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                       SUBJECT / SUJET:


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 26, 1998      26 septembre 1998

                           Volume  4



Afin de rencontrer les exigences de la Loi sur les langues
officielles, les procès-verbaux pour le Conseil seront
bilingues en ce qui a trait à la page couverture, la liste des
membres et du personnel du CRTC participant à l'audience
publique ainsi que la table des matières.

Toutefois, la publication susmentionnée est un compte rendu
textuel des délibérations et, en tant que tel, est enregistrée
et transcrite dans l'une ou l'autre des deux langues
officielles, compte tenu de la langue utilisée par le
participant à l'audience publique.

                 Canadian Radio-television and
                 Telecommunications Commission

              Conseil de la radiodiffusion et des
                télécommunications canadiennes

                  Transcript / Transcription

              Public Hearing / Audience publique

              Canadian Television Policy Review /
               Examen des politiques du Conseil
             relatives à la télévision canadienne


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


Jean-Pierre Blais       Commission Counsel /
                        Avocat du Conseil
Margot Patterson        Articling Student /
Carole Bénard /         Secretaries/Secrétaires
Diane Santerre
Nick Ketchum            Hearing Manager / Gérant de

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 26, 1998      26 septembre 1998

                           Volume  4


Presentation by / Présentation par:

CDTV, Canadian Digital TV                                  967

CIFVF, Canadian Independent Film and Video
Fund / FCFVI, Fonds canadien du film et de
la vidéo indépendants                                     1022

Manitoba Film & Sound                                     1067

Alberta Motion Picture Industries Association             1093

Vision TV                                                 1112

Canadian Independent Film Caucus                          1161

Independent Film & Video Alliance / Alliance
de la vidéo et du cinéma indépendants                     1203


                           Volume 3
           September 25, 1998 / Le 25 septembre 1998

Page    Line /  

946       3     "COMMISSIONER McKENDRY:  Unless"
                should read / devrait se lire
                "MR. LUND:  Unless"


 1                                  Hull, Quebec/Hull (Québec)
 2     --- Upon resuming on Saturday, September 26, 1998
 3         at 0901/L'audience débute le vendredi
 4         26 septembre 1998 à 0901
 5  4315                 THE CHAIRPERSON:  Good morning.
 6  4316                 Madam Secretary, would you please
 7     call the next participant?
 8  4317                 MS BÉNARD:  Thank you, Madam Chair. 
 9     The next presentation will be by Canadian Digital TV,
10     Mr. Michael McEwen.
11  4318                 THE CHAIRPERSON:  Good morning, Mr.
12     McEwen, and thank you for coming back this morning at
13     such an early time for Saturday.
14  4319                 MR. McEWEN:  My pleasure.  I hope you
15     all had a good rest.
16  4320                 THE CHAIRPERSON:  Yes, of course. 
17     Proceed when you are ready.
19  4321                 MR. McEWEN:  Thank you, Madam Chair
20     and Commissioners.  Canadian Digital Television, CDTV,
21     appreciates the opportunity of appearing today and
22     elaborating on our written submission.  Just for the
23     record, I think I know you all, but my name is Michael
24     McEwen.
25  4322                 Over the past couple of years the


 1     television industry has worked hard to lay out the
 2     framework for a transition plan from analog to digital
 3     TV.  The results were a comprehensive set of
 4     recommendations from the Minister's Task Force on the
 5     Implementation of Digital Television and the setting up
 6     of an industry "not for profit" company to guide the
 7     transition.  We have made a good beginning.  It is now
 8     time for government to play its role and you, the CRTC,
 9     to play yours.
10  4323                 Perhaps this morning I could begin by
11     bringing you up to date on the recent establishment of
12     CDTV.  The Board authorized a start-up period of three
13     months, June through August of this year, to prepare a
14     business plan and detailed work activity for the coming
15     year.  We formed four working groups:  technical,
16     communications policy and regulation, economic and
17     marketing, and production and training.
18  4324                 Each group met and began to define
19     the work ahead.  Numerous subcommittees were formed and
20     by early September a detailed business plan was
21     prepared and tabled for Board consideration on
22     September the 8th.  The Board met and considered the
23     plan, required budget, mission statement and governance
24     issues, the result an approved plan and budget for the
25     fiscal period, September through August of next year,


 1     an ambitious plan that includes a test transmitter,
 2     launching a newsletter, web page, economic modelling,
 3     market research and consumer education.
 4  4325                 Our Board includes three members each
 5     from broadcasters and cable, and one each from pay and
 6     specialty, manufacturers, and satellite.  Our Chair is
 7     Jim Sward, President and CEO of the Global Television
 8     Network, who is here with us today, and just as an
 9     aside, it is in part his vision and leadership, along
10     with our Treasurer Richard Stursberg, President and CEO
11     of the Canadian Cable Television Association, that this
12     group has come together.
13  4326                 An important point to consider is
14     that all members of the Board confirmed that all
15     parties in CDTV are committed to a coordinated roll-out
16     of digital television and will work together to that
17     end.  Given the difficult nature of a transition that
18     digital TV presents, this is a significant industry
19     achievement.  We now need to be joined by our
20     government and CRTC partners.  Our current membership
21     is at 24 and expanding.  We have set up offices here in
22     Ottawa and, as I speak, our work begins.
23  4327                 Ten days ago in New York City William
24     Kennard, Chairman of the FCC, spoke to a meeting of the
25     International Radio and Television Society.  He said,


 1     and I quote:
 2                            "When it comes to digital TV,
 3                            some may have doubts, but there
 4                            should be no doubt about this: 
 5                            Digital is the future of TV... 
 6                            Develop your business plans. 
 7                            Make your investments.  And be
 8                            confident, as I am, that what
 9                            lies ahead is a bright future."
10  4328                 These remarks were made in the
11     context of 28 stations signing on digital services in
12     the top ten American markets in November.  Seventeen
13     stations in other markets will sign on at the same
14     time.  By the way, Detroit and Seattle border stations
15     are signing on in November.  The rest of the top ten
16     will be on the air by May of next year and by the end
17     of 1999 the top 20 markets will be on the air.  Well
18     over 50 per cent of the American population will be
19     able to receive digital terrestrial signals within 15
20     months.
21  4329                 All U.S. broadcasters should be on
22     the air by 2003 and shut down of analog is projected
23     for 2006, an ambitious transition strategy to be sure
24     and one that may be subject to change, but they have a
25     plan.  The United States have committed their future to


 1     digital services: wide-screen television pictures, HDTV
 2     and eventual multi-media applications.
 3  4330                 For the Canadian industry the impact
 4     is equally clear:  Make the transition in a timely
 5     manner or face irrelevance in the wake of American
 6     competition.  That transition will be challenging for
 7     broadcasters, cable operators, satellite services, pay
 8     and specialty providers and program producers.  We
 9     don't know all the costs yet.  That will be our job
10     over the coming months, to define with more precision
11     and create the economic models that work best for the
12     industry.
13  4331                 But what we do know is a bit
14     daunting.  For over-the-air broadcasters the cost of
15     building a DTV transmission system is about $500
16     million.  Depending on how many HDTV channels they
17     carry, the cost to cable could be between $800 million
18     to $1 billion and a half.  These costs don't reflect a
19     myriad of other issues, like equipment upgrades for
20     wide-screen and eventual full HDTV studio and master
21     control upgrades, and the list goes on.  Some of this
22     can be handled with normal replacement procedures, but
23     a great deal will be incremental to currently planned
24     expenditures.
25  4332                 These are investments that must be


 1     made just to keep the Canadian broadcasting system
 2     competitive and, some would argue, just to keep it. 
 3     Yet there is no return on investment beyond staying in
 4     business in the short to mid term.  Down the road
 5     service enhancements may provide the kind of value
 6     added services that viewers will want to buy, but those
 7     service ideas are still in their infancy today.
 8  4333                 It has been suggested that if
 9     Canadians aren't exposed to wide-screen digital TV,
10     they won't miss what they don't see.  I'm afraid that
11     just isn't realistic.  Digital video discs are taking
12     the market by storm and they will be capable of feeding
13     new HDTV wide-screen receivers directly.  DVDs will
14     provide consumer incentive to purchase HDTV displays.
15  4334                 Publicity associated with a U.S. DTV
16     launch will certainly stimulate public interest in
17     Canada.  Canadian viewers will expect domestic TV
18     services to be able to provide services comparable to
19     U.S. broadcasts.  Historically, Canadians have opted
20     for media services from the U.S. if they are not
21     available in Canada.
22  4335                 It has also been suggested that the
23     costs of sets will be outrageously high.  Yes, they
24     will be expensive, but if you allow for inflation, the
25     cost of the first colour sets were close to $7,000 and


 1     those prices tumbled as most consumer electronic
 2     products do after their initial market launch.  Already
 3     we are seeing major reductions in the market price and
 4     in many cases the TV sets aren't even on the store
 5     shelves yet.
 6  4336                 The challenges facing program
 7     production are equally complex.  Initially, wide-screen
 8     HDTV will be more expensive to produce.  Some estimates
 9     are in the 20 to 25 per cent range.  Some producers I
10     have talked to say, "No problem, it's just the cost of
11     doing business and when the time is right, we will do
12     it."  Fair enough, but where does the money come from?
13  4337                 There are only a finite number of
14     sources, the production fund, licence fees and program
15     sales, probably export.  These sources are already
16     being pushed to the limit and you have to wonder what
17     the impact will be to the quantity and quality of
18     Canadian programming, and this at the very moment when
19     we are going to need a lot of wide-screen digital
20     product to ensure that Canadian viewers have
21     competitive Canadian programming alternatives.
22  4338                 The U.S. has no shortage of HDTV
23     products since most of their prime time programs are
24     produced in easily convertible 35 millimetre film.
25     Unfortunately, Canadian program libraries are not in


 1     the same shape.  This means the Americans will have an
 2     inexhaustible source of wide-screen programming that
 3     can be recycled and made available to the global
 4     marketplace.
 5  4339                 The challenge for our industry is to
 6     create wide-screen digital product first for Canadian
 7     viewers and then seize the opportunities in the global
 8     marketplace.  The world will rapidly move to wide-
 9     screen digital TV.  Europe, Australia, Japan, Korea,
10     Taiwan have already announced firm plans for a digital
11     transition.  There will be a shortage of product to
12     begin with and it's that shortage which may provide our
13     producers with a real opportunity.  To exploit the
14     circumstances, they should now be planning for wide-
15     screen digital production.  Otherwise, the market will
16     be even more dominated than it is now by American
17     program sources.
18  4340                 We need to think through how we
19     exploit the technology to the benefit of the viewer and
20     the marketplace.  There are real synergies building
21     between broadcasters, distributors, software suppliers
22     and producers to create multimedia digital platforms
23     that are much more than just a picture.  In the long
24     term this is where the real benefit of moving to
25     digital lies.  It is not merely a transition, it is a


 1     revolution.
 2  4341                 And we are at the very beginning of
 3     change, but change in the "bit and byte" digital world
 4     tends to accelerate almost uncontrollably.  Given
 5     events in both the U.S. and Europe, it is time we get
 6     Canada's strategy in place, understand our direction
 7     and begin dealing with our issues.
 8  4342                 We are already 18 months to two years
 9     behind the U.S.  Our plan contemplated this time lag,
10     but it will be dangerous to fall much farther behind. 
11     Just as we lost viewers to American signals when they
12     moved to colour, we will lose viewers to their digital
13     programming if we are not offering our own.  It is both
14     an economic and cultural threat to the Canadian
15     broadcasting system which must be met with action.
16                                                        0915
17  4343                 We now need a transition plan, and
18     you have a role in creating the regulatory framework
19     that provides the benchmarks for that plan.  Once a
20     transition plan is in place, industry has the base from
21     which it can make business plans and begin the
22     transition.  Then, together, we can monitor and adjust
23     that transition plan as appropriate.
24  4344                 As I noted in my written
25     intervention:


 1                            "A successful transition to a
 2                            digital world and wide screen
 3                            TV, improved picture quality and
 4                            the opportunity for multimedia
 5                            services will ensure the health
 6                            of the Canadian Broadcast System
 7                            and into the 21st century.  A
 8                            healthy and competitive system
 9                            will respond to Canadians who to
10                            see themselves, their
11                            communities and culture on TV."
12  4345                 Thank you for your attention.  Of
13     course, I would be pleased to answer any questions.
14  4346                 THE CHAIRPERSON:  Thank you, Mr.
15     McEwen.
16  4347                 Commissioner McKendry?
17  4348                 COMMISSIONER McKENDRY:  Thank you,
18     Madam Chair.
19  4349                 Good morning, Mr. McEwen.
20  4350                 MR. McEWEN:  Good morning.
21  4351                 COMMISSIONER McKENDRY:  You say in
22     your oral comments to us that we are already 18 months
23     to two years behind the U.S.  Does that mean, given
24     that digital TV signals will be commercially available
25     in the U.S. in November, that there will be two years


 1     of American digital signals spilling into Canada before
 2     I as a consumer can receive Canadian digital signals?
 3  4352                 MR. McEWEN:  That is the assumption I
 4     am making, and let me explain why.
 5  4353                 In December of 1996 the Americans
 6     adopted the A53 standard, the transmission standard,
 7     and four months later, or three months later -- I think
 8     it was the 1st of April, 1997 -- the FCC made its rule-
 9     making decisions and laid out the framework for
10     transition.
11  4354                 So if you take those dates from the
12     time that that plan was actually issued and out, 18
13     months later they are on the air and beginning their
14     transition.  We have yet to build a test transmitter
15     and test some of our allotments and various issues.
16  4355                 We are assuming that if we get a plan
17     in place that all the parties have agreed to, it will
18     be an 18-month to two-year time lag.  If we start
19     today, we can roll it out that way.
20  4356                 COMMISSIONER McKENDRY:  And do you
21     think we will start today?
22  4357                 MR. McEWEN:  I certainly hope so.
23  4358                 COMMISSIONER McKENDRY:  I know you
24     hope so.  But realistically, is that your assessment of
25     the situation; that we are on top of this?


 1  4359                 MR. McEWEN:  I am concerned that we
 2     have not had the kind of response to the Task Force
 3     Report -- the industry is concerned.  What we want is
 4     some recognition of direction here.  Are we moving to
 5     the digital world or not?  We think we are.
 6  4360                 Industry Canada has published a
 7     transmission standard.  There is an allotment plan out
 8     there.
 9  4361                 What we need is confirmation that we
10     are actually going to move from analog to digital and
11     that there is a framework by which the industry can
12     start to make some plans.
13  4362                 We are going ahead through CDTV and
14     starting to solve some of the issues right now.  For
15     example, there is now a proposal for a test
16     transmitter.  It has been approved by the board, and we
17     are going to go around and see whether we can raise the
18     resources for that from the various sector parties,
19     including government.  We hope to have that on the air
20     within six to seven months.
21  4363                 We can take that initiative, but
22     initiative is kind of in a vacuum without the policy
23     framework and regulatory framework in place.
24  4364                 COMMISSIONER McKENDRY:  In the United
25     States the FCC has in fact, as you pointed out to us,


 1     said we are going to digital, end of story.
 2  4365                 Are you looking to the CRTC to make a
 3     similar statement?
 4  4366                 MR. McEWEN:  What I am looking for
 5     from the CRTC -- because the nuts and bolts of a
 6     transition plan are there.  I assume since the FCC is
 7     both a government and regulator -- it is more than just
 8     a regulator; it has some policy application with
 9     Congress as well.
10  4367                 I think government has to indicate
11     the policy framework of removing, and I think it is up
12     to you folks to work with us to build the framework for
13     that move.
14  4368                 COMMISSIONER McKENDRY:  So the first
15     step is an indication from the government that we are
16     going to digital, if in fact the government wants to
17     take that initiative.
18  4369                 MR. McEWEN:  Yes.
19  4370                 COMMISSIONER McKENDRY:  And then you
20     see the Commission's role, following on that statement
21     from the government, to be what?
22  4371                 MR. McEWEN:  Well, to sit down and
23     map out all the elements of a transition plan.
24  4372                 For example, there are a number of
25     recommendations in the Task Force Report.  Every over-


 1     the-air broadcaster who holds a licence now, the
 2     recommendation was, should be granted a digital licence
 3     for a period of time during the simulcast transition.
 4     That needs to be confirmed -- the process for going at
 5     it.
 6  4373                 You have had some experience in this
 7     before with digital radio.  The CRTC also sat as
 8     observers on the task force, so probably has a great
 9     deal of knowledge on these issues.
10  4374                 There are timetable issues.  There
11     are monitoring issues.  There are experimentation
12     issues.  Outside of simulcast, how many hours of
13     experimental television could happen?  What is the
14     transition timeframe in Canada, and how do we monitor
15     that to ensure that the industry and Canadians are
16     making the transition in the most economic and timely
17     manner?
18  4375                 COMMISSIONER McKENDRY:  Rather than
19     waiting for the government to give the green light and
20     the Commission to set up a framework for the nuts and
21     bolts, what prevents a broadcaster today from saying to
22     his or her shareholders:  "Digital has arrived.  We
23     have to go digital now."
24  4376                 What is to prevent the broadcaster
25     from taking that step?


 1  4377                 MR. McEWEN:  In theory, nothing. 
 2     This is a huge, huge undertaking.  And the investments,
 3     as I tried to indicate to you, are in the billions of
 4     dollars without ROI.  We have had a history in this
 5     country of coordinating these kinds of changes.
 6  4378                 Frankly, in the absence of government
 7     policy and the proper transition framework that creates
 8     a transition plan, everybody is left out there swinging
 9     in the breeze.
10  4379                 Even in the United States, in theory
11     the freest market in the world, they at least have a
12     framework; they have a plan.
13  4380                 Right now we have a suggested plan on
14     the table, and the benchmarks are pretty good, I think. 
15     The industry feels fairly comfortable about it as a
16     base.  I think that the industry deserves the
17     assurance, if they are going to make the investment,
18     that this is in fact Canada's intent.
19  4381                 COMMISSIONER McKENDRY:  We earlier in
20     the hearing had a panel of program producers appear
21     before us, large and small ones, from across the
22     country.  I discussed with them their views on the
23     evolution to digital.
24  4382                 One of them, a Ms Schuyler, said --
25     and I will quote from the transcript:


 1                            "I now have, own, or the bank
 2                            owns, a hundred thousand square
 3                            feet of digital square feet in
 4                            Toronto.  It's a huge operation
 5                            there."
 6  4383                 The point she was making is that they
 7     are not waiting around; they are going ahead.  She has
 8     done it, presumably without the government giving the
 9     thumbs up or the Commission initiating any proceedings
10     in this area.
11  4384                 That is what led me to my question: 
12     Why can't a broadcaster start the ball rolling?
13  4385                 MR. McEWEN:  Well, if a broadcaster
14     came to you for a licence right now, it would be an
15     experimental licence.  It would not be a real licence;
16     it would be an experimental licence.
17  4386                 COMMISSIONER McKENDRY:  Yes.
18  4387                 MR. McEWEN:  So you are going to give
19     out what -- 100 experimental licences?
20  4388                 COMMISSIONER McKENDRY:  I don't know,
21     because nobody has come to us and asked us for
22     anything.  As a regulator, I cannot say what we are
23     going to do until somebody asks us to do something.
24  4389                 My point is that the production
25     industry -- we are quite clear that, yes, digital is


 1     here.  We are doing something about it.
 2  4390                 My sensing is that the broadcasters
 3     are saying:  Yes, digital is here but we are going to
 4     wait until the government does something about it.
 5  4391                 MR. McEWEN:  No, I don't --
 6  4392                 THE CHAIRPERSON:  You don't want an
 7     experimental licence, Mr. Sward.
 8  4393                 MR. SWARD:  If you had one.  I was
 9     just asking Michael to pick one up for us.
10  4394                 COMMISSIONER McKENDRY:  Please feel
11     free to join us up here, if you would like to.
12  4395                 Perhaps you could identify yourself
13     for the record.
14  4396                 MR. SWARD:  My name is Jim Sward.  I
15     have the pleasure to be the Chairman of CBTV.
16  4397                 The reason Ms Schuyler has made this
17     investment, this courageous investment, is because she
18     has opportunities to sell programs to the United States
19     and is anticipating, as Michael said, that there is
20     going to be a real market for this kind of product.
21  4398                 She is getting her business ready to
22     move on that market.  It is a good business move and a
23     courageous move.
24  4399                 As broadcasters, about 80 percent of
25     our distribution is through cable.  That is unlike the


 1     United States where it is about 50 percent.  They still
 2     have a very powerful influence with their over-the-air
 3     signal.  If they put out a digital over-the-air signal
 4     that gets wide screen, and that becomes popular, then
 5     they are able to use that to lever the cable industry
 6     to get with the program and deliver their signal wide
 7     screen.
 8  4400                 In Canada, we don't have that kind of
 9     leverage, do we, Michael?
10  4401                 MR. McEWEN:  No.
11  4402                 MR. SWARD:  We are up to 80-85
12     percent, and in some markets over 90 percent.  We don't
13     have enough of an off-air market to be able to use that
14     to lever the rest in a private market sense, in a
15     competitive market sense; to lever them to come along
16     and get with the program.
17  4403                 We have to sit down and work out a
18     plan that involves them.  That has been the art and the
19     work in this whole exercise; to get all the pieces
20     committed to spending the billions that it is going to
21     cost, in a logical order, so that when we turn on the
22     switch, folks with cable, who have just bought their
23     new monitor, will be able to plug it in and have it
24     light up.
25  4404                 That is why it does not make a lot of


 1     sense for us to go right now.  In most cases, we would
 2     be just running a high def, envelope sized picture,
 3     into the cable company and they would crunch it back
 4     into good old analog, the way it is now.
 5  4405                 Sorry to interrupt.
 6  4406                 COMMISSIONER McKENDRY:  No.  That is
 7     very helpful.  Please feel free to interrupt.
 8  4407                 Assuming that it is acceptable to Mr.
 9     McEwen, please feel free.
10  4408                 MR. McEWEN:  I actually asked him to
11     come up and sit with me.
12  4409                 COMMISSIONER McKENDRY:  Part of the
13     dilemma that is chasing at your heels, or nipping at
14     your heels, is the spillover from your U.S. competitors
15     over this two-year period.  You have to trade off the
16     potential loss of viewers to your U.S. competitors with
17     your ability to get the system here moving in the
18     direction you want it to move in.
19  4410                 Is that the dilemma you are facing as
20     a broadcaster?
21  4411                 MR. SWARD:  I think the lag is going
22     to be getting reasonable priced high def TVs on the
23     shelves of stores, that consumers can afford in a
24     meaningful number that it starts to affect your
25     audience levels.


 1                                                        0925
 2  4412                 What we are seeing coming out of
 3     manufacturers is that people will be buying high
 4     definition not unlike the way we buy audio equipment
 5     and components and you will be matching up, you know,
 6     different pieces and so on and so forth.
 7  4413                 It will be quite a different world. 
 8     There is a grace period on the consumer level. 
 9     Although at our last meeting, I thought the grace
10     period was going to be from -- well, the first one Sony
11     told us they had was $10,000.  I think they were going
12     to bring it to the CNE or something.  That was about
13     the only place they were going to bring it.
14  4414                 I understand now Toshiba have hit the
15     market with a $1,500 monitor which kind of surprised
16     them all and they are all scrambling to react, so this
17     curve down could be a lot faster than we are thinking. 
18     That's where we will get the grace period, Commissioner
19     McKendry, on the consumer side.
20  4415                 It could be three years, four years,
21     but I think we are pushing it if we wait much longer
22     than that to get our act together after the Americans
23     light up.
24  4416                 COMMISSIONER McKENDRY:  That leaves
25     me a question that I wanted to ask about consumers and


 1     the new digital TV sets.  In the written submission at
 2     paragraph 11, you said and I quote:
 3                            "Spectrum auctions and the hope
 4                            of more money for the US
 5                            Treasury, along with the dream
 6                            of better TV pictures and a
 7                            renewed manufacturing/retail
 8                            sector is fuelling the American
 9                            roll out."
10  4417                 The only part of this fuel, it seems
11     to me, that is relevant to consumers is the dream of
12     better TV pictures.  Unlike the U.S. Treasury and the
13     consumer products industry, we are going to get more
14     money out of this.
15  4418                 Consumers are going to have less
16     money out of this, but presumably the hope is that they
17     will see great value in a digital TV set, a better
18     picture, and that it will be worth having less money in
19     order to get this better picture.
20  4419                 My question to you is, and you have
21     made some comments about that, what evidence exists
22     that a significant number of consumers are prepared to
23     buy a new TV set for a better picture?
24  4420                 MR. McEWEN:  Let me give you, and
25     this is more anecdotal because we need to do, and


 1     that's one of the things that we are going to do, some
 2     market research and some survey work over the coming
 3     year.
 4  4421                 The biggest growth in television has
 5     been at the high end, the home entertainment set. 
 6     These are sets now that are in the $4,000 to $5,000
 7     range.  The market share has really grown.  I think
 8     it's now 15 to 20 per cent of all televisions sold are
 9     that high end.
10  4422                 If you look at that, what do they
11     want?  They want better sound, better pictures and as
12     much flexibility as those equipment sets give them. 
13     That will be the initial target, 60 inches, good sound
14     and that's the market initially that people will go
15     after.
16  4423                 For example, one of the Toshiba
17     models is a 60 inch -- just a monitor.  It's capable of
18     taking both an analog signal and then line doubling to
19     go 1080-I full high definition interlaced with a
20     digital box to be added later. Some manufacturers are
21     putting a strategy in place.
22  4424                 The next step is to bring that set
23     down to 36 inches wide screen and maybe release it for,
24     as Jim said, $1,500 or $999 maybe in a year and a half. 
25     As those pictures come out and as the high end


 1     consumers take the initial shock of the dollar, because
 2     they are already spending it, the sets will get
 3     cheaper.
 4  4425                 It will also be fuelled by, I
 5     believe, DVDs.  Last year I think in this country, and
 6     that would have to be confirmed by the Retail
 7     Association, but I think there was about 25,000 or
 8     30,000 DVDs sold in Canada.  This year they are up well
 9     over 200,000.
10  4426                 A DVD wide screen picture, just at
11     standard resolution, is absolutely fabulous.  When you
12     go to full high definition, it's a remarkable
13     experience.
14  4427                 Some anecdotal evidence.  We will
15     have harder evidence which we will be glad to share
16     with you when we do the market surveys we are planning
17     to do and some of the focus work, but our sense of it
18     is, and certainly the manufacturers' and the retail
19     sense is, it's a product i.e. if the program services
20     are there, the television sets will be there and they
21     will be picked up quickly.
22  4428                 COMMISSIONER McKENDRY:  You mentioned
23     the close relationship between broadcasters and the
24     cable industry in Canada in terms of delivering your
25     signals into households.


 1  4429                 What about the scenario that in a DTV
 2     world you might not need cable just as much as you need
 3     them now?  You could broadcast over the air as you do
 4     today your DTV signal which, I understand, can be
 5     received by either rabbit ears or the ordinary roof-top
 6     antenna.
 7  4430                 Presumably you can transmit a lot
 8     more signals as well as your conventional over the free
 9     signal.  I assume you could transmit TSN if you wanted
10     to and TSN wanted you to.
11  4431                 Will you become a competitor to cable
12     systems in the DTV world?  Will it make you less
13     dependent on cable?
14  4432                 MR. McEWEN:  Well, perhaps I could
15     answer by suggesting that when spectrum is made
16     available to a broadcaster, as they have in the United
17     States, six megahertz of spectrum for a digital signal,
18     if you want to go full high definition, you have to use
19     almost all of that six megahertz.  In other words, you
20     can't get another signal in there.
21  4433                 If you don't want to go full high
22     definition and you decide just to stay on standard
23     resolution, you could probably get four or five signals
24     out.
25  4434                 At present what we have said in


 1     Canada is that spectrum made available for broadcasters
 2     should be used to bring the best possible picture to
 3     the viewer.  That's full high definition.  We won't be
 4     full high definition on day one, but eventually that's
 5     the goal, to have some day parts of the schedule in
 6     full high definition.
 7  4435                 If the marketplace, and that's why we
 8     have to monitor very carefully what's going on in the
 9     United States, if the marketplace really doesn't have
10     an appetite for full high definition, then it may
11     change the nature of how we would want to use that
12     spectrum, but then that also becomes a public policy
13     issue as well.
14  4436                 COMMISSIONER McKENDRY:  I understand
15     in the U.S. the FCC has been quite clear that they
16     expect or anticipate that over-the-air broadcasters
17     will provide subscription services, data services and
18     so on.
19  4437                 The Canadian Association of
20     Broadcasters, when they appeared, talked about the
21     convergence of the Internet and the television set and
22     the computer, I suppose, and the television set and
23     that would be an opportunity for broadcasters.  That's
24     what's leading me to my question.
25  4438                 Will you be able to wean yourself


 1     from cable by becoming in effect carriers of more
 2     signals, broadcasting them into the air into people's
 3     homes on a subscription basis?
 4  4439                 MR. McEWEN:  I think we should
 5     understand that, you know, you can run -- let me back
 6     up and say that the FCC has contemplated some parts of
 7     the day being able to be carried multiple signals, but
 8     Congress and the Chair of the Communications Group in
 9     Congress has made it very clear that they expect
10     broadcasters to use the full spectrum to bring high
11     definition to viewers and that if the broadcasters
12     aren't prepared to do that, then Congress better have
13     another look at how much spectrum they have been given.
14  4440                 Having said that, with a full high
15     definition signal you can still bring a lot of data
16     into Internet and multimedia services with it.  There's
17     still that capacity, but there's not enough capacity
18     with full high definition to bring, you know, another
19     television signal.
20  4441                 COMMISSIONER McKENDRY:  One of the
21     current issues for us and for others is the limited
22     capacity on cable systems in relationship to the
23     demands that are being placed on the cable system for
24     carriage.
25  4442                 When digital arrives here in Canada,


 1     I am assuming that there will be dual carriage of
 2     signals or you would like dual carriage of signals for
 3     some sort of transition period so that the over-the-air
 4     broadcaster will have the conventional analog signal
 5     coming over the cable and would also like a channel for
 6     the digital signal, in effect doubling the space
 7     required.  Is that right?
 8                                                        0935
 9  4443                 MR. McEWEN:  Well, that's certainly
10     what we are talking about and that's certainly the goal
11     and that's one of the issues that we are trying to work
12     on inside, to see how that can happen.
13  4444                 But, yes -- I mean look at the
14     situation in Vancouver, BCTV, and which you had WIC up
15     yesterday.  My understanding is that 93 or 94 per cent
16     of their audience is delivered by cable.  So, for them
17     to light up a transmitter in Vancouver that does not
18     have that signal duplicated on cable is frankly not
19     delivering any product to anybody and it is very
20     difficult to get viewers to move from one delivery
21     medium to another.
22  4445                 I think we have to be realistic about
23     that and so our goal as a group is to have the
24     broadcasters and the cable distributors and the
25     satellite distributors work out a co-ordinated roll-out


 1     that there may be some compromises in that roll-out
 2     because of capacity problems or whatever, but to work
 3     it out in a way that works best for the delivery of the
 4     signal and best for the viewer and tries not to disrupt
 5     the viewers' patterns because that's a very
 6     challenging, challenging situation.
 7  4446                 COMMISSIONER McKENDRY:  If we are
 8     talking about a two year roll-out or a roll-out within
 9     two years of digital TV in Canada, at least we hope or
10     you hope to see that happen, I understand that the
11     digital set top box, the second generation is probably
12     a couple of years away too, the impression I get from
13     reading literature and so on.  And as I understand, I
14     think it was in your submission that the cable industry
15     is looking at a billion dollar upgrade to their
16     network.  Are we going to be in the position of having
17     to decide who gets bumped to carry duplicate signals?
18  4447                 MR. McEWEN:  Well, you know the
19     debate in the United States and we are hoping to avoid
20     that debate in Canada by coming up with an industry
21     solution.
22  4448                 Obviously, if the industry can't
23     provide a solution itself it may fall into somebody
24     else's lap and it could be yours.
25  4449                 MR. SWARD:  I think, Commissioner


 1     McKendry, that it is not a two year roll-out.  It is
 2     sort of two years until the gun goes off and the sound
 3     of the gun is the broadcaster being the first link in
 4     the chain investing their capital because nothing can
 5     happen until the broadcaster transmits a high-
 6     definition signal.
 7  4450                 When that happens cable can receive
 8     it.  If they are ready to go they can put it through
 9     and the consumer can receive it.  It's the broadcaster
10     that has to put the money on the table.  We think the
11     first money will go on the table in the next couple of
12     years.
13  4451                 So, over a period of time it will
14     probably cost the broadcasters, maybe the following two
15     years, the better part of $400 million or $500 million
16     is our guestimate right now for all of us, including
17     CBC, to do it.
18  4452                 We want a deal with cable because we
19     are so dependent on them, but they first have to get on
20     the platform of bits and bites themselves.  They have
21     got to get on ones and zeroes and the $800 million that
22     we are talking about in this presentation is
23     incremental to the change that is already under way to
24     digital.
25  4453                 However, when they get a digital


 1     plant in place that they have an enormous bump up in
 2     their capacity and we should be able to co-ordinate say
 3     a five to seven-year transition plan, where the
 4     conventional broadcasters broadcast dual analog over
 5     cable and dual -- two channels, one for each -- or two
 6     for each service.  By the time we can start to shut
 7     down analog and turn those channels back over to the
 8     cable industry, that will be another generation, but I
 9     am sure there will be lots more ideas at that time for
10     Canadian enterprise ideas on how to fill those channels
11     up, but they first have to make their step to digital.
12  4454                 COMMISSIONER McKENDRY:  If the gun
13     goes off in two years are you -- I don't know how quite
14     to frame this question properly, but what I would like
15     to know, if you have it, is an estimate of how many
16     viewers in Canada you expect will turn their TV sets
17     towards the U.S. for digital signals.  In your mind
18     will there be a significant shift of Canadian viewers
19     to American over-the-air stations in the next two
20     years?
21  4455                 MR. McEWEN:  Not significant -- well,
22     it depends on what you call significant.  I mean is
23     200,000 to 300,000 grey markets significant for DTH.
24  4456                 Detroit will be on the air and that
25     will take in Windsor, probably up to Chatham, in that


 1     area.  Seattle will be on the air and that beamed
 2     straight across to Victoria on Vancouver Island and
 3     will get probably North and West Van, up the side of
 4     the mountain in Vancouver.
 5  4457                 There is discussion that Buffalo may
 6     go on the air sometime towards the end of next year and
 7     that would bring a signal into Toronto and depending on 
 8     which stations go, either all of the GTA is covered or
 9     parts of it and, of course, then down the lake towards
10     the border with Buffalo.  That's the potential
11     audience.
12  4458                 Now, how many within that audience
13     without our own digital signals and what not on the air
14     will have those television sets within a couple of
15     years, maybe 50,000, maybe 100,000.
16  4459                 The danger is that if you fall
17     farther behind than that, the acceleration in this area
18     I think is going to be very quickly developed.  You are
19     going to see kind of a take-off rate that will just go
20     like that.  We would like to be at that start of the
21     curve, not that start.
22  4460                 As one of our members said in a
23     committee meeting when we were preparing our business
24     plans, a grey market of 200,000 or 300,000 was probably
25     a mistake.  A grey market of 3 million or 4 million is


 1     a disaster and that's what we would worry about if we
 2     were not positioned properly.
 3  4461                 COMMISSIONER McKENDRY:  Am I right
 4     that in the United States digital TV in the early days
 5     isn't just commercial broadcasters.  I understand some
 6     PBS stations are converting now or will be shortly.
 7  4462                 MR. McEWEN:  Yes.  Out of the five
 8     that -- what are the figures -- 28 and 17 in November,
 9     so that's 45 stations that will be on the air in
10     November and out of the 45 I believe five are PBS
11     stations.
12  4463                 COMMISSIONER McKENDRY:  As a final
13     question, coming out of this policy review that we are
14     undertaking what would you like to see in our decision
15     from your perspective?
16  4464                 MR. McEWEN:  I would like, and I
17     think the industry would like to see the Commission be
18     sensitive to the issues of the transition, the costs,
19     the challenges and the opportunities and be proactive
20     about working with the industry to create the
21     regulatory framework that is going to be required to
22     roll it out.
23  4465                 COMMISSIONER McKENDRY:  When you say
24     you would like us to be sensitive what does that
25     mean -- sensitive to the costs?


 1  4466                 MR. McEWEN:  Aware of the costs.  I
 2     mean there is a massive amount of investment that is
 3     going to be put in here with initially no other revenue
 4     opportunities.
 5  4467                 COMMISSIONER McKENDRY:  Does that
 6     mean we should go easy in terms of asking for more
 7     expenditures on Canadian content because of the
 8     expenditures on digital?  Is that what sensitive means?
 9  4468                 MR. SWARD:  Yes.
10  4469                 MR. McEWEN:  Yes, I think so.
11  4470                 I always like to hear the Chair say
12     that.
13  4471                 COMMISSIONER McKENDRY:  Thank you.
14  4472                 Those are my questions, Madam Chair.
15  4473                 THE CHAIRPERSON:  Commissioner
16     Pennefather.
17  4474                 COMMISSIONER PENNEFATHER:  Thank you.
18  4475                 Good morning.
19  4476                 MR. McEWEN:  Good morning.
20  4477                 COMMISSIONER PENNEFATHER:  In effect,
21     I would like to go back to this question of Canadian
22     content.  I am pleased that you raised the issue of
23     programming in your paper this morning.  I would just
24     like to be clear on what you mean by the market will be
25     even more dominated than it is by American program


 1     sources.
 2  4478                 I am assuming, and correct me if I am
 3     wrong, is folly, and forgive me if this is too
 4     simplistic, at some point in time Canadian viewers will
 5     have the sets and they will be watching American
 6     signals.  Maybe some Canadian producers have had the
 7     courage to move forward and their programs will be part
 8     of that menu.
 9  4479                 However, unless we move, you are
10     saying they will not be watching Canadian television in
11     digital.  Let's assume they are watching Canadian
12     television in digital.  Will they be watching any
13     Canadian programs in digital or will they be watching
14     American programs because, as you point out, the supply
15     at least at first is plentiful because of 35 millimetre
16     programming, et cetera.  Could you take me forward on
17     that and just get the timing clear and what you feel we
18     should do in that effect?
19                                                        0945
20  4480                 MR. McEWEN:  Thank you for your
21     question, because I think it is fundamental, and
22     perhaps in the kinds of issues that you are dealing
23     with in this policy hearing it is perhaps the most
24     fundamental issue of all.
25  4481                 Our libraries are basically not 35-


 1     millimetre.  the NFB has some 35-millimetre, the CBC
 2     has and some of the large independent producers have
 3     some 35-millimetre product, but most of our libraries
 4     are less than super 16 and they just don't convert to
 5     wide screen digital.  So any product that is there
 6     probably in our libraries, less than 10 per cent is
 7     convertible to wide screen digital.
 8  4482                 That may change with technology
 9     changes, but that's the way it is right now, whereas
10     probably in the United States 90 per cent of what they
11     have produced over the last 10, 20 years can be
12     converted to wide screen digital television.  So you
13     can think about strip programs, whatever, just go back
14     in there and they can convert and market during the
15     transition as product available and ready for wide
16     screen digital television.
17  4483                 Now, in Canada, my own view is -- and
18     this is my own view after a lot of discussion with
19     others -- some of our big players have the capacity to
20     start producing now.  Some, like Linda, have been quite
21     courageous, but it was done as an experiment, with a
22     lot of support from Sony and the CBC and others in that
23     project.
24  4484                 There is not systematic production
25     taking place in Canada of wide screen digital product,


 1     or even 35-millimetre convertible product.  Most of our
 2     medium and small independent producers are not
 3     producing in that.  Therefore, we have a product lag;
 4     we just don't have anything on the shelf that we can
 5     convert and put on the air.
 6  4485                 So what we are suggesting is that
 7     producers should be producing now and down-converting
 8     back to analog; in other words, producing in digital or
 9     35-millimetre and down-converting back to analog.  It
10     is a little more expensive, but they have product on
11     the shelf, and in the long term they are going to get
12     more revenue from it.  But that has to be part of an
13     industry strategy.
14  4486                 COMMISSIONER PENNEFATHER:  Indeed,
15     and I assume then you mean that continuing the
16     preparation of Canadian product for this new digital
17     era should also be part of our regulatory framework and
18     part of the broadcasters' responsibilities as well.
19  4487                 MR. SWARD:  Commissioner Pennefather,
20     at the task force level, an important component of that
21     was representatives of the independent producers and
22     filmmakers, and one of City-tv's tasks or missions is
23     to get information.  The big players know what is going
24     on and are sort of on top of it, but there is a lot of
25     smaller producers that really don't have a handle on


 1     what this means to them and how to get there.
 2  4488                 The first green light we need to get,
 3     as Michael said, is from the Minister of Heritage,
 4     because there is a fully developed plan sitting on the
 5     desk over there that I understand has been very well
 6     received; we just don't have the green light on it. 
 7     Part of that plan is a whole preparedness program to
 8     assist the production industry in getting into this
 9     mode.
10  4489                 If we can get going, I don't think we
11     are going to have any trouble with our Canadian product
12     standing up -- the new stuff, the new product, the
13     fresh episodes, the new ones.  We do have some library
14     issues, and that's going to affect broadcasters and
15     others to go back into old repertoire, who use that as
16     a programming instrument.  But the fresh stuff, the new
17     stuff, should be there if we put this plan in and we
18     put it in the way it is tabled right now.
19  4490                 COMMISSIONER PENNEFATHER:  I agree, I
20     do hope so, and I hope, as Mr. McEwen said, that this
21     is an opportunity for Canadian television, not just a
22     challenge, which must be supported through the
23     government, but that you will move forward and prepare
24     this country for some of the best digital programming
25     in the world, because I think we have to remember this


 1     is also not just an issue of Canada and the United
 2     States, this is an issue of world programming and our
 3     capacity to meet that demand and to present the quality
 4     we are capable of.
 5  4491                 I think this is an area we should
 6     keep top of mind; as Commissioner McKendry put it, it
 7     is more than just a pretty picture that will make
 8     Canadians interested.  If all our surveys and
 9     everything else prove that Canadians will watch
10     Canadian programming, then they will watch digital
11     programming, but the quality has to be there and it is
12     more than just a pretty picture.
13  4492                 MR. McEWEN:  May I just follow on
14     that point, Commissioner?  A little vision for you.
15  4493                 The CBC, as you are probably aware,
16     are shooting People's History of Canada, and they are
17     shooting it in, I understand, both analog and wide
18     screen digital because they see it as a library for
19     future generations.  With it they are also doing a
20     number of multimedia-related things -- CD Roms, they
21     are publishing diaries, research material on the
22     Internet, on their website and whatnot, which I think
23     is a great idea because it becomes a real teaching
24     tool, whether you are doing the expulsion of the
25     Acadians or the settling of the west or the rebellion


 1     or whatever, and it will be a tremendous resource for
 2     our children.
 3  4494                 But what really interests me is, ten
 4     years from now that program is going to be on the air
 5     in wide screen and we are going to have the capacity to
 6     download that material, that reference material, off
 7     the television into the home while the program is on
 8     the air, or scrolling the bottom of it, or finding out
 9     where you can get the CD for the Acadian music of the
10     period, or maybe even downloading the music for a fee.
11  4495                 My point is that it is going to
12     change over the next generation how people use
13     television, and there will be a degree of convergence
14     there.  That's the opportunity for Canadian
15     programmers, if they start thinking about that, down
16     that road, and starting to build product that lends
17     itself to that kind of experience.
18  4496                 COMMISSIONER PENNEFATHER:  Just one
19     final comment.  I think you were both here yesterday
20     when Mr. Stark was with us, and he as well mentioned
21     the digital world may also provide greater
22     opportunities for access to information and to all
23     kinds of media.
24  4497                 So I would hope in your planning, in
25     the industry framework that you are putting together,


 1     you would consider those opportunities as well for the
 2     disabled and for all citizens of this country to have
 3     access to the information coming through these
 4     beautiful systems.
 5  4498                 MR. McEWEN:  Of course. Thank you.
 6  4499                 THE CHAIRPERSON:  Thank you.
 7  4500                 Commissioner Cardozo.
 8  4501                 COMMISSIONER CARDOZO:  I just want to
 9     carry on a couple of issues that have been raised by
10     Commissioner McKendry and Commissioner Pennefather.
11  4502                 I am still not clear why you need
12     government and the CRTC to be making the kinds of
13     statements you are looking for if you have the economic
14     and the compelling case, unless it is that you need
15     financial support from government, direct or
16     indirect -- and I guess you have now indicated that you
17     do need the issue of the Canadian content; that has
18     been hinted at in other presentations and I think that
19     has come out clearly.
20  4503                 MR. McEWEN:  First of all, as a
21     reference -- and I don't know whether you have seen it,
22     but the task force report is fairly explicit in laying
23     out the reasons why -- I mean, the Minister actually
24     commissioned the task force to come up with a set of
25     recommendations to advise government about what action


 1     should be taken.  That was the Minister's own
 2     initiative.
 3  4504                 The industry responded to that
 4     initiative by coming up with a task force report with a
 5     number of recommendations.  It would be the industry's
 6     expectation that it would be responded to.  That's
 7     point No. 1.  And in there you will see for example
 8     production recommendations and our concern about
 9     producing product and how we think that we can
10     stimulate that, and there are some other issues in
11     there like that.
12  4505                 I want to kind of broaden the thought
13     out.  Some of you may be aware that I also work in the
14     digital radio side.  I am working with an international
15     group called the World Digital Audio Broadcast Forum,
16     and I had the opportunity of chairing a panel in
17     Amsterdam about 10 days ago.
18                                                        0955
19  4506                 Part of the discussion focused on the
20     roll-out of new technologies and how can you be
21     successful in rolling out new technologies when it's
22     replacing something as ubiquitous as analog radio or
23     you could put analog television, because it's a real
24     challenge.  The ingredients that panellists from the
25     United Kingdom, Germany, France and the United States


 1     indicated were the following, and I buy this argument.
 2  4507                 There is a commitment from the
 3     country through a proper policy and regulatory
 4     framework that the service-providers then will provide
 5     the services, the program producers will program and
 6     the manufacturers will be there with the equipment. 
 7     It's in that kind of order.  Any successful transition
 8     will have those ingredients to it.
 9  4508                 I look to the United Kingdom in both
10     radio and television.  They have just announced the
11     launch -- the commercial and public broadcasters have
12     launched digital radio.  They have 70 per cent of the
13     country covered with transmitters, government has fully
14     endorsed it, and they are rolling out digital
15     television.  Again government endorsed a plan, made
16     spectrum available, they built out the country to 90
17     per cent and they are launching in six months.
18  4509                 Other countries have not done so well
19     because they haven't had the general kind of policy and
20     regulatory framework.  Germany were digital radio
21     technology and in the case of television digital video
22     broadcasting and terrestrial technology was developed. 
23     It's a mess because they don't have a coordinated
24     policy or regulatory framework.  Now they are starting
25     to get their act together.  So, the ingredients are


 1     policy and regulation.  The broadcasters are there
 2     broadcasting those services, program-makers are making
 3     the programs and the manufacturers are there.  Those
 4     are the elements.
 5  4510                 COMMISSIONER CARDOZO:  One other
 6     question in terms of the different parts of this whole
 7     deal, and this is obviously a naive question.  Is it
 8     possible that, say, five or ten years down the road we
 9     will have parts of this and not others?  I am thinking
10     digital in terms of capacity because we need more
11     capacity.  There is demand for that, but perhaps not
12     the wide screen part of things.  Is it possible that
13     for cost reasons or whatever, we go with part of the
14     package and not the other or is it just going to
15     happen, period, and we should stop questioning it?
16  4511                 MR. McEWEN:  No, it's a fair point. 
17     I think a lot of it will depend on the success of the
18     roll-out in the United States to the degree that we go
19     fully wide screen digital high definition.  We will
20     have to watch that and be very mindful of it.
21  4512                 In Europe, they are taking a
22     different course.  Some of their services will be wide
23     screen and others will be in 4 by 3.  The problem is
24     you create a letterbox format and I'm not sure that in
25     the long run that's a very good strategy.  My own view


 1     is that in ten years it will all be wide screen.
 2  4513                 COMMISSIONER CARDOZO:  You would like
 3     to see it that way, but is it possible?
 4  4514                 MR. McEWEN:  It's always a
 5     possibility.  In the end, the marketplace will decide. 
 6     But when you see the take-up of DVDs the way they are
 7     coming into the market and you see a DVD picture on a
 8     wide screen television as opposed to a 4 by 3, why
 9     would you ever do that?  Why would you stay with 4 by
10     3?  Gradually you would start to replace your
11     televisions and that will happen over a 10 to 15-year
12     time frame.  Maybe the next new television that the
13     family would get a year or two from now would be wide
14     screen, but they would still have two or three others. 
15     I think the average home has two televisions now.
16  4515                 MR. SWARD:  But you are right,
17     Commissioner Cardozo, that it may not be a wide screen
18     TV in everybody's home.  I'm not sure everybody has
19     rooms big enough for those big wide screen TVs to get
20     back far enough to be able to watch it on the big ones
21     and when they get down small, the value of the
22     definition may start to dissipate.
23  4516                 COMMISSIONER CARDOZO:  Thanks.  I
24     wish you had told me this six months ago.  I just moved
25     into a new house over the summer.


 1  4517                 MR. SWARD:  Did you buy a screening
 2     room with the house?  You will need a screening room, a
 3     big basement.
 4  4518                 COMMISSIONER CARDOZO:  In good time,
 5     I guess.
 6  4519                 MR. SWARD:  Where we have positioned
 7     Canada in this regard is on what I will call a fast-
 8     following strategy.  We are not the gung ho
 9     cheerleaders on this technology.  It doesn't mean we
10     don't want to go there, it's just that our resources
11     are limited enough that we can only afford to up the
12     money on the table once and to get it right.  We can't
13     afford any crashes along the way or a couple of billion
14     dollars tracked down after the wrong strategy.
15  4520                 So, we have effectively tried to
16     organize all the components and said to our government,
17     "Here is the policy that we need and this is a fast
18     following."  It's designed to just sit in the
19     slipstream enough and say, "Okay, that works", boom,
20     and get us there and count on the lag on the consumer
21     front to be able to give us the flexibility to do it.
22  4521                 But this is going to land in your
23     lap; not right away, but this is going to land in your
24     lap if we do go ahead on things, like the issue of what
25     the broadcasters do with the second channel.  Is it


 1     just a full redo or is it just a complete repeat or can
 2     they try some different stuff on it?  Folks will have a
 3     lot to say about that, pro and con.  So, the whole
 4     governance of this policy will make your world once
 5     again and ours more complex and more interesting, with
 6     a lot more opportunity.
 7  4522                 COMMISSIONER CARDOZO:  Thanks.
 8  4523                 Thanks, Madam Chair.
 9  4524                 MR. McEWEN:  By the way, just one
10     point on wide screen.  Europe introduced wide screen
11     about a year and a half ago, as I understand, and the
12     take-up rate in France -- half the television sets sold
13     in France this past year have been wide screen.  They
14     are not 60-inch wide screens, we are talking 30 to 36-
15     inch wide screen.  So, that's an interesting
16     observation.  I don't know, it may be an indication.
17  4525                 THE CHAIRPERSON:  But that would only
18     be helpful if we knew how many new television sets were
19     sold.
20  4526                 MR. McEWEN:  We could find out,
21     but --
22  4527                 THE CHAIRPERSON:  Because it's the
23     replacement that becomes a problem.  To say half of the
24     television sets sold in a year is only relevant if you
25     can also tell me what the proportion of that is to the


 1     total number of television sets in France.
 2  4528                 MR. McEWEN:  I don't know what the
 3     market is in France.
 4  4529                 THE CHAIRPERSON:  Wouldn't you agree,
 5     though?
 6  4530                 MR. McEWEN:  Yes.
 7  4531                 THE CHAIRPERSON:  Because presumably
 8     you could have sold 100 and 50 of them wide screen.
 9  4532                 MR. McEWEN:  Well, they probably sell
10     about a million television sets.
11  4533                 THE CHAIRPERSON:  I am being
12     facetious.
13  4534                 MR. McEWEN:  A fair point.
14  4535                 MR. SWARD:  Vice-Chair, there are no
15     standards that we can apply to this.  It took 30 years
16     to get a million Canadians to get a telephone in their
17     home and it took 13 years for a million Canadians to
18     sign up for cable.  These bags under my eyes are a
19     testimonial to my brief stint in the cellular telephone
20     business where it took 18 months for a million
21     Canadians to acquire cellular telephones.
22  4536                 We have seen technologies be
23     introduced at such varying different rates.  If one of
24     these wide screens lands on my street in my
25     neighbourhood and it is enough of a change, as much as


 1     colour was a change from black and white, if it's
 2     enough of a change, whoosh, it will go like wildfire up
 3     and down the block.  If it's not, it will remain the
 4     toy of the wealthy or those kinds of things.
 5  4537                 We don't have those answers yet, but
 6     there is a -- the TV that is downstairs in our rec room
 7     is 20 years old and it still works.  That won't get
 8     changed until it breaks or there is a new alternative. 
 9     You won't be able to take the analog trade-out and the
10     average of a television -- we did this, didn't we, in a
11     committee?
12  4538                 MR. McEWEN:  Yes.
13  4539                 MR. SWARD:  The average life of a
14     television set -- it really hasn't changed a lot in the
15     last 20 years -- is the better part of 12 years.
16  4540                 MR. McEWEN:  That's right.
17  4541                 MR. SWARD:  So, there is quite a long
18     life.  So, you think it will take 12 years to swap out
19     to the new technology.  It won't go that way.  It could
20     catch fire and be all over in three or four years. 
21     That's what the American plan counts on because they
22     really are seemingly quite serious about turning analog
23     black.  That means all of those analog sets won't work
24     in 2006 in the United States.  That depends on who
25     wants votes and what the circumstances are at the time.


 1  4542                 THE CHAIRPERSON:  Commissioner
 2     McKendry?
 3  4543                 COMMISSIONER McKENDRY:  I just had a
 4     follow-up question on a matter I guess I had raised
 5     with you and then Commissioner Cardozo brought it up
 6     again.  The report you are referring to, I think, is
 7     the report of the government, the Digital Era Report. 
 8     I am getting the impression you are saying:  We can't
 9     move until we get a response.  You have moved on a
10     couple of things in here, I think.  For example, the
11     organization that you are heading up was one of the
12     recommendations.  Some of the standard stuff, I think,
13     has moved ahead or is moving ahead.
14  4544                 What specific recommendations are you
15     actually waiting for?  Is it the one that says that the
16     government should provide an additional $50 million
17     annually?
18  4545                 MR. McEWEN:  We would certainly like
19     to hear about that one for the production community. 
20     Jim referred to that.  That was the recommendation. 
21     Whether it's $50 million or whether it's additional
22     incentives for producing in digital or whatever, but
23     something to prime the pump and get things going there,
24     yes, we would like to hear on that.
25  4546                 We would like to hear from the


 1     government that they actually agree that we should move
 2     from analog to digital, which is the whole philosophy
 3     of the report.  We would also like to make sure that
 4     broadcasters have access to licences for a simulcast
 5     period.  We would like to understand and work in some
 6     kind of overall transition strategy.
 7  4547                 There is 17 recommendations.  I think
 8     about ten of them are strategic and about seven of them
 9     are implementation recommendations.  We would like to
10     hear back from government, from a task force that it
11     commissioned, to get the best advice it could from the
12     industry, what they think about that.
13  4548                 COMMISSIONER McKENDRY:  Are you
14     saying that the federal government is holding up the
15     evolution of digital television in Canada by not
16     responding to this report?
17  4549                 MR. McEWEN:  No, I'm just saying we
18     haven't heard from them yet.
19  4550                 MR. SWARD:  Commissioner McKendry, we
20     are moving this forward and we are going to continue to
21     move it forward.  It would be nice to have and at one
22     point or another it's important that they set the
23     policy because, as I say, this is going to move into
24     your area when people start coming forward with these
25     things that are a by-product of this transition,


 1     whether it's the use of another channel or those kinds
 2     of things.
 3  4551                 But I don't think there is any doubt
 4     that to the degree -- I don't think there is any doubt
 5     that there is going to be an endorsement for that
 6     policy or a policy that is very similar to that.  I
 7     think it's just a matter of time, isn't it, Michael?
 8  4552                 MR. McEWEN:  Yes.  My view is that we
 9     should probably hear from them within the next couple
10     of months.  There has been a lot of work done.
11  4553                 MR. SWARD:  We have got wheels under
12     this and we are moving it because we have to as an
13     industry between broadcasters and cable and the
14     production community and the consumer products group.
15  4554                 COMMISSIONER McKENDRY:  Thank you
16     very much.
17  4555                 Thank you, Madam Chair.
18  4556                 THE CHAIRPERSON:  You are now, of
19     course, appearing before the broadcast regulator and I
20     think it's fair for us to be aware of what's going on,
21     but also to see what our role is.  From the
22     conversation this morning, I would see a number of
23     groups involved in this.  As Ms Schuyler has pointed
24     out, there may be an advantage to the producer if it's
25     large enough to go ahead and produce in digital,


 1     anyway, because it can sell where digital is already
 2     occurring.
 3  4557                 We have the broadcasters who say they
 4     will have to spend a lot of money, so we should be very
 5     conscious of that when we regulate, and then we have
 6     the cable industry on which the broadcasters are very
 7     dependent in Canada.  My suspicion is the broadcasters
 8     are not going to spend a whole lot of money on this
 9     until the cable operators are in the game, too.
10  4558                 MR. SWARD:  You are absolutely right.
11  4559                 THE CHAIRPERSON:  Then you have the
12     consumer at the end, who has to see a price for the TV
13     set that seems to be warranted according to what
14     quality he is getting, which, in turn, requires very
15     high definition.  You have mentioned black and white. 
16     I often tell the story of how, when I brought up my
17     children, we still had a black and white TV and the
18     peacock would come on the screen and the kids would run
19     into the kitchen and say, "Mommy, Mommy, this is so
20     neat.  This one is going to be in colour.  They just
21     said this would be living colour."
22  4560                 So, if there isn't sufficient
23     difference, even if your screen is house-trained, and
24     then if the cable operators are not -- my children may
25     have been, albeit, a bit slow.  Then if the consumer


 1     has to spend $7,000 on a set at the beginning and all
 2     he can do is somehow capture the over-the-air signals
 3     depending on where you live, he is hardly going to do
 4     that.  I suspect that's what you mean by the grey
 5     market.  They are certainly not going to do it in
 6     Sudbury if the cable operators are not in the game.
 7  4561                 If the broadcasters are telling us
 8     today that one of the ways we could help is by reducing
 9     our requirement on Canadian content, I don't see how
10     that helps the producers get into the digital game
11     because they are here telling us that they have to have
12     the broadcasters give them more shelf and more money
13     and more exhibition and so on.  So, it's a chain that
14     makes me ask myself to what extent in this particular
15     context, this particular hearing, do we regulate by
16     reference to changes in technology that may or may not
17     come in the chain the proper time.
18  4562                 We have had a recent history of doing
19     that, of saying, "You have to diminish your demands
20     here because we have to do this, which will be better
21     for the system in the end."  So, it seems to me in this
22     chain that our responsibility is to look at it from the
23     perspective that we are charged with, which is
24     regulation.  I suspect what I heard this morning is: 
25     Don't ask as much content from us because we are going


 1     to spend a lot on technology.
 2  4563                 MR. SWARD:  I was trying to offer a
 3     brief answer for a change when I said "yes".  This is
 4     just one of the many inputs, Vice-Chair, that you will
 5     receive throughout this three or four weeks about the
 6     environment that you are regulating into.  It's
 7     important to us and to our board that this be an input
 8     that you have, that when you sit down and say, "Okay,
 9     what are we going to do here, we have all of these
10     different ideas", that when you make those decisions
11     you have an understanding of what the industry is
12     facing, what they have ahead of them, and that you have
13     some kind of an idea of their capacity.
14  4564                 Is conventional television the
15     smokestack sector or the communications industry?  Is
16     it the AM radio of television with all of the new
17     alternatives, especially specialty?  Those are
18     decisions that you are going to have to make and all we
19     are trying to do with this and other folks that are
20     here on these environmental issues is more or less give
21     you as much information as you are interested in
22     receiving about what lies ahead for the industry and
23     then, on that basis, we are hopeful that you will take
24     those factors into consideration as you decide how you
25     are going to change it.


 1  4565                 There is lots of change going on
 2     around us and change in regulation is another change
 3     for us to deal with.  So, if you decide at this point
 4     it's time to move the platform a bit in that area,
 5     that's fine.  We just want to ensure that you
 6     understand the context and the environment that you are
 7     doing that in.
 8  4566                 THE CHAIRPERSON:  We are grateful for
 9     your appearance, Mr. McEwen, so early on Saturday
10     morning.  Of course, the more we know, the better
11     decision we are likely to be able to make in the
12     reference framework that informs our decision.
13  4567                 MR. McEWEN:  Thank you very much.
14  4568                 THE CHAIRPERSON:  Thank you to both
15     of you.
16  4569                 MR. SWARD:  Thank you for allowing me
17     this rude intrusion.
18  4570                 THE CHAIRPERSON:  The more the
19     merrier.  We need to be kept informed.  Thank you very
20     much.
21  4571                 Madam Secretary, would you call the
22     next presenter, please?
23  4572                 MS BÉNARD:  Thank you, Madam Chair. 
24     The next presentation will be by the Canadian
25     Independent Film and Video Fund and I would invite them


 1     to please come forward.
 2  4573                 THE CHAIRPERSON:  Good morning, Madam
 3     and sir.  Go ahead when you are ready.
 5  4574                 MS JACKSON:  Thank you, Madam Chair,
 6     good morning.  Good morning, Commissioners and CRTC
 7     staff.  My name is Robin Jackson.  I am the Executive
 8     Director of the Canadian Independent Film and Video
 9     Fund, also known as the CIFVF.  With me today is
10     Richard Elson, Treasurer of the CIFVF and an
11     independent producer from Montreal and President of the
12     company Imageries.
13  4575                 The Canadian Independent Film and
14     Video Fund is a private sector, non-profit organization
15     dedicated to supporting the development of the non-
16     theatrical industry through the creation of films,
17     videos and new media projects which promote lifelong
18     learning and are produced by Canadian independent
19     producers.  In addition, we administer the Stentor New
20     Media Fund and the Fundy Communications Production
21     Fund.
22                                                        1015
23  4576                 The CIFVF has made a number of
24     submissions to the CRTC over the years, specifically in
25     response to P.N. 1993-105 on the structure and mandate


 1     of the proposed Production Fund for Canadian
 2     Programming; Public Notice 1993-137 and 74 and 1994-10
 3     regarding the creation of the Cable Production Fund;
 4     Public Notice 1996-69 concerning the regulation of
 5     broadcasting distribution undertakings; and Public
 6     Notice 1997-27 on the contributions by BDUs to the
 7     CTCPF wherein we suggested that the underrepresented
 8     category be expanded to include educational and
 9     information programming, and that BDUs should have the
10     option to direct contributions to existing
11     independently-administered production Funds.
12  4577                 MR. ELSON:  The CIFVF is the only
13     national funding organization in Canada working to
14     support the program production sector that specializes
15     in Canadian lifelong learning programming.  Our
16     clientele base comprises 2,800 producers from all parts
17     of Canada.
18  4578                 CIFVF supported programming is
19     educational or informational in nature, deals with any
20     subject matter, is geared to specific audiences, may be
21     distributed in schools, universities and colleges,
22     libraries, health institutions, on educational and
23     specialty television, CDROMs and over the Internet; has
24     budgets in the range of $70,000 to $750,000; may have a
25     variety of funders, such as government, corporations,


 1     provincial funding agencies, other private funding
 2     agencies, broadcast licences, Telefilm Canada, tax
 3     credits, Canada Council or the NFB, and producers'
 4     deferrals; and is produced by Canadian independent
 5     producers and adds to Canadians' understanding.
 6  4579                 The CIFVF has responded to only some
 7     of the questions raised by the Commission that most
 8     concern our organization.
 9  4580                 The CIFVF is of the opinion that
10     government must continue with policies that ensure
11     funding sources for Canadian programming.  While we
12     realize that this is not totally within your
13     jurisdiction, through your policies and the regulatory
14     framework, the Commission does influence the type and
15     diversity of programs that are produced.
16  4581                 The CIFVF was challenged three years
17     ago to become self-financing.  We took this challenge
18     very seriously, hired fund raisers, appealed to various
19     levels of government, approached corporations in the
20     private sector in the communications area, as well as
21     non-communications companies, and have achieved only
22     small success.
23  4582                 We can tell you from this time-
24     consuming, expensive and difficult process how
25     difficult it is to attract private investment.  Based


 1     on these efforts in this area, we have come to the
 2     realization that government must continue with policies
 3     that ensure various funding sources for Canadian
 4     programming.
 5  4583                 MS JACKSON:  We emphasize that
 6     Canadian content requirements for broadcasters, as
 7     contained in the existing regulations, remain an
 8     effective mechanism for achieving the objectives of the
 9     Broadcasting Act.
10  4584                 In this respect, we are of the
11     opinion the Canadian content requirements, coupled with
12     the variety of funding programs available in this
13     country, are an effective means of ensuring that
14     Canadian television appropriately reflects Canada's
15     diversity.
16  4585                 To this end, through the programming
17     that it funds, the DIFVF helps to advance and profile
18     Canada's diversity in all its forms, from cultural,
19     regional and linguistic diversity, to diversity of
20     access, of subject matter and funding partners.
21  4586                 Examples of programming that we have
22     funded which we think embody the many facets of
23     diversity include:  "Tierre madre", produced in
24     Spanish, English and French, on human rights and land
25     distribution in Guatemala; "Ne me fais pas rougir",


 1     which deals with the problem of pressure ulcers for
 2     handicapped people; "Saputi", which chronicles the
 3     daily lives of the Inuit people in the Igloolik area;
 4     "Teen Rebel, Teen Mom", which follows four single
 5     teenage mothers who are struggling to find their
 6     identity through parenting.
 7  4587                 We would emphasize that it is
 8     important not to sacrifice Canadian programming
 9     diversity at the expense of commercial viability and
10     international exportability.  In this respect, the
11     CIFVF feels that the CRTC should not overlook the
12     equally important emphasis on high quality Canadian
13     programming that is geared to smaller or more
14     specialized localized audiences.
15  4588                 As we said in our brief, the strong
16     emphasis on generating large audiences and ensuring
17     export potential which the CIFVF senses underlies
18     sections of Public Notice 1998-44, if privileged in
19     CRTC policy-making, could result in a Canadian
20     television system that promotes only pragmatic
21     pluralism, or those forms of diversity that are likely
22     to be solely commercially viable.
23  4589                 We should also point out that in the
24     context of the discussion about Canadian viewers,
25     programs financed by the CIFVF have a strong


 1     identification with their viewers.  Each project funded
 2     by the CIFVF has identified its target audience,
 3     provides an assessment of the viewer or end user's
 4     needs and has letters of support from its potential end
 5     users.
 6  4590                 One may not be able to judge our
 7     programs by the Nielsen ratings but, rather, by the
 8     impact and empowerment that they bring to the lives of
 9     Canadians.
10  4591                 MR. ELSON:  We would like to speak to
11     the issue of the underrepresented category of
12     programming.
13  4592                 The CIFVF feels that the term
14     "underrepresented" should be re-examined and revamped.
15     The reason that we raise this point is that there is a
16     definite need for what we have termed lifelong learning
17     materials or educational/informational programming and
18     a glaring lack of funding for it.
19  4593                 With the proliferation of specialty
20     channels, the need for this type of programming has
21     grown exponentially.  We also feel that this type of
22     programming is not any less "Canadian" than dramatic
23     programming.
24  4594                 On a related issue, in response to
25     item 30 in Public Notice 1998-44, the CIFVF would


 1     suggest that the Commission needs to place a greater
 2     emphasis on documentary programs, not only in their
 3     scheduling but in treating them on a "level playing
 4     field" with entertainment programming.
 5  4595                 Documentaries provide viewers with
 6     distinctly Canadian programming which have rich and
 7     varied styles of presentation.  They give expression to
 8     a great variety of voices from across the country to
 9     contribute critical and thoughtful reflections on a
10     broad range of subjects.
11  4596                 One way of encouraging this would be
12     to increase time credit to 150 percent.
13  4597                 MS JACKSON:  We are in agreement with
14     the Association for Tele-Education in Canada (ATEC)
15     which states that thee is a need for funding for
16     Canadian programming designed for lifelong learning.
17  4598                 As they mention, although non-
18     broadcasting technologies are also used to extend
19     educational programs, television remains the most
20     effective medium for creating and reinforcing a
21     Canadian learning culture.  With the proliferation of
22     educational and specialty channels, there is more than
23     ever a need for this type of programming.
24  4599                 MR. ELSON:  The Commission is quite
25     correct in its statement in Public Notice 1998-44 that


 1     the Canadian independent production sector has
 2     significantly increased in strength throughout the
 3     country.
 4  4600                 This is due, in part, to incentives
 5     and funding programs instituted by federal and
 6     provincial governments and to indirect support from the
 7     Commission through its policies of requiring BDUs to
 8     contribute to production funds and requiring
 9     significant public benefits when the ownership or
10     control of a television programming undertaking is
11     transferred.
12  4601                 We would like to state that these
13     policies of the Commission must remain in place.
14  4602                 The reason we state this is that what
15     attracts audiences to television is the programming
16     (and not the advertising).  In order to have the
17     diversity of programming that is necessary and that is
18     still an objective of the Broadcasting Act, money is
19     required to feed the program production machine so that
20     it can deliver this programming to broadcasters.
21  4603                 In this respect, it seems that there
22     is never enough money with which to produce Canadian
23     programming.
24  4604                 We strongly disagree with the
25     Production Company Study done by CTV/Baton that


 1     concluded that there is no need for further policy and
 2     regulatory initiatives to support the independent
 3     production sector.  The study's conclusion is based on
 4     the examination of the financial performance of the top
 5     five publicly traded Canadian production companies in
 6     comparison to the private television broadcasting
 7     industry which found that the revenue for these five
 8     companies is almost half the revenues of the entire
 9     private TV broadcasting industry.
10  4605                 While the revenue figures reported in
11     the study may be true, these five companies do not
12     speak to the overall health of the smaller and medium
13     size production companies which constitute the bulk of
14     the program production industry.
15  4606                 In fact, with the recent round of
16     takeovers and consolidations --
17  4607                 MS BÉNARD:  Mr. Elson, could you slow
18     down, please.  Our translators are having trouble
19     following you.
20  4608                 MR. ELSON:  In fact, with the recent
21     round of takeovers and consolidations, we fear more
22     than ever that the smaller size producers and
23     production companies that we deal with, and who ensure
24     the diversity in programming we were talking about,
25     will not be able to continue to access funding to make


 1     programming and get it broadcast.
 2  4609                 MS JACKSON:  Now is not the time for
 3     the government or the CRTC or broadcasters to back off
 4     from their commitments to ensure that thee are
 5     mechanisms to assist Canadian programming, and in
 6     particular CIFVF programming, to get produced.
 7  4610                 We would like to say that while the
 8     CRTC's decision in Public Notice 1997-98 was a welcome
 9     one in that the Commission now allows up to 20 percent
10     of the monies for the creation of Canadian programming
11     to be directed by a broadcast distribution undertaking
12     (BDU) to new or existing independently-administered
13     funds, other than the CTF, that with the exception of
14     Fundy Communications and another DTH company that is in
15     discussions with us, not many of the BDUs have taken up
16     the option.
17  4611                 We think that because the Commission
18     has placed such a strong emphasis on programming
19     category 7 and feeding the CTF and other funds to
20     finance this category, that funds like ours lose out.
21  4612                 In conclusion, we would like to
22     reiterate our main points:
23  4613                 (1) Educational and informational
24     programming should be considered as "underrepresented"
25     programming.


 1  4614                 (2)  The CRTC should encourage BDUs
 2     to contribute to independently-administered funds such
 3     as the CIFVF.
 4  4615                 (3)  The diversity of programming
 5     produced by our 2,800 producers may not always be
 6     exportable but is important to be produced and funded.
 7  4616                 The CIFVF is convinced that it is
 8     doing its part to assist in the creation of programming
 9     content that Canadians need and demand.  To this end,
10     we remain active in looking for long-term solutions to
11     the challenge of assisting Canadian independent
12     producers to produce the best programming possible.
13  4617                 We thank you for this opportunity and
14     will answer any questions.
15  4618                 THE CHAIRPERSON:  Thank you. 
16     Commissioner Pennefather?
17  4619                 COMMISSIONER PENNEFATHER:  Good
18     morning.  Thank you for that presentation, which raises
19     a number of very important points in relation to this
20     hearing and brings to the discussion the role of broad
21     sector of the production community.
22  4620                 In that regard, I would like to
23     begin, if it is all right with you, to talk about the
24     fund itself and clarify a few points concerning the
25     kinds of productions that we are talking about here;


 1     the fund and how it works; and then go on to discuss
 2     some of the policy issues and your concerns as you have
 3     raised them this morning and in your written
 4     submission.
 5  4621                 As you explained, this fund emerged
 6     from the Non Theatrical Production Fund, or the DSS
 7     Fund, as it was once called.  The term "non theatrical"
 8     -- which you have reiterated again this morning --
 9     covers quite a wide range of programming.
10  4622                 What I would like you to do, if you
11     would, is clarify what kinds of products you are
12     supporting, for what audiences, and how they are
13     distributed.
14  4623                 The reason I want to do this is to be
15     very clear about the definition of "informational
16     educational programming" vis-à-vis, for example,
17     documentary, just to be clear on what it is we are
18     talking about.
19  4624                 Could we start with that, and then we
20     will go on with some other questions on the nature of
21     the product you are dealing with through the fund.
22  4625                 MS JACKSON:  As you said, the Non
23     Theatrical Fund was created in 1988, had some ups and
24     downs, and eventually was rolled out to the private
25     sector in 1991 when the Canadian Independent Film and


 1     Video Fund was established.
 2  4626                 It started out, as you stated, as a
 3     non theatrical market fund, which was literally not
 4     television and not commercial film for the theatres. 
 5     It was only for product designed for schools,
 6     universities and public libraries.
 7  4627                 When the Independent Film and Video
 8     Fund was established, life had evolved, things had
 9     changed, technologies had changed, and it was decided
10     by our board of directors that the term "non
11     theatrical" was not entirely comprehensive and needed
12     to be expanded.
13  4628                 To that end, it was expanded to
14     include not only -- all non-theatrical products go to
15     schools, universities and public libraries.  But it has
16     been expanded to include educational and specialty
17     television primarily, the business area, home video,
18     community associations, social service agencies and
19     multimedia.
20  4629                 As time has gone on, the definition
21     has become larger and larger.
22  4630                 COMMISSIONER PENNEFATHER:  Just
23     generally, where are these products distributed and how
24     are they distributed:  through the television system or
25     direct to schools through video?


 1  4631                 How is that handled now?
 2  4632                 MR. ELSON:  In a number of ways.  For
 3     a short answer, both.
 4  4633                 What has happened is with the
 5     explosion of the specialty channels, there is an
 6     increased demand.  We clearly are seeing specialty as
 7     being a new distribution vehicle for educational
 8     materials.
 9  4634                 At the same time, the same products
10     can go to a specialty channel, they can go to schools,
11     they can be used within specific institutions.  So it
12     very much depends on the product.
13  4635                 But it can be a number of ways.  It
14     can also be to a relatively small audience through
15     specialty.  One of the things that is happening with
16     the exposure to specialty is that it can go on a
17     specialty channel to what we are clearly defining as
18     niche programming.  Niche programming can be 10,000,
19     20,000 people, but it can reach them very easily
20     compared to old systems of distribution through
21     specialty.
22  4636                 COMMISSIONER PENNEFATHER:  We can say
23     that, though, generally about a lot of documentary
24     programming on air for niche audiences.  What makes it
25     educational programming?


 1  4637                 MS JACKSON:  I think educational
 2     programming -- documentaries are documentaries, I
 3     guess.
 4  4638                 Educational, for us, may be things
 5     that don't have a definite point of view.  For example,
 6     "Paradigms of Performance" is for management training,
 7     looking at concepts for management.  I don't think you
 8     could define that as a documentary.  It is specifically
 9     for training people in various sectors of businesses
10     primarily, but could be used in universities, et
11     cetera.
12  4639                 COMMISSIONER PENNEFATHER:  So the
13     "how to" as opposed to the 30-minute documentary.
14  4640                 MS JACKSON:  Yes, "how to's".
15  4641                 COMMISSIONER PENNEFATHER:  Which of
16     the two do you call the lifelong learning materials?
17  4642                 MS JACKSON:  I would include it all. 
18     I think the documentaries inform us and enlighten us. 
19     I think that educational programming does the same. 
20     And informational programming, which we think is a
21     separate category which is not being dealt with --
22     things like we assisted a program to be produced on
23     scams for senior citizens.  I would say that is
24     information programming on how seniors could deal with
25     telemarketers, things that involve scamming.  I would


 1     say that is informational, and I would say that that is
 2     also educational.
 3  4643                 COMMISSIONER PENNEFATHER:  So that we
 4     start defining clearly in terms of what is working out
 5     there, what are the needs, and what the production
 6     community you are really representing see as the bulk
 7     of the work they are doing, in that regard, I assume
 8     from your submission that you fund new media products.
 9  4644                 What proportion of the funding that
10     you are putting into products -- which averages about
11     $18,000 per project, I think -- is new media products?
12  4645                 MS JACKSON:  In our last round, we
13     had $500,000 for funding.  We work by deadlines.  We
14     received about 160 applications, and we allocated
15     $100,000 to new media.
16  4646                 Because as we started the majority of
17     our board is focused on film and video -- although we
18     are trying to move into the area and help our producers
19     to do so -- we have limited resources and are spending
20     a much smaller amount.
21  4647                 Our main focus has been film and
22     video, and we are spending a smaller amount on new
23     media.  So $100,000 was spent of the $500,000 on new
24     media in the last round.
25  4648                 COMMISSIONER PENNEFATHER:  Is it your


 1     observation that the independent production community
 2     we are talking about here is in a position to really
 3     provide the Canadian materials to the educational
 4     systems, be they direct to schools, be they through the
 5     Internet, be they through specialty television or
 6     educational television?
 7  4649                 MR. ELSON:  Yes, definitely.  There
 8     is an enormous capacity by small producers across the
 9     country, a desire to produce programming.
10  4650                 One of the things that perhaps is
11     very different in terms of CIFVF is that we represent
12     mainly small producers who are locally oriented.  So
13     they will produce lots of programming this coming from
14     their communities.
15  4651                 We are also very broadly based across
16     the country.
17  4652                 In relation to your last question, I
18     think there is an enormous potential and desire to link
19     film and television programming to new media.  We have
20     seen an enormous demand for that, and yet still to now
21     there are very limited funds to make that available for
22     these kinds of producers to produce that kind of
23     programming.
24  4653                 But yes, definitely, to your
25     question.


 1  4654                 COMMISSIONER PENNEFATHER:  What is
 2     the relationship of the fund with the various
 3     educational broadcasters, including Télé-Québec?
 4  4655                 MS JACKSON:  I am not sure how you
 5     are defining "relationship".
 6  4656                 In most of our projects I would say
 7     that the educational broadcasters, particularly SCN,
 8     put in a very small amount, but they are usually always
 9     there.  Vision Television is a very constant partner in
10     our projects.  ACCESS and Knowledge Network are quite
11     often in our projects, for smaller amounts because they
12     obviously don't have the required resources.
13  4657                 I would say that we have a very
14     dependent relationship with them.
15  4658                 COMMISSIONER PENNEFATHER:  In the
16     mix, you mentioned quite a few different co-financiers
17     and projects.
18  4659                 Is the educational broadcaster a
19     major component vis-à-vis Telefilm, vis-à-vis CTF, as
20     we now call it, vis-à-vis others?  Or does it vary?
21                                                        1035
22  4660                 MS JACKSON:  I would say it does
23     vary, but they are usually always there.  They are
24     usually in the position of the second window.  As you
25     know, that's a very necessary role that they fulfil.


 1  4661                 COMMISSIONER PENNEFATHER:  I should
 2     say to you that when SCN was here, they claimed that
 3     there were no funds coming from your fund into
 4     Saskatchewan.  I'm not saying you should answer that
 5     now.  It's just a question of perhaps explaining how,
 6     since you are covering the country and you do call
 7     yourselves in your paper or your written submission a
 8     cultural institution in this country, how you deal with
 9     this important but often challenging aspect of
10     distributing funds across the country.
11  4662                 MS JACKSON:  I think you have used
12     the right word, challenging.  I think we often feel
13     that it's Jesus and the loaves of bread trying to make
14     things go and be duplicated as far as we can.  It's a
15     very difficult situation.
16  4663                 Since our inception in 1991, we have
17     received close to 1,700 applications.  I would think we
18     probably received more applications than any other
19     funding agency on a per deadline basis.
20  4664                 We have an earmarking or a targeting
21     system that we try and do.  Up to 1996 it was based on
22     one fifth going to the west, one fifth to Ontario, one
23     fifth to Quebec, one fifth to the maritimes and one
24     fifth to projects of merit, which was fairly loose.
25  4665                 In response to some of the prairie


 1     provinces, we decided to try and revamp that.  We took
 2     the merit category of one fifth and now we spend one
 3     fifth on the prairie provinces, which includes
 4     Saskatchewan, Alberta and Manitoba.  I have to tell you
 5     in the last deadline we could only provide money with
 6     our allocations to two projects from the prairies.
 7  4666                 COMMISSIONER PENNEFATHER:  From the
 8     prairies.
 9  4667                 MS JACKSON:  To the prairies.
10  4668                 COMMISSIONER PENNEFATHER:  So that's
11     the three provinces.
12  4669                 MS JACKSON:  That's right.
13  4670                 COMMISSIONER PENNEFATHER:  Okay.  On
14     that score, in your submission you note that government
15     funding of the CIFVF -- are you going to shorten that? 
16     It's now down to CTF, so this is the CIFVF.  You are
17     scheduled to have your funding terminate in March 1999,
18     I think.
19  4671                 Your organization has taken on the
20     role of administering other private funds.  I think
21     that's a point that is key to your submission too.  The
22     funds are the Stentor New Media Fund, Funding
23     Communications Production Fund and Star Choice
24     Specialty Fund.
25  4672                 If your funding is not extended past


 1     March 1999, will the CIFVF be able to continue as an
 2     organization on the basis of these new administrative
 3     functions?
 4  4673                 MR. ELSON:  We are making a major
 5     effort to encourage government to continue funding and
 6     increase funding.  We feel that there's an enormous
 7     demand.  We compare our funding ratio to the other
 8     major funding institutions, whether it's Telephone
 9     Canada or Canada Council, and find that we are funding
10     one out of seven compared to one our of three
11     applications when our peer juries are indicating that
12     perhaps 67 per cent of the applications ought to be
13     funded.
14  4674                 What we are finding is that we are
15     funding a much lower level in terms of in relationship
16     to the projects submitted than the other funds.  We are
17     asking government, following the efforts that we made
18     in the last few years to find private sector funding,
19     to not only continue to fund, but increase funding.
20  4675                 As well with that, we would ask the
21     Commission to encourage and promote the possibility
22     that the broadcast institution undertakings use the 20
23     per cent initiative that was allowed and perhaps even
24     increase that so that increased funding from private
25     sector sources will allow the fund to continue.


 1  4676                 COMMISSIONER PENNEFATHER:  But should
 2     the government funding not continue, do you think that
 3     this function of administering the other funds will
 4     work?
 5  4677                 MR. ELSON:  Not unless through your
 6     efforts and decisions on BDU's part to increase their
 7     use of the 20 per cent initiative and your allowance
 8     that the 5 per cent that's allowed for administration
 9     be increased, no.  That 5 per cent, for instance, on
10     the part of BDU's undertakings, if it's a small amount,
11     becomes not enough to hire a part time administrator.
12  4678                 Clearly those are two areas if
13     government should not continue and increase funding
14     that we would need to see a large increase in to
15     continue.
16  4679                 COMMISSIONER PENNEFATHER:  So this
17     brings us to your recommendation in fact that benefits
18     packages for BDUs should continue to be a requirement
19     and should build on public notice 9798 which determined
20     that BDUs may allocate 20 per cent of the amounts for
21     the creation of Canadian programming to independently
22     administered production funds.
23  4680                 Let's keep going on this point a
24     little bit longer.  You raised it this morning as well. 
25     If you could clarify or elaborate on this statement


 1     that the 20 per cent initiative could be further
 2     developed by the CRTC.  Could you just explain that a
 3     little bit more?
 4  4681                 MR. ELSON:  One element that is very
 5     clear in how funding has been encouraged through
 6     various means is that there has been in the last few
 7     years enormous emphasis on drama through regulation and
 8     through orientation in terms of the funds.
 9  4682                 Whether it is the CTCPF, now the CTF,
10     or through the allocation of 20 per cent, 80 per cent,
11     we clearly think that in terms of production, both
12     documentary and educational information programs are
13     not only equally valid but play a role in terms about
14     quality and in terms of interest for the Canadian
15     viewers, that there has been a disproportionate
16     emphasis on drama.
17  4683                 We would encourage you to think about
18     further promoting and encouraging the use of the 20 per
19     cent.  One of the problems that has happened with the
20     CTF is it's just much simpler for BDUs to put all the
21     money there, not to use the 20 per cent initiative.  I
22     would throw it to you to say what could be done in
23     terms of encouraging broadcast distribution
24     undertakings to fund a fund like ours through the 20
25     per cent initiative which would then balance the


 1     funding that is going to drama.
 2  4684                 If you look at the CTF also within
 3     that, 80 per cent of the funds of the CTF are
 4     designated for drama, which means that the remaining 20
 5     per cent covers documentary, children's programming and
 6     variety.  That is very limiting.
 7  4685                 COMMISSIONER PENNEFATHER:  So you say
 8     what you mean by further developed is that we find ways
 9     to encourage this to happen, that funds go to other
10     funds, other kinds of funds.  Any suggestions?  Any
11     more specific suggestions in that regard in terms of
12     encouragement?  You said that we should encourage.
13  4686                 MS JACKSON:  The only other thing
14     that I can add is while it's written in your public
15     notice, I'm not sure that that is enough endorsement
16     perhaps from the Commission.  I mean, I guess we need
17     the stamp of Good Housekeeping in a way from you to
18     promote that and show the BDUs that in fact you do
19     actively support that option.
20  4687                 COMMISSIONER PENNEFATHER:  This
21     somewhat explains the reason for my questioning about
22     the kind of programming we are talking about because it
23     is important to understand that you are covering quite
24     a broad range of programming.  I am assuming that you
25     are making this recommendation and that you are also


 1     recommending that, for example, we revise the
 2     definition of under-representing programming to include
 3     educational and informational programming.
 4  4688                 That documentaries should be included
 5     in under-represented programming; greater emphasis on
 6     documentary programming, not only in their scheduling
 7     but in treating them on a level playing field with
 8     entertainment programming.
 9  4689                 In addition to your recommendation
10     vis-a-vis the 20 per cent, you are also looking at the
11     current policies and suggesting some change there.
12  4690                 In the first instance, if we look at
13     the definition of under-represented programming, is
14     there not a danger of diluting the effectiveness of the
15     related regulatory provisions if virtually all types of
16     programming are called under-represented?
17  4691                 MR. ELSON:  It goes back to your
18     opening remarks, the definition of educational
19     informational.  I mean I think you have to be very
20     careful about that.  I think we can talk a little bit
21     more about that.
22  4692                 One of the things we are looking at
23     is in terms of the kinds of proposals that are coming
24     to us.  Remember, it's not the fund that decides the
25     programming, it's the producers and they come up with


 1     ideas.  They are looking at the marketplace and seeing
 2     what's going on.
 3  4693                 We are getting a lot of what are
 4     called segment informational programming, educational
 5     material that is hosted, documentaries that are hosted,
 6     things that do not qualify under Canadian Television
 7     Fund definitions of documentary, for instance, and
 8     series programming.
 9  4694                 A lot of this has been driven by
10     demand from specialty broadcasters.  We have been
11     unable, except in exceptional cases, chiefly in
12     development, to respond to that need.  We funded mainly
13     documentary, but we are seeing that the demand is there
14     and the producers coming up with those projects.
15  4695                 What we are looking at, and I don't
16     know that I have specific examples, but Robin may be
17     able to add to that, is the kind of program where you
18     have a magazine educational program and we have
19     segments that are not eligible for our funding, but has
20     as well as documentary long term value that will have
21     long shelf life, that will have interest on a long term
22     basis, but can definitely meet a need for certain
23     educational needs and be broadcast on an education
24     broadcaster or specialty broadcaster.
25  4696                 I agree with you, you have to be


 1     careful of the definition.  We are saying that kind of
 2     programming needs to be supported and needs to be
 3     produced by Canadian producers so that that need is met
 4     in terms of what is being demanded and that we are
 5     seeing long term what is going on in society keeps
 6     holding from what we are seeing, that people are going
 7     to be looking at a long term process of education and
 8     that the educational broadcasters can be trying to meet
 9     that need.
10  4697                 It's going to be difficult to do so
11     with Canadian programming unless we find sources of
12     funding for it.  If we don't, clearly it is going to be
13     met by other sources.  That's true for educational
14     broadcasters.  It's also true for schools' use in terms
15     of educational institutions or public health
16     institutions.
17  4698                 We are saying yes, we need to change
18     things.  We do not need to open up all the way, but we
19     need to come up with perhaps a new definition of
20     educational informational programming that has long
21     term value, that's not going to just have short term
22     use, and support that as well as other kinds of
23     programming like drama for Canadian producers to be
24     able to produce that on a competitive basis.
25  4699                 COMMISSIONER PENNEFATHER:  In


 1     addition to that definition then, you addressed the
 2     exhibition side in terms of documentary and you also
 3     addressed the expenditure side, saying that the
 4     regulatory emphasis in terms of stipulation on
 5     expenditures for entertainment should be expanded to
 6     include documentary.
 7  4700                 It has been suggested in today's
 8     competitive and broadcasting environment that
 9     expenditures requirements are no longer necessary. 
10     What is your position on this issue?  Do you think
11     expenditure requirements are still necessary?  If they
12     were eliminated, are there other ways to promote the
13     production and exhibition of documentary programming?
14  4701                 MR. ELSON:  We would feel that
15     expenditure requirements are absolutely necessary.  I
16     mean, history tells us that if they are not there, this
17     kind of programming will not be supported, especially
18     by private producers -- private broadcasters.
19  4702                 We underline one element that we hope
20     will encourage that which is creating a level playing
21     field in terms of classifying documentary programming,
22     specifically for documentary programming in the
23     entertainment sector, so that we will get a 150 per
24     cent time credit which we would hope then would
25     encourage private broadcasters and broadcasters who are


 1     not programming that kind of production as well as, if
 2     you will, benefit those broadcasters who are already
 3     doing so and, therefore, allow them to put more
 4     resources into that area.
 5  4703                 It's twofold, if you will.  It's both
 6     by encouraging funding and at the same point
 7     encouraging benefits by putting that in prime broadcast
 8     time.  I think they are both necessary.
 9  4704                 You asked the other question, what do
10     you do if you don't have that.  I think it's a very
11     good question.  I'm not sure that this kind of
12     programming, although we think we will reach audience
13     does reach audience, is exportable, travels perhaps
14     much better than drama, would get the first dollars if
15     there was an expenditure requirement.
16  4705                 COMMISSIONER PENNEFATHER:  You
17     yourself make the point about this programming travels
18     well, it's exportable.  In fact, I think the gentleman
19     from ACCESS talked about important U.S. markets for the
20     educational programming they are producing. 
21     Historically we know this has been the case.
22  4706                 We are also entering into new
23     environment where there may be other vehicles such as
24     the Internet and the digital universe to assure market
25     for the educational product we are talking about, be it


 1     a documentary, be it an educational CD, be it some
 2     other form of producing a lifelong learning product.
 3  4707                 Are you saying there may be other
 4     options besides spending requirements in broadcast
 5     television?
 6  4708                 MR. ELSON:  We are not seeing those
 7     yet.  I think those potential markets are there, but
 8     they are still potential.  I mean, the actual number of
 9     these kinds of productions that see those kinds of
10     dollars related to their production costs is very low.
11  4709                 Even with, you know, maximum export
12     we don't meet costs of production.  I don't think
13     there's anything that is going to be even close to
14     that.  What it is it becomes complementary and
15     encourages small production companies therefore to
16     continue to exist, to reinvest in new products, to
17     develop exports of Canadian programming to Canadian
18     values, but to think that that can replace expenditure
19     requirements I think is totally unrealistic.
20  4710                 COMMISSIONER PENNEFATHER:  I have a
21     question.  I wasn't sure I understood a comment on page
22     16 of your written submission. If you could explain it
23     to me.  It says to the effect that the definition of
24     peak viewing times should be redefined in a way that
25     reflects the evolving context of specialty services and


 1     a broadcasting environment that is increasingly
 2     providing services "on demand".
 3  4711                 Could you just explain that to me?
 4  4712                 MR. ELSON:  I can start and Robin may
 5     be able to continue.
 6  4713                 It has to do, I think, with the
 7     broadcasting cycle, especially services, that the
 8     programming is on, not just in peak viewing hours from
 9     six to midnight, but on a 24 hour basis and that is
10     recycled at different times when people may be more
11     available to watch it.  You may be reaching an audience
12     -- one of the things specialty broadcasters demand is
13     multiple if not unlimited broadcast rights compared to
14     the traditional broadcaster in the past who would say
15     I'm going to take three broadcasts in, you know --
16     major conventional broadcasters still say three or four
17     broadcasts in a four year period.  A specialty
18     broadcaster may broadcast 50 times in a five year
19     period or 20 times, depending on the broadcaster and
20     depending on their programming cycle.
21  4714                 What you have done is change by
22     nature of what the specialty broadcasters are doing the
23     nature of prime time viewing.  When people are
24     available, television is much more now providing it to
25     them at the hours they want, especially specialty


 1     broadcasting, rather than defining the hours when
 2     people have to watch.
 3  4715                 Is that clear?
 4  4716                 COMMISSIONER PENNEFATHER:  I think
 5     so.  I just want to be sure that I understand.  For
 6     example, some of the conventional broadcasters have
 7     argued for greater flexibility in their scheduling. 
 8     Are you saying you are comfortable with Canadian
 9     programming being assessed as available to Canadians
10     throughout the broadcast day in terms of your kind of
11     product and your kind of audience.
12  4717                 MR. ELSON:  In terms of the
13     educational informational programming, yes, not
14     necessarily in terms of the documentary program. 
15     There's an overlap.  There's a difference between a
16     documentary and educational informational.
17  4718                 COMMISSIONER PENNEFATHER:  That's
18     what I was getting at at the beginning.
19  4719                 MR. ELSON:  Yes.
20  4720                 COMMISSIONER PENNEFATHER:  So when
21     you recommend documentary as being included in
22     under-represented, it is one thing.  When you recommend
23     educational informational programming, it's another
24     thing.
25  4721                 MR. ELSON:  Well, documentary is


 1     already in under-represented.  It's just not
 2     necessarily given priority in under-represented.  What
 3     we are saying very strongly is that educational
 4     informational programming of a specific nature should
 5     be added to the under-represented category.
 6  4722                 COMMISSIONER PENNEFATHER:  This leads
 7     me to ask you what you think of the CAB's
 8     recommendation regarding the establishment of goals
 9     with respect to viewing levels for Canadian
10     programming.  What do you think of that recommendation? 
11     What would be the impact on the kind of products we
12     have been talking about today and that you fund?
13  4723                 MR. ELSON:  The basic question is how
14     do you measure that and on what basis.  I mean, that
15     gives you the answer.  I mean I think very much how you
16     define the measurement of that is going to define the
17     answer you get.
18  4724                 I have only been aware for a couple
19     of days since they presented their position on it, but
20     I, you know, find it very questionable.  I find, you
21     know, how you measure audience difficult and on what
22     basis.  One of the things that is very clear for us is
23     it's not just numbers, it's the impact of programming. 
24     It's how viewers' lives are changed, how they are
25     empowered by programming and how people look at


 1     programming, how long programming lasts.
 2  4725                 If you look at when the United States
 3     or most recently, you know, certain videotapes were
 4     submitted to, you know, to broadcast, I mean clearly
 5     you can get a wide audience.  You know, if there's a
 6     major event, news event, you can get a wide audience.
 7  4726                 How you define audience and what an
 8     audience means to us I think is very important.  How
 9     programming impacts on people's lives, how long it
10     lasts, you know, the influence of that programming are
11     other ways of measuring it.  That's very difficult to
12     measure compared to pure numbers.
13  4727                 Even when you are measuring pure
14     numbers, what those numbers mean and on what basis, you
15     know, how people are viewing, are they walking by a
16     television set that's open in a room.  It makes me
17     question enormously that you could base programming
18     requirements on audience.
19                                                        1055
20  4728                 COMMISSIONER PENNEFATHER:  Finally, I
21     think we did touch on the digital universe and its
22     impact on the kinds of programming we have been talking
23     about -- namely, educational, informational and
24     documentary.  Do you have any further comments on the
25     opportunities that digital programming, digital


 1     carriage offer to the community which you are dealing
 2     with, both in terms of producers and in terms of
 3     audiences or, as you call them, end users?
 4  4729                 MR. ELSON:  I will speak a little bit
 5     and I would like Robin to speak a little bit also.
 6  4730                 It is an enormous opportunity, but it
 7     is also even more a challenge,  The small producers
 8     haven't really been included in this discussion very
 9     much so far.  The costs of going to high definition are
10     very significant.  I don't think any small producers
11     are going to be doing that until clearly that is
12     established as the broadcast format and the demand is
13     there.  I mean we don't even have a demand for
14     television for wide screen.  You can't really produce
15     anything in 16 by 9 for Canadian broadcasters because
16     there is no outlet for it, chiefly not in terms of
17     major broadcasters, so we are all still producing it 4
18     by 3, even though there might be a demand
19     internationally for 16 by 9.
20  4731                 What is very interesting I think for
21     the kinds of producers that the fund grants funding to
22     is the interrelationship between the potential in terms
23     of digital and all the kinds of information and
24     research that is accumulated in terms of educational,
25     informational and documentary programming that could be


 1     made available by digital system.
 2  4732                 We have numerous producers wanting to
 3     create programming related to the internet, related to
 4     CDROMs based on this kind of film and television
 5     production.  You can imagine the kind of scenario we
 6     were hearing just earlier about a digital system that
 7     allowed people to access additional information on
 8     specific topics that would give them access to
 9     documentation immediately through a television system. 
10     Clearly, that would be of great interest for the kind
11     of programming we are talking about.
12  4733                 I don't think it is proven in the
13     immediate past in terms of the efforts to make
14     interactive programming, seen from a different point of
15     view in a drama program, maybe in a hockey game, but
16     even then it is not what viewers are really interested
17     in.  But saying in this program there was this item and
18     I really needed to know more and I can just access it
19     very quickly and get further references and further
20     information and download it, either in a text format or
21     in a CDROM format or have it simultaneously, clearly
22     would be of great interest to the kind of programming
23     that the producers we represent -- the programming they
24     do.
25  4734                 How you create the means for them to


 1     do that is a good question.  I think again that's a
 2     funding question, the relationship between the funding
 3     of new media which is already in place before the
 4     digital system comes into effect and traditional film
 5     and television programming is an area where it can be
 6     helped immediately in terms of funding for new media. 
 7     So that when we have a digital system, if it allows for
 8     that there can be a merging of those two.
 9  4735                 COMMISSIONER PENNEFATHER:  Thank you.
10  4736                 One last point before I leave you,
11     just a factual question and if you can answer it now
12     fine, if not, get back to me.  I have noticed we have
13     talked and I have noticed in your submission that you
14     refer to the use of the fund by Canadian specialty
15     service.  If you could give us an indication of
16     approximately how much money and/or how many programs
17     the CIFVF allocated to specialty services last year and
18     what proportion of your annual budget this funding
19     represents?
20  4737                 MS JACKSON:  I don't have those
21     figures with me.  I would be pleased to provide them to
22     you at a later date.
23  4738                 COMMISSIONER PENNEFATHER:  Thank you.
24  4739                 That completes my questions, Madam
25     Chair.


 1  4740                 THE CHAIRPERSON:  Commissioner
 2     Cardozo.
 3  4741                 COMMISSIONER CARDOZO:  Thank you,
 4     Madam Chair.
 5  4742                 I have one question I wanted to ask
 6     about.  It is regarding a comment in your oral
 7     presentation, page 2, point No. 2, you say:
 8                            "...we are of the opinion the
 9                            Canadian content requirements
10                            coupled with the variety of
11                            funding programs available in
12                            this country are an effective
13                            means of ensuring that Canadian
14                            television appropriately
15                            reflects Canada's diversity."
16  4743                 I wonder if you could tell us a
17     little more about that in terms of what drives you to
18     consider the issue of cultural diversity and whether
19     you have had to, or the different types of linguistic
20     diversity and other aspects that you have described in
21     that section and whether you have had to make any extra
22     efforts, any different types of outreach, whether you
23     have had to look at your funding criteria?  I notice
24     that you have done stuff in various languages too, so
25     did that require a change at any point?


 1  4744                 MS JACKSON:  There was no change
 2     required.  It came from the producers themselves.  They
 3     said they were going to do that.  We considered it and
 4     agreed that that was fine by us.
 5  4745                 I am not quite sure -- in the
 6     discussion about diversity, I don't know if you have
 7     had other previous people talk about this.  I find the
 8     whole question of diversity -- we tried to respond to
 9     what we think diversity is.  I am not sure we are all
10     talking about the same thing about diversity.  I am a
11     little confused about is there an operating definition
12     of diversity?
13  4746                 COMMISSIONER CARDOZO:  There are a
14     lot of different things.  I think we are talking on one
15     hand of the diversity of programming, which means a
16     different kind of format, diversity of music, different
17     kinds of genres.
18  4747                 If one is talking about cultural
19     diversity, then I think you are talking about different
20     cultural diversities, such as the things you have
21     talked about here, a program in Spanish, a program
22     regarding Inuit people, so there are different aspects
23     of that.
24  4748                 I am wondering in terms of the
25     programs that you supported, whether you are seeing the


 1     various aspects of the cultural, racial, religious
 2     diversity of the country.  Are there producers coming
 3     to you with those sorts of projects and are they
 4     looking to you as a source of support?
 5  4749                 MS JACKSON:  Yes, they are.  Because
 6     we represent -- we don't represent, we have so many
 7     producers -- we are not an association, but because we
 8     have so many clients that come to us for funding and
 9     these people are spread across the country in large
10     centres, as well as small centres.  It is Canadians
11     that are coming to us with production ideas.  They are
12     not our ideas.  I think I am continually amazed by the
13     type of projects that we are getting and the diversity
14     of them.
15  4750                 We have no restriction on any subject
16     matter because it is all lifelong learning for us.  Did
17     I answer the question?
18  4751                 COMMISSIONER CARDOZO:  Thank you.
19  4752                 THE CHAIRPERSON:  Ms Jackson, you
20     referred to the concern you have that not enough cable
21     operators take advantage of the flexibility they have
22     with regard to who they direct their fund money to, the
23     80/20.  What have been your efforts or that of
24     producers to pressure or educate or request that
25     particular flexibility be taken advantage of, so that


 1     organizations such as yours have the opportunity to
 2     have more funds?
 3  4753                 MS JACKSON:  Are you speaking in
 4     general of what we have done?
 5  4754                 THE CHAIRPERSON:  Yes, because you
 6     say it's your view that distributors who may not be
 7     aware or may not bother or what we said in the Public
 8     Notice wasn't sufficient, we should make better efforts
 9     to endorse that.  So, I am curious to see what efforts
10     you have made or your clients have made vis-à-vis the
11     cable operators, so that more money is funnelled
12     towards organizations such as yours.
13  4755                 MS JACKSON:  We have approached a
14     number of the BDUs.  We have been following the
15     wireless cable situation.  We have approached various
16     companies, such as Alpha Star and we thought we had a
17     deal with them before they went bankrupt.
18  4756                 We approached Power Tel.  We had we
19     thought a deal with them, but they didn't get a
20     licence.
21  4757                 We have approached Star Choice and we
22     are still in discussions with them and we are hopeful
23     we get a portion of their 20 per cent.  It does not
24     appear that we will get it all.
25  4758                 We have been following the LMCS


 1     people and we have been courting them, if I can use
 2     that crass word, but I think they are a bit way down
 3     the road.
 4  4759                 We have written the Canadian Cable
 5     Systems Alliance, which I believe is 80 or so
 6     companies.  We have been working with Fundy
 7     Communications who has had the belief in us to put
 8     their 20 per cent with us and we have been working with
 9     and we have been working with them to approach some of
10     the individual cable operators.
11  4760                 We have not made any attempts to the
12     larger cable operators because we feel that they
13     started the Cable Production Fund and that's sacrosanct
14     for them, that we could not -- it would be offensive to
15     approach them.
16  4761                 THE CHAIRPERSON:  That's interesting
17     because some of them operate regionally.  It's
18     interesting to know that you have made these efforts. 
19     You are not aware of what the producers themselves who
20     come to you for funds are doing because I would have
21     thought that even for the large cable operators that
22     the production industry in the region where they
23     operate could put some pressure on them in that regard
24     because your clients are across Canada.  Correct?
25  4762                 We have this morning a number of


 1     organizations that are regionally based and the
 2     producers they represent I suppose could exercise some
 3     pressure.  It's an interesting aspect of it.
 4  4763                 Once the Commission has decided that
 5     it is a valuable thing to do to split it 80/20, when it
 6     had started at 100 percent, beyond that I think the
 7     industry itself and their representatives and their
 8     organizations should put pressure on because we have
 9     said that's what we thought was in the public interest,
10     so to speak, or in the interest of the industries
11     concerned.  So then the ball is in the court of those
12     who would like to see these funds used in that fashion.
13  4764                 MR. ELSON:  If I can just add a
14     couple of items.  I think in terms of the major cable
15     operators one of the problems is clear identification
16     and desire for identification with the Cable Production
17     Fund, now the CTF.
18  4765                 The other element is even there there
19     is not enough money.  So when that fund is being
20     drained on almost an immediate basis, it is difficult
21     for us to say, "take 20 per cent of it."
22  4766                 But the other element I was --
23  4767                 THE CHAIRPERSON:  It is, though, a
24     reallocation that you are saying would be -- so no
25     matter what the size of the money is, if it is not in


 1     the fund but it is somewhere else, it doesn't matter
 2     how many people line up for it, only 80 per cent of it
 3     will disappear.
 4  4768                 MR. ELSON:  But clearly it is going
 5     to different kinds of productions.  You have let them
 6     know that you would like them to do that, but what we
 7     are saying is we would like you to let them know that
 8     much more clearly and more definitively, that there is
 9     other areas of programming that this 20 per cent could
10     go to and that it ought to go there.
11  4769                 THE CHAIRPERSON:  It is good to know
12     that organizations such as yours are putting some
13     pressure on them or reminding them that that's a
14     flexibility that has been endorsed.
15  4770                 Counsel.
16  4771                 MR. BLAIS:  As the Commission moves
17     forward in this process and considers various
18     submissions, it might need to have a sense of
19     definitions.  I was wondering whether when it comes to
20     documentaries you generally accept the definition used
21     by the Telefilm CTCPF?
22  4772                 MS JACKSON:  Yes, we do accept it.
23  4773                 MR. BLAIS:  You have used the phrase
24     "educational/informational programming."  First of all,
25     is that the same thing to you and, if it isn't, would


 1     it be possible for you to give us a sense of a
 2     definition of that category of programming?  It doesn't
 3     have to be today, but if you could get that on the
 4     record by the 15th of October we would appreciate that.
 5  4774                 MS JACKSON:  Yes, we would be pleased
 6     to do that.
 7  4775                 MR. BLAIS:  Thank you.
 8  4776                 Those are my questions.
 9  4777                 THE CHAIRPERSON:  Thank you.
10  4778                 Thank you very much for appearing
11     this morning.  That was most interesting.
12  4779                 We will now take a well needed and
13     well-deserved 15-minute break.  We will be back at 25
14     minutes after eleven.
15  4780                 Thank you.
16     --- Short recess at 1110 / Courte suspension à 1110
17     --- Upon resuming at 1130 / Reprise à 1130
18  4781                 THE CHAIRPERSON:  Good morning.
19  4782                 We apologize for the delay. 
20     Apparently there was a bee in my microphone that was
21     buzzing.  So, we are back now and you may proceed when
22     you are ready.
23  4783                 Perhaps Madam Secretary should
24     officially call you for the record, excuse me.
25  4784                 MS PÉNARD:  Thank you, Madam Chair.


 1  4785                 The next presentation is by Manitoba
 2     Film & Sound.  I would invite Ms Vivier to introduce
 3     her colleague.
 5  4786                 MS VIVIER:  Thank you.
 6  4787                 Good morning, Madam Chair, members of
 7     the Commission and staff.
 8  4788                 We are very pleased to appear before
 9     you today representing Manitoba Film & Sound Recording
10     Development Corporation.  My name is Carole Vivier and
11     I am the President and CEO of Manitoba Film & Sound. 
12     With me today is Susan Brinton, who is a western based
13     media consultant with many years' experience in the
14     western Canadian broadcasting and production
15     industries.
16  4789                 Manitoba Film & Sound is the
17     provincial funding agency whose mandate is to develop
18     the infrastructure and the promotion and marketing of
19     Manitoba's film, television and sound recording
20     industries.  We are funded by the provincial Department
21     of Culture, Heritage and Citizenship.
22  4790                 Our purpose in appearing before you
23     today is to elaborate on our written brief.  We wish to
24     address issues relating to access to screen time and
25     diversity of programming in the Canadian broadcasting


 1     system.  Specifically, we are concerned about regional
 2     diversity as it pertains to the western provinces. 
 3     While Manitoba Film & Sound is a provincial agency, we
 4     are here to discuss the broader issues as they relate
 5     to both Manitoba and the western provinces as a region.
 6  4791                 We support the Commission's goals for
 7     this Television Policy Review Hearing, specifically: 
 8     to further the development of a strong and viable
 9     programming industry; to ensure that Canadians receive
10     a wide range of attractive and distinctive Canadian
11     program choices; to ensure that the Canadian
12     broadcasting system meets the needs of Canadian viewers
13     and reflects their values; and to implement the public
14     interest objectives of the Broadcasting Act.
15  4792                 It is our position that in order to
16     meet these goals, the Canadian broadcasting system must
17     continue to incorporate the unique contributions of the
18     western based production community.  Regionally
19     produced Canadian-content programming is a key
20     component to ensuring that Canadians receive a wide
21     range of distinctive Canadian programming that reflects
22     regional perspectives and values, thereby supporting
23     the public interest objectives of the Act.
24  4793                 For the purposes of this discussion,
25     when we refer to western regional production we mean


 1     English language Canadian content television
 2     programming produced and developed by western
 3     independent producers.
 4  4794                 Additionally, we wish to discuss the
 5     implications of a recently released Department of
 6     Canadian Heritage, from the Prairies and Northwest
 7     Territories Region, document entitled "Western
 8     Television Production Study.  I will now ask Susan to
 9     elaborate on the conclusions of the study as she was
10     the consultant commissioned by Canadian Heritage,
11     Prairie Region, to undertake the study.
12  4795                 MS BRINTON:  Thank you.
13  4796                 Attached to our oral brief are
14     highlights from "Western Television Production Study." 
15     The basis for the study was to determine whether
16     western independently produced Canadian content
17     television programming was on the decline.  The source
18     for this study was Telefilm Canada and is based on
19     Canadian-content projects that received Telefilm
20     financing from 1993-94 to fiscal 1997-98.  The study
21     concludes that indeed in the west, Canadian content
22     independent television production has declined over the
23     past five years, and that this is a direct result of
24     the decrease in conventional broadcaster licensing of
25     western Canadian-content productions.


 1  4797                 Some of the specific findings
 2     regarding broadcaster licensing in the west are as
 3     follows:
 4  4798                 CBC's financing of western Canadian
 5     independent television production dropped 51 per cent
 6     between 1993-94 and 1997-98, while dropping only 25 per
 7     cent for their total English language Canadian content
 8     independent production across the same five years.
 9  4799                 Total private conventional
10     broadcaster financing of western independent production
11     dropped 32 per cent from 1993-94 to 1997-98, while
12     decreasing less than 4 per cent for total Canadian
13     English language independent television production
14     during the same period.
15  4800                 Of the private broadcasters, CTV and
16     affiliates in 1997-98 were financing Canadian-content
17     production in the west at almost exactly the same
18     levels as five years previously.  However, in the
19     middle years of the study, from 1994-95 to 1996-97,
20     their numbers dropped to less than half their levels.
21  4801                 CanWest Global posted a steady
22     decline in their Canadian-content independent
23     production financing in the west over the five years of
24     the study, to hit zero by 1997-98.
25  4802                 The Other Private broadcaster


 1     category in the study showed an increase in independent
 2     production financing over the four years from 1993-94
 3     to 1996-97, but again with a drop in 1997-98.  The
 4     majority of this broadcaster financing was attributable
 5     to WIC Western International Communications.
 6  4803                 The pay and specialty broadcasters
 7     significantly increased their financing of western
 8     television from the 1993-94 to 1997-98 period,
 9     primarily in documentary and children's production.
10  4804                 By genre, western Canadian prime time
11     drama production budgets licensed by conventional
12     broadcasters showed the most significant decrease of
13     almost $11 million, or more than 20 per cent, from
14     1993-94 to 1997-98.  In comparison, the numbers for
15     Canadian prime time English language drama production
16     increased 36 per cent.  Notably, documentary and
17     children's programming triggered by pay and specialty
18     broadcasters increased significantly across the five
19     years.
20                                                        1135
21  4805                 The study concludes:
22  4806                 One, broadcaster licence fees are the
23     key to triggering western Canadian content independent
24     television production, and subsequent access to federal
25     funding such as Telefilm Canada and the Canadian


 1     Television Fund.  In general, the overall drop in
 2     conventional broadcaster financing of western Canadian
 3     content production from 1993-94 to 1997-98 resulted in
 4     a corresponding decrease in total western production
 5     levels, especially in prime time drama production.
 6  4807                 Overall, with the pending breakup of
 7     WIC as a western conventional broadcaster, the future
 8     of western Canadian content television production, and
 9     particularly prime time drama production, is
10     predominantly in the hands of the CBC, CanWest Global
11     and CTV/Baton.  Unless these conventional broadcasters
12     make ongoing commitments to western Canadian content
13     production, total western production levels may well
14     continue to decline.
15  4808                 Carole.
16  4809                 MS VIVIER:  As the Broadcasting Act
17     states, programming provided by the Canadian
18     broadcasting system should "be drawn from local,
19     regional, national and international sources" and
20     should "encourage the development of Canadian
21     expression by providing a wide range of programming
22     that reflects Canadian attitudes, opinions, ideas,
23     values and artistic creativity... (and) through its
24     programming and the employment opportunities arising
25     out of its operations, serve the needs and interests,


 1     and reflect the circumstances and aspirations, of
 2     Canadian men, women and children..."
 3  4810                 Regional production and the
 4     development of western Canadian stories for Canadian
 5     television screens is an inherent public interest
 6     objective of the Broadcasting Act.  The Commission has
 7     an obligation to consider that diversity not only
 8     includes issues revolving around linguistic duality and
 9     the multiracial and multicultural nature of Canadian
10     society, but its regional make-up as well.  Therefore,
11     the Commission needs to recognize the importance of
12     regional diversity in Canadian television programming.
13  4811                 We feel this also includes an
14     obligation by all broadcasters, and particularly the
15     CBC as our public broadcaster, to participate in the
16     development of emerging talent, including writers,
17     actors, directors and producers in the west, and to
18     offer existing western talent the opportunity to
19     continue to grow within the Canadian broadcasting
20     system.
21  4812                 Western Canadian television
22     production has benefited over the past number of years
23     from the various transfer of ownership benefits and new
24     licensing commitments of private conventional
25     broadcasters in the west.  Without these commitments it


 1     has become evident that private broadcasters have less
 2     incentive to develop and produce in western Canada.
 3  4813                 CanWest Global in the early 1990s had
 4     a benefit commitment to produce Canadian content
 5     programming in the west.  This commitment expired by
 6     the mid-1990s and, as a result, CanWest Global
 7     triggered zero Canadian content independent production
 8     in the west last year.
 9  4814                 Baton as a station group triggered
10     very little independent production in western Canada
11     until the Commission awarded Baton the much-coveted new
12     Vancouver licence.
13  4815                 Craig Broadcasting, until it was
14     awarded the Alberta licences, triggered minimal
15     production in the west, including Manitoba, its home
16     province.
17  4816                 To quote one broadcaster on the first
18     day of this hearing, "If it gets measured, it gets
19     done".  We would counter, "If it doesn't get measured,
20     it doesn't get done".
21  4817                 In particular in Manitoba, I find it
22     interesting to note that, although the head offices of
23     CanWest Global and Craig Broadcasting are located in
24     Manitoba, over the past few years Manitoba producers
25     have failed to significantly benefit from this. 


 1     Additionally, the CTV affiliate in Winnipeg is not
 2     owned by Baton but by Moffat Communications, and
 3     therefore Manitoba has not benefitted from the
 4     Baton/CTV commitments.  In fact, Baton's flagship prime
 5     time Canadian drama series "Cold Squad" is not
 6     televised in the Winnipeg market.
 7  4818                 CBC has also not been active player,
 8     evidenced by the fact that they only licensed one low-
 9     budget documentary in Manitoba last year.
10  4819                 Manitoba-based companies have been
11     forced to look to foreign service production to
12     survive.  I am certain Manitoba producers would like
13     more opportunities to tell their stories to Canadian
14     audiences.
15  4820                 In conclusion, our overall
16     recommendation is that the Commission must include
17     requirements for all broadcasters, and specifically
18     conventional broadcasters, to commit to ongoing
19     regional development and production, and that these
20     commitments should be reviewed at the corporate
21     licensing renewal level.  The future of the western
22     independent production community depends on it.  How do
23     broadcasters know they are getting the best if they are
24     not actively looking for the best in Canadian
25     programming by spending time and resources in the


 1     regions and in particular western Canada?
 2  4821                 Thank you for the opportunity to
 3     present our views, and we are now prepared to answer
 4     any questions that you may have.
 5  4822                 Thank you.
 6  4823                 THE CHAIRPERSON:  Thank you, ladies.
 7  4824                 Commissioner Wilson.
 8  4825                 COMMISSIONER WILSON:  Good morning.
 9  4826                 I wonder if, before I start asking
10     some specific questions, you could just tell me a
11     little bit more about the fund, how much money is in
12     it, how do producers access it, how long has it been --
13     I think you said it has been in existence since 1987. 
14     Is that when it started?
15  4827                 MS VIVIER:  The provincial fund in
16     Manitoba?
17  4828                 COMMISSIONER WILSON:  The provincial
18     fund,  yes.
19  4829                 MS VIVIER:  Our funds have been --
20     1985-86 was the first fiscal year.  We have equity
21     money, we have development money and we now also have a
22     tax credit, and we have a special loan program, which
23     really acts as an interim financing fund.
24  4830                 It is for any genre of production,
25     whether it be feature films, television movies,


 1     documentaries, children's and, like most funds in
 2     Canada, including Telefilm, a critical trigger is a
 3     broadcaster.  It is investment money, and there is no
 4     point in investing if they don't have a market or
 5     viewership.  So the broadcasters are a very key
 6     component to this.
 7  4831                 What I have been noticing over the
 8     last couple of years is the drop-off of Telefilm and
 9     the CTCPF money that we are accessing.  And it is not
10     that Telefilm is turning down projects, or the CTCPF --
11     or, I guess, CTF Fund, I don't know; all these
12     acronyms -- but that in fact the broadcasters are not
13     being triggered.  Hence our presentation today.
14  4832                 COMMISSIONER WILSON:  How much is
15     your fund worth?
16  4833                 MS VIVIER:  The tax credit this year
17     is probably going to represent about $4 million.  We
18     have $1 million interim loan and we have $1.2 million
19     for equity on an annual basis.
20  4834                 COMMISSIONER WILSON:  Great.
21  4835                 Do you work with the Canadian
22     Television Fund?  Are you in contact with them?  Do you
23     monitor their activities?  I am just wondering if there
24     is any kind of relationship between the provincial
25     funding organizations and the Canadian Television Fund.


 1  4836                 MS VIVIER:  Yes, absolutely. 
 2     Actually, the Canadian provincial agencies, we are an
 3     association and we have regular meetings with the Cable
 4     Fund and the Canadian Television Fund and with
 5     Telefilm, and these are concerns across the country,
 6     actually, the access to funding.
 7  4837                 We understand the funding is limited,
 8     there is never going to be enough money to go around
 9     for everybody, and people are doing other things to do
10     production, whether it be service production or co-
11     productions.  I just have to come back to, if I feel
12     that broadcasters -- even us, as the Canadian viewer,
13     are not out actively looking into the independent
14     community across the country, looking for the best. 
15     How do we know we are getting it on television?  And I
16     feel the Canadian content funds and broadcasters have a
17     responsibility to reflect the country.
18  4838                 COMMISSIONER WILSON:  In your
19     submission, on pages 1 and 2 of your written
20     submission, you talk about the development of the
21     Manitoba independent production sector and state that
22     it was significantly stimulated by various transfer of
23     ownership benefits put forward by private broadcasters
24     in the early 1990s.  You talk, in the written
25     submission and again today in your oral submission,


 1     about the noticeable drop in levels of regionally
 2     developed and produced television production activity
 3     across the west and about the fact that the benefits
 4     expire mid-nineties, and some of them coming up.
 5  4839                 Are you suggesting that -- well, I
 6     guess you are suggesting that there be some kind of
 7     extended expenditure requirement for these broadcasters
 8     with a specific regional focus.
 9  4840                 MS VIVIER:  I don't know that I am
10     actually asking for an expenditure.  Again, I think
11     they have to be accountable that they are responding to
12     the regions of this country, that they are not just
13     working in certain sectors and that true, honest effort
14     is made to go out and meet the creative talent in the
15     country to again maintain that they are getting the
16     best production.
17  4841                 So, you know, I don't want to be
18     politically correct and say they have to do, you know,
19     a television movie here and a television movie there. 
20     It really should be based on the quality of the
21     project, but you don't know that you are getting the
22     quality of projects unless you are actively searching.
23  4842                 COMMISSIONER WILSON:  I am just
24     wondering what you think the best way is of encouraging
25     them to do that.  Is it through some regulatory


 1     mechanism or --
 2  4843                 MS VIVIER:  I think, when they come
 3     back up for renewals, it is really -- look at a history
 4     of what they have done in the time coming up and after
 5     their commitments expired.  I think that is quite
 6     telling.  Our experience is they performed when the
 7     commitment was there, and when the commitment expired
 8     it dropped off.
 9  4844                 So I think the CRTC, the Commission,
10     can be looking at that at time of renewals.
11  4845                 MS BRINTON:  Just in general,
12     underlying the whole submission, it is not that we are
13     requiring or asking the CRTC to do specific regulatory
14     incentives in terms of spending or hours or allocations
15     to the regions.  What we are asking for is, the CRTC is
16     in a position where they can make it clear to the
17     broadcasters that one of the things they will be
18     looking at at licence renewals, and particularly if you
19     move to group licensing renewals, is that regional
20     production and diversity in their programming and the
21     programming that they license from the independent
22     production sector will be reflective of the country, it
23     will not all be based in one region or the other.
24  4846                 So once broadcasters I think are
25     served notice that they will be accountable at some


 1     point in the renewal process in terms of regional
 2     production, I think they will then make an effort to go
 3     forward in future endeavours to ensure that they have a
 4     regional balance.
 5  4847                 COMMISSIONER WILSON:  Some of the
 6     educational broadcasters that we have heard from this
 7     week have suggested that a portion of the Canadian
 8     Television Fund be allocated for the educational
 9     programming genre.  I think you also talked about
10     documentaries in your submission.  I think they also
11     suggested that there be some regional requirements
12     attached to that.
13  4848                 I am just wondering -- I would just
14     like to pick your brains a bit -- what your views are
15     on that approach.  Do you think that that would help
16     your goals if there were a portion of the fund that was
17     set aside specifically for regional programming?
18  4849                 MS VIVIER:  I think objectives and
19     targets should definitely be set by the funds, whether
20     it be Telefilm or the Canadian Television Fund, for
21     outside of the centre of Canada for production.  I
22     don't think that's an unreasonable thing to expect.
23  4850                 I think they attempt to do that
24     somewhat now.  Again, it is not so much their funding,
25     it is the difficulty in triggering the broadcasting to


 1     get their funding in the first place.  It is hard to
 2     measure without having the triggers.
 3  4851                 COMMISSIONER WILSON:  I guess the
 4     next thing that I want to do with you is just sort of
 5     explore the whole notion of regional, because you are
 6     from Manitoba Film & Sound, we will talk to Alberta
 7     later today, and then the study that you submitted as
 8     part of your submission is a regional study, the
 9     Prairies and the Northwest Territories.
10  4852                 I am wondering if you think that
11     taking a regional approach -- I am sort of thinking
12     this through as I go.  Should we be looking at taking a
13     regional approach where we would take into
14     consideration the level of productions that are done in
15     a region like Manitoba, Saskatchewan, Alberta and the
16     Northwest Territories?
17  4853                 We have had a couple of definitions
18     of "region" offered to us.  I think the Friends of
19     Canadian Broadcasting suggested that eastern Ontario
20     was a region and the Golden Horseshoe is a region. 
21     Then we look to you, and three provinces and a
22     territory are a region.
23  4854                 What is going to help us decide how
24     much should go where?
25  4855                 MS BRINTON:  Just for the record, the


 1     study itself, although it was triggered by the Prairies
 2     and Northwest Territories Region of the Department of
 3     Canadian Heritage, covers the four western provinces
 4     only:  British Columbia, Alberta, Manitoba and
 5     Saskatchewan, all four western provinces.  For the
 6     purposes of this debate, we are discussing the four
 7     western provinces as a region.
 8  4856                 Additionally is a comment I think --
 9     I mean, you can split hairs infinitely in terms of what
10     is a region and what isn't, but I think there is a lot
11     of logic in terms of looking at the west as a region. 
12     It is historically a region.  So I think there is
13     validity in determining that there is a difference of
14     opinion that exists in the west versus central Canada
15     versus eastern Canada.
16  4857                 I don't think we are advocating here
17     that you split Manitoba, Saskatchewan, Alberta and
18     British Columbia separately as little mini regions
19     within that.  We just have the position that, overall,
20     we would like to see the Commission include regional
21     diversity as a component of diversity in the Canadian
22     broadcasting system and that at some point broadcasters
23     should be made accountable for their regional
24     diversity.
25  4858                 We are not advocating it only has to


 1     be the west; it is just we don't want to see, and
 2     particularly in the study, prime time drama produced
 3     only out of central Ontario or only where broadcasters
 4     have conditions of licence to do that kind of drama. 
 5     We would like to see a little more balanced approach by
 6     broadcasters in terms of how they reflect Canadians to
 7     themselves, especially the larger multistation
 8     ownership groups; in fact you have two private sector
 9     networks now that should be expected to rise to that
10     challenge.
11  4859                 COMMISSIONER WILSON:  When you were
12     doing the study, did you disaggregate the numbers?  Did
13     you go province by province?  Because, of course, there
14     is a huge level of production in British Columbia which
15     would skew the figures away from the results in the
16     other three provinces.
17  4860                 MS BRINTON:  Absolutely.  There were
18     a couple of interesting dynamics in the study.  The
19     overall first part of the study was to look at the west
20     as a group in comparison to Canada, and the first
21     couple of charts that are attached to the oral
22     presentation show the west as a percentage or Canada.
23  4861                 The second part of the study was to
24     simply look at the west as a component and say, okay,
25     in western Canada, look at the genres by drama,


 1     documentation, music, variety and children's see where
 2     the production is falling off, and also to look at it
 3     by province, which province is benefitting, which one
 4     isn't.
 5  4862                 In terms of provincial requirements,
 6     British Columbia started at a high in 1993-1994,
 7     dropped enormously during the middle years, and at the
 8     end, in 1997-98, reached another plateau.  That plateau
 9     is directly attributable to Baton having the new
10     licence in Vancouver and the production of "Cold Squad"
11     there.
12  4863                 Alberta, with the demise of the MPDC
13     a few years ago, their production levels went straight
14     down the tubes.  They lost "North of 60" and they lost
15     "Jake and the Kid", two big prime time drama series. 
16     So they went significantly down.
17  4864                 Manitoba and Saskatchewan both
18     operated at a level of less than $10 million, and it
19     was very sporadic.  But neither one of them have had a
20     significant prime time drama series produced in their
21     province, and that has a tendency to keep their numbers
22     down.  It was one-offs or children's series or that
23     kind of thing.
24  4865                 So, individually, those are how the
25     provinces kind of stack up.


 1  4866                 The private broadcasters as well as a
 2     group skewed differently.  CTV did a loop like this at
 3     the beginning of 1993-94, primarily the CTV affiliates
 4     in Alberta, Electrohome and various assorted
 5     ownerships, during that time period up, before they
 6     were ultimately Baton.
 7  4867                 So the independent CTV affiliates in
 8     Alberta played a larger role at the beginning and
 9     dropped off.  Baton had no significant involvement in
10     the west again until 1997-98 with the development from
11     the Vancouver station.
12  4868                 CanWest Global, with their conditions
13     of licence in 1993-94, primarily their Vancouver
14     station, had a production level that started high and
15     then dropped to zero by 1997-98.
16  4869                 The private broadcasters, the other
17     category, the general one, kind of did a blip in the
18     middle, and that was primarily WIC and probably
19     attributable a bit to the problems that they had in the
20     middle years of the study, so they went like this.
21  4870                 So overall the private broadcaster
22     category is flat.  While they increased overall in 
23     Canada in their spending, it stayed flat as a total
24     category of conventional broadcasters across the
25     Prairies.  But, if you look at them individually, some


 1     went up, some went down and some dipped in the middle
 2     just to make it flat.
 3  4871                 Is that clear?  Have I confused the
 4     issue?  I would be happy to answer written questions to
 5     this afterwards.
 6  4872                 COMMISSIONER WILSON:  Could you file
 7     a copy of the entire study with all of the
 8     disaggregated numbers?
 9  4873                 MS BRINTON:  Absolutely, yes.
10  4874                 COMMISSIONER WILSON:  That would
11     probably help.
12  4875                 MS BRINTON:  Okay.
13  4876                 COMMISSIONER WILSON:  That's great.
14  4877                 I want to ask you a couple of
15     questions, actually, with respect to -- I don't know if
16     you have read the Alberta Motion Picture Industry
17     Association's paper, but they have a suggestion here
18     that says:
19                            "We recommend that regional
20                            productions be given a 50 per
21                            cent bonus when the CRTC
22                            calculates the hours of Canadian
23                            programming in the under-
24                            represented categories
25                            broadcasted by a Canadian


 1                            broadcaster towards a condition
 2                            of licence."  (As read)
 3  4878                 Do you think that would be an
 4     effective mechanism for triggering more regional
 5     production?
 6  4879                 MS BRINTON:  I think it would be
 7     useful.  Certainly, anything that provides an incentive
 8     makes a difference.  So 150 per cent credit regional
 9     component -- I know Great North Productions, who is
10     coming up before you towards the end of the hearing,
11     has offered a kind of regional 50 per cent credit
12     within the 150 per cent -- all these percentages
13     rolling.  But I think that anything that provides an
14     incentive to broadcasters to increase or at least to
15     look at the regions as a viable source of programming
16     is useful.
17                                                        1155
18  4880                 COMMISSIONER WILSON:  I think those
19     are all of my questions for you this morning.  I don't
20     know if any of my colleagues have questions.
21  4881                 THE CHAIRPERSON:  Commissioner
22     Cardozo?
23  4882                 COMMISSIONER CARDOZO:  Thanks very
24     much, Madam Chair.
25  4883                 Thank you very much for your


 1     presentation.  The message you bring about regional
 2     diversity and seeing more of the regions on our screen
 3     is one that we have heard quite a bit about.  So, you
 4     are in a lot of company and we are hearing the message
 5     quite clearly.
 6  4884                 Commissioner Wylie and myself were at
 7     the round table in Winnipeg in June and certainly heard
 8     the message from your fellow citizens there, as we have
 9     elsewhere.  Earlier this week we heard from
10     representatives from Saskatchewan and British Columbia
11     as well on that, so I think we are hearing quite well
12     and I guess what we are looking for is what do we do
13     about it.  We appreciate some of the suggestions you
14     have made in terms of goals and objectives, providing
15     incentives, if you don't count it, it won't happen, the
16     Commission should require it, and so forth.
17  4885                 But I do want to ask you about the
18     issues of cultural diversity as well with regards to
19     Manitoba and ask for some sense about whether this sort
20     of approach has worked looking at diversity.  I am
21     thinking of the population of Manitoba, which probably
22     has as dynamic a diversity as any in this country where
23     you have a significant francophone population, you have
24     a significant aboriginal population especially growing
25     in the cities and you have a multicultural population


 1     that goes back a century, as well as with older groups,
 2     like people from Ukraine and Germany, and then newer
 3     groups like Filipinos in more recent times.
 4  4886                 Have you looked at how you reflect
 5     those aspects of diversity, francophones, aboriginal
 6     people and other ethnic and cultural diversity, and
 7     have you done any setting of targets or counting of how
 8     much you have done?
 9  4887                 MS VIVIER:  It's an interesting
10     question.  We are not the producers, so again we rely
11     on the production community, but we have done outreach
12     programs.  We do work with aboriginal filmmakers,
13     francophone filmmakers, and I think the programming
14     that has been produced in Manitoba has been quite
15     diverse.  It's interesting that you are raising the
16     francophone filmmakers because they have difficulty,
17     which will come up at the CBC's renewal, I believe,
18     with Radio-Canada in getting licences for their French-
19     language projects.  That's another hearing, but that is
20     an issue for them as well.
21  4888                 We are currently undertaking a
22     francophone documentary series and we have done a few
23     co-productions with Quebec.  So, yes, that's very
24     important.  We have other facilities in Winnipeg, the
25     Winnipeg Film Group and Video Pool.  The National


 1     Screen Institute has now emerged into Winnipeg --
 2     expanded into Winnipeg as well and through their
 3     student programs and even drama prize, again those are
 4     opportunities to reach into the more diverse
 5     communities to have an entry level in to start to
 6     develop a program and we are also, through the NCI,
 7     looking to work with schools more to also develop the
 8     talent.
 9  4889                 COMMISSIONER CARDOZO:  So, in terms
10     of outreach, you are going out and talking to fledgling
11     producers and that type of thing?
12  4890                 MR. VIVIER:  Yes, we do hold forums
13     and the Producers Association also does a lot of that
14     themselves, MMPIA and the National Screen Institute. 
15     It's coming from various directions, but we do attend
16     the college when they have the high school -- what do
17     they call that -- the school week in the winter for
18     kids to look for different careers.  We do attend that
19     and make sure our information is getting out there as
20     well.
21  4891                 COMMISSIONER CARDOZO:  The projects
22     that you fund there, they are eligible for CTF funding
23     as well?
24  4892                 MS VIVIER:  Yes.
25  4893                 COMMISSIONER CARDOZO:  Are you aware


 1     of the aboriginal program within CTF?
 2  4894                 MS VIVIER:  Yes, I am.
 3  4895                 COMMISSIONER CARDOZO:  I believe they
 4     set aside $1 million.
 5  4896                 MS VIVIER:  Yes.
 6  4897                 COMMISSIONER CARDOZO:  Do you know if
 7     any of your recipients have been able to access that
 8     fund?
 9  4898                 MS VIVIER:  We have one project right
10     now which we are in development with that should be
11     able to move on and access that.  So, we are tracking
12     right now.
13  4899                 COMMISSIONER CARDOZO:  Okay, thanks
14     very much.
15  4900                 MS VIVIER:  Thank you.
16  4901                 COMMISSIONER CARDOZO:  Thank you,
17     Madam Chair.
18  4902                 THE CHAIRPERSON:  Thank you very much
19     and we hope you have a good trip back.
20  4903                 Madam Secretary, would you invite the
21     next participant, please?
22  4904                 MS BÉNARD:  Thank you, Madam Chair. 
23     The next presentation will be by Alberta Motion Picture
24     Industries Association and I would invite them to come
25     forward.


 1  4905                 THE CHAIRPERSON:  Good morning, Ms
 2     Edwards.  Go ahead when you are ready.
 4  4906                 MS EDWARDS:  Good morning, Madam
 5     Chair, Commissioners, ladies and gentlemen.  I would
 6     like to start with a little anecdote for you.  Late one
 7     winter's evening last year when the big Canada-Czech
 8     hockey game was being played, my teenage son came down
 9     and approached me and asked to stay up to watch the
10     game on television.  I am a mom, so I reminded him that
11     school was on in the morning and suggested that he
12     should get some sleep.  But I turned on the set and I
13     settled in upstairs to watch the game.
14  4907                 When Canada scored the tying goal
15     late in the third period, I let out a whoop and somehow
16     in the back of my head I had this niggling mother's
17     instinct and I thought I had better check on my boy
18     downstairs.  Sure enough, there was a light shining
19     from underneath his door and I could hear the
20     television.  I opened the door and, to my surprise,
21     there he was doing the dance of joy wrapped in the
22     Canadian flag.  I looked at him and said, "Matt, what
23     are you doing?"  He said, "Mom, I am proud to be a
24     Canadian."
25  4908                 I am also very proud to be a Canadian


 1     and I appear before you today as an independent
 2     producer to represent the Alberta Motion Picture
 3     Industry Association.  AMPIA has represented
 4     independent producers in this province for the past 26
 5     years.  The mandate of the Association is to ensure the
 6     growth and development of the independent production
 7     industry.  Central to this mandate is maintaining an
 8     environment in which producers can initiate, develop
 9     and produce films over which they have creative
10     control.
11  4909                 AMPIA membership eligibility has now
12     been widened to include Alberta broadcasters,
13     exhibitors, cable companies, public agencies,
14     foundations, guilds, associations, unions, performers,
15     writers, directors, service providers, craftspeople,
16     distributors, support staff, arts/co-op associations,
17     training institutions and students.  In all, there are
18     over 260 organizations and individuals who are members
19     of AMPIA.
20  4910                 I would like to speak about Canadian
21     programming and shelf space for Alberta programming. 
22     We submit that Canadians want to view Canadian
23     television programming.  We believe that our Alberta
24     voice plays an important part in reflecting the
25     cultural diversity and variety of this country.


 1  4911                 Alberta must continue to have a
 2     strong voice in the telling of Alberta's stories,
 3     crafted and controlled by Alberta talent.  The
 4     endurance of programs like "North of 60" and the
 5     popularity of "Jake and the Kid", "Mentors", "Bye Bye
 6     Blues", "The Orange Seed Myth" and others provide proof
 7     that the Canadian public enjoys the stories that we
 8     have to tell.
 9  4912                 Earlier this year we randomly chose a
10     week and checked through the local television guide for
11     Canadian programs during prime time.  Not only is there
12     a limited amount of Canadian programming during prime
13     time on all the Canadian channels, but Alberta programs
14     in national broadcast slots are either rare or non-
15     existent.  This did not, unfortunately, come as a
16     surprise to us, that finding shelf space for Alberta
17     programs on a national level is a challenge.
18  4913                 It is becoming increasingly difficult
19     in Alberta as there is an increase in multi-station
20     ownership headquartered outside of Alberta. 
21     Programming decisions are no longer being made in our
22     province.  Our voices and our stories are in danger of
23     being lost.  An Alberta award-winning documentary has
24     trouble receiving shelf space on a national level.
25  4914                 Further, in Alberta we currently face


 1     a situation where at some stations the only air time
 2     that is available for our programs is the back half-
 3     hour of the news hour every statutory holiday.  We
 4     despair that soon we will have nothing but rebroadcast
 5     stations and we do not believe that this meets the
 6     spirit of public interest under the Broadcast Act and
 7     certainly does not reflect the federal nature of this
 8     country.
 9  4915                 We have a recommendation.  To
10     stimulate a more balanced view on our television
11     screens in addition to the regional bonuses currently
12     available to producers under the Canadian Television
13     Fund, which really makes a difference to us in Alberta,
14     we recommend that regional productions be given a 50
15     per cent bonus when the CRTC calculates the hours of
16     Canadian programming in the under-represented
17     categories broadcast by a Canadian broadcaster toward
18     their condition of licence.
19  4916                 We move on to promotion of Canadian
20     programming.  So, how do we encourage Canadians to
21     watch our programs?  Unlike our counterparts in the
22     United States, there is little or no budget for
23     producers to promote a Canadian program once it is
24     made.  All the resources go into the successful
25     completion of the program.  We submit that broadcasters


 1     should be encouraged to commit to seriously promote
 2     Canadian programming through more than just five-second
 3     bumpers.
 4  4917                 Our broadcasters have long maintained
 5     that Canadian programming does not generate the kind of
 6     revenues or viewership that American programming does. 
 7     At the end of the day, it is how many viewers they can
 8     deliver and the ranking in the BBMs that will dictate
 9     the price they can ask for advertising space.  We
10     submit that if Canadian and further regional
11     programming were properly promoted by the broadcasters,
12     viewership should increase, resulting in increased
13     advertising revenue from the commercial slots that
14     surround Canadian programming.  We submit that we can
15     help the broadcasters achieve their goals by providing
16     world class, international award-winning programming
17     for their viewers.
18  4918                 According to Statistics Canada, in
19     1996 in Alberta $182 million were generated by the
20     broadcasters in advertising revenues.  As the
21     headquarter ownership of Alberta stations moves out of
22     Alberta and there is a dramatic increase in multi-
23     station ownership, so go the profits out of Alberta. 
24     At the same time, broadcasters are required to allocate
25     certain formula-based expenditures on Canadian


 1     programming without having to necessarily invest any of
 2     those expenditures in Alberta where they operate and
 3     collect major advertising revenues.  AMPIA supports
 4     completely a formula-based approach.  We submit that it
 5     could be strengthened to enhance the broadcast of
 6     programs from the regions and to put production dollars
 7     back into the communities which are contributing major
 8     advertising revenues.
 9  4919                 Recommendation number two.  We
10     recommend that the CRTC strengthen its formula-based
11     Canadian programming expenditure requirements by
12     requiring that broadcasters commit a significant
13     percentage to the purchase of prime time Canadian
14     programming from the market in which they are deriving
15     advertising revenue -- in our case, Alberta -- and
16     purchase this programming from the independent
17     production sector.  This should be in addition to the
18     incentives that the broadcasters give to independent
19     producers in Schedule F of the CRTC application.
20  4920                 We further recommend that in return
21     for the promotion of Canadian programs on a national
22     basis broadcasters be permitted to count one-half hour
23     of promotional programming, programming that promotes
24     Canadian programs, towards meeting their 10 hours per
25     week of under-represented program categories and that


 1     the spending on that promotion count as Canadian
 2     program expenditures.
 3  4921                 We applaud the Commission for
 4     initiating this process and thank you for allowing us
 5     the opportunity to participate in this very important
 6     consultation.
 7  4922                 THE CHAIRPERSON:  Ms Edwards,
 8     although your organization refers to motion pictures, I
 9     see from your presentation this morning that the
10     membership eligibility is very expanded.  Does it
11     remain, however, focused on motion pictures in the
12     traditional sense or any type of programming?
13  4923                 MS EDWARDS:  I'm sorry, I am not sure
14     I quite understand.
15  4924                 THE CHAIRPERSON:  You are called the
16     Alberta Motion Picture Industries Association.
17  4925                 MS EDWARDS:  Yes.
18  4926                 THE CHAIRPERSON:  So, I suspect you
19     have been focusing on motion pictures in the
20     traditional sense --
21  4927                 MS EDWARDS:  Yes.
22  4928                 THE CHAIRPERSON:  -- or any type of
23     programming.  Long-form motion pictures?
24  4929                 MS EDWARDS:  Long form and
25     television.


 1  4930                 THE CHAIRPERSON:  But motion pictures
 2     rather than short programming or series or --
 3  4931                 MS EDWARDS:  No, we cover all the
 4     sectors.
 5  4932                 THE CHAIRPERSON:  You cover all?
 6  4933                 MS EDWARDS:  Yes, we do.
 7  4934                 THE CHAIRPERSON:  Because the name is
 8     somewhat misleading.  You are using "motion picture" as
 9     very generic, not a special forum.
10  4935                 MS EDWARDS:  Yes.
11  4936                 THE CHAIRPERSON:  And it has been
12     emphasized clearer than it was in your written
13     presentation because you have expanded technically the
14     membership possibility to represent 260 organizations
15     and individuals who are now members.
16  4937                 MS EDWARDS:  Yes.  We predominantly
17     still -- most of our members are producer members,
18     independent producer members.
19  4938                 THE CHAIRPERSON:  You are focusing on
20     prime time regional product and at the end of your
21     presentation this morning you referred to the 10 hours
22     per week.  I suspect that you are endorsing the CFPTA's
23     10/10/10 formula.  Where did you get the 10 hours, from
24     the CFPTA's submission?
25  4939                 MS EDWARDS:  We certainly read that


 1     submission and incorporated that particular part into
 2     our recommendation.  We are very intent on stimulating,
 3     as you can tell, Alberta representation on a
 4     national --
 5  4940                 THE CHAIRPERSON:  So, you feel that
 6     the first step is to stimulate the under-represented
 7     categories.  Are you also endorsing the peak time
 8     aspect of that 10 hours, that 10/10/10 formula that was
 9     put forward?
10  4941                 MS EDWARDS:  In terms of the --
11  4942                 THE CHAIRPERSON:  Well, if you
12     recall, they recommended 10 per cent of the revenues of
13     the previous year, 10 hours per week, plus three for
14     children, and all of that in peak time, if I recall
15     properly, defined as 7:00 to 11:00.
16  4943                 MS EDWARDS:  Certainly, we would be
17     in agreement with the 7:00 to 11:00.  I would have to
18     consult with my colleagues.  I'm sorry, our Executive
19     Director was not able to come.
20  4944                 THE CHAIRPERSON:  As to whether you
21     also think it has to be within a particular time period
22     over and above the exhibition.
23  4945                 MS EDWARDS:  I believe we would
24     support the 7:00 to 11:00, yes.
25  4946                 THE CHAIRPERSON:  What was I going to


 1     ask you?  You also refer to a bonus instead of using a
 2     credit, Recommendation 1.  How would this work?  Would
 3     the 50 per cent bonus, in your view, be tantamount to a
 4     200 per cent credit?  Is it like if you did one hour of
 5     Canadian programming in the under-represented
 6     categories that came from a region, that would count as
 7     though you had done two hours?  Is that how it would
 8     work?
 9  4947                 MS EDWARDS:  No, I think that would
10     be an hour and a half.
11  4948                 THE CHAIRPERSON:  So, it would be
12     more like the 150 per cent credit because it's
13     addressed from the bonus rather than the credit.
14  4949                 MS EDWARDS:  Yes.
15  4950                 THE CHAIRPERSON:  That bonus would be
16     by reference to who the producer is --
17  4951                 MS EDWARDS:  Yes.
18  4952                 THE CHAIRPERSON:  -- whether he or
19     she is an Alberta producer operating in Alberta?
20  4953                 MS EDWARDS:  Yes.
21  4954                 THE CHAIRPERSON:  You also emphasize
22     promotion and so have a number of parties.  You endorse
23     the half hour, which appears to be the CFPTA -- the
24     half-hour promotional program a week that could go
25     towards being Canadian.  Do you have any comments on


 1     how one would define what's an acceptable or eligible
 2     promotional half hour?
 3  4955                 MS EDWARDS:  I think in that instance
 4     I would like to take that back and present a written
 5     answer to that question, if I could consult with my
 6     colleagues on that.
 7  4956                 THE CHAIRPERSON:  You don't recall
 8     discussing some of the other CAB promotional proposals
 9     which would go to exempting from the definition of
10     "advertising" certain promotional efforts?
11  4957                 MS EDWARDS:  We have not thoroughly
12     discussed that.
13  4958                 THE CHAIRPERSON:  You didn't.  You
14     obviously would have -- well, let me rephrase this. 
15     Would you have a concern that promotional programming,
16     if it were more than one-half hour and also the bonus,
17     would have the effect of reducing the amount of actual
18     produced product or programming?
19  4959                 MS EDWARDS:  That certainly would be
20     a concern.  I think our larger concern at this point is
21     stimulating getting our programming out onto a national
22     basis and attracting viewership promoting that
23     programming.  So, perhaps this could be the first step
24     toward achieving that goal.
25  4960                 THE CHAIRPERSON:  Your concern is


 1     more what is the ratio of money or exhibition hours
 2     that goes to Alberta producers or the shelf life given
 3     for exhibition of Alberta products than the actual
 4     amount.  So, obviously, if it's a ratio, the more is
 5     required in terms of Canadian content, the more Alberta
 6     producers could benefit from it.
 7  4961                 MS EDWARDS:  Yes.
 8  4962                 THE CHAIRPERSON:  Has your
 9     organization tried to pressure broadcasters?  Do you
10     have an organized public relations attempt to get
11     Alberta broadcasters to invest more in Alberta
12     production?  I see in your oral presentation you say:
13                            "...broadcasters are required to
14                            allocate certain formula-based
15                            expenditures on Canadian
16                            programming without having to
17                            necessarily invest any of those
18                            expenditures in Alberta where
19                            they operate and collect major
20                            advertising revenues."
21                                                        1215
22  4963                 I suspect what you are saying is that
23     you are making your money in Alberta.  It does not
24     matter where your headquarters are, because you appear
25     to be concerned about the movement of ownership, as


 1     well.
 2  4964                 MS EDWARDS:  Yes, we are concerned
 3     about that.
 4  4965                 THE CHAIRPERSON:  Have you tried to
 5     say:  "This is how much money you are making out of
 6     Alberta.  How much money are you putting back into
 7     Alberta?"
 8  4966                 MS EDWARDS:  We are currently doing
 9     studies on that issue.  Through our written
10     presentation, we make note of the various production
11     and development funds that are available through the
12     various broadcasters.
13  4967                 However, it is just not enough to
14     stimulate the kind of programming we believe can be
15     coming out of our province.  And it does not
16     necessarily guarantee us national play.
17  4968                 That is the biggest point that we are
18     trying to emphasize.
19  4969                 THE CHAIRPERSON:  You want money put
20     into Alberta production that will have national play.
21  4970                 MS EDWARDS:  Yes.  As my colleagues
22     in Manitoba were saying, it is important for the
23     broadcasters to move across the country and see who the
24     other players are across the country.  We believe we
25     have very talented award-winning people in Alberta and


 1     believe we have very strong stories to tell that would
 2     reflect a part of Canada to Canadians.  We want to be
 3     given the opportunity to produce that kind of
 4     programming; and further to just producing the
 5     programming, have it be seen on a national basis.
 6  4971                 THE CHAIRPERSON:  In that sense, do
 7     you think that concentration of ownership, instead of
 8     being a problem, may be a help?
 9  4972                 If you want regional productions -- I
10     see some of your Manitoba colleagues raising their
11     eyebrows here -- in the sense that if you want national
12     play but you want it produced by Alberta producers,
13     isn't it easier with fewer ownership groups to get
14     national exposure?
15  4973                 MS EDWARDS:  It should be.  I don't
16     believe that that is necessarily the case.
17  4974                 THE CHAIRPERSON:  Why not?  For
18     example, if somebody from anywhere in Canada owns
19     stations in a number of places, but you can convince
20     them that because a ratio of their advertising revenues
21     is as a result of broadcasting in a particular region,
22     you could still pass on the regional argument. But
23     wouldn't it be easier to get the national exposure?
24  4975                 MS EDWARDS:  In theory, yes.  That
25     certainly has not been our experience.  That was a


 1     concern that we raised about some of the time slots
 2     that are available to us.  They are just not there.
 3  4976                 THE CHAIRPERSON:  For example, if you
 4     managed to convince the CBC that they should spend
 5     money in the regions, you would have a better chance of
 6     having national exposure because of the fact that they
 7     are broadcasting across the country.
 8  4977                 MS EDWARDS:  If the national --
 9  4978                 THE CHAIRPERSON:  If that happened,
10     yes.
11  4979                 MS EDWARDS:  -- broadcaster agrees
12     that our program will fit into their programming
13     schedule.  That is the difficulty.
14  4980                 THE CHAIRPERSON:  And many factors
15     come into it here.  I was just addressing your comment
16     about when an undertaking's ownership moves out of the
17     province; that that is a disadvantage.
18  4981                 It could be turned into an advantage
19     is what we will hear, I am sure, from those parties.
20  4982                 MS EDWARDS:  Yes.  And certainly we
21     will be there making that representation.
22  4983                 It is not always as easy as that. 
23     The broadcasters obviously have their own desires and
24     needs, and we are certainly vocal in expressing what we
25     would like to see.


 1  4984                 THE CHAIRPERSON:  You would have to
 2     twist their arm or help the Commission to do so when
 3     these occur.
 4  4985                 I don't know if you want your
 5     Manitoba colleagues to return and answer this question.
 6     They seem to be quite animated.
 7  4986                 Is that okay with you, Ms Edwards?
 8  4987                 MS EDWARDS:  That would be fine.
 9  4988                 THE CHAIRPERSON:  Ms Vivier, it is
10     this particular question of how you relate regional
11     participation and ownership, especially when your aim
12     is not to have local programming but nationwide
13     exposure.
14  4989                 MS VIVIER:  One would think, with the
15     broadcasters getting larger, that you would benefit
16     from that.  Clearly, we have not.
17  4990                 I think by what we stated -- even
18     having the head offices of the major broadcasters in
19     the province, I am told all the time:  "You guys are
20     okay in Manitoba.  You have the head office of Canswest
21     Global and you have Moffat Communications and Craig." 
22     And I laugh and say:  "That doesn't help us at all."
23  4991                 As far as efforts go, it is not like
24     we sit on our hands and have not tried to have this
25     conversation with the broadcasters.  There have been


 1     many conversations with broadcasters on these issues
 2     and also dealing with Canwest.
 3  4992                 When Canwest had a condition of
 4     licence in Vancouver, at CKVU, there was wonderful
 5     programming going on for the four western provinces.
 6     They were licensing high end documentaries.  "The Curse
 7     of the Viking Grave", a television movie that was made
 8     in Manitoba, a Canadian movie, was up for an Emmy
 9     award.
10  4993                 There was wonderful programming being
11     produced.  At that time, I was more than happy to
12     provide a letter of intervention for Canwest at the
13     CRTC hearings.  Well, I certainly would not provide a
14     letter for them now.
15  4994                 I think the transfer of ownership is
16     a major issue, and that is when you can get them and
17     make them come up to the table.  Canwest Global is one
18     of the most profitable companies, and I think it is
19     quite shameful that they have not spent one penny on
20     western Canadian independent production in 1997-98.
21  4995                 THE CHAIRPERSON:  We will leave it at
22     that.  It is easy to go down the slippery slope of
23     going beyond the purpose of this hearing, although
24     sometimes it is very difficult to discuss issues
25     without getting into specifics.


 1  4996                 We did say at the beginning of the
 2     hearing that we would try to keep the processes
 3     separate.
 4  4997                 I am sure that legal counsel will be
 5     raising his eyebrows at me and will get animated if we
 6     go beyond that.
 7  4998                 We thank all of you.
 8  4999                 Ms Edwards, I don't know if you have
 9     anything to add --
10  5000                 First of all, I believe there is
11     question from legal counsel.
12  5001                 MR. BLAIS:  Just a question of
13     clarification, Ms Edwards, concerning your proposal for
14     this 50 percent credit for regional production.
15  5002                 I realize that you might not be able
16     to do that right now.  When we move forward in this
17     process and we consider options, sometimes we face the
18     problem, in having recommendations that we need to put
19     into place, that we need to have some definitions.
20  5003                 I wonder if you might be able to
21     offer us some ideas on how to define "regional
22     production" for the purposes of your recommendation.
23  5004                 I don't know if you have some
24     thoughts now or would like to do that in writing
25     between now and the 15th of October.


 1  5005                 MS EDWARDS:  I would like to submit
 2     that to you in writing.
 3  5006                 MR. BLAIS:  Thank you for that.
 4  5007                 The other aspect that raises an issue
 5     is:  Are you meaning that this 50 percent credit would
 6     only apply -- for instance, if the region were defined
 7     as the west, would the credit only apply for
 8     broadcasters located in the west?  Or would you suggest
 9     that, for instance, a broadcaster in Halifax would also
10     benefit from this additional credit?
11  5008                 MS EDWARDS:  I think the intent was
12     that any broadcaster would benefit.  We are thinking
13     specifically, of course, on a national level.  So a
14     broadcaster that has a national window.
15  5009                 MR. BLAIS:  You are seeing this as an
16     incentive that would help create a window throughout,
17     not just broadcasters in the region from which the
18     regional programming to be defined comes from?
19  5010                 MS EDWARDS:  Yes.  Our purpose is in
20     getting our programs seen by a national audience.
21  5011                 MR. BLAIS:  As you now, at present we
22     have a 150 percent credit for drama.  I take it, then,
23     that this would be above and beyond the existing 150
24     percent credit for drama -- or maybe not.
25  5012                 MS EDWARDS:  I am sorry, I would have


 1     to get back to you on that.
 2  5013                 MR. BLAIS:  That is fine.
 3  5014                 Thank you very much.  Those are my
 4     questions.
 5  5015                 THE CHAIRPERSON:  Thank you, Ms
 6     Edwards.  I hope you also have a good trip back home.
 7  5016                 We will adjourn for lunch now and
 8     resume at 1:30.
 9  5017                 Nous reprendrons à une heure et
10     demie.
11     --- Recess at 1230 / Suspension à 1230
12     --- Upon resuming at 1335 / Reprise à 1335
13  5018                 THE CHAIRPERSON:  Good afternoon, and
14     welcome back.
15  5019                 Madam Secretary, would you invite the
16     next participant, please.
17  5020                 MS BÉNARD:  Thank you, Madam Chair.
18  5021                 The next presentation will be by
19     Vision TV.  I would invite Mr. Fraser to introduce his
20     colleagues.
22  5022                 MR. FRASER:  Thank you very much.
23     Good afternoon; bonne après midi.
24  5023                 My name is Fil Fraser.  I have the
25     honour to be the President and Chief Executive Officer


 1     of Vision TV.
 2  5024                 We took these hearings to be of great
 3     importance, and we wanted to be well represented.  That
 4     is why I am pleased to introduce my colleagues, each of
 5     whom in their own way helps us to fill a very special
 6     mandate.
 7  5025                 On my left is Rita Deverell, our Vice
 8     President of Production and Presentation, one of the
 9     founders of Vision TV, and the producer of our flagship
10     daily human affairs program "Skylight".
11  5026                 On my right is Jim Hanley, President
12     of Sleeping Giant Productions, an independent
13     production company with credits, including the widely
14     distributed series the "Originals", "TVTV", and many
15     series produced for us, including "Tom Harpur's Life
16     After Death", and the 26-part series "Spiritual
17     Literacy: Reading the Sacred and Everyday Life", which
18     is now in production.
19  5027                 Next to him is Paul De Silva, our
20     Executive Producer of Independent Production, whose
21     ability to work effectively with independent producers
22     comes from his own experience as producer of, among
23     other things, a Gemini award winning drama anthology
24     series "Inside Stories".
25  5028                 On my extreme right is Bruce Smith,


 1     the Chair of Vision's Mosaic Program Management Group,
 2     an advisory group representing the more than 60 faith
 3     and religious organizations who broadcast on Vision TV.
 4  5029                 Behind me, from left to right, are
 5     Alberta Nokes, a seasoned communications executive, and
 6     our newest staff member, our Director of
 7     Communications.
 8  5030                 Next to her is David Cole, who is
 9     President of Specialized Media Sales, an agency which,
10     since we were licensed a decade ago, has provided
11     Vision TV with high quality audience research and data,
12     and which has had the unique mandate to sell Vision
13     TV's air time to faith groups and advertisers.
14  5031                 Next to him is Jeannette Loakman, an
15     independent documentary filmmaker.  Her Canadian
16     documentary "Mothers of Re-invention" -- a look at how
17     women are reshaping the new South Africa -- aired on
18     Vision last spring.
19  5032                 Next to her is Stephen Zolf, of
20     Heenan Blaikie, our new legal counsel.
21  5033                 Next to Stephen is Gretchen Jordon-
22     Bastow, an independent producer from Vancouver, who
23     produces and directs social issues documentaries,
24     including "Through the Lens", a six-hour media literacy
25     series about the films and filmmakers of western


 1     Canada.
 2  5034                 We are pleased to be here, and to
 3     tell you that Vision TV is Canada's unique, not-for-
 4     profit, national specialty channel.  Our programming
 5     reflects the multifaith and multicultural diversity of
 6     Canada and seeks to build bridges of understanding by
 7     illuminating all faiths and cultures in our country.
 8  5035                 Not only that, Vision is a well-run,
 9     successful business.  Last fall's Nielsen ratings
10     ranked Vision third among Canadian English specialty
11     channels for weekday prime time viewing.
12  5036                 This is our tenth anniversary, in
13     1998.  We enter our second decade with no debt and a
14     reasonable surplus.  Our operating budget is about $13
15     million -- small in broadcasting terms.  Our subscriber
16     fee is a modest 8 cents; yet over the last four years
17     we have invested 51 percent of our revenues into
18     Canadian programming -- that is almost $24 million --
19     and 63 percent of our total schedule is Canadian in
20     content.
21  5037                 Vision TV embodies the CRTC's
22     Religious Broadcasting Policy by providing balanced
23     access to the full mosaic of faiths -- from Anglicans
24     to Zoroastrians literally -- which reflect the
25     religious diversity of Canada with more than 60 groups


 1     broadcasting on Vision.
 2  5038                 We fulfil our mandate through
 3     programming, which includes documentaries, feature
 4     films, comedy, music and performance.  We have a
 5     special interest in documentaries focusing on matters
 6     of the spirit, which comprise roughly 25 percent of our
 7     prime time programming.
 8  5039                 Of the 34 documentaries funded last
 9     year by Telefilm Canada, 14 had broadcast licences from
10     Vision TV.  Our 1997 investment of approximately $1.4
11     million in documentaries that accessed the CTV, as it
12     is now called, generated total production budgets of
13     $7.7 million and produced 62 hours of new Canadian
14     documentary programming.
15  5040                 MS DEVERELL:  Vision TV makes a
16     contribution beyond its size to the system.  We are a
17     small player in a world where broadcasters are getting
18     bigger through consolidation, which means more of the
19     same on more channels.  To provide the diverse voices
20     that is Canada's diversity, we need to have a system
21     where big and small players must make an equitable
22     contribution to the goals of the Act.
23  5041                 It is important to remember that
24     little guys can do a lot.  We bring new ideas and a
25     kind of programming to the system which others cannot


 1     afford to risk.
 2  5042                 Vision TV takes the lead in
 3     addressing critical and fundamental human issues which
 4     fall outside the core interests of the mainstream,
 5     profit-driven broadcasters.  We produce and present
 6     programs which no one else does and which matter to a
 7     significant number of Canadians, largely through
 8     working with independent producers from coast to coast
 9     -- and we do it on a limited budget.
10  5043                 What may be considered moderate
11     audiences for conventional broadcasters are significant
12     audiences for specialty channels, which super-serve
13     niches of interest.  In the context of building
14     Canadian culture, the audiences of such programs as
15     "Images of Love", "Words of Hope", "Conversations with
16     Jean Vanier", "Let's Sing Again", "Dad's Under
17     Construction", "Callwood's National Treasures" and
18     Vision's daily prime time human affairs magazine
19     "Skylight" -- which I produce -- are significant
20     audiences.
21  5044                 "Skylight" reaches over 30,000
22     viewers from Monday to Friday.  It features many
23     documentaries from across Canada and on international
24     issues of concern to Canadians, such as the story of
25     the genocide foretold in Rwanda which we broke to


 1     international attention last year.
 2  5045                 Canadian peacekeepers, faith
 3     communities and social justice groups played a major
 4     role in addressing and reporting on the plight of
 5     Rwanda.
 6  5046                 Vision TV brought the story home in a
 7     fuller, more meaningful way than larger broadcasters
 8     and other international media who later accessed our
 9     documentary footage for their reports.  And the program
10     reached 100,000 viewers.
11  5047                 With our small budget, we produce and
12     present quality programs which have won awards and
13     nominations, including the B'nai Brith Human Rights
14     Award, the international Gabriel Certificate for
15     "station of the year", and this year's Gemini
16     nominations for Best Information Segment and Best
17     Documentary Series.
18  5048                 This week you have heard about large
19     enterprises and large sums.  It is important to
20     remember that smaller sums in the hands of smaller
21     players go a long way to bringing more quality programs
22     to Canadian audiences.
23  5049                 As a small but vital player, Vision
24     TV contributes to the goals of the Broadcasting Act by
25     providing a diversity of programming truly reflective


 1     of the multicultural nature of Canada.  Yet, the full
 2     impact of this contribution could be more fully
 3     realized if Vision were not played on a channel
 4     inaccessible to many viewers in the country's largest
 5     cable market.
 6  5050                 For us to continue to provide this
 7     diversity in the system, people have to be able to see
 8     us, whether they have the latest high tech gizmo or a
 9     36-channel converter.
10  5051                 To ensure that Canadians can receive
11     a predominance of Canadian programming, we have
12     recommended a hierarchy of access approach.  This would
13     ensure that Canadian services that best meet public
14     policy objectives are given pride of place.
15  5052                 MR. FRASER:  Now we would like to
16     address the definition of Canadian programming which
17     you asked us to respond to in 1998-59.
18  5053                 In our written brief we suggested
19     that a Canadian program is one that is made by
20     Canadians, primarily for Canadian audiences --
21     primarily for Canadian audiences.  This includes
22     programs on universal subjects seen from a Canadian
23     perspective.
24  5054                 Jim Hanley will elaborate.
25  5055                 MR. HANLEY:  My company, Sleeping


 1     Giant, has produced 448 hours of documentary programs
 2     and series over the last ten years, about 50 percent in
 3     partnership with Vision TV.  All of these have been
 4     distributed internationally.  More than 2 million
 5     Canadian viewers alone have tuned in to "Life After
 6     Death with Tom Harpur", our most successful series to
 7     date.
 8  5056                 Broadcasters, particulary specialty
 9     channels, increasingly rely on documentaries to provide
10     engaging, entertaining and cost effective Canadian
11     content in their schedules.  As a producer, it is great
12     to see this rise in demand.
13  5057                 But the demand is not being met.  The
14     pressures on the funding envelope for documentaries has
15     increased dramatically, and because of the resulting
16     triage, eligibility is narrowing.
17  5058                 This year we wanted to follow the
18     success of several series with journalist and
19     theologian Tom Harpur, a bone fide Canadian star by any
20     measure, with a new project.  Even though "Tom Harpur's
21     The Believers", a series featuring this great
22     Canadian's unique take on the founders of the world's
23     major spiritual movement, was Vision TV's first choice
24     to propose to the CTF, I was forced to withdraw it.
25  5059                 It was clear that it would not be


 1     deemed Canadian enough to fit the Fund's "distinctively
 2     Canadian" criteria.  Yet, what could be more
 3     distinctively Canadian than a Tom Harpur project?
 4                                                        1340
 5  5060                 MR. FRASER:  What indeed.  The 20 per
 6     cent funding envelope for genres other than drama must
 7     be shared by music and dance, variety and
 8     documentaries.  This is, we submit, an inadequate sum
 9     given the demand for programming needed by specialty
10     services which the Commission has licensed.
11  5061                 To deal with this increased demand
12     for funding, the bar for eligibility has been raised.
13     The CTF's distinctively Canadian criteria, originally
14     intended as a way to give productions in a variety of
15     genres bonus funding, is now being used as the criteria
16     by which to evaluate documentaries.  This is a serious
17     problem.
18  5062                 We suggest that the criteria for
19     distinctively Canadian programs need to be redrawn to
20     better reflect the realities of Canadian documentaries
21     and documentary makers.  This is made more urgent as
22     the CTF is advancing quickly to announce new criteria
23     as early as December.  This hearing, we believe, is a
24     valuable opportunity for input into this process.
25  5063                 We trust that the CTF will be paying


 1     close attention to the issues raised here.  Like most
 2     participants in these proceedings, Vision TV believes
 3     that documentaries should be included in the
 4     under-represented categories used to satisfy
 5     conventional broadcasters' conditions of licence.  This
 6     would drive, we believe, the establishment of dedicated
 7     funding for this category.
 8  5064                 Higher priority and dedicated funding
 9     are the key to enabling this uniquely Canadian genre to
10     survive and prosper.  Documentaries should be treated
11     with no less favour than drama as they also tell our
12     stories.
13  5065                 Vision TV recommends that specific
14     funding allocations are needed to support
15     documentaries.  These essential cultural products are
16     motivated primarily from an impulse to tell rather than
17     to sell a story.  They need public funding to exist.
18  5066                 Documentaries are an excellent and
19     cost effective investment by Canadian taxpayers in
20     developing and maintaining our national culture.
21  5067                 We thank you for the opportunity to
22     participate.  We look forward to your questions which
23     any one of us on the panel are prepared to answer.
24  5068                 Thank you very much.
25  5069                 THE CHAIRPERSON:  Welcome and thank


 1     you, ladies and gentlemen.
 2  5070                 Commissioner Pennefather, please.
 3  5071                 COMMISSIONER PENNEFATHER:  Good
 4     afternoon.
 5  5072                 MR. FRASER:  Good afternoon.
 6  5073                 COMMISSIONER PENNEFATHER:  Thank you
 7     for that presentation, for your submission and for
 8     everyone coming here from Toronto and elsewhere.  We
 9     appreciate your contributing to the diversity of the
10     attendees at this hearing.
11  5074                 MR. FRASER:  Thank you.
12  5075                 COMMISSIONER PENNEFATHER:  I would
13     like to ask you a number of questions.  Actually they
14     are more points that I hope we can elaborate on a
15     little bit more because I think you have made some
16     important contributions to discussions, some of which
17     we were having earlier today.
18  5076                 First, though, I do note that a
19     significant part of your written submission, and you
20     have included in your comments today, particularly
21     Rita's comments, your concerns relating to access and
22     carriage issues.  I want to be sure that you are aware
23     that the Commission has now decided to hold a policy
24     process in the new year with respect to a licensing
25     framework for the specialty services.  I am sure this


 1     will provide an opportunity for you and other parties
 2     to discuss this issue at greater length.
 3  5077                 MR. FRASER:  We are gratefully
 4     encouraged, Madam Commissioner, by the Commission's
 5     move in this direction.  We, as you know, are part of
 6     the SPTV Industry Association.  We are one of the
 7     founding members.  We have advocated this and we are
 8     pleased with the response.
 9  5078                 COMMISSIONER PENNEFATHER:  Good.  Not
10     surprisingly then, I would like to turn to
11     documentaries.  If you could, I would appreciate if you
12     would bring together for us your various
13     recommendations in this regard.
14  5079                 You discussed in your oral
15     presentation criteria to evaluate documentaries and
16     your concern about the way documentaries are defined at
17     the moment.  You have also added to this a comment
18     about how to describe what the definition is of a
19     Canadian program, so I would like to hear a little bit
20     more about that.
21  5080                 Secondly, you have several
22     recommendations regarding greater support to
23     documentaries by funding agencies and support to
24     documentaries through inclusion in the
25     under-represented categories.


 1  5081                 If we look at those three points, we
 2     may be able to get a clearer picture on how you put all
 3     these pieces together to assure the future of
 4     documentaries in the Canadian system.
 5  5082                 Then I would like to talk about what
 6     all this means for Vision in particular.  If you start
 7     then by your criteria, could you be just a little
 8     clearer on what is your concern about current criteria
 9     used to evaluate documentaries.
10  5083                 MR. FRASER:  I would like to invite
11     some of my documentary producer colleagues to respond
12     to this.  Let me set the stage by suggesting that we
13     think that the documentary is, among many other things,
14     a very important carrier of Canadian culture.  It's an
15     effective way of telling Canadian stories.
16  5084                 Documentaries are not just a series
17     of people talking about some issue.  They are
18     structured events with beginnings, middles and ends
19     that are an art form.  Because of the nature of the
20     country, which is becoming increasingly diverse, a
21     documentary someone said earlier, and I will just steal
22     this from you, Paul, a flood in Bangladesh 10 or 15
23     years ago was a foreign story.  Today it's a story that
24     affects your neighbour.
25  5085                 We think in our definition of


 1     documentaries that we need to cast a wide lens, a wide
 2     net, that allows for Canadians' perspectives not just
 3     on things going on within our borders, but things going
 4     on anywhere in the world that affect our citizens.
 5  5086                 We define documentary as meaning by
 6     Canadians and I think this is a key point for us.  The
 7     intent which the documentary maker or the film maker
 8     brings to the exercise, and the broadcaster as well, is
 9     that it is intended to tell these stories to Canadian
10     audiences.
11  5087                 You can have in some circumstances
12     programs that meet all the criteria for Canadian or
13     super-Canadian, ten out of ten, hundred out of a
14     hundred, if you like, and they may simply be fronts for
15     other kinds of programs that really aren't primarily
16     intended to tell Canadian stories to Canadians.
17  5088                 I better stop now because I might get
18     carried away.
19  5089                 I pass to Jim Hanley who might want
20     to add to that.
21  5090                 MR. HANLEY:  In terms of the criteria
22     for Canadian documentaries, we have no problem
23     whatsoever.  I'm talking for Sleeping Giant Productions
24     here as an independent producer.  I have no problem
25     whatsoever with the criteria set down by the Canadian


 1     Television Fund or Telefilm Canada.  They have a list
 2     of those criteria.  They're fine.
 3  5091                 When you come to the point system,
 4     ten out of ten, absolutely no problem whatsoever.  We
 5     are prepared in virtually every circumstance to meet
 6     that.  If we don't, if we are involved as we are
 7     currently in conjunction with Vision and
 8     Italian-Canadian co-production where there are foreign
 9     elements, they are not eligible for CTF moneys, but we
10     are proceeding with this.  Everything's fine.  There's
11     no problem.
12  5092                 Where there's a problem or where
13     there has been a problem is in this super-Canadian or
14     distinctively Canadian business that has now been added
15     to everything is a content question.  The points are
16     fine.  The criteria for a documentary are fine, but now
17     the people are saying what the content has to be.
18  5093                 COMMISSIONER PENNEFATHER:  Who is
19     saying?  Who are the people?
20  5094                 MR. HANLEY:  Well, in the issue of
21     the Canadian Television Fund, there was strong
22     suggestion that the content would have to be Canadian. 
23     It would have to be a story set -- I mean, now I am
24     bandying because nobody ever has said this directly to
25     me, but the interpretation would be that the story


 1     would be set in Swift Current, Saskatchewan, or
 2     whatever, as opposed to in the case of the Tom Harpur
 3     question, this major figure who is approaching his take
 4     on the founders of the world's great spiritual
 5     movements, all of whom have adherents in this country
 6     of ours, is deemed not Canadian enough to fit that
 7     super-Canadian status.
 8  5095                 That I take great odds with because I
 9     think that that would mean in order to finance these
10     kinds of narrowly defined Canadian documentaries, in
11     order to achieve that kind of funding it would have to
12     be financed almost entirely within the Canadian system
13     and you would have no opportunity to leverage the money
14     with any kind of international distribution.
15  5096                 MR. FRASER:  I wonder, Commissioner,
16     if I can ask Paul De Silva to add to that.  I may be
17     getting ahead of ourselves, but we all saw the letter
18     from the fund which appeared magically yesterday.  It
19     advances a definition which I think you may want to
20     comment on.
21  5097                 MR. DE SILVA:  Thanks, Fil.
22  5098                 I think the concern as expressed by
23     Jim is that there may be times, and this is one
24     specific situation, when a documentary program, in this
25     case a series, that may have all qualifier ten out of


 1     ten points but may have some subject matter that is
 2     beyond our borders and that because the demand is so
 3     great on the fund that as the demand increases, they
 4     increase the screens, as they put it, in terms of how
 5     they evaluate a project.
 6  5099                 The greater the demand, the higher
 7     the screens go so that eventually something that
 8     doesn't have complete 100 per cent subject matter, for
 9     instance, and in this case it may be Tom Harpur's
10     perspective on Buddha or Hildegarde or Bingham or Joan
11     of Arc or something like that.  I hope I am using the
12     right examples here.  These are part of the series.
13  5100                 COMMISSIONER PENNEFATHER:  Joan of
14     Arc is fine.
15  5101                 MR. DE SILVA:  Joan of Arc.  That was
16     inadvertent.
17  5102                 COMMISSIONER PENNEFATHER:  That was
18     really a heroine of mine.
19  5103                 MR. DE SILVA:  So I will repeat Joan
20     of Arc, I guess.
21  5104                 As those go up higher in the screen
22     process, it could be eliminated.  I think in general is
23     that we support the idea of distinctively Canadian.  We
24     know why it's there.  The ten out of ten is fine, but
25     there has to be flexibility in the system.


 1  5105                 We are not suggesting here the
 2     language to do that because I think that has to be
 3     under consultation with the CTF, but to leave the
 4     opportunities and the openings there for these kinds of
 5     programs.
 6  5106                 MR. FRASER:  The Canadian Television
 7     Fund letter, and I will stop quickly, it says, and I
 8     quote:
 9                            "It will support only those
10                            projects which are based on a
11                            Canadian point of view and
12                            reflect Canadian themes, stories
13                            and events."
14  5107                 We want to make sure that as this
15     process winds through and the decisions are made that
16     Canadian themes, stories and events reach out across
17     the world.
18  5108                 COMMISSIONER PENNEFATHER:  Which
19     brings me exactly to my next point, and there are many
20     different avenues we could take.  I appreciate and
21     thank you for this discussion on distinctively
22     Canadian.  We hear the phrase "Canadian stories" over
23     and over again and it always raises this debate.
24  5109                 I guess under certain criteria the
25     films boards universe wouldn't apply then.  It's a


 1     little out of our borders.
 2  5110                 MR. FRASER:  Absolutely.
 3  5111                 COMMISSIONER PENNEFATHER:  Speaking
 4     of outside our borders, there has been discussion here
 5     and certainly elsewhere about exportability.  I am
 6     largely coming at this and now we will move into the
 7     financing questions.
 8  5112                 What do you think about the Council
 9     of Canadians' comment that a framework, a regulatory
10     framework which is geared towards supporting the
11     exportability of programming would work against our
12     objectives to increase Canadian programming,
13     particularly local programming?  That was the context
14     of the discussion.
15  5113                 If you could speak to that and help
16     us clarify at what point you remain Canadian while
17     being exportable.  It's a very important question in
18     terms of, obviously, financing.  It's interesting that
19     yesterday ACCESS raised the fact that they had
20     important U.S. markets for their educational materials. 
21     We spoke this morning about educational informational
22     programming and lifelong learning materials produced by
23     Canadians.
24  5114                 A learning culture about just
25     Canadian subjects is another angle at this point, but


 1     let's be specific about documentaries, their
 2     exportability as a funding mechanism.  In so doing, do
 3     they become then increasingly less Canadian?
 4  5115                 MR. FRASER:  I'm sure Jim is itching
 5     to speak to that.
 6  5116                 We hold to our position that it may
 7     be easier to say than to do, although I think it can be
 8     done, that the primary audience intended for the
 9     program should be a governing factor, should be a
10     determining factor.
11  5117                 There's quite a significant
12     difference between -- in the case of the Tom Harpur
13     project, Tom Harpur's believers of looking through his
14     eyes, his knowledge, his experience at the great
15     spiritual leaders of the world and someone else coming
16     along from another country and having a production that
17     goes somewhat along the lines in saying well, we can
18     get some points in Canada if we hire Tom Harpur to
19     stand up in front of the camera and say a few words.
20  5118                 I think we can figure out which is
21     which and tell the difference.
22  5119                 We also in our various submissions
23     have talked about a two tiered approach to funding.  We
24     have been priming the pump in this country for a long
25     time, going back to the CFTC days when I was


 1     foolhardedly making feature films.
 2  5120                 I think it worked.  We now have a
 3     healthy production industry that can stand on its own,
 4     that makes products for the international marketplace
 5     that is very successful.  There are companies that do
 6     both.  Some of them are publicly traded huge
 7     enterprises that make distinctively Canadian programs
 8     and make programs for the export market.
 9  5121                 We think that those programs that are
10     made for the world market principally, they couldn't
11     happen unless they had funding from other countries,
12     are in a different envelope from those programs that
13     are driven by cultural imperatives and are made
14     primarily for Canadian audiences, although we hope that
15     others would like to see them as well.
16  5122                 We have suggested that there be two
17     kinds of -- two approaches to this kind of funding.  We
18     know that we have made some progress in that direction
19     and in many ways it's happening and it's happened in
20     some respects, but we think that this is a very good
21     way of making a division and answering your question as
22     to who gets what.
23  5123                 If the objectives are to get more
24     Canadian programming for Canadian audiences on our
25     screens, we know that programs substantially won't be


 1     made without funding from public sources whereas the
 2     other kinds of programs, documentaries included some of
 3     them, are playing in a different ball park.
 4  5124                 COMMISSIONER PENNEFATHER:  But one of
 5     your proposals, I think, is that broadcasters rather
 6     than funding agencies should determine which programs
 7     receive funding.  Perhaps you should explain how that
 8     would be accomplished and in whose hands we place
 9     perhaps that kind of decision.
10  5125                 MR. FRASER:  The question caveats,
11     the broad issue we believe is that that creators,
12     producers and broadcasters who agree to exhibit those
13     products should make the decisions as to what gets
14     broadcast and what gets funded.  This is in some ways a
15     reaction to the industrial strategy which we have seen
16     all of the funds go through where they looked at and
17     made decisions about funding based on the exportability
18     and the international marketing potential of those
19     programs and they tended to favour programs with
20     international marketing potential.
21  5126                 We think that has succeeded.  That's
22     one caveat.  The other important caveat is that we need
23     to be mindful, as the Commission has been reminded
24     several times here this week, of the fact that there
25     needs to be rules put in place that safeguard the


 1     situation when a broadcaster is also a producer or
 2     vice-versa to avoid the potential possibility of
 3     self-dealing so that all producers have a fair chance
 4     of getting their product exhibited.
 5  5127                 COMMISSIONER PENNEFATHER:  So what
 6     this means is that producers should have access to
 7     production funds directly.
 8  5128                 MR. FRASER:  Yes.
 9  5129                 COMMISSIONER PENNEFATHER:  With
10     safeguards.
11  5130                 MR. FRASER:  Yes.
12  5131                 COMMISSIONER PENNEFATHER:  This is
13     your proposal.
14  5132                 On page 6, again a funding question,
15     of your written submission, could you just explain what
16     it means, paragraph 4.1, the last sentence:
17                            "We recommend, therefore, that
18                            the support for documentaries be
19                            continued and increased by
20                            allocation of a greater and
21                            specially dedicated share of the
22                            total funding envelope to
23                            documentary producers."
24  5133                 Just to be clear, which envelope are
25     you referring to, the 20 per cent or a portion or the


 1     20 per cent?  What envelope is that?
 2  5134                 MR. FRASER:  We think that there
 3     ought to be a new envelope created for documentaries, a
 4     new category for documentaries, and the documentaries
 5     shouldn't be included in the 6, 7 and 8 or 7, 8 and 9
 6     category -- 7 and 8 I suppose is where they presently
 7     fit -- that documentaries are such an important way of
 8     telling Canadian stories that they should have their
 9     own category in terms of the Commission's set of
10     categories and with that their own funding envelope.
11  5135                 Now, we know that the Commission
12     doesn't set the funding parameters.
13  5136                 COMMISSIONER PENNEFATHER:  Yes.
14  5137                 MR. FRASER:  But we do know as well
15     that the Commission can determine that documentaries
16     play a larger role in prime time exhibition.  Were that
17     the case, if broadcasters were required to broadcast
18     more documentaries in prime time, that would drive the
19     funding to that category, to that envelope.
20                                                        1400
21  5138                 We don't want to take money away from
22     anybody else.  We think drama is important and so are
23     the other categories.  We feel that documentaries are
24     getting short shrift in the present environment.
25  5139                 COMMISSIONER PENNEFATHER:  So I am


 1     clear, documentaries should be included in under-
 2     represented categories or documentaries should be their
 3     own category?
 4  5140                 MR. FRASER:  Well, they certainly
 5     should be represented in the underrepresented category,
 6     but better still would be to have a category of their
 7     own which was given a high priority.
 8  5141                 COMMISSIONER PENNEFATHER:  And where
 9     is this funding mechanism, at CTF or where?
10  5142                 MR. FRASER:  Well, it would be a
11     rebalancing of the funds as they now exist if we create
12     a new category for documentaries.
13  5143                 COMMISSIONER PENNEFATHER:  This
14     morning we spoke with the Canadian Independent Film and
15     Video Fund, with whom I am sure you have been working
16     on some projects and they have been talking about the
17     possibility of BDU putting a portion of their benefit
18     contribution into other funds other than CTF.  Is this
19     something that you --
20  5144                 MR. FRASER:  We would support that.
21  5145                 COMMISSIONER PENNEFATHER:  You would
22     support that.
23  5146                 Speaking of support or non-support, I
24     was interested in your position on the CAB's approach
25     to focus on establishing goals for viewing levels for


 1     Canadian programming.  What is your comment on this
 2     proposal?  What would it mean for Vision and for
 3     documentaries?
 4  5147                 MR. FRASER:  Did we take a position
 5     on the CAB's --
 6  5148                 COMMISSIONER PENNEFATHER:  I am
 7     asking you what you think it is.
 8  5149                 MR. FRASER:  You are asking for a
 9     position?
10  5150                 COMMISSIONER PENNEFATHER:  Yes.
11  5151                 MR. FRASER:  I suppose, as others
12     have said, if we made numbers the chief criterion for
13     determining what kind of things -- what gets broadcast,
14     I suppose we could do very well by creating a Canadian
15     Jerry Springer or a Canadian Bill Clinton and just
16     broadcasting it wall to wall.  We would certainly get
17     the viewers.
18  5152                 As many have said, it is not just
19     numbers, it's quality.  It is what it does for the
20     audience.  It's perceived value by the audience.
21  5153                 One of the things that is special
22     about our viewers, which are not huge in number as
23     everyone knows, is the loyalty that they have to what
24     we produce and broadcast because it means something in
25     their lives.


 1  5154                 So, we are not enthralled with the
 2     idea of -- it's a bit like the wag the dog kind of
 3     phenomenon.  We are not enthraled with the idea of the
 4     largest number of viewers, the lowest common
 5     denominator driving the system.
 6  5155                 MS DEVERELL:  Could I add something
 7     to that?  On the other hand, since I am one of the
 8     people who mentioned numbers, numbers are not
 9     inconsequential.  We have been in business for 10 years
10     and one of the ways that we stay in business is by
11     having sufficient numbers, but it is a kind of a
12     balancing act.  I think that we all -- all of the
13     participants in the system have a responsibility to
14     engage in that balancing act.  You have your programs
15     that drive the schedule and that allows you a certain
16     margin of risk for things that have fewer numbers.  And
17     if you stick with those things they may do extremely
18     well.
19  5156                 We have a show that draws frequently
20     more than 100,000 that some people said would never get
21     flies because it is just a bunch of people sitting
22     around the parlour piano, but we believed -- and it is
23     produced in Victoria.  We believed that was a viable
24     concept and we stuck with it until it has substantial
25     audiences.


 1  5157                 So, I think it is incumbent on all of
 2     us to do that balancing act.  It is not that things
 3     must have huge numbers or they must have puny numbers. 
 4     It's a balancing act.
 5  5158                 MR. COLE:  If I could just add to the
 6     numbers there.  The numbers quite often for that
 7     program exceed 100,000 viewers on a regular basis.  It
 8     is one of our top-rated programs.
 9  5159                 COMMISSIONER PENNEFATHER:  Thank you
10     very much.
11  5160                 I have two other questions.  The
12     first is, if you consider the recommendations you have
13     brought to us there is a mix of issues that we can deal
14     with directly as the CFTC and which remain with funding
15     agencies.  In the end, what would you like to see us
16     come out with at the end of this hearing, the CFTC? 
17     What are you looking for from us?
18  5161                 MR. FRASER:  Three things.  One, that
19     you continue to stay in the game of regulation for some
20     considerable time.  One could foresee a future in which
21     in a digital universe where access is not an issue that
22     regulation can relax quite a bit.  In fact, we have
23     recommended that there be a different regulatory regime
24     for systems in which access is not an issue, as
25     compared to those in which it is.


 1  5162                 So, one is to stay in the game and,
 2     two, is access, which is still in a limited universe of
 3     carriage capacity of great importance.  All channels
 4     are not equal and I don't think I need to labour that
 5     point.
 6  5163                 And, three, to find ways of making
 7     documentaries a more important part of the Canadian
 8     broadcasting mainstream.
 9  5164                 COMMISSIONER PENNEFATHER:  Very
10     quickly, if in fact we pursue that so the documentaries
11     are an important part of the conventional mainstream,
12     how will this affect your business?
13  5165                 MR. FRASER:  We don't call ourselves
14     a documentary channel.  We do many things, but the
15     documentaries that we do -- and I will ask Jeanette
16     Loakman to talk about the documentary she did -- come
17     from independent producers across the country.
18  5166                 Our mandate is to reflect the
19     spiritual and cultural diversity of Canada.  We find
20     that the best way of doing that is to go to independent
21     documentary producers who are trying to tell, not sell
22     their stories, who are working out of passion.
23  5167                 Jeanette Loakman made a documentary
24     in which she just -- she couldn't get anybody to
25     support her.  She just did it because she had to do it. 


 1     Many of our documentaries are made by people who just
 2     have to tell those stories.  They are important.  They
 3     are passionate and more often than not they touch very,
 4     very deeply on spiritual values and that's our mandate.
 5  5168                 So, as it turns out -- and the
 6     documentary is a very important part of what we do.
 7  5169                 May I ask Jeanette to tell her story?
 8  5170                 MS LOAKMAN:  I think what Vision
 9     enabled me to do was to be able to tell the story, not
10     sell the story.  I never got any funding for it, apart
11     from monies from them to be able to finish it.
12  5171                 The story is very important.  It is
13     about women reshaping the new South Africa.  Back in
14     1995 after the elections, South Africa had a chance to
15     reinvent itself and many of the stories coming at that
16     time were from journalists looking for conflicts,
17     whether it be tribal war or rugby.
18  5172                 I wanted to find out really what was
19     happening.  So I went down there, shot the film, came
20     back and I found a lot of great stories of women doing
21     stuff at the community level and actually making change
22     in their country.
23  5173                 If I had not gone and shot that
24     nobody would have given me the money to do it.  I think
25     the story was relevant to people and women in Canada


 1     because South Africa mirrors a lot of what Canada has. 
 2     We are a country where a lot of immigrants come to.  In
 3     fact, we are mostly immigrants if you think about it.
 4  5174                 The story was relevant to Canadians
 5     and as a storyteller and this is one part going back to
 6     what is Canadian or not, as a film-maker I had a
 7     distinct advantage in that Canada is well known for
 8     peacekeeping.  Canada is well known for not colonizing
 9     anybody and I was given a lot of access that I wouldn't
10     have had otherwise.
11  5175                 Going back to the points that we are
12     trying to make here which I haven't forgotten --
13  5176                 COMMISSIONER PENNEFATHER:  You have
14     made it very well.  That's fine.  Nothing speaks
15     stronger than the film itself, than the creative
16     artist.
17  5177                 MS LOAKMAN:  I think the more
18     opportunity we have to tell stories, the more that
19     people will understand what is going on in the world
20     and also what is going on in the world around them.
21  5178                 COMMISSIONER PENNEFATHER:  This
22     brings me to where I would like to stop my questions to
23     all of you.  Perhaps Mr. Fraser can take the lead.  I
24     think Ms Loakman has started us off well.
25  5179                 Yes, Vision has led the way in terms


 1     of diversity in programming, in staffing, in financing
 2     of projects in this country, but I would ask you to use
 3     the word "vision" a little differently now and speak to
 4     a broader vision in terms of the broadcasting system in
 5     this country.  Do you have some comments for us on how
 6     to assure greater diversity within the system as a
 7     whole?  What are the steps that should be taken in that
 8     regard?  I think we have some challenges ahead and in
 9     the midst of all of these discussions about
10     programming, Canadian programming and other questions
11     we have had, how should we address the issue of
12     diversity in the conventional broadcasting system?
13  5180                 MR. FRASER:  I think, first of all,
14     we have demonstrated and so have others that niche
15     broadcasting works -- it meets real needs of real
16     people and is successful and can thrive.  There are
17     access issues involved.
18  5181                 I remember a discussion back when I
19     was on the Broadcasting Task Force 10 or 12 years ago
20     about how to deal with the private sector of
21     broadcasting.  There was an argument being advanced at
22     that time that why don't we just let them do what they
23     like, run American programs wall to wall and just tax
24     them and give the money to the CBC and to TVO and other
25     Canadian provincial not for profit broadcasters.


 1  5182                 Wisely, we didn't make that
 2     recommendation.  We agreed that the whole system should
 3     meet the needs of the country, all of the parts of the
 4     system, public, private, not for profit needs to make a
 5     contribution to the Broadcasting Act's goals of having
 6     Canada reflected to Canadians.  So, a very important
 7     element in terms of the documentary which we feel very
 8     passionately about, as I think you might have gathered
 9     by now, is simply the matter of shelf space.
10  5183                 Many people have said you can't
11     succeed in getting audiences for programs if you don't
12     put the programs where the audiences are.  You can have
13     wonderful programs and put them in shoulder times or
14     day parts or late night parts and they might do
15     reasonably well, but they are not doing anywhere near
16     what they ought to do.
17  5184                 So, if the Commission and I think it
18     is within your mandate can make judgments about the
19     access to shelf space where the audiences are for
20     documentaries, we don't want to affect or close down or
21     in any way negatively impact all of the good work that
22     is being done in drama and other forms.  We think that
23     the documentary as a peculiarly Canadian form developed
24     in this country is underrepresented in a very serious
25     way because we know that the response that we get to


 1     our documentaries is remarkable.  It is passionate and
 2     it's intense.
 3  5185                 If some of those kinds of
 4     programmings could become part of the mainstream I
 5     think that they would have a tremendous impact.
 6  5186                 COMMISSIONER PENNEFATHER:  Thank you.
 7  5187                 MR. HANLEY:  I wonder if I could just
 8     say that in terms of the conventional broadcasters
 9     running documentaries, one of the things that I have
10     always believed in because many years ago before I was
11     an independent producer, producing primarily for
12     specialty channels -- they didn't even use the term
13     then -- broadcaster.  I was the General Manager of
14     Programming at TVOntario some 25 years ago.
15  5188                 I realized then that it was multiple
16     viewings of these kinds of programs that gave a program
17     its career.  So, in fact, if the conventional
18     broadcaster is regulated and has to show some
19     documentaries, I don't think it will hurt the specialty
20     channel business at all.  The second window is there,
21     the third window, the fourth window.
22  5189                 As a matter of fact, when we talk
23     about exportability and so on of Canadian
24     documentaries, we currently this year are in production
25     of 42.5 hours of documentary programming.  The total


 1     budget involved is $4.5 million, roughly $100,000 an
 2     hour is what we are doing currently and 35 per cent of
 3     that is public money.  Sixty-five per cent of it we
 4     have raised through licences in Canada, multiple
 5     licences.  Many of these projects are Vision. 
 6     Sometimes Vision is the second window, sometimes even
 7     the third window, but we have sometimes four or five
 8     windows in Canada and in each instance, or in almost
 9     every instance substantial distribution advances from
10     international distributors or foreign sales.
11  5190                 These are documentaries that in no
12     way have been compromised in their Canadian integrity
13     at all because in many instances they are based on
14     serious Canadian work, like a Tom Harper book, or in
15     another case a curriculum out of the University of
16     Alberta or the University of Guelph and we are doing
17     that kind of stuff.
18  5191                 But when you go to the table with an
19     international partner or distributor and you say you
20     have got 50 or 60 per cent of your budget together, or
21     even 50 per cent is enough for you to say, "you come in
22     with this."  You control that project.
23  5192                 COMMISSIONER PENNEFATHER:  Thank you
24     very much.
25  5193                 That completes my questions, Madam


 1     Chair.
 2  5194                 THE CHAIRPERSON:  Commissioner
 3     Cardozo.
 4  5195                 COMMISSIONER CARDOZO:  Thank you,
 5     Madam Chair.
 6  5196                 Before I start, I wanted to ask Rita
 7     Deverell a bit more about your program "Skylight."  If
 8     you could tell us a little bit about how you see -- you
 9     refer to it as a human affairs program and how you see
10     that as something that contributes to the overall what
11     we see on television that you would do with Vision that
12     others would not do for whatever reason or would not
13     consider doing.
14  5197                 MS DEVERELL:  The term "human
15     affairs," interestingly enough, came from Jim Hanley in
16     our first year.  We use it as a distinction between
17     human affairs and current affairs, although "Skylight"
18     is a daily magazine with an ethical perspective on
19     current issues.
20  5198                 But what we attempt to do with the
21     show is to go to the depth and ethical dimension of
22     those current issues, the human critical dimension far
23     more than the news dimension.  So, that's the
24     distinction.
25  5199                 The other thing that we attempt to do


 1     with that is not to be making a string of "ain't it
 2     awful" programs.  The first focus statement that we
 3     drew up for the genre was Canadians in their multi-
 4     faith, multicultural and geographic diversity who are
 5     finding some solutions to big problems.
 6  5200                 MS NOLES:  I think it is also
 7     important to remember there the size of the audience
 8     that this program is getting because it is clearly
 9     providing something that people are looking for in the
10     television schedule.
11  5201                 I think that Dave Cole has the
12     numbers for it, but we have drawn, as Rita noted,
13     audiences of around 100,000 for specific specials and
14     regularly draw 30,000 viewers Monday to Friday.
15  5202                 MR. COLE:  If I could just give a
16     number to that.  The first show, the Rwandan Special,
17     had a total reach of 127,000 people and an average
18     minute audience of 97,000, so it's very high numbers.
19  5203                 COMMISSIONER CARDOZO:  Thank you.
20  5204                 I want to ask the two producers you
21     have brought in your group, Jeanette Loakman and
22     Gretchen Jordan-Bastow, if you can just give us a
23     thumbnail sketch.  Don't tell us any stories out of
24     school necessarily, but how you developed a
25     relationship with Vision in terms of at what point did


 1     you go to them and at what point did they kick in some
 2     cash, who else supports the project, just in a fairly
 3     generic way without telling us too many secrets.
 4  5205                 MS JORDAN-BASTOW:  I will speak to
 5     that first if Jeanette doesn't mind.  Vision has --
 6     because of the nature of my work Vision has acquired
 7     and been involved in numerous of my projects.  But a
 8     very good example to bring to this hearing is the
 9     difficulty of putting together the six-hour series
10     which showcased films and film-makers of western
11     Canada.
12  5206                 I use that as an example because the
13     whole reason I did that was to create a venue, so that
14     these people could be seen and these talents that never
15     got shown could be shown.  No one was interested.  It
16     took six years to put that project together.  It did
17     its job because now almost every broadcaster is showing
18     Canadian independent films.  Eight years ago that was
19     not the case.
20  5207                 In order to put that together and get
21     the cable fund and meet the criteria for the
22     percentage, I had to have a coalition of five
23     broadcasters, including a national window and Vision
24     was very, very approachable and very easy to work with
25     and they helped make that happen.  In fact, they have


 1     on numerous occasions, with myself and other producers,
 2     shared windows with other broadcasters and in some
 3     cases doing a launch in unison to make it work.  They
 4     have been very helpful to myself and many of the
 5     producers in going an extra mile to help get our
 6     programs on air and help us navigate a very difficult
 7     jungle of obstacles.
 8  5208                 I wanted to add very quickly that two
 9     years ago when "Through the Lens" first aired, I
10     personally had 32 calls on the first viewing, saying,
11     "My God, I had no idea of the talent and the volume of
12     films."  This was with episode one.
13                                                        1420
14  5209                 The point that I am trying to make is
15     that there is a huge wealth of Canadian talent,
16     Canadian stories, and it is not being shown and it
17     would not be shown if we didn't have the specialty
18     channels and shows like Vision because we are pretty
19     much blocked from the main broadcasters and the bigger
20     licence fees that Global could generate, that CBC
21     generates, et cetera.
22  5210                 That would help a lot to have those
23     open, but I really applaud Vision for their consistent
24     partnership -- and I say "partnership" -- with the
25     independent producers because they really are our


 1     allies and in many cases, if it weren't for Vision, we
 2     wouldn't get our programs on air.
 3  5211                 Thank you.
 4  5212                 MS LOAKMAN:  I would like to also
 5     back up what Gretchen says.  In fact, in my case, it
 6     wasn't a case of selling a story, it was a case of
 7     telling a story.  I went out of my way, I financed
 8     shooting the story myself.  I came back with the
 9     footage.  I managed to finish it, Part I of it, through
10     a grant from the National Film  Board, and by meeting
11     Paul de Silva, who backed me, at least giving me enough
12     money to finish the film; without that, it would still
13     be lying around in tapes underneath my bed or
14     something.
15  5213                 So Vision needs to be there,
16     especially for the younger, for the independent, for
17     the people who still have the passion to go out without
18     worrying about trying to bring in various elements in
19     order to satisfy various cultural/financing
20     opportunities.
21  5214                 Vision is needed.  Vision works for
22     me.
23  5215                 MR. HANLEY:  Vision also urges
24     mentoring kinds of programs.  Often, a young filmmaker
25     will come with an idea or a program maker will come


 1     with an idea to Vision, and maybe Vision feels that
 2     they might need a little bit of guidance.  In many
 3     instances, one in particular, a huge success last year
 4     for us steered them our way -- because we are a little
 5     more established company.  We are still a small
 6     production company, but we do have some facilities and
 7     some experience.  So we were able to help this person,
 8     with the assistance of Vision, make their film.  We
 9     certainly didn't make any money on it at all, but we
10     helped her make her film, and it was an extremely good
11     one.
12  5216                 So Vision goes way out of its way to
13     do that kind of thing.
14  5217                 COMMISSIONER CARDOZO:  Paul deSilva,
15     did you want to add anything in terms of your role as
16     the head hon-cho in terms of dealing with independent
17     producers?
18  5218                 MR. deSILVA:  Just to clarify, I am
19     the head hon-cho of a very small area, but I have a lot
20     of help in that, and I think this is very key, we have
21     representatives on the east coast and the west coast. 
22     So the access point is, you know, very accessible, if I
23     can say that, as well as the fact that the very ethos
24     of Vision is to reflect and develop diverse voices.  In
25     fact, if I can get a plug in for our Gemini


 1     nomination --
 2  5219                 COMMISSIONER CARDOZO:  You guys have
 3     taken a lot of plugs in the last few minutes, but go
 4     ahead; what's one more.
 5  5220                 MR. deSILVA:  One quick one.
 6  5221                 It is illustrative of the fact that
 7     the strand that is nominated is called "Voices".  It is
 8     a Tuesday night strand.  We have a theme on every
 9     night.  So that's the strand that produced several
10     documentaries that have gotten recognition for that.
11  5222                 I think what is key to this is the
12     ability to be able to take risks and the ability to
13     work whatever we can in terms of the system, in terms
14     of funding.  I think Commissioner Penneafather's
15     question about our documentary -- I think it is a very
16     important thing for us to reinforce.
17  5223                 Very quickly, the example of
18     Jeannette's film, Jeannette had shot it, she had to go
19     through the whole process of going to the Cable Fund,
20     to Telefilm, to CIFV, to tax credits, the usual game,
21     the dance that is so debilitating for producers.  The
22     film was shot.  With some money from us she was able to
23     finish it and produced a terrific film.
24  5224                 So, for me, one, I am helping
25     Jeannette, yes, but it is also a very good deal for us


 1     because very often what we do is take a big risk when
 2     we extend a licence fee to somebody because we never
 3     know if that film is going to get financed, because
 4     they still have to go to Cable Fund, Telefilm, tax
 5     credits, et cetera.  So we may want desperately to have
 6     that film in our schedule for the next season, but if
 7     the funding isn't there, it ain't going to happen.
 8  5225                 So that's a reinforcement in terms of
 9     establishing envelopes for documentary and increasing
10     the value of documentary in the system.
11  5226                 MS LOAKMAN:  May I also just go back
12     to the subject of Vision --
13  5227                 COMMISSIONER CARDOZO:  Sure.
14  5228                 MS LOAKMAN:  -- and how it helps me
15     as a producer?
16  5229                 One of the things about Vision is
17     that it does have quite an open programming mandate. 
18     It is about matters of spirituality.  It doesn't have a
19     defined strand.
20  5230                 In the world of producing
21     documentaries, one often has to fit into the mandate of
22     a strand, and Vision is very open with that.  It is not
23     that I have to suddenly put a scientific spin on it to
24     sell it somewhere.  I don't have to suddenly put a
25     historic spin to sell it somewhere.  I can tell the


 1     story that I found or the story that I want to tell.
 2  5231                 COMMISSIONER CARDOZO:  Thanks very
 3     much.
 4  5232                 Lastly, I just want to come back to
 5     Fil Fraser and follow up on a question that
 6     Commissioner Pennefather had asked at the end with
 7     regards to diversity.  That's one of the issues we are
 8     looking at, is how the broadcasting system and
 9     broadcasters, conventional broadcasters, should reflect
10     the cultural diversity of the country.  You seem to do
11     it fairly well through your operation.
12  5233                 Do you have recommendations as to how
13     others could do that, or would you rather they didn't,
14     so that it was your forte?
15  5234                 MR. FRASER:  Ten years ago, in March
16     of 1988 -- I think you were there -- I chaired the
17     National Forum on Multiculturalism in Broadcasting in
18     Toronto, funded by what was then the Department of
19     Communications.  We had representatives of all of the
20     major broadcasting groups, English and French, in
21     Canada come and talk about their plans for having their
22     organizations both on air and off air to reflect the
23     reality of the country we live in.
24  5235                 I think that we have made some
25     progress since then, but I think that we have a long


 1     way to go.
 2  5236                 COMMISSIONER CARDOZO:  Is it really a
 3     big deal?  Does it cost a lot?  Is it impossible to do? 
 4     You seem to be able to do this stuff --
 5  5237                 MR. FRASER:  For us, it is no issue. 
 6     We don't think about it.  It just happens that way
 7     because our doors are open.
 8  5238                 In my perception, it is not what you
 9     do as much as what you fail to do.  We just don't
10     exclude any ideas or any possibilities or any people. 
11     I think that it is not unreasonable to suggest that in
12     some cases people are, by one means or another,
13     excluded from being in the game.
14  5239                 Now, Commissioner Cardozo, you are
15     asking me to go down a very slippery road here because
16     the Commission has tools and it is in your mandate to
17     require that broadcasters reflect diversity.  We think
18     that that's an area of your mandate that perhaps needs
19     some attention, and I think that occasional statements
20     from the Commission addressing those issues will have
21     an impact.  I think that they could be a little more
22     frequent and a little more powerful.
23  5240                 Let me stop and invite Rita Deverell,
24     who has been there at Vision certainly all along, to
25     bring a perspective on this that I may not have.


 1  5241                 MS DEVERELL:  I think also, in
 2     Commissioner Pennefather's earlier question, there was
 3     buried the notion that if conventional broadcasters got
 4     heavily into the documentary business, would that put
 5     us out of business, and I think the answer is "no".
 6  5242                 There is a significant place for all
 7     of the parts of the system to work together on this
 8     issue.  The Commission does have the tools to steer
 9     conventional broadcasters that way.  But clearly, when
10     we are talking about large budget documentary series,
11     that's the territory of conventional broadcasters. 
12     When we are talking about series, that's the territory
13     of conventional broadcasters.
14  5243                 As you have heard, we are very good
15     at the one-off, labour-intensive, the-door-is-open,
16     Victoria-to-Yarmouth -- this is where are two regional
17     offices are.  That's very hard for conventional
18     broadcasters to do.  And the more they do that job, the
19     more we can do our job, which is our niche,
20     spirituality, and people come to us, filmmakers come to
21     us with those projects because they are dead on their
22     mandate.
23  5244                 That small format -- and by "small",
24     I don't mean "insignificant", as we have kept saying,
25     but there is room for everybody as long as the tools


 1     are in place to do that job.
 2  5245                 COMMISSIONER CARDOZO:  Thanks.
 3  5246                 MR. deSILVA:  May I add a very quick
 4     addition to that -- and no plugs, I promise, in this
 5     comment.
 6  5247                 Rita's comment about it being our job
 7     I think is very, very important here because I think
 8     this question of reflecting diversity, which also goes
 9     back to Commissioner Pennefather's earlier question and
10     yours, Commissione Cardozo, is that in the broader
11     system I believe it is at the moment nobody's job,
12     quite frankly.  No one is charged with that to reflect
13     diversity.  There is I think in principle support for
14     the idea, but I think a phrase was used earlier, "if it
15     can't be measured it is not there", and I think the
16     other phrase is, if it is everybody's job, it is
17     nobody's job I think in the system.
18  5248                 The examples I think it may be worth,
19     just for the record, to have perhaps examined are the
20     establishment of particular departments for cultural
21     diversity in Channel 4, for instance, the BBC, SBS in
22     Australia.  When Channel 4 established its Department
23     of Cultural Diversity and Multiculturalism, there was a
24     fear that it would ghettoize those programs, that all
25     programs that had a cultural diversity aspect to them


 1     would only be sent to that department.  But the actual
 2     truth of the matter, the result was that when it
 3     started to attract audience, the BBC decided that it
 4     had to get into the game as well.  That netted in a
 5     tremendous increase in terms of work for producers from
 6     diverse backgrounds, subject matter that wound up on
 7     the network and a general increase in the diversity of
 8     the system.
 9  5249                 I put forward that as a suggestion to
10     be examined for increasing diversity in the system as a
11     whole.
12  5250                 THE CHAIRPERSON:  Counsel.
13  5251                 MS PATTERSON:  Thank you, Madam
14     Chair.
15  5252                 It would be useful to know, if as you
16     propose the Commission were to establish documentaries
17     as a separate category, would you be willing to accept
18     the definition used by Telefilm Canada as a working
19     definitionfor that category?
20  5253                 MR. FRASER:  Yes.
21  5254                 MS PATTERSON:  Thank you.
22  5255                 Also, I believe it was Mr. Hanley who
23     first mentioned the letter recently received by you
24     from the Canadian Television Fund.  Would you be
25     prepared to file that with the Commission by the 15th


 1     of October?
 2  5256                 MR. FRASER:  I certainly would be
 3     happy to do that.  I have a copy right here.  We have
 4     many copies.  I had the impression you might have had
 5     it already, but I will walk it right across the room.
 6  5257                 MS PATTERSON:  Excellent, thank you.
 7  5258                 Thank you, Madam Chair.
 8  5259                 THE CHAIRPERSON:  Thank you.
 9  5260                 Thank you, ladies and gentlemen, for
10     your patience and waiting for us till after lunch.
11  5261                 MR. FRASER:  We thank you, and thank
12     you for giving us good attention.  Merci.
13  5262                 THE CHAIRPERSON:  Madam Secretary,
14     would you invite the next participant, please.
15  5263                 MS BÉNARD:  Thank you, Madam Chair.
16  5264                 The next presentation will be from
17     the Canadian Independent Film Caucus.
18  5265                 THE CHAIRPERSON:  Good afternoon,
19     madam, sir.  Proceed when you are ready.
21  5266                 MS COHEN:  Good afternoon, and thank
22     you for inviting the Canadian Independent Film Caucus
23     to address you at these important hearings.
24  5267                 My name is Barri Cohen.  I am a
25     longstanding member of the Canadian Independent Film


 1     Caucus and I am on the National Board and part of the
 2     Policy Subcommittee.  My colleague with me today is
 3     Geoff Bowie, who is also a longstanding member,
 4     National Board member and on the Policy Committee, and
 5     I must say also primarily responsible for the bulk of
 6     the research and development of the brief that you
 7     would have read and that we submitted to you.
 8  5268                 I am going to speak for a few moments
 9     and then I will pass it on to Geoff; and then, if there
10     is time, hopefully I could summarize some of the
11     recommendations that you would have before you.
12  5269                 The Canadian Independent Film Caucus
13     is a not-for-profit association of more than 300
14     filmmakers and producers from across Canada, in
15     chapters from Vancouver to Halifax, whose primary
16     production activity is documentary.  It was founded in
17     1983 by 14 filmmakers, newly independent from the
18     National Film Board of Canada, who came together to
19     fight the policy at Telefilm's new Broadcast Fund at
20     that time that excluded documentary programs from any
21     investment funding.
22  5270                 It took us two years, but we fought
23     and won that battle, the first of many.  Indeed, since
24     then, on our watch, a happy coincidence shall we say
25     has occurred:  the growth in documentary form, its


 1     diversity, the growth in windows here and abroad --
 2     also, I must say that I take some personal pleasure in
 3     this sort of documentary day today before the
 4     Commission.  Having been a participant in a number of
 5     interventions since 1993, I must say this is probably
 6     the first time I have come across even the mention of
 7     the word in so many briefs across the industry.  So I
 8     am quite pleased about that personally.
 9  5271                 Our members, many of whom are indeed
10     also members of the CFTPA, are not publicly-traded
11     companies, as you probably could gather, they are not
12     vertically integrated; they are small- and medium-sized
13     artists and entrepreneurs of a very broad range.  Some
14     are indeed mini studios who make a mix of documentary,
15     one-offs, miniseries, documentary, light fare, magazine
16     shows, to dramas for prime time, movies of the week,
17     current affairs and educational programs.  But the
18     majority are filmmakers who will spend, as you have
19     probably gathered from what you have heard already
20     today and from some of the case studies in our brief,
21     anywhere from two to five years or more in some cases,
22     almost single-handedly researching, fundraising,
23     filming and delivering their programs to broadcasters.
24  5272                 Indeed, one of jobs has been arguing
25     for and defending a style of documentary, or shall I


 1     say a representation of documentary in prime time that
 2     has only in recent years made its appearance.
 3  5273                 For us, the definition of
 4     "documentary" -- and we always know these things when
 5     we see them, but I will take a stab at it.  We have
 6     circulated for a number of years and we have had
 7     tremendous input into the Canadian Television Fund's
 8     definition, both the one used by the Cable Fund
 9     previously and Telefilm Canada, and that is -- so I am
10     amending; it is not amending that, I am adding to that:
11                            "an entertaining and politically
12                            and intellectually challenging
13                            storytelling form where story,
14                            dramatic structure, character,
15                            theme, in a singular vision or
16                            filmmaking style, are in myriad
17                            ways as every bit as complex, in
18                            construction and form, as drama
19                            and features." (As read)
20     If you sat and edited for six months, you would know
21     that, that you are basically constructing a story,
22     almost ex nihilo in some cases.
23  5274                 Our subject matters are drawn from
24     filmmakers' personal, political and aesthetic
25     commitments and passions.  This means addressing human


 1     issues, as Ms Deverell put it, about the world and
 2     about Canada with a rooted Canadian perspective that,
 3     in many cases, is and should be made explicit.  People
 4     talk about the Canadian perspective to programming; it
 5     is one that should be made explicit within the course
 6     of the program.
 7  5275                 The core of our recommendation to
 8     you, as echoed by various interveners, is something we
 9     have tried for almost three years to draw to your 
10     attention, and that is the inclusion of documentary as
11     an eligible content category under Option B in the
12     exhibition requirements; in other words, as
13     entertainment in the prime time schedule.
14                                                        1440
15  5276                 We have noted that this has been
16     supported by, among others, the DGC, the CFTPA, the
17     Canadian Association of Broadcasters and others.  I
18     think Alliance and Craig as well.  The intent is to
19     bring these films, obviously, to Canadian audiences.
20  5277                 Now, before I turn it over to Geoff,
21     I just want to say a few other remarks.  If the goal of
22     the system is to increase the amount of high-quality
23     Canadian content and cultural content available in
24     broadcasters' peak period schedules and if a key
25     problem is how to afford this now and into the future,


 1     then it's our position that the relatively low cost and
 2     high quality of documentaries is not the solution, but
 3     one very viable solution.
 4  5278                 Now, rather than list the many points
 5     we support in the interventions, particularly of the
 6     Director's Guild of Canada, the CFTPA and others at
 7     this point, I would like to turn over to Geoff now, who
 8     will share with you an e-mail that we received recently
 9     from a fellow documentary filmmaker from Quyon, Quebec,
10     not far from here, actually, who is a member of our
11     organization.  While perhaps this e-mail is a bit
12     lacking in sophistication, we appreciated his honesty
13     and his fresh perspective and we hope you do, too, and
14     take it in the spirit in which it was intended and also
15     to demonstrate that we are not just a dry bunch of
16     filmmakers.
17  5279                 Geoff?
18  5280                 MR. BOWIE:  This letter came through
19     the e-mail the other day.  I will skip the introductory
20     paragraph.  It comes in:
21                            "When my wife and I take stock
22                            of everything the Canadian
23                            Association of Broadcasters is
24                            recommending, a strangely skewed
25                            upside-down picture takes shape. 


 1                            It's worse than our farm house.
 2                            The corners don't meet, the
 3                            proportions are all off and it
 4                            shouldn't even stand up.
 5                                First, the CAB really thinks
 6                            the private broadcasters should
 7                            carry less Canadian programming. 
 8                            They want a 200 per cent time
 9                            credit at night for anything
10                            that appears to be Canadian. 
11                            This effectively cuts the number
12                            of shows by half.  Then they
13                            want an additional 150 per cent
14                            time credit in the day, plus
15                            they want to eliminate 2.5 hours
16                            of daytime Canadian content for
17                            every additional half hour of
18                            identifiably Canadian 200 per
19                            cent time credit entertainment
20                            programming, they add in prime
21                            time and they want infomercials
22                            to count as part of their Cancon
23                            obligations.  It makes you want
24                            to shake your head.
25                                They ask for this ability to


 1                            reduce the amount of Canadian
 2                            programming at a time when more
 3                            than 75 per cent of their peak
 4                            period entertainment programming
 5                            right now is filled with
 6                            American programming.  They
 7                            reason this reduction of
 8                            available Canadian content will
 9                            somehow result in more Canadians
10                            watching Canadian shows.  This
11                            really made the house spin. 
12                            It's like we are living in a
13                            Buster Keaton movie.
14                                When the CAB dreams at
15                            night, they must see the largest
16                            Canadian television stations
17                            broadcasting one really great
18                            expensive Canadian show and the
19                            whole national watching and for
20                            maybe an hour a day we all
21                            remember who we are and where we
22                            are and take pride in our
23                            feeling of community.  It's like
24                            that line about washing.  We
25                            take a bath twice a year whether


 1                            we need it or not.
 2                                Did I say expensive?  Yes,
 3                            that Mountie show is expensive
 4                            and the stockbroker show.  They
 5                            are both pretty dear, I bet, but
 6                            not for the private
 7                            broadcasters.  They would pay
 8                            less for their super-Canadian
 9                            Mounties and stockbrokers.  They
10                            don't want their licence fees to
11                            nudge a decimal point above 20
12                            per cent of the cost of the show
13                            and they sure want to continue
14                            their free money deal at the CTF
15                            where the licence fee top-up
16                            paid by the CTF counts as part
17                            of their Canadian program
18                            spending obligations.  That's a
19                            good one.
20                                Then with those licences
21                            low, they want to invest equity
22                            and they want that to be
23                            deducted from their Canadian
24                            program expenditure
25                            requirements, too.  Pretty


 1                            risky.  Then there is promotion. 
 2                            If they spend anything on
 3                            promotion on their Canadian
 4                            shows, even those don't worry
 5                            there is no sign they are
 6                            Canadian Canadian shows, they
 7                            want that to be excluded from
 8                            their allowable hourly
 9                            advertising time, count toward
10                            their expenditure obligations --
11                            and the wife went crazy over
12                            this one -- count towards their
13                            Cancon exhibition requirements,
14                            too, and they do it with a
15                            straight face.
16                                Don't forget now, from the
17                            way I read the Commission's
18                            figures, the private guys are
19                            asking for these expense-saving
20                            measures while their profits
21                            have climbed by 52 per cent over
22                            the last five years, thank you
23                            very much, and their investment
24                            in Canadian entertainment
25                            programs in that time increased


 1                            by, get this, one per cent.
 2                                I know the Broadcasting Act
 3                            has a phrase about maintaining
 4                            strong and economically viable
 5                            private broadcasting interests,
 6                            but what about all those other
 7                            phrases, cultural sovereignty,
 8                            national identity, the airwaves
 9                            as a national public resource,
10                            the importance of a strong
11                            independent production sector,
12                            and I don't mean just a few big
13                            companies publicly traded and
14                            vertically integrated, but a
15                            strong sector in all of its bio-
16                            diversity made up of all kinds
17                            of companies, including mine.
18                                Hello.  The Commission's job
19                            is more than improving the
20                            bottom line of the private
21                            broadcasters and their corporate
22                            expansion.  That's right,
23                            corporate expansion.  Despite
24                            the success of the independent
25                            production sector and the


 1                            private broadcaster's chronic
 2                            allergy to produce Canadian
 3                            appearing entertainment
 4                            programming, they now imply the
 5                            only way to make successful
 6                            distinctly Canadian programming
 7                            is if they produce and
 8                            distribute it themselves.  If
 9                            they get their hands on public
10                            money to make their own
11                            television shows, independent
12                            filmmakers might as well take up
13                            cod fishing.  A lopsided, loopy
14                            picture, indeed.  That's the way
15                            I see it, anyway.
16                                I hope this is of some help. 
17                            Good luck."
18  5281                 That was the letter we got.
19  5282                 MS COHEN:  Thank you, Geoff.  We
20     promised anonymity.  I hope you understand why.
21  5283                 Just to bring our remarks here to a
22     conclusion, the outcome of this Canadian television
23     policy review has to, obviously, lay a strong and solid
24     structural foundation for the broadcaster, the BDUs,
25     technology providers and the independent production


 1     sector players to move into the future as equal
 2     partners, rather than warring combatants.  This cannot
 3     be achieved by following the American model of
 4     encouraging greater and greater consolidation and
 5     vertical integration.  This is a losing game for Canada
 6     as even our biggest only become their smallest.  This
 7     approach will lead to the further Disneyfication of the
 8     world and withering away of the diversity and
 9     distinctiveness of Canadian cultural expression.
10  5284                 Now, with that in mind, just to
11     briefly summarize our conclusions, if I can just find
12     them here, one certainly that we mentioned was the core
13     of including documentaries in Option B -- I think it's
14     the 7:00 to 9:00 categories -- and having either a
15     separate category, as Vision recommended.  Certainly, I
16     think that's the way to go.  That was in the brief.
17  5285                 The other thing is that private
18     broadcasters exhibit 50 per cent Canadian content and
19     cultural content during peak hours and that news
20     essentially not be included in that time frame.  So,
21     from 6:00 to 7:00 the time credits that they are
22     getting, and from 10:00 11:00, that should be seriously
23     rethought at the very least.
24  5286                 Licence fees.  You have heard a lot
25     about licence fees.  No doubt you will continue to hear


 1     a lot about licence fees in large part because you have
 2     provided the evidence for us to make these arguments
 3     that the licence fees, the overall expenditures, even
 4     in the disaggregate form or the undisaggregate form, is
 5     not adequate proportional to profits.  We need this
 6     kind of investment today and in the future, both to
 7     meet new technology challenges and also to maintain the
 8     diversity in the system and that the exhibition
 9     requirements should be primarily supplied by
10     independent producers.
11  5287                 In terms of access to the funds,
12     these broadcasters should not have direct access to
13     these funds; in other words, that only public and
14     private continue to be accessed through us.  We would
15     also say that we wish to maintain the benefits package
16     on the transfer of ownership.  This has been really
17     crucial for us in the past.
18  5288                 Certainly, to take a very obvious
19     example, the creation of the Rogers Documentary Fund,
20     which, as you will see at least in one of our case
21     studies, if not in a few of them, was pretty important
22     in supplementing funding.  I think also this money can
23     be used to help in the transition to digital, something
24     that you have raised earlier in the day, and that there
25     needs to be some kind of accountability in the system;


 1     for example, the situation of Vision TV being moved up
 2     sort of on the dial.  I think we speak for most
 3     Canadians and most consumers that there seemed to be no
 4     accountability around that manoeuvre.
 5  5289                 I think I will stop there at this
 6     point and turn it over to you for questions.  Thank
 7     you.
 8  5290                 THE CHAIRPERSON:  Thank you, Ms.
 9     Cohen and Mr. Bowie and the gentleman from Quyon.
10  5291                 Commissioner McKendry?
11  5292                 COMMISSIONER McKENDRY:  Thank you,
12     Madam Chair.
13  5293                 Good afternoon and thank you for
14     spending your Saturday afternoon with us.  We
15     appreciate you taking the time.
16  5294                 You mentioned your cases studies and
17     you tied the case studies to the Rogers fund that
18     exists for documentaries.  I wanted to start off by
19     asking you about the cases.  I found them interesting
20     and you do make the point that they suggest a number of
21     points for us and I guess you just provided me with one
22     of those points.
23  5295                 I am just wondering if you can take a
24     couple of minutes and review those case studies.  Are
25     there any other points?  For example, I don't think the


 1     Rogers Fund is explicitly mentioned in your written
 2     brief.  Is there anything out of those case studies in
 3     particular that you want to bring to our attention?
 4  5296                 MR. BOWIE:  I think one of the points
 5     about the case studies is that kind of mix of funding
 6     elements that are there, that are necessary.  None of
 7     the films get made simply.  Shelley Saywell's film has
 8     two broadcasters, one Canadian, the CBC, and one
 9     Finnish TV.  Telefilm is involved, LFP is involved, the
10     Rogers Fund is involved and CBC had equity in the
11     project.
12  5297                 The neverending referendum had three
13     broadcasters involved, the National Film Board,
14     Telefilm, Cable Fund.  There is really a blend of
15     public and private, but the public money that is there
16     is just crucial to every case study.  I think anything
17     we can do to streamline and make it easier to finance
18     these shows without having quite so many sources will
19     certainly be more efficient.
20  5298                 Now often a lot of time goes into the
21     financing of the project and then the creative part
22     gets squeezed down.  As soon as the financing is in
23     place, you have to deliver the show fairly quickly. 
24     So, I would say that I emphasize the importance of
25     public money being available for this kind of


 1     production.
 2  5299                 In the case studies there is sort of
 3     a variety of how attractive the documentaries are for
 4     the international market.  I think you spoke earlier
 5     with Vision about distinctively Canadian shows and the
 6     super-Canadian emphasis and how do we make shows for a
 7     Canadian audience that also appealed to an
 8     international audience because you might need a large
 9     funding base drawing on international partners in order
10     to get the show done.
11  5300                 There is no easy solution to that,
12     but I think that we should be as Canadian as we can be
13     and that's what we have to contribute to the
14     international scene as the Canadian perspective.  It's
15     not like Canadian subjects will not interest anybody in
16     other countries.  I think Canada, even the fact that we
17     know more about the United States than anywhere else in
18     the world is probably a valuable contribution to make
19     to the rest of the world.
20  5301                 I don't know if I have answered your
21     question.
22  5302                 MS COHEN:  I would just like to add
23     to that that it underscores, I think, symptomatically
24     one of the recommendations that we have, which is that
25     licence fees are too low excluding equity, but if you


 1     have a larger player, then you are not necessarily
 2     chasing $5,000 from SCN or $8,000 from this educational
 3     broadcaster and juggling your different windows. 
 4     That's sort of endemic to the system to a certain
 5     degree, but, yes, they can be rationalized to a certain
 6     extent.
 7  5303                 Higher licence fees is one way to do
 8     it, but it also will have other, I think, implications,
 9     which is that if there can be a concomitant lowering of
10     contributions from the Canadian Television Fund, then
11     you have more funds available for hopefully more
12     productions.  We know the pie is a limited pie, but one
13     of the ways in which, I think, to make the most of it
14     is to make the broadcasters carry their fair weight
15     with respect to what other broadcasters in the world
16     are paying with similar markets.  So, that's certainly
17     one thing.
18  5304                 COMMISSIONER McKENDRY:  You mentioned
19     streamlining the number of sources, which I take it to
20     be reducing the number of sources because it's complex
21     and time-consuming to put together a package.  What
22     would be the key recommendation you have with respect
23     to streamlining?
24  5305                 MR. BOWIE:  I would say that higher
25     licence fees is the biggest part.  Certainly I think


 1     our position is the best way for a broadcaster to
 2     prioritize their project at any of the funds is by
 3     giving it a higher licence fee and that way it's easier
 4     to fund and it will be funded more quickly and they can
 5     guarantee their show will be done if they boost the
 6     licence fee.  I would say that would be the first and
 7     foremost recommendation.
 8  5306                 COMMISSIONER McKENDRY:  Thank you.
 9  5307                 Now I want to pick up on a point you
10     made where you said that your documentary should be as
11     Canadian as we can be.  I was a bit perplexed and I am
12     going to ask you to help me with page xvii of your
13     submission.  I want to make sure that I understand this
14     correctly taking into account the comments you have
15     made.  I am looking at paragraph 77, the last sentence,
16     and I will quote it:
17                            "But with documentaries,
18                            agencies should not restrict the
19                            definition of Canadian content
20                            to programs that are exclusively
21                            shot in Canada, and limited to
22                            Canadian subjects."  (As read)
23  5308                 To use an extreme example to make my
24     point, I take that to mean that it would be possible
25     that a Canadian could go to Australia, the Canadian


 1     could shoot a documentary about the impact of
 2     deforestation of eucalyptus trees and koalas and then
 3     have the documentary recognized as Canadian content. 
 4     Under your recommendation, in fact, it would qualify as
 5     150 per cent Canadian content.
 6  5309                 Now, I have two questions flowing out
 7     of that.  Just above making that statement you
 8     criticize "Nikita" and "Sci Factor" as not being
 9     distinctively Canadian.  My first question is:  How do
10     you reconcile your position on documentaries taking
11     into account the example I gave you with your position
12     on the documentaries such as "Nikita" and so on?
13  5310                 MS COHEN:  I think there is always
14     going to be judgment calls on these things and while we
15     have received assurance from the Canadian Television
16     Fund -- informally received assurance that the same
17     criteria they have been using to show flexibility
18     around the definition of "documentary", they do intend,
19     they have said again informally, to extend that for us
20     so that there will be an understanding that a Canadian
21     crew that is interested in, say, something that is of
22     broad international importance of some kind would be
23     considered Canadian.
24  5311                 I think the problem with what I call
25     the AmeriCancon, the "Sci Factors" and the femme


 1     "Nikitas" and so on, apart from the fact that it has
 2     allowed at least one company to be enormously
 3     capitalized on our dollars and while it has had
 4     tremendous benefit keeping an industry going and
 5     keeping people skilled and all of that, it hasn't
 6     really added anything to our sort of general sense of
 7     ourselves.  What I think we want to move towards with a
 8     definition of a Canadian documentary is one in which
 9     the filmmaker's point of view and perspective as a
10     Canadian -- I don't care what kind of hyphenated
11     Canadian, but as a Canadian is brought to bear on the
12     subject matter.
13  5312                 Now, with respect to your example in
14     Australia, the question that would have to be asked,
15     even in a so-called market-driven fund -- it's not
16     going to be adding up a bunch of points really, but the
17     question that would have to be asked is:  Does that
18     issue or story have international relevance?  Does it
19     have relevance for Canadians?  Do we have our own
20     deforestation issues that have to be dealt with?  What
21     are the links between deforestation in Australia and
22     deforestation in B.C.?  Those are the kinds of links.
23  5313                 I am not saying necessarily following
24     a story in B.C., although that may be a perfect thing
25     to do.  Some of the constraints of the system can


 1     create creative solutions.  First of all, I don't know
 2     why a broadcaster would be interested in deforestation
 3     in Australia solely or the depletion of cod fishery in
 4     Portugal when we have our own tragedy to talk about,
 5     unless it's a comparison and an inclusion.
 6                                                        1500
 7  5314                 I think it would not be difficult to
 8     make these distinctions.  There will always be
 9     challenges.  There will always be a film or a program
10     that will push against the envelope, especially if it
11     is produced by high profile producers.
12  5315                 There is the politics of this system
13     which has to do with the higher profile producers who
14     get to traipse across the world and do as they wish
15     because they win the awards, they get the dough, and
16     all of that.  Whereas the up and comers and maybe the
17     Jeannette Loakmans don't because she does not have that
18     kind of profile.
19  5316                 I must say that that does enter into
20     the overall ecology of the system.
21  5317                 MR. BOWIE:  I want to add that if you
22     imagined a "Nikita" or a "psi Factor" not being shot in
23     Canada, then what do you have?  You have no benefit.
24  5318                 The difference in production
25     logistics -- you have a small documentary crew that can


 1     go away to a foreign country and shoot something from a
 2     Canadian perspective.  I support what Barrie said about
 3     if it is Australian deforestation, then it had better
 4     be connected.  The Canadian perspective has to be there
 5     in some way or else it is not a Canadian documentary.
 6  5319                 COMMISSIONER McKENDRY:  So I take it
 7     the criteria, in your minds, would not be quite as
 8     stark as they are set out in paragraph 77.  There would
 9     be the Canadian perspective element that should be
10     taken into account.
11  5320                 MR. BOWIE:  Yes.  I think we go on,
12     in paragraph 78, to clarify that those are the criteria
13     that we mean.
14  5321                 I think the real intention of the
15     super-Canadian regulation is for the "psi Factors" and
16     the "Nikitas" to try to make the drama, which take the
17     lion's share of the money anyway, more relevant to
18     Canadians.  They want them to be shot in Canada
19     clearly.  Whereas I don't think that should just be,
20     holus bolus, applied to documentary.  I think the
21     documentary tradition has certainly never been that
22     every documentary that gets made has to be shot in
23     Canada in order to be Canadian.
24  5322                 COMMISSIONER McKENDRY:  On this
25     point, if I understood Mr. Fraser in the previous


 1     panel, clearly they were discussing the same situation
 2     in the context of Canadian documentary makers being
 3     able to go outside the country and shoot a film outside
 4     the country and get recognition for it.
 5  5323                 I took it that his position was that
 6     the criteria should be the primary audience.  I think
 7     he said the primary audience should be the determining
 8     factor.
 9  5324                 I took from that that if the
10     filmmaker is going out and has in mind that the primary
11     audience will be Canadians, that that would be
12     sufficient.  I hope I am not misinterpreting what he
13     said.
14  5325                 Does that position have merit, in
15     your view?
16  5326                 MR. BOWIE:  Yes, it does.  Again, we
17     run into the practical problems; that being that with
18     the licence fees as low as they are, if you want to do
19     a series that has a significant budget, it is very hard
20     to raise all the money in Canada.  Then you are raising
21     money from U.S. Discovery, or you are raising the money
22     from Channel 4.  And they often want to have the
23     subject dealt with from not just Canadian subjects;
24     they want to have a mix of Canadian with other
25     subjects.


 1  5327                 That is a practical problem that we
 2     run into, and I guess it is going to be a subjective
 3     decision by this board of the CTF, or anybody who is
 4     jurying this stuff, to figure out if it is in or out.
 5  5328                 MS COHEN:  It is also a judgment that
 6     the filmmaker/producers have with broadcasters prior to
 7     application.  It is part of the initial story meetings,
 8     if you will, about a particular project that a
 9     broadcaster may be interested in.
10  5329                 COMMISSIONER McKENDRY:  You touched
11     on this in your oral comments, and I just want to make
12     sure that we are clear on this in terms of our record.
13  5330                 We have been asking people who have
14     been coming before us talking about documentaries -- we
15     want to make sure we understand what they mean by
16     "documentary".
17  5331                 As I say, I think you touched on that
18     in your oral comments.
19  5332                 Are you happy with the definition
20     that the fund uses?  Is that acceptable to you?
21  5333                 MS COHEN:  Yes, I think so.  The
22     question needs to be asked -- how do I put this --
23     whether it has been applied fully in all cases.  That
24     is another issue.
25  5334                 I think, in part because we had a lot


 1     of input into that definition, it is one of the best
 2     definitions going right now.  So I think, on paper, we
 3     are pretty pleased with it.
 4  5335                 MR. BOWIE:  In our intervention we
 5     have a footnote saying:
 6                            "Whenever 'documentary' is
 7                            referred to in this brief, we
 8                            mean long form documentary over
 9                            30 minutes in length.  The CIFC
10                            and the Canada Television Cable
11                            Production Fund do not consider
12                            newsmagazine shows, current
13                            affairs programs, or extended
14                            journalistic pieces under 30
15                            minutes as documentaries.  The
16                            documentary is an art form where
17                            story, dramatic structure,
18                            character, theme, and filmmaking
19                            style are every bit as important
20                            as in the dramatic form."
21  5336                 I think the fund definition -- I
22     don't think it is as clear as this, but it is saying
23     the same thing.
24  5337                 COMMISSIONER McKENDRY:  You mentioned
25     that the fund has not been applied fully.  I was not


 1     clear what you meant by that.
 2  5338                 MS COHEN:  I would have to do a
 3     proper analysis of that to be fair.
 4  5339                 But there have been perhaps one or
 5     two cases where certain things that some people would
 6     have not considered documentaries got funded.  To talk
 7     about one or two cases, I don't think is fair, because
 8     overall it has been.  It has been a fairly well applied
 9     definition.
10  5340                 There have been a few instances
11     wheren the nature of the production team and the
12     viability of the project I think outweighed any
13     concerns around definition.
14  5341                 COMMISSIONER McKENDRY:  So your
15     message is that the definition should be rigorously
16     adhered to by the people administering the fund.
17  5342                 MS COHEN:  Yes.
18  5343                 COMMISSIONER McKENDRY:  And then you
19     are happy with the definition, or at least you can live
20     with the definition as long as it is rigorously adhered
21     to.
22  5344                 MS COHEN:  Yes.
23  5345                 COMMISSIONER McKENDRY:  As I
24     mentioned, we have been asking people who come before
25     us how they define a documentary.  You touched on this


 1     in your opening comments; that you were pleased to see
 2     that there were many more parties than you are
 3     accustomed to talking about documentaries and being
 4     supportive.
 5  5346                 What do you think is underlying this
 6     wave -- I don't know how big this wave is, but this
 7     wave of interest, I suppose, from a regulatory
 8     perspective in documentaries?  What has changed?
 9  5347                 MS COHEN:  Apart from the fact that
10     it is a boom; that everyone is talking about a boom --
11  5348                 Geoff, do you want to step in here?
12  5349                 MR. BOWIE:  Yes.  I think with the
13     development of specialty TV particularly here and in
14     the States, as well as in England, Channel 4, A&E, the
15     Learning Channel, the Discovery Channel, the History
16     Channel, as well as the CBC, TV Ontario and Vision,
17     they are all --
18  5350                 It is true that documentary people
19     work hard; they put a lot of effort into getting into
20     the subject in some depth, and they can do it
21     affordably.
22  5351                 I think that makes a lot of sense for
23     a lot of broadcasters, and it is drawing audiences.  I
24     think that is probably the main reason for this
25     increased interest.


 1  5352                 There is never enough money; so the
 2     more you can get out it, the better.
 3  5353                 MS COHEN:  I personally have not done
 4     this analysis.  I don't know if you thought through
 5     this.
 6  5354                 But if you actually looked at the
 7     amount of money spent and the kinds of audience
 8     returns, I think it is probably not a bad bang for
 9     buck, as the expression goes.
10  5355                 You don't want to clearly overload
11     the system with it as a way of fulfilling Canadian
12     content, if that is the subtext of your question. 
13     Clearly that would be a concern of fulfilling Canadian
14     content with nothing but documentaries.
15  5356                 I doubt that is going to happen.  It
16     would be nice, but I doubt that is going to happen. 
17     There should be diversity.  And it wouldn't be
18     appropriate either.
19  5357                 But because we recommend also that
20     prime time nightly, three hours, goes to Canadian
21     production, what we are basically saying is:  Increase
22     the window; increase the demand.  There should be,
23     hopefully, enough to more or less go around of quality
24     -- not just anyone who wants to produce anything, but
25     of quality -- and create a healthy environment of


 1     competition for that quality.
 2  5358                 As you know, the industry has grown
 3     enormously, and that competition is there.
 4  5359                 The other thing I would say, though,
 5     in terms of this boom is that it is a boom in a certain
 6     type of documentary as well.  There is some concern
 7     about the longer form, more traditional Film Board
 8     style documentary that was supported, which is still
 9     what filmmakers wish to do.  There is some pressure on
10     that because of downward pressure on licence fees and
11     because of, in some cases, not enough time being
12     devoted to research and development and getting into
13     the subject; and also some resistance, in a very
14     general sense, on the part of broadcasters allowing
15     some broadcasters -- certainly not Vision and TV
16     Ontario -- that distinctive Canadian, or shall I say
17     filmmaker perspective in the work.
18  5360                 I am splitting hairs here about
19     genres, distinctions within the broader genre.
20  5361                 Anyway, this boom is not here; it is
21     also elsewhere.  It is in Europe as well.  There is a
22     boom in nature programming, and it is driven by
23     specialty channels who have just done a tremendous
24     amount, particulary Discovery.
25  5362                 MR. BOWIE:  I want to add that the


 1     biggest lack, which is fairly clear in our document, is
 2     on the private conventional broadcasters.  There is
 3     practically no documentary.  We don't know if there is
 4     a barrier in the way that Option B has been worded up
 5     until now; and if that can change, there is the
 6     possibility that they will be more interested in
 7     documentary.
 8  5363                 We certainly don't know if that is
 9     the case.  But at least if that barrier is removed,
10     then it is a level playing field.
11  5364                 COMMISSIONER McKENDRY:  It is your
12     view that if we only remove that barrier, that would
13     not be going as far as you would like us to go in terms
14     of what you hope we will do in this proceeding.
15  5365                 MR. BOWIE:  Yes.  I think it is a key
16     thing; very simply, that documentary be included among
17     the entertainment categories.  But also there are
18     licence fees, benefits packages, and the other
19     recommendations that we have made that I think will
20     help.
21  5366                 MS COHEN:  And increasing the window
22     in prime time.
23  5367                 MR. BOWIE:  The key thing we are
24     looking for with the CTF is that the documentary is no
25     longer in the 20 percent category but is part of the 80


 1     percent category.  The broadcaster can decide what they
 2     want to make.
 3  5368                 COMMISSIONER McKENDRY:  The Canadian
 4     Association of Broadcasters told us they are willing to
 5     pay performance bonuses to producers whose programs
 6     perform better than anticipated.
 7  5369                 Is that something that you would
 8     support?
 9  5370                 MR. BOWIE:  Yes, it is a very good
10     idea.
11  5371                 COMMISSIONER McKENDRY:  Would you
12     support the other side of the coin; that if they don't,
13     there is some sort of --
14  5372                 MS COHEN:  No.  That is the risk of
15     licensing something.
16  5373                 What would they suggest?  What would
17     the levy, the punishment be?
18  5374                 COMMISSIONER McKENDRY:  I don't think
19     they did suggest that.
20  5375                 MR. BOWIE:  No, they didn't.  I think
21     rewarding success is a good idea.  If you have too many
22     failures, then you are not going to be asked to do
23     anything else.
24  5376                 MS COHEN:  But all things being
25     equal.  It depends on promotion.  There are a lot of


 1     complex factors in what is going to draw an audience.
 2  5377                 One thing that is true about the
 3     private broadcasters is that once they make a
 4     commitment to a documentary, the few times that Global
 5     has, or the few times that CTV has -- the basic
 6     conventional private broadcasters -- their promotion is
 7     very good.
 8  5378                 I cannot say that about all of them. 
 9     And that is key.  So all things being equal,
10     performance should be in tandem with promotion
11     performance too.  Then let's see what kinds of rewards
12     accrue.
13  5379                 COMMISSIONER McKENDRY:  Thank you
14     very much.  Those are the questions I have for you.
15  5380                 Thank you, Madam Chair.
16  5381                 THE CHAIRPERSON:  My recollection is
17     that the CAB did suggest some type of negotiated
18     default.  I assume that that is what you say; that you
19     have taken the risk by deciding ahead what you think
20     you are going to achieve with the program you license
21     and that should be sufficient.
22  5382                 MS COHEN:  It is a partnership.  They
23     have been telling us that it is a partnership all the
24     way along, and the partnership should also extend to
25     reaching the broadest audience possible.


 1  5383                 THE CHAIRPERSON:  I cannot find the
 2     reference right now.
 3  5384                 COMMISSIONER McKENDRY:  Madam Chair,
 4     when it did come up on the record -- it may have come
 5     up from the Canadian Association of Broadcasters, but
 6     Mr. MacMillan from Alliance pointed out to us that he
 7     in fact had entered into arrangements with broadcasters
 8     where he had agreed to accept a lower fee if in fact it
 9     did not perform as well as it should.
10  5385                 At the same time, he said he had in
11     the same deals negotiated a performance bonus.
12  5386                 I cannot really recall whether CAB --
13  5387                 MS COHEN:  Hypothetically, if such a
14     thing were to be instituted -- I mean, it's one thing
15     to expect a very well-cushioned creature like AAC to
16     take such a thing.  We are not well-cushioned that way.

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