ARCHIVED -  Transcript of Proceeding

TRANSCRIPT OF PROCEEDINGS BEFORE

THE CANADIAN RADIO-TELEVISION AND

TELECOMMUNICATIONS COMMISSION

SUBJECT:

Policy proceeding on a group-based approach to the licensing of television services and on certain issues relating to conventional television

HELD AT:

Outaouais Room

140 Promenade du Portage

Gatineau, Quebec

November 25, 2009

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.

Canadian Radio-television and

Telecommunications Commission

Transcript

Policy proceeding on a group-based approach to the licensing of television services and on certain issues relating to conventional television

BEFORE:

Konrad von Finckenstein   Chairperson

Michel Arpin   Commissioner

Len Katz   Commissioner

Rita Cugini   Commissioner

Elizabeth Duncan   Commissioner

Suzanne Lamarre   Commissioner

Timothy Denton   Commissioner

Candice Molnar   Commissioner

Stephen Simpson   Commissioner

ALSO PRESENT:

Jade Roy   Secretary

Stephen Millington   Legal Counsel

Valérie Dionne

Jeff Conrad   Hearing Manager /

HELD AT:

Outaouais Room

140 Promenade du Portage

Gatineau, Quebec

November 25, 2009

- iv -

TABLE OF CONTENTS

   PAGE / PARA

PRESENTATION BY:

Canadian Conference of the Arts   1916 /10793

Aboriginal Peoples Television Network   1953 /11018

Canadian Association of Community Television Users and Stations   1983 /11169

ACTRA   2001 /11290

Alliance québécoise des techniciens de l'image et du son   2045 /11531

   Gatineau, Quebec

--- Upon resuming on Wednesday, November 25, 2009 at 0904

10787   THE CHAIRPERSON: Good morning. Bonjour.

10788   Commençons, Madame la Secrétaire.

10789   LA SECRÉTAIRE : Merci, Monsieur le Président.

10790   Before we start, for the record, I would like to announce that Newfoundland Broadcasting informed us that they will not be appearing at the hearing today, and also l'ADISQ will not be appearing today but on Friday.

10791   So we will start the day with the Canadian Conference of the Arts.

10792   I invite Mr. Alain Pineau to make his presentation. Monsieur Pineau, vous avez 10 minutes pour faire votre présentation.

PRESENTATION

10793   M. PINEAU : Je vous remercie.

10794   Bonjour, Monsieur le Président. Bonjour, Mesdames et Messieurs les Commissaires.

10795   Mon nom est Alain Pineau. Je suis le directeur général de la Conférence canadienne des arts.

10796   Depuis près de 65 ans, la CCA est le forum national des arts, de la culture et du patrimoine. Près de 600 organismes, artistes, organismes gouvernementaux, et activistes culturels sont membres de la CCA et contribuent à son travail au sein de la société canadienne.

10797   À ce moment-ci, je vais prier les membres francophones de votre panel de me pardonner. Des considérations de temps et de ressources feront que je ne puis procéder à ma présentation qu'en anglais. Il me fera, cependant, plaisir de vous répondre en français.

10798   Because broadcasting is the dominant cultural medium and since the Broadcasting Act contains the most complete expression of cultural policy ever adopted by Parliament, the CCA has participated actively in CRTC processes for decades, including on several occasions in the past four years as the Commission agenda accelerated.

10799   I am delighted to be at these hearings because it gives the voice of Canadian arts and culture a chance to be heard above the din created by the unseemly schoolyard brawl that has erupted between Canada's cable companies and major broadcasters.

10800   The current massive advertising campaigns worth hundreds of thousands of dollars are spreading misinformation to Canadian citizens, and I would say particularly the one run by the BDUs, from our perspective.

10801   I guess the one positive aspect of this campaign is that some of the ads are being placed on over-the-air stations and this gives them much needed revenues.

10802   However, in this climate it may be difficult for all of us to remember what this process is all about.

10803   For CCA, put simply, it is this. With the Broadcasting Act as our guide, we are here to discuss, first, how effectively the broadcasting system is meeting the requirements of the Act to provide Canadians with a variety of Canadian programs that will "inform, enlighten and entertain" them.

10804   The role of over-the-air television broadcasters, now consolidated into several large companies, in making these programs available to us locally and nationally. Are they, as the Act stipulates, meeting their obligation to make maximum and in no case less than predominant use of Canadian creative and other resources in the creation and presentation of programming?

10805   Finally, we are here to talk about how can the necessary resources to make these programs be mobilized and specifically what is the appropriate contribution that each element of the system should make to the creation and presentation of Canadian programming?

10806   Mr. Chairman, the Canadian broadcasting system is not broken but it is completely out of balance at the present time and it is urgent for the CRTC to act as quickly as it can to restore some equilibrium.

10807   How is it out of balance?

10808   First of all, private English-Canadian broadcasters spend more money on their foreign programs than on their Canadian programs. This is something we have denounced in front of you several times over the past three years and it may well be a violation of the Act.

10809   English-speaking Canadians do not have sufficient access to drama, scripted comedy and long-form documentary programming that speaks to their lives.

10810   Over the years and particularly recently we have also witnessed a serious decline in the supply of local news and information programming.

10811   We have no Canadian arts programming on our conventional television channels, which still, however, reach a larger part of viewing.

10812   In the fact of the worst economic recession in 75 years, Canada's BDUs made more than $2 billion in profit last year, while conventional broadcasters struggled to break even. There is, indeed, something amiss when the distribution systems bring in more money than the organizations responsible for providing the content.

10813   As we have said in previous appearances before you, we have little sympathy for English conventional broadcasters because they have brought many of the problems on themselves by overpaying for U.S. programs and using a massive amount of debt to finance their consolidation.

10814   Between 2004 and 2008, revenues of private English broadcasters increased by 3.4 percent. In the same period, their spending on U.S. programs went up by 35.3 percent and they were using Canadian dollars that depreciated in value by 5.5 percent between 2004 and the end of 2008. They were clearly unprepared when the economic recession stalled their revenue growth.

10815   We fully share with the production community as well as the broadcasters the position that overall there are insufficient resources available for the production of high-quality programming of all kinds, both local and national, and this protracted process must address this shortfall.

10816   The networks continue to attract large audiences and billions of dollars in advertising and other revenues. In 2008, despite the emergence of the Internet, Canadian still spent an average of 26.6 hours per week watching television.

10817   As Canada emerges from the recession, we know that revenues of over-the-air broadcasters will begin again to grow, albeit modestly. They need to be prudent but they also need to fulfil their responsibilities under the Act and it is your duty as stewards of the Act to make sure that they do.

10818   Your responsibilities are specifically to use all the tools at your disposal, including regulation, to make sure Canadians have access to homegrown quality programming, as ordained by Parliament. If the market cannot deliver on that front, Parliament has mandated you to intervene. This has been your historical role.

10819   With respect to the central issue you are examining in this particular hearing, CCA supports a corporate group-based approach to licensing television services for the following reasons:

10820   It would simplify the administrative burden on licensees.

10821   It would more accurately reflect the manner in which broadcasting groups acquire the rights to and schedule programs. It is now standard practice for a company to obtain rights for all of their broadcasting assets, from over the air to specialty services.

10822   It would allow everyone to consider the role of Canadian programming across all services owned by the same company. Additionally, we could examine how effectively the company uses the Internet to extend the reach of its CanCon.

10823   Even more importantly, since Canadian content CPE and exhibition requirements are minimums, it would provide an opportunity for broadcasting groups to differentiate themselves from their competitors by selectively acquiring and scheduling additional CanCon for their more successful services.

10824   In arguing for regulatory flexibility in earlier years, I have heard in this very room broadcasters talk about how Canadian content would be to their competitive advantage in the world of 500 channels. They were right, although they didn't follow through, but that remains true today.

10825   In response to the various ideas put forward by the Commission and interveners, we urge the Commission to adopt the following approaches to CanCon for each licence group.

10826   First, maintain the existing spending and exhibition requirements for specialty and discretionary services, updated as appropriate. These are working, both for the broadcasters, who are making money, and for the system since they are providing good-quality Canadian programming choices and successful internationally in some cases. Maintaining existing requirements also respects the competitive licensing process.

10827   Second, impose a Canadian programming expenditure requirement of 30 percent of gross revenues on CTVglobemedia, Canwest Global and Rogers. We have to begin to return some balance between spending on Canadian programming and spending on non-Canadian programming.

10828   Third, impose a specific minimum CPE of 6 percent of gross revenues for drama and scripted comedy on all English-language broadcasting groups. This spending is also part of their overall CPE. This is the programming genre most underrepresented in the system and the most essential for cultural reasons. The Commission has already acknowledged the shortcoming.

10829   Fourth, impose a requirement on each over-the-air broadcaster to schedule at least two hours each week of drama or scripted comedy in the 8:00 to 11:00 time slot, Sunday to Friday, calculated quarterly. A quarterly calculation would prevent broadcasters from loading drama into their summer schedules when fewer people are watching television and they spend less on promotion of Canadian programming.

10830   We will look to the Commission to determine the appropriate phase-in period for these obligations during the next licence term for each broadcast group.

10831   Now, to talk dollars.

10832   In this era of constricted revenues, the argument of the broadcasters has changed and they now claim that CanCon is a money-losing burden imposed on them by the Commission, an albatross around their neck.

10833   But thanks to the Nordicity study filed in this process by ACTRA, the Writers Guild, the Directors Guild and CFTPA, we can all see now that broadcasters can make money on their investment in Canadian content programs. What they need to do is to work at it to amortize the cost of the useful life of a program across all of their services.

10834   The Commission must no longer be silent when broadcasters try to claim that they lose money on Canadian drama, scripted comedy and documentary shows. We have the talent to produce high-quality programs when we put the means to it and we can sell them and promote them.

10835   Of course, broadcasters can make more money on high-quality and popular U.S. programs which are dumped into Canada but this study debunks the myth of CanCon being a drain on broadcaster resources.

10836   There is money to be made in Canadian content. This is where the laws of the market should apply. People should work for it.

10837   Let me conclude my opening remarks by reviewing two other matters.

10838   CCA has a significant concern about one element in the trial balloon you floated in your potential regulatory model included in the Notice of Consultation. CCA would vigorously oppose any reduction in the requirement that conventional broadcasters schedule at least 60 percent Canadian content across the broadcast day.

10839   CCA submits that this regulation is perhaps the single most important Canadian cultural policy and the cornerstone of our television production industry. It is the model for all other audiovisual content quotas around the world. Although it could certainly be better implemented, it has achieved its fundamental purpose and it remains as relevant today as it was when it came into effect in 1972.

10840   While the framers of this policy may have hoped that the quote would eventually become irrelevant because Canada's broadcasters would be routinely exceeding it with high-quality Canadian programs in every genre, the fact is that after almost 40 years this quote remains a maximum CanCon level, not a minimum at all.

10841   And surely, Canadians have already sufficient access to foreign programs on our television screens in 2009 without increasing the supply available to them from their own domestic services.

10842   We can see no justification whatsoever for reducing this historic benchmark which has been so important in the development of our society.

10843   Finally, we want to wade into the debate about the money required to ensure that the cultural objectives of the Broadcasting Act are achieved.

10844   In our view, the CRTC has already laid the foundation for solving the local programming problems with the creation of the Local Programming Improvement Fund. We would, however, like to see the cable contribution increase to 2.5 percent as recommended by all parties in the June 2009 House of Commons Heritage Committee Report.

10845   They added also that a 1 percent contribution should be specifically designated for CBC/Radio-Canada and we fully support that recommendation from parliamentarians.

10846   We have also tabled our support for a payment by the BDUs to conventional broadcasters to compensate for the distribution of their signal, provided this revenue is directed to the production of Canadian programming. This is an integral part of our recommendation about the appropriate level of CPE.

10847   But we want to be absolutely clear: We do not support a television tax, as the BDUs have cunningly labelled the value-for-signal proposition you have put forward.

10848   Rather, we say that Canadians already pay substantial subscription fees for cable and satellite services, not to mention that we indirectly pay for the television advertising which is so important to broadcasters. Canadians already pay enough but we do not receive a sufficient return on our cultural investment in the form of Canadian content programming.

10849   The CRTC must rebalance the system to make sure that an appropriate amount of our subscription fees finds its way onto our television screens. If this requires you to re-regulate cable rates, then so be it. The cable companies will have nothing to blame for it but their own greed.

10850   And, of course, as mentioned previously, we also urge you to bring back regulation to ensure that broadcasters themselves fulfil their obligation with regards to Canadian programming.

10851   In concluding, we invite you to be courageous. If you take the strong actions that are necessary to rebalance our broadcasting system and use the tools that the legislator has given you to ensure that the cultural objectives contained in the Broadcasting Act are met, we know that Canadians will support you.

10852   Thank you for your attention. I look forward to your questions.

10853   THE CHAIRPERSON: Thank you very much for your submission.

10854   You added something to your presentation this morning which I tried to write down but I couldn't write as fast as you talk. Maybe you can repeat it to me.

10855   On page 6 in the middle you say:

"Your responsibilities are specifically to use all the tools at your disposal, including regulation, to make sure Canadians have access to homegrown quality programming, as ordained by Parliament."

10856   And then you ad libbed: If Parliament doesn't appropriate the money, it is your historical role to -- and I ran out of space there. What did you say?

10857   MR. PINEAU: I am sorry, I am on page 6 and you are saying...?

10858   THE CHAIRPERSON: After the third paragraph, you ad libbed. You said: If Parliament doesn't appropriate money, it is your historical role to achieve this objective through regulatory methods or something like this.

10859   MR. PINEAU: Okay. The paragraph starts: "Your responsibilities are specifically..."?

10860   THE CHAIRPERSON: After that paragraph.

10861   MR. PINEAU: Yes. Just at the end, before --

10862   THE CHAIRPERSON: Just now when you read --

10863   MR. PINEAU: -- with respect to --

10864   THE CHAIRPERSON: Yes.

10865   MR. PINEAU: Okay. What I said was that if the market cannot deliver -- you know, if market operations -- let me find the context here for this specific one.

--- Pause

10866   MR. PINEAU: Yes, the system. If the market cannot deliver a system that works for the production of Canadian content, there is a need for regulation. That is why the CRTC has been -- and that is what I said. If the market cannot deliver on that front, on the front of producing -- of giving access to Canadian -- equality programming to Canadians, then Parliament has mandated you to intervene. You know, market rules will not apply. You need regulation and policies.

10867   THE CHAIRPERSON: This is where I have problems with your whole presentation. Two things that you strongly advocate -- and it is clear that we should do everything possible to implement the Broadcasting Act. Obviously that goes without saying. But you basically ignore the market.

10868   You have heard evidence here before us saying that advertising runs the system, the advertising pays for the broadcasting system, and the key is to get that advertising money, which you only get if you have popular programs which people want to watch.

10869   MR. PINEAU: Yes.

10870   THE CHAIRPERSON: We have heard over and over all the evidence saying that Canadian programming, as much as there is an aspiration for it and a want for it by Canadians, it doesn't pay for it.

10871   The Nordicity study shows it pays for it in the long run but certainly not as well as running U.S. programming and making money right away.

10872   And secondly, the players in the market are commercial corporations who obviously want to maximize their profit. So why should they go for the lower-return Canadian content rather than the higher U.S. content?

10873   I mean since advertising drives the system and we want their returns to be used for CPE, et cetera, you have to have the revenue in the first place.

10874   MR. PINEAU: No. What we are telling you is that we have to step back. I mean when we use the word "broadcasting" it is unfortunately, you know, tainted historically in its meaning. It is a problem that we are grappling with currently, even in definition.

10875   I chair the Advisory Committee of Cultural Statistics at Stats Can and we are reviewing categories of how we are going to measure and report. And "broadcasting" is a word that is really difficult to use in order to describe the system and what we are inviting the Commission to do is to step back.

10876   The conventional TV broadcasting system as we know it, which is now a minor part of the -- well, no, not a minor part but a part of the system, that needs fixing but from the overall system and we are asking you to step back and say the overall system is not based entirely on advertising. Advertising is a component of it. Advertising goes to other places in the system that are progressively more and more integrated in ownership. We need to step back and have an overall vision.

10877   THE CHAIRPERSON: What is the other part of the system?

10878   MR. PINEAU: Sorry?

10879   THE CHAIRPERSON: What is the other -- you said advertising is part of the system but not all of it. Where are the other sources of revenue?

10880   MR. PINEAU: Parliament. Parliament subsidizes through its granting system the production of Canadian programming. Copyright is part of it also. All the elements in the system and subscription fees. I mean subscription fees are the basis here. Some specialty services have them, others don't. Okay. It evolved historically that way.

10881   Let's look at the overall picture. What are the objectives of the Act? Produce Canadian broadcasting of quality. Are we giving up on that, if that is what you are saying, because there is not enough advertising revenue for current broadcasters, who could increase it if they worked at it. Canadian programming, that is in my mind what the Nordicity study establishes.

10882   THE CHAIRPERSON: But aren't we trying to get a marriage between a competitive marketplace and the objectives of the Broadcasting Act, and rather than going the route that you suggest with re-regulating cable rates, mandating output, mandating this, et cetera, what we have been trying to do over the last 10 years is exactly the opposite, trying to make sure that we regulate a competitive market so it produces the outcome but taking away as much of the regulation as possible in order to allow the system to generate as many resources as it can for the purposes that --

10883   MR. PINEAU: I am sorry, I don't follow you. I mean the criteria here at hand, first and foremost, are cultural, at least in my mind, and that is the Act. The other one is the market conditions under which these things are produced. We have to have a mixed system.

10884   You have acknowledged yourself that we need regulation in Canadian television. We are saying the system is broken, both in terms of the resources for it and the obligations attached to it.

10885   THE CHAIRPERSON: But my problem with your suggestion is that it is basically return to yesterday, and the fact is the market has changed and the underlying infrastructure has very much changed. We now don't only have a broadcasting system to deliver television programming, we have an alternate system, as I have been saying like a broken record all week long, the Internet and wireless.

10886   The last thing we want to do is push people away from the Canadian broadcasting system into a system that we do not control and which is clearly not dominated by Canadian content.

10887   MR. PINEAU: We have been saying also for 10 years, and maybe we were a bit premature 10 years ago -- 12 years ago, I think. It was before my time when the CCA intervened here to say that you should consider regulating the Internet. It was probably not a bad thing that you waited. We are still advocating that you should regulate the Internet, in broad terms.

10888   We need to step back and look at the whole system. I mean it is part of the strategy of broadcasters. I mean the Internet has to be part of it, otherwise they will get swallowed up by it.

10889   But there is enough consolidation of ownership in our system, which has been advocated for for the past 15 years to allow it to happen, that it would give us the economic clout to face competition and produce quality programming, and you are telling me that all those businessmen in the competitive market are unable to deliver and they failed.

10890   THE CHAIRPERSON: No, I am not saying that at all. I am saying that they are fully aware of what is going on and that -- for instance, you say on page 7 of your paper:

"In arguing for regulatory flexibility in earlier years, broadcasters used to talk about how Canadian content would be to their competitive advantage in the world of 500 channels. They were right, although they didn't follow through, but that remains true today."

10891   Well, they didn't follow through because it turned out that that is not the way to maximize income. I mean that is just the point.

10892   MR. PINEAU: Yes, but --

10893   THE CHAIRPERSON: They are living in a competitive world and they obviously try to live up to the regulatory obligations that we impose upon them but at the same time maximizing their income. And that also works to our advantage because the more income they generate, the more there is for the programming that we want to foster.

10894   MR. PINEAU: Yes, but the point I am trying to make here is that it is their responsibility to maximize their income and they are doing good at it. They could do better, according to the Nordicity, if they had established what has not existed in English Canada because you could rely on cross-border programming in the same language to entertain Canadians and you were cashing in on your licence to distribute that.

10895   I mean let's face it, those empires were not created on Canadian programming. They were always created with a perspective, with a promise, with the engagement, with all the words that they could possibly muster to say that they would deliver on Canadian programming. They don't. Well therefore, sorry, we have to regulate. I mean it is their responsibility to maximize their income, it is not yours.

10896   THE CHAIRPERSON: No, absolutely, but I want them to be healthy so they can deliver Canadian programming. I don't want them to go dark.

10897   MR. PINEAU: And that is why we are supporting that broadcasters get revenue from the distribution system because currently the fat cats in the system in our book is the distribution system. I mean we have all the evidence there. And they are selling me my wireless stuff by selling me Canadian content, but yet -- cultural content, not Canadian content. No, no way.

10898   But, you know, I mean look at the advertising of this, look at the use of these gadgets. Even I at my age have converted to it because I have access to cultural content that I didn't have before. I can walk to the office now and listen to Internet radio stations that deliver what I want if I don't find it locally.

10899   They are making money out of this, out of the cultural service that they provide, and they are not contributing to Canadian content, Canadian programming. Well then, let's rip up the Act.

10900   THE CHAIRPERSON: Don't you realize the contradiction in what you just said?

10901   MR. PINEAU: There may be one -

10902   THE CHAIRPERSON: You have access to international content, and that is exactly the point. That is why we have to find a way for them to produce Canadian content and still profit, because the alternatives are there that weren't there before.

10903   MR. PINEAU: I'm sorry, I fail to see how I contradict myself, because I had access to this. That doesn't mean that if I had access to good Canadian content - and I do, actually. The NFB is on this, and CBC is on this, for whatever cultural content I can still get there, and so on.

10904   I have access to it, but we are there to provide choices - oh, that's another part of their vocabulary. They are there to provide choices to consumers.

10905   We are just saying, yeah, provide Canadian choices as well, and promote them. That's why you are supposed to have access to the frequencies. That was the basis of the system. Where have we lost our way?

10906   THE CHAIRPERSON: I can see -

10907   MR. PINEAU: I'm sorry, I preach.

10908   THE CHAIRPERSON: No, we are having a spirited debate, and obviously we have different points of view.

10909   Just one last thing before I pass you over to my colleague. You are advocating that 6 percent goes to revenue for drama and scripted comedy. Does that include documentaries or not?

10910   MR. PINEAU: I'm sorry?

10911   THE CHAIRPERSON: On page 8, point 3 -

10912   MR. PINEAU: Yes?

10913   THE CHAIRPERSON: -- the 6 percent, you say, is for drama and scripted comedy.

10914   Normally people throw documentary into that same pot. Do you feel that the 6 percent should apply to documentaries as well?

10915   MR. PINEAU: Quite frankly, I hadn't thought of it, but I wouldn't - I mean, I hear my constituency in documentary who say that that would be a wise choice.

10916   THE CHAIRPERSON: Okay, thank you.

10917   Len...

10918   COMMISSIONER KATZ: Thank you, Mr. Chairman.

10919   Good morning, Mr. Pineau.

10920   MR. PINEAU: Good morning.

10921   COMMISSIONER KATZ: I have several questions, some of them may be repetitive because you have taken a very, very similar view to how to strengthen the system as has the Writers Guild and the CFTPA, and in my reading of ACTRA and the Directors Guild, they are also on the same page -

10922   MR. PINEAU: Yes.

10923   COMMISSIONER KATZ: -- so we are going to be a bit repetitive here, I'm afraid, but I think it will provide us with an opportunity to clarify some of the issues and flesh them out, as well.

10924   MR. PINEAU: I will answer your questions to the best of my possibilities, which are limited.

10925   COMMISSIONER KATZ: On page 4 of your remarks this morning you basically talk about the strength of the BDUs, and you actually refer to $2 billion of profit last year, while conventional broadcasters struggled to break even.

10926   I am trying to understand the comparison that you are trying to make. Is it just the BDUs and the video component of their business?

10927   They have come before us in the last week and basically said: Look, we are not making money on the video component.

10928   Or, when you say "Canada's BDUs", you are looking at everything else they operate, as well, including wireless and telephony services and internet - everything?

10929   MR. PINEAU: Yes.

10930   And, of course, I am not saying that - I am not suggesting anything, actually, as to what portion of that should be ascribed to -

10931   In a previous hearing, you will probably have heard, or will find, on regulating the internet, that there was a study by Peter Grant that was tabled with the Commission that referred to an evaluation.

10932   To the best of my knowledge, this is the only document of that kind, or research that I have seen, that would establish the proportion of wireless services and internet service providers at about 50 percent.

10933   That is the only piece of information that I have had access to on this particular front.

10934   COMMISSIONER KATZ: But you are drawing a comparison of the breadth of the communications industry in Canada to the narrow component of conventional broadcasting, without even considering that the conventional broadcasters have migrated and expanded into specialty, as well, and I am trying to understand -

10935   MR. PINEAU: Not all of them, sir.

10936   COMMISSIONER KATZ: Not all of them.

10937   MR. PINEAU: Not all of them; they were not allowed. Some of them were not allowed. The CBC was not allowed. That was CRTC government policy in the seventies and eighties.

10938   COMMISSIONER KATZ: But since that time they have been allowed, they are into -

10939   MR. PINEAU: Yes, they have picked up what was not commercially workable for others. They came here under partnerships, because that was the only way to get a licence at the CRTC for the specialty services, if you were in the CBC. I know, I was in Regulatory Affairs at that time.

10940   So we went through a series of partnerships and everything, and then, when it was no longer financially viable, they were allowed to do it as another platform, and you have changed the formats since of some of them.

10941   COMMISSIONER KATZ: But if we look at the private broadcasters today -

10942   MR. PINEAU: Yes, and not all of them have them, either.

10943   COMMISSIONER KATZ: All of the larger ones do.

10944   MR. PINEAU: Yes, not in French Canada.

10945   COMMISSIONER KATZ: The larger ones in French Canada do, as well, I believe.

10946   MR. PINEAU: Well, yes, one news service, I think. I am not - I'm sorry, I won't argue with you.

10947   COMMISSIONER KATZ: The comparison you are trying to make - I guess I am wondering whether, when the Commission looks at the conventional broadcasters, do you believe that we should be looking at the conventional broadcasters in addition to the other assets that they have, as well?

10948   And that includes, obviously, specialty.

10949   MR. PINEAU: Yes. We have been saying across a number of hearings that - and I am repeating myself here today - we have to step back and stop looking at this part of the engine, or that part of the engine, or that part of the engine that is not functioning, looking at it with this sort of microscope.

10950   This is the time to step back and look at the whole car, and if the solution for what is broken in this little chunk here is in another part of the system, let's go and get it.

10951   COMMISSIONER KATZ: Okay, but the comparison - and you are agreeing with me that what we should be looking at is the Canadian communications system as a whole -

10952   MR. PINEAU: Yes.

10953   COMMISSIONER KATZ: -- run by the BDUs, and the broadcasters as a whole, run by the broadcasting community.

10954   MR. PINEAU: There is a convergence of technology.

10955   What was it - four years ago the Liberal government commissioned a study of the telecommunications sector, and the report was tabled under the current government in 2006 or 2005 - I can't remember.

10956   And it was not part of their mandate, but they said: With the convergence of technology, it will become more and more impossible to separate the Telecommunications Act from the Broadcasting Act.

10957   Our concern - and we share that opinion, however complex the issue is. But rather than see the dismantling of the Broadcasting Act piece by piece, without looking at the big picture - it being swallowed by the Telecommunications Act, just like a galaxy would swallow another one, is something that is not fair.

10958   The cultural objectives are in the Broadcasting Act.

10959   So if we have to step back and look at the whole system, yes, let's do it.

10960   COMMISSIONER KATZ: Who else should be involved in looking at the whole system, besides the CRTC?

10961   MR. PINEAU: This is a political debate. Essentially, it's a political debate at the end of the day, and we have every party wading in here, through a process that is sort of in chunks and pieces, because you are still trying to -

10962   I think I heard the President, or I read about the President saying: We have to look at the big picture. We are trying to find -

10963   And, in a way, with all due respect, that is what I have witnessed over the past three years. I have been coming here on a regular basis. I feel like St. John the Baptist coming out of the desert.

10964   COMMISSIONER KATZ: We heard TELUS yesterday suggest a national digital strategy, and that's not the first time we have heard it. Are you and your constituency in support of having a review of the national digital opportunities -

10965   MR. PINEAU: Oh, absolutely. Absolutely.

10966   Actually, we are trying to provide whatever resources we have in this. We have to have a broad debate. We are late. We are late.

10967   But, there again, it is starting in bits and pieces. It's like we couldn't get a heart beat, just sort of random electrical signals in the system.

10968   COMMISSIONER KATZ: Let me drill this down a bit more to the nuts and bolts.

10969   On page 8 of your submission you talk about imposing Canadian program expenditures of 30 percent of gross revenues on the three parties you identified here.

10970   Is there a reason why you identified these three uniquely, as opposed to others?

10971   MR. PINEAU: These are the big players. I think the others - the idea is that the Commission would modulate, as it does, according to the realities of the various players, but the big ones should set the standard.

10972   That is the recommendation we are making. We are not saying, "Don't regulate others," we are just focusing on the big ones.

10973   COMMISSIONER KATZ: You identify the target as being 30 percent of gross revenues. Others have come before us and suggested a percent of expenses, as opposed to a percent of revenues.

10974   Do you have any thoughts as to why you selected revenues rather than expenses?

10975   MR. PINEAU: I guess it's because it is more likely to yield more revenue to the production of Canadian programming, which is where I stand. If that's what it does, yes.

10976   If it's the reverse, quite frankly, go for it.

10977   COMMISSIONER KATZ: And does this gross revenue include the allocations from the Canada Media Fund and all of the other allocations, or is it purely revenue received from the business?

10978   MR. PINEAU: That's a question that, in all fairness to the BDUs - because, yes, I am saying that they are the fat cows in the system now, but they are an important component. We don't want to be unfair to them.

10979   I cannot answer that question specifically today, sir, I'm sorry.

10980   COMMISSIONER KATZ: Okay. I notice, as well, that you have highlighted -

10981   MR. PINEAU: My propensity, though, would be that evidence would show that it should be separated from their contribution to the Canada Media Fund.

10982   And we are also advocating, so that you know, that the Canadian government increase its share of contribution to the Canada Media Fund. It's been frozen there, at that level, for the past - I don't know - 13 years, at $100 million or so. We are inviting the government to invest more.

10983   We are not only here to go after the private sector, we are also here to go after government investment in Canadian culture.

10984   COMMISSIONER KATZ: I believe that the government allocated more money for media last year, but I am not here to defend -

10985   MR. PINEAU: No, it's just bringing funds together that existed already and were at that level.

10986   COMMISSIONER KATZ: On page 9 you come back to the notion of the Nordicity study again, and we have had the people here before us, but I noticed that you basically underlined the words: "Broadcasters can make money on their investment."

10987   In your submission on September 14th you said, "Can and do make money."

10988   So I guess you have modified that in the light of my discussions with those folks.

10989   MR. PINEAU: In some cases they do, actually. I mean, there are some -

10990   COMMISSIONER KATZ: Yes, but we are look at it en masse, in gross.

10991   MR. PINEAU: Oh, no, not in gross. But when they put their mind to it and produce a good program, hell, yeah. I mean, you know, how many times have you heard about Corner Gas here? I am sure that Corner Gas has or will make its money.

10992   When they set their minds to it, and their resources to it, we have the talent to do that sort of show, it's just that we are not employing our creators to do it.

10993   COMMISSIONER KATZ: What are your views on non-simultaneous substitution and the availability that it might provide for more exhibition of Canadian programming on prime time?

10994   MR. PINEAU: If it is going to bring more money to broadcasters, if it is not a nightmare to implement - and I am sure it's not, without knowing it - and I wouldn't trust a cable operator who would tell you that he couldn't do it - and if it brings more money to the system and is linked to conditions of licence - you know, it falls under the CPE requirements that we have made - I think we would definitely go for it.

10995   COMMISSIONER KATZ: Thank you, those are my questions.

10996   THE CHAIRPERSON: Thank you very much.

10997   Michel...

10998   CONSEILLER ARPIN : Monsieur Pineau, toute votre allocution de ce matin faisait référence à la situation de la télévision au Canada anglais.

10999   Est-ce que vous avez des observations à faire sur la télévision de langue française?

11000   M. PINEAU : Non, je n'en ai pas, si ce n'est les suivantes.

11001   D'une part, il y a une reconnaissance dans la Loi de la réalité, qui est que le marché francophone est différent. Les conditions sont différentes là. L'équilibre des joueurs est différent là aussi. Il y a des choses qui s'appliquent du côté anglais qui s'appliquent du côté français. Il n'y en a pas de l'autre côté.

11002   J'ai consulté mes commettants au Québec. Ils sont à l'aise avec le fait que je mette l'accent surtout sur le côté anglais, et je suis certain... je n'ai pas eu le loisir, malheureusement, de suivre les audiences de près, puis, je ne sais même pas s'il y a des intervenants de l'UDA ou du côté... je sais qu'il y a eu monsieur Péladeau là, puis Radio-Canada...

11003   CONSEILLER ARPIN : On a eu l'APFTQ.

11004   M. PINEAU : Oui, c'est ça, mais je n'ai pas pu suivre là. Mais eux vont... j'appuie toutes les recommandations que ces gens-là peuvent vous faire, en deux mots.

11005   CONSEILLER ARPIN : Très bien. Vous n'avez rien de spécifique. Parfait. Merci.

11006   THE CHAIRPERSON: Thank you.

11007   Elizabeth...

11008   COMMISSIONER DUNCAN: Thank you, and good morning. I just have one quick question. I want to be clear that the 6 percent for drama, comedy and documentaries is included in the 30 percent, or is it in addition to?

11009   MR. PINEAU: No, no, it is included.

11010   COMMISSIONER DUNCAN: Okay. Thank you very much.

11011   THE CHAIRPERSON: Thank you very much, those are our questions for you.

11012   MR. PINEAU: Thank you.

11013   THE CHAIRPERSON: Madam Secretary, let's proceed right away with the next one.

11014   THE SECRETARY: Thank you.

11015   I would now invite the Aboriginal Peoples Television Network Incorporated to the presentation table.

--- Pause

11016   THE SECRETARY: Appearing for APTN is Mr. Jean LaRose.

11017   Please introduce your colleague and proceed with your 10-minute presentation.

PRESENTATION

11018   MR. LaROSE: With me is Peter Strutt. He is Director of Programming, and he will be part of the presentation and will answer some of your questions, as well.

11019   Monsieur le Président, Messieurs les Vice-Présidents, et Messieurs et Mesdames les Commissaires. Mon nom est Jean LaRose. Je suis un citoyen abenaki de la Première Nation d'Odanak au Québec. Je suis ici aujourd'hui avec monsieur Peter Strutt, le directeur de la Programmation, et je vous remercie pour nous avoir permis l'occasion de venir vous présenter aujourd'hui.

11020   From APTN's perspective, this hearing is boiling down to a discussion of issues in three areas: the negotiation of fair value for over-the-air television signals; group licensing; and DTH satellite carriage and freesat.

11021   We can introduce a little humility, because we aren't in a position to comment fully on all aspects of these issues. We can only speak, and will only speak, to those aspects that touch on APTN and on our mandate.

11022   This mandate, in the broadest terms, is to create a place in Canadian television for Aboriginal peoples.

11023   We are not here as the proverbial tail to wag the dog. We recognize that the Commission is faced with some large decisions, the largest of which is what to do about OTA television broadcasters and the contribution these broadcasters have made as the cornerstone of the Canadian broadcasting system.

11024   Our goal today is to explain how the Commission's response to this fundamental matter may have an impact on APTN and our mandate.

11025   The tools that we use to fulfil our mandate may need recalibration after this hearing is done.

11026   There are two elements of the negotiation of fair value for OTA signals that are especially relevant to APTN. First, the payment of compensation for OTA signals could lead to a higher retail cost for basic service. APTN is part of the basic package, so a higher basic cost could affect us.

11027   In the past, we proposed a smaller, Canadian-only basic service. We believe that such a service continues to make sense, it would clearly be in the interest of consumers, and it would help give priority to the foundation Canadian services that provide a first level of service.

11028   If the Commission were to adopt this approach, we strongly encourage that the basic service be offered on contiguous channels.

11029   We are pleased to see that, in this proceeding, BDUs are finally acknowledging that priority placement within the basic band has a value to broadcasters. In the past, when APTN requested priority channel placement, the Commission was told that channel placement is largely irrelevant and has no value whatsoever.

11030   We do not think that a smaller basic service requires a detailed re-regulation of cable rates. The Commission has heard in this proceeding that BDUs do not believe that Canadians want a small basic service. If that is the case, then BDUs should be ready to commit to a smaller basic service at a reasonable monthly fee. After all, BDUs are adamant that consumers wish to purchase a much larger package of services. They must have the data to show that few consumers would switch to a smaller service, so BDU revenues would be protected.

11031   Also, BDUs don't have to worry about changing over every subscriber to the small basic package, as has been suggested. This is a red herring. Only subscribers that want such a package would be affected.

11032   We think that the BDUs are correct. The vast majority of Canadians want services above the basic level of service. But, having a smaller, affordable basic service would provide price guidance to consumers, and pride of place to foundation services. We see such a service as furthering the objectives of the Broadcasting Act to give priority to Canadian programming services, and on an affordable basis.

11033   The second element of the signal value question that we want to raise relates to the fact that these negotiations, it has been suggested, could be far-reaching. VOD and the use of local avails and U.S. services, for example, are just two parts of the current regulatory debate that could be put on the table.

11034   We have participated in CRTC proceedings examining these and other issues because APTN has an interest in these. APTN will not be represented in any negotiations between BDUs and the larger broadcast groups, but the outcome of negotiations has the potential to affect APTN. We would not suggest that wide-ranging negotiations between these two powerful groups should not take place. That would be the case of the tail wagging the dog.

11035   Also, in the current attack ad environment, any negotiation would be an improvement.

11036   Rather, as the Commission has suggested, any negotiated agreement will have to come back to the Commission for an evaluation of the public interest. Our point is that, once the giants have reached an agreement, and after all the celebrations have died down, we expect that there will be a need to consider some protective or rebalancing measures for smaller players in the system, and this should be a public process.

11037   In the area of group licensing, we wish to speak in terms of the principles that we support. First, group licensing conditions make good sense. It supports efficiency. It allows a broadcaster to focus resources on areas in which those resources are best spent, and to gain credit for doing so across all of its services.

11038   Second, if group licensing is more efficient, then it would allow broadcasters to make regulatory commitments that are at least comparable, if not greater than what applies now across all services.

11039   The group licensing model should include Canadian programming expenditure requirements across each group, and include OTA services. The different ownership groups do not own the same services. It makes sense, therefore, for group CPE obligations to be set separately for each ownership group, probably through the licence renewal process.

11040   MR. STRUTT: Third, group licensing should support the independent production sector. At APTN, a large part of our programming comes from independent producers. This includes our higher budget dramatic programming, which is leading the way in creating opportunities for Aboriginal peoples.

11041   A key point about these productions is that they are often multi-broadcaster projects. Because they are produced by independent producers, different broadcasters have the opportunity to buy into the project for different exhibition rights.

11042   To give you an idea of what we are talking about, our current drama programs, Rabbit Fall and Cashing In, were both created as co-productions between APTN and other broadcasters.

11043   For new productions, APTN is now working on five different dramas, with different broadcasters, representing about $8 million in new projects, featuring significant Aboriginal participation.

11044   We are concerned that if larger broadcasters have less incentive to rely on independent producers, this will lead to fewer opportunities for APTN and other smaller broadcasters to participate in these projects.

11045   As it stands now, we leverage our role in such productions to ensure meaningful Aboriginal participation. This leads directly to the creation of more, higher budget productions with Aboriginal participation than would otherwise have happened.

11046   Also, to date, apart from APTN, the independent production sector is the most important sector for Aboriginal peoples in the broadcasting system. Policy changes that diminish the role of the independent production sector will cause unintended harm to Aboriginal peoples in the broadcasting system if there is no rebalancing elsewhere.

11047   Fourth, we believe that the Commission should set CPE obligations without including licence fee top-ups from the CMF. The CMF is undergoing a change in focus toward supporting the most popular types of programming. That being the case, we don't think it is right that broadcasters that get access to the most CMF dollars because they are offering broadly based programming should, in effect, have their CPE obligations reduced through the moneys they receive from the CMF. It would be much more transparent to calculate CPE obligations without reference to the CMF.

11048   MR. LaROSE: Lastly, group licensing should continue to place material obligations on large broadcasters to create high-quality programs of national interest when Canadians watch television. From our perspective, dramatic programming and children's programming are the most important programming categories that benefit from regulatory support.

11049   In the area of satellite distribution, once again, we can only share with you our experience. APTN has benefited from a kind of freesat model that we have implemented with the assistance of ExpressVu and the support of the Northern Distribution Funding provided by the Department of Canadian Heritage.

11050   About four years ago we concluded that it was not feasible for us to continue to maintain our network of terrestrial transmitters across the north, or to upgrade them to digital. Replacing our transmitters with satellite distribution in some communities, and cable distribution in others, without charging residents to receive our service, became the objective.

11051   Admittedly, the economics of APTN's northern distribution, close to 100 transmitters in small and isolated communities, are not the same as the economics in southern Canada. Still, our experience may provide some guidance to evaluate the freesat concept.

11052   It seems to be working in the north, but it is a subsidized program.

11053   In our case, too, I would point out that our satellite program has not been, and will not be offered in cable communities, ever.

11054   Our second point about satellite distribution is that questions of satellite capacity seem somewhat malleable. As you are no doubt aware, APTN distributes three different standard definition feeds, the eastern, western and northern, and a distinct high-definition feed.

11055   APTN makes all of its three SD feeds available across Canada, using C-Band satellite services provided by Shaw Satellite. We are very pleased that Shaw supports our activities in this area through CRTC-approved expenditures on Canadian programming directed to APTN.

11056   We are also very pleased to note that ExpressVu distributes two of our three SD feeds to subscribers in the different regions of Canada. APTN also obtains satellite service from ExpressVu for the distribution of our HD feed.

11057   The majority of BDUs, in addition to ExpressVu, now distribute APTN HD, and we are satisfied with its success.

11058   APTN has been working with Shaw to find ways to offer more of our feeds, as well as the HD feed, to its subscribers. I do find it ironic that Mr. Shaw has been waiting for so long for a phone call from CTV's owners, because I have been writing and calling to try to speak to him personally about these carriage issues and about how APTN and Shaw could work better together for a couple of years now. In fact, I tried to reach him to get him to pass his best wishes to the Commission today, but unfortunately he didn't return my call.

11059   Our perspective, therefore, on the question of satellite capacity is that it is a somewhat scarce resource that satellite carriers deal with carefully, as they should. Ultimately, though, we think that it has to be up to the Commission to ensure that all Canadians are properly reflected on DTH services, and that an appropriate use is made of Canada's satellite frequencies, which are a public resource.

11060   Thank you very much for your attention. We would be pleased to answer any questions you may have.

11061   THE CHAIRPERSON: Thank you for your very measured presentation. After having heard an awful lot of self-serving evidence, I appreciate the tone of your submission.

11062   Let me talk a bit about satellite distribution. When I visited you, you told me about your northern program, and when the whole issue of conversion came up, we had a meeting of all the CEOs and the CRTC about how do we deal with digital transition, and I pointed to you and your model and said, "Why couldn't it be translated into the TV area?"

11063   You have done it, and if I understand it, you say that it is subsidized. Heritage paid for the receiver, the satellite, and the installation, as I understand it, or is there more subsidy involved than just the mere installation?

11064   MR. LaROSE: We say subsidized programming because Heritage has allowed us to use part of their annual grant to us for the northern distribution system to be used for the satellite receiver substitution program, but it is not subsidized - APTN is, in fact, covering a lot of those costs, so it is not a fully subsidized program by the Department, and it does not subsidize any of the services being offered to the homeowner.

11065   The dishes that we have purchased from ExpressVu are pre-programmed to decode APTN North only, and the homeowner, unless they sign up for additional services, at their cost, only receive APTN North.

11066   THE CHAIRPERSON: Does the homeowner pay for the installation or do you pay for it?

11067   MR. LaROSE: We pay for the installation, as well as the equipment.

11068   THE CHAIRPERSON: Now, obviously, once they are in the house, there is a great opportunity for ExpressVu to up-sell and say, "Look, you have the APTN signal. You are happy with it. Why don't you also buy TSN now or whatever else you use, et cetera, and become a regular customer?"

11069   Has that actually taken place? Have there been a lot of customers who originally signed on as ExpressVu customers -- as APTN-only customers and who then converted into regular customers of ExpressVu?

11070   MR. LaROSE: Well, the initial data that we have shows that most people who accepted the dish, because some have refused the dish all together --

11071   THE CHAIRPERSON: Yeah.

11072   MR. LaROSE: -- they wish to remain disconnected, but those who have in most cases have started off with APTN North, which is what is offered, there has been some upgrading by some various homeowners.

11073   But APTN -- neither APTN nor Telesat who is doing the installations for us, do any marketing in that area and it is up to the consumer to contact ExpressVu if they wish to upgrade. We do not market that service.

11074   THE CHAIRPERSON: No, but doesn't Bell ExpressVu advertise on that service, "Here you have an opportunity to upgrade", et cetera?

11075   MR. LaROSE: The same as they would on their usual barter channels where they have their whole range of programming. That programming is probably also decoded.

11076   I haven't looked specifically into that, but certainly the homeowner would be exposed to some of the possibility of adding packages to their basic service.

11077   THE CHAIRPERSON: And the homeowner only gets the APTN North or does he get some other channels "for free" as a means of enticing him to become a regular Bell ExpressVu customer?

11078   MR. LaROSE: I would have to look into that. My understanding is that what we have purchased with it with the receiver, is strictly APTN North decoded.

11079   I will verify if some of their advertising channels are also offered and I could report back to you in the next week or so.

11080   THE CHAIRPERSON: Okay.

11081   And what do you mean by that paragraph on page 7:

"In our case too, I would point out that our satellite program has not and will not be offered in cable communities ever."

11082   MR. LaROSE: Well, when we launched this program, at the outset APTN felt that it was critical not to be competing with the small cable operators in the north. We didn't feel it was fair to go in those communities and offer homeowners an either/or situation. You know, if you want to get a dish we will give you a dish. If you want to get a cable drop we will give you a cable drop. We felt that this would be probably quite detrimental to the smaller cable systems who are trying to develop their business.

11083   Those communities that have cable we do not offer satellite dishes. What we are doing is working with the cable -- especially the co-ops up north, Arctic Co-op and others, to connect every home in a community with a cable drop that has a filter that allows APTN North to filter through but nothing else.

11084   Again, the homeowner then has the opportunity of buying more cable service.

11085   THE CHAIRPERSON: And you don't have the same thing as we have in the general digital transition. There are certain people who are outside the cable territory who received your over-the-air signal before and who will now be without means of access?

11086   MR. LaROSE: Well, at this point we are working with the cable communities. They are obviously trying to reach everyone.

11087   There will be some residences that may not be cabled but at the same time our transmitters are fairly low power and any individuals that lives outside the current core, the area, in most cases do not already receive our over-the-air signal anyway.

11088   THE CHAIRPERSON: So that's not an issue. It obviously will be in terms of digital transmission from a general -- to television?

11089   MR. LaROSE: It will be. And what we have noticed is that as we have gone up north to do these, I think two or three years ago when I presented to the Commission I mentioned at the time that the surveys we were doing north on the North of 60 showed that about 5 or 6 percent of residences were still receiving their signal over-the-air and at the time there was an indication by about 50 percent of these that they would either get satellite or cable.

11090   That has materialized because as we go in these communities, based on the data we had back then, a lot of that data is totally out of -- it's out of date. Some communities almost every house already has a dish. In some communities we have only made one or two installations. Everybody else already had a dish.

11091   THE CHAIRPERSON: I see, okay. Thank you.

11092   Candice, over to you.

11093   COMMISSIONER MOLNAR: Thank you.

11094   Can I just clarify what you just said, 5 to 6 percent of the community were receiving television over-the-air? Is that what you said?

11095   MR. LaROSE: Yes.

11096   COMMISSIONER MOLNAR: The community that you are serving or the community at large?

11097   MR. LaROSE: The community at large. The North of 60 goes into all of the northern region. It's not Aboriginal-specific, but it does have a strong Aboriginal component.

11098   And that data showed that because it's also -- that survey was done jointly with Health Canada, INAC and some other government departments. So they had interest in the broader community, not only the Aboriginal community.

11099   And at that time only 5 or 6 percent of respondents said that they received their signal over-the-air and now I would say that's down to anywhere from 2 to 3 percent and even below 1 percent in some communities.

11100   COMMISSIONER MOLNAR: And in the southern part of Canada do you have any sense, as it relates to your target audience, what percent would receive their signals over-the-air and therefore not at this time have access to your services?

11101   MR. LaROSE: We don't have comparable data because we don't have transmitters in the south. We did, through the On Reserve survey, ask the question, but a lot of our communities are outside the range of even over-the-air signals. They do get radio but some do not get television.

11102   So in those cases it has become -- satellite has become their way of connecting to the world. And there seemed to be at the time a fairly high level of interest and take-up rate on satellite, but we don't have anywhere near the same data as we do for the north.

11103   We are hoping now that both of these surveys have been sort of set aside by the government for the next year or two, we are hoping to do -- to conduct them on our own. We are now looking at the feasibility of conducting those surveys within the next six months to a year. They will have the same questions that we asked two years ago, the last time.

11104   So hopefully by this time next year I will be able to provide the Commission with updated data in this regard.

11105   COMMISSIONER MOLNAR: Thank you. I think that would be very interesting, and I think it's particularly interesting when you say that a number of the communities are outside of the limits of existing over-the-air television today, you know.

11106   So thanks, and I will look forward to seeing that.

11107   I had read your submission and your opening comments. Clearly, you have been following the hearing over the past week and a half and I thank you for addressing some of the things you did in your opening comments. It has cut down my questions considerably. No need to ask you your thoughts on skinny basic anymore.

11108   So I would like to use your comments as perhaps my guide going through here. On page 4 you talk about the need, after all of the work is done with these large groups, to consider some protective or rebalancing measures for smaller players in the system.

11109   Could you expand a little bit what it is you mean by that, why you view that that's a necessary component?

11110   MR. LaROSE: Well, I would assume that any negotiations between both -- I will say both parties in the general term, the broadcasters versus the BDUs -- would end up in some form of settlement that probably will imply a fee of some type for the service. It is APTN's feeling that that fee will end up being passed to consumers.

11111   If it adds 10-15 percent to the cable bill, 20 percent to a cable bill, we may see an impact that the number of subscribers could drop. There could be an impact on the level of subscription across the country and APTN is highly dependent on subscriber fees. That's our main source of revenues. We have been building advertising revenues but they are still only a small percentage of our total revenues.

11112   So we believe that after these negotiations there may need to be a look at how that has impacted APTN and other smaller broadcasters as well as how that may have shifted the balance of negotiation that many of us have with BDUs.

11113   APTN is somewhat protected by having a fixed subscriber fee but a lot of the other smaller players don't have any such level. They have to negotiate their rate with the BDUs and DTH and they may find themselves in a very difficult situation if the BDUs decide to try to minimize the increase to consumers by cutting what they are paying for various services.

11114   So I think all in all it has huge ramifications from our perspective across the industry and it may mean that, depending upon that result of those negotiations, we will have to look at how do we protect the smaller players.

11115   A lot of us generate most of the Canadian programming. I would argue that APTN certainly is a very high contributor to Canadian programming. About 80 percent of our content is Canadian, if not more.

11116   So I mean we depend on the revenues we currently have to at least maintain that and not see it degrade. So we think the Commission may have a role to play afterwards.

11117   COMMISSIONER MOLNAR: So would it be fair to say that if the outcome of this proceeding -- if as a result of the outcome of this proceeding there is a demonstrated adverse impact on other players at that time there should be a public process; that it isn't just a natural follow up to this but if there is demonstrated evidence, at that time there needs to be a public process?

11118   MR. LaROSE: Well, I would think that I would agree with you there needs to be -- there would need to be demonstrated elements of an impact.

11119   COMMISSIONER MOLNAR: Okay.

11120   MR. LaROSE: But I think those would probably be fairly quick to happen.

11121   COMMISSIONER MOLNAR: Okay.

11122   On the issue of group licensing, in your comments you make -- you comment that you are concerned that group licensing could affect the quality of Canadian programming going forward. And I wanted you to perhaps expand on that.

11123   I think there was some sense, and some of the things we have heard through this hearing; in fact, by moving to a group-based CPE there is a potential that we can improve upon the quality and, you know, the high cost nature of production. So I was a bit surprised by your comments.

11124   Could you expand on how you view that group licensing could in fact reduce the quality of Canadian programming?

11125   MR. LaROSE: Well, I think we were looking at it in the sense that what would the impact of group licensing be if you shared, you know, your programming requirements across a variety of specialties and one or two conventionals that you may own.

11126   It's been our experience that a lot of the productions we work in partnership with other broadcasters, are not necessarily with the conventionals but with the specialties.

11127   A lot of the networks -- and Peter will be able to elaborate on -- with some of the specialties we work with, but whether it's History, whether it's Canal D, whether it's Showcase or others, that's where a lot of our partnerships and that's where we have put a lot of our resources to develop co-productions that are, we believe, high quality Canadian productions.

11128   If there is an equalization across all of these, we are not convinced that there is the same imperative for a conventional to try to create that high level of Canadian programming in primetime to compete with American programming. We rarely see it now. We don't see what would be that imperative to change that.

11129   I think that when you look at primetime most of it is American programs, American program-based, and by allowing this to be stretched over the various platforms I am not convinced that we will see an improvement in Canadian programming.

11130   I don't think there is that much of a very keen interest on the part of some conventionals to produce high-quality Canadian programming that would appear in primetime. That's, to a great extent a personal view, but certainly it's been my experience in the few short years I have been in the industry.

11131   Maybe Peter can speak to some of -- how that could impact our relations with some of the specialities with whom we work as well.

11132   MR. STRUTT: Yeah. I just generally -- in terms of partnerships we are always looking at the programs that we are putting licences towards having the largest general audience that they can generate.

11133   So when we are negotiating with the conventional broadcasters sometimes it can be -- we realize that there is opportunities missed to garner large audiences when shows are put onto their specialty networks versus a primetime placement on their larger broadcasts.

11134   COMMISSIONER MOLNAR: Would you have any suggestions as to how that concern could be addressed within a group licensing regime?

11135   MR. LaROSE: Well, I think the -- possibly the key way in which it could be addressed would be to ensure that during primetime there be created some measure of imposing a certain amount of Canadian programming, high quality Canadian programming across all the networks. I mean we see a fair amount of it on the CBC but a lot of the others during primetime is nothing more than you know the American programming that has been purchased and was playing at the same time on an American channel.

11136   And I think there would need to be something that also imposed upon the networks that balancing between the group licensing and the balancing of their obligations extend to conventional to a greater extent and also to primetime.

11137   COMMISSIONER MOLNAR: Okay, thank you.

11138   My final question relates to independent production. You have said that group licensing should support the independent production sector. Do you have some specific proposals as to what levels would be required within -- you know, as we are looking at this group licensing is it status quo, is it more, is it less?

11139   MR. LaROSE: I think it shouldn't be anything less than what it is now for independent producers. Broadcasters should be expected to at least maintain their current minimum level of production with the independent sector and possibly even increase it.

11140   From our end 80 percent of our productions are independently produced and I think that -- you know, we think that is the best way to build an industry. It certainly has worked for Aboriginal peoples.

11141   And, I mean, I'm here again to speak on behalf of the Aboriginal Peoples Television Network and our peoples. And certainly some of the partnerships that we have built with other networks have provided opportunities to Aboriginal peoples that never existed before.

11142   We have gone from about six production houses to over 75, almost 80 active producers now. A lot of them have established their own production house. They have established, you know, production centres.

11143   And I think if that was to be diminished, if there was to be any relaxation of those rules across the board for other broadcasters, certainly the relationship we have with other broadcasters to co-produce programming will possibly be less of a requirement for them and a lot of the people with whom we have helped build an industry may find themselves at a disadvantage.

11144   So certainly it should be nothing less than what the current rules are for independent productions for a broadcaster. And I would suspect that they should be increased if they are given the opportunity to spread them out across their various entities.

11145   COMMISSIONER MOLNAR: Thank you. Those are my questions.

11146   THE CHAIRPERSON: Does any one of my colleagues have a question?

11147   Elizabeth?

11148   COMMISSIONER DUNCAN: I have just a quick question, just on your comment if I understood. You wanted us to ensure or find ways to ensure that the quality of the Canadian production shown in primetime were of high quality.

11149   And I'm just wondering how would we do that? We have the profit motive because it's the best audience, the best time to sell advertising. What other measures would you suggest?

11150   MR. LaROSE: Well, when we -- and I will take APTN as an example again here. When we propose partnerships with other broadcasters we always look at proposing to them programming concepts that are you know sort of different, unique. We try not to emulate other, you know, American programming, what have you. We try to make sure that it is distinctly Aboriginal and Canadian in nature, in style and in texture, if I can use the term.

11151   I would expect that, you know, we would look at creating or at requesting that it not be sort of strictly an American format that's brought over here, an American franchise that's brought over here, emulated and copied to meet the minimum requirement for it be considered Canadian content. We would expect -- we would hope, certainly, that we start building a true Canadian industry here that can generate programming that is of interest.

11152   Some of the broadcasters have been successful, whether it's Flashpoint or other shows like that, in creating series that you know have a bit of a Canadian feel, not too much so that you can still sell it to the States, but at the same time there are other opportunities for us to keep looking at formats and ideas and develop them.

11153   Maybe Peter has something that you want to add to that?

11154   MR. STRUTT: Yeah. No, I just agree.

11155   Like recently we were -- or even last night for anybody watching our network, we were doing a battle of our pilots and some of the pilots that we are doing from Blackstone that deals with a contemporary social look at -- a dramatic view of life on reservations and also from science fiction. It's specifically Canadian shot in Toronto, looking at different genres of Canadian content that are being shown on networks that are uniquely Canadian.

11156   So I think that's where -- you know where we are coming from.

11157   COMMISSIONER DUNCAN: So probably then it would probably be -- actually, obviously in their business interests to make sure it is high quality. I mean more a business decision than it needs to be a regulated decision -- a regulated direction.

11158   MR. LaROSE: Sorry. And you are right. You are correct in that statement.

11159   When we say "high quality", I guess from the perspective of where I come from I mean something that is unique, that is in fact an attempt to create a program that is not a cookie-cutter format, for lack of a better term.

11160   COMMISSIONER DUNCAN: Thank you very much.

11161   Mr. Chairman, thank you.

11162   THE CHAIRPERSON: Thank you.

11163   Those are our questions. If you could get back to us on the question I asked you about whether those people who have signed up to the ExpressVu or northern APTN feed what else they get besides that "free" offering by ExpressVu, we'd appreciate it.

11164   Thank you. We will take a 10-minute break.

--- Upon recessing at 1022

--- Upon resuming at 1035

11165   THE CHAIRPERSON: Okay. We seem to have a secretary again. Commençons.

11166   THE SECRETARY: Sorry, Mr. Chair, and thank you.

11167   I will now invite the Canadian Association of Community Television Users and Stations, CACTUS, to make its presentation.

11168   Please introduce your colleague and yourself and proceed with your 10 minutes presentation.

PRESENTATION

11169   MS EDWARDS: My name's Catherine Edwards. I'm a spokesperson for the Canadian Association of Community Television Users and Stations, a few of you have seen me before, and Robin Jackson is with me today. She's the former Executive Director of the Canadian Independent Film and Video Fund and she's assisting CACTUS developing some funding options.

11170   The Canadian Association for Community Television Users and Stations is a bilingual national association representing community television channels and corporations that are owned by the communities they serve and the public who uses and watches them.

11171   We believe in citizen access to the airwaves and to local control of communication systems. Individual members of the public, community organizations, non-profit groups and all other entities in civil societies should be able to participate in the broadcasting system by producing programming of their own.

11172   Thank you for inviting us to appear today.

11173   As we all know, the Canadian Broadcasting System has three elements: private, public and community. It has been disconcerting in this hearing to hear community channels presented as competitors for local TV and as a competitive advantage for one type of BDU compared to another.

11174   In our view, the community sector is defined first and foremost by community control.

11175   Community channels run by private for-profit BDUs are, in fact, local channels in the private sector. The Miller Report on the business of Canadian OTA television itself refers to local channels run by BDUs as former community channels.

11176   Canada's true community sector, channels run by communities themselves, currently consist of cable cooperatives, low-power over-the-air community licence holders and not-for-profit independent community television programming corporations. Their services are carried on cable, but they're owned and operated by communities themselves.

11177   When we discuss community channels today, these are the channels that we mean.

11178   Unfortunately, these genuine community channels are accessible to only about 10 percent of Canadians today.

11179   CACTUS supports the idea of fair market value for over-the-air signals provided this compensation is linked to volumes and genres of Canadian content and provided the community sector is included.

11180   Since the main thrust seems to be to save local programming and the community sector produces more volume than any other through the genius of the voluntary production model excluding it would be illogical and unfair. As one of the three elements in the system, community channels have must-carry status on cable basic tiers, so genuine community channels should also receive compensation for their local content.

11181   It's worth pointing out that both the public and private sectors receive significant federal support for Canadian production either through tax dollars, the Canadian Media Fund or tax credits, while the community sector receives none.

11182   The Notice for this hearing asks for comments on the LPIF criteria. The idea for such a fund was first raised in the 2003 Lincoln Report which called it the Local Broadcasting Initiative Program. This program was meant to assist in the provision of radio and television programming at the community, local and regional levels.

11183   When the LPIF was announced in late 2008 it was supposed to be open to the community sector subject to the policy review of the sector, which hasn't yet taken place. The criteria that have since been set effectively exclude the community sector despite its sole focus on local programming.

11184   And there's three reasons. The first is that the allocations are based on direct expenditures on production. The programming costs for the community sector are largely donated by volunteers, their time. The core costs for our sector are in infrastructure and training and it's unclear whether these would count as direct program expenditures.

11185   Second, although the community sector clearly has local presence, in fact that's all it has, the LPIF's definition of local presence based on the production of daily news, the maintenance of a news bureau and the employment of professional journalists are all outside the model of the community sector.

11186   The LPIF's allocation on the basis of prior year programming expenditures does not consider new entrants' needs for start-up costs.

11187   Because the BDU community channels have morphed into something else -- as Peter Miller has pointed out -- this is what we need the most.

11188   Satellite carriage. We applaud Bell and Shaw for proposing models that would carry local channels on satellite, as was also recommended by the Lincoln Report and is already mandated in the U.S.

11189   Unfortunately, however, Bell's list of 40 to 45 local channels that it might carry does not include any community channels.

11190   It seems easy to overlook community broadcasting, but Parliament made it one of our system's three elements. Its absence on DTH makes the Broadcasting Act seem like lip service to us and not law.

11191   Like the CBC, true community channels must be universally accessible to be functional as an essential public service to Canadians.

11192   We recommend that this offer by Bell and Shaw gives the CRTC the chance to address this issue.

11193   The hybrid model of over-the-air broadcasting.

11194   CACTUS is concerned that the transition to digital could result in Canadians in smaller markets losing access to free over-the-air television. These Canadians also own the broadcasting system. It runs contrary to the principles of access in the Broadcast Act that they should have to pay for basic Canadian programming services that others get for free.

11195   We agree with the CMG that HD is not necessarily required or expected for local programming in markets where it might otherwise be cut altogether. Equipment can be upgraded incrementally as part of the natural replacement cycle.

11196   If digital conversion is too expensive in smaller rural markets, why not permit analog broadcasts to continue. TV sets will be sold in dual mode for some years to come and countries with similar budgetary constraints, like the U.K., have adopted this hybrid model.

11197   As for HD, equipment can be upgraded incrementally.

11198   And we suggest a simple and low-cost solution for the rural markets: for the community sector to maintain rural and small market transmission towers and equipment to distribute community TV signals and to re-broadcast remote signals from the private and public sectors at the same time.

11199   CACTUS will be proposing at the upcoming community sector hearing that community run, multi-platform access production centres be licensed and funded so that communities can one-stop-shop to get their messages out, including over-the-air.

11200   Other broadcasters could perhaps obtain a modest tax advantage by donating their soon-to-be obsolete analog equipment to communities they will no longer be serving.

11201   New community licensees could, in exchange, continue to transmit remote signals for these broadcasters.

11202   Communities themselves could incrementally upgrade transmission equipment to digital. If a community of just under the 300,000 cut-off paid just $1 per person, it could pay the one-time conversion, and this is assuming a very high estimate of costs. A community of 150,000 would have to pay only $2 per person.

11203   This is similar to the model that the CBC used decades ago to extend its own transmission systems to small communities.

11204   We are developing this business model and we look forward to sharing more details with you at the coming community channel proceeding.

11205   Please note that a key feature of this proposal requires that there be both frequency protection for community signals once licensed and at least one full digital frequency reserved for the community sector in every market.

11206   Neither of these conditions has been in effect to date.

11207   It's another example how it often seems to us that the Broadcast Act's stipulation that we are one of the three elements in the system is not taken as seriously as it should.

11208   We thank you again for allowing us to appear.

11209   While Canada is again going through a technological conversion, it's useful to remember that every technological upgrade has a tendency to eliminate access at the grassroots and local levels.

11210   For example, when broadcasters in larger centres upgraded from VHS to U-Matic, to Beta, to Digital Beta, to MPEG and then to HD.

11211   Producers in stations in smaller markets have been required to upgrade their programming offerings or risk exclusion.

11212   Technology has imposed costs on Canadians outside urban centres and we believe any new CRTC policies in this hearing or down the line should take this factor into account.

11213   Flexibility in our broadcasting system should be preserved to maximize access by all Canadians and all communities to our communication system.

11214   We would be pleased to answer your questions.

11215   THE CHAIRPERSON: Thank you for coming here and making this presentation. Obviously we'll see you in April when we have the community TV hearings.

11216   Explain to me for one second what you mean by paragraph 14. I wasn't aware that Shaw had made a proposal at all, and by the Bell proposal, I presume you're referring to the Freesat proposal?

11217   MS EDWARDS: By Bell I'm referring to the Freesat proposal and at least two other documents posted on the CRTC's website. It says that:

"Shaw Communications has come forward with similar proposals." (As read)

11218   THE CHAIRPERSON: Unfortunately, they didn't survive the passage of time.

11219   MS EDWARDS: Okay.

11220   THE CHAIRPERSON: When Shaw was here and I asked them, they didn't mention that, and they haven't proposed anything new.

11221   So, we're talking about the Freesat proposal?

11222   MS EDWARDS: Okay, yeah.

11223   It's the Freesat document that had the appendix list of local channels that might be carried. They proposed it as an example, not as a final document, but still it was a little disturbing to see that the community sector wasn't considered at all.

11224   THE CHAIRPERSON: Okay. Thank you.

11225   Okay.

11226   Candice, I believe you have...

11227   It's over to you.

11228   COMMISSIONER MOLNAR: Yes, thank you and good morning.

11229   Recognizing that there is an upcoming hearing dealing with many of the issues that your sector faces and you will be, I'm sure, very involved in that hearing, I only have a couple of questions for you this morning.

11230   I'm going to reference back to your submission, and I know you also referenced it in your remarks today.

11231   The first relates to your comments about communities should have the right to determine whether or not they'll pay the cost of conversion within their communities.

11232   And you say in your filed comments that it is likely that most -- and maybe I better, I'll restart that so you know where I'm coming from here.

"Given that the alternative is for these communities to have to start paying a BDU to see their local channels, it is likely that most would elect to pay a one-time very nominal conversion fee." (As read)

11233   MS EDWARDS: I think it says a one-time nominal conversion fee or is there a typo there?

11234   Anyway, what's your question?

11235   COMMISSIONER MOLNAR: Yeah, very nominal conversation fee is what it says.

11236   MS EDWARDS: Right, okay.

11237   COMMISSIONER MOLNAR: Yes. So, my question is whether or not you would have any evidence that that would be the case? And I ask that -- you know, you gave the example of a community with 300,000 people who would have to pay perhaps $1 per person for the conversion fee.

11238   What we do know is that approximately 90 percent of persons have access and have elected and subscribed to cable services, so those that are reliant on the over-the-air is a relatively small proportion.

11239   So, if you're talking about a community of 300,000 potentially, you know, at most 10 percent may be reliant on over-the-air, so you're then talking about 30,000. Then if you put that into the range of a household versus a person in that community, you're talking in the range of 10,000 households, at best.

11240   So, you know, I was surprised when I read that you thought it was likely that most would elect to pay the cost, and I wondered if you had any evidence, if you base that on any supporting evidence at all.

11241   MS EDWARDS: Just the general principle that most people would rather pay something once than be committed to pay a much bigger fee per month down the line for ever.

11242   We haven't prepared our own data but, for example, the presentation from Pam Ashbury from Kamloops and the surveys that have been done in Kamloops suggest that a much bigger number would go over-the-air if there was a significant hike in cable rates.

11243   And, I mean, I guess no one's going to know for sure until that happens, how many people might make that decision. But we just feel that the communities should at least get that option and not have it imposed.

11244   You know, if they decide, no, you know what, we'd rather pay the cable rates or the satellite rates, okay, great, but we think that the communities should be asked, it shouldn't necessarily be an imposed solution.

11245   COMMISSIONER MOLNAR: Fair enough.

11246   Yeah, okay.

11247   One other thing. In paragraph 4 you talk about your one-stop-shop community access centres and you suggest that -- and state that they require OTA transmission and you suggest that perhaps if some of these existing analog transmitters are taken off air that they should be donated to the community centre.

11248   I was trying to understand, as the spectrum is released for other purposes, and we have heard many who came before us with interests in wireless applications very interested in the spectrum, what is it you had planned to do with the equipment?

11249   Assuming the spectrum is released for other purposes, what is it you had planned to do with the transmission equipment?

11250   MS EDWARDS: Well, we feel that community channels should be available on whatever platforms exist moving forward, So that, you know, once upon a time cable had 80 percent roughly cable penetration, so it was fair to say that community channels at that time that were offering public access were available to most Canadians, but that's dropped, it's somewhere around 69 now and it doesn't apply so much in rural areas.

11251   The idea that there should be at least a channel available where communities can share their own information, there should be at least one where they can do that, but to reach all of them we need to have some space reserved for public use in that way on whatever platform there is, whether it's the Internet and web streaming in the future, whether it's over-the-air because that's the best way to reach people in some rural markets, whether it's satellite.

11252   That principle that some of the band width in the system needs to be reserved for community use, whatever the platform, you know, needs to be preserved.

11253   And it's an interesting thing that in Canada the community channel was only ever one channel. So, when cable came in and there were maybe around 30 channels with the original offering, one channel was community, there was one CBC, there was one provincial broadcaster, so maybe there were, you know, two channels in the public sector in each market with all the rest being private channels.

11254   In other countries that's not the way it works. In many countries there's a set percentage of band width set aside for community use, for public use so that as new platforms come online it's a recognized idea that some of that band width has got to be for public use.

11255   So, for example, the PEG system in the U.S. doesn't just have a single channel which is, you know, your local soap box for individuals, there's also one, it's called a public access channel, but it's for educational use, so universities and colleges can program them. There's another one municipalities can program.

11256   So, it's the idea that there should be part of the spectrum for community use, whatever platform.

11257   COMMISSIONER MOLNAR: Okay, thank you.

11258   MS EDWARDS: So, what would we use it for? We would broadcast programming on it created by communities.

11259   COMMISSIONER MOLNAR: All right. Just to ensure I understood what you said.

11260   When I read this I had a sense that you wanted to use the existing spectrum and that it would play a role in requiring towers and equipment that will no longer be used in the private and public sectors to be made available to the community sector.

11261   And, so, I understood that you were asking to use existing spectrum, you know, the existing equipment in the old technology.

11262   But what you're saying is moving forward in new allocations you want a space in there; is that right?

11263   MS EDWARDS: Well, we're saying both. We think that traditionally, for example, in dense urban markets there isn't currently, I'm told by Industry Canada, typically there aren't, you know, frequencies sitting around that a community licence holder could ask for today even if they wanted to.

11264   So, we feel that the transition to digital is an opportunity because we know that some of those analog frequencies are becoming available, some of the existing broadcasters have been maintaining two, one in analog, one in digital.

11265   That when those frequencies become available, I think it's 52 to 69, you know, somewhere in there, at least one should be saved for community use.

11266   So, we are saying we want to be on, yes, over-the-air as well as new technologies. We are saying that.

11267   COMMISSIONER MOLNAR: Okay. Those are my questions.

11268   Thank you.

11269   THE CHAIRPERSON: Suzanne?

11270   CONSEILLÈRE LAMARRE : Merci, Monsieur le Président.

11271   It's not as much a question as it is a comment. I'd like to draw your attention to a similarity between something you presented this morning and something that was tabled by the small market independently owned TV stations and they were with us yesterday.

11272   You're talking about the LPIF and pointing out the fact that, you know, you're programming cost is usually donated time by volunteers and, rather, that what you would like to see maybe accepted as an expense under the fund would be infrastructure and training expenditures.

11273   The small independent stations have also in their submission made sort of a similar proposal in paragraph 44 of their submissions where they request that one third of the fund -- of the money should be used to maintain current broadcasting programming levels and quality and one third to help set off the capital cost of the transition to digital.

11274   Well, it's different from what you're commenting, but I just want to draw your attention to this. In your final submissions --

11275   MS EDWARDS: Okay.

11276   COMMISSIONER LAMARRE: -- you may want to get some inspiration from that.

11277   MS EDWARDS: Sure. We'll make a comment. Thank you.

11278   COMMISSIONER LAMARRE: Thank you. That's it.

11279   Merci, Monsieur le Président.

11280   THE CHAIRPERSON: Okay. Thank you very much. Those are our questions for you. We look forward to seeing you in April.

11281   MS EDWARDS: Thank you.

11282   THE CHAIRPERSON: Madame la Secrétaire, let's go on with the next one.

11283   THE SECRETARY: I will please now call ACTRA to the presentation table.

11284   THE CHAIRPERSON: Good morning.

11285   Are you just off the plane?

11286   MS DOWNEY: Yes, we are.

11287   THE CHAIRPERSON: Excellent timing.

--- Off microphone

11288   THE CHAIRPERSON: Okay. We'll wait until the Secretary is ready.

11289   THE SECRETARY: So, Mr. Chair, while we do this, maybe I would ask ACTRA to present your colleagues and then we'll start with your presentation.

PRESENTATION

11290   MS DOWNEY: Thank you.

11291   My name is Ferne Downey, I'm an actor and the elected President of ACTRA and to my immediate right is Nicholas Campbell, one of our biggest stars of television that you've probably ever seen and Wendy Crewson, the queen of serious television and movies as well, National Executive Director Stephen Waddell and Joanne Deere, Director of Public Policy and Communications for ACTRA.

11292   Is that good.

11293   THE SECRETARY: You're good. I'm sorry.

11294   You can start with your 10-minute presentation.

11295   MS DOWNEY: Thank you very much.

11296   Thank you, Mr. Chair, Vice-Chairs, Commissioners and CRTC staff. You've already met me this morning, so I don't need to re-introduce myself to you.

11297   We're here as the voice of ACTRA's 21,000 members who live and work in every corner of Canada. Our members are English-speaking artists whose performances cross all delivery platforms: film, television, sound recordings, radio and digital media.

11298   We are also here today representing the views of 17,000 musicians, members of the AFM Canada.

11299   Mr. Chairman, Commissioners, we are honoured to appear before you here today.

11300   ACTRA is embarking on this process in a spirit of partnership with Canadian audiences, the Commission, broadcasters, distributors and all of our colleagues in the creative community.

11301   We agree with you, Mr. Chair, that this hearing is not about the past, it is not about enshrining or protecting old business models and it is not about taxing consumers.

11302   I'm here to talk today about what we believe these hearings are about: The role and responsibility of private broadcasters; the failure of the 1999 Television Policy; how to get more scripted Canadian programming in prime time.

11303   I'm also not here to dwell on the past, but I do believe that we can be informed by the past and we need to make sure we do not make the same mistakes.

11304   We welcome this opportunity to rewrite the rules for Canadian television. We urge the Commission to seize the opportunity presented by these hearings to take a bold and creative approach and to reverse the disastrous results of the 1999 television policy.

11305   We have detailed the disastrous result of the 1999 television policy numerous times before you and the devastating impact of the policy may not have been intended, but it cannot be disputed. As a result, in the past 10 years we have seen Canadian drama all but disappear from our TV screens. We have seen our culture eroded and thousands of jobs lost as U.S. programming flooded our primetime schedules.

11306   We have been heartened to hear you, Mr. Chair, express growing concern with the gross imbalance in spending on Canadian and foreign programming. The imbalance is graphically demonstrated on the charts we have here with us today. They are the primetime schedules of global and CTV; the red is the Canadian programming, the blue the American.

11307   Mr. Chair, this is wrong, this is not what Canadians were promised in the Broadcasting Act. We are here today to implore you to make sure that this does not continue.

11308   The need for distinct Canadian content is becoming increasingly critical with the digital revolution. With access to a virtually unlimited supply of content from around the globe Canadians must have the opportunity to see our stories, dance, art and music celebrated or it risks being drowned out altogether.

11309   ACTRA also believes that Canadian stories must be available to the widest audiences possible, and conventional television is the way to do that. We have heard the broadcasters come before you and beg for more flexibility. Flexibility is what got us into this mess. Broadcasters asked for flexibility in 1999 and got it. Trust us, they said. Well, we saw what happened. Left to their own devices, broadcasters bowed to the bottom line and ditched drama in favour of cheap magazine and reality-style programming and U.S. imports.

11310   In our written submission that you have before you, we propose a detailed framework for corporate group licensing that builds on what is working and offers fixes for what is broken.

11311   Today, we will focus on a few key pieces: number one, retain all scheduling niche and CPE expenditures for specialty discretionary services, they are working; two, reinstate a CPE for OTA services; three, introduce a drama CPE floor for all broadcasting groups regardless of whether they have OTA services; eliminate the concept of priority programming; and lastly, implement a scheduling safety net on OTA services for underrepresented programming categories, in particular drama.

11312   Our proposal is flexible, while being balanced, it is forward thinking, it serves the interest of Canadian audiences as well as multiple industry stakeholders, not just one or two. Most importantly, it ensures that Canadian audiences have access to their own airwaves.

11313   I will now ask my colleagues to go into some detail on these initiatives.

11314   MS CREWSON: You might wonder why we are so obsessed with drama. It is simple, drama is the linchpin of popular culture. It is the one thing that we can all turn to, it is the voice that can go from one end of this great country to the other, it is our humour and our fears, our hopes, it is our dreams and our inspirations, it tells our stories to us and to our children.

11315   It diminishes us not to have our own stories on television in primetime in the form of drama. And unless this turns around, we are truly becoming a branch plant of American culture, that is all we will ever be and we will lose our very special brand and identity.

11316   How do we fix this? First off, we applaud the Commission's approach to look at broadcast groups as a whole. Looking at speciality and conventional broadcasting undertakings together in their corporate groups allows us to build a forward-thinking model for television that will help bring about a balance and greater strength for the system as a whole.

11317   So if we are going to take a new approach, look at what works. The exhibition and spending requirements that have been placed on specialty undertakings work. While conventional broadcasters have faced some challenges, specialty services have flourished and have made an enormous contribution to Canada's broadcasting system over the last 10 years. Canadians have access to a wide array of diverse programming that offers them so much choice.

11318   Thanks to the regulations, those choices include dramatic Canadian programming, high-quality engaging, award-winning programs that are sold around the world. We urge the CRTC to keep those niche rules in place for specialty channels, because if it ain't broke, don't fix it.

11319   We then recommend the Commission apply that winning formula to the conventional side and impose a Canadian programming expenditure on the conventional service in each group.

11320   As we have seen with the specialty side, a CPE requirement is enforceable, reduces loopholes and potential for gaming and is self-adjusting. CPE works for broadcasters by giving them fairness and flexibility. When times are good and their revenues are up, they are able to contribute more to Canadian programming. When times are tough and revenues decline, their contribution to Canadian programming also goes down.

11321   We also want to be very clear, all revenues broadcasters receive must be taken into the calculation of the CPE, including any possible new sources of revenue.

11322   But a CPE alone is not enough. We need to take steps to protect dramatic programming. We saw what happened when the drama wasn't protected in the 1999 policy. So we propose a CPE for drama for each corporate group to create a floor and ensure that broadcasters don't give into the temptation to pour all of their CPE commitments into the cheapest programming.

11323   Now, obviously, we don't want the conventional broadcasters to get a free pass here. They must contribute their fair share to the group's commitments to drama.

11324   The Commission has previously stated as an objective that English-language conventional television broadcasters should increase their spending on drama to 6 per cent of total revenues. We think this is fair and we urge the Commission to require conventional broadcasters to reach the 6 per cent target over their licence term.

11325   A group CPE to produce original Canadian drama delivers on the Commission's key objectives in outlining the scope of this policy review, greater flexibility that results in greater support for Canadian programming. It delivers benefits for each of the key stakeholders. Flexibility, it does not propose costs per hour or number of hours. Licensees can opt for a lot of the more expensive programs or to do more of the less expensive programs.

11326   It also doesn't impose new requirements for exhibiting drama on services where it does not make sense, it is reactive. Like the general CPE, the drama CPE would be based on the previous year's revenues, the amount would be self-adjusting.

11327   Transparency, the Commission would not need to worry about how or where the money is spent so long as no double counting occurs. Balance, this approach takes advantage of the increasing consolidation of the industry, allowing licensees to draw on the strength of more profitable parts of their corporate groups to support others.

11328   And quality, since the broadcasters will have to spend money on drama, the question moves from how do I produce the cheapest programming to how do I produce the best programming and how do I schedule and promote it to maximize audience levels and potential advertising revenue? Choice, Canadians will benefit from increased options to watch the type of programming they enjoy most, drama that reflects their own experiences.

11329   MR. CAMPBELL: Now, there is something that ACTRA and CTV actually do agree on, well many things, but the concept of priority programming is not working and it has to go. Unlike CTV, we think it needs to be actually replaced.

11330   What we want to do is put safeguards in place to make sure that the programming that is coming as a result of conventional CPE and group CPE for drama and comedy doesn't result in a whole whack of fabulous programming that is relegated just to specialty services.

11331   New Canadian dramatic programming produced as a result of group drama CPE must air at least once on a group's OTA services within two years of delivery resulting in a minimum of two hours of dramatic programming each week between real primetime, which is 8:00 to 11:00.

11332   Broadcasters have gotten too used to just taking off their CanCon obligations by airing reruns in the summertime and on Saturday night when there is really no one watching, and that has to stop.

11333   These minimal requirements are not really that onerous. Replacing priority programming rules with more genre-specific scheduling requirements would be more effective in assuring that there is an adequate amount of drama and comedy on conventional services while giving broadcasters what they want, which is more overall programming flexibility.

11334   We also urge the Commission to take similar steps to ensure an adequate amount of other vulnerable genres, namely long-form documentary which is something Canadians are proud of and children's programming, and put then on the conventional services. These important genres have been increasingly relegated to specialty services and it is critical really that Canadians have the choice to see these types of programs on their conventional channels.

11335   The past 10 years really have shown us that the broadcasters will really only air as much Canadian drama and comedy as the CRTC actually tells them to do. So what we are asking you to tell them is to cut their addiction to the made-in-Hollywood brand of programming and start using the talent that is right under their noses right here.

11336   I can't really underscore enough the opportunity that we have right here. There is no shortage of talent in Canada from writers, from directors. The crew members, everybody will tell you that anywhere else you work in the world, they don't match up to what we have here.

11337   Our industry is now say 52 years old, it has matured, producers come to us from around the world to use our talent, our grips, our writers, directors, performers. The problem here is that too few of our own broadcasters have really taken the time to notice or value these assets.

11338   Unfortunately, when folks are producing a series in Canada, they are having to go down to L.A. to find the talent they need, and that is Canadian talent. And too many of their brightest young Canadians, especially the young ones, who have gone through the devastation of the last 10 years have had to take their skills elsewhere to make a living and find creative opportunities here in Canada.

11339   So we need to seize this moment of opportunity so our talent will stay here to serve and create shows for our Canadian television industry that is poised to explode in ambition, in reach and in profitability.

11340   We want broadcasters to make money, that is what we are all about here, lots and lots of money. We get that a healthy system is one in which the broadcasters are able to make profits off what we do. But in exchange for permission to use the airwaves and to benefit from the other supportive public policies, the broadcasters have a public service obligation, they must contribute to our cultural identity by supporting, promoting, airing and celebrating fully Canadian stories.

11341   Because I think if Canadian broadcasters don't give us access to our own television screens to tell our own stories and celebrate our history and heroes and share our dreams and our fears like Wendy said, then no one else is going to really do it. So if they don't, we don't really need them at all, do we, because we can get a lot of their programming on American channels.

11342   We are not asking for a lot here. I don't think it is too much to ask that Canadians can have two hours, two hours in primetime every week of scriptive programming, that is comedy and dramas.

11343   And we don't want to let this slap fest that is occurring between the broadcasters and the cable broadcasters hijack the agenda here. The CRTC really has a duty to make sure that the airwaves are working for Canadians, that is the bottom line. And to make sure that we have a voice, that we have access to our culture and that we can see ourselves on our televisions.

11344   Thank you.

11345   MS DOWNEY: We have been waiting for this chance for 10 years, we can't risk another 10 years of this, our industry and our culture will be dead. The CRTC has to get this right. We can have a fantastic future, but we need to work together. We can and we must develop contemporary television policy that will meet the dual objectives of strengthening Canada's domestic broadcasting industry and providing Canadian audiences with the opportunity to enjoy the best programming we can offer.

11346   We would be happy to take any questions you may have, and Stephen Waddell will be delighted to assist us. Thanks.

11347   THE CHAIRPERSON: Thank you.

11348   You are suggesting two hours of dramatic programming in primetime between 8:00 and 11:00 per week. And then the next sentence you also mention we should do something for long-form documentary and children's programming.

11349   Are you suggesting the same thing for them, so are we actually talking about six hours in primetime each week?

11350   MR. WADDELL: No, we are basically focused on drama and comedy when we talk about that. But also to make sure that those other two genres you mentioned are finding their places on regular channels, not just on specialty services where they are getting shunted to right now.

11351   THE CHAIRPERSON: Yes. But you don't have any specific recommendation what we should do for them?

11352   MR. WADDELL: Not really my area. Anybody?

11353   MR. CAMPBELL: No, we don't have any specific recommendation with respect to children's --

11354   THE CHAIRPERSON: And you don't feel they should be grouped together?

11355   MR. WADDELL: Our focus, Mr. Chair, is on the scripted content, and that is what our recommendation is to the Commission.

11356   THE CHAIRPERSON: Now, on that paragraph 2 on page 7 Mr. Campbell says:

"New Canadian dramatic programming produced as a result of group drama CPE must air at least once on a group's OTA service within two years of delivery resulting in a minimum..."

11357   This "resulting in a minimum", is that a prediction, is that an estimate?

11358   I mean, if I understand it, you want them to spend 6 per cent of their revenues to group-produced drama and it has to be aired within two weeks. Does that automatically result in two weeks primetime per week?

11359   MR. CAMPBELL: Well, it is two years. What we are seeing sometimes, even with the national broadcaster, with CBC, is they produce a lot of programming and they shelve it so sometimes it doesn't show up for, you know, three or four years, if it airs at all.

11360   So if we say that they will commit to a primetime airing within two years of delivery, then that would make us very happy.

11361   THE CHAIRPERSON: So it is not, technically speaking, resulting and you want to impose on them an obligation to put two hours on primetime per week?

11362   MR. CAMPBELL: Right.

11363   THE CHAIRPERSON: And where is the money for all of this coming from? You have heard this last week everybody saying -- and the unfortunate fact is we make money on American programming and we buy it with simsub and we get the Canadian advertising, advertising runs the system, et cetera.

11364   So the more you impose upon us on concrete Canadian -- the more you reduce the revenue stream that we have available to produce Canadian products.

11365   MR. WADDELL: If I may, as we have said, and as you are aware, the broadcasters are blowing their brains out on buying American programming $740 million last year. But I don't think we need to hold a bake sale for the broadcasters.

11366   The ACA, Association of Canadian Advertisers, came before you. We have a collective bargaining relationship with the ACA and the ICA, and I am aware that they have estimate that there are new opportunities for advertising, that advertising in this country, particularly "television advertising itself is an advertising medium that remains very strong", and I am quoting from their submission.

11367   Since 1995 TV's annual share of total Canadian ad spend, without exception, has been between 23 and 25 per cent and that there are new opportunities for advertising on VOD and local availabilities and targeted dynamic ad insertion, all of which would amount to another half billion dollars worth of advertising.

11368   So you know, that's where the broadcasters can make some more money. And they should take that money. So that is not an issue, they should take that money and they should spend it on putting more red on this primetime chart. That is our submission, Mr. Chair.

11369   MS DEER: And just to be clear, I mean, we are not saying that they can't air any American programming --

11370   THE CHAIRPERSON: No, no.

11371   MS DEER: -- we are just asking for two out of the 18, so that still leaves them plenty of time, you know, to sell the big, you know, money-making American shows as well.

11372   THE CHAIRPERSON: So if I understand it correctly, you feel our 1999 decision was a mistake, and I think it is commonly acknowledged that that is the case. And you want us to reintroduce a CPE requirement, it is really a double CPE requirement if I understand it; one for the group as such, and then also within in that group on the OTA, a special CPE for drama, if I understand that correctly or is that 6 per cent for the whole group or only for the conventional part of the group?

11373   MS DEER: Conventional.

11374   MR. WADDELL: It is for the conventional part, Mr. Chair.

11375   THE CHAIRPERSON: Okay, thank you.

11376   Steve, over to you.

11377   COMMISSIONER SIMPSON: Thank you very much.

11378   Very thorough approach at CPE, I was very impressed. Frankly, very complex, but I think it is a complex problem.

11379   But I am going to try and simplify it with some anecdotal concepts here to try and sort of elevate this questioning to not so much the mechanics, but the objectives again.

11380   In looking back at previous policy, in 1972 which we all love and hate to talk about, there was an exhibition requirement that was a primary focus in those days. In 1979 it was matched with spending commitments. And then 1999 everything went to hell in a hand basket, in your view, with a lessening of exhibition requirements producing the graph you have over there.

11381   Now to characterize, you know, we are looking at an issue here that I would like some clarity on. Do you feel, you know, given the comment that we would all like to see conventional television making lots of money, is the problem that they are spending too much on U.S. programming because they recognize they make money off of that type of programming or is it that they are not spending enough on Canadian programming?

11382   MR. WADDELL: Both. We gave you the stats, you know the stats, you have had other organizations before you that have said that the reason why the broadcasters are -- profits, in part, are in the toilet is because they are blowing their brains out on American programming.

11383   And the other side of it is last year they only spent $54 million on Canadian dramatic content. So the answer is both is the problem and we have to turn it around. As Nick said, you have to stop this addiction to the U.S. programming.

11384   And in order to really be Canadian broadcasters and attract audiences they can't be spending their time, spending their money on cheap reality-based lifestyle programming. They have to put high-quality, distinctive Canadian-scripted content back on the airwaves. People will watch it.

11385   Ask Nick and Wendy what it is like walking down the street, they get recognized all the time for their roles in various TV series. You know, people love that, to watch Canadian programming, especially dramatic content.

11386   So let's put it back on primetime, you know, get it off the shoulder periods where they are putting it now. They are putting Canadian content on Saturday nights when no one is watching, which is why we need to look at real primetime, which is Sunday to Friday and 8:00 to 11:00 rather than 7:00 to 11:00.

11387   COMMISSIONER SIMPSON: Thank you. If the focus is on cheaper production to fill hours, why is the cost of the U.S. programming going through the ceiling, just for the record?

11388   MR. WADDELL: Because they can, right? Because the U.S. studios can get a good dollar out of it because the Canadian broadcasters are competing with each other, and the price goes up as a consequence. It is just plain old supply and demand and so, you know, the American's aren't stupid, they are getting their top dollar for the programming.

11389   But on the other hand, from a Canadian programming or Canadian production perspective, you can't compete. I mean, you can't compete with $250,000 for 24, right, which is what they are paying. You know that show cost $5.5 million to produce U.S. And so, you know, a Canadian program of decent quality is going to be between $1.2 million, $1.8 million. So it is like straightforward economics here, the broadcasters are just going to go for the cheapest option, as they always do.

11390   They have to be obligated. I mean, that is what this is all about. They have to be obligated to do the right thing for Canadians.

11391   COMMISSIONER SIMPSON: Thank you.

11392   Given that we are struggling with the notions that we are trying to understand the best way to fulfil the Broadcast Act mandate and at the same time address the economic realities of commercial broadcasting, if we were to be successful in the future with -- I don't want to be so optimistic as to say a wholesale reversal of those spending formulas, but a significant change.

11393   I would like to go to two points in your written submission. First, was your admission that U.S. programming does make money, but when you look at the Nordicity study it indicates in a fairly fulsome manner that Canadian programming does make money. But there was a caveat in there that I would like a bit of an explanation on. The caveat seemed to be that the full amortization value of Canadian programming has to be taken into consideration before there is a reasonable return for the broadcaster and the producer.

11394   Now, is that same condition applicable to the U.S. programming or is it apples to apples when you compare values?

11395   MR. CAMPBELL: Well, they are not permitted to air as many times, they have to keep paying for it for the American programming. For Canadian, because we do buyouts and we are looking to get our stuff on the air, you know, it is much more liberal. They can take a show and run it as many times as they like basically for five years. So that way they can make their money, which is what we are pretty happy about.

11396   MR. WADDELL: Mr. Simpson, I mean, different markets, our market is 10 per cent of the U.S. market. They recover their investment on their first run. In Canada, of course our population is one-tenth of the size, you have to repeat and repeat and repeat and that is what the broadcasters do.

11397   They repeat on their over-the-air networks and then they repeat on their specialties and then they will put it on their websites and away you go. I mean, you have to do that in Canada order to recoup your investment and then you hope for foreign markets.

11398   COMMISSIONER SIMPSON: Okay, thank you.

11399   You have indicated that you agree to the notion that we have to look forward, this shouldn't be a backward-looking exercise. But you also indicate that it is necessary, before we go two steps forward, to go one step back to 1999 and put exhibition requirements and spending requirements back in place.

11400   Now, if that were to happen, why is it necessary then to also have a floor in place as well as spending requirements that have an upward objective?

11401   MR. CAMPBELL: Well, we still always struggle to try and get Canadian shows, except on the national broadcaster, into primetime and, you know, to have the same seat at the launches in the fall that the American stars do.

11402   We have been harping on the primetime thing now since -- as long as I have been involved with ACTRA and coming up to Ottawa, and that would be the most significant advance we could make, because we will actually say to Canadians that, or the broadcasters will say, that they put the same value on our programming as they do on what they acquire south of the border.

11403   COMMISSIONER SIMPSON: But a floor CPE would also help prevent gaming when it comes to -- is that the idea behind it?

11404   MR. CAMPBELL: Right.

11405   COMMISSIONER SIMPSON: Okay.

11406   There were few and fairly innovative notions floated in the last week and a half that I am not sure whether you have been aware of. One was the whole issue of avails and the fact that if there was a technical mechanism capable to have BDUs substitute commercials and avails, it creates a revenue pool for -- could be the broadcasters, MédiadeNovo, who are proposing the technology here indicate that they would be very willing to look at distribution as much as 70 per cent of that money, to apply it to wherever the greatest need is, which could include Canadian productions.

11407   Have you thought at all about that issue?

11408   MR. WADDELL: Yes, we have and we support the idea. Perhaps in the past we wouldn't have, because it might have been construed as taking advertising away from the broadcasters. But the fact is the broadcasters are not doing their job. So if you want to take the money, put it into a pool to create more production money, we are for that.

11409   COMMISSIONER SIMPSON: Same question on substitution, non-sim substitution which, when you look at it at face value, has a very tantalizing prospect of creating some very tantalizing blocks of primetime property. Have you got a position on that?

11410   MR. WADDELL: We sure do.

11411   MS DOWNEY: Yes.

11412   MR. WADDELL: The whole notion of non-simultaneous substitution you have got a big problem, and I think I have described that problem to the Commission before, which is the U.S. guilds would therefore require -- you know, it would be a second run in Canada if it is non-simultaneous.

11413   And I know my colleague from CFTPA said don't worry, you know, I will take care of that. Good luck. That ain't gonna happen. I have been in the industry since 1972. One of the first times I went down to the United States to meet with my colleagues was on that issue and they said, no way. It hasn't changed in 40 years. Their position is going to be the same, they are not going to give up a 100 per cent payment which they get for a second run, no way, it ain't gonna happen.

11414   Now so, you know, with that in mind, if you want to go ahead and prescribe non-simultaneous substitution, fine, but somebody is going to have to pay for it and I don't think it is feasible. But on the other hand, you know, the concept of having more flexibility in the schedule so you don't get this situation is a useful one, but maybe that is not the way to go. Perhaps, you know, program deletion, something like that.

11415   COMMISSIONER SIMPSON: In TELUS's submission their belief is the future is friendly, but it also includes video-on-demand and a move to non-linear programming. There obviously are revenue opportunities that present themselves.

11416   Where I am going with this is trying to identify and see where there is common thinking in other areas of financial opportunity within the existing system in absence of a value-for-signal regime taking place. And in VOD have you considered that more fulsomely than you have in your written submission? And were do you think that is going as far as Canadian content?

11417   MR. WADDELL: As I said in my earlier comments, there is an opportunity with respect to video-on-demand for ads and that that opportunity should be taken, in our view.

11418   COMMISSIONER SIMPSON: I gather from your written submission and your oral submission that you do not buy the argument that the conventional television model, the OTA model, is broken and may be damaged through some benign neglect to certain requirements.

11419   But given that position there is always the possibility that the OTA model will not survive. That has to be contemplated. It's a game changer for everyone but in interviewing a few of the BDUs they definitely have demonstrated an appetite, you know a recognition for the importance of content, because without content they have nothing.

11420   It puts the conventional broadcaster into a role where if they are not financially viable you have no customer, they have no source of programming. And it ostensibly puts the BDU into the potential role of becoming the broadcaster.

11421   Is this something that you have considered? Do you see this as being a part of the future of Canadian broadcasting and something that we have to address as a Commission?

11422   MR. WADDELL: Well, let me begin with as we have said, and you have echoed in your question, that we don't believe that the broadcasting system is broken. It certainly needs repair and not the least of which is the Commission needs to reinstate content and expenditure requirements in order to get more Canadian programming in primetime.

11423   As I -- you know quoting the advertisers associations brief, TV advertising is strong. Over-the-air broadcasting isn't going anywhere anytime soon. It's still the major vehicle for delivering advertising and content to Canadians and will continue for some time.

11424   Sure, specialties -- and the more power to them -- are taking some of the audience. Thank goodness, because at least there are content requirements on the specialties and we are seeing Canadian content and good Canadian content on the specialty channels. And new media is certainly taking some advertising and, again, you know more power to them. There is more -- as they said, there is more opportunities available for advertising.

11425   So you know I think that, yes, I mean if anybody checked we are going through a recession here and there has been a downturn in ads particularly, but we are coming out and advertising is going to be strong especially going into -- coming into -- going into and coming out of the Olympics.

11426   So you know in our view all of this big public battle where Jim Shaw and others are blowing their brains out on ads and the Globe & Mail and National Post are making a lot of money on full page advertising, you know hundreds of thousands of dollars are being spent on this ridiculous battle, public battle, it's time to come back to reality, folks.

11427   And the reality is, yes, there is advertising money available and the real problem is not that. The real problem is this. There is no Canadian programming scripted content in primetime. We need it.

11428   COMMISSIONER SIMPSON: My last question -- and thank you. That was a great answer.

11429   My last question goes back to U.S. programming and the fact that it comes equipped or attached with a heavy promotional component, a U.S. star system which doesn't seem to have impeded your careers at all because I think that, you know, Canadian talent is well recognized but perhaps not promoted enough or with enough machinery behind it.

11430   And so this is my question. In the evolution of the funds, like the Canadian Media Fund as it's evolving and other funds that support the creation of content top-up fees and so on, is there in your mind enough attention being paid to or is there -- are there enough components that help address the promotional needs of Canadian content outside of the actual creation of the content itself and should there be more?

11431   MS CREWSON: You know there is really very little that is put into promoting Canadian content. It becomes a self-fulfilling prophecy for the broadcasters to say, "See, it's not working. We are not getting the audiences because it's not promoted because nobody knows because they switch us around in time schedules. As soon as an American program is coming on they dump the Canadian program. Nobody can follow their favourite show".

11432   So certainly they don't put it into the machine. They don't want it to work. So you know that becomes disappointing for the entire industry.

11433   And they do so, you know, at their own peril because the fact of the matter is it does make money, it will make money; it can make money. It's not the reason we ever go out to do it but we are artists. We don't go out there to make the money.

11434   But if you go at it with the right heart and the right feeling of something that is true to the voice of this country and true to Canadians then you will have a good product and it will sell and people will watch it and it will be popular and it will make money. But it's hard to come at it from the other side.

11435   Art is funny that way. It's going to turn around and bite you in the butt because it doesn't -- it needs to come from a real place and until they start doing that they are not going to have the big hits and the big, you know, programs that are going to be making the money that it should.

11436   COMMISSIONER SIMPSON: I am not sure I got my answer.

11437   Are funding formulas that support the creation of Canadian content sufficiently addressing the needs to promote that content?

11438   MR. CAMPBELL: Well, there have been a lot of remedies I noticed when we were working on that show in Vancouver and a different sort of programs were put in place to help our producers with, you know billboards and stuff like that, and it certainly did help. And we did see right away that there was an increase in our audience especially in certain markets that they focused on to see if it actually was working and it did work.

11439   So you know promotion -- the best promotion is like, well, what he said if the show is good the word of mouth does better than trying to stump for something that maybe is not all that great.

11440   The Americans have a bit of an advantage because so many platforms of their culture is part of our daily lives here, and it's just like bred into the DNA of Canada now. You know people are more aware of what is happening down there in terms of entertainment and our own entertainment shows kind of focus on the American product. So you know it's tough to compete with that.

11441   But you know we are aware that Canadians do expect and they do enjoy what we are trying to do. And you know I frequently get asked why, you know why is there not more and what happened to that show and it's hard to come up with good answers on the street.

11442   COMMISSIONER SIMPSON: Thank you very much.

11443   THE CHAIRPERSON: Mr. Waddell, just a question of clarification. When my colleague asked you about the MédiadeNovo you suggested it should be paid in a fund. Would you also go along with it going into the Canadian Media Fund?

11444   MR. WADDELL: Absolutely.

11445   THE CHAIRPERSON: Thank you.

11446   Michel.

11447   COMMISSIONER ARPIN: Mr. Waddell, in your reply to Commissioner Simpson regarding the various contributions that goes to -- like the compensation for values of the service is authorized that this should be accrued into the revenues and obviously the CPE shall apply to that. We have created the Local Programming Improvement Fund last year and the purpose of that fund is to help financing local production in the smaller markets rather than the network and the major markets or the TV stations.

11448   In asking that that money be accounted within the CPE is it not diverting the purpose of the fund because if -- say that we establish a CPE at 35 percent, that means that 35 percent of the LPIF will go into other purposes than doing local programming in the local markets?

11449   MR. WADDELL: If they are getting the money as revenue it should also be counted as part of the expenditure.

11450   COMMISSIONER ARPIN: Well, the expectation of the Commission in creating the LPIF, the expectation is that the money will be spent locally for local programming, mainly news and public affairs. What you are trying to do here is to divert that money towards drama or other documentaries or other purposes.

11451   MR. WADDELL: Well, I'm sorry. I don't understand what you are getting at. Maybe you can explain a little more --

11452   THE CHAIRPERSON: You are trying to hijack a subsidy. That's what he is saying.

11453   MR. WADDELL: We are?

11454   THE CHAIRPERSON: Yes. It's a subsidy for local content, not for Canadian drama.

11455   MR. WADDELL: Okay, but --

11456   THE CHAIRPERSON: By putting it into the pot you are in effect diverting it.

11457   MR. WADDELL: News and local programming need support. We are not arguing against that, for sure. But local programming could also include scripted drama. I mean shows like Red Green started on -- and others started on local programs -- local stations. What's wrong with that?

11458   COMMISSIONER ARPIN: They are not forbidden to do that but the amount of money they are getting will not probably allow them to undertake that type of programming.

11459   MR. WADDELL: Well, then give them more money.

11460   COMMISSIONER ARPIN: Well, go and ask Mr. Shaw to put more money in the kettle.

11461   MR. WADDELL: Well, we gave you some -- well, sure Jim Shaw should put more money into it. That's a whole other topic. You want to get into that? Absolutely, the BDUs made $2.1 billion in profit last year.

11462   You know if you are going to give them fee for carriage, value for signal or whatever you want to call it, don't download it onto consumers. Get them to take it out of their gross bloated profits.

11463   COMMISSIONER ARPIN: Okay, thank you.

11464   That was my question, Mr. Chair.

11465   CHAIRPERSON: Rita.

11466   COMMISSIONER CUGINI: Thank you, Mr. Chairman, and good morning.

11467   Just for the actors, I know that -- I think all three of you have worked on both sides of the border and I'm always encouraged to see that you haven't defected completely.

11468   Just a point of clarification, in your exchange with the Chairman earlier regarding your proposal in terms of drama in primetime did you confirm with the Chair that your request includes two hours a week of drama or is it just a CPE?

11469   Because I thought I heard you say two hours, Mr. Waddell.

11470   MR. WADDELL: It's both. It's both CPE and two hours in real primetime.

11471   COMMISSIONER CUGINI: Then explain to me why on page 6 of your oral presentation it says:

"It does not propose costs per hour or a number of hours. Licensees can opt for a few more expensive programs or additional less expensive programs. It also doesn't impose new requirements for exhibiting drama on services where it does not make sense."

--- Pause

11472   MS DEER: It's not an ultimate number of hours. I mean at the end of the day it's just two per week but, I mean, whether that's -- you know I am doing some quick math on the spot here -- times 52 weeks a year or, I mean, they could produce 3,000 -- sorry, 3,000 hours of dramatic programming with their expenditure requirements or they could do just enough to meet that two hours a week.

11473   And in terms of not imposing requirements where it doesn't make sense, like for example we are not saying they have to air drama on TSN or --

11474   COMMISSIONER CUGINI: Right, but you can see why I am confused because you just said it doesn't -- your script says it doesn't impose a number of hours but now you are saying two hours.

11475   MS DEER: Right, sorry. And in the big picture it doesn't impose a number of hours but per week it does impose a number of hours.

11476   COMMISSIONER CUGINI: Okay. You also say:

"Introduce a drama CPE floor for all broadcasting groups..."

11477   COMMISSIONER CUGINI: Surely here you don't mean broadcasting groups that don't have services on which they could exhibit drama, do you?

11478   MS DEER: Yeah.

11479   COMMISSIONER CUGINI: All right.

11480   All right. Thank you. Those are my questions.

11481   THE CHAIRPERSON: Elizabeth.

11482   COMMISSIONER DUNCAN: I just wonder. I'm interested in your point about the lack of promotion about Canadian programs and I can appreciate watching all the promotion that Jully Black gets for example on CTV and the promotion of Flashpoint. I'm sure that that is very effective for those people.

11483   And I'm just wondering, in putting your proposal together, if you considered a recommendation that might -- that we could incorporate in the Regulations?

11484   MR. CAMPBELL: Well, the whole thing about promotion is one thing that's got us all confused and we don't know how to do it effectively. And so they keep on trying different models.

11485   You know the best promotion is good shows and, you know, you used Flashpoint as an example. There is like millions of Canadians watching every episode of it. So it sort of is it's own best -- it wasn't the promotion that went into making Flashpoint so popular. Partly it's because Canadians I think responded to a show that was airing in the States and that made them feel proud and they also recognized Canadian names and locations within the episodes.

11486   So it was -- there is a sort of an untapped Canadian nationalism out there that other parts of the culture, like in books and certainly in music with regulation have actually been able to access.

11487   We have had a more difficult trip there because I think we have such a huge, you know battle on our hands with the American juggernaut. It's not just us in Canada. It's also, you know, what I hear from my colleagues in Britain and other places as well.

11488   And so the promotion -- the best promotion is always the best shows. I think that we are starting to see a maturation in the Canadian production community where shows are appealing to Canadians and Americans at the same time without making any apologies.

11489   COMMISSIONER DUNCAN: Okay. I agree. Actually, I thought that -- I agree with what you are saying.

11490   I just thought that these repeated ads, promo spots, also helped draw viewers to that program on the dial, you know.

11491   MR. CAMPBELL: They certainly do but that's expensive air time. You know if they don't think they are getting bang for their buck they wouldn't do it.

11492   COMMISSIONER DUNCAN: That's why I'm suggesting maybe there should be a regulation.

11493   MR. CAMPBELL: Oh, it would be wonderful. That would be good news to us.

11494   COMMISSIONER DUNCAN: But you didn't consider a recommendation --

11495   MS DEER: I mean, we would also expect that, you know, by having expenditure and exhibition requirements that knowing that they have to spend that amount of money anyway, the broadcasters are going to look to get the best return on it and getting that return means advertising and promoting it properly.

11496   COMMISSIONER DUNCAN: Good, a business model.

11497   Okay, thank you very much.

11498   Thank you, Mr. Chairman.

11499   THE CHAIRPERSON: Mr. Campbell, I have a question for you.

11500   You seem to be the exception to the rule. I think there is hardly a Canadian who hasn't seen Da Vinci's Inquest. So how did you breakthrough if there is such a lack of promotion of Canadian programming? How did you actually become a sort of household name in Canada?

11501   MR. CAMPBELL: Well, I think a lot of it was to the credit of there was a program in place at one of the funding bodies anyway which gave us a new pool and then my boss, Chris Haddock, actually put money out of his own pocket into it.

11502   And we tried to find different ways to do it. Like for example on the show there was a -- the main character was running for police chief. So we papered all the big cities in Canada you know with mock election proposals, you know "Da Vinci for chief" and all this. And we actually got, you now, a pretty good return on it.

11503   But I think that the shows are just -- they were just a little different and they appealed to not only sort of the homeless and all that -- I mean those are some of my biggest fans.

--- Laughter

11504   MR. CAMPBELL: But the shows were actually about Canadians and I think that that resonated very strongly and you know people say, "Oh, you have got to check that show out".

11505   And CBC, they did a wonderful job of promoting it in sort of different ways than I see them doing things now.

11506   CHAIRPERSON: I see, okay.

11507   And the last, Mr. Waddell, I don't want to hear diatribes about Jim Shaw or BDUs, et cetera, but on the value for signal, you know, the basic position has been by the OTAs that they are not fully compensated for the value of their signal. There is some compensation in terms of mandatory carriage, simsub, et cetera, but they are not fully compensated.

11508   On the other hand, the BDUs say, "No, you are -- actually you are getting more than your full value" and our position is, well, you negotiate it. We don't know where it is.

11509   Where do you stand on this proposition that they should negotiate to ascertain what the true value of their over-the-air signal is?

11510   MR. WADDELL: Well, it does seem inequitable that the BDUs are paying $300 million a year to retransmit American signals into Canada and the Canadian broadcasters don't get any fee for their signals.

11511   So if the Commission believes that they should enter into negotiation and come up with a value of signal then we would support that, on the proviso that you also put some brakes in place to require a CPE and content requirement with respect to scripted drama, Mr. Chairman.

11512   THE CHAIRPERSON: You saw that both CTV and CanWest suggested there should be a CPE for OTA. I don't think they went as far as to say there should be a portion reserved for drama but already -- I mean that's the first step in that direction.

11513   MR. WADDELL: Well, that's great. CPE is good. It's a good thing.

11514   THE CHAIRPERSON: Yeah.

11515   MR. WADDELL: No question about it, but you have got to look at you know again -- I will hold up the chart again. You have got to look at that. That's where the problem lies. It's with scripted content and a lack of it in real primetime and, please, Mr. Chairman, and members of the Commission, please reinstate the content requirements.

11516   Thank you.

11517   THE CHAIRPERSON: Okay. Thank you very much. Those are all our questions.

11518   If you have any further additions to make you can do it until December 14th.

11519   MS DOWNEY: Thank you very much.

11520   THE CHAIRPERSON: And is the next group here, Madame la secrétaire?

11521   THE SECRETARY: Yes, they are, Mr. Chair.

11522   THE CHAIRPERSON: In that case why don't we do it -- that's the last of the day, right?

11523   THE SECRETARY: All right.

11524   THE CHAIRPERSON: We will have a late lunch and we will go to --

11525   THE SECRETARY: All right.

11526   THE CHAIRPERSON: We will take a five-minute break before we start.

11527   THE SECRETARY: Thank you.

--- Upon recessing at 1150

--- Upon resuming at 1158

11528   LE PRÉSIDENT : O.K. Madame la Secrétaire, commençons.

11529   LA SECRÉTAIRE : Alors, Monsieur le Président, j'inviterais maintenant l'Alliance québécoise des techniciens de l'image et du son, l'AQTIS, à faire sa présentation.

11530   Comparaît madame Brunhilde Pradier pour l'AQTIS. Elle nous présentera ses collègues, après quoi, vous aurez 10 minutes pour faire votre présentation. Allez-y.

PRESENTATION

11531   MME PRADIER : Monsieur le Président, Mesdames et Messieurs les Commissaires, nous vous remercions de l'occasion qui nous est offerte de vous présenter aujourd'hui, les préoccupations de l'Alliance québécoise des techniciens de l'image et du son, l'AQTIS.

11532   Je suis Brunhilde Pradier, présidente de l'Alliance.

11533   Je suis accompagnée aujourd'hui de madame Francine Benoît-Plamondon, chargée des affaires politiques de l'AQTIS, et de monsieur Guillaume Sirois, consultant à l'AQTIS.

11534   L'AQTIS est une association qui représente pas moins de 3 000 artistes concepteurs, artisans et techniciens membres et plus de 1 000 techniciens permissionnaires, soit quelque 4 000 professionnels expérimentés qui se consacrent quotidiennement à la production d'oeuvres cinématographiques et télévisuelles réalisées en territoire québécois.

11535   Nos membres sont des professionnels pigistes qui, avec leurs collègues des autres associations d'artistes, sont au coeur des succès de la télévision québécoise et canadienne des dernières décennies.

11536   La présente consultation porte sur quatre enjeux importants pour l'avenir de la télévision, qui auront tous potentiellement des répercussions sur les conditions de vie et de travail des membres de l'AQTIS et plus largement sur les milieux de la création au pays.

11537   Pourtant, au cours des semaines qui ont précédé l'ouverture de la présente audience, l'attention a été largement dirigée vers une seule des questions ici en jeu, soit la juste valeur marchande des signaux des services traditionnels.

11538   L'AQTIS est consciente de l'importance de l'enjeu pour les télévisions traditionnelles et c'est pourquoi nos premiers commentaires porteront sur ce sujet.

11539   Toutefois, la question qui est tout à fait déterminante pour nos membres est celle du projet de modèle d'attribution des licences par groupe de propriété.

11540   L'adoption du modèle tel qu'il est proposé par le Conseil pourrait avoir des conséquences importantes sur la quantité de productions indépendantes qui sera réalisée au pays dans les prochaines années et, par ricochet, sur les opportunités de contrats de travail qui seront offertes à nos membres.

11541   Aussi, nous souhaitons profiter de notre intervention pour porter à l'attention du Conseil certaines conséquences fâcheuses que ce modèle d'attribution des licences pourrait entraîner.

11542   Depuis plusieurs années, l'AQTIS s'inquiète de l'affaiblissement progressif et généralisé des télévisions traditionnelles. Comme plusieurs intervenants de l'industrie le constatent, la multiplication des canaux spécialisés a eu pour effet la dilution d'un bassin d'auditeurs qui demeure toujours sensiblement le même.

11543   Cette multiplication des contenants aura entraîné un appel d'air pour le contenu destiné à remplir ces nouveaux espaces de diffusion. Or, les moyens pour financer les productions télévisuelles n'ayant pas suivi la même courbe ascendante que les espaces à remplir, nous sommes désormais devant une situation où l'on peine à développer un nombre suffisant de produits télévisuels.

11544   Les solutions mises de l'avant pour faire face à cette situation sont trop souvent la rationalisation du contenu créatif, la rediffusion et la multiplication de l'offre de productions américaines, et c'est bien ce qui inquiète l'AQTIS.

11545   Bien que l'expertise de nos membres et de leurs collègues des autres associations d'artistes soit garante de la plus-value de nos produits, le résultat net est qu'ils travaillent dans des conditions toujours plus précaires, où la réduction des budgets de productions a comme corollaire la réduction des jours de tournage, une importante réduction des moyens mis à la disposition du travail créatif, des économies quant aux conditions d'exécution de leur travail et une augmentation des risques liés à la santé-sécurité au travail. En somme, on nous demande de livrer le même produit de qualité avec des budgets de plus en plus faméliques.

11546   La proposition mise sur la table par le Conseil, soit celle d'accorder des redevances aux télévisions généralistes pour la diffusion de leur contenu par les entreprises de diffusion par câble et satellite, nous semble un moyen intéressant de corriger le déséquilibre qui existe aujourd'hui dans notre système.

11547   Nous pensons qu'il s'agit de trouver des règles qui assureront une source de revenus stables et prévisibles aux télévisions généralistes locales, mais sans que cette facture ne soit refilée au consommateur. Il faut donc que le Conseil accorde le droit à ces redevances aux télévisions locales, mais aussi qu'il réglemente les tarifs de la câblodistribution.

11548   Ce qui importe surtout à l'AQTIS dans cette bataille qui oppose les télévisions généralistes locales et les entreprises de câblodistribution, c'est que l'on se donne collectivement les moyens de maintenir et de développer un bassin de créations capable de produire une télévision canadienne riche et diversifiée qui reflète les intérêts et les préoccupations des Canadiens.

11549   C'est d'ailleurs ce principe qui guide notre analyse du modèle proposé par le Conseil pour l'octroi des licences par groupe de propriété.

11550   Il est désormais de notoriété publique que le paysage complexe de la télévision au pays a subi d'importants changements au cours des dernières années.

11551   La multiplication des canaux spécialisés que nous évoquions à l'instant, la dilution des auditoires, et la fragmentation des enveloppes publicitaires qui les accompagnent, mais aussi l'intégration verticale et horizontale simultanée qui a marqué le développement de l'industrie au cours des dernières années ont rendu inadéquat le système d'attribution des licences qui avait cours jusqu'à maintenant.

11552   L'AQTIS pense donc, à l'instar du Conseil, qu'il est maintenant pertinent de se questionner sur ce mode d'attribution des licences.

11553   D'entrée de jeu, l'AQTIS tient à saluer la préoccupation du Conseil de favoriser le développement d'une production télévisuelle de qualité dans cette refonte du système d'attribution des licences qu'il s'apprête à mettre de l'avant.

11554   Nous pensons que ce nouveau modèle permettra au Conseil d'évaluer plus justement les différentes contributions d'un groupe de propriété au système de radiodiffusion. Nous pensons que cette approche est valable puisque le système de vases communicants entre les différents services de télévision est désormais une réalité en raison de l'envergure des propriétés croisées.

11555   La nouvelle approche permettra donc au Conseil d'avoir un portrait plus juste des pouvoirs que ces grands groupes ont désormais sur la création, la production, la programmation et la distribution du contenu créatif télévisuel.

11556   Si cette nouvelle approche nous semble adéquate en soi, il y a toutefois quelques éléments du modèle proposé qui soulèvent des craintes légitimes du milieu de la création télévisuelle, au premier chef, le caractère transférable des obligations réglementaires d'un service à l'autre à l'intérieur d'un groupe de propriété.

11557   Cette nouvelle disposition nous suggère que nous sommes sur le point d'inventer un système qui permettrait à des services de télévision de se soustraire à leurs obligations réglementaires dans la mesure où d'autres services du groupe peuvent récupérer ces obligations.

11558   Il nous semble qu'un tel modèle fait fi des mandats spécifiques de chacun des éléments du groupe puisque certaines licences sont accordées spécifiquement pour la mise en ondes de contenu canadien, ce qui pourrait éventuellement entraîner une diminution significative de ce même contenu canadien sur d'autres services du même groupe.

11559   Si cela devait survenir, il n'y aurait, à notre avis, plus aucune raison de maintenir une licence pour un service qui mobiliserait une part de l'espace public canadien, tout en ne diffusant que marginalement du contenu canadien.

11560   Ceci aurait pour effet d'accroître le problème constaté, soit une ponction des revenus publicitaires qui auraient pu servir à d'autres chaînes plus enclines à contribuer à la production et à la diffusion de contenu canadien.

11561   C'est pourquoi l'AQTIS demande au Conseil de ne pas autoriser cette possibilité de transférer les obligations réglementaires. L'AQTIS croit fermement que des obligations réglementaires doivent être attachées à toutes les licences de diffusion accordées par le Conseil, et ce, autant en ce qui à trait aux dépenses en matière d'émissions canadiennes, tout comme au chapitre de la diffusion de ce contenu ainsi qu'au recours prépondérant à la production indépendante. Il en va de la contribution des milieux créatifs canadiens et de la qualité de la télévision produite au pays.

11562   L'AQTIS ne craint pas d'affirmer que l'émergence d'une télévision québécoise de qualité depuis quelques décennies est fortement tributaire des différentes réglementations mises en place afin d'élargir les bassins de création et de diversifier l'offre télévisuelle en développant une production indépendante de celle des grands réseaux.

11563   La production indépendante a permis de développer une structure industrielle de production où chacune des parties prenantes est elle-même indépendante l'une de l'autre. Ces parties prenantes partagent donc conjointement une part de responsabilité dans le succès des productions et de l'industrie.

11564   Une des particularités sur laquelle se fonde le succès de cette formule réside dans une circulation fluide des créateurs et techniciens d'un projet à l'autre. L'apport constant de collaborations nouvelles entre créateurs et artisans concepteurs contribue de façon exceptionnelle au développement d'expertises individuelles, enrichissant d'autant le potentiel créatif des projets.

11565   L'AQTIS constate que la vitalité de la production indépendante actuelle et ses succès sont intimement liés à ce contexte de production qui engendre une saine concurrence artistique entre les créateurs, mais aussi entre les producteurs, et poussent tous les intervenants à se dépasser à chaque nouveau projet.

11566   Cette richesse et cette diversité des bassins de créateurs ne sauraient se maintenir, ni continuer de se développer, sans un niveau de production indépendante soutenu. C'est pourquoi l'AQTIS demande au Conseil de conserver des obligations réglementaires non négociables pour les dépenses en matière d'émissions canadiennes, de diffusion de ce contenu canadien et de recours prépondérant à la production indépendante. Il nous semble qu'il s'agit là des trois piliers qui nous assurent un milieu créatif vivant et sans cesse renouvelé.

11567   Nous vous remercions de l'attention que vous nous avez accordé et nous sommes prêts à recevoir vos questions.

11568   LE PRÉSIDENT : Merci pour vos observations.

11569   Vous dites à la page 6 du deuxième paragraphe que vous n'êtes pas en faveur que le Conseil autorise une possibilité de transférer les obligations réglementaires.

11570   Est-ce que vous êtes complètement contre un transfert ou est-ce que vous accepteriez un minimum, comme l'a suggéré, par exemple, Astral, qui était ici hier et qui a suggéré qu'on autorise un minimum ou un maximum de 15 pour cent entre les diverses obligations entre les canaux et...

11571   Est-ce que vous croyez que c'est possible, parce que, évidemment, ça leur donne un peu de flexibilité pour planifier leur travail?

11572   M. SIROIS : Oui, alors, on comprend tout à fait la nécessité d'avoir une flexibilité. C'est pour ça que tout au long du mémoire, on suggère qu'il y a des obligations réglementaires attachées à chaque licence, mais aussi aux grands groupes. C'est le modèle que le Conseil a commencé à développer, et donc, on pense que ça pourrait donner la flexibilité nécessaire aux canaux, tout en respectant des minimums pour chaque licence. Voilà!

11573   LE PRÉSIDENT : Ça veut dire non, vous n'êtes pas en faveur de transférer un minimum d'une licence à l'autre?

11574   MME PRADIER : C'est-à-dire que si on prend le groupe dans son entier, en fait, je n'ai pas entendu ce que le groupe a dit hier, mais j'ai vu dans la proposition de l'APFTQ, par exemple, une demande d'analyse des licences par groupes de services, parce que, évidemment, dans chacun des groupes de services, il y a une iniquité dans les groupes eux-mêmes.

11575   LE PRÉSIDENT : Oui.

11576   MME PRADIER : Il y a des diffuseurs qui ne sont que diffuseurs, et il y en a d'autres qui ont aussi des chaînes de canaux spécialisés, et la télévision éducative ne peut pas compétitioner sur l'évaluation du grand groupe. Alors, cette méthode de tout regrouper ne ferait que favoriser le groupe qui est constitué en grand groupe, finalement.

11577   LE PRÉSIDENT : O.K. Merci.

11578   Suzanne?

11579   CONSEILLÈRE LAMARRE : Merci, Monsieur le Président.

11580   Bonjour. Merci d'être ici avec nous ce matin. J'ai quelques questions. Certaines, vous avez déjà répondu dans votre présentation, mais d'autres, non, et je cherche principalement à obtenir des précisions au niveau de votre mémoire.

11581   En partant, la première précision que j'aimerais avoir, c'est au sujet de votre objection à l'utilisation de la terminologie « programme d'intérêt national » plutôt que « programme prioritaire. »

11582   Dites-moi si je me trompe là. Ce n'est pas tellement la terminologie qui vous agace ou à laquelle vous objectez que l'élargissement de la définition par rapport à ce qu'on considère comme étant de la programmation prioritaire maintenant?

11583   MME PRADIER : Effectivement. En fait, on constate qu'il y a des changements de terminologie qui arrivent là dans les dernières années. Il y en a un autre que j'ai vu plus récemment dans les questions du Fonds canadien de la télévision, où on ne parle plus de service de radiodiffuseur mais de télédistribution ou de télédiffusion, et qui sont des terminologies qui, à toute fin pratique, nous amènent sur de toutes autres considérations.

11584   Alors, celle-ci, évidemment, va beaucoup plus largement que la question des émissions prioritaires, qui va dans le sens de ce qui avait toujours été préconisé et choisi comme étant prépondérant par le Conseil.

11585   CONSEILLÈRE LAMARRE : Donc, si on avait à établir des exigences réglementaires pour les émissions qui étaient diffusées, vous préféreriez qu'on en reste à la définition qu'on a présentement d'émission prioritaire?

11586   MME PRADIER : Oui, absolument. Oui.

11587   CONSEILLÈRE LAMARRE : Maintenant, pour revenir un petit peu à votre discussion avec monsieur le président, au niveau justement de la flexibilité pour les obligations réglementaires. J'aimerais ça regarder un petit peu plus en détail avec vous, parce que ce que je lis dans vos paragraphes 17 et 21 de votre proposition, de votre soumission, autant en ce qui concerne les dépenses que les heures de diffusion, vous semblez craindre un abus absolument extraordinaire qui ferait en sorte que des services spécialisés perdraient leur définition de service et que la télévision conventionnelle se transforme, elle, en service spécialisé.

11588   Est-ce que je lis ça correctement?

11589   M. SIROIS : Oui et non. C'est-à-dire ce qu'on craint, c'est que certains services spécialisés puissent prétendre diffuser tout le contenu canadien pour un groupe, et donc, que certaines télévisions généralistes soient, par le fait même... aient la possibilité par le fait même de baisser le contenu canadien qu'elles présentent en ondes. C'est surtout ça que l'on craint ici, et c'est ça qu'on demande au Conseil d'éviter, en fait.

11590   CONSEILLÈRE LAMARRE : Compte tenu dans le marché francophone de l'appétit évident des téléspectateurs pour des productions canadiennes/québécoises, est-ce que vous estimez que c'est un danger qui est vraiment réel ou est-ce que ça serait plutôt une dérive à long terme que vous craignez qui puisse arriver?

11591   MME PRADIER : Bien, je pense que c'est la constitution même de ces différents services là. Alors, la télévision traditionnelle est une télévision qui, en pratique -- en tout cas, jusqu'à maintenant -- est encore accessible à l'ensemble des Canadiens, alors que les canaux spécialisés, ce n'est pas le cas.

11592   Oui, les gens en sont friands, mais c'est un tout autre mode aussi, je pense, de consommation. C'est la différence entre consommer une encyclopédie et puis consommer un recueil de différents articles sur tout le sujet là. On parle de deux univers télévisuels complètement différents.

11593   Et comme la télévision traditionnelle est accessible à tout le monde et qu'elle est présente dans tous les foyers, on ne voudrait pas que la télévision traditionnelle soit dépouillée de son contenu canadien, d'émissions prioritaires et aux heures de grande écoute par les Canadiens.

11594   CONSEILLÈRE LAMARRE : Dans un autre registre, au sujet de la production indépendante, dans votre mémoire, vous en faites état. Vous dites que vous désirez qu'il y ait des critères minimums pour la diffusion et aussi l'achat de productions indépendantes. Et dans votre mémoire, vous parlez que les télévisions traditionnelles publiques et privées de langue française soient tenues de consacrer 15 pour cent de leurs revenus à la production indépendante.

11595   D'abord, quand vous dites 15 pour cent des revenus, vous parlez des revenus totaux de ces télévisions-là?

11596   MME PRADIER : Je ne sais pas si vous faites référence à la même question, à savoir si les... qui a été posée partout là, considérer les revenus du Fonds canadien de la télévision dans la poche globale de revenus des télédiffuseurs. La réponse, c'est oui.

11597   Cependant, je tiens à faire une précision. Quand nous parlons de production indépendante, puisqu'on sait qu'il y a des changements qui s'en viennent dans les modes d'attribution au Fonds canadien des médias, nous parlons de la production véritablement indépendante. Nous ne parlons pas de la production faite par les producteurs de maisons affiliées aux diffuseurs.

11598   CONSEILLÈRE LAMARRE : Et quand vous dites les télévisions traditionnelles publiques et privées, les télévisions publiques, vous voulez dire autant Radio-Canada que les télévisions éducatives?

11599   MME PRADIER : oui

--- Pause

11600   CONSEILLÈRE LAMARRE : Maintenant, au niveau de l'établissement de la juste valeur marchande des signaux, qui pourrait amener une source de revenus supplémentaires pour les télévisions conventionnelles, vous nous encouragez à le faire d'une certaine façon, tout en nous mettant en garde contre une approche qui ferait du succès auprès de l'auditoire et du rendement économique les seuls critères d'évaluation de la juste valeur marchande de ces signaux.

11601   Est-ce que, ce matin, vous pouvez élaborer sur quels critères, en fait, vous aimeriez voir être établis pour baliser les négociations, si jamais on adoptait le concept?

11602   MME PRADIER : Je ne suis pas moi-même à transiger la diffusion des justes valeurs marchandes entre producteurs et diffuseurs. Donc, je pense que les critères qui s'appliquent ou ceux que je serais à même d'imaginer ne sont pas nécessairement cohérents.

11603   Ceci étant dit, il y a d'autres... je dirais chez les cablôdistributeurs, la notion de cote d'écoute ou de... sur les auditoires, qui, à mon avis, ne peuvent pas être les seuls facteurs puisqu'il y a des émissions, il y a des contenus canadiens qui s'adressent nécessairement à des publics naturellement limités, et donc, ça ne peut certainement pas être le seul facteur.

11604   Mais j'imagine qu'il y a d'autres critères qui pourraient être évalués, par exemple, au pourcentage de contenu canadien diffusé, qu'il y ait un équilibre qui soit fait dans ces calculs pour tenir compte à titre d'incitatif ou d'élément favorisant.

11605   CONSEILLÈRE LAMARRE : Ici, effectivement, on établissait le pourcentage de contenu canadien diffusé comme étant un des critères dont il faut tenir compte.

11606   Est-ce qu'on devrait le faire sur l'ensemble du groupe de propriété ou uniquement, selon vous, sur ce qui est diffusé par la télévision conventionnelle?

11607   M. SIROIS : Très bonne question.

11608   CONSEILLÈRE LAMARRE : Vous pouvez réfléchir et répondre dans vos commentaires.

11609   M. SIROIS : Oui. Voilà! Voila! Mais je ne sais pas, moi, je suggère en tout cas que... oui, il faudrait réfléchir à la question. Mais j'imagine que si c'est de l'argent pour un signal diffusé par la télévision traditionnelle, il serait logique que ça s'applique au contenu diffusé par cette même télévision, si je comprends bien la question.

11610   CONSEILLÈRE LAMARRE : Bien, je vous la pose, alors...

11611   M. SIROIS : D'accord. D'accord. Oui, je pense qu'il faudrait prendre la question en délibéré parce qu'il faudrait y penser, mais la logique m'indique, disons, que ce serait notre position.

11612   CONSEILLÈRE LAMARRE : Et juste en terminant, je veux vous signaler que, justement dans la préparation peut-être de vos commentaires pour le 14 décembre, il y a quand même deux soumissions qui nous ont été faites au niveau des critères qui devraient être tenus en compte.

11613   Il y en a une qui a été faite par le groupe Quebecor, et sans surprise là, la cote d'écoute y tient une bonne place, et il y en a aussi une qui a été faite par le SCFP et aussi la soumission conjointe qu'ils ont faite avec le CPSC. Donc, vous voudrez peut-être y jeter un coup d'oeil avant de préparer vos commentaires.

11614   Ce sont toutes mes questions. Merci beaucoup.

11615   LE PRÉSIDENT : Michel?

11616   CONSEILLER ARPIN : Merci, Monsieur le Président.

11617   L'AQTIS, qui porte le nom... c'est parce que vous parlez toujours du pays, puis vous utilisez le mot « Canadien ». Est-ce que vous avez des membres à l'extérieur du Québec?

11618   MME PRADIER : Non. Nos productions se font principalement au Québec.

11619   CONSEILLER ARPIN : Donc, essentiellement, si j'essaie de synthétiser vos représentations, les groupes consolidés au Québec dans le secteur privé, il n'y en a rien qu'un. Donc, votre mémoire est essentiellement à l'égard d'une seule entreprise?

11620   MME PRADIER : Oui. En fait, le modèle... oui, puis, en fait, le modèle francophone... on peut dire qu'au Québec, le modèle ou en tout cas le succès de la télévision francophone est remarquable et se compare très, très bien, et on sait bien que dans le Canada anglais, nos contreparties n'ont pas réussi à obtenir autant de succès.

11621   CONSEILLER ARPIN : C'est parce que j'essaie de bien comprendre les craintes réelles.

11622   Est-ce que vous avez des craintes réelles ou des craintes théoriques par rapport à la situation courante et puis prévisible si vous avez entendu la comparution de Quebecor? Quebecor se fait fort de la promotion de la production canadienne. Pour lui, c'est la pierre angulaire de son succès.

11623   MME PRADIER : Oui, absolument. Nous, ce qu'on défend à travers notre mémoire, c'est aussi beaucoup la production indépendante...

11624   CONSEILLER ARPIN : Oui.

11625   MME PRADIER : ...parce que, évidemment, Quebecor, dans tout son empire, est à la fois cablôdistributeur, diffuseur et producteur. Donc, il y a une espèce de...

11626   CONSEILLER ARPIN : Malgré tout, Quebecor revient continuellement à la charge en disant qu'il ne sera jamais en mesure lui-même de produire des émissions de type dramatique, il va toujours se référer à la production indépendante parce que les gains de créativité sont trop importants en utilisant les producteurs indépendants.

11627   Parce que j'ai compris les maisons affiliées... je sais bien qu'ils en ont une maison affiliée, mais essentiellement, la proposition de Quebecor, c'est quand même axé sur l'utilisation des producteurs indépendants.

11628   MME PRADIER : Oui, dans une certaine mesure, mais je pense que ce qui est en train de se discuter ici par rapport à ces questions-là n'est pas indépendant de ce qui se discute, par ailleurs, dans un autre forum, qui est au Fonds canadien des médias. Et au Fonds canadien des médias, évidemment, la discussion tourne autour, justement, de l'accès à des fonds publics par les maisons affiliées aux diffuseurs, en tant que productions accessibles au financement.

11629   Nous pensons que tout ce système, évidemment, doit être cohérent et se tenir, et la production indépendante telle que... les propositions sont sur la table et les demandes de Quebecor sont sur la table par rapport à ce qui se demande au Fonds canadien des médias. C'est justement peut-être qu'ils feront encore appel à la production indépendante, mais de moins en moins et si peu.

11630   Ce que nous, nous défendons, c'est la diversité des bassins de création et la diversité des voix, et nous sommes convaincus que c'est cette formule qui a fait son succès à la télévision québécoise francophone au Québec. Ce n'est pas seulement du fait qu'elle soit québécoise.

11631   Elle a généré un succès, et c'est une formule qui avait justement été voulue pour sortir des modèles des grands réseaux traditionnels, et si on ne regarde pas les politiques dans l'ensemble pour véritablement favoriser la production indépendante et la diversité des bassins de création et la diversité de l'offre télévisuelle au consommateur, on va inévitablement revenir au modèle qu'on avait à l'origine sur les deux grands réseaux, pour lesquels on avait voulu, justement, trouver des mesures alternatives pour stimuler la création et le contenu créatif.

11632   Les techniciens, les artistes et les artisans qui travaillent à la production indépendante ont développé ces carrières, et là, c'est comme si, parce qu'il y a une structure industrielle particulière et une volonté de développement d'affaires qui est préoccupée exclusivement financièrement à la rationalisation des revenus sur les contenus et du transfert des contenus et de pouvoir utiliser les uns par rapport aux autres, ce qu'on se trouve à reproduire comme modèle, on revient 25 ans en arrière. On va se retrouver 25 ans en arrière, et ce dans quoi on coupe véritablement, c'est la diversité des contenus créatifs.

11633   Nous, ce que nous prétendons, ce que nous disons, c'est que nous sommes au coeur... cette formule qui force les gens et les artisans à se mélanger de saison en saison et à travailler parfois dans une équipe et parfois dans une autre est un modèle extraordinairement riche et stimulant, et c'est ce qui produit, à notre avis, ce qui concoure à produire une télévision de qualité.

11634   On trouverait ça très dommage que nous, qui sommes une partie prenante importante des artisans de la création de la télévision, soyons mis à l'écart d'un nouveau modèle de réglementation qui est là, prévu pour avoir la meilleure offre télévisuelle pour les Canadiens.

11635   CONSEILLER ARPIN : D'accord.

11636   MME PRADIER : Voilà!

11637   CONSEILLER ARPIN : Merci.

11638   MME PRADIER : Merci, Monsieur Arpin.

11639   LE PRÉSIDENT : O.K. Ce sont toutes nos questions. Merci d'être venus.

11640   Je crois que ça termine notre audience pour aujourd'hui, n'est-ce pas, Madame?

11641   LA SECRÉTAIRE : C'est bien ça, Monsieur le Président. Alors, on se rencontre demain matin à 9 h 00.

11642   LE PRÉSIDENT : O.K. Merci

--- Whereupon the hearing adjourned at 1228, to resume on Thursday, November 26, 2009 at 0900

   REPORTERS

____________________      ____________________

Lynda Johansson         Jennifer Cheslock

____________________      ____________________

Monique Mahoney         Beverley Dillabough

Date modified:

2009-11-26