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Please note that the Official Languages Act requires that government publications be available in both official languages.
In order to meet some of the requirements under this Act, the Commission's transcripts will therefore be bilingual as to their covers, the listing of CRTC members and staff attending the hearings, and the table of contents.
However, the aforementioned publication is the recorded verbatim transcript and, as such, is transcribed in either of the official languages, depending on the language spoken by the participant at the hearing.
TRANSCRIPT OF PROCEEDINGS BEFORE
THE CANADIAN RADIO‑TELEVISION AND
TELECOMMUNICATIONS COMMISSION
TRANSCRIPTION DES AUDIENCES DEVANT
LE CONSEIL DE LA RADIODIFFUSION
ET DES TÉLÉCOMMUNICATIONS CANADIENNES
SUBJECT/SUJET:
DIVERSITY OF VOICES PROCEEDING /
AUDIENCE SUR LA DIVERSITÉ DES VOIX
HELD AT: TENUE À:
Conference Centre Centre de conférences
Outaouais Room Salle Outaouais
Portage IV Portage IV
140 Promenade du Portage 140, promenade du Portage
Gatineau, Quebec Gatineau (Québec)
September 17, 2007 Le 17 septembre 2007
Transcripts
In order to meet the requirements of the Official Languages
Act, transcripts of proceedings before the Commission will be
bilingual as to their covers, the listing of the CRTC members
and staff attending the public hearings, and the Table of
Contents.
However, the aforementioned publication is the recorded
verbatim transcript and, as such, is taped and transcribed in
either of the official languages, depending on the language
spoken by the participant at the public hearing.
Transcription
Afin de rencontrer les exigences de la Loi sur les langues
officielles, les procès‑verbaux pour le Conseil seront
bilingues en ce qui a trait à la page couverture, la liste des
membres et du personnel du CRTC participant à l'audience
publique ainsi que la table des matières.
Toutefois, la publication susmentionnée est un compte rendu
textuel des délibérations et, en tant que tel, est enregistrée
et transcrite dans l'une ou l'autre des deux langues
officielles, compte tenu de la langue utilisée par le
participant à l'audience publique.
Canadian Radio‑television and
Telecommunications Commission
Conseil de la radiodiffusion et des
télécommunications canadiennes
Transcript / Transcription
DIVERSITY OF VOICES PROCEEDING /
AUDIENCE SUR LA DIVERSITÉ DES VOIX
BEFORE / DEVANT:
Konrad von Finckenstein Chairperson / Président
Michel Arpin Commissioner / Conseiller Rita Cugini Commissioner / Conseillère
Andrée Noël Commissioner / Conseillère
Ronald Williams Commissioner / Conseiller
Stuart Langford Commissioner / Conseiller
Michel Morin Commissioner / Conseiller
ALSO PRESENT / AUSSI PRÉSENTS:
Chantal Boulet Secretary / Secrétaire
Nick Ketchum Hearing Manager /
Gérant de l'audience
Shari Fisher Legal Counsel /
Bernard Montigny Conseillers juridiques
HELD AT: TENUE À:
Conference Centre Centre de conférences
Outaouais Room Salle Outaouais
Portage IV Portage IV
140 Promenade du Portage 140, promenade du Portage
Gatineau, Quebec Gatineau (Québec)
September 17, 2007 Le 17 septembre 2007
- iv -
TABLE DES MATIÈRES / TABLE OF CONTENTS
PAGE / PARA
INTERVENTION BY / INTERVENTION PAR:
CBC / Radio-Canada 7 / 45
Canadian Association of Broadcasters 60 / 369
CTVglobemedia 122 / 691
CanWest MediaWorks Inc. 168 / 938
Shaw Communications Inc. 216 / 1218
Gatineau (Québec) / Gatineau, Québec
‑‑‑ L'audience débute le lundi 17 septembre 2007
à 0857 / Upon commencing on Monday,
September 17, 2007 at 0857
LISTNUM 1 \l 11 THE SECRETARY: Please, be seated. We will be commencing in a couple of seconds.
LISTNUM 1 \l 12 Thank you.
LISTNUM 1 \l 13 THE CHAIRPERSON: Good morning, ladies and gentlemen.
LISTNUM 1 \l 14 Welcome to this public hearing on diversity of voices.
LISTNUM 1 \l 15 Today's panel is made up of Michel Arpin, Vice‑Chair, Broadcasting; Rita Cugini, Regional Commissioner of Ontario; Stuart Langford, National Commissioner; Michel Morin, National Commissioner; Andrée Noël, Regional Commissioner for Québec; Ronald Williams, Regional Commissioner for Alberta and Northwest Territories; and myself, Konrad von Finckenstein, as chairman.
LISTNUM 1 \l 16 L'équipe du Conseil qui nous assiste se compose notamment de Nick Ketchum, gestionnaire de l'audience et directeur principal, Radiodiffusion; Shari Fisher et Bernard Montigny, conseillers juridiques; et Chantal Boulet, secrétaire de l'audience.
LISTNUM 1 \l 17 The issue of media concentration is an important one that has preoccupied policy makers in Canada for some time.
LISTNUM 1 \l 18 Several studies have touched on the subject, most notably the Davey Report in 1970, the Kent Commission in 1981, the Lincoln Report in 2003 and the Fraser Report in 2006.
LISTNUM 1 \l 19 The concern over media concentration is not limited to Canada. Many other jurisdictions, including the United States and the European Union, are currently studying this issue, and Australia has recently passed new legislation.
LISTNUM 1 \l 110 Pourquoi la concentration des médias fait‑elle l'objet d'une telle attention ?
LISTNUM 1 \l 111 Tout simplement parce que la présence d'une diversité de voix s'avère essentielle au bon fonctionnement d'une démocratie.
LISTNUM 1 \l 112 Lorsque les personnes ont accès à l'information à partir de différents points de vue, elles sont mieux en mesure de participer aux débats publics et de devenir des citoyens bien informés et engagés.
LISTNUM 1 \l 113 C'est la première fois que le CRTC tient une audience pour examiner la politique globale de son approche sur la propriété des médias et son incidence possible sur la diversité des voix accessible aux Canadiens, et ce, au moment où la vague de fusions que connaît l'industrie de la radiodiffusion fait en sorte que les entreprises contrôlent non seulement un large éventail de médias traditionnels, mais également le contenu qu'elles peuvent diffuser sur leurs plateformes numériques.
LISTNUM 1 \l 114 The main purpose of this proceeding is to ensure that the broadcasting system provides Canadians with the greatest possible diversity of voices, and especially editorial voices.
LISTNUM 1 \l 115 Any policy guidelines that may be developed as a result of this proceeding should be simple, consistent and clearly articulated.
LISTNUM 1 \l 116 As you are all aware, the three major ownership transactions announced prior to March 13, 2007, will be considered under the existing rules and will not be affected by the guidelines arising from this proceeding.
LISTNUM 1 \l 117 The hearing starting today will focus on three key issues: the plurality of commercial editorial voices, the diversity of programming choices and the safeguards for journalistic content in situations where different media outlets in a given market are controlled by a single entity.
LISTNUM 1 \l 118 Those are our three major concerns.
LISTNUM 1 \l 119 When speaking of the plurality of voices, the Commission is referring to the number of editorial voices, including news and current events programming, owned by separate entities.
LISTNUM 1 \l 120 In Canada, the broadcasting system is divided into public, private and community elements, and each plays a role in informing the perspectives of Canadians on local, national and global affairs.
LISTNUM 1 \l 121 During this hearing, we will only examine the most effective means of ensuring that private broadcasters offer Canadians an appropriate num ber of different editorial voices.
LISTNUM 1 \l 122 The diversity of programming choices, on the other hand, refers to the content available to Canadians.
LISTNUM 1 \l 123 The Commission has different regulatory tools at its disposal to ensure that our broadcasting system offers diverse content to listeners and viewers.
LISTNUM 1 \l 124 We will be taking a broader look at our regulatory tools during upcoming proceedings, such as the review of our policies for discretionary services and BDUs and the licences renewal hearing.
LISTNUM 1 \l 125 Enfin, nous étudierons également l'efficacité des dispositifs en place concernant l'indépendance journalistique, ainsi que le Code d'indépendance journalistique que le Conseil canadien des normes de la radiotélévision a proposé.
LISTNUM 1 \l 126 The Commission will accept additional comments on the areas identified by the panel at the end of the oral hearing.
LISTNUM 1 \l 127 Parties will have until October 5 to submit their final written comments.
LISTNUM 1 \l 128 Now we have five very full days ahead of us. I will not bother you with any more speeches.
LISTNUM 1 \l 129 We will go right to the various interveners.
LISTNUM 1 \l 130 Madame Boulet, over to you.
LISTNUM 1 \l 131 THE SECRETARY: Thank you, Mr. Chairman, et bonjour à tous.
LISTNUM 1 \l 132 Seulement quelques petites annonces d'ordre procédural.
LISTNUM 1 \l 133 I would now ask you, if you have a blackberry or a beeper or a cell phone, if you could please turn it off. I would appreciate your cooperation throughout the hearing.
LISTNUM 1 \l 134 The simultaneous translation is available is available during this hearing. There are receivers available from the commissionaire outside this hearing room.
LISTNUM 1 \l 135 The English translation is on channel seven, and the French translation on channel eight.
LISTNUM 1 \l 136 We expect the hearing to take one week.
LISTNUM 1 \l 137 We will begin tomorrow morning at 8:30 a.m. and every other morning, and adjourn each afternoon at approximately 4:30 p.m.
LISTNUM 1 \l 138 We will take one hour for lunch, a break in the morning and in the afternoon.
LISTNUM 1 \l 139 Pendant toute la durée de l'audience, vous pourrez consulter les documents qui font partie du dossier public pour cette audience dans la salle d'examen qui se trouve dans la Salle Papineau, située à l'extérieur de la salle d'audience à votre droite.
LISTNUM 1 \l 140 Une transcription est aussi disponible sur notre site Internet à la fin de l'audience, ou vous pouvez vous en procurer une copie auprès de la compagnie Mediacopy en parlant peut‑être avec le sténographe qui est situé à ma droite.
LISTNUM 1 \l 141 Veuillez noter qu'un intervenant a été ajouté à l'horaire de cette audience pour mercredi. Il s'agit du Syndicat des travailleurs de l'information du Journal de Montréal.
LISTNUM 1 \l 142 We will now proceed with the presentation of CBC/Radio‑Canada. Appearing for CBC is Mr. Sylvain Lafrance.
LISTNUM 1 \l 143 Monsieur Lafrance, une fois que vous aurez présenté vos collègues, vous aurez dix minutes pour votre présentation.
LISTNUM 1 \l 144 Merci.
INTERVENTION
LISTNUM 1 \l 145 M. LAFRANCE : Merci beaucoup.
LISTNUM 1 \l 146 Monsieur le Président, Mesdames et Messieurs les Conseillers, au nom de la Société Radio‑Canada, il nous fait plaisir d'être présents ici ce matin pour discuter de cette très importante question qui est la diversité des voix.
LISTNUM 1 \l 147 Je suis Sylvain Lafrance, donc, vice‑président principal des Services français.
LISTNUM 1 \l 148 A ma gauche se trouve Jane Chalmers, vice‑présidente de la Radio anglaise.
LISTNUM 1 \l 149 Et à ma droite de monsieur Richard Stursberg, vice‑président principal de CBC télévision.
LISTNUM 1 \l 150 Et à la droite de monsieur Stursberg, Bev Kirshenblatt, première directrice, Affaires réglementaires.
LISTNUM 1 \l 151 Dans le cadre de ses audiences, le Conseil examine l'un des objectifs fondamentaux de la réglementation sur la radiodiffusion au Canada, soit la promotion d'un système de radio diffusion qui reflète la composition démographique du pays et qui garantit que les auditoires ont accès à une diversité de voix.
LISTNUM 1 \l 152 Comme nous l'avons expliqué dans notre mémoire, nous pensons que, dans le cadre de cet examen, le Conseil devrait porter une attention particulière à la contribution des diffuseurs publics pour assurer la diversité des voix, contribuant ainsi à la santé du système de radiodiffusion.
LISTNUM 1 \l 153 L'étude que nous avons faite de la situation dans d'autres pays ainsi que les études de portée internationales effectuées par d'autres parties dans le cadre de ces audiences confirment la reconnaissance du rôle important des diffuseurs publics en cette matière.
LISTNUM 1 \l 154 La présence d'un diffuseur public solide dans le système de radiodiffusion d'un pays constitue un contrepoids important à la concentration des médias et permet de s'assurer que la diversité des voix est bel et bien présente.
LISTNUM 1 \l 155 A titre d'exemple, dans une seule semaine de diffusion en 2007, la radio de Radio‑Canada dans ses seules émissions d'information reçoit près de 1500 invités différents. La télévision de Radio‑Canada, près de 900 invités différents.
LISTNUM 1 \l 156 Ça parle beaucoup de ce qu'est la diversité à la radio et à la télévision de Radio‑Canada.
LISTNUM 1 \l 157 Ce matin, nous aimerions discuter plus en détail de ce concept avec vous et vous donner des exemples concrets de la manière dont CBC/Radio‑Canada contribue à promouvoir la diversité des voix au Canada sur diverses plateformes, enrichissant ainsi la vie démocratique et culturelle des Canadiens.
LISTNUM 1 \l 158 J'aimerais m'arrêter un instant sur deux points cruciaux.
LISTNUM 1 \l 159 Premièrement, le caractère singulier du marché québécois, qui, de par sa taille réduite, son environnement médiatique hautement concentré et sa proximité avec les marchés anglophones qui l'entourent, constitue un défi pour le maintien d'une saine diversité des voix.
LISTNUM 1 \l 160 Vous savez déjà que l'intégration verticale entre les distributeurs et la télévision est très présente au Québec. Québécor contrôle Vidéotron, TVA et LCN. Cogeco contrôle TQS.
LISTNUM 1 \l 161 On sait aussi que le niveau de concentration des médias est particulièrement élevé sur le marché québécois.
LISTNUM 1 \l 162 Il n'est pas surprenant que le rapport de Nordicité conclut que, si on applique le système australien de calcul de concentration des médias, le marché métropolitain de Montréal est déjà en dessous du seuil acceptable.
LISTNUM 1 \l 163 On note cependant que cette méthode australienne de calcul n'inclut que les groupes de médias privés commerciaux.
LISTNUM 1 \l 164 Il ne tient donc pas compte de Radio‑Canada, qui joue un rôle absolument essentiel pour maintenir une diversité des voix dans un contexte où les médias au Canada, tout comme ceux de plusieurs autres pays, se concentrent de plus en plus.
LISTNUM 1 \l 165 Dans ce contexte, les avantages qu'apporte la radiodiffusion publique au système sont doublement importants.
LISTNUM 1 \l 166 Je me ferai un plaisir de discuter plus avant de ce point avec vous pendant la période de questions.
LISTNUM 1 \l 167 Le second élément est un point essentiel défini par le Conseil dans son avis public : le critère de l'accès raisonnable au système pour les entreprises canadiennes de programmation afin de promouvoir un système de radiodiffusion diversifié et sain.
LISTNUM 1 \l 168 Le défi que constitue la promotion de l'accès au système de la programmation canadienne n'a jamais été aussi grand, surtout dans le cas de la télévision.
LISTNUM 1 \l 169 Et soyons clairs sur ce point : il n'y a pas de liberté de parole sans la liberté d'être entendu. Il n'y a pas de diversité des voix sans une distribution équitable de ces voix.
LISTNUM 1 \l 170 La tâche du Conseil sera colossale, car plusieurs défis se présentent. D'abord, la quantité et la variété grandissantes de contenu étranger que l'on peut trouver sur Internet et sur les plateformes multimédias, puis la domination croissante de la programmation étrangère à la télévision canadienne anglaise, le contrôle accru du contenu des nouveaux médias par les distributeurs et par les entreprises de télécommunications qui distribuent ce contenu, et enfin les contraintes incessantes, liées à la petitesse du marché, auxquelles est soumise la programmation canadienne de langue française.
LISTNUM 1 \l 171 Nous discuterons avec vous plus en détail de certains de ces points dans le contexte de prochaines audiences.
LISTNUM 1 \l 172 Toutefois, nous souhaiterions souligner aujourd'hui au Conseil qu'il ne doit pas envisager la diversité des voix dans le seul contexte des genres de programmation ou des choix éditoriaux et de propriété, mais aussi dans le cadre plus large d'assurer un accès raisonnable au système pour la programmation canadienne.
LISTNUM 1 \l 173 La question de l'accès n'est pas une question technique ou une simple question de tuyaux. Elle est au coeur de la partie sociale et culturelle du mandat du CRTC.
LISTNUM 1 \l 174 Jane ?
LISTNUM 1 \l 175 MS CHALMERS : Thank you, Sylvain.
LISTNUM 1 \l 176 As we noted in our submission, UNESCO and the Council of Europe in their assessment of diversity and the role of public broadcasting services have characterized four specific qualities of public broadcasting.
LISTNUM 1 \l 177 These are:
1) universality of access to every citizen throughout the country;
2) independence from commercial or political influence;
3) diversity in program type, in audiences targeted and in subject matter; and
4) distinctiveness from other broadcasting services.
LISTNUM 1 \l 178 First, universality of access to public broadcasting services is an essential precondition to the provision of a diversity of voices in any broadcasting system.
LISTNUM 1 \l 179 CBC/Radio‑Canada has established near universal access to service in the analog world.
LISTNUM 1 \l 180 Our analog over‑the‑air TV and radio services are available to 99 per cent of Canadians.
LISTNUM 1 \l 181 In the digital world, the challenge is greater as Canadians consume media across a variety of different platforms ‑‑ both regulated and unregulated.
LISTNUM 1 \l 182 We continue to work to secure a place for our services on traditional media platforms by extending over‑the‑air distribution and securing access to satellite and cable distribution.
LISTNUM 1 \l 183 As well, we are broadening our reach onto emerging platforms like the Internet, mobile TV, podcasting and now the potential of Digital Multimedia Broadcasting.
LISTNUM 1 \l 184 We have to reach every citizen in Canada as best we can and we have to do that on every available platform.
LISTNUM 1 \l 185 The second characteristic of public broadcasting is its independence from commercial or political influence.
LISTNUM 1 \l 186 CBC/Radio‑Canada's capacity to provide a distinct and unique perspective in the Canadian broadcasting system is rooted in that independence.
LISTNUM 1 \l 187 In radio we offer a commercial‑free service: no one else is able to provide such a service.
LISTNUM 1 \l 188 In television while we do compete for advertising revenues, we insulate news and current affairs from the pressures of the advertising marketplace.
LISTNUM 1 \l 189 We also enforce the highest standards in respect of journalistic accuracy and accountability across all of our services.
LISTNUM 1 \l 190 Our Parliamentary Appropriation provides the base on which our services are built and it gives us freedom to provide services that are unique in the system and to program in ways that simply is not possible in the private sector.
LISTNUM 1 \l 191 I would like now to turn things over to Richard.
LISTNUM 1 \l 192 MR. STURSBERG: Thank you, Jane.
LISTNUM 1 \l 193 The third characteristic of public broadcasting that Jane mentioned is diversity in programming.
LISTNUM 1 \l 194 CBC/Radio‑Canada provides a diversity of programming both within its network services and in combination with its more niche‑oriented services.
LISTNUM 1 \l 195 For example, within our network services we cover a range of program genres from comedy to drama to sports to variety to performing arts to news and current affairs and documentaries to an extent no other conventional broadcasters do.
LISTNUM 1 \l 196 There is something for everyone on the schedule.
LISTNUM 1 \l 197 Our niche services also play to our strengths as a public broadcaster and enhance our contribution toward our mandate ‑‑ performing arts programming on ARTV, Canadian music on Radio2, news on Newsworld and RDI and documentary programming on The Documentary Channel.
LISTNUM 1 \l 198 With respect to the fourth characteristic of public broadcaster ‑‑ distinctiveness from other broadcasting services ‑‑ CBC/Radio‑Canada's public service obligations are, as they should be, greater than that of other broadcasters and that makes its contribution to a diversity of voices that much more vital.
LISTNUM 1 \l 199 For example, CBC Radio and Radio de Radio‑Canada's prime time schedules are home‑grown and distinctively Canadian.
LISTNUM 1 \l 1100 CBC Television and Television de Radio‑Canada's schedules are similarly distinctive and overwhelmingly Canadian at 80 per cent and 88 per cent in prime time.
LISTNUM 1 \l 1101 To sustain this high level of content, 95 per cent of CBC/Radio‑Canada's programming budget is expended on Canadian programming.
LISTNUM 1 \l 1102 CBC/Radio‑Canada provides a level of distinctiveness that is simply not possible from the rest of the Canadian broadcasting system.
LISTNUM 1 \l 1103 For example, we operate 13 international bureaus around the world; CTV has, I believe, two bureaus outside this country, Global has none, and TVA has one individual in Washington.
LISTNUM 1 \l 1104 Canadians simply would not have an original Canadian perspective on international events without us.
LISTNUM 1 \l 1105 We do more current affairs, more documentary, more international news and more Canadian drama programming than any other player in the system and we do it when Canadians are watching and listening ‑‑ in the heart of prime time.
LISTNUM 1 \l 1106 For economic and commercial reasons, this is just not available from other broadcasters.
LISTNUM 1 \l 1107 Because of simultaneous substitution, CTV and Global simply cannot consistently put Canadian shows in deep prime time. Only we can.
LISTNUM 1 \l 1108 CBC/Radio‑Canada provides a range of Canadian programming, across this country, including in the North in French, English and nine native languages and to Francophone communities outside of Quebec. No one else can do this.
LISTNUM 1 \l 1109 In conclusion, we believe CBC/Radio‑Canada as Canada's national public broadcasters in an essential counterweight to the effects of consolidation and concentration of ownership within the private broadcasting industry.
LISTNUM 1 \l 1110 We also believe therefore that the strength and vitality of public broadcasting should continue to be a key concern of the Commission and CBC/Radio‑Canada should be considered by the CRTC as a key pillar in the Commission's efforts to encourage a diversity of voices in the system.
LISTNUM 1 \l 1111 Thank you. We would be pleased to answer your questions.
LISTNUM 1 \l 1112 THE CHAIRPERSON: Thank you very much.
LISTNUM 1 \l 1113 I would like to go to your submission because what you told us this morning is very interesting.
LISTNUM 1 \l 1114 It basically deals with CBC and its vital role as a Canadian broadcaster, which is not really the key focus of this hearing.
LISTNUM 1 \l 1115 As I told you, the key focus is plurality of voices, diversity of programming and journalistic code.
LISTNUM 1 \l 1116 If I understand your submission correctly, you basically make two suggestions. You suggest that we have a very rich, diverse system and that no drastic overhaul is suggested.
LISTNUM 1 \l 1117 But your first rule is a simple rule on ownership relation over discretionary services and basically you said no person may own or otherwise control more than 33 percent of licence discretionary services.
LISTNUM 1 \l 1118 Can you explain to me what the rationale is for the first rule and on what basis you picked 33 percent?
LISTNUM 1 \l 1119 MR. STURSBERG: We don't maintain that the 33 percent is any sort of magical number. It could be 25 percent, it could be 40 percent. But what we are saying is that if you are going to have diversity then you have to establish some kind of rule that is relatively clear with respect to the maximum number of channels that any party could own.
LISTNUM 1 \l 1120 But as we say, whether this is like 33, whether it is 25, whether it is 40, we don't have a strong view about that but we do think it is essential that there be some minimum floor established.
LISTNUM 1 \l 1121 THE CHAIRPERSON: You are focusing only on 33 percent of licence discretionary services. So I presume that this rule is mainly ‑‑ does it apply to broadcasters as well as BDUs or is that different?
LISTNUM 1 \l 1122 MR. STURSBERG: Actually, we have two different rules that we have proposed and I might just take you to them in our submission.
LISTNUM 1 \l 1123 First of all ‑‑
LISTNUM 1 \l 1124 THE CHAIRPERSON: No, my question was discretionary services can be owned by both BDUs or broadcasters.
LISTNUM 1 \l 1125 MR. STURSBERG: Correct.
LISTNUM 1 \l 1126 THE CHAIRPERSON: So the 33 percent would apply to both of them?
LISTNUM 1 \l 1127 MR. STURSBERG: Yes.
LISTNUM 1 \l 1128 THE CHAIRPERSON: Okay. And then on BDU ownership, you said no person should own or otherwise control more than two BDUs serving a single territory ‑‑
LISTNUM 1 \l 1129 MR. STURSBERG: Mm‑hmm.
LISTNUM 1 \l 1130 THE CHAIRPERSON: ‑‑ that is within the Canadian market and a single BDU should control no more than a certain portion such as again 33 percent.
LISTNUM 1 \l 1131 MR. STURSBERG: That is right.
LISTNUM 1 \l 1132 THE CHAIRPERSON: Maybe you could explain to me the rationale for this rule.
LISTNUM 1 \l 1133 MR. STURSBERG: Well, the rationale for the rule is that we take the view that the BDUs become more and more important in terms of the control of content, that what you want to do is you want to establish a rule that is going to ensure that there is not one, two BDUs who are completely dominant in the marketplace.
LISTNUM 1 \l 1134 The capacity of the BDUs now, it is not just their ability to be able to determine in very large measure which discretionary services win or lose in terms of their ability to establish price or establish position on the dial, it is that the BDUs now are, of course, extending much further into other areas with respect to their control over internet and high‑speed internet particularly, with respect to those of them that are involved in mobile devices of one variety or another.
LISTNUM 1 \l 1135 Then what happens now is that their ability to be able to influence the distribution of content, whether it is sitting on the internet or whether it is sitting on mobile and hand‑held platforms, increases accordingly.
LISTNUM 1 \l 1136 So we think it prudent under the circumstances to establish again some simple rules as to what would constitute reasonable levels of diversity.
LISTNUM 1 \l 1137 M. LAFRANCE : Si je peux ajouter une chose sur le principe, parce qu'on suggère ces deux questions là, puis on dit que le reste dans le fond du système fait un peu la job en matière de protection de la diversité des voix.
LISTNUM 1 \l 1138 Mais sur le principe, il y a une chose importante, c'est qu'on dit, il faut une certaine forme de réglementation pour freiner la concentration, et ça s'inscrit dans un contexte plus global au Canada, comme partout dans le monde, d'ailleurs.
LISTNUM 1 \l 1139 Vous savez, ce qui trouble un peu mon sommeil, ce n'est pas le phénomène de la concentration en soi. Ce qui trouble un peu mon sommeil, ce n'est pas non plus le phénomène de la déréglementation. Ce qui trouble mon sommeil, ce n'est même pas le phénomène de la mondialisation.
LISTNUM 1 \l 1140 J'avoue que ce qui m'empêche parfois de dormir, toutefois, c'est de voir arriver de front la concentration, la déréglementation, et la mondialisation.
LISTNUM 1 \l 1141 Ça, ça pourrait poser une véritable menace à l'identité culturelle canadienne, et, à long terme, il y a vraiment lieu de se poser des questions sérieuses pour s'assurer qu'on n'est pas en train de préparer un terrain pour que, à long terme, il y ait vraiment une érosion de l'identité culturelle canadienne dans cet univers là.
LISTNUM 1 \l 1142 THE CHAIRPERSON: If I understand your two rules correctly, they are really prospective. If, for argument's sake, the Commission would say: CBC, brilliant, we adopt your rules, they wouldn't bite, nobody would be offsite, so to speak. It would, however, ensure that the situation does not become more concentrated than it is now.
LISTNUM 1 \l 1143 I understand that nobody has more than 33 percent of discretionary services, and adopting this rule regarding BDUs, the net effect would be that Shaw could not buy ExpressVu.
LISTNUM 1 \l 1144 MR. STURSBERG: Well, what you say is correct, that they are forward‑looking rules, they are not backward‑looking rules.
LISTNUM 1 \l 1145 With respect to the BDU markets, I think ‑‑ well, first of all, I think, generally speaking, we have to see both the discretionary services markets as falling into two camps. There is a French market and there is an English market and so the one‑third rule should apply to the French market, as it should apply to the English market.
LISTNUM 1 \l 1146 When it comes to BDUs, I think we should think of it as being effectively four markets. There is the major metropolitan markets, the urban markets, and then there is the rural and remote markets. Satellites effectively compete in the rural and remote markets. Their capacity to put competitive pressure on the cable companies in the urban markets is much more limited.
LISTNUM 1 \l 1147 So I would say that when we think about the BDU markets, we should actually think about them as being the French urban, and then rural and remote, and the English urban, and rural and remote.
LISTNUM 1 \l 1148 So to come back to your question, Chairman, the way it would work is that Shaw could not buy ExpressVu because then ExpressVu and Star Choice in the rural and remote markets would breach the rule.
LISTNUM 1 \l 1149 By the same token, Shaw and Rogers could not buy each other because then they would breach the rule in its totality.
LISTNUM 1 \l 1150 THE CHAIRPERSON: They would breach the 33 percent rule?
LISTNUM 1 \l 1151 MR. STURSBERG: Yes. In the English markets.
LISTNUM 1 \l 1152 THE CHAIRPERSON: Yes.
LISTNUM 1 \l 1153 MR. STURSBERG: Yes.
LISTNUM 1 \l 1154 THE CHAIRPERSON: Okay, I understand.
LISTNUM 1 \l 1155 Then lastly, Mr. Lafrance, you mentioned the Australian model and that applying it to Montreal, the situation already is beyond what Australians find an acceptable level.
LISTNUM 1 \l 1156 You are speaking about the French market in Quebec or the English market?
LISTNUM 1 \l 1157 MR. LAFRANCE: We are talking about the French market.
LISTNUM 1 \l 1158 THE CHAIRPERSON: The French market?
LISTNUM 1 \l 1159 MR. LAFRANCE: Yes.
LISTNUM 1 \l 1160 THE CHAIRPERSON: And how did you come to that conclusion? Because the Australian model is sort of intellectually very fascinating but the key is in how you apply it, how you assess the points and what you consider markets.
LISTNUM 1 \l 1161 MR. LAFRANCE: Yes, I think I will ask Bev to ‑‑ she is our specialist of the Australian market.
LISTNUM 1 \l 1162 THE CHAIRPERSON: Okay.
LISTNUM 1 \l 1163 MS KIRSHENBLATT: The reference there was with respect to the CFTPA's filing. They filed an appendix with respect ‑‑ it was filed by Nordicity, and in applying the Australian model, the five‑point model, in looking at various markets, in the French market there was a concern.
LISTNUM 1 \l 1164 THE CHAIRPERSON: Mm‑hmm. The Australian model is very peculiar to Australia because they talk about capital cities and it so happens that the capital cities are also the largest cities in Australia. And then they have a little problem with Tasmania, so they say only as far as continental Australia is concerned because Jojoba doesn't fit the bill.
LISTNUM 1 \l 1165 So how do you translate this to Canada? Wouldn't you have to ‑‑ since we don't have most provincial capitals in the largest cities, we have to adopt that rule and if we wanted to go the Australian way we would have to find some other threshold. And what would be the logical threshold?
LISTNUM 1 \l 1166 MR. STURSBERG: I think that the issue ‑‑ we don't argue that you should necessarily adopt the Australian model but rather that the point of the example is to illustrate the level of concentration in particular markets given some international tests.
LISTNUM 1 \l 1167 The Australian model actually applied to the English market in Montreal, the English market would also fail on the five‑point test.
LISTNUM 1 \l 1168 If you took their other test, the two‑out‑of‑three test, i.e., that you cannot own more than two of radio, television and newspapers, then Toronto would fail because Bell Globemedia owns, obviously, a newspaper, radio stations and television.
LISTNUM 1 \l 1169 In our report we summarize a series of other measures that are used in other different countries in terms of acceptable levels of concentration and I think it would be fair to say that whatever the measure that you use, this country has levels of media concentration that would be in many instances unacceptable in other countries.
LISTNUM 1 \l 1170 THE CHAIRPERSON: It is interesting you mention the two‑out‑of‑three rule that the Australians have superimposed on their point system. I notice in your submission you don't comment on that at all.
LISTNUM 1 \l 1171 What is your view of this?
LISTNUM 1 \l 1172 MR. STURSBERG: I think our view is that generally speaking the level of concentration is already too high and that if the Commission wanted to adopt the two‑out‑of‑three rule, I think that would be prudent.
LISTNUM 1 \l 1173 THE CHAIRPERSON: Okay.
LISTNUM 1 \l 1174 I don't want to dominate the questions, I know my other colleagues have interest in this matter very much.
LISTNUM 1 \l 1175 So I will ask Michel Morin, our newest Commissioner. This is your first hearing, so allez‑y.
LISTNUM 1 \l 1176 CONSEILLER MORIN : Merci, Monsieur le Président.
LISTNUM 1 \l 1177 Monsieur Lafrance, je vous ai entendu plusieurs fois dire, finalement, qu'il y a beaucoup de gens qui sont interviewés chaque semaine à Radio‑Canada, et que, finalement, vous assumez un peu la diversité.
LISTNUM 1 \l 1178 Ma question est la suivante.
LISTNUM 1 \l 1179 Pendant les campagnes électorales, on tient à Radio‑Canada, minutieusement, un registre des interventions des différents participants, de manière à s'assurer que le mot * diversité + ‑‑ que vous et vos collègues avez prononcé ce matin je ne sais pas combien de fois ‑‑ est vraiment réalisé que tout le monde a sa part de l'opinion politique, disons.
LISTNUM 1 \l 1180 Dans les autres sujets, qui sont aussi intéressants, parce qu'il n'y a pas que la politique, le réchauffement de la planète, la privatisation du système de santé, de grands enjeux sociaux, est‑ce que, à Radio‑Canada/CBC, est‑ce que vous tenez, vous faites, ponctuellement, des recherches, des relevés, pour vous assurer vraiment qu'il y a cette diversité?
LISTNUM 1 \l 1181 Je pense au réchauffement de la planète. Il n'y a pas que les Nations‑Unies, mais il y a bien d'autres théories qui acceptent ou qui accepteraient partiellement.
LISTNUM 1 \l 1182 Est‑ce que vous pouvez vous assurer que sur des enjeux majeurs qui ne sont pas politiques, vous pouvez dire, Radio‑Canada, la diversité en ce qui concerne le réchauffement de la planète ou tout autre sujet que vous pouvez choisir, nous l'avons?
LISTNUM 1 \l 1183 M. LAFRANCE : Bien, il existe, d'abord, plusieurs outils pour s'assurer qu'on le fait, et il existe plusieurs outils pour assurer les citoyens qu'ils ont droit aussi de nous poser des questions là‑dessus.
LISTNUM 1 \l 1184 D'une part, on tient compte de l'ensemble des entrevues qui sont faites sur une journée de production, pas seulement aux émissions dites d'information, mais sur l'ensemble d'une grille, que ça soit la radio ou la télé, et je peux vous dire qu'il y a une très grande gamme d'opinions.
LISTNUM 1 \l 1185 Est‑ce que, sur chaque dossier, il y a toujours une assez large gamme d'opinions? C'est une préoccupation qu'on doit toujours avoir. C'est une préoccupation qu'on doit toujours garder, et je dirais que c'est une préoccupation qu'on a de plus en plus, parce qu'il y a plusieurs débats sociaux aujourd'hui qui n'existaient pas il y a 10 ans et sur lesquels il faut s'interroger.
LISTNUM 1 \l 1186 Cela dit, un coup qu'on a appliqué nos politiques journalistiques, un coup qu'on a fait certaines analyses de nos antennes, il existe aussi des moyens pour les citoyens, s'ils se croient lésés ou s'ils croient qu'il y a des opinions qui ne sont pas représentées, ils peuvent aller à l'Ombudsman, ils peuvent aller à différents endroits pour dire, écoutez, je pense que Radio‑Canada ne fait pas sa job là‑dedans.
LISTNUM 1 \l 1187 Moi, je pense qu'on tient généralement compte de l'ensemble des opinions, et je ne vois pas beaucoup de sujets actuellement sur lesquels je ne serais pas tout à fait à l'aise de dire que Radio‑Canada reflète l'ensemble des opinions existantes.
LISTNUM 1 \l 1188 Cela dit, on n'est pas dans une science exacte, hein, ce n'est pas tout à fait simple, et, selon les régions, parfois, nous exprimons des idées qui sont plus exprimées que d'autres. Donc, on n'est pas dans quelque chose de simple, mais je peux vous assurer de la grande responsabilité des journalistes et dirigeants de l'information à Radio‑Canada pour s'assurer qu'il existe une grande diversité d'opinions.
LISTNUM 1 \l 1189 CONSEILLER MORIN : Mais ce matin, par exemple, vous ne pourriez pas, comparativement à la couverture politique, arriver ici avec un bilan, disons, le réchauffement de la planète, voici, on a le spectre entier qui a été respecté?
LISTNUM 1 \l 1190 M. LAFRANCE : Bien écoutez, je peux vous affirmer qu'oui, mais je ne pourrais pas vous déposer un document sur les entrevues qu'on a faites sur le réchauffement de la planète. Je peux vous dire qu'il y en a eu sûrement des centaines dans les trois derniers mois, et qu'il n'y a sans doute pas eu une seule opinion là‑dessus.
LISTNUM 1 \l 1191 Encore une fois, on n'est pas dans une science exacte. Mais c'est une préoccupation qu'on doit toujours avoir.
LISTNUM 1 \l 1192 CONSEILLER MORIN : Dans votre exposé, vous parlez que Radio‑Canada assume cette diversité en tant que diffuseur public, et vous avez bien raison, c'est, je pense, un objectif que tout le monde doit avoir. J'ai un petit problème, c'est vos cotes d'écoute. Quand vous citez l'Allemagne, quand vous citez la Grande‑Bretagne, quand vous citez la France, leur part de marché comme diffuseur public est vraiment très important.
LISTNUM 1 \l 1193 Donc, est‑ce qu'on peut se demander si Radio‑Canada, avec les cotes d'écoute que vous avez, est‑ce que vraiment vous êtes une sécurité dans le système, si vous voulez? Est‑ce que vraiment, avec vos cotes d'écoute, vous pouvez dire : Nous, on assume la diversité que le secteur privé ne peut pas assumer?
LISTNUM 1 \l 1194 M. LAFRANCE : Bien, tout à fait! Elles ne sont pas tout à fait gênantes les cotes d'écoute de Radio‑Canada en télévision, c'est peut‑être 16 pour cent. En radio, c'est assez élevé aussi. Certaines de nos stations sont premières dans leur marché. Donc, c'est important.
LISTNUM 1 \l 1195 Je vous dirais sur cette question‑là que, quand on compare avec l'Europe, il faut faire attention, il y a plusieurs grosses différences.
LISTNUM 1 \l 1196 La part du service public en Angleterre est plus grande, mais le service public a beaucoup plus de chaînes. Je crois que Radio France a sept chaînes publiques de radio en France. Nous n'en avons que deux. Alors, quand on additionne les sept, ça donne une part de marché beaucoup plus grande.
LISTNUM 1 \l 1197 Les moyens consacrés per capita aux services de radio‑télévision publique dans la plupart des pays européens sont énormément plus élevés qu'au Canada.
LISTNUM 1 \l 1198 L'historique des services publics en Europe, l'histoire est beaucoup plus longue. Il existait en France... jusqu'en 1980, il existait à peu près que des services publics.
LISTNUM 1 \l 1199 Donc, toutes ces choses‑là font que c'est différent.
LISTNUM 1 \l 1200 Mais moi, je peux vous dire que la radio de Radio‑Canada est écoutée chaque semaine par environ un million de citoyens. Ça peut faire une assez grosse différence dans la diversité des voix.
LISTNUM 1 \l 1201 Quand une émission comme * Tout le monde en parle + attire jusqu'à un million et demi de personnes qui suivent des débats à la télévision, ça fait, fatalement, une différence.
LISTNUM 1 \l 1202 Quand on additionne l'ensemble des gens qui, à l'intérieur d'une journée, vont chercher un bulletin de nouvelles à Radio‑Canada, à la radio, à la télé, sur l'internet, sur RDI ou ailleurs, ça fait pas mal de monde, et je pense vraiment que ça peut faire une différence énorme.
LISTNUM 1 \l 1203 MR. STURSBERG: May I just add something to what Sylvain said because I think the question is a very good question.
LISTNUM 1 \l 1204 The strength of the counterweight that the public broadcaster can provide is obviously a function of its presence in the market and what Sylvain says is, of course, quite right, that in many European markets, particularly in Britain and in France, the public broadcaster has many other channels and, indeed, that the level of public financing for the public broadcaster is substantially greater.
LISTNUM 1 \l 1205 One of the things we put in our presentation ‑‑ it is in our presentation?
LISTNUM 1 \l 1206 MS KIRSHENBLATT: No.
LISTNUM 1 \l 1207 MR. STURSBERG: No. All right, it doesn't matter. I brought it along in any event.
LISTNUM 1 \l 1208 We can give you copies of it but we filed this with the Commission before, which is the Nordicity Report on government support for public broadcasting, which says that per capita public funding for public broadcasters across a whole range of European countries, Switzerland, Norway, Germany, U.K., Denmark, Sweden, Finland, Austria, France, Belgium, et cetera, is about $80 Canadian per person. In Canada, it is about $33.
LISTNUM 1 \l 1209 But it illustrates, I think, and this is the really fundamental point, that if we want to be able to have a good counterweight to the increased consolidation of the system, then it is very important that the public broadcaster be strong whether that has to do with its financing or that it be strong whether it has to do with the number of channels that it disposes of.
LISTNUM 1 \l 1210 M. LAFRANCE : Peut‑être ajouter aussi, Monsieur Morin, en radio que la radio de Radio‑Canada ‑‑ écoutez, je m'excuse, je n'ai pas les chiffres toujours en tête ‑‑ je pense, est environ 15 pour cent de part de marché.
LISTNUM 1 \l 1211 Si on enlève les stations qui ne sont que musicales et qu'on regarde dans le marché de l'information radiophonique, Radio‑Canada sur Montréal occupe probablement, et je le dis là à peu près de mémoire, 35 ou 40 pour cent du marché des radios d'info. Alors, ça fait naturellement une assez forte différence en matière de diversité des voix.
LISTNUM 1 \l 1212 CONSEILLER MORIN : L'indépendance des salles de nouvelles, on va sûrement en parler au cours des prochains jours, notamment, avec les entreprises du secteur privé.
LISTNUM 1 \l 1213 L'an passé, vous avez fait un exposé à l'Association professionnelle des journalistes à Québec, je pense c'était en novembre 2006, et vous aviez acheté, peut‑être pas le mot, mais au moins l'esprit de la convergence.
LISTNUM 1 \l 1214 Ma question est la suivante.
LISTNUM 1 \l 1215 Dans la mesure où vous avez une salle de nouvelles radio, une salle de nouvelles télé, le secteur affaires publiques, et qu'une information d'une émission d'affaires publiques est diffusée à la radio, et puis ensuite à la télé, vous ressemblez beaucoup à l'entreprise privée, d'une certaine manière.
LISTNUM 1 \l 1216 Ma question : Est‑ce que vous avez mis en place des mécanismes pour vous assurer qu'au point de vue journalistique, on ne fait pas que reprendre ce qui est diffusé sur une plate‑forme, mais qu'il y a vraiment une vérification d'un certain nombre d'informations à partir du moment où cette nouvelle est issue, par exemple, du secteur public ou inversement?
LISTNUM 1 \l 1217 M. LAFRANCE : J'avais mentionné à Québec que l'intégration à Radio‑Canada, ce n'est pas vraiment une question de convergence, c'est une question de gros bon sens.
LISTNUM 1 \l 1218 Ça se fait déjà à l'intérieur d'une seule organisation où il y avait déjà un seul patron, un seul conseil d'administration, et donc, sur ce plan‑là, on n'a pas changé la nature même de l'organisation. Ce qu'on a fait, c'est qu'on a dit, puisqu'on est une même marque et une même entreprise, on va travailler un peu plus ensemble pour l'efficacité du système.
LISTNUM 1 \l 1219 Ça n'a, d'ailleurs, jamais visé des objectifs d'économie de coûts. Ça fait qu'on n'a pas, par ça, réduit le nombre de journalistes.
LISTNUM 1 \l 1220 Ce qu'on a fait, c'est que là où c'est très coûteux, par exemple, dans le journalisme quand on va à l'étranger, quand on va dans des régions éloignées et tout ça, on s'assure que, effectivement, l'information puisse servir l'ensemble de nos plates‑formes.
LISTNUM 1 \l 1221 Pour moi, l'obsession, de toute façon, de cette intégration‑là n'est ni une obsession économique, ni une obsession technologique, et sur ce plan‑là, ne menace pas les salles de nouvelles. C'est une obsession de marque.
LISTNUM 1 \l 1222 Moi, je veux que, quelle que soit la plate‑forme sur laquelle les Canadiens écoutent leur information, que ça soit de la radio, de la télé, de l'internet, de la téléphonie cellulaire ou autre plate‑forme qui puisse exister, on reconnaisse toujours les valeurs et la qualité du service public. Pour moi, c'est ça qui est fondamental.
LISTNUM 1 \l 1223 Alors, ça n'a pas changé les lignes de décision éditoriales. Il y a toujours des chefs de pupitre radio, des chefs de pupitre télé ou des chefs de pupitre web qui décident de ce qu'ils vont diffuser. Ça n'a pas changé la ligne éditoriale.
LISTNUM 1 \l 1224 Mais ce que je veux, c'est que, vraiment, les valeurs du service public et la qualité du service public transcendent les plates‑formes et qu'on les retrouve partout pour que le Canadien comprenne bien ce que ça représente pour lui.
LISTNUM 1 \l 1225 Je pense qu'il y a une certaine efficacité dans les couvertures très coûteuses, comme l'Afghanistan ou des choses comme ça, de demander à des journalistes qui sont, de toute façon, sur place d'intervenir sur différentes plates‑formes.
LISTNUM 1 \l 1226 CONSEILLER MORIN : Dernière question.
LISTNUM 1 \l 1227 Évidemment, quand on parle de diversité, on parle de différentes sources, et ces sources sont d'autant meilleures en matière de journalisme que les journalistes ont un beat, un secteur d'activité, parce que c'est généralement un spécialiste de l'économie, de l'environnement, de la santé, qui va générer beaucoup de nouvelles et, donc, beaucoup de diversité.
LISTNUM 1 \l 1228 J'aimerais savoir si CBC/Radio‑Canada a une politique pour développer... compte tenu que vous êtes un diffuseur public, compte tenu que vous êtes largement subventionné par l'État, est‑ce que vous avez une politique pour développer des beats, pour développer des journalistes dans des secteurs spécialisés qui, dans leur univers médiatique, vont faire autorité?
LISTNUM 1 \l 1229 M. LAFRANCE : Non seulement la réponse est oui, mais on est de loin ceux qui en ont le plus, parce que je vais donner l'exemple des émissions d'affaires publiques. Nous sommes sans doute les seuls à présenter de façon hebdomadaire deux émissions sur la science.
LISTNUM 1 \l 1230 On va lancer jeudi le 26 septembre (sic) une grande émission sur l'information internationale. Ça sera un beat où il y a aura beaucoup de journalistes spécialisés.
LISTNUM 1 \l 1231 On a une émission sur les ressources de la terre, l'agriculture, qui est spécialisée, qui est sur trois plates‑formes.
LISTNUM 1 \l 1232 Donc, si on prend simplement l'exemple des affaires publiques, ça constitue des beats spécialisés en matière d'information, où on a là des ressources extrêmement compétentes pour faire le travail.
LISTNUM 1 \l 1233 A l'intérieur des salles de nouvelles, il y a aussi des journalistes spécialisés, naturellement, pour suivre différents beats. Ça se retrouve, comme il y a des généralistes.
LISTNUM 1 \l 1234 Est‑ce que l'équilibre va changer ou pas? Je ne le sais pas, mais je peux vous dire que quand on regarde la dizaine d'heures d'affaires publiques qu'on fait en télévision, quand on regarde, de mémoire, une trentaine d'heures d'affaires publiques qu'on fait en radio, ça fait beaucoup, beaucoup, beaucoup de beats spécialisés.
LISTNUM 1 \l 1235 CONSEILLER MORIN : Mais j'aurais dû préciser, au service des nouvelles.
LISTNUM 1 \l 1236 M. LAFRANCE : Au service des nouvelles, il y a des beats spécialisés. Est‑ce qu'il y en aura plus, est‑ce qu'il y en aura moins, je ne le sais pas.
LISTNUM 1 \l 1237 Je vous dirais là‑dessus que la question de l'intégration n'y change rien. C'est‑à‑dire que, pour nous, les journalistes spécialisés sont là, ils doivent travailler, et la question de l'intégration ne change pas, encore là.
LISTNUM 1 \l 1238 Il n'y a pas d'économie de ressources dans notre stratégie d'intégration. On ne veut pas diminuer le nombre de journalistes. On veut, au contraire, s'assurer que le citoyen qui paie pour les services de Radio‑Canada peut trouver son information là où il la veut.
LISTNUM 1 \l 1239 Écoutez, je n'ai pas une indication ‑‑ puis, je serais content de l'entendre ‑‑ qu'il y a eu, par cette politique‑là, depuis deux ans la moindre diminution de la qualité de notre information ou la moindre diminution de la quantité de beats spécialisés qu'on a à la salle des nouvelles. Je ne le crois pas.
LISTNUM 1 \l 1240 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 1241 Rita, I believe you had a question.
LISTNUM 1 \l 1242 COMMISSIONER CUGINI: Yes, thank you.
LISTNUM 1 \l 1243 Good morning. I just want to go back for a second on your suggestion on limiting the ownership of discretionary services. Let us just use 33 percent for the sake of argument.
LISTNUM 1 \l 1244 I understand that existing services are to be grandfathered, to be applied in the future.
LISTNUM 1 \l 1245 Does this mean, therefore, that any further consolidation we would have to look at the 33 percent as the benchmark?
LISTNUM 1 \l 1246 MR. STURSBERG: Yes.
LISTNUM 1 \l 1247 COMMISSIONER CUGINI: And that would apply too to companies who would want to apply for new services?
LISTNUM 1 \l 1248 MR. STURSBERG: Yes.
LISTNUM 1 \l 1249 COMMISSIONER CUGINI: In paragraph 84 of your submission, you say:
"Among other things, the opportunities for independent producers, each with a diverse voice could be limited." (As read)
LISTNUM 1 \l 1250 Are you suggesting that the safeguards that we currently have for specialty services, where specialty services have COLs that say a certain percentage of their programming must come from independent producers, that that is not sufficient to ensure diversity from independent producers?
LISTNUM 1 \l 1251 MR. STURSBERG: Yes, and the reason for that is that when it comes to ‑‑ there are two things that are of concern to me.
LISTNUM 1 \l 1252 One is that when it comes to negotiating with independent producers, your capacity to make deals and the position that you can put yourself in within a deal can vary widely.
LISTNUM 1 \l 1253 COMMISSIONER CUGINI: Mm‑hmm.
LISTNUM 1 \l 1254 MR. STURSBERG: The more powerful you are in your negotiations, the better a deal you can make for yourself.
LISTNUM 1 \l 1255 The second thing is that if you are very powerful, then your capacity to be able to tie up talent, i.e., tie up the most gifted independent producers against others, increases.
LISTNUM 1 \l 1256 So for both reasons, I think that it would be unwise to allow people ‑‑ and these are things that you cannot get at with conditions of licence, if you follow me. You can't get there.
LISTNUM 1 \l 1257 So for both of these reasons, I think when it comes to the independent production community, the wiser thing is not to allow any of the services to become so powerful that they can dictate terms that advantage them significantly more than any other broadcaster and/or tie up the talent in a way where it is denied to others.
LISTNUM 1 \l 1258 COMMISSIONER CUGINI: And because you started that sentence with "among other things," I am going to ask you what are the other things that you feel would constrain diversity if we weren't to set a limit on the ownership of discretionary services?
LISTNUM 1 \l 1259 MR. STURSBERG: Well, I think we are going to get into this a little bit more in the next round of hearings but there's a lot of issues around this, some of which have to do with the diversity of editorial voice that we have been talking about, some of which have to do with economic power and with market power.
LISTNUM 1 \l 1260 When I am talking about the independent producers and the relationship of the services to the producers, I am really talking about the extent of their market power. Market power will reflect itself not just in the relationship to producers, it will reflect itself in your capacity to be able to make deals with BDUs.
LISTNUM 1 \l 1261 So if you are very, very powerful, then your capacity to be able to strike those deals ‑‑ in other words, if you own a vast array of services that they absolutely must have, your capacity to be able to extract rents from the BDUs that will be higher than normal will be increased.
LISTNUM 1 \l 1262 But, of course, then what happens to the other services, because the BDUs have to maintain their margins, is that creates pressure on them then to lower what it is that they pay by way of fees to the other services who are not part of the larger group.
LISTNUM 1 \l 1263 The other way you would see it, of course, is in terms of advertising revenue ‑‑ and we have talked about some of these things in other hearings ‑‑ but to the extent that people are dominant in the advertising market, then what economic dominance means is, of course, your ability ‑‑ precisely what it means is your ability to be able to price higher than would happen in a normally competitive market.
LISTNUM 1 \l 1264 So again, you will see those kinds of effects.
LISTNUM 1 \l 1265 So to avoid those kinds of effects, whether it is economic dominance vis‑à‑vis the production community, economic dominance with respect to advertising revenue or economic dominance vis‑à‑vis negotiations with BDUs, we think it prudent to be able to maintain some kind of limit on size.
LISTNUM 1 \l 1266 COMMISSIONER CUGINI: And while the vast majority of specialty services are national in scope, there are a handful of regional services.
LISTNUM 1 \l 1267 Would you apply the rule to both?
LISTNUM 1 \l 1268 MR. STURSBERG: We think issues of ‑‑ yes. I don't think it is going to be much of a problem, frankly, at the local level but we think, obviously, diversity issues are important at the local level, as they are at the national level.
LISTNUM 1 \l 1269 Obviously, we think that diversity with respect to local views and issues, whether those are news issues or whether they are lifestyle issues or whatever they happen to be, it is very important there as well.
LISTNUM 1 \l 1270 COMMISSIONER CUGINI: Thank you.
LISTNUM 1 \l 1271 Thank you, Mr. Chairman, those are my questions.
LISTNUM 1 \l 1272 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 1273 Stuart, you had a question?
LISTNUM 1 \l 1274 COMMISSIONER LANGFORD: Yes. Thank you, Mr. Chairman.
LISTNUM 1 \l 1275 I want to come back to what I take to be the kind of main thrust of your argument, and by that I do not mean your comments on BDUs or limits on diversity ownership, because if I have got it right the main thrust of your argument is don't worry about what the private sector does within the sort of limits, we will take care of diversity, a strong CBC will do the job.
LISTNUM 1 \l 1276 Essentially, is that it?
LISTNUM 1 \l 1277 MR. STURSBERG: I would say that ‑‑ let me put it slightly differently but in a similar vein.
LISTNUM 1 \l 1278 Subject to some reasonable limits with respect to concentration on the private side, what we are saying is that the public broadcaster can be an important counterweight to further consolidation in the private sector.
LISTNUM 1 \l 1279 We take this view ‑‑ you know, it is not just our view. As we cited in our stuff, the Council of Europe, UNESCO and various others believe exactly the same thing, that if you want to have a healthy policy with respect to concentration of media, it is very important that you have a strong public broadcaster.
LISTNUM 1 \l 1280 Now, having said all that, I wouldn't say that we would say, "Leave it to us," partly for the reasons that Sylvain mentioned earlier and partly because ‑‑ and I sort of expanded on it a bit in English ‑‑ when you look at those public broadcasters in other countries that are really powerful counterweights to private sector consolidation, whether in France or in Britain, those are public broadcasters that are better financed and have more channels at their disposal.
LISTNUM 1 \l 1281 So, if you want to use the public broadcaster ‑‑ and we think you should, and we think that is consistent with practice in other countries ‑‑ as an important counterweight, then all we are saying is, be sure that you try, to the extent that it is within the Commission's power to do so, to make sure the public broadcaster is strong.
LISTNUM 1 \l 1282 COMMISSIONER LANGFORD: You have foreseen my second question, because, with respect, we can't do it. That's the problem, isn't it?
LISTNUM 1 \l 1283 On the one hand you are saying: Try to leave it to us. Do what you can to leave it to us. That's the solution.
LISTNUM 1 \l 1284 On the other hand you are saying: In Europe it is $80 per person, approximately, that goes to the public broadcaster. Here we are being starved at $33.
LISTNUM 1 \l 1285 If that is the case, if you need seven channels, like France, and you don't have them, and if you need $80 per capita and you don't have it, and we are not a taxing authority, how precisely do you expect us to take the risk of following your main point, when there is practically no way we can guarantee that type of environment?
LISTNUM 1 \l 1286 MR. STURSBERG: Commissioner, maybe I can come back to your findings in the Television Policy hearings.
LISTNUM 1 \l 1287 As I understood what the Commission's finding was, it said: We do have the power to establish subscriber fees for conventional broadcasters, if we want to.
LISTNUM 1 \l 1288 If we want to.
LISTNUM 1 \l 1289 Then, you kind of left it at that. You had some further views as to whether the advertising markets for conventional broadcasters were sufficiently eroded, et cetera, et cetera.
LISTNUM 1 \l 1290 Our position had been, quite apart from the erosion of the advertising markets, that one of the things we may want to come and talk to you about in the future is whether it would be prudent to put in place such a fee that would be applicable to the satellite and cable companies to finance other kinds of activities, and we set out a number of the kinds of things there might have been: more Canadian content, high‑definition television, et cetera.
LISTNUM 1 \l 1291 So, there, I think you have found yourselves that you have the power to be able to do that in the first instance.
LISTNUM 1 \l 1292 In the second instance, I would just say that, frankly, I think it is too bad that the CBC finds itself now, after the great round of licensing of specialty channels in the past, in a situation where it has so few specialty channels.
LISTNUM 1 \l 1293 There is nothing much that can be done about that. We are where we are. But I would say that, to the extent that we can acquire or grow specialty channels of one variety or another, the Commission could be helpful there.
LISTNUM 1 \l 1294 We were very pleased, obviously, when you agreed to the transfer of the Documentary Channel from Corus to us. It is a small thing, but it was helpful.
LISTNUM 1 \l 1295 M. LAFRANCE : Si je peux aussi ajouter, je n'adhère pas au résumé un peu bold que vous faites du rapport en disant Radio‑Canada est une réponse, donc, on peut déréglementer joyeusement et tout ça. Je ne pense pas que c'est ce qu'on dit du tout.
LISTNUM 1 \l 1296 Ce qu'on dit ici... et, d'ailleurs, je ne crois pas du tout que le libre‑marché pourrait régler en lui‑même les questions de la concentration. Si le libre‑marché était une réponse aux grands enjeux de culture et de démocratie dans le monde, ça se saurait.
LISTNUM 1 \l 1297 Alors, il y a, donc, d'autres outils qui sont nécessaires, et on le dit dans le rapport. On dit, la réglementation actuelle, par exemple, est très utile. On suggère même d'ajouter d'autres réglementations.
LISTNUM 1 \l 1298 Donc, on ne dit pas que le diffuseur public est en lui‑même la seule réponse et qu'en dehors de ça, on peut, donc, tout faire.
LISTNUM 1 \l 1299 Ce qu'on dit, c'est que c'est quand même une réponse importante puisque ses forces sont précisément dans le domaine de l'information, dans le domaine de la création dramatique, dans le domaine de la création variétés. Donc, effectivement, il y a là une force qui est importante et qu'il ne faut pas abandonner.
LISTNUM 1 \l 1300 Ça, on le dit. On précise très bien partout qu'il y a un certain nombre de réglementations non seulement utiles, mais fondamentales, pour qu'il y existe des formes de diversité.
LISTNUM 1 \l 1301 Donc, je n'adhère pas du tout au résumé que vous avez fait un peu du rapport.
LISTNUM 1 \l 1302 COMMISSIONER LANGFORD: Well, I would say this. I take your point, Mr. Stursberg ‑‑ and I did hear your eloquence, sir ‑‑ that we could, for example, give you fee‑for‑carriage. We could tax every cable and ExpressVu satellite viewer or DTH viewer in Canada. We could add a tax to it and give you a fee, and increase, but what would you give us in return?
LISTNUM 1 \l 1303 I think that would be a fair question.
LISTNUM 1 \l 1304 For example, I would say that, if we are looking for diversity of voices, when I look at the amount of money ‑‑ and we don't know your budget right down to the dollar, but some things are publicly stated ‑‑ when I look at the amount of money that goes to hockey, for example, even though people like hockey, it doesn't add that much diversity. They can get it on TSN, as well, and it's a huge amount of your budget.
LISTNUM 1 \l 1305 When I look at the guarantees that we thought we had for local news at the last licence renewal ‑‑ and then there was a process a number of years ago where CBC began to gut local news. That has been reversed somewhat now, but one would think that wouldn't happen if you were going to come to us and say: Get us more money. Make Canadians pay more for our service, and we will handle diversity for you.
LISTNUM 1 \l 1306 What is the quid pro quo? What do you do for us?
LISTNUM 1 \l 1307 By the way, this isn't an attempt to beat up on the CBC; this is an attempt for us to say, "If we are going to buy into this guarantee, there has to be a guarantee," and I don't see the other side of it.
LISTNUM 1 \l 1308 MR. STURSBERG: I don't mind beating up on the CBC. I do it a certain amount myself.
LISTNUM 1 \l 1309 COMMISSIONER LANGFORD: That's because you are paid to do it.
LISTNUM 1 \l 1310 MR. STURSBERG: Can I come back through it very quickly?
LISTNUM 1 \l 1311 THE CHAIRPERSON: Just make sure we come back to diversity of voices. This is not a CBC renewal hearing.
LISTNUM 1 \l 1312 I heard the question, but keep it focused on diversity of voices.
LISTNUM 1 \l 1313 MR. STURSBERG: I understand, but I have to respond to one little thing, which is: Hockey makes money for the CBC.
LISTNUM 1 \l 1314 One of the reasons why we like hockey is precisely that it contributes margin that allows us to finance the things that would otherwise lose money, whether that's news or whether that's Canadian dramatic programming.
LISTNUM 1 \l 1315 To your more general question, I think it is perfectly fair that you say: What would we do for a sub‑fee?
LISTNUM 1 \l 1316 We have not actually made an application on that yet, but we agree with you that, were we to do so, the fee would be tied to concrete deliverables.
LISTNUM 1 \l 1317 COMMISSIONER LANGFORD: Only the fee.
LISTNUM 1 \l 1318 So what you are saying is: Add more, and we will do more. But if we don't do a fee, and if we can't, for some reason, persuade the government to give you more, then your offer to guarantee diversity, and to allow the market forces to take off on the other side, shouldn't give us that much comfort, should it?
LISTNUM 1 \l 1319 MR. STURSBERG: I agree with you on that. I completely agree with you on that. I think that was the point we were making earlier when we said: The extent to which the public broadcaster can be a useful counterweight for your purposes in terms of diversity is a function of the strength and vitality of the public broadcaster.
LISTNUM 1 \l 1320 I completely agree with you about that.
LISTNUM 1 \l 1321 COMMISSIONER LANGFORD: We will have to be looking for some other answers then.
LISTNUM 1 \l 1322 Those are my questions, Mr. Chairman.
LISTNUM 1 \l 1323 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 1324 Andrée.
LISTNUM 1 \l 1325 COMMISSIONER NOEL: Mr. Stursberg, you mentioned that CBC/SRC is a counterweight ‑‑ and I heard you mention it again a few seconds ago ‑‑ a counterweight to the concentration of media in Canada, and you mentioned this morning, at page 8 of your oral presentation ‑‑ and I will quote you:
"We do more current affairs, more documentary, more international news and more Canadian drama programming than any other player in the system, and we do it when Canadians are watching and listening, in the heart of prime time. For economic and commercial reasons, this is just not available from other broadcasters. Because of simultaneous substitution, CTV and Global simply cannot consistently put Canadian shows in deep prime time, only weekend." (As read)
LISTNUM 1 \l 1326 When you mentioned that, were you referring to the English CBC, or were you referring to both sides of the equation?
LISTNUM 1 \l 1327 MR. STURSBERG: With respect to simultaneous substitution, obviously the English side. But with respect to other matters, including documentaries, current affairs, et cetera, in deep prime time that would be true of French, as well.
LISTNUM 1 \l 1328 COMMISSIONER NOEL: Could you tell us if all of these investments in developing content ‑‑ Canadian drama, for example ‑‑ pays in terms of viewership in prime time?
LISTNUM 1 \l 1329 I know the answer for the French side; I am looking for the answer on the English side.
LISTNUM 1 \l 1330 MR. STURSBERG: Yes. Over the course of the last little while we have put a particular emphasis on trying to redo our drama and entertainment strategy to focus on building audiences for Canadian shows.
LISTNUM 1 \l 1331 Our view is the fundamental cultural challenge in English Canada is to make popular Canadian television shows, whether it is drama or comedy. We have not done this very well over the course of many, many years. I can think, maybe, of three or four shows in the last 15 or 20 years that have managed to get more than a million viewers on a consistent basis ‑‑ Due South.
LISTNUM 1 \l 1332 And I would say to the people at CTV that they have done a very good job with Corner Gas.
LISTNUM 1 \l 1333 Most recently it was Little Mosque on the Prairie, which is our show.
LISTNUM 1 \l 1334 We think it is very, very important to put particular emphasis on actually building audiences for Canadian shows on television, so we have changed a lot of our strategy. We have changed how we go at things, how we develop them, whether we want a series versus a mini‑series or MOWs, and we are starting to have some success.
LISTNUM 1 \l 1335 I hope very much that we will have more success with this coming season, and more success with the season after, because I think that would be good.
LISTNUM 1 \l 1336 But, as I come back to it again, we are the only broadcaster, which is not hobbled by simultaneous substitution in English, that can put Canadian shows consistently on in deep prime time, when Canadians are actually viewing. So those shows will have a chance of actually getting some successful audiences.
LISTNUM 1 \l 1337 COMMISSIONER NOEL: Merci, Monsieur Stursberg.
LISTNUM 1 \l 1338 Monsieur Lafrance, voudriez‑vous commenter pour le réseau français?
LISTNUM 1 \l 1339 M. LAFRANCE : Bien, naturellement, la situation est très différente, comme vous le savez. Les émissions canadiennes ont beaucoup de succès. Les francophones du pays sont très attachés à leur télévision, que ça soit Radio‑Canada, TVO ou TQS, d'ailleurs, ou les autres chaînes.
LISTNUM 1 \l 1340 Alors, la situation se présente énormément différemment en matière de dramatiques, quoique c'est vrai qu'en matière d'affaires publiques, Radio‑Canada joue un rôle assez unique, avec 10 heures d'affaires publiques par semaine.
LISTNUM 1 \l 1341 En matière de créations dramatiques, on a lancé, l'an dernier, je pense, 11 nouvelles créations dramatiques. C'est cinq fois plus, je pense, que notre plus proche concurrent. Donc, en matière de créations dramatiques, on est de loin devant tout le monde.
LISTNUM 1 \l 1342 Et je dirais qu'en matière de création de diversité, si on pense aux émissions spécialisées scientifiques, religieuses ou autres, à l'antenne de Radio‑Canada, c'est une télévision de diversité.
LISTNUM 1 \l 1343 Pour la radio, je pense que je n'ai même pas besoin de le mentionner parce que c'est évident qu'en arrivant à l'antenne de la radio de Radio‑Canada, on reconnaît tout de suite le service public.
LISTNUM 1 \l 1344 CONSEILLERE NOEL : Merci beaucoup.
LISTNUM 1 \l 1345 THE CHAIRPERSON: Michel, you have a correction to make?
LISTNUM 1 \l 1346 COMMISSIONER ARPIN: I heard Mrs. Kirschenblatt stating data based on the Nordicity study, trying to show that the Montreal French market is already below the threshold that has been established for Australia.
LISTNUM 1 \l 1347 I think if we were to make the real count, based on the Australian system, the diversity index would be 10 rather than 4, because Nordicity forgot to put Gesca, "La Presse," "Le Devoir," three other radio groups, Radio Nord, le Groupe Azulé, la station de monsieur Coallier. Puis on pourrait même ajouter * Métro + de Transcontinental. Donc, on passerait même de 10 à 11.
LISTNUM 1 \l 1348 Donc, je fais le commentaire juste au cas où d'autres voudraient aussi se servir de l'étude de Nordicity pour essayer de montrer que, dans le marché francophone de Montréal, il y a une lacune de diversité, basé sur le modèle australien.
LISTNUM 1 \l 1349 Il pourrait y en avoir, mais basé sur un autre modèle. Basé sur ce modèle‑là, je pense qu'il y a eu des oublis majeurs dans le décompte fait par Nordicity.
LISTNUM 1 \l 1350 Donc, c'était ma contribution à votre comparution.
LISTNUM 1 \l 1351 THE CHAIRPERSON: In speaking of that, Mr. Stursberg, when you threw out 33 percent for discretionary service, you said that would be if it doesn't bite anybody, if it doesn't affect anybody. Is that the same for the English and the French markets?
LISTNUM 1 \l 1352 I am getting a message here that, actually, in the French market, somebody may already be over 33 percent.
LISTNUM 1 \l 1353 Would you suggest the same 33 percent for both language markets, or do you think it would be appropriate to have a different one for the French market, as we can under the Act?
LISTNUM 1 \l 1354 MR. STURSBERG: It is also a forward‑looking measure, right?
LISTNUM 1 \l 1355 We are not suggesting that anybody, even if they were to breach the 33 percent rule, needs to be rolled back. We are just saying that, as a going‑forward matter, you should ‑‑
LISTNUM 1 \l 1356 THE CHAIRPERSON: And for the existing years.
LISTNUM 1 \l 1357 MR. STURSBERG: Yes.
LISTNUM 1 \l 1358 THE CHAIRPERSON: Okay. Those are our questions. Thank you very much for a very interesting presentation.
LISTNUM 1 \l 1359 Madame Boulet, who is next?
LISTNUM 1 \l 1360 THE SECRETARY: Thank you, Mr. Chairman.
LISTNUM 1 \l 1361 I will now invite the Canadian Association of Broadcasters to come forward for their presentation.
‑‑‑ Pause
LISTNUM 1 \l 1362 THE CHAIRPERSON: Mr. O'Farrell, have you brought your entire association?
‑‑‑ Laughter / Rires
LISTNUM 1 \l 1363 MR. O'FARRELL: We are still a little more numerous than that, sir.
LISTNUM 1 \l 1364 THE CHAIRPERSON: Madame Boulet, over to you.
LISTNUM 1 \l 1365 THE SECRETARY: Thank you, Mr. Chairman.
LISTNUM 1 \l 1366 The Canadian Association of Broadcasters will be introduced by Ms Charlotte Bell.
LISTNUM 1 \l 1367 If you could please introduce your panel, and then you will have 10 minutes for your presentation.
LISTNUM 1 \l 1368 Ms Bell.
INTERVENTION
LISTNUM 1 \l 1369 MS BELL: Thank you.
LISTNUM 1 \l 1370 Bonjour, Monsieur le Président et membres du Conseil. Je m'appelle Charlotte Bell, et je suis présidente du conseil d'administration de l'Association canadienne des radiodiffuseurs et vice‑présidente Affaires réglementaires pour CanWest MediaWorks.
LISTNUM 1 \l 1371 J'ai le plaisir de m'adresser à vous, aujourd'hui, au nom de l'ACR, au sujet de la diversité dans l'environnement canadien des médias.
LISTNUM 1 \l 1372 Permettez‑moi, d'abord, de vous présenter les personnes qui m'accompagnent.
LISTNUM 1 \l 1373 Commençant à l'extrême droite :
LISTNUM 1 \l 1374 David Goldstein, vice‑président Affaires réglementaires, CTVglobemedia;
LISTNUM 1 \l 1375 Sophie Émond, vice‑présidente Affaires réglementaires et gouvernementales, Astral Média;
LISTNUM 1 \l 1376 Lyndon Friesen, vice‑président exécutif et chef des opérations, Golden West Broadcasting; et
LISTNUM 1 \l 1377 Glenn O'Farrell, président et chef de la direction de l'Association canadienne des radiodiffuseurs.
LISTNUM 1 \l 1378 A ma gauche :
LISTNUM 1 \l 1379 Pierre Lampron, vice‑président Relations institutionnelles, Quebecor Média;
LISTNUM 1 \l 1380 Gary Maavara, vice‑président et avocat général, Corus Entertainment;
LISTNUM 1 \l 1381 Debra McLaughlin, Consultant, Strategic Inc.;
LISTNUM 1 \l 1382 Pierre‑Louis Smith, vice‑président Politique et agent en chef de la réglementation, Association canadienne des radiodiffuseurs.
LISTNUM 1 \l 1383 Monsieur le Président, mesdames et messieurs les conseillers, j'aimerais demander à Glenn O'Farrell d'entamer notre présentation.
LISTNUM 1 \l 1384 MR. O'FARRELL: Thank you very much.
LISTNUM 1 \l 1385 Mr. Chair and Commissioners, I will focus on three issues that you have identified as priorities: first, the diversity of commercial editorial voices in Canadian markets and the most effective means of preserving that diversity.
LISTNUM 1 \l 1386 You will hear me say that a strong and vibrant journalistic culture anchors editorial diversity in Canadian media.
LISTNUM 1 \l 1387 Secondly, the diversity of programming choices on offer, and whether additional regulatory tools are necessary to preserve it.
LISTNUM 1 \l 1388 On this you will hear me argue that policy measures in place have fostered an abundance of diversity in programming choices across diverse formats and demographic segments, and that the best way of preserving this and sustaining this is to provide regulatory support to players who risk their capital to provide Canadian media choices in an increasingly competitive marketplace, including a new unregulated market.
LISTNUM 1 \l 1389 You will hear me say that the current system is working very well and no new rules are necessary.
LISTNUM 1 \l 1390 Furthermore, it would be a huge mistake to borrow on proven regulatory models developed elsewhere, for different policy reasons, than those that exist in Canada.
LISTNUM 1 \l 1391 Finally, our views on the effectiveness of the proposed Canadian Broadcast Standards Council's code as a means of sustaining editorial independence in cross‑media ownership situations.
LISTNUM 1 \l 1392 On this issue you will hear our views that this code has a proven track record, and has effective outcomes.
LISTNUM 1 \l 1393 Let's begin with the diversity of commercial editorial voices, also described as editorial pluralism or viewpoint diversity.
LISTNUM 1 \l 1394 This is a subjective notion and, thus, hazardous, in our view, for policy makers.
LISTNUM 1 \l 1395 The British regulator, Ofcom, admits that there is no accepted way of measuring viewpoint plurality, and rejects the idea that media ownership is an acceptable proxy.
LISTNUM 1 \l 1396 For example, differently owned media outlets use the same news sources.
LISTNUM 1 \l 1397 This is the case in Canada with Canadian Press and Broadcast News.
LISTNUM 1 \l 1398 Although it defies quantification, editorial diversity is a cornerstone of democracy in Canada as elsewhere. There is no body of research to demonstrate that editorial diversity is in trouble in Canadian media, because, quite simply, it is not. It is alive and well.
LISTNUM 1 \l 1399 No evidence exists or suggests any demonstration that consolidation or concentration can strain editorial diversity.
LISTNUM 1 \l 1400 What is more, the explosion of internet use has promoted new outlets for viewer‑generated content and citizen interaction.
LISTNUM 1 \l 1401 Canadian television and radio broadcasters enrich their stories by engaging audiences interactively online, adding the audience's voice to the editorial orchestra.
LISTNUM 1 \l 1402 Let me turn to diversity in programming choices, which is more plentiful in all media formats today than at any time in our history.
LISTNUM 1 \l 1403 It springs from the depth of format and demographic diversity in Canadian markets, and the investments of broadcasters in Canadian content and choices.
LISTNUM 1 \l 1404 The depth of format diversity in the regulated component of the Canadian marketplace is without parallel. In the Toronto market alone, over the course of the past decade, there has been a greater than 200 percent increase in the number of television services available to viewers, from 82 in 1996 to more than 260 services today.
LISTNUM 1 \l 1405 The level of ownership diversity has also risen. Twenty‑one new companies have entered the pay and specialty sectors since 1997.
LISTNUM 1 \l 1406 Barriers to entry have come down in radio, as well, with new entrants coming onstream.
LISTNUM 1 \l 1407 In total, Canada today can boast over 1,590 private radio and television stations, in addition to the national public broadcaster and networks of campus and community stations across the country.
LISTNUM 1 \l 1408 These developments have resulted in audience fragmentation on an unprecedented scale. As a response to this phenomenon, ownership consolidation has occurred. Consolidation enables media companies to reaggregate fragmented audiences to preserve the economies of scale that are necessary to sustain program acquisition and content creation.
LISTNUM 1 \l 1409 While critics suggest that consolidation undermines format diversity, we believe the opposite is true. Owners of multiple outlets in a given market have an economic interest in covering as many diverse niches as possible, without duplication.
LISTNUM 1 \l 1410 Evidence that this model naturally encourages diversification can be observed in the Ottawa‑Gatineau market here, where three ownership groups operate ten highly diversified radio stations in two languages.
LISTNUM 1 \l 1411 Demographic diversity is enshrined in the Broadcasting Act, but it has also been stimulated by the economic realities of Canada's ever‑changing population. The regulated broadcasting sector offers services in 45 languages today.
LISTNUM 1 \l 1412 From 1996 to 2006, Aboriginal, ethnic and multicultural broadcasters have flourished, with tuning to multilingual programming in major Canadian markets rising from 163 percent in Toronto to an even more significant increase in Ottawa.
LISTNUM 1 \l 1413 Such levels of demographic diversity make Canada the envy of the world.
LISTNUM 1 \l 1414 Diversity in programming choices is facilitated by consolidation. With economies of scale that provide critical mass, consolidated media companies can acquire or create programming which they then can exhibit sequentially in windows across multiple platforms.
LISTNUM 1 \l 1415 Large, well‑funded companies are vital to Canadian content production, as several stakeholders on the creator side acknowledge in their submissions.
LISTNUM 1 \l 1416 Spending on Canadian content has increased, not decreased with consolidation.
LISTNUM 1 \l 1417 Between 2001 and 2006, private conventional television increased total expenditures on Canadian programming by almost $100 million.
LISTNUM 1 \l 1418 Pay and specialty Canadian program expenditure increases are to the tune of $283 million over the same period.
LISTNUM 1 \l 1419 New rules, therefore, limiting ownership of multiple broadcasting properties are not necessary to improve this output. Broad public policy measures support a robust program rights market in Canada, producing $8 billion in direct revenues and over 26,000 jobs.
LISTNUM 1 \l 1420 While it is to be expected that certain stakeholders will argue for incremental financial commitments from broadcasters to support their particular businesses, it is important to remember that labour market stimulation is not one of the objectives of the Broadcasting Policy.
LISTNUM 1 \l 1421 Moreover, in an age of declining profitability, introducing new micro‑regulatory oversight of content spending will simply constrain multiplatform content creation at a time when original Canadian content production has never been more expensive.
LISTNUM 1 \l 1422 MME BELL : Nous avons vu d'autres pays tentés, sans succès, de formuler des règles pour limiter la concentration. Ce simple constat devrait déjà nous mettre en garde, mais si le Conseil en venait à penser qu'il faut absolument des règles, s'inspirer de l'expérience de ces pays serait, à notre avis, commettre une grave erreur.
LISTNUM 1 \l 1423 Les règles dont se dotent d'autres pays répondent aux conditions particulières qui caractérisent ces pays et ne sont pas conçues pour les Canadiens.
LISTNUM 1 \l 1424 Take Australia for an example. We share a common language but our broadcasting systems could not be more different. Australia developed its own point system for measuring concentration to respond to changes in the business environment produced by easing restrictions on foreign ownership. That was the driver of change. There is no such change in Canada.
LISTNUM 1 \l 1425 I could go on but I think the point has been made. No new rules are necessary and rules from elsewhere will not work.
LISTNUM 1 \l 1426 J'en arrive maintenant au Code d'autoréglementation du CCNR à l'usage des médias de propriétés mixtes. Ce code a bien réussi jusqu'à maintenant à garantir l'indépendance éditoriale, qui est, comme je l'ai dit, profondément ancrée dans la culture des salles de nouvelles de tous les médias. Il n'y a rien qui incite à penser le contraire.
LISTNUM 1 \l 1427 Dans les activités de collecte de nouvelles, il est courant de voir des réseaux concurrents de partager le même avion nolisé ou l'alimentation par satellite. On ne redoute jamais la contamination éditoriale lorsque les réseaux rivaux font des partages logistiques. Alors, pourquoi se mettre à imposer des restrictions aux entreprises de médias mixtes?
LISTNUM 1 \l 1428 Le code maintiendrait la séparation structurelle des nouvelles et de la gestion éditoriale, mais il éliminerait les restrictions improductives sur la collecte des nouvelles au Québec.
LISTNUM 1 \l 1429 Un des syndicats s'oppose à l'adoption de ce code sous prétexte qu'il n'a pas été écrit par les journalistes. Là n'est vraiment pas la question. Ce qui intéresse les Canadiens, c'est d'avoir davantage de nouvelles qui viennent de régions difficiles d'accès comme l'Afghanistan et de ne pas être limité en cela par une réglementation.
LISTNUM 1 \l 1430 MR. O'FARRELL: Mr. Chairman, this hearing is timely. It allows the Commission to confirm and, we believe, revalidate its approach to diversity. To do so, we submit that a mature conception of the public interest in this new environment is required, an environment consisting of an ever‑expanding unregulated media component, and a regulated media component that was conceived on the basis of controlled market entry.
LISTNUM 1 \l 1431 A mature conception in this regard, in our view, should deal with two fundamental principles: what is in our interest to prevent, first of all; and second of all, what should we seek to accomplish?
LISTNUM 1 \l 1432 To the first question we answer: It is in the public interest to prevent consumers or to encourage consumers from not checking out of the Canadian broadcasting system.
LISTNUM 1 \l 1433 To the second question we answer: It is in the public interest to strengthen all Canadian programming services, both public and private, to ensure that they are given every opportunity to remain relevant to the Canadian audience.
LISTNUM 1 \l 1434 We recommend that these principles guide you in your deliberations.
LISTNUM 1 \l 1435 This concludes our remarks, and we would be pleased to take your questions and offer all answers that are available to us.
LISTNUM 1 \l 1436 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 1437 First, a preliminary issue. You probably are aware that some of the intervenors have criticized us for holding this hearing and not providing the necessary background, especially financial, et cetera ‑‑ and especially as it concerns broadcasters; that disclosure on large broadcasters is not the same as on specialty and pay services, suggesting that, really, this hearing cannot be held unless such disclosure was made.
LISTNUM 1 \l 1438 We have notified everybody, including you, that we would ask the question: How would you feel, not for this hearing, but generally, if the CRTC were to adopt a rule for the disclosure of financial information for broadcasters similar to specialty programming?
LISTNUM 1 \l 1439 Could you comment on that, please?
LISTNUM 1 \l 1440 MR. O'FARRELL: I will ask my colleague Pierre‑Louis Smith to give you the details, but our submission and our position, I think, is quite clear in our response, and I think it is consistent with how the Commission should conceive its role, in terms of regulating the system going forward on a basis of fairness.
LISTNUM 1 \l 1441 Pierre‑Louis.
LISTNUM 1 \l 1442 MR. SMITH: Yes, we believe that it is important to have information for the public, but that providing detailed financial information per services, including for radio and for television, wouldn't be warranted. And we believe that the Commission has decided that it would apply it for specialty services because they were in a situation of one per genre, which is not the case for conventional television nor radio.
LISTNUM 1 \l 1443 Does that answer your question, Mr. Chair?
LISTNUM 1 \l 1444 THE CHAIRPERSON: So you basically are putting our rationale to me and saying it is valid rationale and continue as you have done in the past?
LISTNUM 1 \l 1445 MR. SMITH: That is right, that is correct.
LISTNUM 1 \l 1446 THE CHAIRPERSON: Okay. In terms of plurality, I must say I am somewhat surprised by your answer. You basically suggest we don't need to do anything in terms of plurality, that there is no accepted way of measuring plurality and essentially we do not have a problem in Canada.
LISTNUM 1 \l 1447 Does it suggest, for instance, the Australian has this two out of three rule, implying it goes to national and local markets? Let us take a local market. If I understand you correctly, we don't need such a rule, so you don't see any problem in a local market, the same company owning radio stations, TV stations and dailies?
LISTNUM 1 \l 1448 MR. O'FARRELL: Thank you, Mr. Chairman. No, we frankly see no diversity deficit in the Canadian broadcasting system first and foremost. We see a diversity surplus.
LISTNUM 1 \l 1449 Secondly, if we look at the numbers, I think they speak for themselves. If you look at where we are today in 2007 as opposed to where we were in 2002 and look at the growth in number of services available to Canadian consumers ‑‑ and I won't walk you through all the numbers, but I will give you just the bottom line ‑‑ in the total Canadian picture we saw overall an increase over that period, 2002 to 2007, five years, a 45 per cent increase in services available to Canadians. Now, that is the big picture.
LISTNUM 1 \l 1450 If you want to take it market by market across the country, as many of my colleagues on this panel will tell you, there is no diversity deficit in our view. There is a diversity of programming surplus, which is why we feel that there are no new rules required and why we think that this is an opportunity for you to revalidate what you have done because you have done it well.
LISTNUM 1 \l 1451 It has been a public policy test that you have applied consistently, different generations of commissioners have done so in licence renewal hearings, in licence application hearings and in transfer of ownership hearings overwhelmingly to the satisfaction of what we would call the public interest.
LISTNUM 1 \l 1452 THE CHAIRPERSON: Okay, let us not confuse terms here. I was talking about plurality, I was not talking about diversity of programming. I was talking plurality, which we explained quite clearly, to me, talking about the availability of professional editorial voices and I am talking about a given market. The CBC may have said basically, we are fine where we are right now, but we have to watch out for the future and let us make sure ‑‑ if I understood them, and you were here, you heard yourself ‑‑ make sure it does not get worse.
LISTNUM 1 \l 1453 And this whole hearing was sparked partially because of the fear that the ongoing consolidation in the industry would diminish the number of voices which express different viewpoints. And therefore, I am asking the plurality, not diversity of programming, plurality of voices and I am talking about professional editorial voices, that is how we made it quite clear.
LISTNUM 1 \l 1454 You do not feel we need a whole, like the Australian for instance, just to take one example, we don't need to do anything, the situation is fine and can go on. And we do not have a cross‑ownership rule, so therefore having a single owner in a local market owning all three professional editorial outlets, be they TV, newspapers or radios, in your view, does not cause a problem?
LISTNUM 1 \l 1455 MR. O'FARRELL: That is correct, Mr. Chairman. We do not believe that new rules are required. Looking at the Australian example, and I think Vice‑Chair Arpin qualified the situation correctly, in our view, with regard to the situation in the market that was referred to in the earlier presentation, we do not believe there is a diversity deficit there either.
LISTNUM 1 \l 1456 But as to the usefulness of taking a model such as the Australian model, conceived in a very different marketplace as we all know, that we don't need to go through those details, and bringing it here and seeking to give it currency or application here simply is not a useful exercise.
LISTNUM 1 \l 1457 THE CHAIRPERSON: That wasn't my question. I am just purely thinking whether should we do something on plurality of voices or not prospectively? That is really what ‑‑ and I think you answered it.
LISTNUM 1 \l 1458 Commissioner Arpin.
LISTNUM 1 \l 1459 MR. O'FARRELL: Mr. Chairman, with your permission, I believe Mr. Maavara would like to add a word on that.
LISTNUM 1 \l 1460 THE CHAIRPERSON: Sure.
LISTNUM 1 \l 1461 MR. MAAVARA: I just wanted to add, Mr. Chairman, that in fact you already have an extensive set of rules. And when one looks at the application of any test I would submit that you have started in the right place, which is the particular market that you are looking at. And I would submit that you have to drill down even deeper and, in fact, look at what is the viewer getting, because that is where the Broadcasting Act starts and ends, it is about Canadians.
LISTNUM 1 \l 1462 In terms of the rules that you have now, in radio you have limits on the ownership of AM and FM frequencies. In television, as you are well aware, we have just had an extensive hearing testing the one‑stick rule and there have been some exceptions to that. But that, again, promotes plurality of voices within a given market.
LISTNUM 1 \l 1463 And then there are a host of other tools that you have; the first one being, of course, licensing and the ability to introduce new voices, the second being approval of transfers. So we would submit that the toolkit that you have now is quite extensive and effective. When you start from a market basis, the fact of Canada is that every single place in Canada is different and the Commission has, over its regulatory life, chosen to look at each market as being distinct and the rules have to be distinct. There isn't a cookie cutter rule that you can apply across the nation.
LISTNUM 1 \l 1464 THE CHAIRPERSON: No, I couldn't agree more with you, we do have rules. I mean, my question to Mr. O'Farrell was very simple and I was somewhat astonished by the position of your association that on plurality, even going forward, you did not see any problems. But, I mean, none of us has a crystal ball, so it is your view and I appreciate it.
LISTNUM 1 \l 1465 Michel.
LISTNUM 1 \l 1466 COMMISSIONER ARPIN: Thank you, Mr. Chair. I will start my questions where Mr. Pierre‑Louis Smith left us regarding access to information regarding radio and television.
LISTNUM 1 \l 1467 I heard your reply saying it was not warranted. The thing is that most of the players that we are talking about here are publicly traded companies who in their financial notes are divulging most of that information, at least in an aggregate way. And what the Commission is seeking from you and discussing here is the opportunity to release them through the system that the Commission has put in place over the years.
LISTNUM 1 \l 1468 Very few of the companies that are represented at this table are not publicly traded. I can see CTVglobemedia being one and Golden as being another one. But all the others here are publicly traded companies where a good portion of the financial information that we are talking of here is available, at least annually and sometimes on a quarterly basis.
LISTNUM 1 \l 1469 There is also other sources of information that from time to time gives us some leads. I know that some of your members have a rep house which from time to time are publishing news releases and in which they gave some indication to the trade. So I don't think that what the Commission wants to release in terms of information is hurtful in any way to your members. But I surely wish to hear more about it.
LISTNUM 1 \l 1470 MR. MAAVARA: Mr. Vice‑Chair, Corus Entertainment is a publicly traded company, we are traded both in New York and on the Toronto Stock Exchanges. And the information that we provide to the market, and perhaps we are talking about how this information would be divulged, but obviously we have no objection to the provision of information to the CRTC itself. The question is how the information is displayed to the public on a per station basis. That is what our concern is.
LISTNUM 1 \l 1471 In terms of our disclosure, we disclose information on a segment basis, in our case a radio segment or a production segment or a television segment. The difficulty that we have when we go to capital markets if we have disclosures that are different than either untraded companies or companies that don't have to disclose this kind of information, is that it impinges on our ability to raise capital. And in that sense, we would make the argument that in fact the regulation, because it is not uniform, is actually hurting us.
LISTNUM 1 \l 1472 I guess the second point is that as a regulated entity certainly the CRTC has the right and the ability to understand how we are doing. But we deal everyday with large segments of players who don't in fact have to disclose, for example, the carriers who carry us and even for an over‑the‑air broadcaster that is an important issue these days, as you are aware. And the suppliers who supply us with programming also don't have to disclose. So again, it goes to the matter of fairness and our ability to conduct business successfully.
LISTNUM 1 \l 1473 We make the position that it is enough for the regulator to understand how we are doing, but if we are forced to disclose ‑‑ and I might add our stations have gone 50 years without having to do so and we are submitting that this is not the time to start doing that.
LISTNUM 1 \l 1474 COMMISSION ARPIN: Well, I think the way the Commission is contemplating releasing the information, and that is what we said in our letter, is that we were looking to release aggregate numbers, not on a per station basis, but based on a very similar model that we are using for specialty services. But not on a per station basis, but by group; I will say radio, television and BDUs. We will have an opportunity to discuss with the carriers, later on in the winter, and it is also our intention to raise a similar issue with them at that time. So it will put everybody on the same footing.
LISTNUM 1 \l 1475 And while you were saying that you were concerned about having two sets of numbers coming up, the Commission has been releasing your discretionary services numbers for years now and, to my knowledge, it hasn't forbidden Corus to raise any capital when they sought the need to go to the market to raise new capital.
LISTNUM 1 \l 1476 MR. O'FARRELL: Mr. Vice‑Chairman, if I may. I think to the broader question that you ask and I thank you for adding the additional information that you did in your follow‑up, and that is it is a matter of fairness across the system that concerns us fundamentally. And you made reference to the other opportunities the Commission will have to bring that fair approach to other sectors so that we have a model of disclosure across the system that works for each of its individual segments. That is really what is motivating us in our response, which is moving to that model.
LISTNUM 1 \l 1477 And yes, it is appropriate for the Commission to raise this question in this proceeding because you had the suggestion made to you and felt that it was appropriate to bring it forward for discussion. But having these discussions one off here for this sector and there for that sector does not necessarily give us a sense of comfort that we are looking at this with one set of eyes that is going to be fair across all sectors that is going to make sense for the system. That is the first point I wish to add.
LISTNUM 1 \l 1478 But we are not philosophically or in principal opposed to more transparency, that certainly is not our position. The second point though is there are multiple members in this organization. Yes, the representation of this table has it weighed more to the publicly traded constituency than the non‑publicly traded constituency. But there are a good number of privately‑held companies that are operating broadcasting undertakings and that are members of the CAB and they have other levels of concerns that are not quite those of the large publicly traded companies that I feel have to be reflected also and should be reflected in that broader fairness discussion.
LISTNUM 1 \l 1479 Charlotte I think wanted to add something.
LISTNUM 1 \l 1480 COMMISSIONER ARPIN: I really hear you but, as we said in our letter, we were talking about major players, not, obviously, the operator of a sole radio station in a remote location. We are talking here major players. I will say those at your table.
LISTNUM 1 \l 1481 MR. O'FARRELL: But I think the question is: when do we have the full discussion and when do we put this issue broadly to bed one time ‑‑
LISTNUM 1 \l 1482 THE CHAIRPERSON: We clearly will have that situation, Mr. O'Farrell, in the BDO hearing, but because it was raised by several intervenors, we thought it was fair to find out from you right here.
LISTNUM 1 \l 1483 MR. O'FARRELL: Yes.
LISTNUM 1 \l 1484 THE CHAIRPERSON: Our question is, Mr. Arpin point out, multi‑station owners, aggregated basis, and I gather you are saying even on that basis your answer is no.
LISTNUM 1 \l 1485 MR. O'FARRELL: That is correct.
LISTNUM 1 \l 1486 MS BELL: As a multi‑station group, and one of the groups who received that letter, I think there is a distinction that should be made between the speciality sector and the conventional television sector.
LISTNUM 1 \l 1487 For example, there are much fewer players on the conventional side and there are probably two large multi‑station groups on the conventional side.
LISTNUM 1 \l 1488 I don't know if Rogers or...well, you haven't approved that transaction yet, but if we found ourselves in a situation where, for example, CTV and Global now had access to each others spending by program category for both foreign and Canadian programming, I would suggest that would put us both at a bit of a competitive disadvantage.
LISTNUM 1 \l 1489 We like to collaborate on certain things, I'm not sure that we want to be sharing that information with each other.
LISTNUM 1 \l 1490 COMMISSIONER ARPIN: My guess is that Mr. Brace may not know by the dollar how much Global is spending on foreign programming, but he has a fairly good idea. So maybe. So anyhow ‑‑
LISTNUM 1 \l 1491 MS BELL: We don't want to help them.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 1492 COMMISSIONER ARPIN: Anyhow, we have your answer for the record, so I thank you very much for that.
LISTNUM 1 \l 1493 Obviously, we will have similar questions with the individual players that will appear before us over the next couple of days.
LISTNUM 1 \l 1494 M. LAMPRON : Excusez‑moi, Monsieur Arpin. Juste pour bien comprendre la dynamique, est‑ce que vous avez envoyé la même lettre à CBC/Radio‑Canada pour recevoir le même genre d'informations?
LISTNUM 1 \l 1495 CONSEILLER ARPIN : Nous publions les données financières de Radio‑Canada à chaque année.
LISTNUM 1 \l 1496 M. LAMPRON : Et vous y trouvez quelque chose de significatif?
LISTNUM 1 \l 1497 CONSEILLER ARPIN : Écoutez, nous publions ce que nous recevons.
LISTNUM 1 \l 1498 C'est une question, d'ailleurs, qui n'est pas sans intérêt, et maintenant, en vertu de la Loi sur l'accès à l'information, peut‑être que Radio‑Canada sera dans l'obligation de rendre public davantage d'information financière dans l'avenir.
LISTNUM 1 \l 1499 MME BELL : Est‑ce que je peux juste vous rappeler aussi, Monsieur le Vice‑président, à l'occasion des renouvellements de télévision conventionnelle en 2001, le Conseil a publié de l'information plus détaillée à ce moment‑là pour aider justement les intervenants dans ce processus‑là.
LISTNUM 1 \l 1500 Je ne sais pas si c'est nécessaire de faire la même chose à tous les ans, et puis je pense que l'information n'étais pas aussi détaillée que l'information que le Conseil publie pour les services spécialisés. Mais en tout cas, c'est encore une autre façon peut‑être de regarder la question.
LISTNUM 1 \l 1501 CONSEILLER ARPIN : Écoutez, je pense qu'on va passer à d'autres questions, mais on aura l'occasion de revenir avec chacun des joueurs.
LISTNUM 1 \l 1502 A review of other jurisdictions on pluralism of voices indicates that their concern deals with the local media that are radio, television and newspaper, I think.
LISTNUM 1 \l 1503 In your submission, you are suggesting that the Commission take a wholistic view of the media landscape.
LISTNUM 1 \l 1504 Why Canada shall have a different approach to countries such as the U.S., the U.K., France, Ireland, Germany, Austria and Australia, taking into consideration that these countries are confronted with the same unregulated sector? What is so different in Canada to deal with this issue in a different way?
LISTNUM 1 \l 1505 MR. O'FARRELL: Mr. Vice‑Chairman, we are not suggesting that our realities are any better or any more difficult or any more challenging than other realities, but they are our realities. I think that we all recognize when we speak about the Australian model, for instance, that the first glaring distinction that can be made is that 70 per cent of Australians receive their television services over the air.
LISTNUM 1 \l 1506 How does one take a model built in a reality defined by that kind of an element and bring it into a reality such as ours and start making any sense of it? You can take each international model that was developed, we know, with tremendous effort, and I'm sure very thoughtfully, but find equally difficult circumstances to overcome, which is why we suggest that this Commission revalidate its approach which it has been using, which is, in our view, a useful approach because it has produced a surplus in diversity, not a deficit in diversity?
LISTNUM 1 \l 1507 If there were a problem maybe we would have a different view that there are answers elsewhere that have been found and applied to the same problem that can be imported, but there is no evidence on the record that suggests there is a problem. What some of the intervenors are suggesting in the way of recommendations to the Commission are solutions looking for a problem that doesn't exist, largely.
LISTNUM 1 \l 1508 Therefore, what we think we need to do is step back and say, "What has this system done well?". Not to say that there aren't things that can't be improved, but it has applied a public policy test based on, as Mr. Maavara was saying earlier, some rules that are on the books, whether it's in television or in radio, and then circumstances and the dynamic of a public dialogue, where parties will present themselves at the time of licensing applicants for a new radio licence or renewal of licence in a television market or transactions on changes of ownership.
LISTNUM 1 \l 1509 We believe that the Canadian model has worked well, we believe that it has produced the surplus and diversity, and we don't believe that there is anything on the record that we have seen that shows that Canada has a diversity problem.
LISTNUM 1 \l 1510 And I'll add one last comment, which is to say ‑‑ and I'm talking television here ‑‑ if you look at the number of Canadian indigenous services available to Canadian consumers today, on a per capita basis, there are more Canadian indigenous services available to Canadians on that per capita basis than there are American indigenous services available to Americans on a per capita basis.
LISTNUM 1 \l 1511 I'm not sure that same test applies in every jurisdiction across the world, I haven't done the exercise, but right now, if you look at it, that is the state of our condition. There is no diversity deficit; there is a diversity surplus.
LISTNUM 1 \l 1512 Our point to you, frankly, is how do we sustain that diversity? How do we make sure that Canadian voices and Canadian operators can continue to have circumstances that allow them to stay in play so that Canadian consumers aren't encouraged to check out of the system?
LISTNUM 1 \l 1513 That's why we suggested two principles: what can we prevent and what can we accomplish going forward? Preventing people from finding encouragement to check out of the system would be dramatic, in our view. We need to prevent them from checking out of the system.
LISTNUM 1 \l 1514 What can we do to accomplish? We need to create situations where both public and private broadcasters can use every tool available to them to remain relevant in a world that exploding with choice every day.
LISTNUM 1 \l 1515 MS BELL: Can I just add one point on the Australian model? I apologize for interrupting, but you made a very valid point earlier this morning, Vice‑Chairman Arpin.
LISTNUM 1 \l 1516 On the Australian model, in fact, the Nordicity study did not apply the criteria appropriately. We did analyze every major market in Canada using the criteria and applying it appropriately. Mr. Goldstein, who'll be appearing with CanWest, on our panel, actually did this, we are happy to file it if it's of any use to the Commission, but there's not one single market where, in fact, there would be a diversity problem based on the Australian model. We have done it across the board.
LISTNUM 1 \l 1517 COMMISSIONER ARPIN: I could mention Iqaluit.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 1518 MS BELL: That wasn't a major market.
LISTNUM 1 \l 1519 COMMISSIONER ARPIN: But it's a capital.
LISTNUM 1 \l 1520 UNIDENTIFIED MALE SPEAKER: A capital city.
LISTNUM 1 \l 1521 COMMISSIONER ARPIN: It's a provincial capital.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 1522 MS BELL: I stand corrected.
LISTNUM 1 \l 1523 COMMISSIONER ARPIN: Or a territory. And I would suspect Whitehorse probably has the same problem, but...well, I think if you want to file it, we could compare notes. I think everybody has done the exercise for the very purpose of this hearing.
LISTNUM 1 \l 1524 You are saying that there is no deficient diversity, to the contrary there is surplus diversity. Obviously, it's not a view that is shared by every intervenor in this proceeding and some are drawing our attention to the weakest component of the broadcasting system, which is not, obviously, the private nor the public system, but the community sector and also the ethnic component of the private sector.
LISTNUM 1 \l 1525 There has been a suggestion that the Commission should put in place a mechanism in order to grow these voices. Does the CAB have any suggestions to make on these interventions?
LISTNUM 1 \l 1526 MR. O'FARRELL: Yes, we do. We, again, believe that you should hold the course of your public policy test, and let me give you one example.
LISTNUM 1 \l 1527 You all are familiar with the CEO of South Asian Television Network, who would have liked to be here with us today but was not able to be here, Shan Chandrasekar. Ten years ago, Shan Chandrasekar wasn't a broadcaster. South Asian Television Network was not a licensee, roughly speaking.
LISTNUM 1 \l 1528 Today, in that ethno‑cultural market, that company operates 14 discretionary services in 20 languages ‑‑ and I'm sure even Shan doesn't know how many dialects sometimes ‑‑ to a diverse community that is growing and is very much looking for services from the Canadian Broadcasting System across the country, located in markets everywhere.
LISTNUM 1 \l 1529 There is an example of how the system served not only that marketplace well, but served the economic model, which was aggregation of services in a situation like that was the only way, frankly, to develop services for that marketplace, because it would be hard to imagine how 14 different players could be viably operating 14 different discretionary services without the economies of scale of aggregation through common ownership.
LISTNUM 1 \l 1530 That is an example of the kind of measures that this Commission has taken in its licensing decisions, in its attribution of licensing policies, and we think that should be maintained.
LISTNUM 1 \l 1531 On the topic of discretionary services, I think that Sophie Émond may want to add something, and perhaps Pierre‑Louis.
LISTNUM 1 \l 1532 There she is. Hi, Sophie.
LISTNUM 1 \l 1533 Vas‑y, Sophie, de l'avant.
LISTNUM 1 \l 1534 MME ÉMOND : Merci, Glenn.
LISTNUM 1 \l 1535 Bien, je pense c'est un des meilleurs exemples où justement une propriété aussi regroupée a permis de maximiser une diversité de l'offre de services dans le domaine multiethnique, ce qui m'amène un petit peu aussi à parler de la propriété commune, généralement, en spécialisés payants.
LISTNUM 1 \l 1536 On a entendu les commentaires ce matin de Radio‑Canada, et je pense que ce qui nous apparaît vraiment fondamental comme radiodiffuseur, si on veut avoir une diversité des voix, ce qui est primordial, c'est qu'il y a un accès à ces voix là ‑‑ et c'était, d'ailleurs, un des commentaires de monsieur Stursberg ce matin ‑‑ donc, ce qui nous apparaît plus important que le critère de propriété, qui en soi n'est pas gage de programmation plus variée ou moins variée.
LISTNUM 1 \l 1537 On le voit, par exemple, dans le marché francophone. Je peux parler du cas de notre propre compagnie, Astral, où on a des genres extrêmement variés et différents avec des natures de services très distincts, et chacun de ces services là aussi a, évidemment, été autorisé par le Conseil après un processus où le choix du Conseil se portait sur le service qui apporte le plus de diversité en terme de programmation.
LISTNUM 1 \l 1538 Donc, en terme de diversité des voix, on pense que, essentiellement, c'est plus la question de l'accès qui est primordiale plutôt que la propriété en soi.
LISTNUM 1 \l 1539 M. SMITH : Et en ce qui a trait au premier volet de votre question par rapport à l'appui au secteur communautaire, je pense qu'il faut noter que le Conseil a déjà fait un pas dans cette direction‑là dans sa révision de la politique sur la radio, en permettant au secteur communautaire d'avoir accès à des contributions au développement de contenu canadien, et à ma connaissance, il n'y a pas eu de démarche de la part du secteur communautaire auprès des entreprises de radiodiffusion ou de l'ACR pour les inciter à contribuer à ce fonds‑là.
LISTNUM 1 \l 1540 CONSEILLER ARPIN : Vous m'ouvrez la porte. Vous ouvrez la porte de la grange pour faire sortir le cheval.
LISTNUM 1 \l 1541 Vous venez de dire qu'il n'y a personne qui a approché l'ACR. Or, s'ils approchent l'ACR, vous allez leur dire quoi?
LISTNUM 1 \l 1542 M. SMITH : Que c'est ouvert, qu'il y a plusieurs possibilités pour les intervenants du système d'avoir accès à des contributions au développement de contenu canadien, qu'ils ont à faire des propositions en ce sens‑là pour inciter les radiodiffuseurs à faire des choix.
LISTNUM 1 \l 1543 Le Conseil a déterminé de façon statutaire que 60 pour cent des contributions devaient aller à FACTOR et à MUSICACTION. Autrement, c'est une liste de récipiendaires potentiels qui peuvent avoir accès, et dépendamment aux propositions qui vont être mises sur la table, les radiodiffuseurs pourront se prononcer là vers où ils souhaitent apporter leur soutien.
LISTNUM 1 \l 1544 CONSEILLER ARPIN: Ça, c'est chaque radiodiffuseur individuel, mais vous avez vous‑même dit que si on approchait l'ACR, que l'ACR pourrait être le... canaliser ces demandes‑là ni plus ni moins, donc, devenir peut‑être un instigateur d'une solution.
LISTNUM 1 \l 1545 Or, quelle sorte de solution vous seriez prêt à apporter?
LISTNUM 1 \l 1546 M. O'FARRELL: Nous n'avons pas envisagé de solution détaillée ou articulée à vous soumettre ici ce matin. Je pense que ce que mon collègue vous a dit, c'est une démonstration de l'ouverture d'esprit et puis de l'approche que nous serions prêts à prendre devant de telles demandes.
LISTNUM 1 \l 1547 Mais pour aller plus loin que ça, nous n'avons pas autre chose à rajouter.
LISTNUM 1 \l 1548 CONSEILLER ARPIN: Quand je reviens sur le... I'm coming back to the ethnic component.
LISTNUM 1 \l 1549 Obviously, you draw to our attention the situation of ATN, but the deficiency and diversity that is also mentioned is the ownership by the visible minority in the more traditional broadcasting system.
LISTNUM 1 \l 1550 Obviously, they are late comers, but they do not seem to have ‑‑ to the ownership and in many areas where there is no more frequency left. So, that is a big issue.
LISTNUM 1 \l 1551 But do you think that the Commission should be concerned by the fact that the current broadcasting model doesn't give rise to minority ownership?
LISTNUM 1 \l 1552 MR. O'FARRELL: We don't think that there is any problem with the current broadcasting model. We think the circumstances in prior proceedings have dictated outcomes.
LISTNUM 1 \l 1553 I think there is a new sensitivity both on the Commission's level and in the industry's level to take every favourable action possible to ensure that diversity is alive and well.
LISTNUM 1 \l 1554 And we feel that within the framework that is already there applying, what the Commission applies when it is considering applications for new licences, that is it all the discretion required and all of the authority required to take the right decisions on the basis of the particular circumstances that will be before it.
LISTNUM 1 \l 1555 COMMISSIONER ARPIN: Thank you. We will now move to the other aspect of this hearing, which is more the diversity by itself.
LISTNUM 1 \l 1556 In your submission, you have mentioned that scholars identify three types of diversity : diversity of format, demographic diversity and I.D. diversity.
LISTNUM 1 \l 1557 Then, in developing this third type of diversity, you have written that, and I quote :
"The larger media companies are still big, but then audiences have been considerably reduced inside. As a result, today's dominant voices are far weaker than in the past."
LISTNUM 1 \l 1558 To support your evidence, you suggest that the lost audience has moved to the conception of unregulated parallel content market and that this market is becoming a driver in I.D. diversity.
LISTNUM 1 \l 1559 For example, you state that now bloggers have been accepted in the Parliamentary Press Gallery where, previously, only the members of the more formal press were accepted as working journalists.
LISTNUM 1 \l 1560 Could you tell us who are these bloggers and generally speaking, aren't they working for the main existing media?
LISTNUM 1 \l 1561 MR. O'FARRELL: I think the simple answer is some are and some aren't.
LISTNUM 1 \l 1562 COMMISSIONER ARPIN: Because a study I think that was conducted last July by Comscore tells us that of the 12 online news sources consulted by Canadians, half of them were Canadian and as a matter of fact, the first four were operated by Canadian broadcasters, which are CBC, Quebecor, CTV and CanWest.
LISTNUM 1 \l 1563 From this evidence, could we conclude that the lost audience of the major Canadian broadcasters is recuperated by their non regulated service?
LISTNUM 1 \l 1564 MR. O'FARRELL: I think there are many dimensions to that answer and I'm going to ask Sophie Émond to speak to that and then, maybe Linden Friesen can also speak to it on the level of local radio station and the transfer of audience or the extension of audience to radio and the new media operations that GoldenWest is involved in.
LISTNUM 1 \l 1565 But as a preliminary view, very quickly, if I may, I think that we have to be careful about what statistics we are looking at in terms of most popular web sites in Canada on the basis of one filing or another filing because it doesn't seem to be a standardized approach yet that meets everybody's expectations as to what the criteria should be or what the measurements should be.
LISTNUM 1 \l 1566 We were looking at material this morning again that showed that there was no Canadian site in the top 25. And then, in another piece, two Canadian services are in the top 25 : one is the CBC and the other one, Telmorex.
LISTNUM 1 \l 1567 So, I think that there are a whole variety of measurements out there of what Canadians are using in the online world that has been developed. I don't say can thrive, but developed with an outlooking line that doesn't necessarily fit the same purpose or doesn't necessarily migrate to all applications.
LISTNUM 1 \l 1568 So, Sophie, would you take it from here?
LISTNUM 1 \l 1569 Mme ÉMOND: Bien, Glenn, essentiellement, c'était le... l'évidence qu'on se faisait c'est tant mieux s'il y a des services canadiens parce que, comme on se disait de plus en plus, il y a cette migration possible vers les nouveaux médias.
LISTNUM 1 \l 1570 Au Canada, on est quand même parmi les pays du G‑8, celui où il y a la plus forte pénétration de broad band et on a quand même 60 pour cent des Canadiens qui utilisent l'internet haute vitesse.
LISTNUM 1 \l 1571 Et le fait d'avoir au moins des voix canadiennes, quelques‑unes déjà c'est bien, mais en même temps c'est très inquiétant de constater que parmi les 25 sites les plus populaires, il y en a très peu qui sont Canadiens.
LISTNUM 1 \l 1572 Alors, il faut, selon nous, au contraire, encourager la présence canadienne tant, oui, des joueurs des voix éditoriales existantes et d'autres voix aussi.
LISTNUM 1 \l 1573 MR. FRIESEN: Well, I think in small markets I am not sure it's that much different than in large markets. We've really been thinking a lot these days about the isolation of small markets in rural Canada and because of the new technologies and the new media, you know, I don't know that we're isolated any more. We have as much choice and as much diversity and as much input.
LISTNUM 1 \l 1574 The thing that sets us, I think a part in smaller parts of Canada have more to do with the kind of content that we add and I think it's imperative even in a small company such as ours, that we join the online and not only recycle all that effort that we've put into gathering local information for local communities, we have to put that online and we have to make it available for the communities to join that forum so that there is a place to talk in small communities.
LISTNUM 1 \l 1575 So, I think it's all part of the business plan for the future that I think even in small markets where it may be even more imperative there to do that work, everybody becomes kind of a voice or has a place to voice it.
LISTNUM 1 \l 1576 You know, certainly in our operation we have places where people can take video and place it online and do the cross promotion with radio. We just think we have to do that and I think in small markets the impact is as great as it has been in large markets.
LISTNUM 1 \l 1577 COMMISSIONER ARPIN: Okay. Thank you, Mr. Friesen.
LISTNUM 1 \l 1578 Numerous interveners in this proceeding are suggesting that the main concern is the service reduction in local news in the electronic media. These interveners are seeking numerous measures to correct this situation.
LISTNUM 1 \l 1579 What does the CB have to say to those interveners? So, the Commission considers rules regarding local news and if so, should these rules be concerned with news gathering?
LISTNUM 1 \l 1580 MR. O'FARRELL: I think that Charlotte and I want to add a point on this.
LISTNUM 1 \l 1581 Our answer simply is that we don't see that evidence. We don't see evidence to support those claims is what I should say.
LISTNUM 1 \l 1582 We don't see empiric evidence that we can point to with any certainly that carries the weight of ‑‑ describing a problem that is in need of a solution.
LISTNUM 1 \l 1583 There are no doubt, Mr. Vice‑Chairman, situations where an issue locally, regionally, provincially or nationally, may not have been covered the way all the audience members would have liked it to be covered.
LISTNUM 1 \l 1584 There is no doubt there are many of those and I am not sure that we would want to engage in a discussion about how they actually add up once against the other, who was the most deprived of proper journalistic or diversity coverage in a given situation.
LISTNUM 1 \l 1585 There is no doubt, but that is because it is such a subjective analysis and subjective measurement that one must bring to this.
LISTNUM 1 \l 1586 We think that when you step back and you look at the overall diversity in local markets, there is more today than there ever was before and we say to this Commission, respectfully, this Commission has had to deal with one universe and that was the regulated universe where market entry was a controlled phenomenon, but that is not the singular defining feature of the media landscape any more.
LISTNUM 1 \l 1587 We all know that there is this other world out there where the Commission does not control market entry that is defining the landscape.
LISTNUM 1 \l 1588 So, we frankly do not agree with those submissions because we don't understand the evidence to be conclusive in that regard.
LISTNUM 1 \l 1589 Charlotte, you want to add anything?
LISTNUM 1 \l 1590 MS BELL: Well, just a couple of points to supplement what Glenn said.
LISTNUM 1 \l 1591 I think there is ‑‑ I am not sure if I understand if the problem has been posed correctly, I guess, by some of the interveners.
LISTNUM 1 \l 1592 If there is a lack of local programming in certain markets, I am just going to put my ‑‑
LISTNUM 1 \l 1593 CONSEILLER ARPIN: On ne parle pas de programmation locale, mais d'information locale.
LISTNUM 1 \l 1594 MME BELL: D'information locale.
LISTNUM 1 \l 1595 CONSEILLER ARPIN: Plus spécifiquement chez la majorité des intervenants et non de programmation locale comme telle. On parle d'information locale.
LISTNUM 1 \l 1596 Je noterais, par exemple, que... évidemment, des unions font cette représentation‑là, mais dans le cas de la radiodiffusion de langue française, le Ministère des communications et de la culture du Québec fait exactement la même remarque.
LISTNUM 1 \l 1597 Donc, ce n'est pas uniquement une situation peut‑être de relations de travail, mais on a là un intervenant qui est lui‑même en tout cas plus indépendant et dans le cas du marché francophone fait le même type de remarque que les unions.
LISTNUM 1 \l 1598 MME BELL: Si vous vous adressez au marché francophone, je pense que Pierre Lampron pourrait en discuter.
LISTNUM 1 \l 1599 Mais il y a juste un point. Sur le côté anglophone par exemple, je dois dire qu'il y a de l'information locale qui est produite et qui est diffusée et qui n'est jamais vue par des grands nombres de Canadiens parce que, par exemple, on n'a pas accès au DTH dans certains marchés.
LISTNUM 1 \l 1600 Et quand la pénétration, comme à Montréal, Montréal anglais en particulier, atteint un niveau de 34 pour cent, ça veut dire que CanWest, par exemple, va diffuser 18 heures par semaine de programmation régionale qui a été conçue pour cet auditoire‑là puis déjà 34 pour cent de l'auditoire n'a même pas accès à cette information‑là.
LISTNUM 1 \l 1601 Alors, je pense que ce n'est pas une question de... On ne peut pas juste regarder le montant d'information qui est là dans le système. Il faut regarder aussi si cette information‑là est accessible.
LISTNUM 1 \l 1602 Pierre?
LISTNUM 1 \l 1603 M. LAMPRON: Oui. Je voudrais peut‑être ajouter deux choses.
LISTNUM 1 \l 1604 La première, c'est que le CRTC a plusieurs occasions de mesurer les efforts qui peuvent être faits en terme de programmation locale, je dirais, région par région, station par station.
LISTNUM 1 \l 1605 Et à chacune des fois qu'on se présente en audience, cette question‑là est soulevée et à l'analyse des faits, à la lumière des décisions qui sont prises par le CRTC, on s'aperçoit que l'effort maximum qui puisse être demandé est l'effort qui est livré.
LISTNUM 1 \l 1606 Le deuxième point qui nous désole beaucoup en particulier de la part du Gouvernement du Québec, c'est que l'affirmation qui est faite est une affirmation qui est fondée sur aucun fait qui puisse être vérifiable, mesurable.
LISTNUM 1 \l 1607 L'information locale se porte mieux qu'elle ne s'est jamais portée. Pour peu que les gens se promènent au Québec, fassent des tournées ‑‑ j'en parlais d'ailleurs à un politicien qui était engagé actuellement dans une grande tournée de toutes les régions de Québec pour des objectifs que vous pouvez imaginer ‑‑ et je lui posais la question : est‑ce que vous trouvez qu'il y a un déficit d'information dans chacune des régions que vous faites?
LISTNUM 1 \l 1608 Est‑ce que vous trouvez que par rapport à ce que vous aviez connu avant, vous vous retrouvez dans une situation de manque d'accès ou de capacité de ne pas ni transmettre votre message ni recevoir?
LISTNUM 1 \l 1609 La vérité, c'est qu'il y a une fragmentation des auditoires qui existe en région comme partout ailleurs dans le monde, que cette fragmentation des auditoires affecte un certain nombre de médias traditionnels, que l'ensemble des médias traditionnels concoure ensemble à cette diversion d'information et que, heureusement, il y a une consolidation des entreprises pour pouvoir transporter en région plus de qualité d'information et pouvoir en retirer davantage.
LISTNUM 1 \l 1610 Heureusement qu'il y a ça parce que dans toutes les régions du Québec, vous allez observer que l'addition des médias écrits, des médias électroniques, je dirais les médias spécialisés, de ce qui se retrouve via les nouveaux médias d'internet, les gens semblent imaginer que parce que tu viens d'une région, que tu ne te renseignes pas et que tu n'accèdes pas à l'information par les moyens usuels de ceux qui viennent si vous voulez dans les grands centres.
LISTNUM 1 \l 1611 C'est une des grandes grandes faussetés et qui a été entretenue dans malheureusement beaucoup de mémoires.
LISTNUM 1 \l 1612 Notre témoignage ici c'est que, à l'heure actuelle, la diversité d'information et la diversité des voix et la capacité, si vous voulez, d'être lu, d'être entendu, de s'informer et d'informer, n'a jamais été aussi importante que c'est là.
LISTNUM 1 \l 1613 Et une des causes de ça, bien, c'est ce que vous analysez dans l'ensemble de toutes les instances dans lesquelles les gens se présentent, où les gens vont intervenir pour se vanter qu'il y a tant d'heures de programmation de plus, tant de sources d'information davantage que la fragmentation des auditoires est une problématique qui va causer un certain nombre d'autres décisions.
LISTNUM 1 \l 1614 Et s'il y a fragmentation d'auditoire, dites‑vous bien que cette fragmentation d'auditoire est le plus bel exemple de la progression de la diversité des voix.
LISTNUM 1 \l 1615 MR. MAAVARA: If I might, Mr. Vice‑Chairman, just add to what Pierre said and add some regulatory fact to the allegation by the interveners.
LISTNUM 1 \l 1616 When CORRUS and ASTRAL did the swap, there was some discussion of this subject and you will recall that the Commission placed a local programming condition on the CORRUS Quebec based stations. And, of course, we are in compliance with that.
LISTNUM 1 \l 1617 But what has also happened during the period since we took over those stations is we've introduced ‑‑ well, we've introduced just before the transfer, a new FM based news radio station in Montreal and since then, we have also introduced a new news web site CORRUS Nouvelles, which is doing quite well.
LISTNUM 1 \l 1618 And, in fact, if one were to take it on a purely statistical basis, one would find that the news coverage in the Quebec local market has increased since that transaction. So, we're at a bit of a loss to understand what Pierre said.
LISTNUM 1 \l 1619 COMMISSIONER ARPIN: We move to the journalistic code and only one question. Obviously, the code that is before is a code that deals with the electronic media and newspaper.
LISTNUM 1 \l 1620 Some interveners have suggested that similar code should apply between radio and television. Has CB any opinion on that?
LISTNUM 1 \l 1621 MR. O'FARRELL: We see as we responded in writing, no need for that. Mr. Goldstein, David, may have some additional comments on the code itself, but as we responded in writing to that question, we don't see a need for that.
LISTNUM 1 \l 1622 MR. GOLDSTEIN: Only in that, and we won't go through the history because I think it was well laid out in the Public Notice.
LISTNUM 1 \l 1623 But I think we tried to deal with the cross media ownership or the perceived cross media ownership issues that could flow through from the last licence renewal. These were the mechanisms that we brought forward. There haven't been, as the Commission well knows, complaints in this area.
LISTNUM 1 \l 1624 As far as extending that to other TV or radio properties, because of the distinct ‑‑ the already distinctiveness of those two medias, I don't think that there is the same concern or it should be regulated.
LISTNUM 1 \l 1625 COMMISSIONER ARPIN: I have a few questions regarding the benefits test because, obviously, you made a statement that the benefits test has outlived its usefulness and some of your member companies are making a similar argument, but some others are not suggesting this ‑‑ are not going that far at least.
LISTNUM 1 \l 1626 Could you expand on your views and why you're saying that the benefits test is outlived?
LISTNUM 1 \l 1627 MR. O'FARRELL: Thank you very much, Mr. Vice‑Chairman. I have an excerpt here that I won't read entirely because it's too long, but I am drawing from Public Notice CRTC 1996 69 entitled "Call for comments on a proposed approach for the regulation of broadcasting distribution undertakings" dated May 17th 1996. I believe the operative component is :
"In light of the above considerations and because the Commission has already begun to license competitors to cable using DTH and MVS technologies, the Commission has concluded that it is no longer necessary to apply the benefits test in the case of transfers of ownership or control of distribution undertakings."
LISTNUM 1 \l 1628 The rest of the excerpt basically deals with :
"We are introducing competition, we are introducing new forms of distribution undertakings as competitors to cable, therefore, should the transfer of ownership of cable undertakings still be under the benefits test in light of that competition?
Answer is "no".
LISTNUM 1 \l 1629 Here we are 11 years later and we still have a benefits policy that applies to radio transactions and television transactions, albeit a different test in terms of the percentage of the transaction.
LISTNUM 1 \l 1630 We do not believe that the application of this benefits policy should be continued for the obvious reasons that those obligations are over and above the purchase price of any undertaking.
LISTNUM 1 \l 1631 We believe that they constitute a financial burden on the parties to the transaction that is unwarranted for the same public policy reasons that brought you to this conclusion here, and that is competition in the sector should be the prevailing trigger to bring the Commission to the same realization and the same conclusion it did in 1996 for cable transfers, and that is where there is competition, the benefits test should no longer apply.
LISTNUM 1 \l 1632 And as you know, Mr. Vice‑Chairman, it was introduced by two points or three points, it was eliminated and we are suggesting that its time has come here too.
LISTNUM 1 \l 1633 COMMISSIONER ARPIN: Now, if the Commission was to ‑‑ well, I am amazed by your proposal because we just heard or will be hearing very shortly, a total of four major transactions and none of the applicants have proposed there be no benefits test.
LISTNUM 1 \l 1634 To the contrary, they all came with a proposal that were within the framework that it was established and they are coming with very substantial amount of money and non challenged ‑‑ none of them has challenged the principle of the benefits test.
LISTNUM 1 \l 1635 MR. O'FARRELL: I believe that that's absolutely consistent, sir, on the basis that those applicants come forward and comply with the rules as they are written and expect you to apply them as they are written.
LISTNUM 1 \l 1636 COMMISSIONER ARPIN: So?
LISTNUM 1 \l 1637 MR. O'FARRELL: And seek your approval on transactions that they put before you based on those rules and to challenge the rules would be perhaps the wrong way to start the discussion about getting approval on the transaction.
‑‑‑ Rires / Laughter
LISTNUM 1 \l 1638 MR. O'FARRELL: It wouldn't be the advice I would give them if they were soliciting it from me.
LISTNUM 1 \l 1639 COMMISSIONER ARPIN: I guess your proposal is only prospective as well.
LISTNUM 1 \l 1640 MR. O'FARRELL: Well, the fact of the matter is that we think it's not a matter of personalities or challenge in positions, it's a matter of philosophical ground and public policy principle, which is if it was the principle that triggered the Commission to remove it and eliminate it from cable distribution undertakings transfers in 1996, that is there is competition, it surely shouldn't apply here any more.
LISTNUM 1 \l 1641 But I don't think that you will see applicants frankly coming forward in applications to seek your approval to transfer control, challenging it, because they are here seeking your approval and they must comply with the rules and conform to all of the policies and expectations to put the very best likelihood of that approval on their side.
LISTNUM 1 \l 1642 But here we are in this discussion on policy matters today and the question I think has its valid place. Whether or not you are convinced that competition is sufficient in the sector, we would hope you are, but certainly competition is there. It's not only the regulated competition, it's the unregulated competition.
LISTNUM 1 \l 1643 COMMISSIONER ARPIN: Thank you, Mr. O'Farrell.
LISTNUM 1 \l 1644 As you know, in its report, the CTF task force makes the case that there is still need for more financial for the CTF and made a recommendation that the Commission contemplates having the television broadcaster contribute part of their benefits towards the CTF.
LISTNUM 1 \l 1645 I don't know if you had a chance to canvass your members or if your members or the CAB has a position on that, but if you have something to volunteer as a comment, I think we surely welcome your comments.
LISTNUM 1 \l 1646 MR. O'FARRELL: Mr. Vice‑Chairman, we don't have a position per see though we respect the individual who chaired that task force for all of the noble efforts that were invested to bring about the right recommendations.
‑‑‑ Rire / Laughter
LISTNUM 1 \l 1647 MR. O'FARRELL: We don't have a point of view o that here today, but we do have a point of view on the benefits policy generally going forward and that it should be eliminated.
LISTNUM 1 \l 1648 THE CHAIRMAN: Let us stay on the topic. We are not on CTF here, so, please. And so, the question I think we should stay on the diversity. Have you any question, Michel?
LISTNUM 1 \l 1649 COMMISSIONER ARPIN: No. Those are my last, all my questions.
LISTNUM 1 \l 1650 THE CHAIRPERSON: Michel Morin?
LISTNUM 1 \l 1651 CONSEILLER MORIN: J'aimerais vous parler de votre code d'auto‑réglementation. Dans un premier temps, les journalistes ont été éliminés; je passe là‑dessus.
LISTNUM 1 \l 1652 Mais, dans un deuxième temps, dans la mesure où on fait ça dans une perspective d'auto‑réglementation de l'industrie, est‑ce que, éventuellement, au niveau des plaintes, et caetera, est‑ce que éventuellement, les journalistes, pour donner un peu plus de crédibilité d'une certaine façon à votre code et à son application au niveau des plaintes, est‑ce que, éventuellement, les journalistes pourraient être associés davantage à ce code‑là que l'industrie a mis sur pied?
LISTNUM 1 \l 1653 M. O'FARRELL: Merci, monsieur Morin. Je vous assure que les journalistes ont été impliqués directement ou indirectement dans le processus qui a mené à ce code.
LISTNUM 1 \l 1654 D'ailleurs, il y a eu plusieurs étapes d'un processus où je ne peux pas vous donner exactement où il y a eu des interventions singulières d'un journaliste ou d'une journaliste, mais où les syndicats sont intervenus et où il y a eu...
LISTNUM 1 \l 1655 Madame Bell a un détail complet de la démarche qui a été faite.
LISTNUM 1 \l 1656 Donc, je voudrais juste vous assurer qu'il y a eu, effectivement, beaucoup beaucoup beaucoup d'intervenants non pas seulement du secteur du journalisme tel quel, mais bien du secteur at large des personnes intéressées qui avaient un point de vue à faire valoir sur la chose.
LISTNUM 1 \l 1657 Donc, dores et déjà, la représentation du point de vue journalistique, nous sommes de l'avis qu'elle y ait en raison de cette démarche‑là.
LISTNUM 1 \l 1658 Charlotte, veux‑tu rajouter quelque chose?
LISTNUM 1 \l 1659 MME BELL: Bien, tout ce que j'ajouterais monsieur Morin, c'est que le code... en fait, le code qui est proposé dans ce processus ici, c'est vraiment... c'est le même code auquel on adhère déjà pour CTV et Global, qui fait partie des renouvellements de nos licences qui ont pris place en 2001.
LISTNUM 1 \l 1660 À ce moment‑là il y a eu un processus public incroyable. Il y a eu des centaines d'intervenants. Le National Newspaper Guild, je crois que c'est le nom de l'organisation, est intervenu et a comparu devant le Conseil, a proposé certaines recommandations. Il y a eu un processus complètement ouvert. Il y a eu des académiques de Carleton University, York University, qui sont venus aussi devant le Conseil, qui ont fait des propositions.
LISTNUM 1 \l 1661 Alors, il y a eu vraiment un processus très ouvert et très public; 69 intervenants sont comparus pendant ces audiences publiques là.
LISTNUM 1 \l 1662 Puis l'ironie de notre renouvellement en 2001, c'était que l'audience devait être pour renouveler nos licences puis on a passé la majorité du temps à discuter justement de ce code‑là.
LISTNUM 1 \l 1663 Alors, moi, je pense qu'il y a déjà eu un "input" comme on dit de ce côté‑là.
LISTNUM 1 \l 1664 CONSEILLER MORIN: Je m'en doutais bien, mais dans un deuxième temps, au niveau des plaintes et tout ça, est‑ce qu'il y a une place pour les journalistes?
LISTNUM 1 \l 1665 M. O'FARRELL: Dans la façon que le CCNR fonctionne ou accomplit son mandat, si ce n'est déjà suffisant, il y aurait sûrement moyen de regarder comment, effectivement, il y aurait une place peut‑être plus en vue.
LISTNUM 1 \l 1666 Il n'y a rien à exclure, mais je pense que ce qui est à retenir, c'est que la démarche que le Conseil a suivie jusqu'à présent, après bien des années, puis j'aimerais que monsieur Goldstein peut‑être revienne là‑dessus, c'est un processus qui a produit des résultats non seulement transparents, mais des résultats qui ont été pour la plupart, et puis je n'ai vraiment pas en mémoire une seule instance où il y a eu des récriminations ou des griefs qui ont été formulés par quiconque, et incluant les journalistes, suite à une décision du processus et du Conseil.
LISTNUM 1 \l 1667 Donc, je pense qu'il est juste de dire que le processus d'inclusion, jusqu'à présent, n'a pas été mis en jeu ou n'a pas été mis en doute par un quelconque groupe d'intervenants, à ce que je sache.
LISTNUM 1 \l 1668 David, veux‑tu rajouter?
LISTNUM 1 \l 1669 M. GOLDSTEIN: Monsieur Morin, si vous me permettez, en anglais.
LISTNUM 1 \l 1670 First of all, you will have the opportunity, I believe, the CBSC will come forward and you will have an opportunity to speak to them, but I think there were some issues that were raised about the arm's length nature of self‑regulation and we have seen in other very very touchy areas, whether it's sexual portrayal, language, violence, that the CBSC has demonstrated itself to be an extremely arm's length organization.
LISTNUM 1 \l 1671 I think we were all quite ‑‑ my colleagues and I were all quite stunned by how many times they rule against broadcasters on a regular basis, but I think they have shown their independence in the past and I think there is a great deal of ability for journalists and members of the public, viewers, listeners and readers to have their input as well.
LISTNUM 1 \l 1672 CONSEILLER MORIN: Mais, monsieur O'Farrell, je pense que vous venez d'ouvrir la porte en fait. Peut‑être que, éventuellement du point de vue formel, il pourrait y avoir quelque chose un peu à l'exemple, du Conseil de presse, par exemple, au Québec?
LISTNUM 1 \l 1673 M. O'FARRELL: Je ne dirais pas que je voudrais ouvrir la porte ou vous laisser avec l'impression que le modèle du Conseil de presse nous attire particulièrement et ce n'est pas parce que je veux mettre en jeu la crédibilité du Conseil de presse, mais plutôt pour dire que nous avons un organisme qui, lui, a non seulement gagné ses titres de créance, l'a fait d'une façon qui est adaptée au système de radiodiffusion canadien parce que c'est dans ce secteur‑là qu'il habite et qu'il fonctionne depuis sa création.
LISTNUM 1 \l 1674 Donc, je veux vous dire qu'on n'est pas ici, comme disait monsieur Gauthier, le CCNR comparaîtra lui‑même et il aura ses propres commentaires et explications à vous formuler.
LISTNUM 1 \l 1675 Mais j'insiste sur le fait qu'il faut reconnaître que jusqu'à présent, et si je me trompe là‑dessus qu'on me corrige, mais je ne pense pas qu'il y ait eu une seule instance ou une décision où le processus qui a mené à la décision du Conseil, a été reproché par quiconque, provenant d'un quelconque groupe d'intérêt, y compris les journalistes.
LISTNUM 1 \l 1676 Donc, sur la base de ce track record‑là, je me dis, il y a quand même du bon à retenir.
LISTNUM 1 \l 1677 THE CHAIRPERSON: Okay. Thank you. I think that will conclude. I just want to make sure I did understand you correctly.
LISTNUM 1 \l 1678 You said several times we are suffering from a surplus of diversity. Now, you are using those terms somewhat interchangeably. We have talked about plurality, purely plurality, and by plurality we mean professional editorial voices.
LISTNUM 1 \l 1679 Are you also suffering from a surplus of plurality?
LISTNUM 1 \l 1680 MR. O'FARRELL: We are celebrating the surplus of diversity and the surplus of plurality. We are not suggesting that we should shut anybody down.
LISTNUM 1 \l 1681 THE CHAIRPERSON: No, no, no. But you feel ‑‑ sorry, I didn't mean to imply that ‑‑ you mean, we have a surplus of plurality as well as a surplus of diversity in this country?
LISTNUM 1 \l 1682 MR. O'FARRELL: In the broadest sense of the media landscape today, absolutely.
LISTNUM 1 \l 1683 THE CHAIRPERSON: Okay. Thank you. We will take a 15 minute break. Thank you.
‑‑‑ Suspension at 1117 / Suspension à 1117
‑‑‑ Upon resuming at 11:32 a.m.
LISTNUM 1 \l 1684 THE CHAIRPERSON: Madam Boulet.
LISTNUM 1 \l 1685 THE SECRETARY: I would ask if you could please take your seat, we are about ready to start.
LISTNUM 1 \l 1686 THE CHAIRPERSON: Madam Boulet, who is next?
LISTNUM 1 \l 1687 THE SECRETARY: Thank you, Mr. Chairman.
LISTNUM 1 \l 1688 I would now call on the next intervener, CTVglobemedia.
LISTNUM 1 \l 1689 Excuse me, we are ready to start. Thank you.
LISTNUM 1 \l 1690 Mr. Rick Brace will be appearing on behalf of CTVglobemedia. Mr. Brace, if you could introduce your panel, and you will have 10 minutes for your presentation. Please go ahead.
INTERVENTION
LISTNUM 1 \l 1691 MR. BRACE: Thank you. Mr. Chair, members of the Commission, Commission staff, my name is Rick Brace and I am the President of CTV.
LISTNUM 1 \l 1692 Before we begin, I would like to take this opportunity to introduce our panel. On the far right, to your left, is Robert Hurst, President of CTV News; to Robert's left is Sarah Crawford, Vice‑President, Public Affairs, CTVglobemedia; seated beside Sarah is Paul Ski, President of CTVglobemedia's radio division; on my left is Kevin Goldstein, CTVglobemedia's Senior Director of Regulatory Affairs; seated beside Kevin is Paul Sparkes, Senior Vice‑President of Corporate Affairs for CTVglobemedia; and on the end is Richard Gray, Head of A‑Channel News.
LISTNUM 1 \l 1693 Thank you for the opportunity to appear before you at this hearing. At the outset we would like to note that we played an active role in the development of the CAB's position in this proceeding and we generally support their submission.
LISTNUM 1 \l 1694 At CTV we are aware of how difficult it has been to build a distinct and truly diverse Canadian broadcasting system. Given our geography, demography, linguistic and cultural diversity and physical proximity to the cultural behemoth that is the United States it is clear that market forces alone would not have created this system.
LISTNUM 1 \l 1695 The Canadian broadcasting system, which is envied internationally, exists because of the marriage between private investment and smart public policy. Today, Canadians have access to an incredibly wide range or programming choices, both from home and abroad, regardless of where they live.
LISTNUM 1 \l 1696 However, the media universe is changing and changing rapidly. Over the last 20 years we have watched specialty television grow dramatically while conventional television, once the primary choice for Canadians, is now a sector in decline.
LISTNUM 1 \l 1697 Today, Canadian listeners have access to a greater number of radio stations and formats than ever before. Furthermore, the emergence of the internet and other developing platforms, which are unregulated and do not respect our boarders have forced traditional broadcasters to re‑examine their existing business models, which bring us to this hearing.
LISTNUM 1 \l 1698 In the last 14 months four significant transactions have been announced in the broadcasting sector. These transactions are a clear manifestation of a global trend toward consolidation brought on by the sweeping changes affecting the media industry. In light of this wave of consolidation the Commission announced that it would conduct this proceeding to consider a variety of issues relating to the diversity of voices in Canada. Furthermore, the Commission indicated that it intended to specifically focus on three issues with each appearing intervener in this proceeding.
LISTNUM 1 \l 1699 The first issue relates to the plurality of commercial editorial voices available in the local and national markets. As noted in the Broadcasting Act, the Canadian broadcasting system is a single system comprised of public, private and community elements. Each of these components, including CBC, educational broadcasters such as TVO and community‑based media, play an essential role in ensuring that a plurality of editorial voices are available to Canadians and any examination of editorial diversity must take this into consideration.
LISTNUM 1 \l 1700 With respect to your question, we do believe that Canadians currently have access to a diverse range of Canadian editorial voices, both at the local and the national level, and the number of voices is increasing. In fact, on a daily basis most Canadians have access to a local news from at least three and sometimes more over‑the‑air television stations and an even greater number of local radio stations and one, if not two or more, local newspapers.
LISTNUM 1 \l 1701 Moreover, they have access to foreign national newscasts on television, five speciality services that focus entirely on news and public affairs programming and countless other print and electronic sources for national news. And this is only a summary of Canadian editorial voices. There are multiple other non‑Canadian sources available. In fact, it is interesting to note that there are only four national newscasts in the United States, the same number as in Canada, despite the fact that their population is nine times our size.
LISTNUM 1 \l 1702 Looking at a specific Canadian market helps put this into perspective, take the Edmonton market as an example. In 1970 there were 12 local English‑language broadcasting options, by 2000 this number was 22 and today it is 27. In fact, in total there are 111 Canadian English‑language broadcasting choices available to Edmontonians.
LISTNUM 1 \l 1703 Certain participants in this proceeding have tried to argue the consolidation of ownership lessens diversity. In fact, consolidation of ownership can actually result in increased diversity. For example, the consolidation of ownership that has occurred in radio since the ownership limits were changed nearly a decade ago has helped to revitalize the radio industry. This, in turn, has meant that more resources can be devoted to certain formats such as news or talk radio on AM that may not be viable as a standalone operation or even as part of an AM/FM combination.
LISTNUM 1 \l 1704 In addition, we have an economic incentive to make the programming provided by our different services appeal to different tastes. Providing more of the same to the same viewers or listeners dilutes the audience. Simply put, homogenization destroys value.
LISTNUM 1 \l 1705 The second issue the Commission indicated it wanted to discuss was the diversity of programming choices offered to Canadians. We believe that Canadians have an incredibly diverse array of programming choices available to them. The growth of speciality television has resulted in an exponential increase in the amount of programming that is being produced in many genres. Furthermore, the changes to radio ownership rules a decade ago have actually increased the range of niche formats available.
LISTNUM 1 \l 1706 The Commission's policies have resulted in a good balance between the amount of Canadian and foreign programming that is available. Furthermore, the policies in place relating to Canadian programming and the flexibility given broadcasters have resulted in a production of high‑quality Canadian programming that most importantly appeals to Canadians.
LISTNUM 1 \l 1707 In this regard, CTV has been the leader. We have used our scale to further the objectives of the Act by creating top‑rated English‑language Canadian programs in virtually every genre. We don't believe that there is a problem with respect to programming diversity in this country and we are not aware of any evidence to support such a viewpoint.
LISTNUM 1 \l 1708 The third and final area that the Commission stated it wanted to canvass was the effectiveness of existing and proposed safeguards with respect to journalistic content in cross‑media ownership situations. Our view on this issue is relative straightforward. We believe the measures in place are very effective.
LISTNUM 1 \l 1709 The CTVglobemedia's statement of principles and practices, which was first introduced in 2001 and extended twice since then, has ensured editorial diversity. In practice, it is the editors, writers and journalists who play the central role in setting a station's editorial direction by maintaining editorial independence between our groupings of assets through separate management and presentation structures. By this, we ensure that distinct voices continue to be available. Moreover, since implementing our statement of principles we have had no complaints.
LISTNUM 1 \l 1710 With the safeguards we have agreed to and implemented relating to programming overlap and the proposed CBSC journalistic independence code, which we have supported, we have a multi‑pronged approach to dealing with any perceived problem relating to cross‑media ownership.
LISTNUM 1 \l 1711 We recognize that periodic regulatory reviews of this nature are both essential and valuable. As we noted in our written submission and our presentation today, we believe that the policies currently in place to encourage the existence of a diversity of voices have been successful. In fact, no participant has provided evidence to prove otherwise.
LISTNUM 1 \l 1712 At CTV we are strong supporters of the Canadian broadcasting system, a system that from the beginning has succeeded against the odds. It is essential that we have a regulatory framework that allows us to build in this success.
LISTNUM 1 \l 1713 We thank you for your time and welcome your questions.
LISTNUM 1 \l 1714 THE CHAIRPERSON: Thank you very much.
LISTNUM 1 \l 1715 You were here this morning when the CBC made their presentation and you heard them basically saying the same thing as you and the CAB, that there is no issue in the Canadian system. But the CBC went one step further and said, we have to be prospective and I think that is a very good point. We do have to be prospective.
LISTNUM 1 \l 1716 We are not only taking a snapshot of what is today, but we are worried about the future. And they sort of suggested three very simple rules, one of them was no owner should have two out of three in any market. And the two out of the three that they are talking about is television, radio and newspapers. The second one is no owner should no owner should have more than 33 per cent of specialty. And the third one, no owner should have more than two BDUs in any market.
LISTNUM 1 \l 1717 They felt that prospectively going forward, even if somebody is offside those rules right now, they would ensure that the state of the market that we have now would stay in place.
LISTNUM 1 \l 1718 Would you care to comment on that?
LISTNUM 1 \l 1719 MR. BRACE: I would like to make a couple of comments on that, Mr. Chair.
LISTNUM 1 \l 1720 Firstly, we believe that what we have seen historically and what we continue to see is a growth in diversity. And by the way, we don't fully support the notion of the surplus in diversity, we don't think there can be enough diversity. We think that that is something that should continue to grow. So that is number one. We are seeing that increasing on a regular basis. And we examined that, certainly through Edmonton, across many markets that we can talk about if you like.
LISTNUM 1 \l 1721 Number two, I would say that it oversimplifies the situation to simply say that we impose these rules without considering whether or not what is currently in place is working and we believe it is. The safeguards that exist in the consolidated world, the safe guards that we have in place in terms of the plurality of editorial voices are all, I think, working effectively.
LISTNUM 1 \l 1722 The last point I would like to make on that is that we don't see barriers to entry. That, you know, in point of fact with Category 2, speciality licences, it seems that there is an opportunity for new entrants to come into the market as well. And as such, we think that the system is in fact working. And to arbitrarily impose ‑‑ and it was arbitrary, I mean, it was 33 per cent, it was 25 per cent, there really wasn't a defined number, it was just some number that needed to be determined ‑‑ really doesn't hit the point.
LISTNUM 1 \l 1723 So we would oppose that.
LISTNUM 1 \l 1724 THE CHAIRPERSON: Okay. Thank you very much.
LISTNUM 1 \l 1725 Stuart, I believe you have some questions.
LISTNUM 1 \l 1726 COMMISSIONER LANGFORD: Thank you, Mr. Chairman.
LISTNUM 1 \l 1727 Thanks for your presentation this morning. I am glad you don't want to oversimplify things, Mr. Brace, because up until now I suspect maybe you have. At least, I have understood it to be an overly simplified approach and that essentially is just let it rip seems to be your approach, because everything is fine. And there is perhaps not a surplus of voices you say, because there never can be enough, but there certainly are many voices today and you point to the Edmonton market and the overall number of voices available, but what bothers me about your approach is you don't seem to weigh the voices.
LISTNUM 1 \l 1728 Is your approach so simple that you take all voices to be equal, whether you are a Category 2 or a seasoned over‑the‑air broadcaster like CTV or whether you are a blog or whether you are a speciality news channel? Are they all equal voices when we are looking at diversity?
LISTNUM 1 \l 1729 MR. BRACE: No, that would be oversimplifying it, but the issue with trying to put a pin in that, to trying to focus on that and establish a weighting system is that we live in such a dynamic environment, and so what may be true today may not be true tomorrow.
LISTNUM 1 \l 1730 I would use the example of specialty television, and the rapid increase in viewership that it's enjoyed over the last few years, as compared to what's happened in the conventional side of the equation. So that, you know, establishing a weighting would have to be an ongoing process. It would have to be something that's monitored.
LISTNUM 1 \l 1731 I mean, in the dynamic world we live in, and looking at it from a holistic approach, which would take into account not just commercial television, but private television ‑‑ or public television, rather, community television, beyond that the foreign services that are coming in, and even beyond that the new media platforms, the dynamics at play make it very difficult to establish kind of a focused way of putting a pin in it, as I say, especially when it's changing so rapidly.
LISTNUM 1 \l 1732 That's why I think that rather than saying, "Okay, here are the rules of the road", because I think they're going to be changed by tomorrow or will need to be changed by tomorrow, that what works better is to take inventory of where we are today, look across our system, and do the research, establish whether or not, number one, we believe there's diversity existing, whether it's growing, and what complaints are we receiving, what feedback are we getting, and do that on a regular basis to determine where we need to go down the road. That would be the more effective approach, I believe.
LISTNUM 1 \l 1733 COMMISSIONER LANGFORD: But when you take inventory, do you not weigh the value of the inventory? Even in your own shop you have got a newspaper, plus one of your owners has got a hunk of another newspaper, so that gives you a piece of the Toronto Star, as well as all of the Globe and Mail, I suppose, some influence there anyway, you have got two over‑the‑air networks, you have got lots of specialities, you have got radio now, commercial radio.
LISTNUM 1 \l 1734 Before we just step back and say, "My goodness, that's a lot", do you count them all equally? Are all of them of equal influence when it comes to the impact of their voices on the Canadian public?
LISTNUM 1 \l 1735 MR. BRACE: I wouldn't say we are naive enough to say that we count them all equally, Commissioner. What I would say, that it's a moving target, and that's the issue. To put a pin in it today, to kind of define it, to kind of set a value to it is extremely difficult because, as we know, policies get put into place, rules of the road stand for a fairly long length of time, and I just worry that, in the environment that we live in and as rapidly as it's changing, it would be hobbling as we move down the road. I mean, how do we continually revisit that and make sure that it's up to date, that's the issue.
LISTNUM 1 \l 1736 COMMISSIONER LANGFORD: But isn't there some place where even you would say, and even the CAB would say, "Well, there's got to be a point beyond which we won't go". I mean, is that where we start, then? If you want to count everything equally, not put a pin in it, as you say, not weigh anything, not evaluate and assess as to impact, and you want to just look at the full package, where does the full package get to big?
LISTNUM 1 \l 1737 We are down to three, perhaps four over‑the‑air broadcasters in television, to use that example. So if that reduces to three or two or one, where do the hairs on the back of your neck begin to send you danger signals?
LISTNUM 1 \l 1738 MR. BRACE: I don't have an answer for that, other than to say that it's when we start to recognize, when people start to raise the issues, when the red flags start to be raised.
LISTNUM 1 \l 1739 Someone this morning, I think used an example of what if, you know, the vast majority of radio and television, and potentially newspapers, were owned by one owner? That's one end of the scale, and, you know, that probably is not a good thing. Conversely, at the other end of the scale, is everything is independently owned.
LISTNUM 1 \l 1740 Well, we know that in the environment we live in it's going to take strong, and is taking strong consolidated companies to compete with the marketplace because we are no longer just competing domestically.
LISTNUM 1 \l 1741 So, you know, it is very hard to determine that. I wish that we could. I wish that I could give you an answer that said, "Yeah, here's the formula that could work", but I don't know how we establish it, quite frankly.
LISTNUM 1 \l 1742 What I would say is that one of the good benchmarks for us is looking now, taking a snapshot in time and saying what currently exists, what are the problems? And is there a problem, because the premise of where we started is we are not really seeing the problem, so we don't know what to fix.
LISTNUM 1 \l 1743 COMMISSIONER LANGFORD: Well, let me give you some problems, as I see them.
LISTNUM 1 \l 1744 In commercial radio, personally, I don't speak for the Commission, I would say the quality of news is appalling on commercial radio in Canada. It's almost nonexistent. And to add it up by numbers is one thing, but to look at the quality of it, in my view, it's shocking. So that's one statement.
LISTNUM 1 \l 1745 Let me make another statement, that we have no guarantee under our present over‑the‑air television policy that there will continue to be news of any sort because the last time around we accepted the position of intervenors such as yourself, and others, that news, particularly at the local level, on television, was such a good competitive edge that no thinking broadcaster would ever give up on it, and yet we know for a fact that City did give up on the traditional view of local news, as we have known it, for years: the 6 o'clock newscast, the 11 o'clock newscast, locally.
LISTNUM 1 \l 1746 So that happened. We know that almost simultaneously with the announcement that CTV would purchase CHUM, 280 journalists and people working in journalism in the CHUM enterprise were given their notice. So it looks like we may have been wrong in our 1999 policy.
LISTNUM 1 \l 1747 And for you to say, "Wait for a problem" would be cold comfort, I would think, to those 280 journalists, would be cold comfort, perhaps, to people listening to commercial radio hoping to get some news, some real news, and might be, by the time we saw the real problem you are looking at, cold comfort right across the board.
LISTNUM 1 \l 1748 So I come back to my statement: surely it isn't enough for you today to enjoy the use of the amount of public spectrum your company enjoys, and that the CAB, of which you are a member, enjoys overall, all the CAB members, with absolutely no guarantees that at a certain point, if diversity of voices started to be a problem, some kind of policy wouldn't click in to protect Canadians.
LISTNUM 1 \l 1749 I'm sorry to be so long in the asking, but those are the sorts of problems I think I can identify and how do you respond to that? Surely, we want to operate and act before we have a calamity on our hands, not when we have got a calamity.
LISTNUM 1 \l 1750 MR. BRACE: I think what I would say to that, Commissioner, is that we have some of those remedies in place. They are the safeguards that exist within our licences, our statement of principles that we abide by, that ensure, I think, editorial independence and diversity.
LISTNUM 1 \l 1751 You know, plurality of editorial voices doesn't necessarily mean it's going to be make better news. It doesn't necessarily mean the product is going to be better. I mean, what we would argue is that, through consolidation and the building of strong companies, we have a better chance of making that product better.
LISTNUM 1 \l 1752 In the radio example, you know, with the direction we have gone and our ability now to provide resources to Paul Ski, who runs the radio division, I think that, you know, we can give some examples of where that is actually going to be an opportunity to improve where we are going.
LISTNUM 1 \l 1753 Similarly, in news, with the A Channels, once again with the resources. In fact, I would like to have these folks comment on that because it may be beneficial to hear, in practice, what's happening and why we believe that the consolidation that we have seen happen here is actually improving the product and it may be addressing some of what you are talking about.
LISTNUM 1 \l 1754 Maybe we will start with Paul.
LISTNUM 1 \l 1755 MR. SKI: Thanks, Rick.
LISTNUM 1 \l 1756 Commissioner Langford, I think just a couple of things.
LISTNUM 1 \l 1757 One, the Canadian public has more news choices on radio than every before. I think your comment was the quality of the news on radio is quite shocking. Respectfully, I disagree with that.
LISTNUM 1 \l 1758 COMMISSIONER LANGFORD: I'm not surprised, Mr. Ski.
LISTNUM 1 \l 1759 MR. SKI: Well, yes. I think what we have to look at is that there are more news choices now than there have ever been before, but also different radio stations provide different types of information and different types of news depending on the particular demographic that they are trying to reach. So what might be quality news to you, may not be quality news to someone else.
LISTNUM 1 \l 1760 People have moved away from radio as a primary news source. It was a primary news source at one time, it isn't so much any more. For some people, who listen to three or four stations, they will listen to a station that plays all news, then go to a station that plays music. So there's quite a bit of diversity, in terms of what they listen to. The average person listens to 2.5 stations. But what we are trying to do is appeal to different types of information, desires and needs from the listening public.
LISTNUM 1 \l 1761 COMMISSIONER LANGFORD: But, surely, if we can stick with radio for a moment, and I know that when I get into quality I somewhat cross the line, and I can see my chair's ample eyebrows quivering slighting, and I'm not insensitive to that, but still quality has to be part of the test.
LISTNUM 1 \l 1762 As I said, it doesn't seem logical to me to say just because there are bloggers out there, to take another example, we can drop our news. And it doesn't seem quite enough to me, Mr. Ski, to say, "Well, different news for different folks, you know. We have got young people listening to our radio, so the news for them is, you know, what are the movie stars wearing this month". That's not going to do much for them if world war three is declared that day.
LISTNUM 1 \l 1763 I mean, I take your point, it's something of a moveable feast, but at the same time you got some pretty nice properties there and the public has a huge interest in them. Other than giving back to the public the kind of music they want, don't you feel that in the sense of a diversity of voices we should be able to ask for more?
LISTNUM 1 \l 1764 MR. SKI: Well...
LISTNUM 1 \l 1765 COMMISSIONER LANGFORD: Because information counts.
LISTNUM 1 \l 1766 MR. SKI: Of course, it does, and all of our stations have a certain spoken word/information component. But as I said, different people want different things. I'm quite proud of what we have accomplished. Our radio stations have won awards for the quality of their news over and over and over again. So, obviously, somebody believes that there's quality there and that's what makes the hairs on the back of my neck stand up, because I, quite frankly, think we are doing a very good job.
LISTNUM 1 \l 1767 MR. BRACE: And I guess just before I pass it along to Richard for a comment on just what's happening with the A Channels, which you may find of interest in respect to how they are using CTV as a resource, I guess, Commissioner, you know, we endeavour to give not people what we think they should, but what they want and what they respond to. That is why we have different formats, it's why we schedule differently.
LISTNUM 1 \l 1768 I would say it's no less true in news. I'm not from the news department, I don't have any editorial jurisdiction over the news, but it seems to me to be the direction that you would want to go.
LISTNUM 1 \l 1769 Maybe I will pass it along to Richard just for a comment.
LISTNUM 1 \l 1770 MR. GRAY: Thanks, Rick.
LISTNUM 1 \l 1771 The really important thing with respect to the A Channel's move into CTVglobemedia, in terms of improvement of the news product, has to do with now our ability to access far greater national and international resources.
LISTNUM 1 \l 1772 You know, under CHUM these television stations, if a national story happened in Saskatchewan, if a national story happened in Quebec, if a national story happened in the maritimes, we either couldn't get access to interviews, we couldn't get access to video from those stories or it was extraordinarily costly for us to go out and acquire that material.
LISTNUM 1 \l 1773 Now, by virtue of the fact that we are part of a much bigger empire, we are able to access that material and provide those stories to our viewers in a unique way, in a way that is different in every local market that we are in.
LISTNUM 1 \l 1774 The same thing holds true with respect to international news, and I'm going to use Afghanistan as an example. In the past, you know, when we have seen the unfortunate death of a Canadian soldier in Afghanistan, we never had the ability to get video, we never had the ability to get interviews from Afghanistan of soldiers who served alongside of that dead soldier.
LISTNUM 1 \l 1775 What we had to do to tell that story to our local audience was to take a photo off the Department of National Defence web site and create a graphic, and that's how that story was told. Now, we can tell that story much more effectively to viewers on Vancouver Island, to viewers in Barrie, in London, in Windsor, in Wingham, in Pembroke, in Brandon, Manitoba, because of that access that we now have.
LISTNUM 1 \l 1776 COMMISSIONER LANGFORD: But if I could stop you there, that's the good side of it, and I understand that, with growth comes synergies, come access to resources. But isn't the other side of what you are telling me that the A Channel is now giving the same news as CTV?
LISTNUM 1 \l 1777 MR. GRAY: No, I think the really important point to make is that we are not devoting any more time in our newscast to those stories, we are just telling them more effectively. What we are still doing on the A Channel stations is separate local newscast for separate local markets. The only market where we have got two stations, a CTV station and an A Channel station, is in Ottawa, and those stations are very distinctly different.
LISTNUM 1 \l 1778 COMMISSIONER LANGFORD: But if they were owned by different people, just pushing this forward a bit, different owners, so that you were denied access to the CTV film library, CTV assets, all the goodies that you have now got access to, and I don't in any way minimize the importance of these things, but if there were different owners, separate owners, wouldn't you get these stories told from different perspectives, with different resources? Wouldn't that make available to Canadians two different slants on a story?
LISTNUM 1 \l 1779 If we take something more complicated, not more important, but more complicated than a death in Afghanistan, some big public policy initiative, say, the budget or something, which people want to look at, want to know what's going to happen to their tax base and what not, isn't it helpful to have different experts, different expertise coming at these stories, different viewpoints, different editorial approaches?
LISTNUM 1 \l 1780 MR. GRAY: It is ‑‑
LISTNUM 1 \l 1781 COMMISSIONER LANGFORD: All right.
LISTNUM 1 \l 1782 MR. GRAY: ‑‑ and that does happen. Those differences don't flow from ownership, they flow from the journalists, themselves. They flow from the reports in a newsroom, they flow from the producers in a newsroom, they flow from the news directors who are operating these systems.
LISTNUM 1 \l 1783 Take the provincial election example in Ontario. We, on the A Channel stations, are going to produce radically different election‑night broadcasts than the CTV stations are. We are going to interview different experts, we are going to cover different ridings, we are going to cover different candidates, we are going to cover different issues because we are in different markets. It doesn't flow from ownership.
LISTNUM 1 \l 1784 COMMISSIONER LANGFORD: That's Ontario. What about nationally, though? What will happen nationally at the next national election?
LISTNUM 1 \l 1785 MR. GRAY: Well, the next national election, A Channel will use its resources, in terms of on‑air presence, to cover that show the same way that we will the provincial election. You know, we will cover the national election in Victoria and on Vancouver Island from a very different perspective and in a very different way than CTV will in Kitchener or CTV will in Montreal.
LISTNUM 1 \l 1786 COMMISSIONER LANGFORD: And when Mr. Harper gives a major speech in Saskatoon, say, or in Toronto or in Quebec City, will you have an A Channel camera there and an A Channel reporter and a CTV camera there and a CTV reporter?
LISTNUM 1 \l 1787 MR. GRAY: Not in Saskatoon, necessarily, but what will happen ‑‑ and in cases where we won't, what will happen to that material is that the play and the prominence and the interpretation of that particular story is going to be presented by, you know, the folks who are in individual newsrooms.
LISTNUM 1 \l 1788 So the news director in Victoria, the news director in Barrie, the news director in London, along with their associated producers and their associated presenters, will interpret that story, will present that story about Mr. Harper's announcement in Saskatoon in a way that is specifically targeted, specifically geared to their particular audience.
LISTNUM 1 \l 1789 COMMISSIONER LANGFORD: And if the story is some announcement which has a huge impact on such entrepreneurs as the Thompson family, the Toronto Star, pension funds of some sort of another, how do we guarantee that the message they prefer doesn't spread through from CTV and the Globe and Mail and the Toronto Star to the radio stations and to the A Channel?
LISTNUM 1 \l 1790 MR. HURST: Can I pick up on this one?
LISTNUM 1 \l 1791 MR. GRAY: Sure.
LISTNUM 1 \l 1792 MR. HURST: Because ‑‑
LISTNUM 1 \l 1793 COMMISSIONER LANGFORD: I think he'd be grateful if you did, actually.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 1794 MR. HURST: Let me answer that question first, because it's a critical question and it's an important question, and it's a question that has been around since journalism began.
LISTNUM 1 \l 1795 We have in place at CTV and across our various groups, including the Globe and Mail and the A Channel, absolute policies in place that say you treat reporting about your owners in exactly the same way that you will report on any other third party. You are to be careful and factual and make sure that individual, be it the owner or an affiliated company, is treated and given the exact right to respond as any third party.
LISTNUM 1 \l 1796 This is written down in our own policies and manuals internally and it is also backed up by the various codes that we, as broadcasters, stand by, the RTNDA Code of Ethics and the CAB Code of Ethics.
LISTNUM 1 \l 1797 But I don't want to ‑‑ and it's a very good question and it's a question that should be asked continually and repeatedly of private and public broadcasters because of all the pressure we get. Most of the pressure we get comes from politicians.
LISTNUM 1 \l 1798 THE CHAIRPERSON: So when it comes to covering the story, "Mr. Harper went here, Mr. Harper when there, Mr. Dion when here, Mr. Dion went there" ‑‑ I take your point, you have got your codes, you have got your standards, and I assume you have got your remedies should any of your journalists or assignment editors or whatever break them ‑‑ what happens when we get to that key time close to elections, where particularly commercial news voices make a decision and make an editorial decision as to which way they are going to go, what kind of freedom exits there?
LISTNUM 1 \l 1799 MR. HURST: You mean commercial news voices making an editorial?
LISTNUM 1 \l 1800 COMMISSIONER LANGFORD: Well, ultimately, the Globe and Mail supports one party or another, as does every newspaper.
LISTNUM 1 \l 1801 MR. HURST: This is a very easy answer because ‑‑
LISTNUM 1 \l 1802 COMMISSIONER LANGFORD: Ultimately, CTV will support one party or another or a ‑‑
LISTNUM 1 \l 1803 MR. HURST: Never, never.
LISTNUM 1 \l 1804 COMMISSIONER LANGFORD: Well, in my day, you could usually tell from the way Bruce Phillips' eyebrows were going which way you guys were going, but maybe you have got better eyebrow protection there now.
LISTNUM 1 \l 1805 MR. HURST: Well, I would tell you that at CTV we have no editorials. On our local, on our newsnet or our national news, there are no editorials. We banned these a fair time ago, for a whole bunch of reasons: they were counterproductive, nobody really cared in the voting booth what CTV thought.
LISTNUM 1 \l 1806 And when it comes to the Globe and Mail, whatever the Globe and Mail does is up to the Glove and Mail. We, at CTV News and at the A Channel, have absolutely nothing to do with the management or the editorial position or what is written in the editorial pages of the Globe and Mail.
LISTNUM 1 \l 1807 COMMISSIONER LANGFORD: So you are telling me, then, you are sticking with your position that there's at no point a time where you can see control mechanisms coming from a body like this, or some other regulatory body, that would be necessary with regard to amount of ownership, cross‑media ownership or even kind of a sense of a lack of diversity of voices, in the sense of how those voices are weighed, the impact that they have?
LISTNUM 1 \l 1808 MR. HURST: I'm the news guy, I cover the news, we chase the news. When it comes to statistics and ownership questions, it's over to Rick.
LISTNUM 1 \l 1809 MR. BRACE: I would say, Commissioner, that provided we stick to the Statement of Principles and provided we subscribe and adhere to the CBSC Code, when accepted and as proposed, that will be our measure, that if there are issues arising from that then we need to review it. But our intent at this point in time, and our direction, is to maintain the heart of what those codes say, and we think that they work.
LISTNUM 1 \l 1810 COMMISSIONER LANGFORD: One last question on another subject. It wasn't clear to me reading your thing, although I may have missed a clear statement reading your submission, are you also a supporter of the CAB's position on benefits, on phasing out, wiping out benefits?
LISTNUM 1 \l 1811 MR. BRACE: What we believe on benefits, Commissioner, is that we need ‑‑ I know we always smile when we say this ‑‑ the level playing field. We feel that it should be, you know, across the system, that we are kind of singled out at this point in time. So to the extent that the CAB has put forward that proposal, yes, we feel that would be the approach to take.
LISTNUM 1 \l 1812 COMMISSIONER LANGFORD: And would I be wrong, then, in suggesting if you are in favour of level playing fields that you would be then willing to donate 5 per cent of your gross revenues on an annual basis to the CTF, as the BDUs are now doing?
LISTNUM 1 \l 1813 MR. BRACE: I would say that any discussion down that road is something that we would want to reserve for licence renewal or for a future hearing. I don't think that we have totally formulated our position and I'm not ‑‑
LISTNUM 1 \l 1814 COMMISSIONER LANGFORD: So, essentially, your idea of a level playing field is: let us out of benefits, but keep the BDUs strapped to the 5 per cent contribution to Canadian production?
LISTNUM 1 \l 1815 MR. BRACE: No, I wouldn't suggest that at all. I think that what we need to do is formulate our opinion and either do it in reply or at a more appropriate hearing that we would view more appropriate, like a licence renewal.
LISTNUM 1 \l 1816 THE CHAIRPERSON: You will get the chance when we have a CTF hearing to ‑‑
LISTNUM 1 \l 1817 MR. BRACE: Exactly.
LISTNUM 1 \l 1818 THE CHAIRPERSON: ‑‑ formulate your decision.
LISTNUM 1 \l 1819 COMMISSIONER LANGFORD: It's a problem with compartmentalizing the way we do sometimes and it makes it difficult for us to practice our cross‑process ownership, if I can key a phrase.
LISTNUM 1 \l 1820 Thank you very much. Those are my questions, Mr. Chair.
LISTNUM 1 \l 1821 THE CHAIRPERSON: I just want to go back to your answer, because I don't quite accept that ownership has no effect at all on newscasts.
LISTNUM 1 \l 1822 Several submissions suggest there's such a thing as self‑censorship by journalists, and you are partially owned by the Globe, so if there's a big story about the Globe, let's say, negatively, et cetera, to what extent will the common ownership have an effect on the newscast? Hopefully now, as you suggest, you know, it is just looked at as any other company because that's the thing, but several of the submissions suggested, unfortunately, that's Polyannish. Reporters do know who their owner is and there will be a certain self‑censorship, and the only way to get around that is to have diverse ownership. If one of you would care to comment on that.
LISTNUM 1 \l 1823 MR. HURST: I would say the question about self‑censorship is similar to the question about what pressures you are from your commercial owners. It has been around since the beginning of journalism. It is a daily fact, you know.
LISTNUM 1 \l 1824 We don't report the truth, we try to report the facts from the background of which we have come to this position, so any of these questions about self‑censorship are valid. But when we are approaching a story, reporting on ourselves or reporting on the Globe and Mail, we never get any instruction from the CTV owners about anything we do. And your question might be: well, are there hidden pressures?
LISTNUM 1 \l 1825 THE CHAIRPERSON: It was purely talking about self‑censorship, I was not talking about pressures.
LISTNUM 1 \l 1826 MR. HURST: Right. There's no direct pressure, no indirect pressure and, I would even suggest that, when we are reporting on ourselves, we at CTV News go out of the way on reporting on ourselves so the appearance of any self‑censorship is erased, if at all possible.
LISTNUM 1 \l 1827 And I can tell you I don't think we have really done any major investigation of the Globe and Mail, but we have reported extensively on the Bell billing problems a few years ago, and just last Thursday our Edmonton station did a tough consumer story on a billing screw‑up with a Bell ExpressVu customer.
LISTNUM 1 \l 1828 I'm not sure if I have answered your question, sir.
LISTNUM 1 \l 1829 THE CHAIRPERSON: So if I understand you correctly, you are saying self‑censorship obviously may exist, it's a fact of life, but you are doing everything, in terms of your company's policies, to ensure there's no self‑censorship vis‑à‑vis your owners?
LISTNUM 1 \l 1830 MR. HURST: That's correct.
LISTNUM 1 \l 1831 MR. BRACE: And that is the policy of senior management, Mr. Chair.
LISTNUM 1 \l 1832 THE CHAIRPERSON: Yes, but, I mean, the submissions which we have, and you will hear them as we go through the weeks, suggests that's fine and that's how it should be, but, unfortunately, the will only guarantee that you have that you don't have self‑censorship is through separate ownership.
LISTNUM 1 \l 1833 MR. BRACE: And I guess I would ask that, you know, is there going to be brought evidence brought forward to suggest that it's not the case?
LISTNUM 1 \l 1834 THE CHAIRPERSON: Well, we will see.
LISTNUM 1 \l 1835 MR. BRACE: We will see.
LISTNUM 1 \l 1836 THE CHAIRPERSON: Okay, thank you.
LISTNUM 1 \l 1837 Rita, did you have a question.
LISTNUM 1 \l 1838 COMMISSIONER CUGINI: Yes, thank you.
LISTNUM 1 \l 1839 Mr. Brace, you said in response to a question from Commissioner Langford that it takes strong consolidated companies to compete, and, obviously, I mean, I understand why CTVglobemedia takes this position: you have become Canada's largest broadcasters. But you are also part of the industry overall, so I'm going to ask you more of a philosophical question.
LISTNUM 1 \l 1840 If you were sitting up here, what would you do to perhaps strengthen smaller independent broadcasters in the system?
LISTNUM 1 \l 1841 Because we have to think of those people, too.
LISTNUM 1 \l 1842 MR. BRACE: I agree. It becomes a question of managing a balanced system, and how do we do that.
LISTNUM 1 \l 1843 We are big. We believe that consolidation is beneficial. We believe that it creates more diversity. And all of those are good things, we hope.
LISTNUM 1 \l 1844 But it doesn't diminish the importance of the independents and the people who are offering different opinions, diverse opinions, and offering more opinions.
LISTNUM 1 \l 1845 I think that, in that respect, what is really important is to make sure that we keep an eye on barriers to entry; that we do everything we can in terms of encouraging people to come on board, whether it is through the Category 2 licensing regime ‑‑ and, more specifically, that we look at distribution, because I think that one of the keynotes we have heard from the Chair and we have heard from the Commission is access. There is no point in starting something and trying to build something if no one is available or you can't get it to anyone ‑‑ if it falls out the end of a pipe and goes nowhere.
LISTNUM 1 \l 1846 When we come to the pay and specialty review, and the BDU review, it is going to be really important to talk about what we do about access. Obviously, it is going to be important for us ‑‑ vitally important ‑‑ but it is absolutely crucial for small independents.
LISTNUM 1 \l 1847 Those are the two areas that I think we need to look at.
LISTNUM 1 \l 1848 COMMISSIONER CUGINI: Thank you.
LISTNUM 1 \l 1849 Thank you, Mr. Chairman.
LISTNUM 1 \l 1850 THE CHAIRPERSON: Commissioner Morin.
LISTNUM 1 \l 1851 COMMISSIONER MORIN: You are a big player in the Canadian broadcasting system, and I would like to ask you about the idea of having an ombudsman at CTV. Would you say that it would be a good advantage for your listeners, for your clients?
LISTNUM 1 \l 1852 Many big players have this kind of thing ‑‑ an ombudsman ‑‑ to improve diversity.
LISTNUM 1 \l 1853 MR. BRACE: If I understand your question correctly, Mr. Commissioner, you are suggesting that we have an ombudsman that would, on behalf of the public ‑‑
LISTNUM 1 \l 1854 COMMISSIONER MORIN: Yes.
LISTNUM 1 \l 1855 MR. BRACE: That would kind of monitor and oversee suggestions?
LISTNUM 1 \l 1856 COMMISSIONER MORIN: Exactly.
LISTNUM 1 \l 1857 MR. BRACE: What I would say to that is, that is exactly the direction we go with the CBSC. That is what they are in place for. That is what their code would be.
LISTNUM 1 \l 1858 We can elaborate on our views on that ‑‑ I know that Sarah Crawford would be happy to do that ‑‑ but we don't think that is necessary, based on the fact that we have something in place that we are going to subscribe to that will deal with that issue.
LISTNUM 1 \l 1859 MR. HURST: May I add, Commissioner, that the CBSC, in my view, is a much more public and transparent organization when complaints about, especially, news broadcasting come to the fore.
LISTNUM 1 \l 1860 The CBC ombudsman in English Canada is effective, but I think the CBSC does a terrific job, and a transparent job, against several stated and published codes.
LISTNUM 1 \l 1861 MR. BRACE: We did a little analysis ‑‑ and it is the kind of research that you sometimes wonder whether it's good or bad, but I suppose, in this case, we would look upon it as a good thing.
LISTNUM 1 \l 1862 What we found is that, in 80 percent of the complaints that go to the CBSC, they find against the broadcaster.
LISTNUM 1 \l 1863 So they really are doing what we believe is an arm's length, non‑biased job in determining where there are issues and dealing with them.
LISTNUM 1 \l 1864 COMMISSIONER MORIN: Would you be open to having journalists on the CBSC panel?
LISTNUM 1 \l 1865 MR. BRACE: What I would like to do is ask Sarah Crawford to comment on the format and the design.
LISTNUM 1 \l 1866 Sarah, do you have a comment on that?
LISTNUM 1 \l 1867 MS CRAWFORD: Sure.
LISTNUM 1 \l 1868 My general comment is that we do see the CBSC as having an impeccable track record, and the codes that it currently administers also provide to address some of the concerns that you are addressing.
LISTNUM 1 \l 1869 The Code of Ethics talks about journalistic independence.
LISTNUM 1 \l 1870 The RTNDA Code has much language about journalistic independence.
LISTNUM 1 \l 1871 In terms of your question about whether we would support journalists being involved on CBSC adjudication panels, right now, as you know from their submission, those panels are very carefully balanced panels. They are diverse in terms of regionality, in terms of linguistic diversity, in terms of public and private.
LISTNUM 1 \l 1872 There is equal representation there, and the people from the private sector come from all walks of life ‑‑ and from the industry sector, for that matter.
LISTNUM 1 \l 1873 Journalists are, I believe, currently represented on many of the adjudication panels, and I would accept, and we would certainly welcome if journalists were to be represented on an adjudication panel regarding the proposed code.
LISTNUM 1 \l 1874 THE CHAIRPERSON: Ron, do you have a question?
LISTNUM 1 \l 1875 COMMISSIONER WILLIAMS: Thank you, Mr. Chair.
LISTNUM 1 \l 1876 Mr. Brace, in your presentation earlier, and in some of your comments relating to consolidation, you talked about a continuum being many owners and, then, perhaps a scenario of where there would be a single owner, which may not be as appealing as having some diversity.
LISTNUM 1 \l 1877 Do you think that less diversity of ownership as a result of consolidation would result in less diversity of programming choices, and less plurality of editorial voices?
LISTNUM 1 \l 1878 I am mindful, in your presentation, that you said, simply put, that homogenization of programming destroys value, but I would like you to elaborate a bit on that, please.
LISTNUM 1 \l 1879 MR. BRACE: If I understand correctly, Mr. Commissioner, in other words, there are more owners, and will that create less diversity? Is that what you are asking, or the opposite?
LISTNUM 1 \l 1880 COMMISSIONER WILLIAMS: No, I want you to follow up on less owners.
LISTNUM 1 \l 1881 MR. BRACE: Fewer owners?
LISTNUM 1 \l 1882 COMMISSIONER WILLIAMS: Fewer owners. Yes, please.
LISTNUM 1 \l 1883 MR. BRACE: I think what we have demonstrated is that consolidation, in the environment that we face, is absolutely necessary if we are going to compete, because we don't compete just domestically any more, we compete with everything that is coming in, especially through the unregulated media. I think we all recognize that issue.
LISTNUM 1 \l 1884 The consumers ‑‑ the viewers and the listeners ‑‑ at the end of the day are the ones that are making the choice.
LISTNUM 1 \l 1885 We see the fragmentation ‑‑ and I don't mean fragmentation between specialty and conventional. We know that is there. We know that we compete in that environment. I mean the fragmentation that is developing with the new platforms.
LISTNUM 1 \l 1886 We need to be able to combat that because, at the end of the day, to meet the objectives of the Act, we want to deliver quality Canadian programming. In our view, that is programming that Canadians want to watch. It has to be well funded, well resourced, well supported and well promoted.
LISTNUM 1 \l 1887 In our view, consolidation can deliver that. In fact, I think we have demonstrated that it does deliver that.
LISTNUM 1 \l 1888 The conversation here is: When does it reach the critical point? When do you raise the yellow flag and say, "All right, there is an issue"?
LISTNUM 1 \l 1889 That, for us, is equally important. We need to be able to determine that, but it's not simple.
LISTNUM 1 \l 1890 What we have suggested is that, possibly, the place to start is looking at what is available now.
LISTNUM 1 \l 1891 Are we agreeing wholeheartedly that there is a problem, or are we really examining the situation to see if, indeed, there might be, and, therefore, do we have to react to it?
LISTNUM 1 \l 1892 I guess our concern at this point is kind of establishing benchmarks, metrics, and putting fences around the marketplace, understanding that it is changing so rapidly and dynamically, without really first understanding if, in fact, there is a problem.
LISTNUM 1 \l 1893 I know that the CAB is going to put on the record the research they have done that addresses that. We have done some of our own. In every market, in every major market across the country, what we have found is that the number of choices ‑‑ just choices ‑‑ has grown monumentally in the last 30 years, and the number of ownership groups, or voices I will call them ‑‑ so voices and choices ‑‑ the number of voices over the last 30 years has actually grown, as well.
LISTNUM 1 \l 1894 We are still seeing, for example, that in Winnipeg, currently, there are 31 ‑‑
LISTNUM 1 \l 1895 And this is just television, by the way. This isn't newspaper, this is television and specialty television.
LISTNUM 1 \l 1896 ‑‑ there are 31 ownership groups.
LISTNUM 1 \l 1897 In Edmonton there are 25, and so it goes.
LISTNUM 1 \l 1898 Even in Ottawa we have 19 independent voices.
LISTNUM 1 \l 1899 When we look at those numbers, we say: That's quite a few. There is a lot out there.
LISTNUM 1 \l 1900 Are we really in trouble? Do we really have a problem? Are people raising the issue, and where is the evidence to support that?
LISTNUM 1 \l 1901 It is managing the balance, which I spoke to with Commissioner Cugini. It really is: When do we determine that there is a problem.
LISTNUM 1 \l 1902 Because, right now, we don't see evidence of one.
LISTNUM 1 \l 1903 THE CHAIRPERSON: With all due respect, that is not what this hearing is about. It is not "Do we have a problem?" You and everybody else has said that we are in a wave of consolidation. You have to consolidate and you have to become bigger.
LISTNUM 1 \l 1904 The issue is, fine, we understand that, but, as we go forward, what rules do we put in place so that, while you consolidate, we don't lose the diversity of voices, or the plurality of voices.
LISTNUM 1 \l 1905 That is the issue.
LISTNUM 1 \l 1906 MR. BRACE: We agree wholeheartedly, but it is what do those need to be, and let's identify what the problem is, and understand the dynamics of the rapidly changing environment, so that we aren't in a situation where our fences and our metrics are out of date almost as soon as they are put in.
LISTNUM 1 \l 1907 We believe that what we have now in place is working.
LISTNUM 1 \l 1908 THE CHAIRPERSON: Just as a follow‑up, you heard the CBC this morning. One of the things they suggested, essentially, is that we adopt the Australian rule of 2 out of 3.
LISTNUM 1 \l 1909 That would put you into a problem, if one counts the Toronto Globe and Mail as a local paper rather than national. How would you see yourself?
LISTNUM 1 \l 1910 Do you see the Globe and Mail as a national paper or a local paper, or both?
LISTNUM 1 \l 1911 MR. BRACE: I think we would determine that the Globe and Mail is a national newspaper, but the notion of the Australian system is bewildering to us, just by virtue of ‑‑ it really is apples and oranges.
LISTNUM 1 \l 1912 THE CHAIRPERSON: I am only talking about this one aspect of the Australian system.
LISTNUM 1 \l 1913 MR. BRACE: We would declare that the Globe and Mail would be a national newspaper.
LISTNUM 1 \l 1914 I can't speak for the Globe and Mail, but I think that's what they would say.
LISTNUM 1 \l 1915 THE CHAIRPERSON: Michel, you had a question on financial reporting?
LISTNUM 1 \l 1916 COMMISSIONER ARPIN: Yes.
LISTNUM 1 \l 1917 You heard me earlier today talking with the CAB regarding the divulging of financial information by major broadcasters in an aggregate manner, and I was wondering what were the views of CTVglobemedia.
LISTNUM 1 \l 1918 Do you see any specific problems regarding the CRTC making publicly available your over‑the‑air television and your radio financial information?
LISTNUM 1 \l 1919 MR. BRACE: I think what we need to be sure of ‑‑ and this may be the comfort we are looking for in the discussion ‑‑ what we need to be sure of is that in no way does this public information give competitors a chance to understand our rates and our rights fees; and that competitive information, particularly in radio, becomes a lot more sensitive, due to the local nature of radio.
LISTNUM 1 \l 1920 That is number one.
LISTNUM 1 \l 1921 Number two, it is not happening across the board. The CBC doesn't deliver this information, nor do producers, nor do BDUs.
LISTNUM 1 \l 1922 I think, thirdly, we already provide the information to the Commission.
LISTNUM 1 \l 1923 At this point in time, I think we would want to think about this, Commissioner. I think we would like to take this under advisement.
LISTNUM 1 \l 1924 I know that you proposed, and in the letter it talked about some kind of aggregate type of concept that might give us some comfort, but I wouldn't want to really comment on that in terms of supporting it or defending against it at this point in time.
LISTNUM 1 \l 1925 COMMISSIONER ARPIN: Could we expect to have your reply by October 5th?
LISTNUM 1 \l 1926 MR. BRACE: I think we could do that, yes.
LISTNUM 1 \l 1927 COMMISSIONER ARPIN: Thank you very much, Mr. Chair.
LISTNUM 1 \l 1928 THE CHAIRPERSON: All right. Thank you very much.
LISTNUM 1 \l 1929 We are right on schedule. Thank you for your submissions.
LISTNUM 1 \l 1930 MR. BRACE: Thank you.
LISTNUM 1 \l 1931 THE CHAIRPERSON: Madam Boulet, we will take an hour break now, if I understand correctly.
LISTNUM 1 \l 1932 THE SECRETARY: Yes, that's correct, Mr. Chairman.
LISTNUM 1 \l 1933 We will break until 1:30.
‑‑‑ Upon recessing at 1228 / Suspension à 1228
‑‑‑ Upon resuming at 1332 / Reprise à 1332
LISTNUM 1 \l 1934 THE CHAIRPERSON: Madame Boulet.
LISTNUM 1 \l 1935 THE SECRETARY: Thank you, Mr. Chairman.
LISTNUM 1 \l 1936 I would now invite CanWest MediaWorks to make their presentation. Ms Kathy Dore will be introducing her panel, after which you will have 10 minutes for your presentation.
LISTNUM 1 \l 1937 Ms Dore.
INTERVENTION
LISTNUM 1 \l 1938 MS DORE: Thank you.
LISTNUM 1 \l 1939 Good afternoon, Chairman, commissioners and Commission staff.
LISTNUM 1 \l 1940 My name is Kathy Dore. I am President of CanWest MediaWorks and oversee all of our broadcast operations.
LISTNUM 1 \l 1941 I would like to begin our presentation by introducing the members of our panel.
LISTNUM 1 \l 1942 To my immediate right is Steve Wyatt, Senior Vice‑President of News and Information.
LISTNUM 1 \l 1943 To his immediate right is Barbara Williams, Senior Vice‑President of Programming.
LISTNUM 1 \l 1944 To my immediate left is Charlotte Bell, Vice‑President of Regulatory Affairs.
LISTNUM 1 \l 1945 In the row behind us, starting from my left, is Chris McGinley, Senior Vice‑President of Broadcast Operations.
LISTNUM 1 \l 1946 Next to her is Kathy Gardner, Senior Vice‑President of Research and Promotions.
LISTNUM 1 \l 1947 And next to her is Ken Goldstein, President of Communications Management, who prepared the study attached to our submission in this proceeding.
LISTNUM 1 \l 1948 And seated next to Ken is Jonathan Medline, Director of Regulatory Affairs.
LISTNUM 1 \l 1949 First and foremost, we would like to thank the Commission for the opportunity to participate in this proceeding examining diversity issues.
LISTNUM 1 \l 1950 We believe that this review is both timely and forward‑thinking in light of the pace of change in our industry and we are pleased to appear before you to share our views.
LISTNUM 1 \l 1951 Over the years, the Commission has carefully developed policies and regulations that have allowed consolidation to occur in order to create strong Canadian media companies better able to compete in an increasingly complex and competitive environment.
LISTNUM 1 \l 1952 At the same time, the Commission has imposed safeguards and conditions on a case‑by‑case basis to allow the benefits of consolidation while still enhancing diversity of voices.
LISTNUM 1 \l 1953 This flexible approach has been in the public interest as it has afforded the Commission reasonable latitude to assess each case on its own merits and take appropriate actions accordingly.
LISTNUM 1 \l 1954 In fact, we believe that the Commission already has the tools it needs to move forward without resorting to rigid policy‑making that might impede its ability to assess and react to changing circumstances in an environment that is anything but static.
LISTNUM 1 \l 1955 In the last decade there has been an unprecedented amount of licensing of both conventional and discretionary services as well as the addition of dozens of foreign services authorized for carriage in Canada.
LISTNUM 1 \l 1956 If a customer subscribes to cable or DTH, they have access to hundreds of programming choices in every genre imaginable and the option to watch those programs when they want.
LISTNUM 1 \l 1957 This option, a result of BDU‑inspired time‑shifting, is a uniquely Canadian phenomenon. It simply isn't allowed elsewhere, and for very good reasons.
LISTNUM 1 \l 1958 And today, of course, choices are no longer limited to traditional competitors. They now include names no one had heard of a decade ago: Google, Yahoo!, Facebook and YouTube.
LISTNUM 1 \l 1959 Diversity cannot be assured by adding more television services and simply hoping they will survive in this environment. We have already witnessed how companies like Craig and CHUM have had to respond to these pressures.
LISTNUM 1 \l 1960 Consolidation is not so much a choice as it has become a necessity. It is no surprise that we are in the midst of a new wave of consolidation in Canada and, indeed, throughout the world.
LISTNUM 1 \l 1961 The fact is Canadians today have access to one of the richest and most diverse sets of media choices in the world. This is one reason why simply parachuting in ownership models from other countries would not recognize the vast differences in broadcasting systems across the globe or reflect Canada's geographic placement atop the world's largest exporter of electronic entertainment.
LISTNUM 1 \l 1962 Ironically, despite all this choice, there are Canadians who do not receive their local stations because DTH operators do not have to carry local stations, despite the fact that we produce high levels of local programming specifically for those viewers in each local market.
LISTNUM 1 \l 1963 Diversity means more than making programs, it requires making them accessible to viewers. To this end, we share the Chairman's view that access should be a key priority for the Commission going forward.
LISTNUM 1 \l 1964 CanWest has been a significant contributor to the diversity of the Canadian broadcasting system. We have grown from a small regional broadcaster to one of the largest integrated media companies in Canada.
LISTNUM 1 \l 1965 In 2000, the Commission approved our transaction to acquire the television assets of WIC. As part of that transaction, the Commission allowed us to operate stations in smaller markets adjacent to Canada's two largest English‑language television markets: Toronto and Vancouver.
LISTNUM 1 \l 1966 In exchange for this, we committed to broadcasting high levels of local programming directed at viewers in Hamilton and in Victoria and we launched a new national newscast out of Vancouver. We also accepted certain safeguards to ensure diversity of our overall program offerings in those markets.
LISTNUM 1 \l 1967 I would like to invite Steve Wyatt and Barbara Williams to tell you about the ways in which we are living up to our commitments.
LISTNUM 1 \l 1968 MR. WYATT: Commissioners, CanWest's acquisition of WIC seven years ago did not lessen editorial news diversity in Canada. In fact, it enhanced it.
LISTNUM 1 \l 1969 As Kathy just mentioned, one of the benefits of that transaction was to add a much needed third national news voice in this country and I am proud to say that after six years of building, investing in and refining Global National, we are now the most watched national newscast in the country Monday through Friday.
LISTNUM 1 \l 1970 Even more impressive is the fact that the introduction of Global National actually increased overall viewing to national news in Canada. This was no small accomplishment given the historical stronghold of both CBC and CTV in this area.
LISTNUM 1 \l 1971 Global National required major investments in infrastructure and talent in order to compete. In fact, since we launched, our spending has almost tripled from the original investments we made. Over time, we have also almost doubled Global National's staff. The results were well worth it.
LISTNUM 1 \l 1972 To illustrate, we have appended a chart to our presentation showing the impact of Global National to national news viewing since 2000‑2001.
LISTNUM 1 \l 1973 As you can see, total viewing to national news has increased by 36 percent but none of this would have been possible without Global consolidating with WIC in 2000.
LISTNUM 1 \l 1974 As a regional broadcaster, Global simply did not have the necessary resources or reach to compete in the national news market and was limited to offering a national news program in Ontario through its flagship station out of Toronto.
LISTNUM 1 \l 1975 In Hamilton and Victoria, our newsrooms are managed separately from our stations in Toronto and Vancouver. All editorial decisions are driven locally.
LISTNUM 1 \l 1976 As part of our commitment to diversity, we promised to greatly increase local news presence in both Hamilton and Victoria. In Hamilton, we added significant hours of local programming. In Victoria, we eliminated the historical rebroadcast of the Vancouver news program on CHEK‑TV and added more local hours.
LISTNUM 1 \l 1977 As you will see from the attached charts, 83 percent of the viewers watching our supper hour newscast on our Hamilton station reside in Hamilton. Similarly, 93 percent of the audience watching our supper hour newscast on our Victoria‑based station reside on Vancouver Island.
LISTNUM 1 \l 1978 The reason is simple. Our newscasts are intensely local and are designed to reflect issues of importance to residents in Hamilton and Victoria, not the metropolitan markets of Toronto and Vancouver.
LISTNUM 1 \l 1979 It has been six years now since CanWest acquired its newspaper assets. During this time, our television news operations have maintained a fiercely independent editorial voice both locally and nationally.
LISTNUM 1 \l 1980 We have expanded our local news programming in some markets and nearly doubled our financial commitment to Global National.
LISTNUM 1 \l 1981 In some markets, we have on occasion teamed up with our print colleagues to embark on special joint investigative projects where the two media will provide distinctively different angles on important issues to the community, and at all times our television news operations set their own editorial agenda and assign their own crews.
LISTNUM 1 \l 1982 It is because of this determined independence in generating, assigning and producing our own content that neither the CBSC nor the CRTC have received a single complaint in the past six years about common ownership diluting or inhibiting the array of news choices in the communities we cover.
LISTNUM 1 \l 1983 MS WILLIAMS: Commissioners, as you know, CanWest operates the Global Television Network which is seen in most markets across Canada, as well as another smaller group of conventional stations which is available in a more limited number of markets.
LISTNUM 1 \l 1984 As part of our commitment to programming diversity, we have always programmed these two entities distinctively, and frankly, it is also in the best interest of our business to do so.
LISTNUM 1 \l 1985 Given the challenges facing conventional television, especially in light of the growing popularity of specialty services, it is important for us to stand out in each market where we operate and ensure that our content is unique and distinctive on both networks.
LISTNUM 1 \l 1986 We need to provide diverse programming alternatives so that both services can be successful, not one successful only at the other's expense.
LISTNUM 1 \l 1987 That is why on September 7th we re‑branded and re‑launched our CH network of stations under the E! banner, to provide a distinct and diverse programming lineup from that which is on Global, and equally important, why on those newly branded E! stations we have made the decision to bring back the heritage call letters of the stations and provide distinct local news to the communities of those local stations, again providing a clear alternative to what Global is providing.
LISTNUM 1 \l 1988 The same theory holds true in specialty television. Success is found by ensuring that each service is providing something different, something unique, not by duplicating what is already there. In fact, in the specialty world the current commitments to genre, Canadian content and program categories ensure this approach.
LISTNUM 1 \l 1989 From a programming perspective, while it is true that increasing ownership allows for some operating efficiencies, it would be detrimental to the overall business if we allowed it to lessen program diversity.
LISTNUM 1 \l 1990 MS DORE: Commissioners, in closing, we share your interest in ensuring that policies and regulations promoting diversity have desired outcomes for the system and that they continue to serve important public policy goals.
LISTNUM 1 \l 1991 We welcome this review and hope that our comments will be helpful in your deliberations.
LISTNUM 1 \l 1992 Thank you for your attention.
LISTNUM 1 \l 1993 I would now like to invite Charlotte Bell to lead us through the question and answer portion of our hearing.
LISTNUM 1 \l 1994 THE CHAIRPERSON: Thank you very much.
LISTNUM 1 \l 1995 You were here this morning when we heard the presentation from CBC. CBC put forward what they described as simple, straightforward rules and they made the point that I have made too, that, in effect, we are looking forward. It is not a question of problems in the market now but if this consolidation that we witness goes forward, do we need any rules, do we need any other safeguards than we have already.
LISTNUM 1 \l 1996 CBC put forward three rules: one was that no owner should have two out of three in any local market, the three being radio, television and newspapers; secondly, that no owner should have more than 33 percent of specialty television; and no owner should own more than two BDUs in any market.
LISTNUM 1 \l 1997 I wonder whether you could comment from your point of view how you see these rules, whether you think they make sense, whether you think they ‑‑ what would be your reaction if the CRTC decided to adopt the CBC proposal.
LISTNUM 1 \l 1998 MS DORE: We believe that the CBC proposal is somewhat arbitrary in terms of the numbers proposed, that the system that is in place is actually working, that there is diversity in the Canadian broadcasting system, and that the Commission should work within the rules in place in order to ensure that, as we enter and compete in a world that is quickly changing, we don't, again, come up against arbitrary rules that will actually weaken the Canadian broadcast system against unregulated competitors and against a very powerful foreign competitor to the south.
LISTNUM 1 \l 1999 Charlotte, do you want to add anything?
LISTNUM 1 \l 11000 MS BELL: Mr. Chairman, with your permission, I would like to make a couple of points.
LISTNUM 1 \l 11001 I think, as we discussed in detail this morning with the CAB, we strongly believe that the Commission already has the tools it needs in place right now to address any areas of concern.
LISTNUM 1 \l 11002 You have policies on conventional television, and you also have policies to address the radio sector.
LISTNUM 1 \l 11003 I think one of the reasons, in fairness, that you don't have any policies concerning ownership concentration on the specialty side is that, obviously, no transaction can occur without you approving it, so you always have the option to take a look, if there are any issues of concern that arise from a particular transaction.
LISTNUM 1 \l 11004 More importantly, they are national services. They are a little bit different. There are a couple of new services, but editorial diversity is not something that is prevalent in the specialty world as much as it is in conventional and on the radio side.
LISTNUM 1 \l 11005 Even CBC admitted that it could be 25 or it could be 33. It really was very arbitrary.
LISTNUM 1 \l 11006 I wonder, unless we have really thought this through ‑‑
LISTNUM 1 \l 11007 And I appreciate your point, Mr. Chairman, that maybe we haven't identified a problem, but I think that to put limits in place, if we don't really know what they might be addressing, or a potential problem that they are going to be addressing, might be a little dangerous.
LISTNUM 1 \l 11008 THE CHAIRPERSON: Put yourselves in our place. When the last three mega deals were announced, lots of people suggested that we should say "stop" and have this Diversity of Voices Hearing first, and then approve the deals.
LISTNUM 1 \l 11009 We didn't do that because we thought it would be fundamentally unfair, having negotiated a deal on existing rules, to change the rules in midstream.
LISTNUM 1 \l 11010 But, by the same token, we said: Before we go any further, you make a valid point, we should look at Diversity of Voices, which is what we are doing now.
LISTNUM 1 \l 11011 And, if there is further media concentration in the communications sector, if there are new rules, now would be the time to adopt them.
LISTNUM 1 \l 11012 So I am somewhat left adrift with your answer, which suggests: You have everything. You can face the future.
LISTNUM 1 \l 11013 So, if tomorrow there was the suggestion of a major merger, let's say, CanWest and Shaw, the present rules are perfectly okay. They will deal with it, you don't have to do anything.
LISTNUM 1 \l 11014 I just use that as one example. You could use whatever example you want.
LISTNUM 1 \l 11015 Don't we have to be a bit more prudent as regulators and try to envision the various combinations, and if there are any that would cause us problems, and, if so, then adopt rules now that would prevent those problems?
LISTNUM 1 \l 11016 MS BELL: We appreciate the fact that you are judging the present transactions before you based on the present rules.
LISTNUM 1 \l 11017 Quite frankly, even if you implemented the recommendations that CBC proposed this morning, they wouldn't affect our transaction, or our proposed transaction, or the positions that we have currently, because we don't have three different media in any given territory.
LISTNUM 1 \l 11018 So it is not because we are directly impacted at this point.
LISTNUM 1 \l 11019 I think there is a fear, however ‑‑ and I think it is justified.
LISTNUM 1 \l 11020 The Commission has announced, also, another policy review. You have announced a BDU review and a discretionary services review. If the rules of carriage ‑‑ if every rule that applies to that sector right now changes, and changes our landscape dramatically, we may want to have some flexibility down the road. We just don't know what that outcome is going to be.
LISTNUM 1 \l 11021 You have just released the Dunbar/Leblanc Report, and, again, that may result in other policy reviews.
LISTNUM 1 \l 11022 What we are saying is, we just don't think it is prudent to have rigid rules at this point, when there is an awful lot of uncertainty before us.
LISTNUM 1 \l 11023 I don't know if Mr. Goldstein would care to add anything.
LISTNUM 1 \l 11024 No, he wouldn't.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11025 MS BELL: I'm on my own.
LISTNUM 1 \l 11026 THE CHAIRPERSON: All right. I think I have made my point.
LISTNUM 1 \l 11027 Rita, you have some questions?
LISTNUM 1 \l 11028 COMMISSIONER CUGINI: Yes, thank you.
LISTNUM 1 \l 11029 I am going to go at the same question in a different way. Of course, you did say that one of the richest and most diverse sets of media choices, that is what Canada has today.
LISTNUM 1 \l 11030 I heard you this morning with the CAB, and I have read your submission, obviously, but, in your opinion, do the current rules impede or promote further consolidation?
LISTNUM 1 \l 11031 MS BELL: I don't know if they do either of those things. I think they allow consolidation to happen, where it's appropriate, but I think we have seen, also, that the current rules allow you to say no.
LISTNUM 1 \l 11032 The current rules allow you to say "Yes, but not this part of it," or "Yes, with certain safeguards."
LISTNUM 1 \l 11033 We like that.
LISTNUM 1 \l 11034 It's not a certain environment, because you don't always know if the Commission is going to say yes or no, or if the conditions they may or may not impose are going to be to your liking.
LISTNUM 1 \l 11035 The fact is, you have the ability to do that right now, and I think that's a good thing for the system.
LISTNUM 1 \l 11036 COMMISSIONER CUGINI: And you would apply that to all aspects of the industry, not just, obviously, CanWest.
LISTNUM 1 \l 11037 MS BELL: Yes.
LISTNUM 1 \l 11038 COMMISSIONER CUGINI: You heard us talking with CTV before lunch, and, based on your submission, I think you agree with them when you say that, in order to compete in this global environment, Canada needs strong consolidated companies.
LISTNUM 1 \l 11039 MS BELL: Absolutely.
LISTNUM 1 \l 11040 COMMISSIONER CUGINI: I will ask you the same question that I asked CTV. What do we do about the small independent broadcasters?
LISTNUM 1 \l 11041 Do we come up with a set of rules that are triggered toward making them even stronger?
LISTNUM 1 \l 11042 Do we have two sets of rules, one for multi‑station owners and one for small independents?
LISTNUM 1 \l 11043 MS BELL: We do. We do, and I think we probably need to continue to do that in some areas.
LISTNUM 1 \l 11044 You are absolutely right, they are not in the same position as large, multi‑station groups.
LISTNUM 1 \l 11045 Our licences are renewed as a group. We have priority programming commitments in prime time.
LISTNUM 1 \l 11046 I am talking about the conventional sector here.
LISTNUM 1 \l 11047 In terms of DTH carriage, some of the small independents, unaffiliated with any large station group, have more protections, or carriage protection than we do.
LISTNUM 1 \l 11048 It's not perfect, but the rules are different in a number of areas, and I would agree that the Commission should continue to look at ways of strengthening the smaller players, absolutely.
LISTNUM 1 \l 11049 COMMISSIONER CUGINI: Again, we talked a bit this morning, when you were here with the CAB, about local programming. Not everybody agrees with your position. In fact, intervenors have argued that consolidation has or can result in fewer voices in the market, and that its impact has resulted in, one, actually influencing what editorial voices there are in a market; and two, reducing the level and quality of local reflection.
LISTNUM 1 \l 11050 I would like to give you the opportunity to respond, from a CanWest perspective, on what these intervenors have said.
LISTNUM 1 \l 11051 MS BELL: I am going to turn this over to Steve Wyatt, who is our head of news, but ‑‑ I don't want to be repetitive, but I am going to be, just for a moment.
LISTNUM 1 \l 11052 As we mentioned in our opening remarks ‑‑ and we did it very deliberately ‑‑ consolidation for us meant that we did add diversity in certain markets.
LISTNUM 1 \l 11053 Just very quickly, prior to CanWest taking over the station in Hamilton, for example, the majority of the viewers to that Hamilton newscast lived in Toronto. You know why? Because the newscast was directed at Toronto.
LISTNUM 1 \l 11054 We added diversity. That wasn't going to happen unless that station, and the WIC group of stations, came under a larger umbrella, a company that had the resources to do that.
LISTNUM 1 \l 11055 We have no interest in competing against ourselves in markets where we have two stations, and we are not doing that.
LISTNUM 1 \l 11056 I think that really does speak to diversity. I think it speaks to some of the benefits of consolidation.
LISTNUM 1 \l 11057 I will ask Steve to speak in more detail about our local news.
LISTNUM 1 \l 11058 MR. WYATT: One of the approaches that Global took following the acquisition of the WIC stations was to really develop itself as a news agency, because, frankly, we weren't regarded as such for many years.
LISTNUM 1 \l 11059 It was through the acquisition of the WIC resources that we were able to combine these two companies and really make a strategic move forward to develop another voice in news in Canada, both at the local and national levels.
LISTNUM 1 \l 11060 Local news is extremely important to us. In fact, we have, over the years, expanded our hours of local programming in the mornings ‑‑ on Saturday morning and Sunday morning ‑‑ especially in Alberta and B.C. We added a local morning program in Ontario.
LISTNUM 1 \l 11061 So we have really done a lot to make our own voice louder, and also turn over those decisions on how that voice speaks to local management.
LISTNUM 1 \l 11062 We own television stations in Hamilton and Victoria, as I mentioned before, and, again, under the old WIC days ‑‑ and I was there during the old WIC days ‑‑ the CHAN Station in Vancouver used to try to get its supper‑hour news program on CHEK, and it was beneficial to that operation at the time. But now we have taken a very different approach and really tried to encourage a local voice in each and every market.
LISTNUM 1 \l 11063 I think that is the important piece of this, from a broadcasting point of view.
LISTNUM 1 \l 11064 In terms of our common ownership with newspapers, it is a funny thing: there seems to be a bogeyman out there that suggests that somehow there is a conspiracy of news managers to get together and decide "We are all going to tell the same story today."
LISTNUM 1 \l 11065 I can tell you that that runs afoul of the very heart of why people enter this business. Even in the largest markets where we have a presence, each and every one of our news operations is fiercely independent and competitive. It would be foolish of us to even contemplate telling the same story across various media.
LISTNUM 1 \l 11066 The public wouldn't let us do that, for one thing. If they hear it once, they don't want to hear it again.
LISTNUM 1 \l 11067 We make a very deliberate choice to tell different kinds of stories on different platforms.
LISTNUM 1 \l 11068 And I can say this, too. One of the most successful news operations at a local level in Canada is that of the station we own in Vancouver. It has always had the philosophy that you read the newspaper to decide what you are not going to cover.
LISTNUM 1 \l 11069 We need to deliver news and information in different ways and on different platforms, and constantly update it, refresh it ‑‑ whatever ‑‑ to keep our audience growing.
LISTNUM 1 \l 11070 COMMISSIONER CUGINI: Since you raised the issue of news, I know that you support the journalistic code, as submitted by the CBSC, and yet, in particular, the Canadian Media Guild said that the code will not be effective. They are very concerned that the CBSC is basing its code on a faulty assumption, namely, that the diversity and quality of information is not inhibited by the common ownership of news‑gathering resources and the use of complementary technologies.
LISTNUM 1 \l 11071 How do you respond?
LISTNUM 1 \l 11072 MS BELL: We don't agree. We feel that the code is doing what it was designed to do.
LISTNUM 1 \l 11073 This isn't a new code. I think there is a bit of a fallacy there. It's not a new code. The code has been in place for almost seven years.
LISTNUM 1 \l 11074 As we said earlier ‑‑ and, again, I don't want to repeat everything I said earlier ‑‑ it was established as a result of significant and thorough public debate during our renewals.
LISTNUM 1 \l 11075 The code that is before you presently mirrors exactly what is in our conditions of licence. The only difference is, we are changing the process. We are introducing self‑regulation, so it would be administered by the CBSC.
LISTNUM 1 \l 11076 That is really the only difference. So I think to say that this won't work ‑‑ it already does work. There have been absolutely no complaints over the last seven years concerning adherence to the code or the code itself.
LISTNUM 1 \l 11077 COMMISSIONER CUGINI: One of the clauses in the code, which I know already exists in the CanWest code, is that news managers will not sit on the editorial boards of affiliated newspapers, nor will broadcasters permit any member of the editorial board of any affiliated newspaper to participate in the news management of their broadcasting operations.
LISTNUM 1 \l 11078 In the CanWest situation, who decides who will sit on which of the two editorial boards?
LISTNUM 1 \l 11079 MR. WYATT: The newspapers decide who sits on their boards, and we decide who works on the management side of our television operations. There is no linkage.
LISTNUM 1 \l 11080 COMMISSIONER CUGINI: So there is no way that the owner has any influence over who will sit on which editorial board.
LISTNUM 1 \l 11081 MR. WYATT: No.
LISTNUM 1 \l 11082 COMMISSIONER CUGINI: Thank you.
LISTNUM 1 \l 11083 You have heard us ask everyone up until now what you believe the impact of the disclosure of financial information will have on our operations, and, like everyone else, I want you to give us your views.
LISTNUM 1 \l 11084 MS BELL: I am becoming repetitive. As I said this morning on the CAB panel, we have concerns about disclosing additional information. I made certain key points. I think there is a concern that, especially on the conventional television side, because there are fewer players competing for programming, both domestic and foreign programming, I am not sure we are comfortable with our competitors having more information than they already have in terms of what we are spending and what we are doing.
LISTNUM 1 \l 11085 Having said that, we would also like the opportunity to file some more detailed comments on October 5, as other parties have indicated that they would be doing, concerning that issue.
LISTNUM 1 \l 11086 COMMISSIONER CUGINI: I understand from what you said this morning and from what CTV said this morning as well the competitive reasons why we shouldn't. What perhaps you could address in your written submission is what is the public interest that is served by disclosing this information. For example, expenditure on Canadian programming. Your opinion as to whether or not there is a public interest served in disclosing this information.
LISTNUM 1 \l 11087 MS BELL: I am going to ask Mr. Goldstein, I think he has something that he would like to add.
LISTNUM 1 \l 11088 COMMISSIONER CUGINI: Sure.
LISTNUM 1 \l 11089 MR. GOLDSTEIN: Thank you, Commissioner. First of all, I agree with what Charlotte has said about some very good reasons for not doing it and you have heard some of the reasons expressed earlier in terms of inequity, competitive information, not just as between broadcasters but with other suppliers and all parts of the value chain.
LISTNUM 1 \l 11090 But there may be some unintended consequences here for the Commission in terms of the way it releases data. This is kind of a technocratic point, but I think it is important to get on the record. At the moment the Commission releases data at a national level, at a provincial or regional level and at a metropolitan level if there is enough reporting units in the metropolitan area so you won't have disclosure of an individual operation and that is very useful.
LISTNUM 1 \l 11091 In the recent radio review, for example, we were able to look at those data and we were able to see very clearly that markets below 250,000 in size had very different characteristics than some of the bigger metro markets and you modified your policies on that basis. So what you produce today is important and useful.
LISTNUM 1 \l 11092 If you lay over top of that this group release of the same kinds of information you could, by combining all of the data, end up with a huge residual disclosure problem. Meaning, that people like me who make a living doing this are going to take all those numbers and start subtracting like crazy and before we are finished every station is going to be on the public record.
LISTNUM 1 \l 11093 So I think you have to think very clearly about the benefits of doing what you suggest you want to do here against perhaps not being able to do some of your current release of data. And I would echo what others have said, that I think the Commission has the necessary tools to monitor compliance. And we did, of course, have the precedent at the last group licence process in 2001 where you did at that time in the context of the licence renewal put these data on the public record.
LISTNUM 1 \l 11094 COMMISSIONER CUGINI: Mr. Goldstein, I thank you for your technocratic,
LISTNUM 1 \l 11095 I know we can always count on it. And I would be remiss if I didn't say how much the Commission does appreciate the study that you included in the CanWest submission. It certainly will be helpful to us in our deliberations.
LISTNUM 1 \l 11096 Thank you, Mr. Chairman, those are my questions.
LISTNUM 1 \l 11097 THE CHAIRPERSON: As far as the technocratic response is concerned of course it didn't address the question that was asked, which is what is the public interest? And, you know, other interveners want to make intelligent submissions to us and they do not have that data. It is not a question of the CRTC having the data, it is a question whether it is in the public interest to put that data out so we can have an informed debate and informed submissions. I trust you will address that issue in your written response on October 5?
LISTNUM 1 \l 11098 MS BELL: We would be happy to.
LISTNUM 1 \l 11099 THE CHAIRPERSON: Ms Bell, coming back to you, I am somewhat perplexed by your answer and while my colleague was asking the question I was mulling it over. A lot of players in the industry ask for predictability, consistency, they want to know what the rules are so they can structure their deals, they can consolidate or do whatever is necessary to enhance their position.
LISTNUM 1 \l 11100 Did you tell me you would really want us to go forward on a case by case, that is having rules towards further consolidation would make it more difficult. I don't quite understand why it wouldn't be in your interest. Now, you may not like the rules, I understand, but I have always went from the assumption that in business certainty is valued above everything else. And if you know what the rules are you will figure out a way how to work the system to your advantage. But not knowing the rules and having to depend on a sort of case by case response makes it very difficult to plan and go forward.
LISTNUM 1 \l 11101 I wonder whether you can comment on that?
LISTNUM 1 \l 11102 MS BELL: I am not sure what I can add to what we have already said. I mean, unfortunately, we do feel that in an environment, especially the environment that we are in currently in the media world and an environment that keeps changing and that you may continue to change in other ways, as we said earlier, I think there is a danger in imposing very strict rules that down the road we are not going to be able to work around.
LISTNUM 1 \l 11103 I think Kathy Dore wants to add something to this.
LISTNUM 1 \l 11104 MS DORE: I would just say that we start out by believing that Canadian broadcasting does not have a diversity problem currently and that, in fact, diversity and quality are often enhanced by consolidation as opposed to the opposite. Therefore, the potential downside of having more rules, greater regulation in the competitive environment that we face outweigh the value of having that predictability.
LISTNUM 1 \l 11105 THE CHAIRPERSON: One other question. You heard me talk to CTV about self‑censorship. You mentioned how that consolidation increases the ability to provide views and more diversity of views. Several of the other interveners who we will hear from during the rest of the week suggest that, unfortunately, if you have the same owner then that journalist will exercise a certain amount of self‑censorship and may not express views that are contrary to their owner or at least reflect negatively of their owner. And so therefore, the only way to ensure that all the views come forward is you have diverse ownership so that it is always in somebody's interest to publish things from a different point of view or put it out, diffuse it, etc.
LISTNUM 1 \l 11106 And, you know, large companies, such as yours, who are on the air who have interest in several media are usually the target or are being cited as examples where there is probably self‑censorship going on. I don't know what to do with those allegations, that is why I wanted to sort of put them to you and see what you think.
LISTNUM 1 \l 11107 Is self‑censorship and issue and, if so, how could we address it?
LISTNUM 1 \l 11108 MS DORE: I will just start and then turn it over to Steve to comment.
LISTNUM 1 \l 11109 I think that if you look at the statistics around our local news programming it is clear that we have different audiences for different newscasts and that the voice across our local stations and international news the voices are quite distinct. If you assume that there is some self‑censorship that goes on involuntarily as opposed to voluntarily, I think today in news and information generally the sources that people can call on across the traditional media and the non‑traditional media in terms of making sure that they have access to varying opinions and diverse voices, the choices are so great that even with consolidation there is very little danger of a singular voice prevailing.
LISTNUM 1 \l 11110 MR. WYATT: The only thing that I would add to that is this, and within the context of the question does, you know, concentration of ownership increase the instances of self‑censorship or at least the temptation to censor oneself. That is a problem that has existed since we started to write words.
LISTNUM 1 \l 11111 I mean, you know, there could be 1,000 owners or there could be one owner. But I think that it would be a natural inclination of some say junior reporter in the field to wonder if what they are about to report is going to be annoying to the employer. It has nothing really in my mind to do with who owns it or how many people own it or anything like that.
LISTNUM 1 \l 11112 I mean, we have a management structure in all our news operations that if the story requires criticism and balance, then it is the responsibility of the producers and assignment managers to support the journalists in the field to make sure they come across with the right kind of story.
LISTNUM 1 \l 11113 So I don't really see it as an issue of common ownership. I see it as something we struggle with everyday. You know, we struggle with advertisers, we struggle with owners, we struggle with politicians and lobby groups. I mean, there is no end of the pressures on journalists to meet everyone else's expectations of what a story ought to be.
LISTNUM 1 \l 11114 THE CHAIRPERSON: Okay. Thank you very much.
LISTNUM 1 \l 11115 Stuart, you had a question?
LISTNUM 1 \l 11116 COMMISSIONER LANGFORD: Yes, thank you, Mr. Chair.
LISTNUM 1 \l 11117 I want to come back to something you said just a moment or two ago, Ms Dore, in response to the Chair's question. You said, and it isn't something new to your submission, CanWest said it in writing and CTV said it and the CAB said it, but you put it nicely and said, we believe that diversity is enhanced by concentration.
LISTNUM 1 \l 11118 It is certainly an argument that has been made both eloquently and forcefully by, as I say, a number of parties to this proceeding. But I think you might agree with me that the first time you read it brings you up a little quickly and you say, hmm, that seems counter‑intuitive. And then we read your explanations and we read Mr. Goldstein's studies and we read other studies and we think, hmm, an argument can be made for that.
LISTNUM 1 \l 11119 But I guess my question is where does it end? And I did put this question to the previous witnesses from CTV. Where does that formula work and where does it stop working? So perhaps it works today with four owners or three owners, possibly four, depending which way we go a little later on this fall. But what happens when you get down to one? So do you have any sense? When you are so sure in your statement that diversity is enhanced by concentration, is there a tipping point where that is no longer true? Just rationally, is there a tipping point here?
LISTNUM 1 \l 11120 MS DORE: I think, certainly in theory, you can go too far with that. I think you have gone too far if market forces actually are such that there isn't a benefit to providing diversity and you have very few companies engaged in actually providing content. So I think those two factors have to be present. And it is nearly impossible today, at least in Canada, for there to be so few voices because there are so many voices coming in from elsewhere.
LISTNUM 1 \l 11121 And I think it is to the benefit of furthering the uniquely Canadian content, uniquely Canadian broadcast structure to have large powerful media companies in fact as much to compete with the content and the companies, powerful players coming in from outside as to ensure that diversity within Canada.
LISTNUM 1 \l 11122 COMMISSIONER LANGFORD: But should I have any comfort as a Canadian regulator from what you have just said? You said ‑‑ I think I have got you exactly here ‑‑ nearly impossible to have too little diversity because there are so many voices coming in from elsewhere. But surely we are talking here about Canadian voices, diversity of Canadian voices. And if we get down to one owner, if you folks do so well and make so much money you buy it all essentially, but for a few CAT2's and Golden West carries of course, as it always will forever. Surely, at that point, would you agree that we have a diversity problem?
LISTNUM 1 \l 11123 MS DORE: I think it is much more likely that the Canadian broadcast system and the diversity that is inherent in it is likely to be destroyed by external forces than it is by one player taking over the Canadian broadcast system. So I agree with you, one broadcast player is probably too few. But I think we are looking very much inward if we discount the fact that the broadcast system in this country is under fire from external sources, not just internal.
LISTNUM 1 \l 11124 COMMISSIONER LANGFORD: I'm not discounting anything, we are here to count everything, but I want you to work with me now because I'm going to sort of rope you into the regulatory role.
LISTNUM 1 \l 11125 We now have you in a position where maybe one is too few, it's just not enough. So could we make a rule that we must have at least two? Would you be comfortable with that rule?
LISTNUM 1 \l 11126 MS DORE: Not at his juncture, I would not be comfortable with that rule. I think it's unlikely, from a market‑force standpoint, in Canada that you would end up with one.
LISTNUM 1 \l 11127 COMMISSIONER LANGFORD: Then, if you are not willing to go that far, which I wouldn't think is very far, frankly, but if your position is that even if we are down to one Canadian media empire, and we still shouldn't regulate, then it seems to me that you should be willing to give us something on the other side.
LISTNUM 1 \l 11128 And I'm serious about this. It seems to me, then, that if there are going to be literally no restrictions on the ownership of Canadian broadcasting services, that one could take all, that surely one, and maybe even two, and maybe even three, because we will go back at it that way, should be willing to accept obligations to do news, for example, obligations to do local news, obligations to have editorial independence.
LISTNUM 1 \l 11129 So can you work with me on that side? Where can we come in on the other side to regulate some sort of independence and diversity for Canadian consumers?
LISTNUM 1 \l 11130 MS DORE: Well, we are very willing to work within the current regulations, which do have those kinds of requirements and ‑‑
LISTNUM 1 \l 11131 COMMISSIONER LANGFORD: They don't, though. No, they don't. We don't have requirements about news right now, so should we get some?
LISTNUM 1 \l 11132 MS DORE: And there is no shortage of news.
LISTNUM 1 \l 11133 COMMISSIONER LANGFORD: Well, I would argue with you on that point. We are seeing some threatening clouds on the horizon for news. You people may be doing an admirable job, but we did see the CHUM Group lay off 280 journalists about a year ago, we have seen people back away, we have seen some of your competitors actively back away from local news, including the CBC, by the way. This isn't strictly a commercial phenomenon. So if we have no guarantees of voices for Canadians through ownership restrictions, what guarantees should we have on the other side? I repeat my question.
LISTNUM 1 \l 11134 MS BELL: Well, I think, if I may ‑‑
LISTNUM 1 \l 11135 COMMISSIONER LANGFORD: You certainly may.
LISTNUM 1 \l 11136 MS BELL: ‑‑ Commissioner Langford, I don't know that you necessarily need ownership rules to address those issues. When you say we don't have requirements for news, we do. My gosh, we do. Let me tell you: 42 hours in Vancouver. I mean, we do have ‑‑
LISTNUM 1 \l 11137 COMMISSIONER LANGFORD: Isn't that local programming?
LISTNUM 1 \l 11138 MS BELL: Most of it is news, though.
LISTNUM 1 \l 11139 COMMISSIONER LANGFORD: But you don't have to have it as news. You could be ‑‑
LISTNUM 1 \l 11140 MS BELL: Still, most of that ‑‑
LISTNUM 1 \l 11141 COMMISSIONER LANGFORD: ‑‑ covering the 4H shows ‑‑
LISTNUM 1 \l 11142 MS BELL: All right.
LISTNUM 1 \l 11143 COMMISSIONER LANGFORD: ‑‑ you could be covering state fairs, you could be ‑‑
LISTNUM 1 \l 11144 MS BELL: But we are not.
LISTNUM 1 \l 11145 COMMISSIONER LANGFORD: No, but you could be.
LISTNUM 1 \l 11146 MS BELL: That's correct, but I think the Commission has oversight. The Commission monitors our performance. Obviously, if that's what we were doing, you would be discussing this with us at our licence renewal, and you might say, "Well, we don't like the way you are addressing your local programming commitments", and you have the option, you have the option to impose conditions of license. You can do that now, and you do.
LISTNUM 1 \l 11147 At our last licence renewal for all of our Global stations, for example, we had a little compliance issue with our local news ‑‑ just a tiny one ‑‑ it was our regional news in Ontario, and the Commission slapped on a condition of license for an entire licence period and said now it's going to become a condition.
LISTNUM 1 \l 11148 So I would argue you absolutely have all the tools, all the power. You have oversight. It doesn't have to be policy, it can be done at licence renewal.
LISTNUM 1 \l 11149 Would there ever be just one? Commissioner Langford, there could only be just one if you allowed there to be just one, because none of those transactions that would lead us to there would ever occur without the Commission overseeing it, placing safeguards if they felt they were appropriate.
LISTNUM 1 \l 11150 I think when we make the point that consolidation ‑‑ consolidation can enhance diversity, and I think the point we were simply making was we feel that it did in the case of WIC.
LISTNUM 1 \l 11151 COMMISSIONER LANGFORD: Let me echo the chairman's comment. Isn't it fairer to you, and fairer to you as business people, who have to get out into the market, who have to be able to bring a verifiable plan to the capital markets and say, "Look, we can do this, there's nothing standing in our way"? Wouldn't it be fairer for us not to do it on a case by case, not to slap these things on you, to use your term, at the last minute, but to say, "Look, the rule is there's going to be at least three, and the rule is they are going to be this size and the rules is you are going to have some local news and you are going to have some national news"? Isn't that fairer, in a way? Even if you don't like the pain now, isn't it fairer to do it that way?
LISTNUM 1 \l 11152 I mean, as you confirmed, again in response to the chairman, we were fair to you in the sense that you made your deals under the existing rules ‑‑
LISTNUM 1 \l 11153 MS BELL: M'hm.
LISTNUM 1 \l 11154 COMMISSIONER LANGFORD: ‑‑ we let the existing rules stand. We try to be fair, but isn't it fairer to have a set of rules that you can live with than to just leave it with this notion that diversity is enhanced by concentration, all is well in the valley and let's just keep marching?
LISTNUM 1 \l 11155 MS BELL: We are going to give Barb Williams an opportunity to add something to this.
LISTNUM 1 \l 11156 MS WILLIAMS: And I think just to say it maybe a little differently, but if we were feeling that the unpredictability was a huge challenge to us, in terms of growing our business or accessing capital or all of those things you suggested, then we would be coming to you and asking for these rules to give us that predictability and give us that sense of fair play.
LISTNUM 1 \l 11157 But I think the changing landscape that's happening so fast around us, the players that are now new to us, that we are trying to figure how to compete with, actually make the landscape, as it exists today, a more fair way for us to be able to come forward with new ideas, with different ways of thinking about putting our business together, with out‑of‑box thinking about how a company needs to grow and change, and allow us to come forward in a much fairer way with ideas that then you can respond to in the moment, given the situation as it is. That's fairer for us in these dynamic times than a set of rules that really won't be necessarily accurate and helpful as the universe unfolds for us.
LISTNUM 1 \l 11158 COMMISSIONER LANGFORD: Well, I appreciate that. I have got to tell you that I'm an in‑the‑box kind of thinker, though, because the box, for me, is set down by Parliament and it's in the Broadcasting Act, and I can't really think outside of the box, you know.
LISTNUM 1 \l 11159 Anyway, I have your answers, but it's difficult for me, when I look at the priorities of Parliament as set out, particularly in section 3 of the Broadcasting Act, and the different directions we are given, the mandate we are given. It's difficult to just stand back and say, well, we are going to accept that concentration can just go and we are also going to accept that we won't do anything but except on a case‑by‑case basis when it comes to things like rules for local content and, more particularly, for news and more particularly for diverse news".
LISTNUM 1 \l 11160 So I just leave you with a bit of the sense of our conundrum. We don't have the ability to think outside of the box in that sort of a way.
LISTNUM 1 \l 11161 I wonder, Mr. Chairman, if I could just ask one more question, sorry. Because I'm not the first questioner, I'm kind of leaping around a little from one big issue to another.
LISTNUM 1 \l 11162 But on the question of benefits, the CAB wants to get rid of benefits. You are not unfamiliar with that body, Ms Bell. Is CanWest in that same camp?
LISTNUM 1 \l 11163 MS BELL: Yes, actually we even advocated that at the last TV policy last fall.
LISTNUM 1 \l 11164 COMMISSIONER LANGFORD: But that was then, you might have changed your mind.
LISTNUM 1 \l 11165 MS BELL: No, and this is now and we haven't changed our mind.
LISTNUM 1 \l 11166 COMMISSIONER LANGFORD: And do you accept this same kind of level playing field argument that we heard from CTV and CAB this morning?
LISTNUM 1 \l 11167 MS BELL: Well, since you are not familiar with ‑‑
LISTNUM 1 \l 11168 COMMISSIONER LANGFORD: You know where I'm coming from.
LISTNUM 1 \l 11169 MS BELL: ‑‑ or not familiar, not pleased with that argument, let me reposition that for you.
LISTNUM 1 \l 11170 I don't know that it's a ‑‑
LISTNUM 1 \l 11171 COMMISSIONER LANGFORD: I wouldn't say I'm not pleased with it. I'm pleased with everything I hear here, but we weigh it.
LISTNUM 1 \l 11172 MS BELL: No, I know, and I don't think that that's ‑‑ I think the position that we take is there was a time when the Commission had a benefit policy that applied to everyone. There was a time when that was. All of a sudden it was dropped for BDUs, without a public process, I would add, because the Commission had started to add ‑‑ or to license competitors to the BDUs, like DTH. DTH hadn't even launched at that point, but the Commission dropped that policy.
LISTNUM 1 \l 11173 COMMISSIONER LANGFORD: You mean without an oral hearing, no, we said.
LISTNUM 1 \l 11174 MS BELL: There was even no written comments.
LISTNUM 1 \l 11175 COMMISSIONER LANGFORD: You just woke up one day and did it.
LISTNUM 1 \l 11176 MS BELL: Absolutely. You check the public notice that Mr. O'Farrell quoted from this morning.
LISTNUM 1 \l 11177 COMMISSIONER LANGFORD: Colville was there ‑‑
LISTNUM 1 \l 11178 MS BELL: Yes.
LISTNUM 1 \l 11179 COMMISSIONER LANGFORD: ‑‑ then, I wasn't. I don't remember any of that.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11180 MS BELL: I have had that discussion with him also.
LISTNUM 1 \l 11181 But in any event, I don't know that it's an issue of parity, except to say if you dropped it for BDUs because of competitive pressures, because you used this rationale one would argue that broadcasters are under much worse competitive pressures than the BDUs were. Our profitability is quite a bit lower than the profitability of the cable industry, who used to be subject to this.
LISTNUM 1 \l 11182 It's applied inconsistently, there's no doubt about it, it's not a parity argument.
LISTNUM 1 \l 11183 COMMISSIONER LANGFORD: What do we do for independent producers? I mean, this is life blood for them. Are you saying just leave it to us and we will take care of them, we need programming and we will buy it? Is that the answer?
LISTNUM 1 \l 11184 MS BELL: Commissioner Langford, the benefits policy wasn't designed for that, in fact I ‑‑
LISTNUM 1 \l 11185 COMMISSIONER LANGFORD: No, but it's working that way now.
LISTNUM 1 \l 11186 MS BELL: Okay, but now I'm dating myself, but the fact is that many years ago the Commission didn't even allow broadcasters to use that money towards programming. We just weren't allowed to do it.
LISTNUM 1 \l 11187 COMMISSIONER LANGFORD: Yes, but that was then.
LISTNUM 1 \l 11188 MS BELL: So it wasn't designed for that.
LISTNUM 1 \l 11189 THE CHAIRPERSON: Let's come back to the hearing, please.
LISTNUM 1 \l 11190 MS BELL: Pardon me?
LISTNUM 1 \l 11191 THE CHAIRPERSON: This is not a hearing into benefits. Let's come back to this, as I said, the issue here.
LISTNUM 1 \l 11192 MS BELL: I'm answering the question.
LISTNUM 1 \l 11193 THE CHAIRPERSON: Yes, I know you are answering and I'm trying to bring both you and Commission Langford back to the hearing.
LISTNUM 1 \l 11194 COMMISSIONER LANGFORD: Well, I'm difficult to control. I want to ask one more question.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11195 COMMISSIONER LANGFORD: Would you suggest, then, on this even playing field, that you would have something similar to what the BDUs have, which is 5 per cent of your gross revenues would go to a production fund, the way they do it, and that way you would have perfect parity?
LISTNUM 1 \l 11196 MS BELL: We didn't ask for parity and, frankly, the 5 per cent has nothing to do ‑‑ BDUs are licensed differently, they have a different role in the system. We have different licences and different obligations that they don't have to adhere to. I don't see the connection between the two, I honestly don't.
LISTNUM 1 \l 11197 COMMISSIONER LANGFORD: Yes. And I do see benefits, by the way, Mr. Chairman, as part of this, because it does add voices, it does add independent production ‑‑
LISTNUM 1 \l 11198 THE CHAIRPERSON: No, Stewart, you are absolutely right ‑‑
LISTNUM 1 \l 11199 COMMISSIONER LANGFORD: Okay.
LISTNUM 1 \l 11200 THE CHAIRPERSON: ‑‑ it's part of the hearing, but, you know, it's not the main concern.
LISTNUM 1 \l 11201 COMMISSIONER LANGFORD: "Stewart, you are absolutely right", would someone mark that transcript? It may never happen again.
‑‑‑ Rires / Laughter
LISTNUM 1 \l 11202 COMMISSIONER LANGFORD: Those are my questions. Thank you, Mr. Chair.
LISTNUM 1 \l 11203 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 11204 No, I thought your question actually brought very well out the difference of the approach that we, as a regulator have.
LISTNUM 1 \l 11205 And CanWest, in this case, and since you have an opportunity to make written submissions, I really think you should think of what we said. We are trying to find simple, straightforward rules so that the future for you is predictable and you can plan; on the other hand, we avoid unforeseen consequences.
LISTNUM 1 \l 11206 It's a very dynamic world, as your colleagues pointed out, but the dynamic also works the other way. We don't want to find out that we wake up one morning and we have a totally concentrated market and we have diversity of voices. So the happy medium that we are trying to find is a few simple, straightforward rules which allows you to react in this dynamic world, yet it gives us some assurance that we are not going to find an overconcentrated market, which is missing plurality and diversity.
LISTNUM 1 \l 11207 Anyway, thank you very much for your questioning.
LISTNUM 1 \l 11208 Before we break, there's one other thing I should announce. In answer to CTV, when we talked about CTF, I said you can make those submissions at the hearing. So I guess I let the cat out of the bag, to some extent, so let me clarify.
LISTNUM 1 \l 11209 The Commission has decision to have a hearing on a few limited issues that came out of the CTF Task Force and the written submissions that were given. The time, the place and the ambit of those questions will be announced in the hear future, but we will have a limited hearing on some of the aspects of the CTF Task Force Report and the submission that we received in reply there, too.
LISTNUM 1 \l 11210 Thank you, that's all.
LISTNUM 1 \l 11211 Madam Boulet, when do we resume?
LISTNUM 1 \l 11212 THE SECRETARY: At quarter to three.
LISTNUM 1 \l 11213 THE CHAIRPERSON: Okay. Thank you.
‑‑‑ Upon recessing at 1430 / Suspension à 1430
‑‑‑ Upon resuming at 1445 / Reprise à 1445
LISTNUM 1 \l 11214 THE CHAIRPERSON: Madame Boulet.
LISTNUM 1 \l 11215 LA SECRÉTAIRE: Merci, monsieur le président.
LISTNUM 1 \l 11216 I would now call on Shaw Communications to make their presentation and invite Mr. Jim Shaw to introduce his panel, after which you will have ten minutes for your presentation.
LISTNUM 1 \l 11217 Mr. Shaw.
INTERVENTION
LISTNUM 1 \l 11218 MR. SHAW: Thank you. Good afternoon, Mr. Chairman and commissioners.
LISTNUM 1 \l 11219 With me here today is Peter Bissonnette, our president; Michael D'Avella, our senior vice‑president of Planning; Ken Stein, senior vice‑president Corporate Regulatory Affairs; Chris Johnston, now an advisor to Shaw; Cynthia Rathwell, vice‑president; Mike Ferras also vice‑president for Shaw.
LISTNUM 1 \l 11220 So, as you can see, we brought in our top team to talk about subjects that you feel are important to you.
LISTNUM 1 \l 11221 In this hearing, the Commission is asking if there is enough diversity of programming and enough different voices in the broadcasting system, given the degree of ownership consolidation in recent years.
LISTNUM 1 \l 11222 We don't believe there is a problem with diversity that would warrant a host of new rules or policies. The best way to ensure diversity in the system is to allow us to serve customers and respond to their needs and demands.
LISTNUM 1 \l 11223 This is because our customers demand diversity, innovation, different viewpoints and choice. Evidence of consumer demand for diversity and greater choice is everywhere in today's environment.
LISTNUM 1 \l 11224 The internet provides consumers with unlimited sources of content and voices as well as a place for their own voice. New businesses and services are springing up daily to respond to this reality. Many are becoming bigger companies and any cable company, satellite company or broadcasting company out today.
LISTNUM 1 \l 11225 We believe the BDU rules have to be eliminated across the board and that this will drive diversity and choice in the system by allowing licensees to respond to the demands of the consumer. This will not destroy our current system. It will make it stronger and it will make it more competitive.
LISTNUM 1 \l 11226 The current rules limit diversity from everything from linkage to genres, exclusivity, preponderance, affiliated service rules to limits on foreign services. Even the simultaneous substitution requirements create an incentive for Canadian broadcasters to air US shows in prime time rather than to create a unique competitive offering on their own.
LISTNUM 1 \l 11227 So, this is the last thing that the Canadian broadcasting system reads right now is a set of new rules.
LISTNUM 1 \l 11228 Peter?
LISTNUM 1 \l 11229 MR. BISSONNETTE: BDUs have the solution to expanding voices in this by expanding choices. We have absolutely no interest in trying to limit content choices. For us at Shaw it is just the opposite. We are in a business of maximising choice. The competitive environment in which we operate compels us to do this. Lighter and more flexible regulation to provide even more choice while I was to distinguish our competitive offerings and add to the rich diversity in the system.
LISTNUM 1 \l 11230 The role and the success of BDUs in offering choice and diversity and in keeping Canadians engaged should not be underestimated.
LISTNUM 1 \l 11231 In just the last six years, Shaw has invested over 4.5 billion dollars in expanding capacity and facilities to introduce new services in our cable and satellite businesses.
LISTNUM 1 \l 11232 On the cable side, we provide a strong analog offering as well as a state of the digital service. Our network offers an unprecedented breath of content to our customers, including local and regional television stations, educational services, specialty and pay services, ethnic services, pay audio, time shift and services, video on demand and tape review and high definition services.
LISTNUM 1 \l 11233 We offer low cost digital customer terminals to encourage digital subscriptions and high definition personal video recorders. We provide pick and pay, team packs and allow customers to build their own packages. We give our customers we serve the best available range of services.
LISTNUM 1 \l 11234 This applies just as much to our small systems as to our system serving the largest metropolitan areas.
LISTNUM 1 \l 11235 For example, we recently acquired the cable system in Salts Spring Island. Through Shaw's Investment and rebuilds, this went from a 30 channel system to a system where customers have access to 200 analog and digital channels, internet and assume Shaw's digital phone service, all this within six months.
LISTNUM 1 \l 11236 This takes investment and hard work and contributes to diversity, competition and to the bottom line of programming services. We are asked by our customers every single day about new services they want.
LISTNUM 1 \l 11237 For example, last month alone, we responded to request for Cintenta, a new international sport service, NHL centres in both standard definition and high definition, ethnic services and other new digital and high definition services.
LISTNUM 1 \l 11238 Shaw's ownership of Star Choice has been equally beneficial to the broadcasting system. We provide over 300 channels of all digital video and audio services on Star Choice, including local signals, pay and specialty service, team packages, ethnic services, tape review and high definition services.
LISTNUM 1 \l 11239 Satisfying the wide and diverse demands of our customers is our business. We are our customers' biggest advocates. This just makes good business sense and is the best way to achieve diversity.
LISTNUM 1 \l 11240 We are often frustrated by the regulatory framework that limits our ability to respond to our customers and the competitive challenges we face.
LISTNUM 1 \l 11241 There are many situations where we have wanted to be innovative and respond to customer demand by launching, moving or repackaging a programming service, but instead of being able to serve customers and add to the diversity within the system, we have been held back by rules that protect the status quo at the expense of Canadian consumers, diversity, innovation and the competitiveness of our system. This simply makes no sense to us.
LISTNUM 1 \l 11242 In a Public Notice announcing this hearing, the CRTC noted two BDU access rules. The pay audio 121 rule and the 521 rule for category 2 services. We are pleased that the CRTC has raised these rules. We believe that these rules limit diversity, are unnecessary and should be eliminated.
LISTNUM 1 \l 11243 MR. D'AVELLA: As Jim and Peter have said, offering a wide variety of programming and content choices is a necessity in the consumer driven marketplace in which we operate.
LISTNUM 1 \l 11244 We have virtually no regulatory protections, lots of competitors both regulated and unregulated and an illegal satellite problem that government and law enforcement agencies don't seem to have the will to address.
LISTNUM 1 \l 11245 Let's turn to the structural separation rules that apply to Star Choice. No one can question Shaw's commitment to making Star Choice a vigourous direct to home competitor. In fact, 40 per cent of our customers are in Western Canada on Star Choice.
LISTNUM 1 \l 11246 We have invested over 1.2 billion dollars, we have attracted some 880,000 customers and we have ensured a competitive distribution market. We have provided a new platform, new audiences and new revenues for programming services. Direct to home is a strong competitor to cable and has forced cable operators to accelerate their digital rule‑outs.
LISTNUM 1 \l 11247 The structure separation requirements limit our ability to maximise efficiency and weaken our productivity at the expense of customers and overall industry competitiveness.
LISTNUM 1 \l 11248 The only real beneficiaries are our competitors, like Bell, that have zero structural separation requirements and who benefit from greater efficiencies and cost structures. Imposing them on Shaw alone is therefore unfair and discriminatory. They are unnecessary in the extremely competitive environment in which Shaw and Star Choice operate.
LISTNUM 1 \l 11249 MR. STEIN: Canada has one of the most competitive distribution sectors where BDU competitors offer literally hundreds of services and strive to satisfy customer demand for even more services every day. We see no evidence that ownership consolidation in Canada has reduced diversity or choice.
LISTNUM 1 \l 11250 As Shaw has expanded, we have been able to greatly extend programming content and diversity. As has been pointed out by others in this proceeding, diversity makes good business sense.
LISTNUM 1 \l 11251 We should be looking for ways to eliminate unnecessary regulation to allow us to serve customers and respond to the changing marketplace, not looking for new rules.
LISTNUM 1 \l 11252 Specifically, the Commission needs to, as per my wish list, eliminate the structural separation rules pertaining to Star Choice; replace all the existing distribution linkage rules in the category 1 mandatory carriage rules with a simple preponderance rule that requires distributors to offer consumers a majority of Canadian programming services; eliminate the 521 category 2 rule and the 121 pay audio rule; eliminate the one per genre policy that insulates services from competition with other Canadian and non‑Canadian services; and open up the list of eligible satellite services so we can give more choice and compete with illegal DTH and free‑to‑air services.
LISTNUM 1 \l 11253 A new diversity framework is needed, not to provide more rules, but to provide a new framework to give consumers more choice.
LISTNUM 1 \l 11254 Jim?
LISTNUM 1 \l 11255 MR. SHAW: Competition is intense. We compete every day for every customer we have. In this environment, we must be innovative, creative, flexible and above all, our number one goal is to be customer focused.
LISTNUM 1 \l 11256 Consumers demand diversity. If we are allowed to respond to consumers, diversity will thrive, competition will thrive and the system itself will be much stronger. So, with that, Mr. Chairman, I thank you for your attention.
LISTNUM 1 \l 11257 THE CHAIRPERSON: Thank you very much. Your submission is certainly clear but, as you know, we are governed by the Broadcasting Act and it imposes a whole host of obligations on us, what to do in order to ensure that the broadcasting system reflects Canada.
LISTNUM 1 \l 11258 I always over‑simplify by saying it basically to one being sure that the Canadian content and, secondly, ensures there is access to a system by and for Canadians.
LISTNUM 1 \l 11259 Keeping that in mind, your solutions of suggesting let our rep, let the market decide and abolish rules I don't think will get us there because also if you did that, you wouldn't necessarily live up to the obligations of the Broadcasting Act.
LISTNUM 1 \l 11260 So, what we have done when we have called this hearing, we suggested that there clearly be a concentration going on and there as a wave and there may be another wave that may be continuing before we come to a situation where we have a situation that we do not want and regret. Let's basically call a halt and have a global survey of where we are.
LISTNUM 1 \l 11261 And we've heard all morning how wonderful diverse our system is and how it meets all the requirements, but even if, let's say, we all accept that, the question is : how can we ensure that it stays that way?
LISTNUM 1 \l 11262 The only sort of substantive submission that we had addressing exactly what we asked for came from the CBC and they suggested in terms of plurality of voices, i.e. ownership and nobody should own all three. The ownership should be respected to two out of three.
LISTNUM 1 \l 11263 You could add newspapers and television or newspapers and radio or radio and television, but not all three, in any given market and focusing on the local market.
LISTNUM 1 \l 11264 Second rule, they said that BDUs can have an enormous market power because of ‑‑ and therefore, there should be a limitation on how much anyone BDU and if BDU had all too much of the market in effect could increase its margin at the expense of the people who produce the programs, which then would reduce Canadian content.
LISTNUM 1 \l 11265 And lastly, that no one person should have more than two BDUs in one market, which basically enshrines where you are right now, but does not allow you to require another BDU in any given market.
LISTNUM 1 \l 11266 I would very much appreciate if you could comment on those.
LISTNUM 1 \l 11267 I know you don't want any more rules, but just for argument sake, the CRTC said, though we agree with the CBC those are sensible, straightforward who we adopt them. What would that mean for Shaw? How would it make your life more difficult or easier, whatever?
LISTNUM 1 \l 11268 MR. SHAW: Okay. Well, I think the first thing that we've said is that we feel that because we are into the two BDUs, which is no different than Bell, Telus, Tastell, everybody else, that we shouldn't have singled out rules that allow us not to even put on some Canadians, okay.
LISTNUM 1 \l 11269 So, we are currently governed by rules that we have to abide by that are current hampering any development for Shaw. So, we said, okay, any rules you have, let's make them equal for everybody.
LISTNUM 1 \l 11270 The CBC thing to me, you know, seems fine for them because, you know, they already have an English, a French, an English, a French and they pretty well have national coverage.
LISTNUM 1 \l 11271 So, they are a total BDU, they are a total carrier cost and they actually have their own BDU system and cost when you look at all their towers and everything.
LISTNUM 1 \l 11272 So, when you kind of look at them, you know, they kind of talk in either side of their ‑‑ on the other side of their mouth when they say that because they want all the rules just to stop everybody from getting close to them.
LISTNUM 1 \l 11273 Again, another example, where they go and spend all their time focused on American programming. I mean I don't know how many American movies I have seen on CBC lately but it is a lot.
LISTNUM 1 \l 11274 So, you know, I don't know how doing that doesn't create diversity of voices.
LISTNUM 1 \l 11275 Like when we go and we ‑‑ we started Star Choice. We put a lot, a lot of money in. It took a long time. It is just making profits now, just, and it has been ‑‑ eight years?
LISTNUM 1 \l 11276 MR. BISSONNETTE: Yes.
LISTNUM 1 \l 11277 MR. SHAW: Eight years.
LISTNUM 1 \l 11278 So we created a competitive thing. Has it hurt the system at all?
LISTNUM 1 \l 11279 Forty percent of the customers come out of Western Canada where we are the main cable provider. I don't see how that hurt anything. It provided a choice. If you don't want that choice, you can go here. If you don't want that choice, go here.
LISTNUM 1 \l 11280 So down the road in the U.S. ‑‑ there are only two providers in the U.S. One has 17 million customers and one has 14. We have 800,000.
LISTNUM 1 \l 11281 And even if the two of them ever went together, which I heard Mr. Stursberg up here ‑‑ who seems to move from the Cable Association to running CanCom, who has moved to Telefilm, who now is a new programming guru at CBC ‑‑ say, well, that can never happen, I think it would make a stronger competitor.
LISTNUM 1 \l 11282 And I would also ask, what channels have we not carried? Like, you know, only ones that are limited by the rules or that customers didn't pick. So I don't think on the BDU side that there is a huge issue about diversity.
LISTNUM 1 \l 11283 I think that, you know ‑‑ I mean if I look at the Rogers lineup, they carry everything. I mean we just signed up ‑‑ I think we are putting on ‑‑ how many new channels this year?
LISTNUM 1 \l 11284 MR. BISSONNETTE: In the last year we have put on close to 100 in some of our smaller systems. In fact, this week coming up we are adding another 40 channels to our small systems.
LISTNUM 1 \l 11285 There are some other things that when we talk about rules, we are looking at moderating some of the rules. Star Choice would love to expose more voices to its customers in the form of community programming and the regulations right now preclude us from doing that.
LISTNUM 1 \l 11286 Wouldn't that be an excellent, excellent distribution method for touching all Canadians, would be through community programming launched on Star Choice.
LISTNUM 1 \l 11287 THE CHAIRPERSON: Okay. Can you answer my question specifically? I gave you the three rules from the CBC. Let us go through them one by one.
LISTNUM 1 \l 11288 The first one is two out of three. In any given market ‑‑ as markets they use the BMM ‑‑ they suggest an owner should not own a TV, a radio station and a newspaper. You can have two out of three but not three out of three.
LISTNUM 1 \l 11289 Would that affect you? I don't think it would affect you. Does that rule give you any problem if we were to adopt it? I am not suggesting we do, I am just trying to listen to your response.
LISTNUM 1 \l 11290 MR. STEIN: I guess our concern overall is although that particular rule wouldn't affect us, our concern overall is that going to very fixed rules is not what we see happening in terms of the media environment we have to deal with over the next five years.
LISTNUM 1 \l 11291 I mean when you get situations where Google is talking about buying television services, et cetera, you are going to be dealing with a different mixture of media over the next number of years and if you come out with a fixed rule that precludes that ‑‑
LISTNUM 1 \l 11292 I mean Australia went to fixed rules but Australia has a totally different situation. They do not really have a multi‑channel universe. They don't have the kind of high‑speed internet penetration that we have.
LISTNUM 1 \l 11293 So I think that from a point of view that the way the Commission has dealt with these situations in the past, which is to look at it on a case‑by‑case basis and to judge it, is the best way to deal with it.
LISTNUM 1 \l 11294 You know, over the last 15 years I used to always think that whenever I went to the regulator and said we were going to do this, the first response from anybody at the Commission was always, I don't think that is going to work, that is going to be a real hurdle, that offends this rule or that rule.
LISTNUM 1 \l 11295 When we did WIC, when we did Star Choice, when we got into specialty services with Rogers, everything ‑‑ and you can ask Mr. Lind this as well ‑‑ everything was no, no, no, you are not going to be able to do that, the rules preclude you from doing it.
LISTNUM 1 \l 11296 So I think that having rules that are, you know, drafted in that way just don't serve the purpose. I think it is much better to look at the situation on a case‑by‑case basis and make your judgments based on that.
LISTNUM 1 \l 11297 THE CHAIRPERSON: Okay. I gather that is a no.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11298 THE CHAIRPERSON: The second rule was that no BDU should have more than 33 percent of the specialty channels and I heard Mr. Stursberg say it was really a question of market power.
LISTNUM 1 \l 11299 If anybody had more than 33 percent, he would be able to negotiate it unilaterally and it would be at the expense of there being sufficient margin for those specialty persons, and in effect, at the end of the day, we would pay for it by way of reduced Canadian content.
LISTNUM 1 \l 11300 MR. SHAW: And would that be ‑‑ that would apply to Newsworld and all those other CBC channels so they wouldn't be allowed to own any of those, they would have to sell them?
LISTNUM 1 \l 11301 THE CHAIRPERSON: No, if they own more than 33 percent of specialty services in Canada, I think is the way they ‑‑
LISTNUM 1 \l 11302 MR. SHAW: You know ‑‑
LISTNUM 1 \l 11303 THE CHAIRPERSON: They are a long way from 33 percent.
LISTNUM 1 \l 11304 MR. SHAW: We don't own any. I mean ‑‑
LISTNUM 1 \l 11305 THE CHAIRPERSON: Well, I assume you are taking cause to ‑‑
LISTNUM 1 \l 11306 MR. SHAW: Well then, John will have to speak for himself because, you know, even John and I sometimes aren't that close.
LISTNUM 1 \l 11307 THE CHAIRPERSON: Okay.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11308 MR. SHAW: You know, not that we have ever disagreed but it has happened the odd time. I come from the other side of the family where we have to make money.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11309 MR. SHAW: But I don't see that as a huge issue. I think maybe that might be a little bit low, like it could be 50, I mean probably up then.
LISTNUM 1 \l 11310 You know, I don't see it consolidating that hard together but even if they did, I mean there will be a commercial negotiation. I think you are going to put conditions on them. You are going to deal with them on a case‑by‑case basis, not something that is going to happen and maybe coulda, shoulda, woulda in 10 years from now, you know. And you are going to have to watch the market. I mean it is going to change a lot.
LISTNUM 1 \l 11311 Like we were dealing with the Commission and they were really wanting us to tell them what is our channel capacity in 10 years and that. Well, you know what, I can barely tell you what it is going to be next year. I don't know what channels I am going to have and how many people are taking HD.
LISTNUM 1 \l 11312 So I think there are lots of opportunities and I think what has happened with mobile video, what is going to happen there. Like we are really, really at the edge. Like where are the telcos going to come down, how is it going to work.
LISTNUM 1 \l 11313 I think you got ‑‑ I wouldn't be that concerned about it unless they tried to dominate with some market power and I think you always have the option of, one, dealing with it at the Commission.
LISTNUM 1 \l 11314 Like we were talking here before. We were wondering about diversity of regulators. So we thought we could have three and they would all go ‑‑ they would all have the same rules. And so I would go to that regulator and talk to him for a while, and then if I didn't like what he said, then I would go to that one, and then I would go over to that one. So we were talking about diversity of regulators.
LISTNUM 1 \l 11315 It is the same kind of thing. So how can you tell me that it is diversity here and then out here ‑‑ so I think everything in moderation, I guess, is what we are saying.
LISTNUM 1 \l 11316 Did that make sense?
LISTNUM 1 \l 11317 THE CHAIRPERSON: I don't think you want three sets of regulators.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11318 THE CHAIRPERSON: And the last one was no one should own more than two BDUs.
LISTNUM 1 \l 11319 Now that, it seems to me, is directed at you right now as a proud owner of two BDUs, Shaw and Star Choice. I guess that means you can't buy Rogers and you can't buy ExpressVu.
LISTNUM 1 \l 11320 COMMISSIONER LANGFORD: I think they could buy Rogers, Mr. Chair. They are not in the same market.
LISTNUM 1 \l 11321 THE CHAIRPERSON: That is true actually.
LISTNUM 1 \l 11322 COMMISSIONER LANGFORD: We would have to get Mr. Stursberg back but I think, if I understood him correctly, that you could buy Rogers.
LISTNUM 1 \l 11323 MR. SHAW: Well, the way the current rules are, there is nothing precluding cable competition from merging up to compete, and down the road, you know, I mean in our view it is just going to be a few cable guys and a few telephone guys going at it and one or two satellites, you know, however that works out.
LISTNUM 1 \l 11324 You know, I didn't know Bell was for sale ‑‑ well, I guess Bell is for sale but ExpressVu isn't ‑‑
LISTNUM 1 \l 11325 THE CHAIRPERSON: I am not suggesting ‑‑
LISTNUM 1 \l 11326 MR. SHAW: ‑‑ but I plan to call Stursberg right after the thing here.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11327 THE CHAIRPERSON: No, but all joking aside, we are really very concerned about the concentration for two reasons.
LISTNUM 1 \l 11328 It may lead to undue market power which then could have an impact on the diversity of programming or it could lead to so few voices that we don't have a plurality of voices speaking and therefore it may affect the good functioning of our democratic system.
LISTNUM 1 \l 11329 I find it hard to accept that you say that we don't need any rules, this will solve itself by the market.
LISTNUM 1 \l 11330 MR. SHAW: Well, you know what ‑‑
LISTNUM 1 \l 11331 THE CHAIRPERSON: The question is what kind of rule, how do we structure a rule that is simple and predictable so that you can ‑‑
LISTNUM 1 \l 11332 This newfound love with on a case‑by‑case regulation is new to me. Every businessman I have talked to has said: For God's sake, give me a rule so I can know how to structure my ‑‑ If you do it on a case‑by‑case, I don't know how to plan, I don't know how to market, I don't know how to finance, I don't know how to go to the markets, et cetera.
LISTNUM 1 \l 11333 So I take this case‑by‑case advocacy with a grain of salt.
LISTNUM 1 \l 11334 MR. SHAW: Right.
LISTNUM 1 \l 11335 THE CHAIRPERSON: So maybe you could explain to me ‑‑
LISTNUM 1 \l 11336 MR. SHAW: One of the things that, you know, I could see by having, let's say, two BDUs, no more than two BDUs ‑‑ so you couldn't be a telephone, a cable and a satellite, right?
LISTNUM 1 \l 11337 THE CHAIRPERSON: Good.
LISTNUM 1 \l 11338 MR. SHAW: So let's say you are two. Each operate fairly separately now anyway because they are quite different businesses. One relies on retail and different promotions. One has digital phone, one doesn't. One has really good internet, one can barely do internet, you know, because it takes up so much capacity.
LISTNUM 1 \l 11339 If you had ‑‑ let's just talk out here. If you had the satellite companies and they went together, just for an example, you would have a lot of capacity that would come back on, for innovation, satellite delivery products, internet, maybe a phone product on the satellite for rural Canadians.
LISTNUM 1 \l 11340 You would have a lot of things happening because you would have this system where you had ‑‑ okay, you wouldn't have all the duplication. Right now, everybody runs with the same thing, okay. So like even when you look at, say ‑‑ let's just use Rogers and Shaw. They basically have the same stuff on everywhere.
LISTNUM 1 \l 11341 And what kind of innovation do we get out of a region? Sure, there is going to be some things but if you had a national satellite guy, you could come up with channels and different products for consumers in Canada that would be totally within the realm of the system and support well.
LISTNUM 1 \l 11342 So I think that some of these things can drive more, you know. I am just trying to be serious here.
LISTNUM 1 \l 11343 THE CHAIRPERSON: Okay.
LISTNUM 1 \l 11344 MR. SHAW: But drive more.
LISTNUM 1 \l 11345 THE CHAIRPERSON: I will pass the baton to my colleague. Ron.
LISTNUM 1 \l 11346 COMMISSIONER WILLIAMS: Good afternoon, Mr. Shaw and Shaw panelists. Welcome to Gatineau.
LISTNUM 1 \l 11347 I think we are all aware that there is an upcoming proceeding dealing specifically with BDU issues. However, I think it is important that we get your views on this issue of diversity of voices and this will require some questions that may also seem more appropriate to a BDU process simply because you are a BDU and so those are the types of answers that only you can provide.
LISTNUM 1 \l 11348 I would like to begin by exploring the balancing act between free competition and consumer choice versus democracy, access to information and an informed citizenship.
LISTNUM 1 \l 11349 How best can we achieve these goals in Canada from a big picture point of view?
LISTNUM 1 \l 11350 MR. BISSONNETTE: You know, our behaviour is driven by our customers. We have customers that, in fact, represent every voice that you can imagine and those customers are asking us for services that have a bearing on their lives.
LISTNUM 1 \l 11351 For example, we have ethnic services in Vancouver that represent the ethnic population in Vancouver, whether it is Chinese, Asian. We have Native services that we carry across all of our systems, whether it is the Star Choice BDU, we have Native radio services. And those just don't happen.
LISTNUM 1 \l 11352 They happen because our customers say we want you to be our provider and as a part of that relationship, we would like certain things to be delivered to our home by you.
LISTNUM 1 \l 11353 We always know that the implicit corollary to that is if you don't deliver them and somebody else is prepared to do that, that that will, in fact, drive a change in the relationship. That affects our behaviour.
LISTNUM 1 \l 11354 Every day, our customers are asking for more services. They are now asking for more high‑definition services. They are asking for more packaging flexibility. I mean they have a voice in driving the way that we behave as a BDU. That is what happens in a market‑driven society.
LISTNUM 1 \l 11355 We were talking about if our company owned 30 different specialty services. The fact is that each of those specialty services is unique in its makeup, whether it is trying to attract yourself to a family organization, a family programming, whether it is how to do it kind of programming.
LISTNUM 1 \l 11356 The different genres create the different voices and so we believe that if we act in a way that is consistent with what our customers are asking us to do that the voices are then well represented.
LISTNUM 1 \l 11357 COMMISSIONER WILLIAMS: Thank you for that.
LISTNUM 1 \l 11358 Do you think there is a strong link between diversity of voices and the diversity of BDU ownership or is that an issue? What is your view on that?
LISTNUM 1 \l 11359 MR. BISSONNETTE: We think that we contribute to the diversity of voices through our ownership. Through Shaw's ownership, we own a satellite company and we own cable companies in Western Canada, and to the extent that if you look at our lineups, you will see that there is a diversity. A broad, broad diversity of everybody that is represented in Canada is reflected in the services that we offer our customers.
LISTNUM 1 \l 11360 COMMISSIONER WILLIAMS: And so is diversity of BDU ownership an important thing that we should be thinking about, or does it matter? Can the BDUs all consolidate?
LISTNUM 1 \l 11361 MR. BISSONNETTE: We don't think it matters.
LISTNUM 1 \l 11362 What matters to you also matters to us, because they both make business sense, and if we are not adhering to our customers' many voices, asking for many choices, then somebody else will fill that void.
LISTNUM 1 \l 11363 MR. SHAW: A good example is when ExpressVu put on ‑‑ I forget, what is that East Indian channel ‑‑ and the Chinese one out in Vancouver, and we weren't carrying it, and we were losing guys like crazy.
LISTNUM 1 \l 11364 A lot of the market forces drive a BDU, because the BDU is there to please. You are a customer pleaser. You are just there to try and help facilitate anything that customer wants.
LISTNUM 1 \l 11365 So the diversity of a BDU ‑‑ and we are all competing with the same channels ‑‑ we don't think it's an issue at all. We will have every channel on that we can, as long as we have space.
LISTNUM 1 \l 11366 If we don't have space, we are hoping that technology will increase so we have more space.
LISTNUM 1 \l 11367 We are putting in what is called APS ‑‑
LISTNUM 1 \l 11368 MR. BISSONNETTE: APSK.
LISTNUM 1 \l 11369 There is a perfect example, actually, of two BDUs working cooperatively to expand the diversity of choice.
LISTNUM 1 \l 11370 Next week, in all of our smaller systems ‑‑ we have 450 MHz of spectrum in some of those systems, and we are trying to expand it. We have found a technology that is available, that works on our satellite company, so that we can use our transponder space more effectively to provide APSK modulation in our small cable system, which allows them to launch 20 high‑definition channels, which a year ago they couldn't possibly do.
LISTNUM 1 \l 11371 That was a very cooperative engineering solution to add more choices for our customers in regions that heretofore could not get that type of exposure.
LISTNUM 1 \l 11372 MR. STEIN: The other point is that it is not just limited to BDU competition. What drives what we do for our customers is driven by the other media alternatives they have, whether it is through the internet and services like U Tube, or whether it is iPod services for music.
LISTNUM 1 \l 11373 That environment is very rich, and drives us to the kind of choices that we have to give to people, because of the range of alternatives that come from other media sources, and that is a fact of life over the next number of years.
LISTNUM 1 \l 11374 So having a strong BDU, and being able to serve in that way and provide choice in that way, is really important as we go forward over the next number of years, just to deal with the other media.
LISTNUM 1 \l 11375 COMMISSIONER WILLIAMS: And you feel that many of the existing rules impede your ability to offer this choice that your customers are seeking?
LISTNUM 1 \l 11376 MR. STEIN: Yes, absolutely. We put "Scream" on, and then we had to take it off because it was a Corus service.
LISTNUM 1 \l 11377 There are some other services that we would like to put on that we can't because of the 5:1 rule.
LISTNUM 1 \l 11378 The pay audio rule means that we have to carry two pay audio services, which Bell ExpressVu does not have to have, and that takes up scarce capacity.
LISTNUM 1 \l 11379 So, yes, the rules inhibit, and they also become a checklist, whereby you can't change things around or do it.
LISTNUM 1 \l 11380 We are considered to be kind of a rogue distributor in North America because we give people "pick‑and‑pay". At a time when the FCC is trying to get cable companies to unbundle their programming services, it is something that we run into trouble for, because we don't. We give people a pick‑and‑pay environment, and I think that's really important.
LISTNUM 1 \l 11381 Being a strong BDU allows us to be able to do that.
LISTNUM 1 \l 11382 COMMISSIONER WILLIAMS: In your written presentation, at paragraph 2, you spoke of "expanding the ability of distributors to provide programming choices enabled by technology, demanded by consumers, and available in a competitive market, is by far the most important step the CRTC can take to maximizing diversity of voices in the broadcasting system."
LISTNUM 1 \l 11383 Can you expand on that a bit?
LISTNUM 1 \l 11384 MR. SHAW: We are looking for the expansion of choices on a couple of different fronts.
LISTNUM 1 \l 11385 One, I drive around all of our systems ‑‑ and you guys probably do it here in Ottawa ‑‑ and I see people that have three or four dishes on the roof. Some might subscribe to cable. They have a couple of legal ones ‑‑ they have everything.
LISTNUM 1 \l 11386 So we are really wanting to utilize everything, and a lot of it is, a lot of times, product that we need, and we are trying to work with everybody on new VOD products and all sorts of stuff to take advantage.
LISTNUM 1 \l 11387 We are going to launch a new 100 megabyte internet service right away. We have a whole bunch of new products.
LISTNUM 1 \l 11388 We have movies being downloaded over our system all the time.
LISTNUM 1 \l 11389 You have all sorts of issues around the BDU.
LISTNUM 1 \l 11390 It's just so we can be innovative and creative, and support the broadcasting system.
LISTNUM 1 \l 11391 Ken, would that be fair?
LISTNUM 1 \l 11392 MR. STEIN: In terms of the Broadcasting Act ‑‑ and I know that the Chairman talked about the fact that if we got rid of all the rules, we wouldn't be able to achieve the objectives.
LISTNUM 1 \l 11393 That's not our point. It's not that there isn't a need for rules, it's that there is not a need for micro regulation. Having certain rules, like preponderance rules ‑‑
LISTNUM 1 \l 11394 Being able to have more discretion in terms of how we provide service to our customers is really the kind of situation we have.
LISTNUM 1 \l 11395 We support the Broadcasting Act objectives, it is just that we feel the system would be ‑‑ we think the system would be stronger in terms of getting rid of subsidies and getting rid of content controls and requirements. We think it would be stronger.
LISTNUM 1 \l 11396 We are westerners, so we look at the transportation system. One of the greatest things about the transportation in western Canada used to be the Crowsnest rate. Finally, we got rid of it, and the transportation system is a lot stronger.
LISTNUM 1 \l 11397 You get locked into models that say "The world can only work this way," but whether you are looking at wine, or railroads, or textiles, Canadians become much stronger when they become much more competitive, and where the regulator supports them becoming much more competitive, and being able to meet their customers' needs without having the encumbrance of too much micro regulation.
LISTNUM 1 \l 11398 COMMISSIONER WILLIAMS: Some have suggested that the BDUs would, in fact, be gatekeepers to the broadcasting system.
LISTNUM 1 \l 11399 How would you respond to that?
LISTNUM 1 \l 11400 MR. SHAW: There is no doubt that the odd time we have some fairly serious negotiations, but we have always been able to come to reasonable terms.
LISTNUM 1 \l 11401 We are there to serve the customers, too. We are kind of in the middle.
LISTNUM 1 \l 11402 We are going to ask a certain thing from a programmer. If they can help us with this, like make us a commercial every month, or do this ‑‑ and we are probably going to argue about the rate for a bit, and then, boom, we get her done.
LISTNUM 1 \l 11403 Once we put it on, we at Shaw, only if there is no viewership, have not taken any services off.
LISTNUM 1 \l 11404 I think we took one off that, out of 3.2 million customers, had 42 subscribers.
LISTNUM 1 \l 11405 We need the space for things that people want.
LISTNUM 1 \l 11406 If you only have 42 subscribers, you are going under anyway. It's just a matter of time.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11407 MR. SHAW: Really, I think, Michael, that we have come to terms on pretty well everything. I am not saying that we don't negotiate; we do, but we have been able to resolve just about everything across the board.
LISTNUM 1 \l 11408 I can't think of anything outstanding.
LISTNUM 1 \l 11409 Michael...?
LISTNUM 1 \l 11410 MR. D'AVELLA: No, and we are dealing with, for the most part, some fairly large players that have a lot of programming services that you actually need as a competitive BDU. You can't not offer certain types of services. So they are not without their own leverage.
LISTNUM 1 \l 11411 As Jim points out, we are getting deals done.
LISTNUM 1 \l 11412 We don't have the luxury of being a gatekeeper in a competitive environment.
LISTNUM 1 \l 11413 COMMISSIONER WILLIAMS: So, essentially, in this world of choice, you really don't have a choice, in that you need all of these products in order to make your business work.
LISTNUM 1 \l 11414 MR. SHAW: You know, SaskTel is coming at is. We have Manitoba Tel. Then we've got the legal guys. We've got ExpressVu. Star Choice is coming at the cable guys. Rogers is offering home phone service in our area.
LISTNUM 1 \l 11415 We have things coming at us everywhere.
LISTNUM 1 \l 11416 We want to be able to offer every product we can to keep that customer.
LISTNUM 1 \l 11417 They don't usually leave a lot of the time on price, but they will leave for a product.
LISTNUM 1 \l 11418 Let's say ‑‑ I don't know ‑‑ I will say this because André is here ‑‑ the Family Channel. If we didn't have the Family Channel and the guy beside us did, it just wouldn't work.
LISTNUM 1 \l 11419 We could argue a little bit about the rate, but there is no doubt we are carrying Family Channel.
LISTNUM 1 \l 11420 COMMISSIONER WILLIAMS: André is here.
LISTNUM 1 \l 11421 MR. SHAW: Yes, I know he is. I saw him at the back.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11422 COMMISSIONER WILLIAMS: Under Item 5 in your written presentation you wrote:
"After many years of a highly protective approach, the system and programming services are strong enough now to benefit from a rebalancing of the objectives to increase the focus on consumers." (As read)
LISTNUM 1 \l 11423 What do you mean by increasing the focus on consumers?
LISTNUM 1 \l 11424 What would be an example of your efforts to do that that is being held back now by the existing rules?
LISTNUM 1 \l 11425 MR. BISSONNETTE: We gave you one, which is really the Star Choice community programming. It is a very simple one to understand.
LISTNUM 1 \l 11426 We have a desire to offer community programming ‑‑ a national community programming service that would be indigenous, if you will, to Star Choice, that would create some competitive advantage for Star Choice, and, by virtue of the rules, we can't do that.
LISTNUM 1 \l 11427 COMMISSIONER WILLIAMS: All right. Let's spend a bit of time on the rules from your presentation this afternoon.
LISTNUM 1 \l 11428 Starting at the last half of page 9, the list begins ‑‑ and I think we talked about the first one, eliminating the structural separation rules.
LISTNUM 1 \l 11429 Perhaps we could go through the next 8 or 9.
LISTNUM 1 \l 11430 Tell us, what would be the resulting impact of the removal of each one of those that would be more favourable to consumers and to your company, and, at the same time, not be harmful to the other parts of the system?
LISTNUM 1 \l 11431 MR. STEIN: I will start.
LISTNUM 1 \l 11432 You are saying that the structural separation rules would be dealt with?
LISTNUM 1 \l 11433 COMMISSIONER WILLIAMS: Well, no. We spoke about it a little earlier ‑‑
LISTNUM 1 \l 11434 MR. STEIN: Do all of them?
LISTNUM 1 \l 11435 COMMISSIONER WILLIAMS: Yes.
LISTNUM 1 \l 11436 MR. STEIN: I can take them one‑by‑one.
LISTNUM 1 \l 11437 The structural separation rules ‑‑ in fact, what we are saying is, they are not required. Star Choice competes with Shaw. As Jim pointed out, Star Choice has 40 percent of their customers in western Canada ‑‑
LISTNUM 1 \l 11438 COMMISSIONER WILLIAMS: May I interrupt for a second?
LISTNUM 1 \l 11439 Does Star Choice offer a different program offering than the Shaw Cable offering?
LISTNUM 1 \l 11440 MR. SHAW: They have a few changes. They have a couple of different rules, so they can package a bit differently.
LISTNUM 1 \l 11441 MR. BISSONNETTE: Because of their national licence, they carry some French services specific to the Quebec market, as well ‑‑
LISTNUM 1 \l 11442 COMMISSIONER WILLIAMS: That Shaw wouldn't have.
LISTNUM 1 \l 11443 MR. SHAW: Yes, we wouldn't have.
LISTNUM 1 \l 11444 MR. BISSONNETTE: There are a couple of specialty services that they carry that are not carried on cable, but, other than that, they are fairly similar.
LISTNUM 1 \l 11445 MR. STEIN: There are two distinctions. The first is that Star Choice is totally digital. All of its services are digital, so it doesn't have the analog kind of issues to deal with.
LISTNUM 1 \l 11446 The second thing is, it is loaded up with the CBC's. So, as you go through your Star Choice Guide, the first 12 channels are all the same program. It's not really diverse, but that's the way the system works.
LISTNUM 1 \l 11447 So there is that situation, but that wouldn't change by the structural separation rules. The structural separation rules, basically, ensure that ‑‑ which we do ‑‑ you keep separate information with respect to negotiations, with respect to SRDU services and that type of thing.
LISTNUM 1 \l 11448 The key issue in that is, those rules weren't necessary. We didn't make a $1.25 billion investment to not compete. We made that investment in order to be competitive, in order to provide services to rural and remote areas.
LISTNUM 1 \l 11449 So, if anything, the structural separation rules have, in my view, hampered the ability of Star Choice to be competitive in the marketplace.
LISTNUM 1 \l 11450 THE CHAIRPERSON: Sir, you have to explain this. How do you compete if you go to rural and remote customers?
LISTNUM 1 \l 11451 They are not being serviced right now by Shaw, so you are providing complementary services, but where does the competition come in?
LISTNUM 1 \l 11452 MR. STEIN: In small markets. Certainly there is lots of competition in smaller markets, and in urban markets.
LISTNUM 1 \l 11453 Jim pointed out that, in Vancouver, people would go to a satellite choice if we weren't able to provide the kind of ethnic services they would want on cable.
LISTNUM 1 \l 11454 So it is competitive.
LISTNUM 1 \l 11455 THE CHAIRPERSON: Do you compete on price with yourself?
LISTNUM 1 \l 11456 MR. SHAW: They have totally different structure pricing.
LISTNUM 1 \l 11457 They compete, totally, in a whole different package range. They have more packaging flexibility, as I understand it, across the board.
LISTNUM 1 \l 11458 They are 100 percent digital, so their quality is probably ‑‑ I will say just a little bit better.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11459 MR. SHAW: But that's a big selling feature.
LISTNUM 1 \l 11460 MR. BISSONNETTE: They also have a retail presence. They are in every Radio Shack in Canada.
LISTNUM 1 \l 11461 So accessibility to a Star Choice product is virtually the same, for instance, as ExpressVu. In any Radio Shack you go into, you can get it.
LISTNUM 1 \l 11462 People buy Star Choice, also, as a matter of course if they are going in to buy a high‑definition television. And depending upon the biases of the salesperson, they could end up buying Star Choice or ExpressVu or a cable box.
LISTNUM 1 \l 11463 MR. SHAW: I guess, when you look at it, you would have to say that if you have two companies ‑‑ let's take Star Choice and ExpressVu ‑‑ that have got 2.4 million customers in Canada, I would say that's pretty competitive.
LISTNUM 1 \l 11464 But they compete. We don't block them or anything. It's like a full‑on thing.
LISTNUM 1 \l 11465 All we are saying is, we have looked at this now, it is seven years old, they have done really well ‑‑
LISTNUM 1 \l 11466 I don't know why they have to be structurally separated and this and that. If you want to do it that way, that's okay.
LISTNUM 1 \l 11467 We are just saying that you asked us about BDU competition, and there is tons.
LISTNUM 1 \l 11468 MR. STEIN: In terms of the existing distribution and linkage rules for Category 1, as Roger Tassé said when he did the ethnic review, just a maze.
LISTNUM 1 \l 11469 It is difficult to go through the Category 1, Category 2 definitions which were supposed to be transitional but now have become permanent. And, you know, when you get into artificial distinctions between what an analogue service and a digital service is, and this particularly applies on the cable side, it doesn't apply on the satellite side of course.
LISTNUM 1 \l 11470 But, you know, we just feel that in terms of having a simple preponderance rule that you carry a majority of Canadian services is sufficient. Now, in fact, we carry most, there are very few services that we don't carry. But the ability to get away from those kinds of carriage rules we think would be really quite important. And we would get away from things like dual status basic ‑‑ I mean, the Commission, you know, the decision on basic digital which we, you know, appeared at the hearing and disagreed with, but the Commission decided to go ahead with that.
LISTNUM 1 \l 11471 But we do believe that more and more we can drive to offering customers choice on both analogue and digital is really important.
LISTNUM 1 \l 11472 COMMISSION WILLIAMS: So when you say offer, and in all of your written presentations offer is kind of italicized in the type, what specifically do you mean by offer? Like, would the 9(1)(h) rule apply, for example?
LISTNUM 1 \l 11473 MR. STEIN: Well, that is part of the box we are all in, the 9(1)(h) rule is there
LISTNUM 1 \l 11474 COMMISSIONER WILLIAMS: Okay, all right.
LISTNUM 1 \l 11475 MR. STEIN: And I think that the rule is there to be applied. You know, we may disagree on what it should be applied to. I would, you know, doubt that I would call Newsworld and RDI 9(1)(h) services, but that is your decision, not mine.
LISTNUM 1 \l 11476 MR. FERRAS: If I could jump in, Ken.
LISTNUM 1 \l 11477 I think one thing we are saying is we are just trying to get the rules to a place where we can provide more flexibility for the distributor to serve customers, provide customers more choice and also provide the programming services a reasonable degree of access rights. The situation we have with the rules right now is very historic, as we all know. But it prevents us, for example, having a little tier or a little theme pack that might have three U.S. services and only one Canadian. So we are just looking for some flexibility to serve the market in a more consumer‑driven manner.
LISTNUM 1 \l 11478 COMMISSIONER WILLIAMS: So in a consumer‑driven manner do you envision a customer can come in and say I want services one through 25, and the next person may want an entirely different set and there is no like a concept I guess of basic cable will have disappeared and that it is you create your own basic? Is that where you are heading towards?
LISTNUM 1 \l 11479 MR. STEIN: No, I think we recognize that there would be a basic cable package. We are talking about choice beyond that. Yes, that is absolutely what we are talking about.
LISTNUM 1 \l 11480 MR. SHAW: We actually get a lot of complaints from people going well, you know, you put six channels in there, but I only watch two and I pay for six. And then so they phone us up and they complain a lot about that. You know, I think that we have come to the thinking that there will always be a strong analogue component of cable for a ways to come yet, given that everybody has second sets, third sets, one in the bedroom, one in the kids' room. And so there will be digital boxes in there, but that will be on the main viewing item or one of the TV rooms, right.
LISTNUM 1 \l 11481 MR. BISSONNETTE: Yes. And to that end, in fact, next week when we expand the capacity for our smaller systems at the same time we are also making them all digital, so it will be a total digital line‑up. So if customers want to have the small digital, low‑cost digital terminal, they can get all of their signals in digital. And if they want to have an analogue service they still have the analogue service.
LISTNUM 1 \l 11482 And so it is just a matter of finding the balance, how big should the analogue service be and then, beyond the analogue, how much flexibility should we have? And our customers tell us we should have a lot of flexibility in providing the rest of those services to them. We do that now with all of our digital services. We say there is 32, if you want to take one, two, five, any combination of the 32, you can do that, and our customers love it. So if you look at the array of services that are available to our customers and the ones they actually take, it is really hard to find a sort of common theme amongst our customers because they have different choices.
LISTNUM 1 \l 11483 COMMISSIONER WILLIAMS: And this same thinking doesn't extend to basic cable? Does your company receive complaints about the way the basic package is structured?
LISTNUM 1 \l 11484 MR. SHAW: We receive complaints about a lot of things. But no, I don't think it is too bad. You know, we are a little nervous about some of the new mandatory below 22 moves that are going to be forced on us here that I think ‑‑ what is it called, Crossroads?
LISTNUM 1 \l 11485 MR. STEIN: OMNI
LISTNUM 1 \l 11486 MR. SHAW: OMNI, and so we are going to have to bump some channels out which is really really rough. But that is not really an issue for satellite as much as it is for cable, just given the nature of how the plan is set up and how we are established.
LISTNUM 1 \l 11487 So when we take out a channel that has probably been there for 10 years and put in, you know, the Crossroads network, you know, we are thinking there might be a few issues. I don't know about you, but I am. I think I will go away that week probably.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11488 MR. STEIN: After he signs the letter.
LISTNUM 1 \l 11489 MR. SHAW: Yeah.
LISTNUM 1 \l 11490 COMMISSIONER WILLIAMS: Let us talk about new media. You state, "It cannot and should not be regulated." Can you elaborate on that statement a bit?
LISTNUM 1 \l 11491 MR. STEIN: I think it comes to a fundamental view that we have that establishing good Canadian content will come on a competitive basis. We have been asked this question many times by ministers, etc. about, you know, how do we develop Canadian content for the internet and encourage that in terms of our media? And we think that those kinds of developments come out of a competitive industry. And the more we focus on developing a competitive content industry in Canada that those things will develop.
LISTNUM 1 \l 11492 So we think that is the better approach. We also think that trying to deal with iPods and other kinds of arrangements will be tricky. But, you know, you do have a proceeding on new media, there is consultations that we have been invited to and we will participate in those and there will be lots of discussions about it.
LISTNUM 1 \l 11493 But I think we start from premise from the beginning that competition and responding to the market and consumers is always a better route than regulation.
LISTNUM 1 \l 11494 COMMISSIONER WILLIAMS: Okay. Now, I am nearing the end. I have a couple more questions. In your written presentation, under item 31, you ended that paragraph with a statement there:
"The Commission, however, continues to shelter programmers from competitive challenges. To do so will only ultimately weaken these services, alienate consumers and turn Canadians away from the broadcasting system." (As Read)
LISTNUM 1 \l 11495 Can you describe what you mean by sheltering the programmers and what we should do about that situation?
LISTNUM 1 \l 11496 MR. STEIN: Yes. I think that mandatory rules are essentially the one issue that we would take exception to. And that the rules put in place, to have to carry them in particular ways and in particular packages, is the one of biggest concern to us. You know, the programming industry has become very very strong and that is great, and so now we believe that commercial negotiations will be the much better way to go and we would all be able to respond to the market.
LISTNUM 1 \l 11497 And that finally, I mean, Shaw came under a lot of criticism over the last number of years because everybody said well, you know, your digital programming subscribers aren't as high as others. And we would say, well that is because we give people a choice. So we don't think we should be penalized for that.
LISTNUM 1 \l 11498 We think that pick and pay environment was what we always talked about for the last 15 years, digital offers the capability to do that. And we think it is unfortunate that there are decisions taken to force digital customers to take services. We don't think that should be the case. We think that digital should offer choice and that as long as there is a preponderance of Canadian services there that would meet the objectives set out in the Act.
LISTNUM 1 \l 11499 COMMISSIONER WILLIAMS: Thank you, Mr. Stein. Thank you, Mr. Shaw and Shaw panellists. That concludes my line of questioning, Mr. Chair.
LISTNUM 1 \l 11500 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 11501 Michel.
LISTNUM 1 \l 11502 COMMISSIONER ARPIN: Thank you, Mr. Chair.
LISTNUM 1 \l 11503 I want to pick‑up on part of the discussion you had with Ron Williams earlier where you stated that, yes, you are a gatekeeper, but when it comes time to negotiate with the service providers, then they have market power and, at the end of the day, we find the middle point and we come to some kind of an agreement. But you were saying that in the context of the major player.
LISTNUM 1 \l 11504 What do you have to say to this Commission regarding the small independent speciality operators, those who have only a single signal, those who are asking us not to touch the BDU regs because we are their sole protection? Do you have any comments to make?
LISTNUM 1 \l 11505 MR. BISSONNETTE: Well, you know, just recently, Mr. Commissioner, we launched I think it is called The Fight Network and they are a single, they are a small little programmer and we didn't launch them because there was any regulation we had to launch them, we launched them because they have programming that our customers said they would be interested in seeing.
LISTNUM 1 \l 11506 And they are now out there and if they are to flourish as an individual programmer it will be based strictly on what the number of consumers who watch their services are prepared to pay for them. So we have given them their exposure and we were quite happy to because our customers said they would really like to have that genre of programming and now they have it.
LISTNUM 1 \l 11507 MR. SHAW: I think the other thing that we look at and we say to them is that really we are looking for a partnership with them and that we are willing to pay you a fee, which is we come to an agreement on that, we don't really gate keep, we just come to an agreement and that process usually just takes a few months. Lots of times we will ask them to see their programming ahead of time just so we know what we are dealing with and where we want to package or how we could do it. Sometimes they are different on Star Choice than they are on Shaw.
LISTNUM 1 \l 11508 We also ask them to ensure that not all the money comes from us and that they are all entitled to advertise and they have to do their work too. So it is just not where you get to come to the BDU and he goes, okay here, give me 60 cents a month and that is it. And then you say, well how much advertising revenue you got? Oh no, I am 98 per cent cable revenue. Well, so he does no work on programming, he does not work on anything and so it doesn't really work and so it is not really a partnership.
LISTNUM 1 \l 11509 But I think that we can prove to you in every example that we have been able to come to an agreement and there has not been any gate keeping.
LISTNUM 1 \l 11510 MR. BISSONNETTE: Some other examples are GoldTV which was a strictly for soccer kind of audience, you know, youth soccer and international soccer, Casino Gaming and Television Network, the World Fishing Network, all kind of representative of what you have described as being a small independent kind of producer that has no market power. But what they do have is they have something that our customers want.
LISTNUM 1 \l 11511 MR. SHAW: They are on now.
LISTNUM 1 \l 11512 MR. BISSONNETTE: Yes, and they are all on. You know, we have launched all of those in the last six months. So it was a matter of us negotiating something that made sense to them and to ourselves and now they have that exposure.
COMMISSIONER ARPIN: When it comes time renew existing service, those who have been there for the last 15 to 20 years and are still owned by the small operators, and there surely are a few of them, are they benefiting from the same type of climate when it comes time to renew their agreements?
LISTNUM 1 \l 11513 MR. SHAW: Probably even actually better, because they would have exposure. And at Shaw and our group of companies we made a ‑‑ I mean, the only service that I can remember we removed was a Nashville network from the U.S. and we had more protests around our offices. They were picketing and walking around and stuff. We made a conscious decision that we will not be removing a service. And so basically I think we can also show you that in every instance that has not been an issue.
LISTNUM 1 \l 11514 They actually have more power once they are on. It is before they are on where they probably don't have as much. Once they are on, they have tons.
LISTNUM 1 \l 11515 THE CHAIRPERSON: How do you know your customers want this? You keep saying, we have to put it on because customers want it. How do you know that customers want it when this hasn't been shown yet? I mean, is there a catch‑22 here?
LISTNUM 1 \l 11516 MR. BISSONNETTE: Well, it is not. I mean, our customers are really not shy about telling us what they want or what they don't want. We ask them, in fact, what they would like to have. Are there services that we aren't carrying that you would like to have? You know, it is being a part of the environment.
LISTNUM 1 \l 11517 We know that there is categories or genres of programming that they say they would like. Fishing is one genre that, you know, we know there are Canadians, they love to go fishing and we know that that is a popular service. Many times the programmers themselves will come to us and say, we have done a survey of Canadians and there is a genre of Canadians that have been underserved and our service in fact would fill that kind of a need. And that gives us enough information to do some more surveying.
LISTNUM 1 \l 11518 MR. SHAW: Or they go, you know, I was out at my friend's out at EastLink in Halifax and I saw this new fishing channel or on ExpressVu the other day this happened or now SaskTel and ManitobaTel are carrying it.
LISTNUM 1 \l 11519 A good example of this is CoolTV, where we said we weren't carrying it and MTS put it on. And I think we put it on within a week or two and said: You know what, we gotta pick it up, boys. And so we started looking at all our networks.
LISTNUM 1 \l 11520 So really, it comes from the competition between all the BDUs all throughout the thing. I mean the demand for U.S. product or foreign product comes mainly from illegal and black satellite.
LISTNUM 1 \l 11521 And people are not scared to tell us what they think anymore. I mean they just come in, they phone in, you know: I would like the Punjabi channel and how come, you know ‑‑ I can't think of another name of another channel but it is channels generally.
LISTNUM 1 \l 11522 So it happens very, very quickly now where the consumer goes: Well, how come I can't have it and why don't I go to that other provider? So then right away, the pressure is really on us.
LISTNUM 1 \l 11523 THE CHAIRPERSON: Any other questions?
LISTNUM 1 \l 11524 COMMISSIONER ARPIN: Yes, my last one at least.
LISTNUM 1 \l 11525 Mr. Bissonnette, in your oral presentation ‑‑ well, as an introductory remark, I will say that throughout the presentation today you spoke at length about the support that you are bringing to the broadcasting system now.
LISTNUM 1 \l 11526 Today in your oral presentation, you mentioned that Shaw has invested over $4.5 billion in expanding capacity and facilities.
LISTNUM 1 \l 11527 How much of it was for distribution versus internet and telephony?
LISTNUM 1 \l 11528 MR. BISSONNETTE: A good portion of it would be upgrades to expand channel capacity. I will give you an example again of just what has happened in the last year.
LISTNUM 1 \l 11529 You know, there is always a service and reliability factor to the business we offer our customers and as we expand our capacity, the demands of loading on the system become more and more apparent, and so in order to minimize that loading, we have to make smaller and smaller node sizes so that customers are less impacted by active devices.
LISTNUM 1 \l 11530 So one of our objectives in the last year has been to make our node sizes smaller so the service and the reliability goes up, expand our channel capacity so that we can offer more services, look for other modulation techniques such as APSK, 256 QAM ‑‑ these are technical terms that they tell me mean something ‑‑ which gives us the capacity to carry more and more HD services or more standard definition services.
LISTNUM 1 \l 11531 So most of those dollars are spent in infrastructure for a variety of ‑‑ to expand capacity, service reliability. Yes, some of it has something to do with the internet because we use the same pipes.
LISTNUM 1 \l 11532 MR. SHAW: I guess the other thing that I would add is when you look, the majority would be for what I will call digital or broadcast services. Every digital box we sell, we lose money. Every one. On one, I think we break even but all the others, we lose money on every digital box that goes out.
LISTNUM 1 \l 11533 And when we go the node size helps all our internet traffic is carried on one channel, Peter, or two?
LISTNUM 1 \l 11534 MR. BISSONNETTE: It is on two. We have Doxis traffic and we have what was the old proprietary traffic, which we are moving away from.
LISTNUM 1 \l 11535 The other thing you have to remember is the better we do on the internet, the better the programmers are because those customers stay with us instead of going somewhere else. So the relationship is becoming a more complex relationship because it is based on more and more stepping stones.
LISTNUM 1 \l 11536 The last stepping stone, of course, was our telephone product. If we screw up that telephone product, we risk not just losing a telephone customer, we risk losing the internet customer, we risk losing a digital customer, and once that customer leaves with all those boxes and terminals, they are hard to get back.
LISTNUM 1 \l 11537 So we really are committed to ensuring that the imperatives reliability and choice are the two that drive our relationships with our customers.
LISTNUM 1 \l 11538 And then time to service. When a customer calls us, one of the things that has really helped us if we can serve you tomorrow or the next day at the latest. It is all about that relationship.
LISTNUM 1 \l 11539 COMMISSIONER ARPIN: Well, thank you, Mr. Chairman. Those were my questions.
LISTNUM 1 \l 11540 THE CHAIRPERSON: Thank you.
LISTNUM 1 \l 11541 Stuart, you have another question?
LISTNUM 1 \l 11542 COMMISSIONER LANGFORD: Yes, just one. I was thinking as I listened to Mr. Stein's wish list of regulations he wants to get rid of, I was kind of remembering George Bush's response to terrorism with shock and awe and I guess Mr. Stein's response to regulation is Shaw and awe.
LISTNUM 1 \l 11543 THE CHAIRPERSON: Ahhh!
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11544 COMMISSIONER LANGFORD: It is too bad you don't own a newspaper, it would be a good headline.
LISTNUM 1 \l 11545 I just want to focus on one because it seems to me there is still a side of this that I am a bit uneasy about, despite the fact that you have come in here and you are all wearing white hats, you are going to do everything for the customer and you are going to do everything for diversity.
LISTNUM 1 \l 11546 Even assuming that I am sold on everything you have said, there is one aspect to this that bothers me and so I want to focus on the elimination of the five‑to‑one rule, which seems to me to be the purest form of where you might be doing what you think the customer wants, you know, a perfectly sound business plan, but somebody might get suspicious, some programmer might get suspicious that you are favouring a related programmer over them.
LISTNUM 1 \l 11547 With this rule gone, what relief can they seek, what remedies are open to such a programmer that might feel, well, I got the short end of the stick here, they put on a Corus product and they didn't put me on?
LISTNUM 1 \l 11548 MR. STEIN: Well, first of all, there are very few that we don't have but I would say an ex post approach is probably the best in those circumstances and you do have undue preference rules which we aren't questioning. So we would think there would be a full opportunity to discuss somebody's situation if they felt that we were giving undue preference to somebody else.
LISTNUM 1 \l 11549 But it wouldn't be in our interest to do that, quite frankly. Our interests are to make Shaw Cable and Star Choice work really effectively and give the services to our customers that they want. So it just doesn't arise in the discussions.
LISTNUM 1 \l 11550 COMMISSIONER LANGFORD: Well, you like the free market, so if it is ex‑post, let us make a deal here, see if I can deal with you, you guys like to make deals.
LISTNUM 1 \l 11551 It seems to me that the problem with the undue preference rules is, first of all, they are a bit slow and maybe that is our fault but we have to follow all the rules of natural justice and we have to get the paper out and we have to hear from both sides, and in the end the most we can say is stop doing that, be good, you have been naughty, it is time to be nice.
LISTNUM 1 \l 11552 Would you support if we were to wipe out the five‑to‑one rule and rely on undue preference, would you support giving us greater remedies there, maybe some fining powers if you were bad, maybe some sort of remedial powers where we compensated people?
LISTNUM 1 \l 11553 If we really found you had broken the rules or the spirit of the rules, if you weren't the good guys you say you are here, would you support us on the other side of the equation having some stronger remedies?
LISTNUM 1 \l 11554 MR. STEIN: It is a deal.
LISTNUM 1 \l 11555 COMMISSIONER LANGFORD: Excellent! Thank you very much.
LISTNUM 1 \l 11556 That is my question, Mr. Chair.
LISTNUM 1 \l 11557 THE CHAIRPERSON: Okay, let us quit while we are ahead.
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11558 THE CHAIRPERSON: I think that is it for today.
LISTNUM 1 \l 11559 MR. JOHNSTON: Mr. Chairman, could we discuss the size of the fine?
‑‑‑ Laughter / Rires
LISTNUM 1 \l 11560 COMMISSIONER LANGFORD: Think big like Alberta, wide open spaces.
LISTNUM 1 \l 11561 THE CHAIRPERSON: Madame Boulet, would you announce for tomorrow please?
LISTNUM 1 \l 11562 THE SECRETARY: Yes. Thank you, Mr. Chairman.
LISTNUM 1 \l 11563 Just reminding our viewers, our listeners and people in the audience that we will start at 8:30 tomorrow morning. Thank you. Goodnight.
‑‑‑ Whereupon the hearing adjourned at 1553, to
resume at 0830 on Tuesday, September 18, 2007 /
L'audience est ajournée à 1553, pour reprendre
à 0830 le mardi 18 septembre 2007.
REPORTERS
____________________ _____________________
Johanne Morin Monique Mahoney
____________________ _____________________
Sue Villeneuve Sharon Millett
____________________ _____________________
Jennifer Cheslock Madeleine Matte
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