concerned
4 about protecting Canada's cultural sovereignty,
5 promoting the interests of Canadian creators and
6 artists and encouraging greater diversity in the media.
7 3287 In fact, in 1996 we helped launch the
8 Campaign for Press and Broadcast Freedom, a network of
9 groups concerned about the increasing concentration of
10 media ownership in this country.
11 3288 In our submission we express our
12 concern about the state of television in Canada today,
13 television broadcasting. We highlight the fact that
14 Canadian programming at all levels is getting weaker
15 with the effect that Canadians are seeing less of their
16 own country and communities on their television
17 screens.
18 3289 Some of the specific issues and
19 recommendations raised in our submission include the
20 following. We recommend strengthening Canadian content
21 regulations for conventional television, particularly
22 during a new definition, we think, of peak viewing
23 time, i.e. eight to ten p.m. Maintaining ownership
24 regulations since we believe that an increase in
25 television ownership concentration would have an
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1 adverse effect on local programming and diversity of
2 content.
3 3290 Concern that an export oriented
4 regulatory framework for Canadian television could
5 threaten to further erode local and regional
6 programming. Concern that budget cuts to the CBC have
7 hurt local programming and created a gap between the
8 public broadcasters' mandate and the resources
9 available to fulfil that mandate.
10 3291 I would like to take a little bit of
11 time to provide you with some details on these issues.
12 3292 The Commission has asked specifically
13 for comments on the adequacy of current Canadian
14 content regulations for conventional television.
15 Despite regulations which are intended to create a
16 greater space for Canadian programming on the air
17 waves, in an effort to maximize their profits, private
18 conventional stations have simply aired the least
19 expensive programming available, which is imported
20 American programming.
21 3293 In the case of English language
22 private television broadcasting, Cancon rules have not
23 been anywhere near as effective as they were intended.
24 This is because they are too evasive. As peak viewing
25 is actually between 8:00 and 10:00 p.m., Canadian
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1 content rules defining prime time as 6:00 to midnight
2 have failed to ensure that private stations offer
3 Canadian programming during real peak viewing hours.
4 3294 I won't give a whole series of
5 examples. That was done, I think, by our colleagues
6 previously, the Friends of Canadian Broadcasting, but
7 one specific example. During the fall 1997 schedule in
8 Toronto, the public broadcaster, the CBC, aired over 96
9 per cent Canadian content per week while CTV and Global
10 broadcast between zero and just over 7 per cent. Given
11 this, it is really little wonder that Canadians know
12 more about life in Miami or Los Angeles than they do
13 about life in their own communities or Canadian
14 communities such as Halifax or Victoria.
15 3295 The Council urges the Commission to
16 take a strong stand on this issue and require private
17 broadcasters to live up to their public
18 responsibilities as they are set out under the
19 Broadcasting Act.
20 3296 Stricter Canadian content rules are
21 required, particularly during peak viewing time. You
22 have heard this already. Private broadcasters
23 undoubtedly will resist any increase in Canadian
24 content regulations. They will cite cost as the
25 principal roadblock.
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1 3297 However, according to your own data,
2 private broadcasters' contribution toward Canadian
3 programming as a share of their operating profits has
4 fallen in recent years. Since 1993, commercial
5 broadcasters have seen their profits soar by 52 per
6 cent, and yet their expenditures on Canadian drama,
7 music and variety programs has increased just 1 per
8 cent, a decrease in real terms.
9 3298 Reducing current requirements for
10 Cancon is clearly not an option. It is virtually
11 impossible to find Canada on the dial during prime time
12 as it is. If private broadcasters are permitted to
13 reduce their existing requirements, a bad situation
14 will simply be made worse.
15 3299 The Commission states that it is
16 interested in exploring "the best ways to ensure the
17 availability of Canadian programs that serve the needs
18 and interests of Canadian viewers that succeed in
19 international markets and that are profitable for
20 broadcasters and producers alike".
21 3300 The Council would suggest that the
22 first two objectives as stated can run contrary to each
23 other. The needs and interests of Canadian viewers
24 will in many cases be unique for Canadians and are not
25 easily exported to foreign markets.
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1 3301 The danger is that by redesigning
2 requirements to focus on success in international
3 markets, the Commission may inadvertently encourage
4 broadcasters to supplant local and regional programming
5 that is more distinctly Canadian with much more generic
6 forms of programming that is geared for export to
7 foreign markets.
8 3302 The Commission has asked whether it
9 may be necessary to ease existing ownership
10 restrictions in order to ensure the ongoing viability
11 of the private broadcasting sector. The Council
12 submits that increased ownership concentration is not
13 in the public interest.
14 3303 The danger of ownership concentration
15 is not only that it leads to increased market power,
16 but that it also results in the loss of diversity as
17 larger media corporations "rationalize" -- I should
18 give that the inverted commas -- their operations.
19 3304 In television, the result is that
20 larger station groups abandon local programming and
21 produce more programs in central Canada that are then
22 broadcast to local audiences.
23 3305 In the area of concentration, the
24 Council is also concerned about the increasing
25 concentration across different distribution systems
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1 and, as well, the trend toward greater vertical
2 integration.
3 3306 To protect the public interest, the
4 Council urges the Commission to develop clear rules
5 governing cross-ownership concentration and vertical
6 integration. This policy is particularly urgent given
7 the increasing tendency on the international stage to
8 further deregulate trade and investment rules.
9 3307 The Commission has also asked for
10 comments on how CBC television can "best complement"
11 the private sector. The Council strongly believes that
12 this is fundamentally the wrong way to frame the issue.
13 3308 We believe the basic role of the CBC
14 should not be to complement private television, but to
15 form an essential element of the bedrock of a Canadian
16 broadcasting system. However, the CBC has been
17 crippled in its ability to fulfil its public service
18 mandate by recent budget cuts.
19 3309 Funding reductions have had a huge
20 impact on the CBC's capacity to produce local Canadian
21 programming. Local newscasts have been scaled back and
22 shows have been cancelled. The CBC has come to rely
23 upon repeat programs to fill the programming schedule.
24 The Council believes that the CBC must continue to play
25 a major role in broadcasting that is not subordinated
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1 to the private system.
2 3310 To sum up, the Council of Canadians
3 is concerned that Canadians are not seeing enough of
4 their own country and of their own communities on the
5 television screen. Local programming has suffered on
6 both the private and on the public networks.
7 3311 Canadian drama and documentary
8 programs are chronically under-represented with private
9 networks showing continuing reluctance to develop and
10 exhibit Canadian programming, as of today at least.
11 Cuts to the CBC's budget have clearly weakened the
12 overall broadcasting system.
13 3312 The Council urges the Commission to
14 adopt a regulatory framework that better fosters the
15 development of Canadian expression and a wide range of
16 programming that more accurately reflects the diversity
17 of Canada. Television broadcasting in Canada is far
18 too important to be driven by a never-ending quest for
19 maximum profit.
20 3313 As a country, as communities and as
21 citizens, we need this critical means of communication
22 to reflect our lives, our realities, if we are to
23 survive and to thrive.
24 3314 Thank you very much.
25 3315 THE CHAIRPERSON: Thank you,
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1 gentlemen.
2 3316 Commissioner Cardozo.
3 3317 COMMISSIONER CARDOZO: Thank you very
4 much, Mr. Bleyer.
5 3318 From what I can tell, this is the
6 first time in a long time since the Council last
7 appeared before the CRTC and hopefully your experience
8 by the time we have finished with you will make you
9 decide whether it will be the last time you will be
10 back again. Hopefully you will be back again. We
11 welcome all sorts of interventions, especially by
12 citizens' groups like yours.
13 3319 One of the specific recommendations
14 you have made in your written brief and which you
15 talked about here was the peak viewing hours between
16 eight and ten. You have suggested a 35 per cent
17 minimum Canadian content as a regulation. A couple of
18 questions on that.
19 3320 Would you prefer that as a regulation
20 which is a firm across-the-board regulation that
21 everyone has to live with or would you suggest we do it
22 as a condition of licence where we would put it on one
23 by one and have more flexibility in doing it, the
24 advantage of which is that we then make an assessment
25 as to whether the particular licensee has the economic
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1 ability to do that because sometimes there are
2 increased costs in running Canadian content during
3 prime time.
4 3321 What are your thoughts about whether
5 it should be an across-the-board regulation or a
6 condition of licence?
7 3322 MR. BLEYER: I think we would limit
8 ourselves to a general comment on that question which
9 would have to do with the fact that if we look at the
10 status quo today, we are facing a very problematic
11 situation in terms of the presence of Cancon in peak
12 viewing time.
13 3323 The question is can we achieve a
14 reversal -- can you achieve, it is your role obviously
15 -- a reversal of that situation with conditions of
16 licence. The situation is so dramatic today that one
17 wonders whether across-the-board is not more
18 appropriate.
19 3324 I'm not clear on the details between
20 the two options, but if we were to look as an overview
21 at the situation, the concern we have is so grave, the
22 situation is so dangerous, perilous we think, in terms
23 of the lack of Canadian content, the problem of
24 continuity of decision making, despite the fact the
25 Chair today, the Vice-Chair, has pointed out that the
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1 Commission is always the Commission, the differences in
2 how the Commission's mandate is interpreted and what
3 rulings the Commission makes over time change, the kind
4 of variability that is more likely to come in with
5 conditions of licence, I can only assume with an
6 across-the-board regulation.
7 3325 Can we afford to risk that at this
8 point in our history? Those would be the concerns we
9 would raise, I would think, between across-the-board
10 regulation and conditions of licence. Of course, you
11 have to deal with the very specific requests and that
12 is something that I can't comment on.
13 3326 COMMISSIONER CARDOZO: It's
14 interesting that you have raised this suggestion
15 because I think you are the first one or maybe the only
16 to be raising it in this hearing, but it has been
17 talked about in the past.
18 3327 One of the problems with it was if we
19 were to put this regulation or condition of licence on,
20 broadcasters might simply run news or might move their
21 news hour into that slot or run sports, where Canadian
22 sports comes a lot easier. Would that be okay if they
23 did that or would you want us to prescribe what type of
24 programming?
25 3328 MR. BLEYER: That would not be okay.
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1 In our brief and we do speak as well in our submission,
2 we speak to the issue of under-represented categories,
3 so we would want -- we would hope that the Commission
4 would consider more than just Canadian content, but the
5 issue of what types of programming are
6 under-represented.
7 3329 Obviously, were it to be another
8 program on how Canada's businessmen are feeling this
9 morning on television, we think there's probably enough
10 of that kind of programming. The types of categories
11 which I assume is news, but it's even more restricted
12 than news, it's business news. We would want there to
13 be stipulations around what kind of Canadian -- what
14 categories within Cancon.
15 3330 COMMISSIONER CARDOZO: One of the
16 other issues you have raised is the issue of
17 concentration or consolidation. Depending on how one
18 approaches this question, one uses the term
19 accordingly.
20 3331 The counter-argument to what you have
21 suggested is a problem, that concentration allows
22 greater efficiencies of scale, sharing of resources,
23 deeper pockets. In this world where we are trying to
24 get good quality programming that is going to compete
25 against the high budget American content, having this
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1 type of deeper pockets approach allows us to have
2 higher quality, higher expenditure programming.
3 3332 What do you think of that argument?
4 You talk about danger of increased market power. What
5 is the danger of increased market power? Is there a
6 benefit to increased market power as well?
7 3333 MR. BLEYER: The short answer would
8 be yes, there is a benefit to increased market power.
9 Some of that benefit accrues only to the holder of that
10 market power and some of it accrues to society at large
11 and more of the risk I think is for society for the
12 public interest and more of the benefit is for the
13 holder of that power.
14 3334 Let me just draw a bit of an analogy.
15 The Council is concerned about concentration of
16 ownership not only in the area of communications. We
17 are concerned about concentration of corporate
18 ownership in general, banking for example and in other
19 areas.
20 3335 It's not so much that these areas are
21 analogous, but there is the question of in a society is
22 it safe, is it constructive, is it productive for a few
23 hands to hold so much power? In the area of
24 broadcasting, this is even more problematic potentially
25 given the role that broadcasting plays in
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1 communications. It is about communications. It is
2 about people seeing images, understanding their
3 country, perspectives on their country and so forth, we
4 hope on their country mostly and not on other
5 countries.
6 3336 For us, there is the broader public
7 interest of concentration in this sector as a partially
8 corporate sector, corporate-driven sector. There is
9 that specific problem.
10 3337 Certainly, as in the case with banks,
11 there is a certain level of concentration,
12 consolidation, that provides economies of scale and so
13 forth. The question is when do you go too far and when
14 do you move to a point where that has more of a
15 negative impact on the public interest and where the
16 benefit largely accrues to the holders of that market
17 share.
18 3338 We see the kind of so-called
19 consolidation, as they would call it, and perhaps
20 concentration as we would call it, in many instances
21 today the benefits are accruing simply to the
22 corporations who are doing that consolidation. They
23 are not accruing to the Canadian public in terms of
24 seeing themselves, the communities, having more access
25 to local programming and local news.
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1 3339 We can only base our perspective on
2 the reality, on the status quo, and the reality is that
3 in many instances concentration has been a bad thing.
4 We have looked also at the printed media and worked on
5 that issue and we can see what is happening already in
6 this country in that area.
7 3340 That's not to say that there aren't
8 debatable, important debatable points within that
9 frame.
10 3341 COMMISSIONER CARDOZO: Let me put to
11 you the position that the witness before you was
12 talking about. The position of Friends was that they
13 are not against concentration, but make the
14 concentrators pay, I think is what Mr. Morrison's term
15 was.
16 3342 Does it give you any satisfaction
17 that the Commission has the ability to say "Okay, you
18 can consolidate but these are the things you have got
19 to do in exchange of Canadian programming or whatever
20 else". Does that offer you consolation?
21 3343 MR. BLEYER: Consolation is the right
22 word. It is not ideal. What we would like to
23 challenge, among other things, is the notion of the
24 inevitability of this concentration, that it is
25 inevitable that we move in this direction. We are not
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1 clear that it is.
2 3344 Again, if we are moving in that
3 direction and if the Commission can place stringent --
4 I think the previous witnesses point around making the
5 concentrators pay is quite substantial consolation to
6 us probably if that were to happen. The question is
7 would that actually take place.
8 3345 COMMISSIONER CARDOZO: I would like
9 to discuss this a whole lot more but we have another
10 major one of these coming down the pipe in the next few
11 months. Perhaps we shouldn't get too far into that
12 because there will be a proceeding. Maybe you can come
13 to that hearing and we can carry on this discussion in
14 detail.
15 3346 Let me talk about the other issue you
16 raised with regard to export and the other issue in
17 terms of you challenging another of, I suppose, the
18 conventional thoughts which is the export focus on
19 production, I think is the way you put it.
20 3347 You were suggesting today and in your
21 written brief that if we export too much, we run the
22 danger of having stuff that doesn't have a lot of
23 Canadianness to it, I think is how I could paraphrase
24 that.
25 3348 The other argument is this.
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1 Producing television content is very expensive. We
2 don't have a very big market in Canada that pays for
3 it. When you divide it into English and French, you
4 have even smaller markets and you have got shrinking
5 government subsidies or public subsidies.
6 1410
7 3349 So one of the ways to -- and you have
8 got shrinking government subsidies, public subsidies.
9 One of the ways to fund that programming is through
10 export revenues, so you produce programming that will
11 be shown here and will be exported and you have got
12 additional revenues there. Again, that is the way you
13 can get enough money together to make the kind of
14 quality programming that Canadians will be interested
15 in watching. So, it is again one of these conundrums.
16 What are your thoughts on that?
17 3350 MR. BLEYER: First of all,
18 unfortunately, it is not the purview of this Commission
19 to make decisions on public subsidies, but we hope we
20 can turn the corner on the reductions in public
21 subsidies to broadcasting that --
22 3351 COMMISSIONER CARDOZO: You are
23 counting on that, are you?
24 3352 MR. BLEYER: Well, we are working for
25 that. That's our role, to stay optimistic and to work
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1 and to work with Canadians to move in that direction.
2 We are not counting on it certainly.
3 3353 As for the importance of exporting
4 quality programming, that's an interesting point and
5 one of the ways that we could ensure that more top
6 quality Canadian programming was developed would be to
7 impose stricter regulations around peak viewing time.
8 3354 We would oblige, therefore, Canadian
9 stations to be producing or to be working towards the
10 kind of programming that not only would attract
11 Canadians during peak viewing time, but which they
12 could also export.
13 3355 We are not opposed to the export of
14 Canadian products. We are just raising a warning flag
15 to the Commission that if we move too far in the
16 direction of putting an export-driven model in place --
17 I could point to a lot of export-driven models around
18 the world that in the last few months, not necessarily
19 with regard to broadcasting that are falling apart.
20 3356 One of the ways in which they fall
21 apart, quite aside from the economic instability that
22 export-driven models have, is the fact that they can
23 undermine our ability to reflect our communities to
24 ourselves, if all we are doing is producing generic
25 fare that could be filmed anywhere really, but it just
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1 happens to be done here. We are not actually doing the
2 job that we think broadcasters should be doing of
3 reflecting local communities to themselves and
4 providing quality broadcasting.
5 3357 So one of the solutions would be to
6 impose the kind of regulations or conditions of licence
7 that would imply more Canadian programming during peak
8 viewing time. That would provide the kind of programs
9 that would then be easily exportable. But we are just
10 saying let's watch out, let's not set export driven as
11 a huge priority here. Maybe that could be a
12 consequence of good quality programming produced for
13 Canadians.
14 3358 Some of that programming produced for
15 Canadians will not be, you know -- we could use an
16 example like "This Hour Has 22 Minutes." Now, of
17 course it is on CBC, Salter Films. Without getting
18 into the details, there is a bunch of stuff that is
19 produced that is high quality, that's good, that's very
20 Canadian and nobody anywhere else would understand it
21 or want to watch it.
22 3359 COMMISSIONER CARDOZO: Okay. So you
23 are not opposed to it, but you are raising a warning?
24 3360 MR. BLEYER: Yes. We think the
25 notion of the export driven model is a problem. If
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1 that is the top priority that is a big problem, but
2 exporting quality Canadian programming is one of the
3 things that Canadian produces need to do in order to
4 make revenue.
5 3361 COMMISSIONER CARDOZO: The producer
6 or the head of Salter Street was here with another
7 presentation I guess yesterday. She was making the
8 point that they have done -- three of their top
9 productions are "22 Minutes," "Emily of New Moon" and
10 "Lexx." "22 Minutes," as you know, doesn't have
11 exportability. "Emily of New Moon," which is based in
12 P.E.I. actually does have a lot of exportability, but
13 at the same time is quite clearly Canadian. "Lexx" is
14 not and perhaps more generic, to use your word, but is
15 also good exportability. Is that sort of okay?
16 3362 MR. BLEYER: Far be it -- a company
17 that produces "This Hour Has 22 Minutes" is okay by me,
18 on a personal level. They can do anything else they
19 want after that. That's my personal opinion of course.
20 3363 The notion that you can produce
21 quality programming that is relevant to Canadians -- if
22 we are going to reflect Canada to Canadians and we are
23 also going to reflect Canada to the rest of the world,
24 more power to us.
25 3364 But it is when we use the downtown
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1 streets of Toronto or Vancouver to reflect New York
2 back to New York or L.A. back to L.A. because it is
3 cheaper to do it here and that's just about the only
4 reason and also it fulfils requirements around Cancon
5 or what not. That's a different kind of export-driven
6 model.
7 3365 So, as you describe the Salter Street
8 Film model, that's a very interesting -- hopefully we
9 can have more small -- relatively small or medium-size
10 enterprises that are doing that kind of work.
11 3366 COMMISSIONER CARDOZO: So, Maude
12 Barlow has been skewered by "22 Minutes" or not? Would
13 you like us to suggest anything?
14 3367 MR. BLEYER: I guess not yet because
15 I said it was my own personal opinion. I am sure she
16 would love to be skewered by Rick Mercer.
17 3368 COMMISSIONER CARDOZO: One of the
18 recommendations you have made on page 15, you said that
19 broadcasters should do more to reflect aboriginal
20 people's cultural diversity in local programming. Do
21 you have any more thoughts, any specifics in that area?
22 I believe it was page 15.
23 3369 MR. BLEYER: Yes, I think you are
24 right. You have page numbers and I don't.
25 3370 COMMISSIONER CARDOZO: It's the
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1 section entitled "Diversity," No. 8.
2 3371 MR. BLEYER: Yes.
3 3372 I think we made some pretty general
4 recommendations there. We didn't make specifics.
5 Obviously, if you look at what is going on right now in
6 terms of cuts to the CBC and to a reorientation,
7 perhaps because of refocusing on commercial revenues at
8 the CBC, for example on the Newsworld Business News and
9 so forth, the ability even of the public broadcaster to
10 reflect these other voices is compromised by a
11 dependence on revenues. We know that the way you get
12 revenues is by selling advertising if you are dependent
13 on advertising. The way you get advertisers is through
14 the sort of niches of people who theoretically can buy
15 products and, generally speaking, the voices that
16 aren't heard, the faces that aren't seen are of people
17 who aren't in those categories.
18 3373 So, there is a whole bunch of things
19 that are taking us in the wrong direction right now
20 that we could stop -- for example, what is going on in
21 terms of public subsidies, which again I realize is
22 within a different context that would stop us from
23 heading in the direction of undermining our ability to
24 see those voices at this point, but I don't think we
25 made any specific recommendations on those matters.
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1 3374 COMMISSIONER CARDOZO: My last
2 question has to do with I think the last other big
3 issue you raised, which was the CBC and the issue of
4 complementary. You have noted in your comments today
5 that you felt that the CBC is an essential element of
6 the bedrock of Canadian television.
7 3375 In terms of complementary and the use
8 of that word there are two approaches to it. One is to
9 say that in the early days the CBC was the largest --
10 was the only national broadcasters and, therefore, the
11 private sector was developing and it complemented the
12 CBC. Today there are a couple of budding or new full -
13 - they are networks however you look at it, station
14 groups and the private sector overall is probably
15 larger than the CBC -- I am pretty sure it is. So, in a
16 sense there is that issue of which one is complementary
17 to which.
18 3376 The other aspects of complementarity
19 is that complementary is the opposite of competing and
20 that too often the CBC, it is felt, has been competing
21 with the private sector in bidding for some of the big
22 ticket items, like the Olympics or sports. What are
23 your thoughts about what this means, that you don't
24 feel that the CBC is complementary to the private
25 sector?
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1 3377 MR. BLEYER: Again, as with so-called
2 consolidation or concentration, what we believe is that
3 the relative size today of public and private
4 broadcasters was not something that was brought down
5 from the heavens. It is a process that has taken place
6 between different forces in our society. The inability
7 or unwillingness of successive governments to maintain
8 a strong public broadcaster. There is no particular
9 reason why we should have that current balance.
10 3378 The balance is different if you look
11 at the roles they play in our society in terms of
12 reflecting Canada back to Canadians and so forth. Then
13 you have to move the stick right back to the public
14 broadcaster.
15 3379 In terms of the presence overall,
16 clearly it has shifted. So, we wouldn't want to accept
17 that as a given.
18 3380 Certainly it is a given today, but it
19 is not written in stone that the public sector should
20 be forever shrinking and that the private sector should
21 grow dramatically through consolidation or however, the
22 agreement to new networks and so forth.
23 3381 In terms of the notion that the CBC
24 competes with the private networks and, consequently
25 deprives the private networks unfairly of revenues, for
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1 example, in the area of sports and so forth, we would
2 hate to see the CBC limited to a place where it did not
3 connect with some of the things that Canadians do want
4 to see. There is no doubt we think there is too much
5 sports and not enough of several other underrepresented
6 categories, but hockey, for example, is not only a key
7 element of the Canadian reality for a lot of Canadians
8 and for me until the Montreal Canadians are eliminated
9 from the Stanley Cup playoffs every year, but it
10 also --
11 3382 COMMISSIONER CARDOZO: That may
12 change too.
13 3383 MR. BLEYER: But it is also a revenue
14 source.
15 3384 We can't have it both ways. We do
16 think that there should be more public support, but at
17 the same time we are hacking back at the CBC and then
18 we have the private networks saying you can't have
19 access to this because it is unfair competition for us.
20 Well, if it is a source of revenue for the CBC -- so I
21 don't think we would like to see the CBC ghettoized,
22 that it should be full service.
23 3385 I don't know, full service, I am
24 thinking of banks again -- full service banking.
25 Hopefully the CBC won't be run like a bank or any of
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1 the other broadcasters, but that a full-service network
2 and my apologies if it is not the correct terminology,
3 to really provide -- if we are going to reflect Canada
4 back to Canadians, then it includes some of these
5 things. It is the balance between them that may be
6 off, but the balance is mostly off across the whole
7 spectrum of English language television broadcasting.
8 3386 Within the CBC it is a much more
9 interesting balance between -- the underrepresented
10 categories are not quite so underrepresented.
11 3387 COMMISSIONER CARDOZO: So what is
12 your vision of what the CBC can do which the others
13 cannot or don't do?
14 3388 MR. BLEYER: Well, the areas that the
15 others -- we think that you -- we believe it is within
16 your power and that you have shown an understanding and
17 a willingness to do the kind of regulating that would
18 see other broadcasters be more responsible in terms of
19 what Canadians want to see.
20 3389 But for the CBC, you know, the issue
21 of local programming, the presence of local stations in
22 communities is one. We have communities where the CBC
23 shuts down and often you either have no local news or
24 you have the incredibly low budget local news that you
25 don't know how they manage to pull it together. So
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1 there is that whole issue of local communities seeing
2 themselves.
3 3390 All the problems that you see with
4 lax in terms of Cancon and community representation,
5 the question of diversity, all of those issues should
6 be dealt with without excluding the CBC from areas like
7 -- I used hockey as an example, so I will stick to
8 hockey. My diversity includes hockey I guess.
9 3391 COMMISSIONER CARDOZO: My Canada
10 includes the Montreal Canadians.
11 3392 MR. BLEYER: There you go. The Expos
12 is where the problem arises.
13 3393 COMMISSIONER CARDOZO: That covers my
14 questions. Thank you.
15 3394 Thank you, Madam Chair.
16 3395 THE CHAIRPERSON: Thank you,
17 gentlemen. Have a nice weekend and give our regards to
18 Ms Barlow.
19 3396 MR. BLEYER: We will, absolutely, and
20 our regards to the Chair for a full recovery and we
21 will come back most certainly, if invited of course.
22 3397 THE CHAIRPERSON: Madam Secretary,
23 would you invite the next participant please.
24 3398 MS BÉNARD: Thank you, Madam Chair.
25 3399 The next presentation will be by WIC,
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1 Western International Communications Limited and I
2 would invite them to come forward.
3 3400 THE CHAIRPERSON: Good afternoon,
4 gentlemen. Proceed when you are ready.
5 PRESENTATION / PRÉSENTATION
6 3401 MR. MACDONALD: Thank you very much,
7 Madam Chair.
8 3402 Members of the Commission and staff,
9 my name is Jim Macdonald. I am President and CEO of
10 WIC Television Ltd. With me today in the front row on
11 my right is Grant Buchanan, Vice-President, Corporate
12 and Regulatory Affairs for WIC and on my left is Nic
13 Wry, Senior Vice-President, WIC Entertainment. In the
14 back row are Ric Davies, Vice-President, Programming
15 WIC Premium Television; Will Graber, Special Projects
16 Manager, WIC Television Ltd., and Ken Goldstein,
17 President of Communications Management Inc. Also
18 present in the audience today is our President and CEO,
19 Tom Peddie.
20 3403 While the general focus of this
21 hearing will be on conventional television, we would
22 like to begin by re-emphasizing a point made in the CAB
23 submission, that being the importance of this hearing
24 looking at the entire broadcasting system as well as
25 those factors which will impact directly on
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1 conventional television and which go beyond the issue
2 of audience fragmentation.
3 3404 We discussed a number of these
4 serious environmental factors in our written materials
5 and which included: Changes in the way television is
6 sent and received; in the way we pay for television; in
7 the economic linkages inside and outside the Canadian
8 television system; in our ability to promote Canadian
9 programs; in our ability to regulate effectively; in
10 the changes in ownership that have occurred from
11 family-controlled companies to publicly owned; and
12 changes in the international trade environment.
13 3405 We also share the belief espoused by
14 the CAB that, with the tremendous increase in both the
15 investment and exhibition of Canadian programming made
16 by the specialties, the key focus of this hearing must
17 now be on how to improve the viewership to Canadian
18 programming.
19 3406 While we have said it before, it
20 cannot be stressed enough that the old paradigm of
21 cross-subsidization of Canadian programming from high
22 margins on U.S. shows is at the back end of the life
23 cycle because increased competition for national rights
24 is driving program costs up while audience
25 fragmentation is driving margins down.
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1 3407 We have now completed three years of
2 the present seven-year licences that resulted from the
3 most recent round of television renewals. The
4 flexibility accorded broadcasters as between exhibition
5 and expenditures has spawned a variety of approaches to
6 Canadian content, both within corporate groups and as
7 between them. The resulting diversity in strategies
8 and in Canadian content programming is not accidental.
9 The regulatory design currently in place rewards
10 different genres of programming and has not created a
11 disincentive for certain genres of programming on a
12 system-wide basis.
13 3408 Thus, we view with concern the notion
14 of devaluing certain types of programming in favour of
15 others -- most particularly the idea of focusing
16 exclusively on Categories 7, 8 and 9. We would like to
17 repeat once again that other categories like news
18 should not be taken for granted. Contrary to the
19 popular view that news is profitable and thus a "sure
20 thing," this is very often not the case. The
21 Commission has heard a great deal about the importance
22 of local service in its town hall meetings. It also
23 has become a theme at this hearing and WIC is sensitive
24 to the concerns raised by others in this regard,
25 including the preceding intervenors.
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1 3409 In summary, as we move forward, it
2 will be even more important for conventional
3 broadcasters to be able to differentiate themselves
4 from each other. Not only is this important for the
5 broadcasters themselves; it is also important for the
6 system.
7 3410 For WIC, news is a core competency in
8 many of our stations. The development of strong prime
9 time Canadian drama is also, by necessity, a key focus.
10 As the Commission is aware, however, WIC Television is
11 comprised of CTV affiliates, CBC affiliates and
12 independent stations. In Alberta, while three of our
13 stations are independent, we have a commitment to
14 purchase all programming which is aired on the Global
15 Television Network in Ontario and thus those stations
16 could be considered as Global affiliates and maybe more
17 as we move forward.
18 3411 As a result of the inability to fully
19 control the schedules of the television stations we
20 own, we have developed an approach to production which
21 is unique amongst Canadian broadcasters in that the
22 Canadian programs that we develop and license through
23 WIC Entertainment do not always run on WIC stations.
24 "Emily of New Moon," as an example, runs on the CBC,
25 while "Kleo," "Billy The Cat," "Nilus the Sandman" run
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1 on Family Channel. "Donkey Kong Country," airs on
2 Teletoon and "Strangers," now runs on Showcase.
3 3412 Our licensing focus, on the other
4 hand, has only one objective; finding projects with
5 high production values which we believe can attract a
6 competitive audience level. As a result, many programs
7 that we have licensed, such as "Stargate," or "Night
8 Man" and "Amazon" with Atlantis or "Total Recall" with
9 Alliance, are projects that have international
10 production partners thus assuring competitive
11 production budgets. These programs do not require
12 Telefilm and CTCPF funding and do not qualify for a 150
13 per cent credit.
14 1430
15 3413 We believe that the greatest
16 diversity is created in the system by establishing the
17 simplest possible rules to ensure equitable
18 contribution from each of the players and then allowing
19 the individual entities in the system to find their own
20 niches. That said, the Commission will need to
21 exercise great care in its efforts to create a level
22 playing field with equitable contributions from each of
23 the "large, multi-station ownership groups and
24 networks".
25 3414 For example, while the total costs of
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1 acquiring or producing an equal number of hours of same
2 genre programming would be very similar for each group,
3 the revenue base over which those costs would be
4 amortized is very different. In other words, the
5 smaller groups would bear a cost in percentage terms
6 relative to revenue that would be significantly higher
7 than for the larger groups.
8 3415 In summary, while WIC intends to
9 schedule primarily Canadian drama in prime time, we do
10 not feel that broadcasters should be required to have
11 their scheduling options so constrained. Competitive
12 forces will ensure diversity. Indeed, we believe that
13 this approach is consistent with the section of the
14 Broadcasting Act relating directly to the obligations
15 of programming undertakings, as well as to the findings
16 of the Crop Study which you placed on the file
17 Wednesday.
18 3416 In reviewing the public file, we have
19 noted that a number of groups suggest that you find a
20 way to make television groups do "more". We are here
21 today, however, to try to provide a "reality check" as
22 opposed to a blank cheque for the forces of "make them
23 do more".
24 3417 The fact is that the industry is now
25 comprised almost exclusively of licensees controlled by
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1 public companies. While the industry has been
2 profitable in the past and has had a few good years
3 recently, industry pre-tax profits are still below 10
4 per cent. Investors look really only at two factors,
5 risk and return, and for this reason maintaining the
6 opportunity for the conventional broadcasting industry
7 to grow back to previous levels of profitability is the
8 only way to ensure that equity investment in the
9 industry will continue. This is especially true at a
10 time when the industry needs to find half a billion
11 dollars to convert to digital over-the-air
12 transmission.
13 3418 So, when we work through the CFTPA's
14 10/10/10 proposal, for example, the impact on WIC is to
15 reduce the profit of WIC television by a minimum -- and
16 I stress minimum -- of $20 million per annum. The
17 Commission will recall that WIC's entire profit -- now,
18 this is the corporate profit -- last year was $10
19 million. So, the "do more" proposals you have heard
20 are simply not consistent with the economic viability
21 of the engine that pulls the system.
22 3419 So, let us end where we began. The
23 increases in both hours and dollars of Canadian
24 programming in the broadcasting system have been
25 significant. We are not advocating that you move away
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1 from any of the present regulatory tools available to
2 you, nor are we suggesting a change to existing
3 conditions of licence. We simply need your leadership
4 to change the focus, to change the currency, to change
5 the viewership, which, in our view, is the only number
6 that really matters.
7 3420 Just before we finish, we would like
8 to take a minute to address a couple of issues related
9 to our pay and pay-per-view television services. While
10 the emphasis so far in this proceeding has seemed to
11 focus almost entirely on conventional over-the-air
12 broadcasting, the Public Notice clearly included pay
13 and pay-per-view within the definition of broadcasters.
14 This raises a few concerns when we hear proposals being
15 worded that "all broadcasters" should be required to do
16 certain things, many of which are simply not applicable
17 to pay television.
18 3421 In addition, there are suggestions
19 contained in various submissions for "first run"
20 requirements for conventional broadcasters. We have
21 discussed this issue with producers and believe that
22 they agree with us the concept of "first run" should
23 not preclude a prior run on pay or pay-per-view, where
24 appropriate, and where the timing and conditions allow.
25 We must confess to disappointment in hearing the CBC's
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1 comment on this issue yesterday. These airings are
2 very important to pay television, offer incremental
3 licence fees to producers and have little effect on the
4 conventional television side.
5 3422 We thank the Commission for the
6 opportunity to present our views and look forward to
7 your questions.
8 3423 THE CHAIRPERSON: Commissioner
9 Wilson?
10 3424 COMMISSIONER WILSON: Good afternoon,
11 gentlemen.
12 3425 MR. MacDONALD: As I was watching you
13 sit in the audience, I noticed that you did have one
14 woman with you and I thought, "Okay, one woman and all
15 these guys. How am I going to address them, 'lady and
16 gentlemen'?" But this makes it easy.
17 3426 MR. MacDONALD: Duly noted,
18 Commissioner Wilson.
19 3427 THE CHAIRPERSON: We are making up
20 for it.
21 3428 COMMISSIONER WILSON: That's right.
22 3429 What I would like to do with you
23 today as the first broadcaster to appear since the CAB
24 appeared is take you through really the most
25 significant component of that proposal, which is the
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1 viewership targets, and ask you some specific questions
2 about how that's going to work.
3 3430 I guess the second thing that I want
4 to do is talk to you about some of the comments that
5 were raised in the CFTPA submission and then I would
6 like to go through some of the statements that you made
7 in your submission and just ask you some clarification
8 questions and just get your views on some of the ways
9 that, when I read it -- obviously, you wrote it, you
10 have a view of what it means. I read it, I might see
11 it a little bit differently and I would just like to
12 try and reconcile those.
13 3431 With respect to the CAB system goals,
14 in their submission the CAB has proposed that the
15 Commission establish a target of viewing for Canadian
16 programs across the entire conventional broadcasting
17 system, including the CBC. I think we all agree that
18 this is a very important measure of how successfully we
19 are meeting the objectives of the Broadcasting Act, but
20 in order for the Commission to really be able to
21 evaluate whether or not this is the way for us to go in
22 the future, I think that we need more specifics about
23 how it's going to work.
24 3432 I guess my fear is that we say,
25 "Okay, let's choose viewership as the target", and then
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1 we might spend two years trying to figure out how we
2 are going to measure it, how it's going to work. So,
3 I'm hoping that during the course of the time that you
4 were preparing the submission you were thinking about
5 what some of the general parameters of that system
6 might be. There are so many different ways, so many
7 different factors that you have to take into account
8 with respect to the ratings of a program and where it's
9 scheduled and how it's made. Maybe I could just ask
10 you sort of a series of questions and you can do your
11 best to give me some answers.
12 3433 MR. MacDONALD: Sure.
13 3434 COMMISSIONER WILSON: So, let me just
14 -- I will ask you the questions before you give me the
15 answer.
16 3435 MR. MacDONALD: I had the answers for
17 your questions.
18 3436 COMMISSIONER WILSON: You already
19 have the answers. Okay, that's good.
20 3437 How would your company make specific
21 commitments to contributing to the achievement of these
22 goals? Would you propose specific targets for each of
23 your licensees or would you present a target for the
24 entire corporate group?
25 3438 MR. MacDONALD: Well, I would like to
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1 just back up one step, if I could, for a second and
2 that is to re-emphasize your earlier point regarding
3 the fact that this is the first time we are really
4 looking at a qualitative goal and what becomes
5 difficult is we have typically looked at quantitative
6 goals because, by their very nature, you can count
7 them. So, here we are looking at a qualitative goal,
8 but at no point are we suggesting moving away from the
9 existing tools of measuring our performance in the
10 system. We are not talking about getting rid of A, B.
11 We have actually recommended a third option, a C.
12 3439 So, we are not suggesting that
13 stations should move away from any of the existing
14 quantitative goals that they are currently measured on
15 by the regulator. What we are simply saying is that as
16 we move forward, if we don't change the focus to what
17 really counts, which is viewers, then we believe we are
18 going to have some serious trouble.
19 3440 So, the question is a very good one:
20 How would it practically work? This is one of the
21 areas where the fact that we are consolidating as an
22 industry into relatively small groups in fact can make
23 it work because we are not dealing with all kinds of
24 ownership issues, we are dealing with a relatively
25 small group of people.
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1 3441 What I am going to share with you is
2 how WIC thought it could go about this. Now, I am not
3 sure that our thoughts will be echoed by all of our
4 colleagues, but we look at it like attacking any other
5 business problem. The problem --
6 3442 COMMISSIONER WILSON: We are just
7 trying to get a clearer idea of how that's going to
8 work. So, your model, even if it may be slightly
9 different than another multi-station group, is still
10 helpful for us in terms of figuring out how it's going
11 to work.
12 3443 MR. MacDONALD: Well, we start in any
13 situation with doing a SWOT analysis, what are the
14 strengths, weaknesses, opportunities and threats, and
15 we build business plans on a collective basis. So, we
16 would start by working with each of the stations
17 because we have to really build it from a bottom-up
18 basis. We have to determine what the overall goal
19 means in each of the markets collectively, we need to
20 know exactly what the responsibilities of WIC are to
21 the overall national goals and then we have to figure
22 out how we are going to get there.
23 3444 COMMISSIONER WILSON: When you say
24 you would have to establish what WIC's contribution
25 would be, do you envisage a possibility that each
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1 multi-station group would make a commitment to the
2 national goal?
3 3445 MR. MacDONALD: Yes, because we have
4 to start from somewhere. WIC currently has a share of
5 tuning in each of its markets and the only way in which
6 we are going to collectively move the bar is if we all
7 move the bar. So, we think that the way to do that is
8 to create a business plan on a market-by-market basis
9 that is then brought together into a WIC business plan
10 that would be developed over the first three years. It
11 would be a three-year business plan to how we are going
12 to move the bar forward.
13 3446 Now, you will recall at the CAB
14 presentation we suggested that even though these be
15 five-year goals, we really needed a three-year
16 implementation window with reports that would be
17 submitted on an annual basis. So, we felt that the
18 first submission to the Commission would be a business
19 plan that would have to look at not only the viewing,
20 because that's just identifying the problem, the bigger
21 issue is how are we going to close the gap.
22 3447 The business plan, therefore, would
23 have to get into the promotional components, the money,
24 the advertising, the cross-promotion that we would want
25 to do, the marketing. One of the things that we have
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1 never done a very good job of, quite frankly, is moving
2 advertisers into the support of Canadian programming.
3 How could we do that? What is the role of our Internet
4 sites in promoting that? So, I think that, as I said
5 earlier, what gets measured, gets done.
6 3448 When you put the focus on it like
7 that and you have each of the major companies as a
8 basic objective of their company from top down looking
9 at this one issue, there is a tremendous amount of work
10 that can go into it. But I see it as a business plan
11 emanating from the station level to the national level
12 and then we bring it together at that point.
13 3449 COMMISSIONER WILSON: Actually, when
14 I read that phrase in your submission, "what gets
15 measured gets done", I thought of the 60/50 and how
16 true that is. If you say 60, you do 60. If we say 50,
17 you do 50. So, I guess there are two ways of looking
18 at that phrase.
19 3450 MR. MacDONALD: Well, that's true.
20 3451 COMMISSIONER WILSON: You are saying
21 if we measure the viewership or you set the targets,
22 then that will get done.
23 3452 MR. MacDONALD: I think in our in-
24 chief earlier I said that what we are looking for is
25 leadership because it is the leadership that drives
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1 everything. The Commission's responsibility is to the
2 Canadian broadcasting system, but we are still looking
3 at this whole process as involving a number of
4 different players. There is the Commission, there is
5 Heritage, there is Industry Canada, there is Finance.
6 3453 There is a whole bunch of different
7 components that have to come together if we are going
8 to be really successful. Revenue Canada is obviously
9 involved from a tax point of view. Finance is very,
10 very involved because one of the things that we keep --
11 the concern that keeps being brought up over and over
12 is the Fund and how critical the Fund is to producing
13 the indigenous Canadian programming.
14 3454 So, when you are dealing with
15 something that we are told is so critically important,
16 that every $1.00 of that Fund creates $5.00 of
17 production, thousands of jobs -- I mean think about the
18 GST and the income tax coming back on that investment,
19 far less the cultural side of it. There is just a
20 number of players that all have to work together to
21 make this work.
22 3455 COMMISSIONER WILSON: So, when you
23 said on page 4 of your opening remarks "by establishing
24 the simplest possible rules", you were probably kind of
25 understating it. It's not really simple at all is what
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1 you are saying. Michael MacMillan made that comment
2 yesterday. He said it's a very complex web of
3 interrelationships and I think that that is very true.
4 3456 MR. MacDONALD: Absolutely, but I
5 think that at the CAB presentation we tried to make it
6 clear that the viewing goals we saw as being very
7 difficult to license, to set as a condition of license,
8 to set as an enforceable entity, and that's why we
9 stated over -- and this is very, very important. We
10 are not asking or suggesting that the Commission in any
11 way, shape or form should move away from the
12 quantitative benchmarks that currently are used to
13 measure performance. We are simply saying --
14 3457 COMMISSIONER WILSON: Don't change
15 those.
16 3458 MR. MacDONALD: We are not suggesting
17 that they be changed, but let's change the focus and
18 let's try to move the focus over to the one thing that
19 in the longer term is going to be very, very important.
20 3459 It was characterized by one of the
21 intervenors today as the CAB position was: Trust us.
22 No, that's not the CAB position at all because we are
23 not asking you to move away from any of the existing
24 rules and guidelines. We are simply saying: Work with
25 us to move the focus through your leadership away from
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1 strictly hours, strictly dollars, to the one thing that
2 we haven't been measuring that we really need to, which
3 is viewers.
4 3460 COMMISSIONER WILSON: When you say
5 the one thing that we haven't been measuring -- and
6 maybe this will sound like a naive comment to you. Of
7 course, I ran a break-even operation at CPAC, so you
8 will forgive me if I don't have the appropriate profit-
9 driven approach to this, but I guess I just find it
10 hard to understand why all of a sudden we have twigged
11 to the notion that viewers are important. Aren't
12 viewers the only reason you are doing -- well, no, I
13 guess maybe your shareholders are, but aren't they the
14 reason that you are doing television?
15 3461 When I first read that -- I don't
16 disagree with it at all, but when I first read it I
17 thought: Well, yes, we are going to focus on viewers
18 because viewers means reach or share means ad sales
19 means profit. So, that's the business case. That's
20 the business incentive for it.
21 3462 MR. MacDONALD: And you have
22 concluded that these guys are all of a sudden rocket
23 scientists. Right?
24 3463 COMMISSIONER WILSON: Yes. I
25 thought: Gee, I have been in the wrong business all
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1 these years. I should have been working in
2 conventional broadcasting, I guess.
3 3464 MR. MacDONALD: Then let me back-step
4 a little bit because it's not that all of a sudden the
5 light went on. The business paradigm has changed
6 rather dramatically and what I was referring to in the
7 text of our presentation where I said that the classic
8 cross-subsidization paradigm is in the back end of its
9 life cycle is that traditionally we had U.S.
10 programming that was making enormous margins and it
11 cross-subsidized Canadian programming that we lost
12 money on.
13 3465 It was acceptable, I suppose, at the
14 end of the day because the margin was there at the
15 bottom of the page that made shareholders happy and
16 everybody got along just fine, thank you very much, but
17 that paradigm is gone because the competition has
18 raised prices. As I said, it has introduced a new
19 level of audience fragmentation. Those two factors
20 have really flattened the margins on U.S. programming
21 and, as a result of that, I think that broadcasters
22 have looked very clearly and said, "We can't have 60
23 per cent of our schedule where we just simply say it's
24 a tax, it's a cost of doing business."
25 3466 So, certainly as we moved forward, we
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1 said, "What is the long-term goal that we have to have?
2 What is the one thing that we are really not achieving
3 with some of our Canadian programming?" The one thing
4 on a consistent basis was viewers and that was why it
5 became so important to us.
6 3467 COMMISSIONER WILSON: I just want to
7 grab a slide here.
8 3468 When you were talking just now, you
9 talked about how the margins are flattening out on the
10 U.S. programming and I think I recall that Coopers &
11 Lybrand presented a slide that showed for every dollar
12 of air time revenue you bring in how much you spend or
13 how much you earn. Yes, how much you earn on
14 programming. I think it showed it was $120 for every
15 dollar.
16 3469 MR. MacDONALD: Yes, I believe that
17 was the Coopers & Lybrand number.
18 3470 COMMISSIONER WILSON: So, maybe you
19 have to give me a bit of a lesson here.
20 3471 Yes, that's it, $120. Thanks, David.
21 3472 You lose $75 on Canadian domestic,
22 you earn $20 -- it's actually operating margin per
23 hour.
24 3473 MR. MacDONALD: That's correct. The
25 one thing, Commissioner Wilson, that is not reflected,
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1 of course, in that number has only been in the last
2 relatively short while, that margins on U.S. started to
3 take a tumble.
4 3474 COMMISSIONER WILSON: How short a
5 while would it be?
6 3475 MR. MacDONALD: Well, I would think
7 really over the last two to three years. So, moving
8 forward is where we think that we will see the greater
9 impact.
10 3476 COMMISSIONER WILSON: Thank you for
11 that.
12 3477 Let me just go back to the system
13 target, the viewership targets, and just ask you -- I
14 think, actually, that Commissioner Wylie asked this
15 question of the CAB when they were up here, but I'm not
16 sure that we got an answer.
17 1450
18 3478 What action should the Commission
19 take if it becomes clear that the targets are not being
20 met? You said you will give us an annual report and we
21 really need three years to sort of see how things are
22 working; it is a five-year plan, and it will take us
23 three years to see how it is working. What if it
24 doesn't work?
25 3479 MR. MACDONALD: Well, I guess the
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1 first question I would have is, what has really been
2 lost by trying? Because you haven't really given up
3 any of the regulatory tools that are there, as I said
4 earlier. We haven't asked you to walk away from any of
5 the stations that are on dollars, none of the stations
6 on hours would be any different. So those commitments
7 would continue, stations that are on hours will go to
8 six and a half and then seven hours, and the stations
9 that are dollars will move in the normal course of
10 averaging. So I don't see any downside, quite frankly.
11 3480 So at no point have we asked the
12 Commission to sort of shake the dice with us and back
13 off significant commitments that would put the system
14 or the regulator at a loss. What we are simply saying
15 is, without losing any of the existing commitments,
16 let's focus rather on more, more, more of the same
17 thing, spreading our resources thinner and thinner;
18 let's focus on the one thing that we need to try to
19 focus on together, which is audience.
20 3481 It has to be a partnership goal, it
21 has to be an industry goal, but I don't believe that
22 there is any downside to it.
23 3482 COMMISSIONER WILSON: Okay. I am
24 going to think about that.
25 3483 MR. BUCHANAN: Maybe I could add
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1 something, Commissioner Wilson.
2 3484 COMMISSIONER WILSON: Okay, Grant.
3 3485 MR. BUCHANAN: What do you do with
4 local reflection? A few years ago the Commission
5 decided to stop measuring it. It is still there. You
6 said when we came back for renewals you would still
7 hold us accountable for it. We were still supposed to
8 be focusing on it, and "We will see you at your licence
9 renewal."
10 3486 I guess it is the same kind of
11 approach to it. You still would like us to be doing
12 it, you don't want us to walk away from it, we share
13 our plans and our goals with you when we come before
14 you, and when it is over, it is an additional layer
15 that you can talk with us about when we come before
16 you. But, as Jim said, we are not suggesting it
17 replace anything or become the sole barometer of how we
18 are doing.
19 3487 MR. MACDONALD: The point is that if
20 we don't produce results it will be an experiment that
21 was a complete waste of time, but if we do produce the
22 results, then there is upside for everybody.
23 3488 COMMISSIONER WILSON: Okay. I would
24 like to go now to I guess one of the issues raised in
25 the CFTPA submission. There have been a lot of numbers
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1 quoted just in the last few days, and we have three
2 more weeks of this, so it will be interesting to see
3 how many more are presented.
4 3489 I am sure you are all aware that
5 Michael MacMillan, when it appeared for the CFTPA,
6 recalled for us that one of the strongest arguments
7 offered by broadcasters in favour of consolidation was
8 that the development of these multi-station ownership
9 groups would result in greater production and
10 exhibition of Canadian programming because the cost can
11 be amortized over a larger revenue base and there would
12 be economies of scale, efficiencies of resources or
13 whatever you want to call it.
14 3490 I think it was during the CAB
15 presentation on Wednesday that the phrase was used that
16 there is no pot of gold at the end of the consolidation
17 rainbow, and while we can certainly point to the
18 economic factors and continuing audience fragmentation
19 as the causes -- the figures that the CFTPA quoted, and
20 maybe you want to dispute those; this is your chance --
21 between 1993 and 1997, when much of this consolidation
22 was taking place, the broadcaster margins, according to
23 CFTPA's figures, increased from 12.7 to 17.3 per cent,
24 and during the same time period Canadian programming
25 expenditures by broadcasters dropped from 30.4 to 26.6
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1 per cent.
2 3491 Then I would like to just point you
3 to a statement that you make actually on the very first
4 page of your submission. It is a phrase, actually,
5 that you use that struck me; maybe it is because I am
6 such a new Commissioner that it struck me. In
7 reference to your licence renewals which took place, I
8 believe, a couple of years ago you say, "The regulatory
9 bargain is complete." I guess partially I have
10 difficulty with that phrase because it makes it sound
11 like this is just a big negotiation, "We are going to
12 sit down and you say what you want, we say what we
13 want, then we will decide and we will give you a period
14 of time, and off you go to do it."
15 3492 I guess I want to ask you if you feel
16 that the Commission allowed you to go ahead and
17 consolidate and develop multi-station groups, and that
18 was, to use your phraseology, their end of the bargain,
19 and your end of the bargain was to go off and to do
20 more programming and make a more significant
21 contribution. Yet the numbers that the CFTPA presented
22 to us would dispute that.
23 3493 MR. MACDONALD: I don't propose to
24 dispute the numbers, not because I don't have other
25 numbers, but the comment was made in a general sense
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1 relative to why consolidation has happened in the first
2 place.
3 3494 Consolidation has happened in the
4 first place because of the erosion of profit margin,
5 because programming has become a national game. You
6 can trace consolidation way back and you can see what
7 has been happening, not just in this industry but in a
8 number of different industries. And if others made
9 different commitments, then Mr. MacMillan is well
10 within his right to expect those companies to come
11 forward.
12 3495 As to WIC, WIC's expansion and its
13 growth, at every point in the turn it has paid
14 significant public benefits for the transaction which
15 have always been considered by the Commission because
16 the Commission has approved it to be suitable to the
17 size of the contribution.
18 3496 There was a comment this morning
19 about how WIC had expanded in Ontario without any kind
20 of local contribution, in Ottawa as an example. Well,
21 that was really by choice and design because there was
22 a concern raised about providing local coverage. But,
23 more importantly, WIC put $5 million in incremental
24 spending on the table as part of that transaction.
25 Similarly, when we applied to purchase Montreal, there
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1 were significant public benefits attached to that. So
2 in no case did we think that we were just acquiring
3 stations and not making a suitable commitment to the
4 transaction.
5 3497 So I guess, from our perspective, we
6 paid each step along the way to that consolidation, and
7 we did not certainly want to be conveying that, now
8 that we have paid, paid, paid, paid, paid, we are now
9 ready to do all kinds of extra over and above that.
10 3498 I know what WIC, as does the
11 Commission, spends as a percentage of our revenue on
12 Canadian, and we are only slightly behind CTV Baton.
13 So I have no qualms about what we are doing and how we
14 are doing it, but at no point I think from a WIC
15 perspective did we ever suggest that there was going to
16 be this big increase in what we were doing,
17 specifically as a result of consolidation.
18 3499 COMMISSIONER WILSON: I guess in some
19 ways that question is unfair because I am asking you to
20 comment on an industry-wide phenomenon and sort of
21 relate it back to your own experience, but that's --
22 3500 MR. MACDONALD: Well, you know, there
23 have been some commitments made in certain other
24 transactions. In fairness, you should talk to the
25 other broadcasters who made those commitments. But,
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1 from a WIC perspective, I think that first of all we
2 have continued to invest more and more, we have
3 continued to increase the number of projects that we
4 are doing on a national basis through WIC
5 Entertainment, and we have used each of our
6 acquisitions to in fact do more, but not in response to
7 anything -- "Allow us to consolidate and then there is
8 this big pot of gold." We never said that.
9 3501 COMMISSIONER WILSON: Thank you.
10 3502 I would like to move now to your
11 submission. One of the things that you talk about a
12 fair amount is the whole notion of scheduling of
13 Canadian programming. You suggest that whatever
14 regulatory approach we adopt going forward we should be
15 flexible enough that broadcasters aren't forced to
16 schedule Canadian programs at times when they will have
17 to compete with the much more popular U.S. programs.
18 3503 In making the case for scheduling
19 Canadian programming in other prime time or access day
20 parts, I think it is in paragraph 66, you draw the
21 distinction between available audience versus homes
22 using television. Yet, over a long period of time, it
23 has been quite well documented that the most people
24 watch the most television between 8:00 and 11:00, or
25 7:00 and 11:00 if you want to widen that. Even the
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1 viewing between 6:00 and 7:00 is significantly lower.
2 3504 So, given the fact that so many
3 people work during the day and many of them aren't
4 sitting down to do really serious television watching
5 in the morning unless they are kids, how do you expect,
6 through creative scheduling in alternate day parts and
7 promotion, that you can build the kinds of audiences
8 that will ultimately drive overall viewing to Canadian
9 programming to 35 per cent and viewing to entertainment
10 programming to 10 per cent, which were the goals that
11 were set by the CAB? I mean, if people aren't watching
12 television, then they are not really available. They
13 may be in the house, they may be available in the sense
14 that they are at home, but they don't watch at that
15 hour.
16 3505 MR. MACDONALD: First of all, I would
17 say we agree with you. We are not advocating trying to
18 create corridors where Canadian programming is
19 basically put out to pasture; that's not what we are
20 suggesting at all. But we are suggesting that there
21 are time periods beyond 8:00 to 11:00. As an
22 example --
23 3506 COMMISSIONER WILSON: "Mike Bullard"
24 I think is one of the examples that was offered on day
25 one.
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1 3507 MR. MACDONALD: I wasn't going to use
2 that because it is a good example -- it is a good
3 example, but it is sort of an exceptional example. I
4 would have used the 7:00-to-8:00 time period, a little
5 bit more of the WIC style argument.
6 3508 If you look at a 2-plus PVT, in other
7 words persons viewing television, at 8:00 p.m. it is
8 33.3; at 7:00 p.m. it is 28.1. So what we are saying
9 is, we agree with Mr. MacMillan's notion of fish where
10 the fish are, but let's recognize that when you have 84
11 per cent of the fish at seven o'clock, it might be a
12 good place to go putting your line in.
13 3509 COMMISSIONER WILSON: So is that why,
14 on your Edmonton schedule, for example, the one that
15 was provided to us this morning by Friends of Canadian
16 Broadcasting -- I mean, you do have big name programs
17 that are scheduled at seven o'clock; they are all U.S.
18 programs, but they are programs that draw I think a
19 fairly significant share: "Chicago Hope", "Star Treck
20 Voyager", "Beverley Hills 90210".
21 3510 Maybe you are demonstrating by
22 scheduling in that hour that that time block is
23 actually a good time block for programming.
24 3511 MR. MACDONALD: Of course, in
25 Alberta, we are dealing with a time zone difference
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1 anyway --
2 3512 COMMISSIONER WILSON: That's true.
3 3513 MR. MACDONALD: -- which is a bit of
4 a habitual thing. In Ontario, of course, we are
5 running primarily access programming in the 7:00-to-
6 8:00 time period.
7 3514 COMMISSIONER WILSON: What do you
8 mean by "access programming"?
9 3515 MR. MACDONALD: Access is called
10 "prime access" between 7:00 and 8:00, and access
11 programming would be shows like --
12 3516 COMMISSIONER WILSON: "Wheel of
13 Fortune" and "Jeopardy".
14 3517 MR. MACDONALD: -- "Wheel of
15 Fortune", "Jeopardy", "Hard Copy" and things like that.
16 We felt that, up against those strip shows, really good
17 Canadian shows could do very well.
18 3518 COMMISSIONER WILSON: I would agree
19 with that.
20 3519 MR. MACDONALD: That's why we
21 suggested that that was a corridor.
22 3520 I used the example I think the other
23 day, at six o'clock on Sunday, with one of our Canadian
24 shows a few years ago, we had experimented going up
25 against news, counter programming. So at six o'clock
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1 we win the time period, as opposed to taking the same
2 program and putting it at that time at eight o'clock up
3 against "Murder She Wrote".
4 3521 COMMISSIONER WILSON: Right. CHRO in
5 the National Capital Region has done the same thing.
6 3522 MR. MACDONALD: So those are the
7 kinds of circumstances that we envisioned. We are not
8 suggesting that development of a show like "Mike
9 Bullard" shouldn't count, not at all. That's
10 innovative. But at no time were we suggesting that
11 broadcasters be allowed to move away from prime time
12 commitments by running in day parts where there is no
13 audience.
14 3523 It is simply that I think you would
15 agree that at seven o'clock, where there is 80-plus per
16 cent of the available audience -- at seven o'clock 84
17 per cent, to be specific, of the 8:00 p.m. audience --
18 then that's a significant audience and it shouldn't
19 just be thrown away and counted as nothing.
20 3524 COMMISSIONER WILSON: Maybe I could
21 just ask you, I think one of the viewing shares that
22 was quoted was a 4 share versus the 20 share that
23 "E.R." got, by CAB -- I can't remember the specific
24 show that they were talking, "Traders" maybe. What do
25 you consider a successful viewing share for Canadian
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1 programming? Currently I think it is like between 3
2 and 4, isn't it, for most --
3 3525 MR. MACDONALD: It can get very
4 confusing between share and rating points. I would say
5 that the average -- I think we are doing fairly well
6 with a Canadian show that does better than a 3 rating,
7 which would be a per cent of that particular
8 demographic in that particular market. "Outer Limits",
9 as an example -- which is the number one Canadian show
10 in Toronto according to Nielsen -- would do a 6 rating.
11 By comparison, "North of 60", which is the 17th ranked
12 show, would do a 3.5 rating; and that's against adults
13 25 to 54. If you look at our show that's on CBC,
14 "Emily of New Moon", against that same target group it
15 does a 2.2 rating. So that essentially says that
16 "Emily of New Moon" is seen by 2.2 per cent of the
17 adults in the Toronto DMA between the ages of 25 and
18 54.
19 3526 So that's the range that we are
20 seeing.
21 3527 COMMISSIONER WILSON: And what would
22 allow you to break even on a Canadian program? Of
23 course, I know that there are a lot of things that go
24 into that, like convincing the advertisers to buy spots
25 and to pay more for them and all of that, but --
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1 3528 MR. MACDONALD: Well, an advertiser
2 won't pay more for a spot because it is a Canadian
3 program.
4 3529 COMMISSIONER WILSON: No, but for the
5 share or the rating.
6 3530 MR. MACDONALD: Right. The general
7 notion -- I mean, advertisers will pay for rating
8 points and they will typically want to make sure that
9 there is a rationale to the basis of the estimates that
10 are done.
11 3531 COMMISSIONER WILSON: Do they pay the
12 same amount, though? I think one of the examples that
13 CFTPA presented was that the ratings for "Chicago Hope"
14 and "Cold Squad" are identical; they are between 11 and
15 15, ratings or share, I can't remember, I am sorry, but
16 they were identical.
17 3532 Would an advertiser pay the same
18 amount for an ad spot in "Cold Squad" as they would for
19 "Chicago Hope"?
20 3533 MR. MACDONALD: I can answer that
21 specifically by telling you that the audience level for
22 "Chicago Hope", again against the same demographic, is
23 a 6.5 rating versus "Cold Squad" at a 4.4. So the
24 answer is, no, they would pay more for "Chicago Hope".
25 3534 But if they were the same --
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1 3535 COMMISSIONER WILSON: If they were
2 identical?
3 3536 MR. MACDONALD: -- sure, they would
4 pay the same.
5 3537 COMMISSIONER WILSON: They would.
6 3538 MR. MACDONALD: Advertisers are in
7 the business of buying rating points and they will
8 consider the environment for their clients -- certain
9 environments are more conducive than others, but
10 certainly I think that we are well beyond the issue of
11 advertisers penalizing Canadian programming.
12 3539 COMMISSIONER WILSON: We are beyond
13 that?
14 3540 MR. MACDONALD: I believe so, but
15 there is still going to be an element of show me and
16 prove it. So, if we had a legitimate number, would
17 Baton be able to go out and sell "Cold Squad" at 4.4
18 ratings, and the answer would be, well, they would
19 round it down to 4, but they would get paid for a 4
20 rating.
21 3541 COMMISSIONER WILSON: Okay, thanks.
22 3542 Another one of the areas that you
23 deal with in your submission is the whole issue of the
24 value of news and public affairs programming.
25 3543 I am not usually giving long
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1 preambles, but I am going to kind of do a long preamble
2 on this one.
3 3544 Would you agree that, as a
4 conventional broadcaster -- no, actually, I am going to
5 ask you a question first and then I am going to do some
6 preamble.
7 3545 Would you agree that, as a
8 conventional broadcaster, your strongest link to your
9 communities is through news? In fact, that is the
10 thing that differentiates you as a conventional
11 broadcaster from pay services, from specialty services.
12 That's the thing that allows you to establish some kind
13 of a relationship with your community, your audience,
14 and develop a loyal viewership.
15 1510
16 3546 MR. MACDONALD: Absolutely.
17 3547 COMMISSIONER WILSON: Okay. So at
18 paragraph 86 --
19 3548 MR. MACDONALD: Now that you have got
20 me into the trap, I'm ready.
21 3549 COMMISSIONER WILSON: At paragraph 86
22 of your submission, you say:
23 3550 "News Hour at BCTV is the third
24 largest news cast in North
25 America and Pulse News at CFCF
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1 generates a significant share of
2 tuning. With the exception of
3 Ontario, WIC stations rank
4 number one or two in news in
5 each of their markets."
6 3551 Then at paragraph 63 you state WIC
7 currently generates unacceptably low margins in its
8 news. The CAB shows that on a direct basis, news as a
9 category generates a 16 per cent profit margin. I
10 don't know if you want to give us this figure right now
11 or later.
12 3552 I am interested to know what your
13 direct cost margins are in comparison to that. I was
14 interested to know what unacceptably low meant.
15 Considering the high praise that you gave your
16 newscasts in paragraph 86, I just wondered what
17 unacceptably low meant.
18 3553 MR. MACDONALD: Well, if you wouldn't
19 mind, Commissioner Wilson, I would like to file that
20 with you confidentially.
21 3554 COMMISSIONER WILSON: Okay.
22 3555 MR. MACDONALD: But I am more than
23 happy to give you the number. I think that the margin
24 that is of concern to us is you have got two leaders in
25 CFCF and BCTV. As we said in our comments on TV, it is
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1 quite a different circumstance.
2 3556 COMMISSIONER WILSON: Sure.
3 3557 MR. MACDONALD: It's effectively
4 competing in the Toronto market without any of the
5 clients or the resources of the Toronto market and,
6 quite frankly, there aren't that many people in Toronto
7 that are typically going to look to a Hamilton station
8 for their news, to say nothing of the fact that we made
9 a commitment to the Commission when we expanded
10 Hamilton to keep the local newscasts focused locally.
11 3558 There are stations where we are not
12 making money on news, but we will file with you the
13 specific, both direct and fully allocated costs for
14 news in the margins.
15 3559 COMMISSIONER WILSON: Okay. I guess
16 the second part of that for me is in paragraph 63. You
17 also say it is by no means guaranteed that WIC would
18 continue would continue with its chosen strategy of
19 news excellence if the currency of that chosen category
20 were to be devalued by the Commission.
21 3560 You said yes, that you have a strong
22 business incentive to do news, that's one of the ways
23 that you develop loyalty in your community. How would
24 that be in your business interests not to do a really
25 good job on news?
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1 3561 MR. MACDONALD: We have said that
2 that has been one of the factors that WIC has tried to
3 use to try to differentiate ourselves from everybody
4 else. Even though we have tried to create a branding
5 which associates each of our stations with the parent
6 company, with WIC, we have never tried to develop WIC
7 as a parent brand, so to speak, or the primary product.
8 3562 We are not CTV, we are not Global.
9 We are ITV. It's ours. We are CITC, the spirit of
10 Calgary. We are BCTV, TV for B.C. That has been the
11 primary focus. There would be absolutely no reason we
12 would back off our news commitments in those areas
13 where it made sense to do so.
14 3563 We are not profitable in all of the
15 markets. If all of a sudden we had to by direction be
16 told "Okay, your percentage on 7,8 and 9 is X and it
17 needs to go to Y", we have to look at that in the
18 context of the overall business plan because at the end
19 of the day, we can only do as much as we can do based
20 on the margins that we are going to be able to present
21 to our shareholders.
22 3564 Either revenue goes up, and it
23 certainly -- you know what's happening with revenue --
24 or expenses go down and we have completely restructured
25 the company so we have been able to absorb new
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1 competition in three of our key markets, but we are
2 quickly running out of tricks.
3 3565 If all of a sudden we were told that
4 incremental to our news spending was going to be
5 another 3 or 4 per cent of revenue that had to be spent
6 on 7, 8 and 9, that would be a significant amount of
7 money.
8 3566 COMMISSIONER WILSON: I guess the
9 feeling that I got because that point was made numerous
10 times in the submission was like, you know, we might
11 not do it. In fact you are required to do it.
12 3567 MR. MACDONALD: I'm sorry?
13 3568 COMMISSIONER WILSON: You are
14 required to do this.
15 3569 MR. MACDONALD: Absolutely.
16 3570 COMMISSIONER WILSON: So it's not
17 like it's a choice you could just automatically make
18 yourself to say no, we are not going to do news.
19 3571 MR. MACDONALD: No, but everything I
20 think was put within the context of the existing
21 licence term. We made very firm commitments. We have
22 lived up to those commitments. We will continue to
23 live up to those commitments.
24 3572 We were talking about the going
25 forward position. We have to -- if the rules change,
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1 then maybe nothing changes. Maybe we simply say we
2 have to figure out a different way to cast this, but
3 clearly, as soon as there are business reasons that
4 change the dynamic of how your business runs, then you
5 have to go back and look at the sum of the parts.
6 3573 Our concern, quite frankly, was that
7 the focus seemed to be so singularly on three
8 categories that --
9 3574 COMMISSIONER WILSON: The focus in
10 the public notice or just in sort of the trend.
11 3575 MR. MACDONALD: The trend and the
12 interveners and the tom-toms and the notice was
13 certainly indicative of that. We just didn't want the
14 focus to be lost on the importance of exactly the
15 points that you made earlier, that it is the connection
16 that we have with our local audience, it is what makes
17 us unique from everybody else. Otherwise, why have a
18 local station? You can beam it in by satellite or
19 cable or whatever.
20 3576 COMMISSIONER WILSON: At paragraph 52
21 of your submission you say:
22 3577 "The system will only be able to
23 meet national public policy
24 objectives if the participants
25 in the system are allowed to
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1 focus their resources on
2 targeted areas, and to maintain
3 sufficiently large audiences in
4 those areas so that there is at
5 least the potential for
6 promotional leverage to other
7 areas within the system."
8 3578 Then you go on to say in paragraph
9 54, and this is similar to the question that I asked
10 you when you appeared as part of the CAB presentation,
11 that broadcasters should be allowed to concentrate
12 their efforts on the specific genres of Canadian
13 programming that they can do most effectively and that
14 those genres may not be the same for each broadcaster.
15 3579 I think I asked you if what you were
16 suggesting was sort of a hybrid conventional specialty
17 service, at least in prime time. I should have made
18 that distinction.
19 3580 I just wonder if you could explain to
20 me how this would work. I mean, what would your
21 stations look like compared to what they look like now
22 if you were going to choose a different genre besides
23 drama?
24 3581 MR. MACDONALD: In our case they
25 wouldn't look a lot different because we have decided
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1 to concentrate on the two areas of news and drama.
2 3582 COMMISSIONER WILSON: Okay. Pretend
3 that you didn't choose that. Pretend that you are
4 choosing documentaries or another category. What would
5 the channel look like? I am just trying to figure out
6 what would other broadcasters do.
7 3583 MR. MACDONALD: Well, then you would
8 have a lot more documentaries, that's for sure.
9 3584 COMMISSIONER WILSON: I love
10 documentaries.
11 3585 MR. MACDONALD: We clearly supported
12 the idea that documentaries be included in the
13 satisfaction of 7, 8 and 9 but they tend to be one off
14 programming as opposed to a series.
15 3586 COMMISSIONER WILSON: Right.
16 3587 MR. MACDONALD: But that provides its
17 own promotional opportunity.
18 3588 COMMISSIONER WILSON: Right, but
19 that's not answering my question.
20 3589 MR. MACDONALD: But I think that it
21 depends on which genres different people go after and
22 Commissioner Wylie asked a number of questions related
23 to diversity in the opening day. We feel that in many
24 ways the singular focus on 7, 8 and 9 -- I mean 7, 8
25 and 9 are fairly broad categories, so we are not
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1 suggesting that you move away from 7, 8 and 9.
2 3590 We are really suggesting that there
3 be some expansion, but the competitive factors between
4 the groups are going to make sure that everybody is not
5 doing the same thing. We are all going to be looking
6 for certain genres.
7 3591 Mr. McCabe said is there going to be
8 a lot of expansion in sports and news and I think that
9 generally the conclusion we came to was no, there
10 wouldn't be because it wouldn't make any competitive
11 sense to do that. There are two 24 hour news services,
12 two 24 hours sports services or will be very shortly.
13 3592 Where do we fit in? We felt that
14 many of the stations would focus on hopefully the
15 broader categories of 7, 8 and 9 but documentaries will
16 change the look very significantly. More will do
17 movies. I mean one of the things that we had started
18 to do with in WIC was the vertical integration between
19 our pay operation and our television operation, so we
20 have committed to several movies that will have their
21 first home on pay and then move to WIC because we
22 decided to introduce another movie --
23 3593 COMMISSIONER WILSON: They will roll
24 our in the orderly marketplace.
25 3594 MR. MACDONALD: That's right, such as
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1 it is or such as it may be for WIC. The point is that
2 we had chosen to do more movies because we felt it made
3 sense for us to do that and the kind of movies that we
4 were doing were very different from the kind of movies
5 offered by some of our competitors.
6 3595 I'm not sure that the differences
7 will be enormously obvious, but I think that there will
8 be subtleties that will change quite differently.
9 3596 MR. BUCHANAN: It really depends on
10 what you believe the problem you are trying to fix is
11 if you think there is a problem to be fixed. In your
12 case, if you think there aren't enough documentaries,
13 then we can fix that by making it something that gets
14 measured as part of the commitments that we already
15 have to you to do 7, 8 and 9 in the stations where we
16 have chosen 7, 8 and 9, for example.
17 3597 COMMISSIONER WILSON: Okay.
18 Paragraph 81 in your submission. I just have three
19 more questions for you. You suggest that U.S.
20 specialties and certain commercially-driven exempt
21 services should be required to contribute to the
22 Canadian broadcasting system and you attach as Schedule
23 3 a document that addresses both closed circuit video
24 programming and teleshopping undertakings, but it
25 doesn't explore the notion of extracting a contribution
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1 from U.S. specialties.
2 3598 I wonder if you could just expand on
3 this suggestion. Do you have any ideas about how you
4 might do it or how much it might be?
5 3599 MR. MACDONALD: If you look at -- if
6 we look across the board at subscription revenues that
7 are currently going into the U.S., we see that in 1997
8 there was about $78 million of subscription that went
9 south. Over and above that, I believe that we are
10 seeing approximately $20 million in Socan fees that are
11 going as distant signals.
12 3600 I will just check with Ken to make
13 sure that's -- Ken says more like $35 million, the
14 point being --
15 3601 COMMISSIONER WILSON: Did you have
16 your mike on when you said that because we will need
17 that for the transcript, the 35 I mean.
18 3602 MR. BUCHANAN: We might want to
19 correct it before it gets too far on. The number going
20 south would need to be explored out of the Copyright
21 Board regime because it's not only Socan distant
22 signal. It's a blend. It's not all attributable to
23 the U.S. signals. It's attributable to programs on
24 Canadians and so on so it wouldn't want to go too far,
25 but this is a real number.
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1 3603 COMMISSIONER WILSON: Okay.
2 3604 MR. BUCHANAN: This one is the
3 subscription fees paid by Canadian cable for the
4 carriage of U.S. signals on the eligible list in
5 Canada. That's real money.
6 3605 MR. MACDONALD: We look at that and
7 say what would the Commission expect from a Canadian
8 broadcaster in terms of contribution to the system. We
9 are no different -- I mean, this is not an original
10 idea because many have suggested it, but we think that
11 if we are able to extract a contribution to the cable
12 fund from specialty services going on in the future,
13 then that can be a major contribution.
14 3606 We recognize that there are trade
15 issues. We recognize that it can't be done by the
16 Commission arbitrarily, but as we move forward to the
17 digital era, we suppose that there will have to be a
18 new licensing approach to digital and we believe that
19 may open up the opportunity for the Commission to say
20 to themselves is there an opportunity here for us to in
21 fact extract some kind of a contribution from those
22 U.S. specialties that are gaining enormous benefit out
23 of Canada and not contributing anything.
24 3607 COMMISSIONER WILSON: How would you
25 feel if you had to make a contribution to the U.S. in
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1 the opposite circumstance if you owned a specialty or
2 pay television service --
3 3608 MR. MACDONALD: Well, most of them
4 can't believe their good luck in coming into this
5 country with absolutely no cost whatsoever. It is
6 brought in and all they get is a cheque. In fact, I
7 think the funniest story I will recount to you was from
8 a U.S. shareholder that was involved in a Canadian
9 application who went through the entire process of
10 filing the application, going through all the meetings,
11 all the hearings and everything else, finally to be
12 given a licence, not to be able to initially get
13 launched and then find out that a service they owned
14 100 per cent of was added automatically when they got
15 back to the shop.
16 3609 I would say that most of these
17 services can't believe their good luck. I think that
18 nobody is wanting to give away more than they need to
19 do. The question is should U.S. services be able to
20 come in here with no commitments whatsoever to the
21 Canadian broadcasting system.
22 3610 Since we are extracting a tithe from
23 each of the Canadian broadcasters and since we are
24 really going more and more to an open border situation,
25 we simply look at this and say we have to be cognizant
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1 of every opportunity to put more money into our system
2 and that's one that we would suggest.
3 3611 As far as the teleshopping, I am
4 going to ask Grant to talk about that.
5 3612 MR. BUCHANAN: I think we did that.
6 3613 COMMISSIONER WILSON: That was
7 covered. That was good. I don't really need to know
8 any more about the teleshopping.
9 3614 MR. BUCHANAN: To finish that answer,
10 yes, if we could get the kind of carriage in the U.S.
11 that they get here for our services, we would be
12 delighted to pay a tithe.
13 3615 COMMISSIONER WILSON: Okay.
14 Infomercials, I have just got to ask you, in spite of
15 what Commissioner Wylie said about how much she likes
16 infomercials.
17 3616 THE CHAIRPERSON: I like to be
18 educated.
19 3617 MR. MACDONALD: It's educational
20 programming now.
21 3618 COMMISSIONER WILSON: Yes. It's a
22 new category.
23 3619 I can certainly, and I should say
24 finally because someone had to explain this to me, I
25 understand that counting infomercials as Canadian
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1 content might satisfy industrial objectives, but I need
2 a bit of help on the issue of how that might satisfy
3 cultural objectives in the system.
4 3620 I'm just wondering, or is anybody
5 purporting that counting infomercials as Canadian
6 content is going to satisfy any cultural objectives at
7 all?
8 3621 MR. BUCHANAN: Thank you for the
9 question.
10 3622 Yes. They come in so many varieties
11 it boggles the mind. What started out as slice and
12 dice late night fare has graduated to the point now
13 where major corporations are doing infomercials that
14 are better than half hour shows that you watch that do
15 qualify as programs.
16 3623 Some of the stuff you see that is
17 produced by these corporations that are infomercials
18 that describe their charitable works and so on have
19 nothing other than their logos at the beginning and the
20 end. They are not pitches all the through with the
21 seven minutes sales. There is some wonderful
22 programming out there.
23 3624 Now, that is not all infomercials,
24 but I tell you, when you see the demographics of the
25 people who watch them and use them -- I won't speak
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1 directly to the Chair here -- it is not at all what you
2 would expect. There are all kinds of people who enjoy
3 them. It is quite a wide range. We did a lot of
4 research when we brought those applications forward.
5 3625 If the Commission was concerned for
6 some reason that they might not satisfy the kind of
7 objectives, put a cap on it, but to totally preclude it
8 we thought was wrong for a considerable period of time.
9 3626 COMMISSIONER WILSON: How many of
10 these are being produced by Canadians right now? Do
11 you have any idea?
12 3627 MR. BUCHANAN: Very few because the
13 way it's set up now is you can't count it as Canadian
14 content. What you effectively do is you have to trade
15 off the half hour. You have to take your lowest rated
16 U.S. program and decide whether you are better to take
17 a Canadian infomercial and put it on.
18 3628 MR. MACDONALD: Don't you think that
19 the floaty did a nice job?
20 3629 COMMISSIONER WILSON: What is that
21 like, some kind of spray-on hair or something like
22 that?
23 3630 MR. MACDONALD: No. That's the
24 cutter that you hook up to the vacuum cleaner.
25 3631 MR. BUCHANAN: We should finish this
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1 thought.
2 3632 COMMISSIONER WILSON: Well, actually,
3 you know what I was going to -- no, we probably
4 shouldn't.
5 3633 MR. MACDONALD: We don't do the other
6 side.
7 3634 MR. BUCHANAN: Not that thought. The
8 thought that there's a lot of room for genres other
9 than 7, 8 and 9 that have an appeal to people. That's
10 really the central message we are trying to deliver
11 today. Don't direct someone here because you will end
12 up neglecting over here.
13 3635 COMMISSIONER WILSON: That message is
14 received loud and clear.
15 3636 MR. BUCHANAN: Thank you.
16 3637 COMMISSIONER WILSON: I wonder if I
17 could ask you to put on file with us one of these
18 wonderful infomercials you have seen as you were doing
19 your research. I would love to see something that you
20 would consider better than some other programming. I
21 need to be able to visualize that on a concrete basis.
22 3638 MR. BUCHANAN: We would be happy to
23 do that.
24 3639 COMMISSIONER WILSON: Thank you.
25 3640 This is my final question and this
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1 one does have a big preamble.
2 3641 I just want to ask you about your
3 comments about direct access to the equity investment
4 program by broadcasters or broadcaster controlled
5 production funds.
6 3642 You state at paragraph 149:
7 3643 "It is incongruous that large
8 producers with significant
9 ownership interests in
10 broadcasting undertakings are
11 permitted to access these funds
12 and yet broadcasters with
13 production interests are not."
14 3644 Interestingly, I guess it was Ian
15 Morrison from Friends who made a comment about this and
16 said this is really not the same thing as the cable
17 companies being prevented from holding specialty
18 licences and that kind of thing. I guess you guys do
19 have something in common from time to time.
20 3645 You go on to say:
21 3646 "The Americans have clearly made
22 a policy decision to enable
23 their massive integrated
24 production, broadcasting and
25 distribution entities to
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1 dominate the world marketplace."
2 3647 Earlier in your submission at
3 paragraph 11 you also raised the issue of the
4 integrated U.S. networks, but there you talk about the
5 potential negative effects that this move could have on
6 the Canadian broadcasters' ability to purchase
7 programming rights.
8 3648 I guess it struck me listening to the
9 CFTPA's concerns about the gatekeeping role of
10 broadcasters in Canada that you might well find
11 yourself in a similar position with the U.S. networks
12 that whereas the independent producers in Canada see
13 you as a gatekeeper to their profitability as an
14 industry, the U.S. networks could well become
15 gatekeepers to your profitability as an industry.
16 1530
17 3649 On the one hand, you recognize the
18 inherent difficulties associated with what has happened
19 in the U.S. because it could have a very direct effect
20 on your bottom line, but on the other hand you would
21 like some of the same thing to happen here.
22 3650 I guess it just kind of reminded me
23 of that old picture of the big fish eating the littler
24 fish, eating the littler fish and the only way -- there
25 are a lot of analogies being thrown around during this
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1 hearing as well.
2 3651 MR. MACDONALD: There are a lot of
3 fish stories.
4 3652 COMMISSIONER WILSON: A lot of fish
5 stories. It was this big.
6 3653 I am wondering if you could comment
7 on that?
8 3654 MR. MACDONALD: And what would appear
9 to be a totally hypocritical comment?
10 3655 COMMISSIONER WILSON: Yes.
11 3656 MR. MACDONALD: I would -- first of
12 all, we stand by the comments made about the U.S. That
13 happens to be reality. I think it is a very good and a
14 very fair comment to be saying if it's a problem there,
15 why wouldn't it be a problem here.
16 3657 In fact, if you look back and say why
17 did we get into this issue of independent producers in
18 the first place, it was really because of the vertical
19 integration that existed at that time in the
20 broadcasting industry in Canada. We started and we
21 created an independent production sector, which was
22 quite different than it is today. The independent
23 producers back then were very different than what
24 independent production has evolved to, at least in
25 certain sectors. We now have some fairly large
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1 publicly owned independent producers.
2 3658 We say in recognition to the point
3 that you bring up that it would be fair to put some
4 kind of a cap on it, but that we certainly don't
5 believe that we should be precluded from making those
6 kinds of investment or becoming distributors. In fact,
7 we would be prepared to put more money in.
8 3659 Right now we are dealing with a
9 situation that if we get anything back from investments
10 that we have to respend it if we are on dollars and
11 that seems pretty obtuse, quite frankly. Why would
12 anybody do it? You have to spend it until you lose it.
13 It is sort of like doing it in Vegas.
14 3660 Our view here is that we would like
15 to see some of those rules changed for the singular
16 purpose of getting more money into the system.
17 Producers have become broadcasters and broadcasters
18 should be able to get into the distribution and
19 production side. We think that it's fair. WIC feels
20 that it is certainly fair to put some kind of a cap on
21 it.
22 3661 COMMISSIONER WILSON: Have you
23 thought about what kind of impact that might have on
24 the independent production sector in Canada, I mean the
25 small to medium-sized producers?
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1 3662 MR. MACDONALD: I think if you look
2 at the licensing of when Alliance was licensed for
3 their specialty services there were commitments that
4 were undertaken in terms of that integration.
5 3663 COMMISSIONER WILSON: Right.
6 3664 MR. MACDONALD: I think the same kind
7 of thing happened with --
8 3665 COMMISSIONER WILSON: They are not
9 really a small or medium-sized company though.
10 3666 MR. MACDONALD: Atlantis.
11 3667 COMMISSIONER WILSON: Now they are
12 big.
13 3668 MR. MACDONALD: That's our point.
14 But they were asked to enter into commitments that made
15 sure that there was access for other people and I think
16 those are good guidelines to start.
17 3669 Do we think that the overall impact
18 on the smaller producers -- it's difficult to really
19 identify that because if you adopt 7, 8 and 9, the
20 expanded 7, 8 and 9 as recommended with documentaries,
21 that's going to open up a whole new opportunity for a
22 lot of the regional producers and a lot of the smaller
23 producers.
24 3670 A lot of the major projects are done
25 by the bigger companies now. So, there is no question
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1 that there would be less, quote/unquote, "shelf space"
2 for independent producers under that regime and it
3 would be made more competitive, but we are suggesting
4 that a cap, or at least allow broadcasters the
5 opportunity to get in is fair.
6 3671 We are not suggesting that you go and
7 again I am speaking for WIC here, I am not suggesting
8 that you go to the extent that the U.S. model has,
9 which is the full -- they can go to 100 per cent if
10 they want. The truth of the matter is that independent
11 producers produce damn good projects and you would be
12 very silly to try to put all the development,
13 everything in your camp.
14 3672 When we do projects with Atlantis or
15 Alliance, it is because they have got an amazing
16 development operation because they have got good
17 projects, they have got good writers, they have got
18 good talent. We have to really look at that very
19 carefully because it is easy to say, "Well you just do
20 it," but the investment that each of these networks is
21 having to make is enormous. So, I do think that we
22 would get into some projects on our own, but the vast
23 majority in our case would still be through independent
24 producers.
25 3673 COMMISSIONER WILSON: I want to thank
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1 you for the time. I know I kept you a lot longer, but
2 I felt that in view of where you are headed that you
3 would feel maybe a little less constrained about
4 sharing your views with us at this point on this
5 particular topic.
6 3674 MR. MACDONALD: Do you know where we
7 are headed?
8 3675 COMMISSIONER WILSON: I have no idea.
9 3676 MR. MACDONALD: It would help us
10 here.
11 3677 COMMISSIONER WILSON: I am new here.
12 But thank you very much, that was very useful.
13 3678 THE CHAIRPERSON: Commissioner
14 Pennefather.
15 3679 COMMISSIONER PENNEFATHER: I just
16 wanted to be sure that I got the message, as you were
17 saying before. Throughout your presentation and in
18 discussions with Commissioner Wilson and again even in
19 the Executive Summary, we see that our view would be to
20 allow the broadest possible flexibility, so that the
21 system can enjoy the broadest possible diversity.
22 Example, broadcasters should be required to have their
23 scheduling options so we do not feel broadcasters
24 should be required to have scheduling options so
25 constrained.
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1 3680 The gist of this then is greater
2 flexibility and do you feel that this will result in
3 more Canadian programming? Is that Canadian
4 programming going to be throughout the day or in prime
5 time?
6 3681 MR. MACDONALD: First of all, I don't
7 think that anything we are recommending is going to
8 result in more Canadian programming. We have looked at
9 more on a system-wide basis and we have said that more
10 has come from the specialties, the more hours the more
11 dollars. We are trying to focus on making a smaller
12 number of programs work better.
13 3682 COMMISSIONER PENNEFATHER: In any
14 time where you think it works best?
15 3683 MR. MACDONALD: For us, we have tried
16 a number of different things. We have tried, as an
17 example, the development of daytime talk shows. We
18 developed the "Jane Haughton Show" and we made it
19 successful. We jointly did it with WTN, but it was a
20 show that was perfect for WTN and they were able to
21 give it the wings and move it forward.
22 3684 We decided at that time that really
23 where WIC had to compete was in prime time. That's
24 where we needed to put our resources. So, we decided
25 to focus in that area.
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1 3685 It is also fair to say that WIC has
2 concentrated on more international-type projects or
3 global projects, as the Commission has referred to
4 them, which means that we are ultimately going to run
5 more because the 150 doesn't work for us as well as it
6 works for other companies. So I guess in that sense
7 there is going to be more. But overall we are not
8 advocating more. We are advocating doing it better.
9 For WIC it will be primarily in prime because that's
10 where we are focused.
11 3686 We are just saying that out of this
12 whole hearing has come sort of a clamouring for do
13 more, make it more specific, make it more this, make it
14 more that, which we believe is in sharp contrast to the
15 strategic plan that the Commission outlined. We are
16 saying work with us, don't give up anything you have
17 got in terms of current controls, but work with us to
18 get to the point that really is critical. We have got
19 to have more viewers.
20 3687 COMMISSIONER PENNEFATHER: Therefore,
21 that flexibility is required.
22 3688 MR. MACDONALD: Yes.
23 3689 COMMISSIONER PENNEFATHER: One quick
24 question, Commissioner Wilson brought our attention to
25 your schedule here and you said you would run a
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1 Canadian show well in the 7:00 to 8:00 period against
2 the shows that are here, "Star Trek" and -- what kind
3 of show would you be looking at to do?
4 3690 MR. MACDONALD: Are you looking at
5 the Calgary schedule or the Edmonton?
6 3691 COMMISSIONER PENNEFATHER: The
7 schedule that Commissioner Wilson brought just as an
8 example in Edmonton, where you said that you felt that
9 running a Canadian program -- if I understood you
10 correctly, running a Canadian program from 7:00 to 8:00
11 would be good, would work well in terms of getting
12 audiences, viewers for Canadian programs.
13 3692 MR. MACDONALD: You will notice as an
14 example, if we are working on the same schedule, that
15 "Stargate" which is running on Thursday at eight
16 o'clock could probably do very well where "Star Trek
17 Voyager" is. "Night Man," which is also running at
18 eight o'clock on Saturday could probably do better in
19 an earlier time slot.
20 3693 All we are really saying is let's be
21 mindful of the fact that you have to have -- there has
22 to be an audience there period, but there are different
23 corridors where there is a significant audience and not
24 necessarily the same competition. All we are really
25 looking for is asking the Commission to familiarize
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1 themselves with those kinds of corridors and allow us
2 the flexibility to go after them.
3 3694 COMMISSIONER PENNEFATHER: Okay. I
4 can say too that Commissioner Wylie admitted she was
5 interested in infomercials. I happen to be a trekkie,
6 so I notice a theme here moving into the audiences who
7 are following "Star Trek". Thank you very much,
8 gentlemen.
9 3695 MR. MACDONALD: Thank you.
10 3696 THE CHAIRPERSON: Commissioner
11 McKendry.
12 3697 COMMISSIONER McKENDRY: Thank you,
13 Madam Chair.
14 3698 When I was listening to the
15 presentation by the Canadian Association of
16 Broadcasters I was perplexed and rather than direct
17 this question to the Association, I am directing it to
18 the people who are actually out there doing it because
19 I think you are the people who can best answer the
20 question for me.
21 3699 I think actually in your comments
22 today you have cleared up for me a lot of what was
23 causing me to be perplexed, so I want to clarify that
24 with you and then I have a question that flows from
25 that.
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1 3700 Why I was perplexed when I was
2 listening to the CAB presentation was that there were a
3 number of overhead slides that showed significantly
4 increasing expenditures on Canadian programming over
5 the last few years, an increasing number of channels
6 and so on. But the one that I found most interesting
7 in relation to that was the one that was headed
8 "Canadian Viewing Shares Flat" and the Canadian viewing
9 share, according to this, has been flat over several
10 years.
11 3701 What I asked myself was, to be frank,
12 what were you guys doing? I mean, you are in the
13 business of getting audience and all that money is
14 being spent and audience share is just staying flat.
15 3702 Now, I think what you said today is
16 that in effect there was benign neglect. You could
17 subsidize or cross-subsidize some very profitable U.S.
18 programming and you really didn't need to worry about
19 that because your bottom lines were sufficient in light
20 of the high margins on U.S. programming. Your
21 shareholders were happy as things went along.
22 3703 I understood you to say to
23 Commissioner Wilson that things have now changed, that
24 isn't the situation any more. The market is
25 fragmented, the margin on U.S. programming has fallen
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1 due to competition, so now you need to get audiences.
2 3704 I guess what I am going to ask you,
3 assuming -- have I described the situation correctly?
4 3705 MR. MACDONALD: Yes, but I want to
5 come back to the words "benign neglect" because I think
6 that my colleagues at Global, as an example, have done
7 an exceptional job in their promotion of "Traders" and
8 Baton have done an exceptional job on "Cold Squad."
9 Those are projects that are I thin more recent, but the
10 Canadian paradigm that we are talking about goes back
11 several years. It is not just the last -- it goes back
12 a long time.
13 3706 So, you are correct, but I just want
14 to make sure that you knew that we have been starting
15 to move towards improvement over the last couple of
16 years.
17 3707 COMMISSIONER McKENDRY: Now, if it is
18 market forces that are changing the situation, market
19 fragmentation, competition, why do you need me and
20 seven other government officials to come in and say
21 here are the audiences you should attract? Why
22 wouldn't you do that on your own? Why do you need help
23 or incentive from us to attract audiences if this is
24 what the market is telling you? Why wouldn't you as
25 managers of this business say we are going to go out
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1 and get some audience? Why do you need us to tell you
2 what size that audience should be? Isn't the incentive
3 there? Isn't the market creating the incentive for
4 you?
5 3708 MR. MACDONALD: I think what we are
6 saying is that there is one thing that has in addition
7 to what I outlined to you, the business reality of
8 margins, there is another reality that is very, very
9 important and that is that Canadian programming has
10 gotten a heck of a lot better.
11 3709 I think that we have proved very
12 clearly that when Canadian producers and directors and
13 talent are working with similar budgets we can produce
14 a very, very competitive product. So, that's a big
15 change in the dynamic as well.
16 3710 What we are saying is in response to
17 the clamouring to make them to do more, make them do
18 more. We want to focus on exactly the issue that you
19 brought up and that is to recognize what we have got to
20 do and get on with doing it. So much of our problem
21 has been that our resources are spread so thin because
22 we have had quantitative commitments that we have
23 always had to meet and then we are trying to ensure
24 that the quantitative commitments don't continue to
25 escalate, so that we can't really work on the
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1 qualitative aspects of what we have got to do. That's
2 it in a nutshell.
3 3711 We just want to get on with making
4 the audience development happen, as opposed to have to
5 deal with more and more and more tonnage, which just
6 continues to exacerbate a problem that is already
7 there.
8 3712 COMMISSIONER McKENDRY: If I
9 understand correctly your views, you ultimately would
10 like -- I realize you are not throwing out the existing
11 regulatory system, but as I understand it you would
12 like to have evolve a regulated target for audience
13 share.
14 3713 What I am driving at is given the
15 market that you have described to us, why do you need
16 me and my colleagues to do that for you?
17 3714 MR. MACDONALD: Well, it comes back,
18 Commissioner McKendry, to the leadership issue that I
19 brought up at the beginning. I mean, what happens in
20 any company is driven from the top and whatever the
21 priorities of that company are established from the
22 top. We are hoping that the Commission will establish
23 audience as an important priority because if the
24 Commission establishes it as a priority, then it will
25 be a priority for your licensees. It will be a known
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1 priority to your colleagues in other ministries and
2 that we tried to move the bench marks forward on that
3 basis. Certainly audience is measurable.
4 3715 We think that unless we put it up on
5 a pedestal and that we move forward with that as an
6 underscored part of what we are trying to do together
7 that it will just get lost in the shuffle.
8 3716 COMMISSIONER McKENDRY: Thank you,
9 Madam Chair.
10 3717 THE CHAIRPERSON: Commissioner
11 Cardozo.
12 3718 COMMISSIONER CARDOZO: Thanks, Madam
13 Chair.
14 3719 I have a couple of questions that I
15 am just trying to sum up in my mind, the core of your
16 message. If you move -- focus on to the issue of
17 audience and viewers, do you want at some point -- and
18 you talk about the ultimate goal being doing away with
19 regulation I think when you were part of the CAB
20 presentation. Do you see a time coming up fairly soon
21 where there would not need to be regulation dealing
22 with the content issues? That the issue of quality --
23 and I guess this is part of what has been the concern
24 of some of the other people who disagreed with your
25 model, that we wouldn't be interested in not just
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1 Canadian, but also the quality of the programming, but
2 only on the issue of audience and number of viewers?
3 3720 MR. MACDONALD: I think that whenever
4 you try to put together a proposal you have to look for
5 anybody, but particularly the regulator, you have to
6 put yourself in the shoes of the regulator and say, "If
7 this guy came before me and said trust me, is that
8 really going to fly?"
9 3721 I think that what we have tried to do
10 is come before you with an idea that we think can fly
11 and we have asked you not to move away from any of your
12 normal tools. I think that the only time that we can
13 legitimately come before you and say, "Now we would
14 like to move to the next step of deregulation," is when
15 we have proven to you that we can do the first part.
16 3722 So, again, we are asking you to move
17 into looking at this from a qualitative point of view,
18 recognizing that quality is so damn difficult to try to
19 measure. But it does translate, we hope, into quantity
20 of audience.
21 3723 So, we are suggesting that all the
22 measurement tools are still there and would continue to
23 be there, but that the leadership from the Commission
24 moves us towards a different currency that says viewers
25 are important. Viewers are really an important part of
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1 this, so we are going to control and make sure that the
2 system moves forward with our traditional tools, but we
3 are going to adopt the viewership concept. We are
4 going to embrace the broadcasters' commitment to
5 develop a viewership plan, a business plan for all of
6 Canada to bring viewership as an important component.
7 3724 Everybody that has been here -- this
8 is one of the exciting things is that people have maybe
9 misinterpreted or misunderstood or whatever. That will
10 be solved by the end of this hearing, but nobody has
11 said that generating more viewership to Canadian
12 programming is a bad idea. In fact, everybody said it
13 is a good idea.
14 3725 So, from our perspective we say we
15 are not asking the regulator to move off the
16 regulator's tool bag, but we are asking you to adopt a
17 different strategy.
18 1550
19 3726 COMMISSIONER CARDOZO: But I'm not
20 clear then as to why you say this is qualitative when
21 in fact you are really talking about quantity of
22 viewers and your view is that the Commission has
23 focused on quantity of programming. The issue I don't
24 hear you talking about is the quality of the
25 programming.
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1 3727 MR. MacDONALD: The quality -- I am
2 making the assumption, and maybe this is wrong, that
3 quality attracts viewers. So, if I look at hours, it's
4 a very quantitative measurement. If I look at dollars,
5 it's a very quantitative measurement. If I get into
6 quality or, as the Act calls it, standard, it's very
7 difficult because we all have different standards and
8 what is a popular program is not necessarily a quality
9 program, and we can get into those semantics.
10 3728 But, in general, we are working on
11 the assumption that if we can build quality into the
12 system, we can build audience into the system and the
13 way that we can ultimately bring this nebulous issue of
14 quality to bear in such a way that it can be measured
15 is by turning what we are trying to do into more
16 audience.
17 3729 COMMISSIONER CARDOZO: I guess my
18 reading of the situation is that -- and I give the
19 credit to people who have been here before me, but my
20 sense is that we moved from tonnage, if you can call it
21 that, to quality over the last number of years as we
22 added on requirements around prime time and around
23 expenditure for the precise purpose that it would
24 result in viewers. So, it seems like the Commission
25 have the idea already in those two things.
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1 3730 MR. MacDONALD: Well, I don't
2 disagree that that was the objective, but thus far as a
3 system we haven't been able to generate the additional
4 audience. I think we are close, but I think that's why
5 we feel that if the Commission adopts it, we can bring
6 all the pieces together, because we are that close.
7 3731 COMMISSIONER CARDOZO: I will just
8 read one sentence here from your presentation today.
9 3732 "...the 'do more' proposals you
10 have heard are simply not
11 consistent with the economic
12 viability of the engine that
13 pulls the system."
14 3733 So, I just want to understand the
15 core of your presentation, which is that more
16 flexibility will get us better quality, more
17 competition and then more viewers and that you
18 definitely do not want to see any higher levels or any
19 more specificity in how those levels should be
20 implemented.
21 3734 MR. MacDONALD: If you could write it
22 up just like that, I would be very happy.
23 3735 COMMISSIONER CARDOZO: I got it then.
24 Thanks.
25 3736 THE CHAIRPERSON: I have two
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1 questions. The first is I don't know if all of you
2 were here when Mr. Morrison was here this morning, but
3 I heard you say, Mr. MacDonald, that complementarity is
4 brought on by competition and what he exposed to us was
5 by using the schedules of the broadcasters that exist
6 or that transmit in Ottawa, competition had actually
7 worked against complementarity in that local and
8 regional programming was disappearing because stations
9 had to compete doing the same thing if they were going
10 to survive.
11 3737 I understood you to say competition
12 would have the opposite effect. So, why is it that
13 with the introduction of CHUM, CFMT and your Hamilton
14 station into Ottawa, it would appear that local and
15 regional programming is disappearing and that the
16 schedules are presumably looking more and more the same
17 because, so their research says, people have to compete
18 with the additional stations that are now available in
19 that market?
20 3738 MR. MacDONALD: Madam Chair, it's a
21 very good question. I don't have the charts and I
22 haven't studied them specifically, so I am probably not
23 capable of answering your question. I would have
24 thought that CJOH, as an example, has a wonderful news
25 reputation in this market. They also have, of course,
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1 the ability to sell locally.
2 3739 When we did a lot of research about
3 coming into Ottawa, one of the things that we found was
4 dramatically underserved was the local market in terms
5 of local programming. So, I can't understand why the
6 station wouldn't move forward against that core
7 competency, because it is a niche that clearly is
8 underserved and Ottawa is a major market for news.
9 3740 But generally it has been our
10 experience that people don't all clamour to do exactly
11 the same thing in the spirit of competition. They tend
12 to go off and develop different kinds of projects with
13 different kinds of companies. So, they are developing
14 a uniqueness to the market.
15 3741 The fact that we have all been asked
16 to focus on 7, 8 and 9 does narrow the gap somewhat and
17 I do believe that if you in fact expand the categories
18 somewhat that will help dramatically, but I can't
19 answer your specific question about information
20 programming because that would seem to fly --
21 3742 THE CHAIRPERSON: I said local and
22 regional. So, it doesn't necessarily mean not news,
23 local and regional programming. Perhaps we can ask
24 Baton whether they agree with the chart that shows a
25 decrease in serving the local regional market and
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1 whether they feel that it's as a result of having
2 competition in a market, albeit not necessarily local
3 because neither you nor CHUM do local, but his thesis
4 was that the reason why it is disappearing is because
5 we made the wrong decision in allowing competing
6 services who now feel they all have to compete with
7 each other in the same areas and there is no money left
8 for the local regional.
9 3743 But it's perhaps not fair to ask you.
10 I just wanted your comments on the principle, which is
11 completely at odds with his. He seems to be able to
12 demonstrate a result that would support his.
13 3744 MR. BUCHANAN: We will follow that
14 discussion with interest. It would also be interesting
15 to know whether those stations were on hours or dollars
16 and whether they channelled their dollars and hours
17 into 7:00, 8:00 and 9:00 in the evening and so on and
18 out of the local and regional as a result of what
19 happened in the last round of licensing. So, we will
20 follow that.
21 3745 THE CHAIRPERSON: Of course, Mr.
22 Buchanan, you live in Ottawa, so you should be most
23 interested in seeing "On The Road Again" and clogs and
24 so on.
25 3746 On a more jurisprudential basis now,
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1 in the Preface to our Public Notice the first paragraph
2 was:
3 3747 "The attached public notice sets
4 out the issues and concerns the
5 Commission wishes to discuss as
6 part of a broad and fundamental
7 review of its policies relating
8 to television..."
9 3748 And at paragraph (iv) of the same
10 Preface to the Public Notice announcing this hearing,
11 the Commission says that its:
12 3749 "...goals for this review of its
13 regulatory and policy framework
14 for television are
15 straightforward - further the
16 development of a strong and
17 viable programming industry..."
18 3750 And later on in the Preface, at
19 paragraph (xii), the third last bullet, the Commission
20 asks as one question:
21 3751 "What framework is necessary to
22 allow for different, but
23 equitable contributions by all
24 broadcasters?"
25 3752 The second last bullet:
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1 3753 "What framework would best
2 encourage the production,
3 acquisition and exhibition of
4 commercially viable Canadian
5 programs?"
6 3754 You have participated in the hearing
7 and you have appeared today, but you felt it necessary
8 at paragraph 4 of your Executive Summary to say that:
9 3755 "The regulatory bargain is
10 therefore complete..."
11 3756 And:
12 3757 "...absent perhaps moving to a
13 group licensing regime for
14 administrative efficiency, the
15 regulatory status quo should be
16 preserved. This is not only an
17 issue of regulatory fairness."
18 3758 Not only that:
19 3759 "We are at precisely the wrong
20 time to make fundamental changes
21 on the regulatory front given
22 the uncertainties outlined in
23 this submission."
24 3760 Now, let's leave aside the
25 uncertainties that you have outlined. Are you
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1 suggesting that the Commission is having this review
2 and it can't do anything at the end of it because you
3 have a bargain for seven years and it would be
4 regulatory unfairness if anything were to be changed?
5 3761 MR. MacDONALD: I will speak to the
6 first part of that question and then throw it to my
7 lawyer. First of all, it's very clear that,
8 notwithstanding the fact that we have seven-year
9 licences, the Commission can call us back to have a
10 little discussion, a fireside chat, as the case may be,
11 at five years. It's also very clear that the
12 Commission can change the television regs whenever it
13 wants to. So, I would say that you can pretty much do
14 what you want.
15 3762 THE CHAIRPERSON: Except that we be
16 unfair.
17 3763 MR. MacDONALD: Well, I was getting
18 to that part.
19 3764 I think that we have in fact put
20 together a business plan that we shared certainly with
21 our board and others and it's predicated on certain
22 assumptions. We think that there is no question that
23 the Commission can make changes, but we think that we
24 entered into the renewal process in the spirit of that
25 process and that length of time and we think that major
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1 changes to it certainly prior to the end of five years
2 would be unfair.
3 3765 But, Grant, you have some comments, I
4 am sure.
5 3766 THE CHAIRPERSON: Let me ask you
6 first whether this is the principle WIC would like to
7 be applied with regard to any application it brings to
8 the Commission during its seven-year licence term?
9 3767 MR. MacDONALD: Touché.
10 3768 MR. BUCHANAN: You don't need a
11 lawyer. I have nothing to add. You are absolutely
12 right, the point is made in the Broadcasting Act and in
13 the regs. You are perfectly welcome to bring us back
14 to have our chat, but it was interesting, Commissioner
15 Cardozo's question, about the future of the Commission
16 and so on. I think we will hear lots more in the new
17 media hearing from a lot more people who haven't been
18 in front of you before, who have different views about
19 your future. We have been sitting noodling about our
20 own and not just WIC as the industry.
21 3769 You mentioned at the beginning of
22 this hearing we are 50 years into it and don't all of
23 us wish we could look forward and wonder how many more
24 years we have in the same kind of point to multi-point
25 distribution kind of mode or whether we are undergoing
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1 significant changes to our landscape that we need to
2 deal with in both these hearings. So, it wasn't just a
3 regulatory fairness thing. So many of these things
4 that we highlighted are going on and for the first time
5 they are all happening together at the same time. So,
6 we are just looking all over the place to find answers
7 to these things, as we know you are.
8 3770 But that's what made it -- we have
9 entered into these production commitments. We think we
10 have the stations that are 7, 8 and 9. There are
11 germination periods, as you well know, for these big
12 projects. They are going to satisfy those. We didn't
13 want radical shifts right now and, to be honest, when
14 we finally got the Crop Study the other day, they
15 didn't seem to be pushing for a whole lot of radical
16 change, either, the people at least that were asked
17 when the Commission went out to find what Canadians
18 wanted.
19 3771 THE CHAIRPERSON: Thank you very
20 much, gentlemen, and have a nice weekend.
21 3772 Oh, legal counsel.
22 3773 MR. BLAIS: Just three points which I
23 think I need to clarify. The first on is on page 24,
24 more particularly at paragraph 83 of your submissions.
25 You say there:
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1 3774 "We certainly believe that the
2 Commission should make every
3 effort to ensure that each
4 broadcaster is making a
5 contribution which is fair and
6 equitable so that no one company
7 is left with a regulatory
8 spending advantage over
9 another."
10 3775 Can you expand on this? How do you
11 suggest this be accomplished?
12 3776 MR. MacDONALD: We think that -- I
13 mean equity is an interesting concept and it can come n
14 many shapes and sizes, but I used one illustration of
15 that in our presentation where I said in a situation
16 where two companies were doing an equal number of same
17 genre hours, the amortization base of revenue would
18 make it significantly different between a smaller group
19 and a larger group. I just wanted to make sure that
20 those kinds of factors were taken into consideration
21 when the equitable contribution that was made by each
22 of the companies was looked at.
23 3777 MR. BLAIS: But you don't have a
24 specific more than that generally it should be
25 equitable and fair? You don't have a specific way for
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1 us to do that?
2 3778 MR. MacDONALD: No, we are not
3 advocating a particular percentage of this or a
4 percentage of that or anything else. We just wanted to
5 make sure that we demonstrated that there was certain
6 potential for inequity given certain circumstances and
7 that was one example.
8 3779 MR. BLAIS: There is another point --
9 maybe it's after lunch and I couldn't follow the
10 discussion, but we had discussions about this audience
11 potential between 7:00 and 8:00 p.m. and you were
12 saying that there was potentially interesting audiences
13 in that time frame and that it could be a place for
14 Canadian programming to get audiences. But it would
15 seem that, despite that potential, you are still
16 putting mainly U.S. programming in that time slot and I
17 want to make sure, have we put a regulatory burden --
18 not a burden, but an obstacle in your way from
19 exploring those options?
20 3780 MR. MacDONALD: Not for WIC, you have
21 not.
22 3781 MR. BLAIS: So, it would make good
23 business sense for you to explore that right now to put
24 Canadian programming between 7:00 and 8:00?
25 3782 MR. MacDONALD: Yes, and we are.
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1 3783 MR. BLAIS: Yet there is a suggestion
2 that we should go even further and hold your hand to
3 get you to do that in your submissions.
4 3784 MR. MacDONALD: No. There are some
5 licensees that have core prime commitments and we were
6 really speaking in support of expanding the notion of
7 core prime from 8:00 to 11:00 to 7:00 to 11:00, that's
8 it. But to be specific, there are no particular
9 regulations that affect WIC. Most of our stations are
10 on hours. It's very clear when those hours have to run
11 and that's it.
12 3785 MR. BLAIS: My last question comes to
13 your oral submission on page 4. Commissioner
14 Pennefather quoted from your submission there in the
15 middle of the page, where you stated:
16 3786 "In summary, while WIC intends
17 to schedule primarily Canadian
18 drama in prime time, we do not
19 feel that broadcasters should be
20 required --"
21 3787 Underscoring "required":
22 3788 "-- to have their scheduling
23 options so constrained.
24 Competitive forces will ensure
25 diversity."
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1 3789 Then you go on and you say:
2 3790 "Indeed, we believe that this
3 approach is consistent with the
4 section --"
5 3791 In the singular:
6 3792 "-- of the Broadcasting Act
7 relating directly to the
8 obligations of programming
9 undertakings..."
10 3793 I was wondering if you could tell me
11 which is that one section of the Broadcasting Act which
12 relates directly to the obligations of programming
13 undertakings as opposed to any other section of the
14 Broadcasting Act.
15 3794 MR. BUCHANAN: 3(1)(s).
16 3795 MR. BLAIS: So, are you suggesting
17 then that if 3(1)(s) is the only section that deals
18 directly with the obligations of programming
19 undertakings, when we look at 3(1)(e), 3(1)(f) --
20 3796 MR. BUCHANAN: Before we go through
21 the litany, that section refers specifically to what we
22 were talking about here. There is all kinds of
23 sections that govern programming undertakings. You
24 don't have to go through and find them all.
25 3797 MR. BLAIS: So, you would agree with
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1 me then that when the Commission, in the exercise of
2 its jurisdiction, looks to the obligations that each
3 element of the system and each broadcaster must
4 contribute in an appropriate way to some of the
5 objectives, we can look to other sections to reach that
6 goal?
7 3798 MR. BUCHANAN: You certainly may. I
8 guess the point to be made here is this section has a
9 preamble to it that says what programming undertakings
10 should do is, to an extent consistent with the
11 financial and other resources available to them, do X,
12 Y, Z. Our concern was that in the discussions so far
13 this week, that part has been overlooked.
14 3799 There have been lots of suggestions
15 about a percentage of this and the percentage of that
16 and another percentage of this. Let's read that and
17 make sure that that is factored into the discussion
18 when we consider the proposals put forward by other
19 parties is consistent with the financial abilities of
20 the licensees who are being asked to do them. But your
21 point is well taken. There are lots of other sections
22 of the Act that refer to broadcasters.
23 3800 MR. BLAIS: I will certainly read
24 subparagraph (s) if you will also read subparagraph
25 (f), which talks about, "each broadcasting undertaking
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1 shall make maximum use and no less than predominant use
2 of Canadian, creative and other resources." So, we
3 will read all of section 3 together then.
4 3801 Thank you.
5 3802 THE CHAIRPERSON: I say au revoir.
6 3803 We will take a 15-minute break and be
7 back for those who are appearing later on.
8 --- Short recess at / Courte pause à 1610
9 --- Upon resuming at / Reprise à 1625
10 3804 THE CHAIRPERSON: Good afternoon
11 again.
12 3805 Madam Secretary, would you call the
13 next participant, please.
14 3806 MS BÉNARD: Thank you, Madam Chair.
15 3807 The next presentation is by Mr. Chris
16 Stark.
17 3808 THE CHAIRPERSON: Good afternoon,
18 Mr. Stark. You can start when you are ready.
19 PRESENTATION / PRÉSENTATION
20 3809 MR. STARK: Good afternoon,
21 Commissioners. Thank you kindly for this opportunity
22 to spend 10 minutes or so with you talking about our
23 perspective as people who are blind who use the
24 television system. We are not viewers but we are the
25 audience as well.
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1 3810 I think that it is important at the
2 beginning to acknowledge the assistance of the
3 Commission staff in helping some of us blind people who
4 have taken an interest in some of your processes,
5 helping us to understand those processes and to have
6 some access to them.
7 3811 As I will mention later on, we find
8 that the Commission's processes are somewhat difficult
9 to access, and I as an individual would say I have
10 about as much access to it as what you see of an
11 iceberg above the water. But I did want to, before
12 going into all of that, acknowledge that the staff have
13 been very courteous in making sure that we get on this
14 dance card and I get into this dance hall and have a
15 chance to share a few words with you because I, like
16 many persons with disabilities in general and blind
17 persons in particular, see some good melodies in terms
18 of decisions and signals from the CRTC that we have the
19 right to full and complete access to the television
20 system, whether we access it through vision or hearing
21 or both.
22 3812 I think that the other point that I
23 would openly make in the beginning is that we have had
24 experiences with the CRTC that show us that the
25 television industry is not an island unto itself, there
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1 is more integration and more linkages between the
2 various services and systems you regulate and there is
3 a great deal of interdependency and more and more
4 interaction.
5 3813 I think it is worth looking for a
6 second at how we became involved in this, my wife and I
7 and others. We heard through the grapevine that Bell
8 Canada was going to ask the CRTC to allow it to charge
9 blind people for getting telephone numbers while at the
10 same time not agreeing to provide us with telephone
11 books we can read. Fortunately, the Commission allowed
12 the service of directory assistance for free to blind
13 people to continue. So it is not all a bleak picture.
14 We have to acknowledge some of the moves that the
15 Commission has made, and they have been helpful.
16 3814 Heaped on the top of that was a thing
17 called "negative billing". The first I knew about it
18 was when my automatic deduction for cable service
19 through the bank resulted in an increase in my monthly
20 expenses without a great deal of warning or information
21 or knowing that I had to call in and say I didn't want
22 it. Fortunately, the Commission as well there has
23 upheld our right to know what we are paying for. For
24 those things, we must offer you significant
25 appreciation.
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1 3815 However, in this case of looking at
2 television there is a great deal more that we need.
3 You have our brief before you. It is one that says,
4 "Us too, please". It talks about integration and talks
5 about blind people as customers.
6 3816 If you realize that blind people --
7 when we use the systems, we are also encouraged to use
8 the supporting system. I notice WIC mentioned their
9 websites, and websites are one particular area that
10 blind people have had some difficulty in using
11 connected to television services. The CBC's website
12 has been particularly difficult for people who use
13 speech-readers to access. My wife is in fact a
14 Formula 1 fan and follows the career of Mr. Villeneuve
15 quite closely, and every race we are told to go to the
16 TSN website and see what Gerry Donaldson has to say in
17 extra information, but it is almost totally impossible
18 for us to access that.
19 3817 Then we move on to the idea of using
20 1-800 numbers to call in, for programs to call in for
21 comments or in fact for advertising that I guess the
22 next presenter will talk about, advertising using 1-800
23 numbers that say, "Call 1-800" and then a name. Well,
24 it is difficult for blind people to do that.
25 3818 Those interactive things that affect
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1 the quality of our use as an audience of the television
2 medium are things which I think we can't overlook.
3 3819 Moving on from that to the issue of
4 exactly what programming is available and whether we
5 can use it, most of the stuff I guess that we are
6 recommending, we believe to be low cost/no cost; we are
7 some of the "do mores", and I don't apologize for that,
8 but I don't come with a blank cheque and an expectation
9 of huge expenditures by industry. I think the fears in
10 terms of access for blind people are based more on lack
11 of knowledge and understanding. After all, I pay cable
12 bills and I pay eventually for the products that have
13 been advertised on the television as consumer; so I
14 don't want my bills to go up any more than anybody
15 else's.
16 3820 So my point is that, in my reality
17 check, the reality is that people with disabilities
18 have some degree of difficulty getting the full benefit
19 of television service in Canada. It could be from
20 solutions as simple as announcing 1-800 numbers once
21 with their voice with the word extension and then once
22 with the number extension. It could be as simple as
23 announcing some of the temperatures and some of the
24 sports scores and some of the other visual information
25 that is presented on the screen without comparable
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1 audio access.
2 3821 If you think that this is not a
3 serious problem, let me tell you that during the ice
4 storm we lived through this winter, for a substantial
5 amount of time until the local radio stations began 24-
6 hour coverage, it was difficult to get weather forecast
7 and temperatures for Ottawa that we could understand
8 because The Weather Network was simply giving the
9 general global picture and then scrolling all this
10 information and inviting us to read it. I am afraid I
11 can't read it and I don't think that I should have to
12 read it visually only.
13 3822 That's part of why I am here to ask
14 for your help, understanding and support in a more pro-
15 active way than the Commission has been able to offer
16 in the past.
17 3823 We look on to the whole area of
18 programming in terms of knowing what's on the systems.
19 If I am in Vancouver or if I am in Halifax, the channel
20 for Newsworld is not the same always in every
21 community. So it is difficult to find a channel. We
22 don't have access to nine or ten different program
23 sources like a television guide in the newspaper or the
24 channel on the television cable system that broadcasts
25 advertisements and shows the program listings. Those
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1 things can be resolved in a way which doesn't cause
2 industry commercial calamity. They can be resolved
3 through planning, through thoughtfulness and through
4 concern for all customers, not just viewers, but for
5 the entire audience.
6 3824 What I am suggesting as well here is
7 things like an awareness and a consciousness that
8 people with disabilities want our place in the
9 boardrooms and on the screens and behind the cameras
10 and in the production teams. So there is the equity,
11 as I keep hearing -- and it amazes me how many people
12 now use "diversity" and "equity" to mean a lot of
13 different things beside "inclusion". I think that what
14 we are asking is to be included in the economic, social
15 and other benefits of the television system.
16 3825 As one of my friends, Mr. Ray
17 Barfoot, wanted me to be sure to tell you today -- he
18 says that he really appreciates being able to get
19 Braille channel line-ups from Rogers Cable, but he
20 really feels quite degraded and discouraged when every
21 time there is a channel line-up change of the service
22 they don't send it to him in advance, he has to call up
23 and ask for it over and over and over; and he doesn't
24 feel, and I don't feel, that that's customer service.
25 Sighted people get it in the mail, they don't ask for
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1 it. They are told when the changes are coming, and we
2 don't have to discover it by accident and go back.
3 3826 I am nearly through these anecdotal
4 remarks that I wanted to make to you in support of our
5 brief and rely on your questioning of me if there is
6 anything that is unclear, because I think that what I
7 wanted to do and my wife wanted to do and our friends
8 wanted to do was to give you some experiential
9 information and anecdotal information about what it is
10 like to pay for services that we don't get the full
11 benefit of for no fault of our own.
12 3827 I heard a lot about business plans as
13 I have sat here this afternoon and basic assumptions
14 that shouldn't change. From our perspective there
15 seems to be some basic assumptions that it is quite
16 adequate to compete for the market without regard for
17 all of the market, without regard for all of Canadians.
18 3828 This is best expressed I think by
19 some material I read for the Royal National Institute
20 for the Blind in England, which you could probably
21 obtain as well from their website, which talks about
22 the increased predominance of allowing more freedom in
23 the marketplace and encouraging competition and concern
24 for economic viability, which has been used,
25 incorrectly in their view and my view, to justify not
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1 providing equitable service for all users of a service,
2 whether it be telephone or television.
3 3829 I was particularly disturbed -- and I
4 have expressed it to the Canadian Cable Television
5 Association, to see in their initial brief not a
6 mention of people with disabilities and our concerns.
7 You will recall that they were involved with the
8 Commission in several of the matters we brought to your
9 attention for review.
10 3830 So my point is that without your
11 involvement and without your support and without your
12 public demonstration of a commitment to us, I don't
13 think the situation will improve. I cited one
14 particular example, and that example was of a group of
15 Canadian veterans who had written you, the Sir Arthur
16 Pearson Association of War Blinded Canadians, and asked
17 the very same question a year ago about -- "Please help
18 us get access to sports scores, stock market prices and
19 the like", and the reply was, "Well, intervene licence
20 by licence."
21 3831 These people have given their vision
22 for this country; they don't need another war to go up
23 against well-heeled commercial undertakings for what
24 you take as your everyday service. These people and I
25 and all other Canadians who are blind want equal access
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1 to information.
2 3832 This lack of information and lack of
3 ability to access this information is one of the main
4 reasons why there is an 80 per cent unemployment rate
5 among blind people, and it is not going to change
6 unless public institutions realize that they have the
7 legislative mandate -- and you have had, in my view,
8 for considerable time the legislative mandate -- to
9 help us have full access and full participation.
10 3833 Websites is a good example of a brand
11 new technology that's installed with barriers against
12 people who are blind. It is not an expensive retrofit,
13 it is failure to consider us as customers; it is
14 failure to include us in the business plan.
15 3834 So don't do it because somebody
16 wanders in off the street and asks you to do it or I
17 sit here and demand it or you think blind people are
18 objects of charity or you believe that we need special
19 services. Do it because it is the human thing, do it
20 because it is the right thing, do it because it is your
21 legislative mandate. Please give us full access.
22 3835 Thank you, and I will entertain
23 questions.
24 3836 THE CHAIRPERSON: Thank you,
25 Mr. Stark.
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1 3837 Let me introduce myself and my
2 colleagues to you before we ask questions.
3 3838 MR. STARK: Thank you.
4 3839 THE CHAIRPERSON: There are five of
5 us here. I am Andrée Wylie and I am presiding. There
6 is also Commissioner Joan Pennefather, Commissioner
7 Andrew Cardozo, Commissioner David McKendry and
8 Commissioner Martha Wilson. Ms Wilson will ask you
9 questions, and we may as well.
10 3840 MR. STARK: Thank you. Fine.
11 3841 COMMISSIONER WILSON: Thank you very
12 much, Mr. Stark. I appreciate the efforts that you
13 have taken to be here with us today, and thank you for
14 waiting. I am the person at fault for your waiting so
15 long because I was the one who was going on and on with
16 the previous interveners.
17 3842 You made the point in your submission
18 that as a blind person it is much more effective
19 presenting your views orally, and you indeed are very
20 eloquent, but I did find your submission both clear and
21 informative and I did want to compliment you on that.
22 3843 At the beginning of the submission
23 you make a number of recommendations about how the CRTC
24 itself could become more proactive in ensuring that
25 persons with disabilities in general, and blind persons
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1 in particular, receive the same level of access as all
2 other Canadians to both our public processes like this
3 one here today and to television, which is what this
4 hearing is all about.
5 3844 You also make a number of
6 recommendations with respect to the Canadian
7 broadcasting system covering everything from the
8 representation of persons with disabilities on
9 television and how you are, or are not in most cases,
10 able to access new media like the Internet as well as
11 with respect to employment opportunities in the
12 industry.
13 3845 What I really want to explore with
14 you this afternoon -- and my colleagues may have
15 questions on other areas -- is the whole issue of how
16 television can better serve your needs, particularly
17 the issue of descriptive video. I have only been at
18 the Commission for four and a half months and I am
19 certainly not an expert of any kind in this area, so I
20 appreciate the opportunity to share with you whatever
21 knowledge or experience you might have in terms of
22 helping me and some of my other colleagues to
23 understand this.
24 3846 I wonder if you could tell me -- I
25 just want to ask you a few questions about this -- how
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1 much descriptive video is currently available in
2 Canada, or are you aware of how much is available?
3 3847 MR. STARK: I think that the National
4 Broadcast Reading Service would probably be the better
5 ones to tell you the exact quantity. What I can tell
6 you is that there is very rarely descriptive video
7 available. I know that the Commission, in its letter
8 to the Sir Arthur Pearson Association, mentioned some
9 measures that were undertaken. It is my understanding
10 that that has resulted in very little descriptive
11 video.
12 3848 I don't have access to it on a
13 regular basis, not because I wouldn't use it, but
14 because I don't know where it is, when it is. I know
15 there have been some programs like the
16 "Ira Arrow" (ph.) program on the CBC that have been put
17 on as tests, but what I am talking about is more not
18 tests but part of the common garden everyday fare that
19 every station in the country might make some
20 descriptive video available.
21 3849 It doesn't always have to be the
22 special production; it can be a simple, as I told you,
23 of saying telephone numbers, of giving sports scores
24 and working it into the regular programming.
25 3850 Two quick examples, if I might.
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1 3851 If you think of the origin of the
2 term "colour commentator", it was at a time when radio
3 stations were the primary coverer of events, and people
4 like Max Ferguson would have their colour commentators
5 to tell you about what the crowd was doing, what the
6 weather was like and all of these things which sighted
7 people needed and wanted, and so did blind people, to
8 understand the radio broadcast because sighted people
9 didn't have a television screen to convey that, so we
10 had colour commentators.
11 3852 Now the situation is reversed, and I
12 don't understand, personally, as an individual, why it
13 is such an uproar now and such a problem for the
14 industry to provide descriptive video for blind people
15 when the radio industry did it for decades for sighted
16 people because they were part of the audience -- and we
17 are part of the audience. That's the first point that
18 I would make to you.
19 3853 The second point that I would make to
20 you is that we rose this issue, some of us, with the
21 CBC and CBC Newsworld on several occasions. We were
22 told that, you know, we couldn't take the time to read
23 sports scores or temperatures or some of the stuff that
24 scrolled across the screen because it takes too long.
25 So we said, "Well, yes, but you are playing music."
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1 They said, "Oh, the audience needs that music in order
2 to have the right ambience to watch Newsworld." I am
3 afraid I don't know anybody and nobody has ever come
4 forward to me and said, "I watch Newsworld for the
5 music." "I watch The Weather Channel for the music."
6 I don't think so. So that's my point.
7 3854 There is time. There is a lot of
8 descriptive video that can be done in existing program,
9 and then there is probably the descriptive video that
10 you are referring to, and that is where a whole program
11 is described. And it is helpful and it is beneficial,
12 particularly to totally blind persons and partially
13 sighted persons, who miss a lot of the action and rely
14 on sound.
15 3855 So the short answer to your question
16 is, descriptive video is not a reality in my TV
17 experience at the moment.
18 3856 COMMISSIONER WILSON: I am glad that
19 you made the distinction for me between descriptive
20 video as it pertains to full productions and
21 descriptive video as it pertains to weather or news or
22 really what most people would consider the most basic
23 of information and really critical to their lives every
24 day.
25 3857 Just by way of an anecdote of my own,
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1 I used to run a channel that people watched for the
2 music; it was at that time known as the Parliamentary
3 Channel. It wasn't on the air very much, so they did
4 play music all the time. We actually got into a lot
5 of -- well, we got a lot of complaints when we took the
6 music off.
7 1645
8 3858 But that was my line. You don't
9 watch this channel to listen to music. It's a TV
10 channel. It's not radio.
11 3859 I am aware that the National
12 Broadcast Rating Service is engaged in discussions with
13 broadcasters on the whole issue of described video. Do
14 you ever participate in any of those discussions?
15 3860 MR. STARK: No. I haven't been asked
16 to. We did participate in some discussions with the
17 cable companies with respect to getting some of the
18 access to some of their services line channel lineups
19 and so forth.
20 3861 In general the feeling, and I do know
21 some about it because there is some information shared.
22 Thanks to the Internet, there's lots of lists now where
23 blind people from Victoria and Halifax can chat
24 together when we want to. There is some programming
25 over that service as well.
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1 3862 It's my understanding, and this is my
2 only third party off the central track understanding,
3 that it is really a perception that the industry feels
4 that it's too much of a financial burden, probably akin
5 to the arguments that are used about closed captioning.
6 3863 Frankly, to give Bell Canada a kudo
7 here, when they talked about the Bell Radio Relay
8 Service and its expense, they added 13 cents to
9 everybody's bill and paid for it. I have no problem
10 with sharing that cost across the whole system. I
11 think it's a societal cost to that extent and it may
12 very well be very expensive in some respects, but WGBH
13 in Boston has produced a lot of movies with descriptive
14 video available on them and with the SAP service on
15 channels, you can provide that without disturbing the
16 ambience for people who don't want it.
17 3864 I think that when you come to digital
18 television, which I also heard and I did enjoy the
19 presentation this afternoon because it gave me more to
20 talk about, not that I don't have enough to talk about
21 as it is, but it gave me more to talk about.
22 3865 The issue is with digital television
23 you are going to be, as I understand it and from
24 presentations I heard in Los Angeles this spring, you
25 are going to be able to broadcast a movie with an
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1 English language track and a French language sound
2 track and half a dozen other language sound tracks.
3 3866 The potential for diversity of
4 mediums with digital programming and digital CDs, and
5 you know better than I do whether the whole potential
6 for that diversity will come across the cable or
7 television or both, but certainly with a little bit of
8 room for descriptive video that I can use and closed
9 captioning that the deaf can use and not interfering
10 with the enjoyment of those who don't need it is quite
11 within our technology today at costs which are
12 insignificant when you talk about $10 million profits.
13 3867 COMMISSIONER WILSON: Actually, I am
14 glad that you raised the issue of costs because the CAB
15 in its comments on Wednesday indicated that the cost of
16 producing described videos between 500 and 1,000 times
17 as expensive as closed captioning. Do you have any
18 information to confirm that or disabuse us of that
19 notion?
20 3868 MR. STARK: I guess I have to go back
21 to a basic point. I don't have any facts and figures
22 because really I am here as a consumer who wants
23 access. If you ask me, I don't care about the cost. I
24 want the access. I pay for the products, as I said
25 before.
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1 3869 In trying to respond faithfully to
2 your question, I think that the first thing you have to
3 think about is that approximately 20 per cent of the
4 Canadian audience is disabled in one form or another.
5 It's not the disability that causes the problem, it's
6 the handicapping effects of the system.
7 3870 COMMISSIONER WILSON: Are visually
8 disabled?
9 3871 MR. STARK: No. They may be
10 cognitively disabled, they may have hearing
11 disabilities.
12 3872 COMMISSIONER WILSON: Okay.
13 3873 MR. STARK: They may have visual
14 disabilities. The point is that that whole market is
15 at least 18 to 20 per cent of the audience the
16 advertisers are trying to reach, the audience that the
17 television broadcaster wants. Finding ways to meet
18 those needs are important. I don't think they are cost
19 prohibitive when you look at it in that type of scale.
20 3874 When you look at it in the scale of
21 everybody having to do it, costs will come down. Just
22 remember what it cost years ago to provide some of the
23 things that are cheap today.
24 3875 The other thing people sometimes say
25 is well, you know, who would really use it? Well, I
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1 think a lot of people other than blind people from time
2 to time might use descriptive video. I have to give
3 you two examples if I might. I am purposely dodging
4 your question because I'm not an economist.
5 3876 COMMISSIONER WILSON: That's okay.
6 3877 MR. STARK: From my perspective, it's
7 not the cost issue. If you tell them they have to do
8 it, they will make sure it doesn't cost five times as
9 much. They will make sure it costs the same as
10 anything else.
11 3878 I made once a suggestion to Rogers,
12 and I am reluctant to make suggestion because when you
13 make suggestions, everybody says they are wrong. I use
14 on my machines, and I have one right here, I use voice.
15 --- Demonstration / Démonstration
16 3879 Now, you probably understood most of
17 that without even any training in using voice. Some of
18 this material could be used with synthetic voice. The
19 action back was "Well, the broadcast quality wouldn't
20 be sufficient".
21 3880 I make my living through my ears.
22 It's good enough to earn a living and pay taxes. My
23 point is that while you look at descriptive video as
24 costing much more, the other question I would ask you
25 is what do they say about producing material in both
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1 official languages? What's the difference between
2 descriptive video and two or three Inuktituk or
3 whatever the Arctic language you may have to use in the
4 north or what is the difference meeting that need and a
5 language need or meeting that need a descriptive and a
6 closed captioning need.
7 3881 The cost is so great because it isn't
8 in widespread use. I would suggest the Commission ask
9 people like the public broadcasters in the States that
10 produce some descriptive video. Find out from them. I
11 can't answer that question, but from my point of view
12 it's not really as an important question.
13 3882 If it costs so much, do one or two.
14 Start gradually. Work it into the system. I can say
15 to you now that it isn't and it isn't a part of my
16 life.
17 3883 COMMISSIONER WILSON: Is there any
18 programming at all in Canada that has described video?
19 3884 MR. STARK: There are movies we can
20 borrow and there are movies we can buy with descriptive
21 video. There probably are. I think there are some
22 movies on the family channel, but it's not the kind of
23 thing I watch. I'm not really your expert on that
24 whole area.
25 3885 From time to time, as I mentioned,
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1 there is a special on the CBC, but on a day to day
2 basis there are very few, and I am not aware of any
3 programs that I could go home tonight and watch
4 descriptive video on. I'm not aware of most of the
5 programs that are on television tonight. I surf.
6 That's the only way I find out what's on.
7 3886 COMMISSIONER WILSON: I just wanted
8 to comment on something you said. You are not an
9 economist and you can't really answer my question. You
10 are just a consumer, but "just a consumer" is a pretty
11 important person to be.
12 3887 MR. STARK: Thank you.
13 3888 COMMISSIONER WILSON: In fact, you
14 are the very person that the CAB and many other
15 broadcasters would like us to focus on in terms of
16 building audience around programming.
17 3889 MR. STARK: I'm happy to build an
18 audience.
19 3890 COMMISSIONER WILSON: In an ideal
20 world we would have described video for all
21 programming, but as I am sure the captioning experience
22 has shown you, it does seem to take a long time to move
23 things forward.
24 3891 MR. STARK: Yes.
25 3892 COMMISSIONER WILSON: In the absence
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1 of even a basic level of described video, what category
2 or programming would you suggest be the first focus of
3 this initiative if we are going to take it step by
4 step.
5 3893 MR. STARK: Sure. I mean, you know,
6 I'm happy to hear that. You said we are going to take
7 it step by step.
8 3894 COMMISSIONER WILSON: I said if we
9 are.
10 3895 MR. STARK: I didn't hear the "if".
11 3896 COMMISSIONER WILSON: I can't decide
12 that all by myself.
13 3897 MR. STARK: I understand.
14 3898 COMMISSIONER WILSON: I am just one
15 person.
16 3899 MR. STARK: My issue is that is just
17 one element of access to television service for blind
18 people. It's an important element. What I have tried
19 to say in my presentation to you is that there's a lot
20 you can do with descriptive video before you start
21 talking about the production.
22 3900 If you had to tell me what's the
23 number one thing I would like, it's a way for me
24 individually to know what's on television every night.
25 It occupies one of my basic cable channels. I have got
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1 no choice but to pay for it, but it's totally useless
2 to me. Totally. Even the ads will not mention the
3 telephone numbers most of the time. You can't even
4 watch it for the ads.
5 3901 COMMISSIONER WILSON: There are times
6 when those listings are useless to me too because I
7 can't see very well that far across the room.
8 3902 MR. STARK: Maybe there should be
9 descriptive video on ads too.
10 3903 COMMISSIONER WILSON: And bigger.
11 3904 MR. STARK: And bigger. Oh, well,
12 yes, sure. You see, that was part of what I was trying
13 to say to you.
14 3905 My mother was the other example I was
15 going to use earlier about who can benefit from some of
16 this stuff. My mother in her eighties had lived all of
17 her life as a sighted person. She wouldn't use talking
18 books like I use. She wouldn't do those things because
19 it would mean she was identifying herself as a blind
20 person. As long as her book print kept growing, kept
21 getting bigger, she was happy because she could do it
22 the old way she had always done it.
23 3906 That was my point about the 20 per
24 cent market. There's a lot of people out there,
25 particularly seniors, who would use it who may not want
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1 to identify themselves as a person with a disability
2 and, secondly, may not want to tell you they use it.
3 3907 If you look at ramps, wheelchair
4 ramps these days, the people that use wheelchair ramps,
5 the least amount of people that use them are people who
6 use wheelchairs. People who have baby strollers,
7 people that make deliveries, people that have trouble
8 walking up stairs, all those kings of things. I will
9 bet you in 30 years --
10 3908 COMMISSIONER WILSON: People with
11 rolling briefcases.
12 3909 MR. STARK: Sure, sure. Suitcases.
13 In 30 years you are probably going to find that some
14 people may choose descriptive video as a pleasant way.
15 What's the difference between that and the old radio
16 programs?
17 3910 COMMISSIONER WILSON: Yes.
18 3911 MR. STARK: Sighted people grew up
19 with them until television.
20 3912 COMMISSIONER WILSON: What would be
21 your next two categories after the TV listings? News
22 and weather or --
23 3913 MR. STARK: Well, TV listings, news,
24 sports, some of the stock market stuff, some of the
25 weather, all those public affairs, and also some of the
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1 material that is presented for the sports. That would
2 be helpful too. Just those basic information things.
3 3914 That doesn't say that I wouldn't like
4 to be able to sit down once a week on each of the basic
5 television services and watch one movie with
6 descriptive video. Is that too much to ask? You said
7 you wanted to go step by step. One movie or one
8 program, you know. I would know where it is and it
9 would be promoted and advertised and the television
10 service would advertise it on their television station,
11 you know, "Watch the sinking of the Titanic on Sunday
12 evening" and if you have got SAP, you can hear the
13 descriptive video of it.
14 3915 It's available now. I can buy it.
15 If I can afford to buy it -- WGBH has done a lot of
16 movies in the States. I don't know what the revenue
17 kind of costs are incurred when a television station
18 buys the descriptive video version from the people in
19 the States, but you know, there are hundreds and
20 hundreds of movies available now.
21 3916 In fact, when I talked to you about
22 Los Angeles, and unfortunately I couldn't stay for it,
23 the Titanic was being shown on Sunday afternoon at a
24 local theatre. People had the choice of listening to
25 it in descriptive video or regular sound track.
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1 3917 COMMISSIONER WILSON: We will make
2 sure that -- the National Broadcast Rating Service is
3 appearing before us. We will make sure to ask them
4 some of these questions.
5 3918 It occurred to me as I was reading
6 through your submission, and I have had some experience
7 in the broadcasting industry and in telecommunications
8 in dealing with some of the issues surrounding the deaf
9 and hard of hearing.
10 3919 One of the reasons that they have
11 been very successful in encouraging -- in fact they
12 might say prodding -- the various industries into doing
13 captioning and providing them with services is that
14 they have a number of extremely well organized lobby
15 groups. Are there similar groups for people who are
16 blind or visually impaired?
17 3920 MR. STARK: I mentioned to you
18 earlier the high unemployment rate of blind people
19 which some will argue is a bit less than that, but it
20 certainly is significant. Also, many people who are
21 blind are blinded later in life and are learning a lot
22 of things at once and the resources are scarce.
23 3921 Do you choose between spending your
24 money on advocacy or spend your money on teaching
25 people Braille. Those are the kinds of hard realities
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1 that blind people have to cope with.
2 3922 No, there are not the same level of
3 advocacy groups among people who are blind. There are
4 a number of blind people who do speak out and there are
5 a number of organizations who can speak from time to
6 time, both organizations of the blind and both
7 organizations cross disability like the Council of
8 Canadians with Disabilities.
9 3923 There are lots of organizations, but
10 they are nowhere sophisticated enough to bear the costs
11 of a lot of these hearings. That was my point with the
12 Sir Arthur Pearson Association. If you want that kind
13 of level of intervention, you are going to have to look
14 at intervener funding because we have enough difficulty
15 just maintaining a quality of life and earning a living
16 and looking after eye-dogs and going to the grocery
17 store and shopping where not a price in the store is
18 readable and doing all these other things that putting
19 that kind of burden on us, it is a burden for us,
20 whereas --
21 3924 COMMISSIONER WILSON: I'm not
22 suggesting that that's the way to go, but I just wanted
23 your views on that.
24 3925 MR. STARK: I wanted to try to give
25 you an academic answer. I am leading to one point.
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1 There's a book by Gail Fawcett called "Living in Canada
2 with a Disability in Economic Profile". It's published
3 by Human Resource Development Canada. It talks about
4 disability and it talks about the severity of
5 disability and the handicapping effect of society.
6 3926 I think it's fair to say that the
7 information deprivation that blind people deal with on
8 a daily basis is one of the reasons why there aren't no
9 strong lobby groups. However, with the technology of
10 the computer and access to information that we are
11 getting, we are coming. We will have in the next
12 millennium strong advocacy groups that can do this kind
13 of lobbying.
14 3927 I guess most blind people look
15 towards impartial regulatory bodies like yourself to
16 ensure that the public interest is protected by
17 ensuring that when people talk about viewers, they
18 really mean audiences.
19 3928 I guess I have to leave that one with
20 you by not in a sense saying that there are groups,
21 strong lobby groups. There are some groups, but
22 resources are scarce. You know, frankly, our view is
23 that -- my view anyway is that this is a role that is
24 best performed by the regulator.
25 3929 The final comment I would make on
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1 that subject is I think as we say in our brief, the
2 voluntary approach has been in existence as far as
3 services for blind people for quite some time. It has
4 not produced significant customer service for us from
5 the television system. I think some minimum standard
6 and leadership from the Commission would improve our
7 quality of life.
8 3930 You can't deregulate something that
9 ain't regulated. I'm not aware of, maybe you are, but
10 I'm not aware of any Commission standard or statement
11 on a basic level of access for all people with
12 disabilities. I am aware of some of the good policy
13 papers put out on the question of access for people who
14 are profoundly deaf.
15 3931 I stand to be pointed in the
16 direction of that material because I would like to read
17 it. The answer is I don't think this is something that
18 should be put on the shoulders of blind people to lobby
19 and to, you know -- frankly, and let me finally answer.
20 3932 Given all of the things, it's easier
21 for me to file a complaint with the Canadian Human
22 Rights Commission than it is to start a lobby group and
23 sit through more meetings. You know how hard it is to
24 sit through a meeting. I don't want more meetings. I
25 want musical decisions that allow me to sit home and
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1 enjoy my television.
2 3933 COMMISSIONER WILSON: I want to thank
3 you for answering my questions. My colleagues may have
4 some, but you have certainly helped expand my
5 understanding of this. I want to thank you again for
6 being with us.
7 3934 MR. STARK: Thank you.
8 3935 THE CHAIRPERSON: Mr. Stark,
9 Commissioner Cardozo has some questions for you now.
10 3936 MR. STARK: Thank you.
11 3937 COMMISSIONER CARDOZO: Thanks, Madam
12 Chair.
13 3938 Mr. Stark, first just a rather basic
14 question. If you can give us some more information on
15 descriptive video. You talked about providing I
16 suppose a voice-over or sound for things that are
17 written on the screen such as temperatures, perhaps
18 other types of information that appears in a written
19 alphanumeric form.
20 3939 Would it also provide a sound track
21 for movies and stuff where it will describe the scenery
22 that you are not seeing?
23 3940 MR. STARK: You are quite correct.
24 Your assumption is accurate. Somebody -- you hear
25 "bang, bang", fall down. The descriptive video would
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1 say the gentleman fell over the garbage can.
2 3941 COMMISSIONER CARDOZO: Okay.
3 3942 MR. STARK: The next thing you would
4 hear me swearing about that and you both would hear
5 that because it's easy to understand. You understand
6 what I mean.
7 1710
8 3943 The point is it gives me your visual
9 context, in the same way as the colour commentators did
10 on the radio years ago. That is basic descriptive
11 video, you know, the carriage is coming down the street
12 and it is pulled by four white horses and the carriage
13 is black and there is a gentlemen in a very well-
14 pressed uniform on the back, standing on the back
15 runningboard of the carriage. Those things we all
16 miss.
17 3944 I used to use an example -- and I
18 still can and maybe even coming in here today. I came
19 in here today, your staff greeted me and said who they
20 were. That's helpful because I don't know who is in
21 the room. I don't know who is here and it was very
22 helpful to have you tell me who was at the front table
23 as Commissioners because I don't know. That's a form
24 of descriptive video, if you will, or starting a
25 meeting by saying, "Let's go around the table and say
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1 who's here," even though we know each other, so I know
2 who's here. It's inclusive.
3 3945 So, when you talk about television,
4 it is the action that is described, whereas in the case
5 of people who use closed captioning it is the audio
6 that is described.
7 3946 COMMISSIONER CARDOZO: So, of the
8 things you see on TV from what you are describing is
9 the commentary on a hockey game perhaps the closest
10 thing to descriptive video, the hockey commentary?
11 3947 MR. STARK: The hockey game, the
12 baseball game. The problem with a lot of that though
13 is today the announcers, as my wife is frequently
14 bemoaning, will talk at great length about all kinds of
15 things, including where they went to dinner while the
16 pitches are thrown and she misses. She is quite a
17 sports fan and she likes the Montreal Expos and she
18 likes Formula One and she's an avid sports fan.
19 3948 She sometimes will even prefer the
20 radio because the description is better, but you can
21 even see colour. People ask us why we go to the
22 baseball games in Montreal. Well, it's to hear that
23 ambience, the crack of the bat and people singing "val
24 de ri," "val de ra" while the concrete shakes and the
25 same time you have got an earphone in your ear and you
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1 are listening to Dave Van Horne upstairs describing the
2 game.
3 3949 The same is true of what we would
4 look from television, is to experience visual ambience
5 because even though we don't see well or we may just
6 see colours or we may just see movement, we still want
7 that visual reality.
8 3950 I mean I don't want to come here
9 today wearing a pink suit coat and a purple tie that
10 doesn't go together. It's that basic sort of thing.
11 3951 So, we view information as part of
12 our quality of life.
13 3952 COMMISSIONER CARDOZO: It's a good
14 think you can't see my colleague, Commissioner
15 McKendry's clothes, because they are usually not that
16 well co-ordinated. That's not on the record I hope.
17 3953 MR. STARK: They look fine to me.
18 3954 COMMISSIONER WILSON: You can tell
19 it's Friday afternoon at five o'clock.
20 3955 COMMISSIONER CARDOZO: So I guess
21 Foster Hewitt was the best devious guy around.
22 3956 MR. STARK: Yes.
23 3957 COMMISSIONER CARDOZO: I should
24 mention a couple of things. You have talked about the
25 obligations we have, legal and otherwise. My sense is
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1 that the Commission has a history of dealing with some
2 of the issues concerning which we could sort of put
3 into a grab bag called disability issues perhaps, but
4 in terms of television I think we have gone quite a
5 good distance in things like closed captioning.
6 3958 We have done a lot on the telephone
7 side of things and there seems to be quite a bit of
8 action there over the years and part of it has to do
9 with intervenor funding because under the
10 Telecommunications Act which governs our telephone
11 stuff intervenors can claim costs against other --
12 which are then awarded from other intervenors, namely
13 the corporations.
14 3959 We don't have that ability on the
15 broadcasting side, which is why we are not able to
16 provide intervenor funding in broadcasting and, who
17 knows, that may have something to do with why we have
18 done more on the telephone side.
19 3960 But just on this hearing, I want to
20 let you know that we have heard from the Council of
21 Canadians with disabilities when we had our town hall
22 meetings. One of the meetings was in Winnipeg and the
23 Council is based there and a couple of the members were
24 there.
25 3961 The NBRS is appearing. I seem to
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1 think and I'm pretty sure we have had a brief from the
2 Sir Arthur Pearson group and there are a few other
3 individuals who have written too. So, we certainly
4 hear what you are saying and I just wanted to show you
5 that you are not saying it in a vacuum, that there are
6 various others who made these points to us too.
7 3962 MR. STARK: That's why I wanted to
8 come today because I know -- I think you are concerned
9 and interested and my bottom line message is I think
10 that the accountability should be shifted from the
11 consumer to the service provider and that's really --
12 if you had to sum everything we have said up, it's that
13 as consumers we can't be held accountable for why we
14 need descriptive video. There is no argument. We need
15 it. Whether we can have it all at once or step-by-step
16 that's fine. That's the reality check.
17 3963 COMMISSIONER CARDOZO: Thank you very
18 much.
19 3964 MR. STARK: Thank you, sir, for your
20 questions.
21 3965 COMMISSIONER CARDOZO: Thank you,
22 Madam Chair.
23 3966 THE CHAIRPERSON: Thank you very
24 much, Mr. Stark. We hope you have a nice weekend.
25 3967 MR. STARK: And the same to you all.
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1 3968 THE CHAIRPERSON: I don't think your
2 friend found us very interesting.
3 3969 MR. STARK: No, no. He enjoys
4 carpets. I once had a boss who said to me that after
5 the meeting she always judged whether or not the
6 meeting had gone well by whether or not the dog was
7 happy. If he wags his tail on the way out you will
8 know we had a good meeting.
9 3970 THE CHAIRPERSON: He is a beautiful
10 dog.
11 3971 MR. STARK: Thank you. Thanks for
12 your time.
13 3972 THE CHAIRPERSON: Madam Secretary,
14 would you call the next participant, please.
15 3973 MS BÉNARD: Thank you, Madam Chair.
16 3974 We will now have a joint presentation
17 by the Association of Canadian Advertisers, the
18 Canadian Media Director's Council and the Institute of
19 Canadian Advertising.
20 3975 THE CHAIRPERSON: Good afternoon,
21 ladies and gentlemen. Proceed when you are ready.
22 PRESENTATION / PRÉSENTATION
23 3976 MR. LUND: Good afternoon, Madam
24 Chair, Commissioners.
25 3977 Thank you very much for the
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1 opportunity to appear at this important public hearing.
2 We wish you well, as many people have done before us in
3 your deliberations and are very pleased that we are
4 able to contribute today.
5 3978 I am Ron Lund. I am the President of
6 the Association of Canadian Advertisers and let me
7 introduce you to the delegation.
8 3979 To my left here I have Janet
9 Callaghan. Janet is the Chair of the Canadian Media
10 Director's Council. She is also the Vice-President,
11 Corporate Media Director, The Media Company.
12 3980 Judy Davey on my right here is the
13 ACA's Broadcast Committee Chair and Judy is also in
14 another life the Director of Media and Sports
15 Properties for Molson Brewery, so we have an advertiser
16 her.
17 3981 To my far left we have David
18 Harrison. David is a Director with the Institute of
19 Canadian Advertising and he is also President and CEO
20 of Harrison, Young, Pesonen & Newell.
21 3982 Lastly, handling the slides for a
22 little while is Bob Reaume. Bob Reaume is a media
23 consultant that works with us at the Association.
24 3983 MS CALLAGHAN: Our three
25 organizations represent the advertising buying side of
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1 the business. We are advertising agencies and their
2 clients.
3 3984 Collectively, we are responsible for
4 the placement of at least 85 per cent of the $2 billion
5 that is spent on television annually and, as such, we
6 are the largest financial stakeholder in this vibrant
7 business.
8 3985 Our Associations are appearing
9 together because our interests and our positions are
10 compatible.
11 3986 These positions are that we support
12 universal choice and access.
13 3987 We recommend that non-simultaneous
14 substitution and advanced program substitution be
15 examined further.
16 3988 We believe that any changes to the
17 station ownership limitation policy should be made with
18 caution.
19 3989 And we would like you to consider the
20 benefits of an adequate electronic television audience
21 measurement system.
22 3990 Finally, we wish to register our
23 strenuous objection to deregulation of commercial
24 minutes per hour.
25 3991 Our first point on universal choice
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1 and access is to reiterate that advertisers are always
2 seeking new services that reach their target markets.
3 As such, we have been strong supporters of each new
4 specialty tier.
5 3992 Unfortunately, Canadian audiences are
6 being lost to foreign services at an alarming rate. In
7 just two years the U.S. specialty channel share of
8 English hours tuned has gone from 3.3 per cent to 12
9 per cent. These are viewers that are inaccessible to
10 Canadian advertisers.
11 3993 Accordingly, we would like you to
12 examine opportunities to regain these lost audiences.
13 3994 Our second point is to encourage
14 further examination of non-simultaneous and advanced
15 program substitution.
16 3995 We endorse simultaneous program
17 substitution and recommend that this protection of
18 program rights should in fact be extended to include
19 specialty channels.
20 3996 We acknowledge the significant
21 financial opportunity that non-simultaneous
22 substitution represents to broadcasters in terms of
23 repatriating advertising dollars, but there are key
24 implications that we believe must be examined before
25 proceeding further.
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1 3997 These include the spectre of
2 increasing advertising rates, either through the
3 further limiting of competition or the splitting of
4 audience ratings via multiple runs of popular programs.
5 3998 Other implications include
6 measurement. We need to know if a split signal can be
7 measured.
8 3999 And lastly, whether Canadian
9 programming will be marginalized by this move.
10 4000 Again, we believe more dialogue on
11 this matter before moving forward.
12 4001 Our third position concerns the
13 emergence of the media behemoth, both globally and in
14 Canada, whereby the television industry is dominated by
15 fewer and more powerful media conglomerates.
16 4002 We understand the economies of scale
17 and the need for our broadcasters to compete in a
18 global marketplace, but we do believe that this can be
19 achieved without creating monopolies or duopolies in
20 individual Canadian markets.
21 4003 Competition is the adrenaline that
22 fuels advertising investment, but continued competition
23 in broadcasting is as important a business imperative
24 as critical mass.
25 4004 Our fourth point concerns the
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1 measurability of performance in a fragmented
2 environment. We in our industry face huge increases in
3 TV business complexity.
4 4005 In Toronto alone, there are 30,000
5 spots available for purchase weekly. For us to manage
6 this system, we must be able to measure it well.
7 4006 Indeed, the pressure we have from our
8 client base, comprised of both multinationals and
9 Canadian companies, is to adhere to global advertising
10 effectiveness standards.
11 4007 We in Canada must deploy best
12 practices in our TV audience measurement system to
13 benefit from increased investment.
14 4008 The CRTC and its constituency could
15 benefit immensely, too, by being provided a more
16 accurate picture of the viewing habits of Canadians.
17 4009 We recommend that consideration be
18 given by the CRTC to help fund a superior measurement
19 system in Canada.
20 4010 MS DAVEY: Our fifth and very
21 important point is we would like a reaffirmation of the
22 12-minute limit regulation. We strongly believe that
23 clutter diminishes the value of our commercials.
24 4011 In 1990, the Television Bureau of
25 Canada set a maximum of 30 interruptions per hour to,
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1 as they said at the time, "preserve the integrity of
2 the television medium of the future." The Canadian
3 Association of Broadcasters endorsed this principle.
4 4012 While a 12-minute limit is officially
5 in place in Canada, this limit is frequently exceeded.
6 The result is considerable non-programming clutter. As
7 you can see, the effects of expanding the amount of
8 non-programming time was dramatic under U.S.
9 deregulation, where non-program clutter levels reach as
10 high as 20 minutes per hour.
11 4013 To gain a better picture of the
12 Canadian experience, the Association of Canadian
13 Advertisers conducted studies in 1993 and 1998 to
14 measure the degree of clutter. Nielsen Media Research
15 provided the data for both studies.
16 4014 Each study measured five major
17 markets and close to 7,000 hours of programming across
18 all day parts. And in 1998 we included the addition of
19 three specialty channels.
20 4015 The studies reveal that non-
21 programming clutter has increased dramatically in that
22 five-year period from 1993 to 1998.
23 4016 The key findings showed that dramatic
24 increases in both minutes and messages per hour. For
25 example, in 1993, 49 per cent of all hours had greater
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1 than 12 minutes of non-programming content. And in
2 1998 this grew to 77 per cent. That's an increase of
3 57 per cent in just five years.
4 4017 The average minutes per hour over 12
5 grew from 13.42 minutes in 1993 to 14.52 minutes in
6 1998.
7 4018 Also, in 1993, 47 per cent of all
8 hours measured contained over 30 messages. In 1998
9 this climbed to 58 per cent.
10 4019 At the same time, the average number
11 of messages per hour over 30 grew from 35 in 1993 to 37
12 in 1998. Now, you need to remember that these are the
13 averages.
14 4020 When you look at some worst case
15 scenarios, back in 1993 -- in the 1993 study, the worst
16 incident of clutter occurred in Montreal French. From
17 11:00 p.m. to midnight, where there were actually 46
18 messages, totalling 28 minutes and 30 seconds of non-
19 programming content.
20 4021 If you go to the more recent study,
21 the 1998 study, a couple of examples in one Vancouver
22 incident on August 21st, 35 individual messages were
23 shown between 12:30 p.m. and 1:00 p.m. This would be
24 the equivalent of 70 messages per hour.
25 4022 Looking at another incident in
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1 Calgary on June 23rd, between 2:30 and 3:00 in the
2 afternoon, 13.58 minutes of non-programming content
3 occurred, or the equivalent of 27 minutes per hour.
4 4023 In summary, we can see that the 12-
5 minute limit is regularly exceeded and it continues to
6 grow at an alarming rate.
7 4024 Staying with the 1998 study, let's
8 compare the conventional and specialty channels. What
9 we can see here is that we find that 80 per cent of the
10 hours on conventional stations carried over 12 minutes
11 of non-programming time, while for the specialty
12 channels 51 per cent of the hours carried more than 12
13 minutes.
14 4025 Clearly, the conventional stations
15 are at severe clutter levels.
16 4026 Looking across the markets that we
17 surveyed, you can see that clutter is evident in all of
18 the markets and in this case here Montreal English and
19 Calgary were the worst offenders.
20 4027 To conclude, the present situation
21 obscures the value equation. We don't know what
22 environment we are buying. Is it 12 minutes, 16
23 minutes, 24 minutes or even more minutes? We don't
24 know.
25 4028 Broadcasters are pressing to include
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1 even more minutes and more messages per hour.
2 4029 We buy an environment and clutter
3 devalues that environment. It reduces the
4 effectiveness of our advertising messages.
5 4030 You watch TV. You know how many
6 messages are on there. You see them. We believe what
7 is happening. We have more than enough messages that
8 are on there and to increase the number of commercials
9 for non-programming time isn't fair to the viewer or to
10 the advertising.
11 4031 We don't need more commercials on the
12 outlets we have. We need more outlets with fewer
13 commercials.
14 4032 MR. LUND: Thank you, Janet and Judy.
15 4033 As major stakeholders of the Canadian
16 broadcast industry, advertisers want access to all
17 Canadian audiences to most effectively and efficiently
18 target consumers through the ever-growing viewer
19 choices that they have.
20 4034 I am sorry about that -- we want to
21 ensure a competitive environment, whereby pricing and
22 product will fairly serve the advertiser.
23 4035 We also believe we must have the best
24 measurement system. We need the ability, more than
25 ever, to demonstrate and be accountable for the
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1 significant amount of dollars that are being spent in
2 this ever-fragmenting marketplace.
3 4036 But above all, we believe that we
4 must have some respect for the Canadian television
5 viewer. We must do this by providing a strong
6 programming environment that is not overly cluttered
7 with commercial messages.
8 4037 So, once again, we thank you for
9 allowing us to present our perspective for your
10 consideration and we wish you again well in your
11 deliberations. We would be pleased to answer any
12 questions you may have now.
13 4038 THE CHAIRPERSON: Thank you.
14 4039 Commissioner McKendry.
15 4040 COMMISSIONER McKENDRY: Thank you.
16 4041 Good afternoon.
17 4042 MR. LUND: I like your suit, by the
18 way.
19 4043 COMMISSIONER McKENDRY: Thanks. Tell
20 Commissioner Cardozo that.
21 4044 There were two written submissions
22 provided to us earlier in this proceeding, so I am
23 going to ask some questions that are particular to each
24 written submission and some I suppose that are communal
25 questions, but what I will probably do is send the
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1 questions over to you and you can sort them out amongst
2 yourselves how you would like to respond to the
3 questions or who would like to respond.
4 1725
5 4045 I would like to start off by
6 challenging one of your statements and I don't do this
7 for the sake of just challenging you. It's important
8 that we understand how the broadcasting system work
9 from an economic point of view.
10 4046 You make the claim or the Association
11 of Canadian Advertisers makes the claim that, and I
12 quote, "advertising is the primary resource sustaining
13 the Canadian broadcasting system". It struck me that
14 there are three resources that sustain the Canadian
15 broadcasting system: advertising, appropriations from
16 government -- for example, the CBC appropriation -- and
17 subscription fees paid directly by consumers for
18 broadcasting services. When I added up the
19 subscription fees paid directly by consumers for
20 broadcasting services, I got $2.5 billion and I
21 included in that subscription fees paid for specialty
22 services, for pay TV and subscription fees paid to
23 cable television operators.
24 4047 So, I guess what I would like to get
25 your reaction to is what I see as a growing force in
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1 the economics of television broadcasting in relation to
2 advertising is direct consumer payment and through
3 subscription fees for programming. Does that emerging
4 trend, which is seemingly quite a large trend, have any
5 implications for the role of advertising in the
6 television broadcasting system?
7 4048 MR. REAUME: It certainly does have
8 implications for advertisers and in many other media a
9 similar type of situation exists and advertisers, of
10 course, if you will pardon the slang, just go with the
11 flow. If that's how consumers want to consume their
12 media, we will adapt our advertising targeting to that
13 method and if we can in this case, we certainly will.
14 4049 I still think, though, our assertion
15 that advertising is the primary resource supporting the
16 Canadian broadcasting system is true and I think if you
17 look in CBC's submission, they have a chart -- I wish I
18 had it with me, but they have a chart where they have
19 calculated the entire funding, including private
20 investors, the CTCPF fund, of course, Parliament's
21 contribution to the CBC and every other funding source
22 for the television, and air time sales, even in their
23 equation, is still 51 per cent. So, we really are
24 still the primary funder.
25 4050 This trend, though, that you suggest
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1 and bring to our attention that consumers seem to be
2 willing to pay directly to consume their media is a
3 trend we have noticed and I guess are keeping our eye
4 on.
5 4051 MS CALLAGHAN: One small point there.
6 I believe that that is true in terms of the trend, but
7 if you remember some years back NBC showed the Olympics
8 and they had part of it on a user-pay system, which was
9 a horrible financial disaster. So, I think it needs
10 proving in terms of really big events that the masses
11 want to see. It's questionable whether or not they
12 will pay.
13 4052 MR. HARRISON: I might also add that
14 I think what you are describing is in many ways
15 analogous to other media. To this point, I think
16 Canadians and most people in the free world have
17 received their television services for no direct cost,
18 unlike a newspaper, which you pay for, or a magazine
19 which you may subscribe to. I think you are lumping
20 commercial and non-commercial subscription revenues in
21 that $2.5 billion, so perhaps television is simply
22 becoming more like other media and people are prepared
23 to pay for their editorial, as well as getting
24 advertising support.
25 4053 COMMISSIONER McKENDRY: In any event,
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1 I should take it that this growing trend isn't a threat
2 to advertising revenues as a sustaining force to the
3 broadcasting industry.
4 4054 MS CALLAGHAN: No.
5 4055 MR. HARRISON: But it is important to
6 remember, though, for television to be successful, it
7 must have a great reach available for advertisers. If
8 the reach of consumers were to diminish from a
9 commercial point of view, then the position of
10 television in the equation of which medium would be
11 chosen to advertise in would diminish.
12 4056 COMMISSIONER McKENDRY: The Baton CTV
13 submission that we received in this proceeding
14 describes advertisers as CTV's customers and customers
15 typically play a pretty big role in somebody's
16 business. One of the things I would like to understand
17 is what role advertisers play in Canadian content on
18 television apart from the economic role that we have
19 just discussed. Is there any influence that
20 advertisers have by virtue of being the customers of
21 the networks on Canadian content that we should be
22 aware of?
23 4057 MR. LUND: I think you have heard it
24 several times. Our interest, as we gave you in our
25 submission, is primarily a commercial one. Basically,
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1 what we go for is the audience. I think you have heard
2 it a couple of times today and it's just really
3 something to reiterate it. Our view is as long as the
4 audience is there, we will purchase and if it's
5 Canadian content, we feel even better about that, but
6 that's kind of outside of our purview.
7 4058 COMMISSIONER McKENDRY: You would pay
8 the same amount for Canadian and a foreign program
9 under the similar circumstances?
10 4059 MR. LUND: Absolutely. The example
11 that was given, if there are 2 share points that are 6,
12 we don't see the program other than in an environment.
13 It may be an environment we wouldn't want to be in if
14 it was maybe a violent one for one advertiser or there
15 was another environment that was more closely aligned,
16 but the rating point is what speaks.
17 4060 COMMISSIONER McKENDRY: Let me ask
18 you another general question before I get to more
19 specific questions related to your submissions. One of
20 the things that has been presented to us in this
21 proceeding is data by the Canadian Association of
22 Broadcasters that shows, in spite of significantly
23 increasing expenditure by the broadcasters on Canadian
24 programming over the last few years, Canadian viewing
25 share is flat. It has seemingly been flat for at least
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1 five years hanging in at 40 per cent.
2 4061 One of the focuses of the private
3 broadcasters in this proceeding is they need to get
4 more audience. Now is the time where we have to get
5 more audience. It seems to me that you are the people
6 that are specialists in selling things and selling
7 services. Do you have any thoughts on whether or not
8 Canadian programming can be promoted effectively, as
9 such, in order to increase audience and attract more
10 viewers? Will a marketing campaign do it?
11 4062 MS CALLAGHAN: A big part of
12 attracting viewers is scheduling and it's my belief
13 that in the past the prime time scheduling -- and
14 that's key day parts -- have not been used to promote
15 the best of Canadian programming. I think all of us
16 would endorse the fact that there is more money or a
17 higher quality of Canadian content programming now than
18 there has been in the past, but it is important in
19 terms of scheduling against popular U.S. shows. That's
20 very hard for a Canadian show to compete.
21 4063 So, from our perspective, I don't
22 know that promoting it would make such a big
23 difference. It's really scheduling it and making a
24 consistently high quality of Canadian content.
25 4064 COMMISSIONER McKENDRY: I guess what
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1 I was thinking of was when the CFL was struggling --
2 and perhaps it is still struggling to some extent --
3 they launched an advertising marketing campaign to
4 promote Canadian football as something that people
5 should consume. What I'm thinking of is that kind of
6 solution. Is that a solution that applies to TV or
7 it's more particular to individual programs and when
8 they are scheduled?
9 4065 MR. LUND: I have already hit it.
10 It's like "Reach For The Top". I beat you.
11 4066 I think programming, frankly, is very
12 similar to any other product or service and that is in
13 this particular case the viewer will be the judge of
14 what they want to watch. If you promote it more and
15 it's a bad product, it will go down the tubes quicker
16 if it's not a product that's acceptable. So, as Janet
17 has said, the quality is very much a part of the issue
18 and promoting a product that isn't a good product won't
19 really help.
20 4067 David?
21 4068 MR. HARRISON: I would just observe
22 that it's extraordinarily difficult for Canadian
23 broadcasters or producers to compete against the sort
24 U.S. compact of media propaganda that's available from
25 People Magazine to "Entertainment Tonight" to, you name
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1 it, celebrity horoscopes. It's incredibly difficult.
2 It's as difficult to compete in a marketing sense as it
3 is just in the production sense.
4 4069 MR. REAUME: Just for the record, we
5 should probably say that we do all believe, though, in
6 marketing and advertising. So, if there was a product
7 and a show, we probably think we could increase its
8 audience through some advertising campaign of some
9 sort, yes.
10 4070 COMMISSIONER McKENDRY: Well, that
11 was almost my next question. You pointed out how
12 difficult it was. I was going to say, "but possible".
13 So, it is possible and I just want to come back to the
14 scheduling point. Quality is essential, I take it, but
15 there needs to be some changes in the scheduling. Is
16 that what you are saying?
17 4071 MS CALLAGHAN: I did say that where a
18 program is scheduled, what we have read -- and if I
19 take this to the U.S. example, when "Seinfeld" goes off
20 the air, what is the next huge dual to put in that
21 slot. The Thursday night slot has been very important.
22 So, everybody knows how you program and how you count a
23 program and one of the things is: Are there positions
24 in the weekly schedule that you can put your Canadian
25 program to build an audience? That is done, but more
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1 of that needs to be done. It's obviously an art.
2 4072 COMMISSIONER McKENDRY: I don't know
3 whether or not we are artists, but in this proceeding
4 we could narrow the prime time window that broadcasters
5 must show Canadian programming in. In and of itself,
6 is that a solution?
7 4073 MS CALLAGHAN: I think it would help.
8 Yes, I think it would help. What we have brought up in
9 this discussion here is the whole simulcasting when
10 U.S. programs run. The slot that a Canadian show must
11 actually begin in and build an audience in and build a
12 following, that takes a lot of nurturing and protecting
13 from a much stronger show. So, you have got to build
14 your programs and I think Canadian broadcasters have
15 tried to do that, but it's difficult with the amount of
16 signals that are coming in and the strength of many of
17 the U.S. shows.
18 4074 MS DAVEY: The only thing I would
19 like to add is again it goes back to a qualitative
20 thing and as long as the quality is there, that's
21 important. Even if you do narrow the time period, if
22 you don't have the quality, the viewer won't tune in.
23 4075 COMMISSIONER McKENDRY: Let me turn
24 to some of the more specific matters that you have
25 raised with us in your submissions. One of them is
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1 obviously a concern about clutter. You have provided
2 us with data about the extent of clutter and so on.
3 What I would like to know is do you have any studies or
4 are there any studies that you are aware of that show
5 that increased clutter reduces, one, the effectiveness
6 of advertising and, two, the rates that are available?
7 4076 MR. REAUME: I don't believe we have
8 any studies that we could file with the Commission on
9 this, but I do believe that there are some U.S. studies
10 available. The Association of National Advertisers and
11 the AAAA, the Advertising Agency Association of America
12 I believe they are, both organizations are very
13 concerned about this issue in the United States,
14 particularly since commercial advertising material per
15 hour was deregulated in the mid to late 1980s in that
16 country. I would suspect that they have data on that.
17 4077 MR. HARRISON: I think, though, that
18 if we were to study individual companies' awareness
19 trackings of their commercials -- I don't have any here
20 to share with you, but, anecdotally, I would say that
21 there is a general trend to a lower level of awareness
22 for each commercial over time and I think that would be
23 indicative of the fact that clutter and more
24 fragmentation have hurt our ability to communicate.
25 4078 As to rates, so far as we know, the
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1 same rates are being charged for 14 minutes as we
2 thought would be correct for 12 minutes. So, I guess
3 it's working to the broadcasters' advantage at the
4 moment.
5 4079 COMMISSIONER McKENDRY: If we did
6 eliminate the limit on advertising, is there an
7 argument to be made that competition would limit the
8 number of advertisements? I notice you have given us
9 an overhead with respect to what has happened in the
10 U.S. Is there a peak that's going to be reached there,
11 do you think, through the forces of competition?
12 4080 MR. LUND: The data that we quoted
13 out of the AAAA and the A&A Study in fact consistently
14 say it's becoming an increasingly scary situation.
15 It's something they are continuing to monitor. To the
16 best of my knowledge, that particular study, because
17 they have been doing it for a number of years, did not
18 indicate that there seemed to be a limit.
19 4081 MR. REAUME: The evidence, I think,
20 is that they all started at 12, at least in one day
21 part, and that is daytime in the United States. They
22 are 20 minutes now of commercial time per hour. I
23 don't know what percentage or how much cause and effect
24 is at play here, but I might also point out that
25 viewing to conventional and network shows in the United
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1 States and revenues have been on a down slope also.
2 I'm not saying it's all related to clutter, but that is
3 part of the problem in the United States also.
4 4082 MR. HARRISON: I might just add that
5 one of our group observed a little earlier that what we
6 are seeing in clutter gives "This Hour Has 22 Minutes"
7 new meaning.
8 4083 MS CALLAGHAN: It was me.
9 4084 COMMISSIONER McKENDRY: That was much
10 earlier in the day. It's still early.
11 4085 MR. LUND: We figure if you can do
12 this for three weeks, we can do it for one day.
13 4086 COMMISSIONER McKENDRY: Let me ask
14 about something that caught my attention on the
15 overhead that's titled "The effects of deregulation -
16 U.S. Evidence" where the curves are generally still
17 headed up. I was intrigued at the one for local news
18 that is headed down and seems to have been headed down
19 for some time. Why is local news less attractive as an
20 advertising vehicle?
21 4087 MR. REAUME: I don't know.
22 4088 MR. HARRISON: Well, I think it may
23 be that there is less of it available. I think it may
24 have been replaced by network news in the States. It
25 could be. I'm not certain of that, but that would be
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1 my opinion.
2 4089 COMMISSIONER McKENDRY: Would that
3 explain the clutter issue because --
4 4090 MR. HARRISON: I think it has been
5 pushed to less attractive times, so it's not as
6 attractive from an advertising/purchase point of view.
7 4091 MS CALLAGHAN: I also think the
8 effect of CNN News and the major broadcasters of the
9 networks have taken over the local news.
10 4092 COMMISSIONER McKENDRY: Do you think
11 it's the same situation here in Canada with respect to
12 local news and advertising?
13 4093 MR. HARRISON: I don't think so
14 myself because so much of local news is a showcase for
15 Canadian broadcasters. Still there is a very strong
16 news period scheduled somewhere between 5:00 and 7:00
17 each evening.
18 4094 COMMISSIONER McKENDRY: I wanted to
19 say it's quite refreshing to have somebody say to us,
20 "I don't know." It may be the first in regulatory
21 history in Canada.
22 4095 MR. REAUME: But I am going to find
23 out now that you have asked, though.
24 4096 COMMISSIONER McKENDRY: Thank you.
25 4097 I wanted to talk a bit about the
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1 meter-driven audience measurement that's referred to.
2 You ask us, particularly the submission of the Canadian
3 Media Director's Council and the Institute of Canadian
4 Advertising, to focus on the business infrastructure
5 issues, the meter-driven audience measurement and find
6 ways to alleviate the complexity of meter-driven
7 audience measurement. Now you ask us for some money,
8 which you will have to check with Madam Wylie about
9 before you leave. What specifically do you think we
10 should do, apart from money?
11 4098 MR. HARRISON: Well, money would be
12 fine.
13 4099 COMMISSIONER McKENDRY: Assuming we
14 don't have any money.
15 4100 MR. HARRISON: Well, nobody does.
16 This is a difficulty. You know, so much of what we
17 have heard today centres on what view is a view and
18 fantastic statements are made and generalizations based
19 on the data that we have.
20 4101 We are moving from an era of
21 measuring viewing as a way that people remember what
22 they might have viewed and recorded in a diary to
23 assist an electronic system where there is a better
24 chance that we are going to be able to measure what
25 they actually watch. Now, I think there is big news
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1 potentially here for Canadian programming because one
2 of the trends that we are seeing now that we have some
3 electronic measurement is that, indeed, the big named
4 shows actually don't do as well as we thought they did,
5 that they do closer to the average.
6 1745
7 4102 With diary measurement, people
8 recorded what they thought they viewed, and that was
9 probably a popular show. They would write it down --
10 "I must have watched Seinfeld" because they keep
11 hearing about Seinfeld. But we are seeing that there
12 is in fact a much smaller gap between both shows that
13 were considered to be enormously popular and the rest.
14 4103 While we don't, again, know, there is
15 an assumption that I am making that perhaps we are
16 going to find that there is more viewership to Canadian
17 programming than we thought because, as we are not
18 marketing Canadian programming in quite the aggressive
19 way that American programming is being marketed, it
20 could well be that people are forgetting or did forget
21 to record what they watched in their diary.
22 4104 So I think that it is something that
23 we will undertake, to start looking at whether Canadian
24 programming is in fact doing better than was heretofore
25 the case. And we think, therefore, you have an
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1 interest -- and if you could make it a financial
2 interest, we would be very grateful -- in making sure
3 that we had enough and frequent-enough data to do this
4 analysis. You know, it is about a $20 to $25 million
5 business in Canada, people are always fighting and
6 scrapping to find the money to do it. We don't cover
7 every week, we don't cover every market, we don't have
8 enough meters really to do the job, but I think it is
9 absolutely vital for you and the broadcasters, as you
10 strive to make promises that they must keep, that we
11 have the information that will show us that the viewing
12 is in fact occurring or not, as the case may be.
13 4105 So if you did have a little extra at
14 the of the year, please throw it in the pot.
15 4106 MR. LUND: The evidence, just to
16 support David's hypothesis, came through when the first
17 local electronic metering with Nielsen came out. We
18 found that news broadcasts, which were heralded as
19 heavy watched programs, were there because it is good
20 to watch the news, but what we found out
21 electronically, as people watched the first 10 minutes
22 of the news, the headlines, they weren't watching 20
23 and 30 minutes later. So the halo effect that David
24 refers to may in fact prove true for some of the
25 Canadian programming, or maybe it is not as nice to say
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1 you watched Program A, B or C.
2 4107 The other thing, just to speak in a
3 bit more detail what David referred to, we do have at
4 least one national metering service and soon to be two,
5 but with the fragmentation to make those statistically
6 have integrity and stable at smaller levels, with the
7 fragmentation there has to be a lot more meters put in.
8 Four hundred and fifty meters in the Toronto area, for
9 instance, is just not -- there are 450 meters with one
10 company in Vancouver and 450 meters with another
11 company in Vancouver, kind of measuring the same thing.
12 So there is lot of work to be done because there is
13 accountability to be had in this area; we are spending
14 a lot of money.
15 4108 MS CALLAGHAN: Just very quickly, to
16 bring this full circle -- listening here today,
17 everything is about Canadians, viewers, demonstrating
18 that there is an audience for Canadian programming.
19 Everybody talks about that. We listen to this or the
20 quantitative measures and the qualitative ones -- and I
21 am assuming the qualitative ones are the percentage of
22 Canadian content, the amount of money spent, but who is
23 tracking the audiences and the growth of audiences?
24 4109 Really, when we talk about audience,
25 we are not talking about that kind of audience, we are
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1 talking about an audience that we can target. And with
2 not enough meters the data isn't statistically stable,
3 but if you are going to make Canadian content
4 programming, it isn't necessarily for everyone. Make
5 many programs that have different targets. There are
6 the children as targets, senior citizens or young
7 people or teenagers, but that's what the programming
8 is; it is about the small portions of the whole
9 Canadian population versus something that just
10 satisfies the masses.
11 4110 COMMISSIONER McKENDRY: How many
12 meeters do you need?
13 4111 MS CALLAGHAN: It is our belief --
14 and I am not a statistician, and that's being very,
15 very difficult to come to terms with how many meters we
16 need.
17 4112 The entire United States at one time,
18 the whole networks, that enormous amount of money that
19 goes into network programming, they had 1,800 meters on
20 which they would base the national viewing. And then,
21 of course, there would be diaries market by market, and
22 they are on now household diaries.
23 4113 It would seem to me that that number
24 of 1,800 probably would provide us statistically a
25 stable number regardless of the universe. So probably
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936
1 you would need something like that in, say, a market
2 like Toronto; and again, in a market like Montreal and
3 another one in Vancouver.
4 4114 MR. LUND: To give you an idea,
5 Nielsen right now has about 1,200 meters, I believe,
6 across Canada. That's for a national number again,
7 that's not market by market. To basically beef up the
8 numbers in the individual markets, they have 450
9 additional meters on top of the 1,200 in Vancouver and
10 in Toronto.
11 4115 So you are looking at -- again, I am
12 not a statistician, but you are probably looking 3,000
13 or 4,000.
14 4116 MR. HARRISON: Fifty thousand meters!
15 4117 COMMISSIONER McKENDRY: I find it
16 odd, to be honest with you, because presumably the
17 metering business is somebody's private business, and
18 if there was money to be made in this business,
19 presumably they would be investing in the business.
20 4118 The message I get from you is that
21 there is not money to be made in it, so the government
22 should subsidizing it. For some public policy
23 objective, is that that esentially what it boils down
24 to?
25 4119 MR. HARRISON: I don't think we are
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1 seriously believing the government should subsidize it,
2 but I do think that you should have an interest in it.
3 I think one line in our brief says, if you can't
4 measure it, you can't manage it, and you are in the
5 business of managing. So it would seem to us that you
6 should be really quite concerned with the quality and
7 quantity of audience measurement in this country.
8 4120 COMMISSIONER McKENDRY: Let me turn
9 to paragraph 5.4 of the Canadian Media Directors
10 Council brief. Quite frankly, I didn't quite
11 understand what you were driving at there. Let me tell
12 you what I think you are driving at.
13 4121 It seems to me that you are proposing
14 non-identical substitution as well as non-simultaneous
15 substitution. Have I got that right?
16 4122 MR. HARRISON: At the moment, so far,
17 as I understand it, program services and PSAs are
18 allowed to exploit that time in commercial sections
19 that are in U.S. signals, and I guess if we had a
20 choice we would like to exploit that opportunity
21 because, as we have demonstrated earlier in our
22 presentation, we are starting to lose audience to the
23 American specialties.
24 4123 COMMISSIONER McKENDRY: I want to
25 make sure I understand this. You are suggesting that,
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938
1 where there is a U.S. show coming in on a U.S. service,
2 somebody would substitute a Canadian program for that
3 that isn't identical.
4 4124 MR. HARRISON: Or a Canadian
5 advertisement.
6 4125 COMMISSIONER McKENDRY: Are you
7 talking about just the advertisement or are you talking
8 about the whole show?
9 4126 MR. HARRISON: In this case it would
10 be -- yes, it is the show as well, yes.
11 4127 COMMISSIONER McKENDRY: So that's
12 what leads you to talk about the potential
13 inconvenience to the viewers.
14 4128 MR. HARRISON: Yes. I think our main
15 point is that we think that investigating non-
16 simultaneous opportunities could provide great
17 advantages.
18 4129 COMMISSIONER McKENDRY: You are going
19 beyond non-simultaneous, you are going to non-identical
20 too.
21 4130 MR. HARRISON: Yes.
22 4131 COMMISSIONER McKENDRY: One show
23 about fishing could be replaced by a show about
24 anything except that, or even fishing as long as it was
25 Canadian. We would be blacking out the American
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1 programming --
2 4132 MR. HARRISON: Yes.
3 4133 COMMISSIONER McKENDRY: -- and
4 putting in place a Canadian program.
5 4134 As far as I know, you are the only
6 group that has made that proposal to us in this
7 proceeding
8 4135 MR. HARRISON: Fortunately, we are
9 not regulated.
10 4136 COMMISSIONER McKENDRY: -- or are you
11 aware of anybody else that's supporting that?
12 4137 MR. HARRISON: I would like to think
13 a bit more about that paragraph, to be perfectly
14 honest.
15 4138 COMMISSIONER McKENDRY: Okay, thanks.
16 4139 Just let me ask you a question about
17 advertisers' purchase decisions -- and I am taking this
18 out of the submission of the Association of Canadian
19 Advertisers.
20 4140 There is a reference in paragraph 6
21 to the quality of viewers, and that that's a factor in
22 the decisions that you make. Can you just explain for
23 me what you mean by "quality of viewers" and what is
24 the relative importance of quantity versus quality?
25 4141 MS CALLAGHAN: The quality of viewers
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1 is generally the targeting, but very often there are
2 certain kinds of programs we might choose where we
3 believe that managers, owners, professionals might
4 watch if we have a business target. It all goes into
5 targeting the quality of viewers. It is in essence
6 what makes up a show and does it have a large quantity
7 of a desirable demographic.
8 4142 MR. REAUME: I might also add to that
9 in that specific paragraph, I think we were referring
10 to also that a commercial within a 16-minute
11 environment -- the quality of the viewer receiving our
12 message is much diminished from an environment that is
13 12 minutes.
14 4143 Perhaps we haven't made the point
15 clear enough here. There are a number of exceptions to
16 your regulations from time to time that create a quite
17 legal situation whereby 13, 14, 15, 16, 17 and 18
18 minutes of non-program content are included in an hour
19 of TV programming, and in at least a dozen submissions
20 at this hearing many broadcasters are asking for
21 extensions into other areas, new exceptions to that,
22 which would take us from what I believe right now is a
23 14.5-minute universe to something like a 16.5-minute
24 universe.
25 4144 That is a quality viewer. Capturing
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1 a quality viewer back in the old 12-minute days was a
2 certain value equation; capturing a viewer in today's
3 environment, which is a 14.5-minute environment, is a
4 different value equation, and there has been an erosion
5 there.
6 4145 MR. LUND: To give you an idea, I
7 won't have the dates right -- probably before I was
8 born -- at one point in time the number of minutes was
9 eight minutes and they were basically 60-second
10 commercials. Then it moved to 10 minutes and then 12
11 minutes, and commercials went from 60 seconds to 30s,
12 to 45s, to 20s, to 10s.
13 4146 If you look at some of the programs
14 that we actually analyzed, a couple of the real
15 offenders on this last run that was just from the
16 summer, and when you go through that, in one part of
17 commercials there could be eight commercials in a row.
18 And if you buy into the idea that there should have
19 only been four or five, you could be lost to that
20 viewer.
21 4147 So what we are trying to do is
22 understand, as Judy spoke earlier, what environment are
23 we in fact buying. And that excludes -- because we
24 can't tell how that splits out; and that excludes -- we
25 are not in an election right now. If that was an
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1 election, all that would be on top of that and we could
2 watch some of the people two or three times in one
3 little podge. "Click, next channel, there goes your
4 commercial."
5 4148 So the environment is very, very
6 important to us.
7 4149 COMMISSIONER McKENDRY: Are there any
8 specific changes you would like us to make to the
9 existing regulations with respect to clutter -- because
10 you are indicating that the 12 minutes really isn't 12
11 minutes, it is higher than that. Is there any specific
12 regulation that we have in place that you would like to
13 see changed in order to achieve your goal?
14 4150 MR. LUND: Just before Bob starts,
15 because Bob is the real expert in this area, one of the
16 things I think we have to recognize -- and the
17 Commission I am sure is aware of this, and if not, it
18 should be. One of the problems that the broadcasters
19 do have, and consequently so do we, is in fact the
20 numbers that you saw from the U.S. Part of the reason
21 that ours is now increasing is because the U.S.
22 programming that we are buying in fact has these
23 spaces; so there are new things created in the media
24 world called "interstitials", and there can be two
25 minutes gone that we have to make up for.
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1 4151 So what we would like is to make sure
2 that we negotiate this environment, because it is blank
3 time and you don't want the screen to go blank, but is
4 that now where you get the PSAs, is that where you put
5 the promo spots and that?
6 4152 What we are really worried about is
7 that trying to go from 12 to 14, we are going to have
8 that same problem and create another one or two minutes
9 of commercials per hour, which will just be unbearable.
10 4153 Sorry, Bob. Go ahead.
11 4154 MR. REAUME: I guess we have asked,
12 specifically in our ACA submission at least, for a
13 reaffirmation or a return to a strict delineation of
14 the 12 minutes. That may not be possible for you, it
15 may not be possible for Canadian broadcasters, but
16 certainly, at a minimum, don't increase it any more. I
17 mean, some of the requests in several of the
18 broadcasters' submissions at this hearing are for you
19 to allow them to not count paid advertising as
20 advertising. That's beyond fair at this point.
21 4155 We understand the rationale behind
22 allowing promos for Canadian programs to not be counted
23 as advertising material; it is one of your major goals
24 as an institution. And we are as patriotic business
25 people as anyone else. So we understand those goals.
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1 4156 I will leave it at that.
2 4157 COMMISSIONER McKENDRY: Let me end my
3 questions with a question that will lead us into the
4 next intervener as well. I want to ask you about the
5 impact of digital TV on the Canadian TV market and I
6 suppose the economics of the market. As I am sure you
7 are well aware, digital TV is arriving in the U.S. very
8 soon, this year, and the Canadian Association of
9 Broadcasters have told us that they face huge
10 expenditures to convert to digital, and I guess the
11 cable, the infrastructure does as well.
12 4158 Is there anything on your minds with
13 respect to the transition to digital TV and the speed
14 with which the Canadian industry is making that change?
15 4159 MR. REAUME: Aside from the
16 technology itself, it is obviously something that has
17 to come, and there is one thing that we can be sure of
18 on this side of this table, and it is that probably we
19 will fund it; it will be our money, our advertising
20 money that will create it. I mean, that's where they
21 are going to get the funds for it.
22 4160 MR. HARRISON: I think in the short
23 term it is hard to see what the net benefit is from our
24 point of view. There may well be benefits down the
25 road once bandwidth has improved, I don't know. It is
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1 lots of speculation about that.
2 4161 COMMISSIONER McKENDRY: A concern
3 that some people have expressed is, given that it will
4 light up on November the 1st in the U.S. in some border
5 cities and be available to Canadians over the air,
6 assuming they buy digital TV sets, that there will be a
7 shift of Canadian viewers to American over-the-air
8 stations. I also understand that a direct satellite
9 service will be offering two channels of high
10 definition television in October. The concern is that
11 Canadian viewers will move away.
12 4162 MR. HARRISON: That would have a
13 great effect on us. It would have a great effect of
14 everybody appearing at this hearing.
15 4163 COMMISSIONER McKENDRY: But you don't
16 seem to be too concerned that the emergence of digital
17 TV soon in the U.S. could cause that. Is it fair of me
18 to conclude that?
19 4164 MR. HARRISON: I guess I am thinking
20 more from a production point of view than from an
21 audience point of view. Certainly, if it takes away
22 audiences from Canadian broadcasters, that will be bad.
23 We have woven this intricate web of substitution using
24 the cable system, and I hope we are using substitution
25 with our own direct-to-home satellites. I am not quite
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1 sure what the status of that is. But, without that, we
2 have a very fragile system to contend with.
3 4165 COMMISSIONER McKENDRY: Unless
4 something has changed, the reason it is not on the
5 radar screen for us yet, it is our understanding,
6 speaking to our U.S. counterparts, that, well, yes, it
7 is here, but it will be sometime before it is rolled
8 out, because the other half of it is, someone has to
9 buy that TV set, and that's not a convergence that is
10 going to happen overnight as our understanding is.
11 Yet, it is certainly something that we would be
12 discussing in the future; it is one of the reasons, is
13 it is just not on our screen right now, quite honestly.
14 1805
15 4166 MS CALLAGHAN: It seems to me that
16 there are so many changes and one thing that -- many of
17 us have worked for multinational clients and
18 multinational agencies. We are quite a mature market
19 in Canada. Whilst the fragmentation that is happening
20 in Europe, in Asia and many other countries, we have
21 had fragmentation since the seventies since cable
22 really first began.
23 4167 When anybody looks at Canada, whilst
24 we are fragmenting, whilst there is an erosion of that
25 steady viewer, we have been at a plateau. It is rising
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1 upwards, but it certainly isn't the kind of cataclysm
2 that is happening in many other countries.
3 4168 When digital comes along, when more
4 specialty comes along, when satellite comes along, we
5 are accustomed to that fragmentation and have adjusted
6 to it. In the same way for digital, I don't think any
7 of us are looking as if this is Armageddon.
8 4169 COMMISSIONER McKENDRY: Thank you
9 very much. Those are the questions I had for you.
10 4170 Thank you, Madam Chair.
11 4171 THE CHAIRPERSON: Commissioner
12 Pennefather.
13 4172 COMMISSIONER PENNEFATHER: Thank you.
14 4173 One quick question. I appreciate
15 understanding better your definition of quality of
16 viewers, but I will go back and just be sure I
17 understand very clearly what you mean by quality in
18 terms of program.
19 4174 You mentioned several times, all of
20 you, earlier quality is the issue. From your point of
21 view, what's a quality program, just so I know against
22 what I am comparing it.
23 4175 MS CALLAGHAN: That's a very
24 interesting question and it is used constantly in our
25 business.
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1 4176 Quality is really getting the target
2 that you are interested in from a particular placement
3 of your advertising. I think it is pretentious and
4 many of us say well, if it's quality then it must be
5 highbrow or if it is there to satisfy the viewer.
6 4177 I think if you could compare the best
7 of CBC's programs or the best of their dramas with some
8 of the best of the MuchMusic specials and that kind of
9 thing, they are both perfectly targeted and they
10 deliver the audience they said they would, but if you
11 took it to the television quality terms, then they may
12 not be equal.
13 4178 COMMISSIONER PENNEFATHER: So from
14 your point of view, the term quality means placement or
15 getting the target audience.
16 4179 MS CALLAGHAN: A show that draws an
17 audience that it is intended to draw, yes.
18 4180 MR. HARRISON: I would think, if I
19 may just say, quality is a term that is bandied around
20 a lot. I think it's euphemistic. I think you would do
21 well to strike it from any questions and answers and
22 force people to sort of say what they mean and mean
23 what they say.
24 4181 I don't know what quality means.
25 Quality for a lot of our advertisers means top ten
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949
1 shows. Well, it probably doesn't mean that to you. We
2 salute this notion of quality, but no one can describe
3 what it is. I urge you, as I say, to strike it from
4 these proceedings --
5 4182 THE CHAIRPERSON: That's hard to do.
6 4183 MR. HARRISON: Yes, and insist that
7 everybody try to articulate what they mean without
8 using that word.
9 4184 COMMISSIONER PENNEFATHER: I want to
10 be sure I understand it though. I know it's difficult
11 and I don't want a long conversation about it because
12 it's the end of the day, but I think it's key we have
13 the definition that it means drawing the audience so
14 the advertiser is happy if "X" show drew the audience.
15 4185 Then you get into the vicious circle
16 of what kind of shows are drawing audiences in prime
17 time and it becomes pretty well formats, doesn't it,
18 that are selling?
19 4186 MR. LUND: No. I think Janet hit the
20 nail right on the head. If you want to hit a fisherman
21 and there's a fisherman show, that show may draw only
22 .2 share, but it's very effective against that target
23 audience.
24 4187 Just for your deliberations, that's
25 the other interesting thing about Canadian productions.
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1 Not everything has to be an eight rating, a six rating
2 point or a five or a four. They can be very effective
3 at what they are trying to hit. That could be very
4 effective for us consequently. Not everything has to
5 be "the biggest show".
6 4188 THE CHAIRPERSON: Commissioner
7 Cardozo.
8 4189 COMMISSIONER CARDOZO: Thank you,
9 Madam Chair.
10 4190 I just have a request actually, not
11 so much a question but a request if you could get us
12 some more information. I am coming back to the issue
13 of quality despite your request. See, we don't listen
14 to anybody.
15 4191 MR. HARRISON: I don't like your
16 suit.
17 4192 COMMISSIONER CARDOZO: I guess I owe
18 you lunch, David, at some point.
19 4193 Have you looked at, and I am sure you
20 do, the issue of quality of advertising which we
21 haven't talked about today. I'm just wondering if you
22 can send us some stuff later on because it would open a
23 whole long discussion.
24 4194 I am interested in stuff like to what
25 extent you are looking at issues of whether its sexism
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1 in advertising, as the previous witness' reflection of
2 disability, reflection of racial minorities, et cetera,
3 the kinds of images portrayed through advertising,
4 whether there is material of that kind or whether
5 that's an issue you deal with and if you could file any
6 stuff on that.
7 4195 MR. LUND: I will send you some
8 material. There's an association called Advertising
9 Standards Canada.
10 4196 COMMISSIONER CARDOZO: Right.
11 4197 MR. LUND: On Advertising Standards
12 Canada we sit respectively our organizations on the
13 Board. In that there are things on gender --
14 4198 COMMISSIONER CARDOZO: We have a
15 relationship with them too. What's your relationship
16 to them?
17 4199 MR. LUND: I sit on their executive.
18 A member of ICA also sits on their executive. We are
19 very much partners in the policies set at Advertising
20 Standards Canada. We very much believe in those
21 standards.
22 4200 MR. HARRISON: I think great strides
23 have been made generally in this area. Again, I don't
24 have measurements here, but I know that we were guilty
25 perhaps of having our eyes closed a few years ago. I
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1 think we have really come a long way in terms of gender
2 and gender portrayal diversity in advertising.
3 4201 I suspect, though I don't know, that
4 you would be getting fewer calls and letters
5 complaining. You would have to tell me that, but that
6 would be my suspicion.
7 4202 COMMISSIONER CARDOZO: Thanks.
8 4203 THE CHAIRPERSON: Commissioner
9 Pennefather, you have another question.
10 4204 COMMISSIONER PENNEFATHER: Sorry.
11 Very, very quick.
12 4205 Perhaps you can also get back to us.
13 I was just thinking of another kind of production value
14 and that is the cost of making the commercials and the
15 level of special effects and so on, watching the best
16 commercial shows, et cetera.
17 4206 You look at what looks to me to be a
18 growing pressure to really jazz up even a 15 second.
19 In relation to Commissioner McKendry's point about
20 Canadian programming, the level at which one would have
21 to work to really have an impact is related to that to.
22 4207 If there is any background on that
23 and what's really happening on that and what the
24 standards are again, both international and domestic,
25 against which we must work, I would appreciate knowing
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1 about that.
2 4208 MR. LUND: I will collect some
3 generic numbers. The short answer is they are
4 skyrocketing.
5 4209 MR. HARRISON: Part of the reason
6 they are skyrocketing is because of clutter. You have
7 to shout to be heard.
8 4210 THE CHAIRPERSON: Commissioner
9 Wilson.
10 4211 COMMISSIONER WILSON: I will keep
11 this really quick too.
12 4212 Infomercials. Why don't we just get
13 rid of advertising and have infomercials? I'm just
14 kidding. One of the proposals that the CAB has made is
15 that we legalize infomercials as Canadian content as
16 advertisers. What's your opinion on that?
17 4213 MR. REAUME: We have some member
18 companies who do produce infomercials, many of them
19 multinational companies who would love to have them
20 broadcast in Canada. We think it's not a bad idea if
21 you allow infomercials to be counted as Canadian
22 programming content.
23 4214 MR. HARRISON: It may well be that it
24 would inspire production by advertisers. You know,
25 Canadian advertisers are generally out of the picture
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1 when it comes to program productions.
2 4215 COMMISSIONER WILSON: Do you have any
3 samples, any of you, of infomercials?
4 4216 MR. HARRISON: Do we have samples?
5 4217 COMMISSIONER WILSON: Any sample of
6 an infomercial.
7 4218 MS CALLAGHAN: We can get them.
8 4219 COMMISSIONER WILSON: Could you?
9 4220 MS CALLAGHAN: Sure.
10 4221 COMMISSIONER WILSON: And maybe send
11 us something just so that we can sort of see what's out
12 there, not necessarily the slice and dice kind of --
13 well, I don't know.
14 4222 MR. HARRISON: There you go. You are
15 probably thinking about quality there.
16 4223 COMMISSIONER WILSON: That's right.
17 I'm sorry.
18 4224 Thank you.
19 4225 THE CHAIRPERSON: If I may return to
20 this issue of quality which appears very simple to you.
21 You go to Coca-Cola or whoever. You are selling
22 products in advertising. You have a measure of quality
23 which is "Am I reaching the demographic that this
24 company wants", but surely you appreciate that we have
25 a different songbook about what quality is which is the
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1 Broadcasting Act.
2 4226 To suggest that we can strike the
3 concept of quality in the sense of are we getting the
4 broadcasting system we are supposed to get is rather
5 radical to me. Why should you have your measure of
6 quality in the business you are in and not acknowledge
7 that there can be a different approach because the
8 goals are different.
9 4227 Therefore, if we are told that we are
10 supposed to have a diversity of Canadian programming,
11 reaching a diversity of audiences, et cetera, et
12 cetera, it's not a question just of a high standard.
13 When you look at the system or any part of it you ask
14 yourself well, this is what my aim is, am I achieving
15 it.
16 4228 The measurements or the reference
17 points are going to be very different from yours, and I
18 tell you not easily measured.
19 4229 MR. HARRISON: When you talk about
20 measurement, you and we when we talk about measurement,
21 are really talking about quantity, not quality. They
22 are quantitative measures, not qualitative measures.
23 4230 THE CHAIRPERSON: No, but the quality
24 of the system can also have something to do -- I know
25 it's difficult to measure whether or not -- who are we
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1 to say whether a CBC program appealing to only
2 professionals is a better quality than a very simple
3 child program.
4 4231 We are looking at it from the quality
5 of the system, of the quality of what each sector
6 brings to it and one of the measures of quality there
7 would be is there diversity, is there something for
8 everyone.
9 4232 MR. HARRISON: Isn't that a question
10 of counting, whether there is diversity?
11 4233 THE CHAIRPERSON: Well, I am just
12 looking at quality as a much broader concept which is
13 driven by one's reference point. Yours is are you
14 reaching the demographic, did you sell or buy properly.
15 4234 MR. HARRISON: There where we call
16 that quality, it's really quantity because we are
17 really counting. Can we count the number of people we
18 reach.
19 4235 THE CHAIRPERSON: Well, so are we
20 probably. Is there local news? Is there programming
21 for a diverse audience? That's also quality of the
22 system.
23 4236 The idea, as we explored earlier,
24 that the mere measurement of how many people listen to
25 what program and are they the only programs we are
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1 showing because that's what the most people watch, I
2 would suggest may or may not be quality of the system.
3 4237 Even if there are programs that fewer
4 people watch, we are supposed to try to see to it that
5 every sector of society has --
6 4238 MR. HARRISON: It's the range isn't
7 it.
8 4239 THE CHAIRPERSON: Yes.
9 4240 MR. HARRISON: Making sure there's a
10 range of offerings that meets that definition in the
11 Act.
12 4241 THE CHAIRPERSON: The danger if you
13 suggest only levels of viewership will tell you whether
14 you are doing well puts quality and level or quantity
15 of viewers --
16 4242 MR. LUND: We are not suggesting
17 that.
18 4243 THE CHAIRPERSON: No, no. I am
19 reacting to the suggesting that the word quality should
20 be stricken from the record.
21 4244 MR. HARRISON: It is undoubtedly a
22 facetious recommendation to you, but I believe that
23 there is an element of truth to it.
24 4245 THE CHAIRPERSON: It reminds me of
25 participating in the early eighties with the task force
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1 on sexual stereotyping which your organization, Mr.
2 Lund, was very involved in.
3 4246 Somehow, despite the fact that you
4 tell us you can measure whether you reach your
5 demographics, maybe you succeeded better now, the fact
6 of the matter is commercials that were aimed at women
7 managing a household were extremely offensive to women
8 managing a household.
9 4247 It took months of argument to even
10 get that across. Measurements are not perfect. One
11 tries to do what one can, but I don't know if you can
12 measure better now whether you offend the very
13 demographic that you are reaching, that people watch
14 because there is nothing else of the type of program
15 they watch, they are offended.
16 4248 Presumably it could be shown that
17 women were offended by the advertising, but they were
18 watching the program. Maybe they weren't buying the
19 product.
20 4249 MR. LUND: The measurement is how
21 many people complain now versus complained then. I
22 think you would know that the complaints have
23 significantly gone down.
24 4250 THE CHAIRPERSON: No, but my question
25 is why did it take eight months of task force arguments
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1 to get the advertisers --
2 4251 MR. LUND: Because it was a task
3 force.
4 4252 THE CHAIRPERSON: -- to get the
5 advertising world to realize that maybe women did not
6 wax poetic about whether the shirt collars of their
7 mates were white or not.
8 4253 MR. LUND: Could I make one comment
9 on quality. I would like to make a suggestion to the
10 Commission, if I may.
11 4254 There is one definition of quality.
12 That is whether or not -- it's not a universal
13 definition from trying to be academic or anything --
14 that is the individual viewer will decide the quality
15 on any of these segments you are looking at.
16 4255 If you are trying to persuade person
17 "A" to watch this type of program because it's Canadian
18 or from some place else and they don't want to watch
19 it, they will turn it off.
20 4256 I think the quality is not ours to
21 impose from our perspective, nor the Commission's to
22 impose. The viewer will be the ultimate judge of
23 quality.
24 4257 What we speak very much about in
25 quality isn't that we want quality equals six points of
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1 rating. You can have a program, for instance, like
2 "The Simpsons" that may have a five rating point and
3 you can have "Little House on the Prairie" have a five
4 rating point. The type of audience that would watch
5 "The Simpsons" has a very much different psychographic
6 behind it than "Little House on the Prairie".
7 4258 That particular advertiser if they
8 want to hit "Little House on the Prairie" won't
9 necessarily buy "The Simpsons".
10 4259 It's not just a quantity argument as
11 it relates to quality. Quality is in the eyes of the
12 consumer. They turn it off, the broadcaster doesn't
13 win, the advertiser doesn't win. It's not always about
14 the highest rating only. It's got to do about quality.
15 Sorry.
16 4260 THE CHAIRPERSON: You spoke of
17 offending stations. Is your research in that area
18 sufficiently extensive for you to be able to have
19 measured whether the stations you have identified as
20 offenders suffered from the increased clutter. Is it
21 refined enough to know whether it appeared to have
22 caused a drop in viewership?
23 4261 MR. LUND: No.
24 4262 THE CHAIRPERSON: You don't know.
25 4263 MR. LUND: No.
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1 4264 THE CHAIRPERSON: You can't measure
2 that or you haven't done that.
3 4265 MR. LUND: We haven't measured that.
4 We will ongoing be measuring this in the future. This
5 came from a 1993 study. It just became more intuitive
6 or imperative that this was happening, so what we did
7 was we measured. We started measuring in the lowest
8 months where there is supposed to be low TV inventory.
9 4266 We actually didn't expect it to be
10 quite that high, to be very honest with you. Hopefully
11 we will be able to tie those together at some other
12 future date.
13 4267 THE CHAIRPERSON: You mentioned 12
14 minutes and then rising to more likely fourteen and a
15 half minutes. Assuming that one is in compliance,
16 those additional minutes would be to promote other
17 Canadian shows, considering there may obviously be
18 offenders.
19 4268 You could be in compliance and have
20 12 minutes of actual advertising and have additional
21 non-programming. Considering that you purchase air
22 time on Canadian programs, is there not a point at
23 which some of that is helpful to you because you may
24 have bought air time on a program that is being
25 advertised in this program. If I am making any sense.
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1 4269 MR. HARRISON: Yes.
2 4270 THE CHAIRPERSON: There could be a
3 cross point.
4 4271 MR. HARRISON: There is a quid pro
5 quo. What we are asking for is not only a sort of
6 reaffirmation of the 12 minute rule but a reaffirmation
7 by the industry who only a few years ago themselves
8 thought that 30 messages was enough messages in any
9 given hour.
10 4272 THE CHAIRPERSON: So it's a question
11 of balance.
12 4273 MR. HARRISON: Yes.
13 4274 THE CHAIRPERSON: You do acknowledge
14 that when the Commission exempted from the definition
15 of advertising, advertising Canadian shows could be to
16 your advantage. Right?
17 4275 MS CALLAGHAN: Especially on the U.S.
18 specialty channels.
19 4276 THE CHAIRPERSON: Yes, on A&E for
20 example where you suddenly see the CBC. It's a
21 question then of how excessive it is so that the
22 clutter becomes annoying.
23 4277 MR. LUND: We didn't make a big point
24 of it because we didn't have enough evidence, but I am
25 sure that you have had complaints because my members
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1 have told me they have complained to the CRTC.
2 4278 What worries me about that is in fact
3 that they use the time not only for promoting their
4 cable network, but then sometimes they might also have
5 a competitor. Then they start to slide into other
6 products and services. Again, we haven't monitored
7 that, but we know that some of our members are doing
8 that.
9 4279 THE CHAIRPERSON: Yes, we have dealt
10 with some of these complaints.
11 4280 Thank you very much for your
12 appearance and for patiently waiting until this late
13 hour to appear before us.
14 4281 Legal counsel. I will be impeached
15 any minute.
16 4282 MS PATTERSON: Thank you, Madam
17 Chair.
18 4283 In your presentation this afternoon
19 you referred to a number of ACA Canadian clutter
20 studies. I just wondered whether it was possible for
21 you to file those with the Commission.
22 4284 MR. LUND: I certainly will.
23 4285 MS PATTERSON: Would it be possible
24 to file them by the 15th of October 1998?
25 1830
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1 4286 MR. LUND: The 1998 one is only the
2 summer wave, but we will file that much. We won't have
3 the second wave completed by then, but we will file
4 what we have shown as statistics today.
5 4287 MS PATTERSON: Thank you.
6 4288 The same going for the additional
7 information requested pursuant to Commissioners
8 Pennefather's and Wilson's requests?
9 4289 MR. LUND: Yes. What I have recorded
10 was -- I am not quite sure if you still wanted
11 information on Advertising Standards Canada, but we can
12 certainly send you some -- the cost of making
13 commercials, where it has moved and, lastly, some
14 examples of infomercials.
15 4290 MS PATTERSON: Thank you.
16 4291 COMMISSIONER CARDOZO: The
17 Advertising Standards you would have access to, I am
18 just wondering if there is anything on those subjects
19 from your organizations?
20 4292 MR. LUND: We dialogue as a multi-
21 partite industry member in that regard.
22 4293 COMMISSIONER CARDOZO: That's fine.
23 4294 MS PATTERSON: Thank you.
24 4295 MR. LUND: Is that a no then to ASC?
25 4296 COMMISSIONER CARDOZO: That's right.
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1 Yes.
2 4297 MS PATTERSON: Thank you.
3 4298 Thank you, Madam Chair.
4 4299 THE CHAIRPERSON: Thank you, ladies
5 and gentlemen, and have a nice weekend -- a quality
6 weekend, whatever that means, for each of you, but all
7 I can tell you is we will be here tomorrow.
8 4300 Madam Secretary, would you invite the
9 next participant, please.
10 4301 MS BÉNARD: Thank you, Madam Chair.
11 4302 The next presentation will be by
12 Canadian Digital TV, Mr. Michael McEwen.
13 4303 MR. McEWEN: Madam Chair, do you want
14 to hold this for tomorrow? You have had a long day.
15 4304 THE CHAIRPERSON: It is up to you,
16 Mr. McEwen.
17 4305 MR. McEWEN: I am quite prepared to
18 do it now or I cam quite prepared to come and do it
19 first thing in the morning.
20 --- Off record discussion / Discussion hors
21 transcription
22 4306 MR. BLAIS: It is also for the
23 translating staff and stenographers, they may be also
24 tired. So, if that's not too inconvenient maybe that
25 would be an idea.
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1 4307 THE CHAIRPERSON: Do you have any
2 objection to being the first appearing tomorrow morning
3 at 9:00?
4 4308 MR. McEWEN: At 9:00?
5 4309 THE CHAIRPERSON: Yes.
6 4310 MR. McEWEN: Done.
7 4311 THE CHAIRPERSON: We are resuming at
8 9:00. I am sorry, we should have negotiated this
9 earlier, although I am sure you are most interested in
10 what was going on.
11 4312 MR. McEWEN: I found the discussion
12 very interesting.
13 4313 THE CHAIRPERSON: Thank you, Mr.
14 McEwen, and have a quality evening.
15 4314 MR. McEWEN: That's going to be the
16 line of the hearing.
17 --- Whereupon the hearing adjourned at 1832,
18 to resume on Saturday, September 26, 1998
19 at 0900 / L'audience est ajournée à 1832,
20 pour reprendre le samedi 26 septembre 1998
21 à 0900
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