Transcript, Hearing November 28, 2018
Location: Gatineau, Quebec
Date: November 28, 2018
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Attendees and Location
140 Promenade du Portage
- Chairperson: Ian Scott
- Vice-Chairperson Broadcasting: Caroline J. Simard
- Vice-Chairperson Telecommunications: Christianne Laizner
- Legal Advisors: Eric Bowles, Valerie Dionne
- Secretary: Lynda Roy
- Hearing Managers: Tracy Speigel, Tina-Louise Latourelle
--- Upon commencing on Wednesday, November 28th, 2018 at 9:01 a.m.
3509 THE SECRETARY: Alors, s'il vous plaît. Order please.
3510 Good morning, everyone. Mr. Chairman, today we're starting with Phase II whereby applicants appear in same order as Phase I to intervene on competing application, if they wish. Some of them have not decided yet, so I will just call them upon when their turn comes. And just tell me at this time if you're appearing or not.
3511 We'll start with Rogers. You get -- you have 10‑minutes this morning. Go ahead.
PRESENTATION / PRÉSENTATION
3512 MS. WATSON: Merci. Bonjour, bon matin.
3513 My name is Colette Watson. I am Senior Vice-President, Television and Broadcast Operations at Rogers Media. With me today are Susan Wheeler, Vice-President, Regulatory; Nathen Sekhon, OMNI News BC; and Manuel Fonseca, General Manager, OMNI.
3514 We are appearing today to address the issue of newsgathering for third-language communities. It's apparent from discussions you have had with other applicants that their approach to delivering the news is not exceptional. Every other applicant has either ignored or abandoned the principle that guides our editorial approach and standards in delivering third language news programming to ethnic and third language communities. Only OMNI's proposal puts in place the ability to reflect diversity between the various language and cultural groups, and also reflect the regional diversity within the language and cultural groups.
3515 What does that mean? It means every language community needs its own distinct editorial approach when delivering news and information programming. While ethnic communities throughout Canada may have common interests, they also deserve access to their own local stories.
3516 Our ability to tell local, regional and national stories is because of our local over-the‑air television stations and is the reason we are delivering four distinct regional feeds. All of the other applicants are proposing national news comprised of stories gathered from across the country. They are merely inserting local stories into national newscasts. To us, this isn’t local news and it is not good enough.
3517 Using the Commission's definitions, this might be locally relevant, but it is not locally reflective. Nathan will now explain how OMNI makes that distinction.
3518 MR. SEKHON: From our perspective, it's important to understand that the lens through which each community views the world and news is sometimes very much the same, and often very different.
3519 Take the example of Rogers and the distinct approach we took in the weeks leading up to the legalization of cannabis. while CityNews had featured stories every day for over a month, OMNI took a different editorial approach for each of the communities we served.
3520 For our Cantonese viewers, our newscasts focused more on the harms and ills. Whereas for Punjabi newscasts approached the story with far less concern, speaking more about the new laws and what the regulations entailed.
3521 Where one community saw angst, the other saw a weed that simply grew on the streets back home. That cultural nuance would not be captured by simply versioning the City newscasts into these languages. This demonstrates how we deliver news tailored to a specific community, not just in a language they understand.
3522 The other point of distinction is how we approach local news. For OMNI, providing a local perspective is vital. The assumption that having a single story from every region is enough doesn’t meet our standards. Are Punjabi viewers in Vancouver interested in a story about the Punjabi Community in Toronto? Of course. Is just telling that story adequate? Absolutely not. We are all Canadians and we all deserve to be informed about issues that allow for civic engagement just as much as anyone else.
3523 OMNI sets a bar higher than the other applicants with respect to regional diversity, airing 30‑minutes of national news, followed by 30‑minutes of locally focused news in the same language.
3524 For example, in this past week, a Punjabi Member of Parliament from Ontario resigned from his position. Being of interest to all Punjabis, the story was told in the national news.
3525 At the same time, OMNI's Punjabi news team in B.C. focused on -- continued to follow the story of major spending and infrastructure changes in the City of Surrey after a new Mayor was elected. That story would not have made it in a national newscast, but for Punjabi's in the local Surrey community, it had been both an importance and very divisive. Conversely, the Ontario Punjabi news team focused on the Ontario MP and told that story at a deeper level going into the local community for their thoughts and reactions.
3526 The takeaway from this is that both stories were worth telling, and needed to be told, but only one was relevant to Punjabis across the country. That underlines the need for locally reflective approach that OMNI brings to its language communities and is missing from all of the other applications before you. Only OMNI's approach gives communities access to news of national interest and of local importance, and at the same time, it allows for both stories to be told in a relevant and a reflective way.
3527 MS. WATSON: The combination of these two factors means that we deliver local, regional, and contextual relevance for the audiences we serve. Using our approach, a broadcaster could not provide news and information programming equal to what we have proposed at a wholesale rate of 12 or 13 cents. The only way any news could be produced and aired in multiple languages for that amount of money would be to re‑version existing English and French news content into a third language from two of the largest broadcasters, CBC and Global. With respect, Canada's third language communities deserve more than that.
3528 If any of the other applicants were to be granted a licence to operate a 9(1)(h) multilingual multi-ethnic service, Canada's ethnic and third-language communities would cease to receive the same breadth and depth of local, regional, and national news programming that OMNI Regional currently provides. In fact, ethnic audiences would receive considerably less value than they receive today from OMNI Regional.
3529 With the exception of Rogers, none of the other applicants have operated any kind of multilingual and multi-ethnic service that would be comparable to OMNI Regional. That's critically important. They have little understanding of the unique costs and revenue opportunities associated with operating such a service, nor do they fully understand how the programming needs of multiple third-language communities can be met.
3530 We are actually creating stories that are produced by journalists from the communities we serve, as opposed to versioning pre‑existing English or French language story and simply translating it.
3531 The caliber and quality of the news programming OMNI provides should not be risked in favour of unrealistic promises and inexperienced applicants.
3532 Thank you Chair and Madam Vice Chairs. We'd be pleased to respond to any questions.
3533 THE CHAIRPERSON: Commissioner Laizner?
3534 COMMISSIONER LAIZNER: Good morning. Thank you for these comments. I have a few questions, but they're related mostly to the written intervention that you had filed on the record of this proceeding. And so I'll start with those.
3535 You had stated in your intervention that the advertising revenue projections submitted by the other applicants were just unrealistic and unachievable. And I'm sure you've heard what the comments have been from the various applicants that have been before us and their strategy on the advertising front. So I'm just wondering how you respond to that?
3536 MS. WATSON: The -- they simply are just not experienced at it with respect to knowing what -- how to forecast for it. My response to the fact that we are not serving OMNI viewers and advertisers well, it's just -- I categorically reject that.
3537 We -- our team, we have 60 reps on the street. Whether they're incented or whether they're selling a variety of packages, in our mind adds to the value of that. We are able to walk in the door of a national marketer and offer OMNI as one of the options we have. That makes us more unique. That gives us an edge over a client or over a broadcast entity that maybe doesn't have language-specific opportunities or targeting an ethnic group that may be of particular interest to that advertiser.
3538 With respect to our sales structure, every sales rep is incented, they have revenue targets assigned to OMNI. There is no reason not to try and sell it.
3539 The other thing I would question back is one of those applicants suggested that we perhaps do it off the sides of our desk while that particular -- or a partner in that consortium does the exact same thing and that, you know, for example, selling language advertising requires a certain -- is harder to sell and so this entity uses a consortium group to go out and sell a group of channels and their specific channel no longer sells language programming. It’s all English, so English is easier.
3540 COMMISSIONER LAIZNER: And what about the arguments by one of the applicants that by having journalists in the localities -- I think they mentioned they were going to hire 53 local journalists -- that the presence of those journalists in the community and the relationship building would be instrumental in achieving better advertising revenues?
3541 MS. WATSON: That’s what we do today. We have journalists in those communities. That applicant said they were going to have production facilities in Toronto, Vancouver and Montreal. That’s where we are today, in addition to Alberta, and so we are able to do that. In fact, our Alberta ---
3542 COMMISSIONER LAIZNER: How many journalists do you have dedicated to ---
3543 MS. WATSON: If I use the definition that Bell used, we have 95.
3544 COMMISSIONER LAIZNER: Okay. Okay. The other question I wanted to ask you was the kinds of modifications that you say your service would have to make technologically, for example, if the ECGL service was granted mandatory distribution. I think you indicated in your intervention that it would be extremely costly to implement ECGL’s multi-audio feed.
3545 MS. WATSON: At the BDU level, but I’m not qualified to speak on the BDU’s behalf.
3546 MS. WHEELER: I’m not sure I am either, but my understanding from discussions with our cable affiliates is that the audio -- the -- for each video channel, they’re only able to deliver, at maximum, three audio channels, so in order to facilitate the delivery of the 25 different audio channels that ECG (sic) is proposing to offer would require adding a number of channels to their bandwidth and which is obviously going to be a strain on capacity, particularly for small systems, and certainly is not something that they’re able to accommodate right now.
3547 MS. WATSON: And having said I wasn’t qualified, now, I’m going to weigh in. They also said that they would provide that on an SD signal and an SD signal, as a viewer, then provides a lesser quality signal than an HD signal. So they’re compromising the viewer experience in order to provide language.
3548 COMMISSIONER LAIZNER: Okay. All right, thank you. Those are my questions.
3549 COMMISSIONER SIMARD: Thank you.
3550 THE CHAIRPERSON: Go ahead.
3551 COMMISSIONER SIMARD: Thank you, Mr. Chairman. Thank you for your presentation this morning.
3552 I think it was yesterday that Telelatino, ATN and Corus Group talked about the study that they conducted and the outcome of this study with respect to the wholesale rate. So in their views, the wholesale rate should be in the range of 12 cents to 15 cents, so what do you think of this conclusion?
3553 MS. WATSON: We concluded -- so we conducted research, as well, and I don’t have the research with me, but -- if I -- going by -- 70 percent of those consulted thought that the -- that having this service was an excellent idea -- 80 percent thought it was an excellent idea.
3554 Where we -- and then we questioned on rate, notwithstanding Mr. Nanos’ comments about his views on that. We questioned on the rate and so obviously if the third-language cohort at 67 percent thought that we -- oh, Susan’s got them. Why don’t you go for it.
3555 MS. WHEELER: Sure.
3556 MS. WATSON: Yeah.
3557 MS. WHEELER: So just to clarify, I believe that the study that was being referenced by the Corus-Telelatino consortium was the study that we filed in our 2016 application. We refreshed that study in our subsequent application and what we were really pleased to find out is that there was actually an increase in the number of people who actually believed a service of OMNI -- like OMNI was important.
3558 That was obviously a -- and, in fact, it was amongst the English-and-French-language-speaking population that that level of support increased. The third-language community remained the same. It was always very high, so that’s not a surprise.
3559 But our study basically supports the notion that up to about 50 percent of the population or a little over 50 percent of the population would support a service at a wholesale rate of at least 21 cents. So our application starts at 19 and increases to 21 and we felt that that was a fair wholesale rate given the level of support for a service of this nature.
3560 COMMISSIONER SIMARD: And my last question is a question of clarification. You just said that based on the definition provided by Bell for journalists, your number is 95, so could you clarify a bit?
3561 MS. WATSON: For sure. So we have journalists who are the person you would see standing up in front on camera. Then we have writers. We have producers. We have camera operators and editors. So all of those combined, there are 95 people who put together news every day at OMNI.
3562 MS. WHEELER: Just -- Bell was referring to multi-skilled, so we’re assuming that multi-skilled means that they’re skilled in a variety of news-gathering functions.
3563 COMMISSIONER SIMARD: Thank you.
3564 MR. SEKHON: Just a bit of clarification on that too. When we referred to multi-skilled, the concept is commonly referred to a VJ. Someone will go out by themselves and shoot and edit and source everything by themselves. That’s not a model that we choose to follow for various reasons, but on the flip side, all of our people including our shooters, including our editors; everyone helps to serve in an editorial capacity. Gone are the days where you simply do one thing. We just choose not to say we’re going to hire fewer and make them do everything by us.
3565 THE CHAIRPERSON: Counsel, do you have any questions? No? Then I thank you very much.
3566 Madame la secrétaire?
3567 THE SECRETARY: Yes, Mr. Chairman. Just for the record, I will invite Multi-Cultural Described Video Guide to come on up here if he wishes, but I don’t think he’s in the room right now, so he’s not going to be appearing in Phase 2.
3568 Ethnic Channels, Amber Broadcasting and Bell Media have indicated they will not be appearing in Phase 2, so I will invite, again, for the record, Independent Community Television-Montreal, but I don’t think they’re in the room right now either, so I will invite Telelatino to come forward to the presentation table please.
3569 (SHORT PAUSE/COURTE PAUSE)
PRESENTATION / PRÉSENTATION
3570 MR. DI FELICE: Good morning. We’re glad to be back again. Aldo Di Felice. Oh, not yet?
3571 COMMISSIONER SIMARD: Yes, please, go ahead. Just reintroduce yourself for the record.
3572 MR. DI FELICE: Aldo Felice -- Aldo Di Felice, President of Telelatino Networking joined my -- by my colleagues, Agatha Pezzi and Elena Abramova from TLN, as well, joined by our counsel to my left, Ken Engelhart as well as our partners from ATN, Prakash Naidoo and -- only Prakash Naidoo to reply to the following points:
3573 On the issue of multiple channels, real or virtual versus VOD: How do we address the limitations of linear TV channels to best serve numerous multilingual audiences? The limitations of a single linear channel are what several applicants have tried to address. The Rogers and Bell proposals contemplate running multiple channels. The Ethnic Channels Group proposal is to create many virtual channels. All of these proposals increase costs and none of these proposals address the core issue from the viewers’ point of view, wanting to watch the show of their choice, in the language of their choice, when they want to not when it is scheduled.
3574 The ECG proposal in particular, only allows the viewers to find their language at all times, assuming all language feeds are carried by BDUs. But they must watch the show that is being broadcast. It is a technical solution that, even if adopted by all BDU's, doesn't fully solve the core issue for viewers; watching the specific show in their specific language when they wish.
3575 In fact, the Ethnic Channels Group presentation made specific reference to Netflix as a reference point of a VOD service that is carrying multiple language programs, immigrant language programs. And in fact, it is a VOD service and that is an over the top delivered VOD service. We’re proposing a VOD service delivered by the BDUs themselves on their existing VOD platforms.
3576 Only Video On Demand, addresses the consumer preference for consuming both the content and language of their choice at the time of their choice.
3577 All major and medium sized BDUs currently offer VOD to their subscribers, and we propose to populate a Canadaworld TV VOD channel with content for the BDUs to offer to authenticated BDU subscribers, at no additional cost.
3578 VOD has the added benefit allowing us to add extra content in languages to be offered, than can fit onto a linear channel, extra content of various genres and extra content in additional languages.
3579 The second point we’d like to make is with respect to Rogers’ financial statements, which they filed in relation to the current application and the understated subscriber revenues and underspending in PNI commitment according to the statements that our financial team has looked at.
3580 There are two discrepancies that our finance team has pointed out and that don’t seem to have been addressed by anyone. The first is that subscriber revenues appear to have been understated by over 11.5 million over the five-year term. We make that calculation by simply applying Rogers’ requested wholesale rates each year, 19, 19, 20, 20, and then 21 cents to the Rogers’ forecast subscribers each year, which yields a total revenue figure of 107 million.
3581 That number is over 11 and a half million higher than the 95 million stated in the Rogers OMNI regional/OTA financial projections dated September 25, 2018. We’ve provided the Commission with a snapshot calculation for reference.
3582 Secondly, although the Rogers proposal to double PNI expenditures under the current OMNI regional licence from 2.5 percent to 5 percent has been tabled, the actual PNI calculation in the Rogers financial statements dated September 25, 2018 show only average 1.0 percent increase. That is a PNI spend of between 3.7 and 3.8 percent. That is another discrepancy that our financial team has noticed and does not appear to have been addressed in any of the back and forth additional questions and submissions prior to this hearing.
3583 There are several other issues I think, that I should address based on the comments that were just made by Rogers.
3584 First of all, I’d probably refer back to our reply to interventions dated June 18th, 2018. In that, ultimately the arbiter of what’s relevant to audiences are not the executives that are running the channel but the audiences that are attracted to watching the content. And although there are deficiencies in rating measurement systems, the one reference point Numeris, which is a third-party audience measurement system was referred to in our June 18th reply.
3585 And what it shows is that the audiences for the Rogers reinstated newscasts in Chinese, Punjabi, and Italian have, to the extent of the high 80 percent to 98 percent, not returned for the equivalent periods of nine months prior to their being cancelled and the nine months since they were reinstated. We’ve provided full details in our June 18th reply.
3586 As a reference point, they would indicate that the numbers of people who are actually satisfied are low and are fewer than were attracted before these newscasts were cancelled. We think that’s a relevant reference point.
3587 Secondly, with respect to the advertising revenue, I just heard Ms. Watson refer to, I believe, ourselves. I don’t think it was Umber that they were referring to, as “just not experienced” when it came to advertising revenue.
3588 I beg to differ because we’ve been selling ethnic advertising for 34 years, but certainly during my 20 years. Ethnic advertising is what we sell, third language advertising is what we sell. We also have English language programming and we sell that too. But we are quite experienced in selling third language programming and programming specifically relevant to our communities.
3589 ATN is perhaps even more experienced in selling multiple languages, third languages, and successfully doing so according to their annual reports.
3590 The other point that was made seemed to refer to us as well, selling our advertising through an outside commercial house. All of our sales are done in house, by staff in our Toronto and Montreal offices, and we don’t have any outside representation of our advertising sales inventory. And from my understanding, Prakash runs the ATN operations in exactly the same way, as an in-house advertising sales operation.
3591 So the expertise for selling ethnic advertising exists in house at both ATN and TLN.
3592 There was also a reference to -- by the Rogers group just earlier, to other applicants simply versioning the newscasts, and they referred to the fact that they don’t simply version the city newscasts. This is a mischaracterization, I think, of at least our application that has been perpetuated, that I think we cleared up yesterday. We’re not proposing to dub over existing finished newscasts, and I think we explained yesterday that we didn’t intend that. But it appears that that characterization continues to be made and I wanted to dispel that.
3593 And finally, I think I heard a reference to inexperienced applicants. I think it was in the context of references being made to us, although we weren’t specifically mentioned. And I think we’ve already filed with the Commission substantial background information on just how experienced we are, just how successful, and dedicated, and accomplished we are, specifically in the area of multicultural television. Both ourselves and ATN are, I think, leading multicultural broadcasters in Canada, not inexperienced applicants.
3594 My colleagues may have more to add.
3595 THE CHAIRPERSON: Thank you. Colleagues, any questions?
3596 I have one. Just a clarification with respect to the document that you just provided us and the reference to Rogers’ material. Is this information that is already on the record that you are discussing, or are you raising a new point? And I say that just for obvious reasons. It’s not the point in the proceeding to introduce new evidence. So I just want to clarify whether or not this information is on the record and a clarification of a point.
3597 MR. DI FELICE: The only evidence we’re -- is our testimony referring to publicly filed information that Rogers has filed. So we’re providing, for clarification purposes, a numerical description of the words I’ve just spoken so that you understand how we’re making the calculation.
3598 THE CHAIRPERSON: Okay.
3599 MR. DI FELICE: But we’re not filing new evidence. We’re simply stating that the currently filed financials do not reflect either PNI spend commitment or the subscriber revenue that would be calculated. So there appears to be an unexplained mathematical aberration.
3600 THE CHAIRPERSON: Fair enough. We’ll take the document under advisement and counsel can decide whether we need to attach an exhibit number, or the Hearing Secretary, and we can deal with any issue after the fact.
3601 With that, counsel, any questions?
3602 MS. DIONNE: I would just like to clarify. So the table, it’s based on data already filed on the record by Rogers?
3603 MR. DI FELICE: Yes.
3604 MS. DIONNE: Thank you.
3605 THE CHAIRPERSON: Thank you.
3606 And I don’t expect there will be a concern, but that’s fine. We’ll take it under advisement.
3607 Thank you. Thank you very much for your reply.
3608 Madame la secrétaire?
3609 THE SECRETARY: Thank you very much. CORRCAN Media Group to come forward.
3610 Go ahead, gentlemen, when you are ready. You have 10 minutes.
PRESENTATION / PRÉSENTATION
3611 THE HONOURABLE MR. VOLPE: Good morning once again, Commissioners. I’m Joe Volpe, the President of CORRCAN Media Group.
3612 Just as a brief reminder to myself why we’re here. We’re here because CRTC is looking for a new partner to deliver news and current affairs programming that’s relevant to 22 percent of the population that still functions in a language that’s not either English or French. And maybe it’s time that we stop being polite, as I heard the last two intervenors, trumpeting the fact that they were the most experienced people. We’re here because that experience didn’t produce what you were looking for.
3613 So this proceeding is an opportunity for the Commission to fulfil and to fill a huge void in the broadcasting system. It can do that by seeking out a new partner that will not only provide the service it demanded but also open an unprecedented opportunity to provide a critical forum for allophone communities to both express and display its creativity and showcase its own Canadian realities and identity within their linguistic reality. It means you’ve got to go to somebody new. That person may not be experienced in the traditional sense of broadcasting.
3614 In our case, we have lots of broadcasters who are part of our group. None of them failed like the ones who just appeared before you a few moments ago.
3615 Many of the incumbent broadcasters who have never expressed an interest in providing multilingual multiethnic news and public affairs programming have been quick to throw in an application into the ring once you put out the call. However, without being completely embedded within the ethnic communities and utterly engaged with them for content, talent and contributions, none of those applicants can possibly or truly succeed. The successful proposal must be grass roots. That’s what we represent.
3616 We concur with the written submissions by Telus earlier on in this process that the Commission should refrain from granting a 9(1)(h) licence to any vertically integrated applicant. The broadcasting system should not be owned and/or controlled by a few large, profitable and integrated companies that have done little to enhance diversity, exhibit homegrown talent or meaningfully engage with the allophone community for views, input and contributions to their programming. In fact, at least one of them abandoned that project three years ago.
3617 So we have prepared brief comments on selected applications. And in the interest of time, we have not addressed all applications, and our choice to do this does not necessarily mean that we imply support for any of them. We’re here for ourselves and for the CRTC and the Canadian public instead.
3618 So I’ll turn to my colleague Jean Brazeau for the rest.
3619 MR. BRAZEAU: CanadaWorld or CW proposes to provide daily newscasts in Cantonese, Italian, Mandarin, and Punjabi. In addition, they propose adding some news programs on a staggered schedule in 16 different languages.
3620 To deliver on this fundamental requirement, CW plans to enter into a supply arrangement with Canada's publicly funded national broadcaster, the CBC.
3621 In other words, a clear reading of CW's application is that delivering news in multiple languages every day is too challenging. CW's reliance on CBC resources is effectively a translation of CBC news. CW will essentially profit by relying on the services of the subsidized Crown corporation to deliver the most important component of its programming obligations, thus double dipping in Canadian taxpayers' contributions. The CW news plan, which may not be original, is empty in engaging, embracing and employing the allophone community it plans to serve to produce news by them and for them.
3622 Canada World touts its innovative use of VOD to offer programming in 40 languages. They believe that this will provide the allophone audiences greater choice.
3623 Although subscribers will need the appropriate receiver to access the on-demand programming, and CW will need a licence to provide the service, the real question is what will be available in its non- proprietary curated archive that is not accessible online today. We would argue very little.
3624 Finally, the future success of any multilingual news service will critically depend on its ability to attract, reach and retain audiences in a competitive market. Yet, CW's funding formula with a limited ad revenue projection of $2 million belies the modest degree of success they expect to achieve in that marketplace. We have a different view: advertising revenues can be generated by producing a reliable news service that can attract a significant and desirable segment of the Canadian viewing population.
3625 Another incumbent who has suddenly experienced an epiphany on providing a national, multilingual news service is Bell Media through its OurTV Application. Specifically, they propose to produce a daily newscast in six unique languages originating in three different locations.
3626 Although Bell is quick to rebuke any suggestions that its multilingual news service will simply rely on CTV for its news stories and on Bell Media for the rest of its programming content, a simple reading of Bell's application belies this. Bell plainly states in its Application that its broadcasting resources will be used to ensure a cost-effective delivery of its schedule. It is also obvious that its plans to exhibit a limited amount of news programming in only six languages falls short of achieving the prime objective of this call. TV subscribers should not be roped in subsidizing a giant vertically integrated conglomerate to provide a limited news translation service. While Bell, as a large vertically integrated company, has news experience, it does not have the expertise or experience required to truly engage the ethnic communities, making news with and for them.
3627 For example, their governance structure and Advisory Council framework, given the sheer size of that organization, will largely be ceremonial.
3628 The Amber News Network application suggest that it will broadcast in 25 languages. It proposes to produce and broadcast daily, national 30-minute newscasts in each of Mandarin, Punjabi, Tagalog, Arabic, Hindi and Cantonese. Its newscast will be aired in prime time and repeated the following morning, and it will rebroadcast its prime-time news later that same evening. The balance of the broadcast day will be dedicated to exhibiting various programming genres in 18 different languages. Like the other applicants, ANN has very little experience in producing, delivering and exhibiting a live newscast in multiple languages.
3629 In paragraph 114 of its Supplementary Brief, ANN applauds the Commission's conclusion that there is "exceptional need for a national, multiethnic television service offering news and information programming, including news and information in multiple languages from a Canadian perspective" We cannot agree more. However, by proposing to offer news in six languages and live for only three hours, it is our submission that ANN's proposal fails to meet the Commission's prime objective of promoting a predominantly heavy news and public affairs program schedule in a predominantly heavy news and public affairs program schedule in multiple languages. Its reliance on a $0.30 subscription fee to deliver its program commitments is an expensive alternative for achieving the public policy objectives targeted in this proceeding. The Commission should expect more and Canada’s allophone community demands more from the winning applicant.
3630 Ethnic Channel Group, or ECG, proposes to introduce a technology-based delivery of multilingual news and public affairs programs. The crux of their proposal is to offer programming in 25 languages simultaneously in the fourth year of their licence.
3631 Although this model may deliver translated, multilingual news, it fails to respond to the ethnic realities of those communities. Although a newscast may be broadcast in Spanish, it will not speak to nor reflect the realities and differences of a South American Hispanic Canadian or a Central American or a Spaniard.
3632 This proposal is completely devoid of any real connection to the communities they plan to serve.
3633 Delivering an English newsfeed to a voice-over translator does not respond to the challenges the Commission is trying to address in this proceeding.
3634 What is really required are beating hearts. This is why we are committed to doing live news, using real people -- by and for the allophone community.
3635 Rogers, as its part, proposes to -- a daily national 30-minute newscast in Cantonese, Mandarin, Spanish and Arabic, Tagalog and Punjabi, and 6 hours of locally reflective news programming each from the 3 major cities. It will continue to rely on external sources for this programming.
3636 Rogers’ proposals fall significantly short of what the Commission expect and what is demanded of a 9(1)(h) licensee.
3637 OMNIs news in 6 languages would largely be outsourced implying that Rogers will have very little direct connection to, and reliance on, the ethnic communities it plans to serve and, of course, limited appreciation for their needs, views and opinions.
3638 As for the remainder of the ethnic programming, again, it’s déjà vu, a hodge-podge of nostalgic, random and repurposed programming which, in many instances, is readily accessible via the internet or through other ethnic broadcasters.
3639 The Commission has seen this picture before from Rogers. There is very little new here that warrants the Commission giving this application any serious consideration for a 9(1)(h) licence.
3640 All the criticism that Rogers garnered prior to and in this proceeding over the quality and relevance of its service, especially as sit relates to its commitment to news, is fully warranted.
3641 As stated by Telus, and I quote:
3642 ”Granting a mandatory distribution order to a vertically integrated media company merely would add to the already significant market power of that entity, upsetting what competitive balance there is left in Canada’s broadcasting ecosystem.”
3643 We completely concur. This is the place and time for an independent voice that is embedded in, and entirely focussed on, the Canadian ethnic communities.
3644 Those are our submissions. Thank you very much for your attention.
3645 THE CHAIRPERSON: Thank you. Thank you very much.
3646 Counsel, any questions? No.
3647 I thank you very much for your reply.
3648 Madam -- I lost our Secretary.
3649 In lieu of -- we will take a 10-minute break right now. Thank you.
--- Upon recessing at 9:44 a.m.
--- Upon resuming at 10:07 a.m.
3650 THE SECRETARY: Order please.
3652 THE SECRETARY: So, Mr. Chairman ---
3653 THE CHAIRPERSON: Now who’s running the proceeding?
3655 THE SECRETARY: So, Mr. Chairman, we thought we were done with Phase 2 but we have the ICTV panel in front of us and we’re going to hear them for Phase 2 before we start Phase 3.
3656 So please go ahead. You have 10 minutes.
PRESENTATION / PRÉSENTATION
3657 MS. LUDSKI: Thank you so much, and I apologize again. I had stepped out when our name was called. I really appreciate this opportunity.
3658 Good-day, Chairman Scott, Commissioners Simard and Laizner, Madam Secretary and CRTC staff. Again, we thank you.
3659 My name is Zoe Ludski, I’m on the board of directors for ICTV. We’d like to take a moment and acknowledge again that we are on Algonquin territory and to acknowledge the continued resistance and struggle of indigenous people.
3660 In the light of the problematic history of corporate-run ethnic television, ICTV believes the non-profit model of Tele-1 is the only way to deliver on the laudable goals of the CRTC under the current notice and guarantee transparency for how public funds are used.
3661 Yesterday, the Commission asked ICTV for a specific example of how ethnic media is harmed by corporate control. ICTV points to the ample evidence on the public record, including the history of corporate-run ethnic television in Canada.
3662 In issuing a new licence for a national multilingual, multiethnic television service, the Commission should consider its already established standard of granting 9(1)(h) mandatory distribution orders with these only to not-for-profit media organizations.
3663 Currently, APTN, AMI, TV5, CPAC and Vues et Voix are all not-for-profits dedicated to providing access and reflection.
3664 The licensing must be not-for-profit to ensure service to the community comes before profit. The only exceptions to this rule have been Rogers failed OMNI TV and The Weather Channel.
3665 ICTV presents the Commission with the only not-for-profit application on record and we come to you representing the collective will of ethnic communities from across Canada. The ethnic broadcasting policy approved by the CRTC in 1999 -- framework for ethnic media that fosters opportunities for greater understanding among people with different cultural backgrounds.
3666 This policy objective is impossible without authentic, representative media from these communities and by these communities, and we’ve heard that echoed by everybody this morning as well. And this can only be achieved through not-for-profit governance of the licence awarded by this Hearing.
3667 The Community Media Advocacy Centre has reviewed academic expertise in the field of multicultural broadcasting in Canada to inform needed standards for guaranteeing ethnic media governance is in the public’s interest and for promoting linguistic diversity within ethnic broadcasting.
3668 Based on ground-breaking research of multiculturalism and Canadian television broadcasting policies and practices, Lorna Roth, of Concordia University, concludes greater oversight of the broadcasting system is required.
3669 She observed two decades ago the need for a better approach, writing colour-balanced media requires the actual implementation, supervision and monitoring by the CRTC of Section 3(1)(d)(3) of the Canadian Broadcasting Act by people whose minds are open to the recognition and practice of equal rights for minority communicators in Canada.
3670 The Ethnic Broadcasting Policy has not produced the practices outlined in the CRTC framework for ethnic media or advocated by -- advocated for by Professor Lorna Roth for producing colour-balanced media in Canada. She defines a colour-balanced media -- all levels of the broadcasting system reflect accented voices and culturally racially diverse people of all colours.
3671 More recent scholarship by Sherry Yu of the University of Toronto points to the instrumentalization of ethnic media, or the strategic use of ethnic media as an instrument to serve the interests of stakeholders rather than the general public.
3672 For you, practices by the failed OMNI chain reveal that there are limits to the commercial sector’s relative capacity to serve ethnic minorities.
3673 Yu’s research points also to a lack of intercultural dialogue within ethnic media where ethnic media delivers news about broader society to their respective communities but not necessarily hears about other ethnic communities, and a need for ethnic news in Official Languages where ethnic media typically is not accessible to a broader audience because its content is primarily in third languages other than English or French.
3674 Given these gaps, Yu observes:
3675 ”Ethnic media has been considered as an add-on at best rather than part of the broader media system. And the discourse they produce is considered valuable and worthy of monitoring but not worthy of wider distribution in the broader public sphere. This narrow sense of public discourse in which their discourse is set apart from our discourse is detrimental to our democracy.”
3676 MR. MAROUF: ICTV believes ethnic media as specifically multilingual, multiethnic broadcasting must be reclaimed from corporate control, to end the instrumentalization of ethnic media or the for-profit practices by private stakeholders.
3677 The CRTC needs to preserve the public interest by implementing and monitoring a standard for not-for-profit governance of the 9(1)(h) licences, as is the norm, and therefore guarantee public and financial accountability. Additionally, the above research highlights the need for the Commission to consider upholding the policy and the Act by ensuring a standard that promotes intercultural dialogue by broadcasting a diversity of languages, including news in English and French.
3678 OMNI's failure to deliver on the requirements of the ethnic licence is not an anomaly. A brief history will clearly show how challenging these corporations find ethnic media. The station known today as ICI‑Montréal started in the 1980s as the La Télévision Ethnique du Québec, TEQ, a public access ethnic station. This station did not deliver on its ethnic programming goals, and in 1999, Western International Communications bought CJNT and branded it as a multicultural station with 60 percent ethnic programming and 40 percent American programming.
3679 CJNT was bought by CanWest in 2000 and did not have enough time to deliver on the conditions of licences before CanWest filed CJNT bankruptcy papers, rebranded the station as CH, and applied to change the conditions of the licence to reduce the ethnic programming quotas.
3680 By 2009, CanWest sold the station to Channel Zero, who rebranded the station as Metro 14 and again did not deliver on the ethnic programming requirements of the licence. In 2012, Rogers purchased CJNT from Channel Zero and applied to change the conditions of the licence to drop the ethnic programming requirements and to convert the station to a conventional English service.
3681 During the public hearing for 2012-697, Rogers announced its support of the licencing of an ethnic -- new ethnic television service in Montréal of CFHD-DT, what we know now as ICI‑Montréal. At the public proceedings, Roger's promised a donation of 1.07 million in funding as well as free access to 200‑hours a year of programming from Rogers' ethnic OMNI Television Network. In addition, Channel Zero promised CFHD-DT a one million loan and free master control service for 5‑years.
3682 In 2012, the Commission approved both applications. CRTC 2012-696 created CFHD-DT under these conditions, and CRTC 2012-697 converted CJNT. The later became the first decision in CRTC history to approve an over-the‑air television station to change licence formats.
3683 ICI‑Montréal began airing programming in 2012 under independent ownership. This year, OMNI acquired all the ICI‑Montréal content and rebranded the feed as ICI‑Québec to fulfill its licence extension conditions.
3684 Less than two months into the license extension decision, Rogers applied to reduce its Québec feed requirements for local independent produced content from 14‑hours per month, to 14‑hours per week, claiming clerical error. The Commission refused the change.
3685 At the same time, two Part 1 complaints of non‑compliance were launched against OMNI for outsourcing all its Cantonese and Mandarin news production to Fairchild Television. The complaints, one from UNIFOR unions representing the workers at OMNI, an unprecedented situation, and the other from the Urban Alliance for Race and Relations and the Chinese East Asian Legal Clinic, correctly pointed out that OMNI is in breach of its conditions to produce this content in‑house.
3686 These complaints are on the public record at the CRTC less -- they were on the public record than a month from the licence conditions into -- came into effect. The results of this condition breach are far reaching -- elimination of tens of jobs, and decreasing diversity in news programming.
3687 MS. LUDSKI: Unfortunately, the underrepresentation of visible minorities in mainstream media is exacerbated by marginalization of ethnic media in CRTC policies and broadcaster policies. Some studies point to instrumentalization of the sector or the use of the ethnic media to benefit corporate stakeholders rather than serve the public interest.
3688 The governance structure of the other applicants, corporate boards with appointed advisors from select groups, reproduces what we have historically seen in Canada as ethnic media. To licence one of these corporate groups would be guaranteeing that ethnic communities would have no access to governance or decision-making power, and that the public, who will be paying for the service, will have no accountability or transparency of what their money is supporting.
3689 The unique application of ICTV guarantees not only the public accountability through transparent finance and governance, but also a place for ethnic, Indigenous and community members living with disabilities to be a genuine part of the governance of the organization.
3690 The structure of our Board ensures the most diverse representation of people living in Canada and with genuine empowerment to decide how our stories will be shared, not only within our own languages and cultural groups, but with the greater population in the country, regardless of ethnicity.
3691 Our voices have been marginalized for long enough. To licence yet another corporation whose responsibility is to its shareholders and not our community members will repeat a dismal history. Our community members, our youth can not wait another few years to see if one of these corporations will have a change of heart and suddenly start to prioritize our voices over their dollars.
3692 With ICTV, we begin our application here, as the other 9(1)h licences should, with a dedication to community service not to personal pocketbooks. We do so because our youth require it. Our accurate portrayals of our people and a space where we can recognize ourselves as a part of the greater whole, then our communities will flourish. This empowered representation will have long-term effects that will be felt in all communities in Canada as others hear and see our perspectives over time. MR. MAROUF: Through Tele1, we will all learn more about our diversity, which inevitably leads to seeing what our communities are, and commonalities are. The ability to share cross cultural conversations will strengthen our society, our social cohesion as we learn about each other and work towards common goals. Thank you very much.
3693 THE CHAIRPERSON: Thank you. Thank you for your submission again.
3694 Counsel, do you have any questions? No?
3695 Then thank you.
3696 That concludes this phase, and I'll turn it back to the Hearing Secretary. Madam la secrétaire.
3697 THE SECRETARY: Thank you, Mr. Chairman.
3698 So this concludes officially Phase II of the hearing. We will now proceed with Phase III in which intervenors appear in the order set out in the agenda to present their intervention.
3699 I have not seen Fairchild Television. Is anyone in the room from Fairchild? Please, if you are, let me know. I don't think they are here, Mr. Chairman, so we'll have InFAME next on the agenda. And InFAME Inc. is appearing by Skype? There they are.
3700 Good morning. Can you hear us well?
3701 MS. SHIROKOVA: Yes. Can you hear me?
3702 THE SECRETARY: I can hear you very well.
3703 MS. SHIROKOVA: Excellent.
3704 THE SECRETARY: What about Mr. Canales? Can you hear us?
3705 MR. CANALES: Yes, I can hear you. Thank you very much.
3706 THE SECRETARY: Perfect. So Panel is here -- is ready to hear your presentation. Please go ahead.
3707 MS. SHIROKOVA: Thanks a lot.
PRESENTATION / PRÉSENTATION
3708 MS. SHIROKOVA: Good morning, Mr. Chairman, Vice-Chairs, and Commission staff.
3709 My name is Valeria Shirokova, and I am the Founder of InFAME Inc. that seeks to develop a first of its kind televised multicultural art and entertainment competition between numerous ethnic communities in the four main categories: fashion, art, music, and entertainment. I am also an event producer, digital marketing entrepreneur, musician, and an aspiring screenplay writer. I have a specialized honours degree in Political Science from York University, with an interest in international affairs. I am a proud Russian-Canadian, and I am fluent in Russian.
3710 I have Manuel Canales with me today, who is a consultant that has been in international trade and development since the early eighties with international broadcasting, communications, multinational organizations. Manuel is also the co‑founder of The Media Group Inc., a Canadian private corporation that holds several subsidiary marketing and development companies, and that is dedicated to bringing -- to bridging corporate culture and opportunity sourced among well-funded mature companies in the broadcasting, communications, social media industries.
3711 Now, we have submitted four interventions for this CRTC application, and this presentation will address our general concerns and three main suggestions. So we thank you for this opportunity.
3712 In July 2018, our Prime Minister, Justin Trudeau, named Pablo Rodriguez Canada's new Minister of Heritage and Multiculturalism. During an interview on CBC's Metro Morning with Matt Galloway on August the 7th, Mr. Rodriguez discussed the importance of Canadian arts and culture for global export. And I quote:
3713 "We are exporting more content than we are buying in the cultural sector." (As read)
3714 Mr. Rodriguez noted that the biggest challenge we face is how to effectively partner up with people from different cultural communities and how to export more to different markets aside from the U.S., such as Asia, Latin America, Europe, et cetera.
3715 Now, back in February 1999, Global Affairs Canada proposed New Strategies for Culture and Trade Canadian Culture in a Global World via The Cultural Industries Sectoral Advisory Group on International Trade (SAGIT). Members of the SAGIT had examined the impact of international agreements on trade and investment on culture, they concluded that it was time for a new international instrument strategy that would reaffirm the importance of cultural diversity, and the ability of each country to ensure that its own stories and experiences are available both to its own citizens and to the rest of the world.
3716 SAGIT also stated that for a culture to thrive, it needs a supportive distribution system and investment infrastructure, as well as a stimulating environment for creators and artists. We at InFAME ask how can the creators and artists be stimulated and thrive if the programming budgets are so low or frequently misused that low quality content gets produced by most ethnic programs and stations, or even the large stations such as OMNI/Rogers often rely on unpaid content from the producers, further pocketing profits without fair pay.
3717 And what Canadian programming expenditure levels should the ethnic TV stations commit to as to improve their content to be suitable for global export, and hence, more profit. During the application process of this CRTC hearing, there was very minimal attention given, in my opinion, to the important question of content quality versus allocated budget. Numerous applicants mentioned stellar content and better production teams that they are planning to create, and, for example, Telelatino/ATN, mentioned the possibility of getting their proposed CanadaWorld content on CBC’s business-facing automated export sales platform Panora.tv that is in development, to enable worldwide distribution. But that’s pretty much it.
3718 However, how can we ensure that the sufficient levels of allocated dollars actually go to high quality independent content developers without them being short-changed as is the common case right now? A typical ethnic station’s content quality is similar to that of private Youtube channels’. Kind of true. In order for this generation of TV audiences to continue purchasing TV subscriptions, the incentive must go beyond producing just news in every language, which seems the current discussion here and the focus. However, the millennials, for instance, -- and I represent them essentially -- prefer to get their news online because they are on social media anyway, so more dollars should be spent on high quality entertainment and other non-news types of programming to keep their buying interest.
3719 Can the ethnic stations commit to an average of $100,000 per hour fair value rate as suggested by the Canadian Media Fund application process for higher-end productions that would be suitable for export? Because right now some ethnic producers don’t even get paid $1,000 per 10 minute block of content so no wonder they can’t afford doing a better job. How can we ensure that the same Ethnic channel executives don’t continue paying the same producers the same $1,000 while spending extra $10,000 or more per hour from the government funding that should really be allocated to the producers? What is the proposed hourly programming fair value rate that the applicants for this must-carry license are realistically counting on in their budgets?
3720 Now, we obviously understand that Telefilm/Canadian Media Fund caps the ceiling of the money they give -- broadcast envelopes -- for production of Canadian TV content, while not capping the bottom, yet their fair value per hour of production average is $100,000 as per the Canadian Media Fund Business Policies and Diverse Language Programs document. So we are asking the CRTC the following.
3721 First, establish a minimum fair value per hour of production for the approved applicant as a condition of license as to ensure that the content producers are protected and are able to produce higher quality programming that would be exportable globally.
3722 And two, raise the minimum Canadian programming expenditure level to 50 percent as a condition of licence once again, which should not be a big issue for most applicants who proposed even higher percentages, to ensure that in case their proposed financial projections don’t materialize, they do not use the must-carry subscription funding to short-change the content producers.
3723 In 2017, the CRTC’s Conventional Television Statistical and Financial Summaries showed that the total programming and production expenses were $1,258,785,721. And we’re attaching an appendix. This figure represents 78.3 percent of the total 2017 revenue of $1,608,349,336. The Canadian programming expenses totalled $618,249,598, which represents 38.4 percent of the total Revenue. As we have seen from the applicants’ financial projections, their proposed CPE rate is on average 60 percent, which is noticeably higher than the 38.4 percent in the case of CRTC’s 2017 published results that can be used as a benchmark to measure the applicants’ proposals to.
3724 Raising the CPE level as a requirement of licence should be welcomed as a way to entice the independent content producers to create higher quality content, and open doors to new talents. After all, ethnic cameras cost the same as English cameras yet English productions get way more budget per hour than the ethnic ones. Should be production talent missing, there is always avenue of independent international Co-productions.
3725 Now, having been surrounded by numerous talented young content producers and being an aspiring
3726 female-led show producer and screenplay writer myself, I believe that the number one stumbling block in ethnic programming is the lack of funding and not the lack of talent.
3727 In March 2018, the Canadian Media Fund announced its 2018-2019 program budget and guidelines, committing $352 million to be invested in Canada’s television and digital media industry, with one particular key change that is of the utmost interest to us related to the improved gender balance requirement. Incidentally, CMF only contributed $3 million to fund 11 diverse languages projects, as per their November 8, 2018 funded projects announcement. I quote:
3728 “To continue to increase gender balance and as announced in March of 2017, the CMF will require broadcasters to direct a minimum of 25 percent and a target of 35 percent of their respective performance and development envelope allocations to eligible projects where, of all the enumerated cumulative producer, director and writer positions on a TV component, at least 40 percent of the total number of positions are held by women. This is an increase from the previous 15 percent minimum and 25 percent target.”
3729 We did not find any proposed percentage of TV component positions held by females in our intervened applicants’ proposals. We feel that this is an overlooked opportunity for the ethnic TV stations and Canada in general to be supplied with fresh unique content by our growing female talents.
3730 ICTV seems to be the only station that directly mentioned employment equity of 50 percent for women for on-air and off-air positions. However, there was no further clarification whether this included the producer, director and writer positions.
3731 The Canadian Media Fund’s evaluation grid in their Diverse Languages Program Guidelines 2018-2019 shows an assessment criteria for the team component as holding 20 points out of 100. The CMF awards three points for the adherence to the requirement of 40 percent of the cumulative positions on the production and creative teams on the television component to be held by women. While a three percent point loss may not seem like a lot, we feel that it would be of great benefit to our country as a whole to ensure that the applicants include this in their mandates. So we essentially propose to include this as a condition of licence.
3732 The reality remains that the culture and entertainment sectors are still largely male-dominated. More effort should be made to encourage and support female content developers who are absolutely needed to not only produce fresh content designed from a female perspective for female, and also LGBTQ, audiences, but also to serve as smart marketing instruments to drive female-oriented advertising revenues to TV stations. After all, women hold the global purchasing power with them controlling over $20 trillion in worldwide spending.
3733 This concludes our presentation. We thank you for your time and consideration of our suggestions, and we would be happy to answer any questions you may have. Thanks a lot.
3734 THE CHAIRPERSON: Thank you. Thank you for your presentation.
3735 Madam Simard?
3736 COMMISSIONER SIMARD: Thank you, Mr. Chairman.
3737 Thank you for your presentation, Ms. Shirokova. And I understand that Mr. Canales is on the line with us.
3738 MR. CANALES: Yes.
3739 COMMISSIONER SIMARD: Good. So I have a couple of questions for you. The first one I guess is in link with your presentation. So at the end of your presentation you raised the issue regarding the lack of parity in the production industry. I’m just trying to better understand your position.
3740 And so, at this stage are you just raising this lack of, I guess, the fact that this has not been raised in the proposal? Or if I translate it more in a regulatory kind of language, are you saying that it should be part of our consideration?
3741 MS. SHIROKOVA: Yes. This should be part of the consideration. We are suggesting to make this as a condition of licence essentially.
3742 COMMISSIONER SIMARD: Good. Thank you for your clarification. Thank you. Whoops, I’m sorry.
3743 And maybe -- so how would -- so what would this condition of licence be? Like, what would be included in the wording of this condition of licence?
3744 MS. SHIROKOVA: I think I would model it after what CMF has done, essentially. And you know, use perhaps 40 percent or a number around 40 percent or so as a benchmark.
3745 COMMISSIONER SIMARD: Good. Thank you.
3746 The next question is more general. I understand that you have written in support of three applications, Canadaworld TV, OTV, and TELE 1. So I have a tough question for you. If you had to, I guess, pick one, or support just one of the three, which one it would be -- would it be and for which reason? What would be your rationale?
3747 MS. SHIROKOVA: Well, I do believe that Bell Media probably has the strongest case, but if Manuel doesn’t mind taking it on from here on and explaining why. Manuel?
3748 MR. CANALES: Yes, thank you. I think that the best applicant should be the one -- I mean, we’re dealing with English and French broadcasters of -- you know, Bell Media is the largest broadcaster in the country. So there should be parity, number one, in their policies with the ethnic. And if they are willing to give the credits of the value on a per hour basis of production to independent ethnic producers, I think it should go to that station.
3749 In our view, they all did not commit -- they didn’t come in with a committal, in terms of who is going to do this and who’s going to do that. So unless they went by the book and they say, we’re going to have this money, and we’re going to look for the best producers, is the way I understood.
3750 I know news is a big item, but I think that the talent exists and the applicant that gives the continuous chance to the best independent, non-affiliated producing talent on the ethnic communities for a fair value on a per hour basis, should be the one that get the licence. Particularly as a mass carrier licence and this budget comes in from the subscribers, as opposed to any efforts for advertising.
3751 COMMISSIONER SIMARD: Thank you. Thank you.
3752 In your submission, I understand that you indicated, or you put the focus on the OTVs advantageous as like, based on their infrastructure, their news content, and their expertise from CTV and other Bell services. I don’t know if you have listened to other presentations yesterday and the day before, but ---
3753 MR. CANALES: No, I didn’t.
3754 COMMISSIONER SIMARD: No. Because one of the concerns that has been raised is with vertically integrated entities. So some applicants have raised some concern with that, you know, with this regard. So I’m curious to hear what you have to say on that.
3755 MR. CANALES: Well, I, being Spanish myself, I’ve been in this county for 45 years, predominantly working on mainstream media. You know, I have worked on ethnic media, but mostly in mainstream media. And most arguments in terms of how this will work, or will get better, or you know, will give more chance to people that haven’t got a chance, it starts with a budget. So the first instance is you need to be able to sustain a budget.
3756 Now, in the big corporate world it goes to making sure that this budget is going to be sustained for the length of the licence, because there’s changes as it was outlined in the intervention previous to us. You see this whole change from one end, they changed the licence, they changed the budget, they couldn’t make it. They go back to the CRTC and they try to twist and turn on this thing. So if there’s a real genuine effort to be done for the production of quality, you know, television programming, well the budget has to be a big consideration.
3757 So a well-funded company such as Bell, would not only guarantee that, assumeably, but it will also create a more level playing field with the current quasi-monopoly that Rogers OMNI stations have in this level. So, but the emphasis should be that this budget with this large corporation can certainly guarantee better than independent, should be going into independent producers, non-affiliated, in order to maintain this sort of a vertical integration that you are alluding to. You know, we can’t help it.
3758 Now, if they’re an independent group that can represent that, or through the graces of the mass carrier licence, can commit this budget to that particular thing again on the independent production, it will serve purpose as long as they stay the growth of this. Because what is happening with independent groups, and it’s not different with the story on the station in Montreal, but eventually they don’t have enough traction to stay in business and they get eaten up by competition. They don’t have the infrastructure, so hence, they have to change route, our sell out to somebody else.
3759 COMMISSIONER SIMARD: Thank you.
3760 In your intervention, when you say that you support Canadaworld TV application, you indicated that it would be because this application would be at not additional charge to customers. Could you clarify what you mean by that, that it would be at no additional charge to customers?
3761 MS. SHIROKOVA: I believe their application mentioned that this would be -- well, this would be included in the must carry. Obviously, subscription fees. I cannot -- you know what? To be honest with you I don’t recall this, exactly the wording that they used. I apologize for that.
3762 COMMISSIONER SIMARD: That’s fine. I was wondering if it was maybe because it would not be additional charge because the rate would be similar to OMNI regional current rate. Is it the case?
3763 MS. SHIROKOVA: Yes. Yeah, it’s most likely.
3764 COMMISSIONER SIMARD: Okay. Good. Okay. Those were my questions. Thank you very much for your intervention, both of you.
3765 MS. SHIROKOVA: Thank you.
3766 MR. CANALES: Thank you for the opportunity.
3767 THE CHAIRPERSON: Thank you. A couple of quick questions on my part. One, you mention in your brief today that -- and I appreciate the point that, in your view, we should go beyond producing news in every language and focus on more dollars, I think you said, on high-quality entertainment and other non-news types of programming. And you mentioned that, in your view, news can be adequately obtained from online sources, but I just want to challenge your point a little bit.
3768 So when you say that, do you mean, for example, that Canadians can very easily obtain news perhaps from their home countries or, you know, from different sources? But that doesn’t mean it’s Canadian news relevant to that ethnic community. So I just wonder if you’d like to comment on that?
3769 MS. SHIROKOVA: True. I agree with you on that, of course.
3770 However, I’m coming at it from the Millennials point of view, and the reality is that the instincts of the Millennials right now, and this generation in general, is to do everything online first. Television comes second, right? So it’s much easier to go and type something in Google. My generation doesn’t care whether, you know, the content is produced in Canada specifically, as long as they’re getting the information there. So that’s the rationale essentially.
3771 THE CHAIRPERSON: I guess for the Commission, we do care where it’s produced. That’s kind of our job.
3772 MS. SHIROKOVA: Of course, but I was talking about the general mass population, and these are all my friends, people that I know around me, they -- it’s the reality; they don’t really care as long as the content is there. They really don’t care who it’s coming from as long as it’s valid, as long as it’s truthful. I mean, obviously they care about the source. That’s a whole different conversation, but as long as the relevance and the truthfulness is there.
3773 THE CHAIRPERSON: Okay. I understand.
3774 And then I have a more kind of granular question. You proposed a couple of conditions of licence. How would the Commission operationalize your proposed requirement, for example, of setting a fair value per hour of production? It’s not clear to me how we would operationalize that.
3775 MS. SHIROKOVA: Manuel?
3776 THE CHAIRPERSON: How would we enforce an operationalized condition of licence to the effect that there should be a fair value per hour of production?
3777 MR. CANALES: Well, I think that the Telefilm Media Fund are trying to do the best they can in terms of doing that, and they’ve done a wonderful job on the English and French, including minorities and Aboriginal. They’re a little late to the party on ethnic. I mean, we’ve had ethnic broadcasting in this country for, I think, well over 40-50 years perhaps. You know, I don’t know when Channel 47 was just launched back in the day, called OMNI today. And there hasn’t been any attention to this aspect and to that.
3778 I had a conversation with them for over an hour and I went over all their policies as indicated in the brief. They seem to capt the upside of the bottom part. So if somebody was going to propose $500 or $1,000 or even $10,000 an hour in an application, it’s likely it may be accepted if it fits into the other regulatory puzzle.
3779 And I think this is what controls the Canadian content in terms of that. Now, not all of this content is being channelled through the Canadian Media Fund because they only deal with the eligible broadcasters that have envelopes and so on and so forth.
3780 I think to directly answer your question, if a national broadcaster of recognition was going to be licensed, they publish every year, under the CRTC mandate, a corporate report which is seen and to the CRTC. In that report, perhaps they can give a report on the cost per hour invested in independent ethnic production, and I think that that would serve as a barometer for the CRTC in years to come to maintain the quality, have certain parity with the English production. As it’s well noted in the presentation, you know, the costs are similar on ethnic, if not more expensive than they are in the English production due to linguistic situations. But I think you need to have some kind of a barometer that maintains that the quality is there and is invested so you would be able to get your statistics and be able to track it. And if you need to correct it into a higher rule at a later date, well, then you have the basis because you’ve been tracking it at least.
3781 THE CHAIRPERSON: Okay. Thank you.
3782 Those are all of our questions.
3783 Madame la secrétaire?
3784 THE SECRETARY: Thank you, Mr. Chairman.
3785 I will now invite TELUS Communications’ panel to take place, please. So when you’re ready, please go ahead.
PRESENTATION / PRÉSENTATION
3786 MS. MAINVILLE-NEESON: Thank you.
3787 Good morning, Mr. Chair, Madame Vice-Chairs.
3788 Thank you very much for the opportunity to appear before you to discuss the possible issuance of a mandatory distribution order, an exceptional regulatory measure, which necessarily diminishes choice and, as a result, threatens the overall health of the Canadian broadcasting system.
3789 My name is Ann Mainville-Neeson and I am Vice President, Broadcasting Policy and Regulatory Affairs at TELUS. With me today are Lecia Simpson, Director Broadcasting Policy and Regulatory Affairs, and on her left is Jeff Yurchesyn, Director of Marketing at TELUS. And finally, on the far left is Mary Sun, Senior Manager of Consumer Products and Content at TELUS and our resident expert in audience measurement.
3790 Consumers in today’s environment want to pay for only those programming services they choose to subscribe to. Increasing this freedom of choice was a cornerstone of the Commission’s Let’s Talk TV policy. Adding to the numerous programming services that Canadians are required to receive before they can exercise their freedom to choose may lead to increasing dissatisfaction with the regulated system. It is for this reason that TELUS submits that the Commission should not grant any mandatory distribution order as part of this proceeding.
3792 MS. SIMPSON: By granting a temporary mandatory distribution order to OMNI, the Commission gave itself the necessary time to consider whether there is in fact a need which must be addressed via this exceptional regulatory support. It should not be a foregone conclusion that a mandatory distribution order must be issued as part of this proceeding. The short-term distribution order granted to Rogers last year should not be seen as having set an irreversible precedent. There is still opportunity for the Commission to consider whether a service which attempts to provide programming for up to 20 linguistic communities still makes sense in today’s broadcasting environment.
3793 So much has changed in the 20 years since the multilingual, multi-ethnic channel model was last reviewed, and the conditions that gave birth to that single-service model no longer exist. Where the system had capacity restraints then, and consumers had a very limited choice for third-language programming, this is no longer the case.
3794 The Commission should recognize the success of its policies in the area of third-language and ethnic content. Since the Ethnic Broadcasting Policy was last reviewed in 1999, the Commission has taken concrete steps to ensure growth in the diversity and choice available in the third-language market. Over the years, the Commission has made it easier to launch Canadian third-language services, and it has also ensured that Canadians are well served with both Canadian and non-Canadian options.
3795 Looking back at how far we’ve come, in 2000, the Canadian system included just five Category A ethnic services and only six foreign ethnic services. Today, our broadcasting system includes approximately 200 ethnic television services devoting a large part of their schedules to third-language programming.
3796 MR. YURCHESYN: TELUS carries over 80 third-language services, in 16 unique languages, and we will add more.
3797 At TELUS, we recognize the market potential of multicultural communities and we also recognize that these communities also have all kinds of choice outside the regulated broadcasting system. There are countless offerings that serve third-language Canadian viewers online, many of which allow much more customization, often at lower prices, than can be found in the traditional broadcasting system. This is the biggest competition that the traditional system faces with regard to third-language programming. There is no longer any question as to whether sufficient third-language programming is available to Canadians; it is now simply a question of where Canadian viewers are going for this programming.
3798 To compete in this sector, TELUS is putting customers first by being a leader in the carriage and packaging of third-language and multicultural discretionary services. For example, TELUS has challenged the traditional packaging structure by introducing new multicultural theme packs, which are available to our Optik TV customers for the same price as English or French-language theme packs, providing better customization of television packages, and ultimately, better pricing.
3799 We know what our customers want and we know that if we don't deliver, they will take their business elsewhere.
3800 MS. SIMPSON: We have looked at the viewership data for third-language services offered on our TV service. Our customers are not watching the OMNI service. However, they are watching the discretionary third-language services to which they have chosen to subscribe. This tells us that the needs of multicultural communities in Canada have evolved and are being met by the dedicated third-language services in the system. There is no longer a need being served by a medley-type service, such as the one being considered in this hearing.
3801 The broadcasting system is already at a breaking point. Consumers are leaving the system or are electing not to subscribe to it in the first place. Despite the growth in the Canadian population, the system has now undergone four consecutive years of decline in TV subscriptions. And Canadians are increasingly dropping Television or traditional TV services in favour of over-the‑top, online content offerings which provide greater choice.
3802 We know that choice is important to consumers. In fact, in our most recent survey conducted in British Columbia and Alberta, the number one frustration most likely to drive Canadians from the regulated, traditional system is having to purchase services they don't want.
3803 In an environment where 20 percent of Canadians say they are either somewhat likely or very likely to cut the cord, according to the Commission's own 2017 Communications Monitoring Report, it is increasingly difficult to market a basic package comprised of services consumers haven't chosen. TELUS is concerned that the addition of another service in the basic package will only add to the perceived lack of choice in the system, which in turn will accelerate subscriber loss, and ultimately further harm the overall health of the broadcasting system.
3804 MS. MAINVILLE-NEESON: Finally, while TELUS submits that the Commission should not licence any of the applicants in this proceeding on the basis of a business model that depends on a mandatory distribution order, in the event that the Commission should decide to provide this exceptional regulatory support, we believe that neither of the vertically integrated applicants in this consultation should receive a mandatory distribution order.
3805 The Commission allowed significant horizontal and vertical integration to occur in the broadcasting sector in order to provide scale and synergies which would facilitate the creation of diverse, high-quality Canadian programming. To now be considering subsidizing these extremely large consolidated media entities would defeat the very rationale for allowing consolidation to occur in the first place. Granting this licence to either Bell or Rogers will not add to the plurality of voices in the broadcasting system.
3806 In closing, TELUS urges the Commission to pause and reconsider the need for what is being contemplated in this proceeding. The many successful policies that have been put in place by the Commission over the last 20‑years have ensured that today, Canadians are well served by an abundance of ethnic and third-language programming services which are available on a discretionary basis.
3807 Thank you, and we'd be now pleased to answer your questions, which Lecia will field on behalf of the panel.
3808 THE CHAIRPERSON: Thank you.
3809 Vice-Chair Laizner? Pardon, Madam Simard. Pardon.
3810 COMMISSIONER SIMARD: Merci, monsieur le président. Bon matin. Good morning.
3811 So in your presentation, you mentioned that vertically integrated means a company should not be granted a mandatory carriage order as a result of this process. You explained briefly why is that. I don't know if you want to add something else, like provide a more detailed explanation why is that.
3812 And also, if I guess you want to explain or give, I guess -- so -- because they are -- some applicants put forward advantages for such a possibility. So other intervenors have commented applicants should have previous broadcasting experience or resources, and synergy could be -- could ensure that they are more efficient and that they could offer a better service. So could you comment on that?
3813 MS. MAINVILLE-NEESON: Absolutely. Thank you for the question.
3814 The concern that we have is that the vertically integrated companies that we have in Canada are extremely large and have extreme market power. To subsidize and to add to that market power will not benefit the broadcasting system.
3815 When you speak of synergies, unfortunately a subsidy is not conducive to really looking and utilizing those synergies and finding, you know, the most innovative ways to achieve goals. Subsidies generally are not conducive to innovation.
3816 The second concern is that ultimately, when the Commission has approved the significant consolidation that it has in the industry, it has expressed significant concerns with the potential for abuse of market power. And I think that by continuing to perpetuate that and grow their market power very much may lead to the Commission losing its ability to properly regulate the entities that it has allowed to grow, and the -- and that's a real danger.
3817 Therefore, there's a reason why the Commission has always advocated for a diversity of voices, and I think this is an area where diversity is to the benefit of Canada.
3818 COMMISSIONER SIMARD: Thank you. You appear to suggest that licencing a 9(1)(h) service to serve ethnic communities is unnecessary, and that by doing so, the Commission runs the risk of increasing the cost of BDU subscriptions for consumers.
3819 I would be interested in knowing what, in your views, would be an appropriate wholesale rate.
3820 MS. SIMPSON: Well, it's our position that there wouldn't be any appropriate wholesale rate because we don't believe that any service should be granted a mandatory distribution order as a result of this proceeding. We think a lot has changed in the 20‑years since a multilingual -- since the ethnic policy was last reviewed, and there are so many services now that are, effectively -- you know, where people are going to get their third-language programming, and some of them do have Canadian news in third languages.
3821 So I think that if you'd like to know what the rate is, we don't have an actual rate that we propose, but we can't -- I'm sorry. Ann, what was ---?
3822 MS. MAINVILLE-NEESON: I might -- just in response to your question. No, we wouldn't propose an appropriate rate. But I'd like to point out that it's -- the cost of the service is not the concern that TELUS has brought forward, but rather, that perception of choice by consumers. And so our concern that by adding this new mandatory distribution order requiring that all TV subscribers receive that service, to us that's the major concern.
3823 The perception of choice by consumers has a very distinct impact and is one of the reasons that -- or one of the surveys that we've conducted that actually demonstrate that consumers' dissatisfaction with the level of choice it is -- is the problem.
3824 So it's not the cost and the burden, although we certainly take issue with the additional continuing costs -- regulatory costs that are imposed on the broadcasting system, but that's not the main issue here, it's that perception of choice.
3825 COMMISSIONER SIMARD: In your presentation, you explained that the technology has evolved, that the habits of consumers have evolved as well. As you know, mandatory distribution is used to ensure the availability of programming that meets the needs of underserved groups in the broadcasting system.
3826 So what do you think -- like do you -- like what is the rationale for you when you say that there is no longer kind of a need for that? Thank you.
3827 MS. SIMPSON: It's not that there isn't a need for third-language programming, or there isn't a need for Canadian programming or news in third languages, it's that they're already are being met. And in fact, when we opened up the applications for this proceeding, we took a look specifically at the viewership of OMNI over the years and then look at OMNI compared to the discretionary third-language services we offer.
3828 And I’m going to pass you to Mary to give you some of the results of what we found there.
3829 MS. SUN: Thanks, Lecia.
3830 So our viewership data shows that customers are not watching the OMNI service. However, our customers are watching the discretionary third-language services that they have chosen. So we found that OMNI ranks very low in terms of viewership. In fact, only 1.7 percent of our customers watch OMNI for more than one hour per month, and note that it’s available for 100 percent of our base.
3831 We’ve also noted that although OMNI is available, it’s not ranked in the top 100 services, whereas other discretionary third-language services our customers have chosen, such as the Filipino channel, PTC Punjabi, are ranked much higher than OMNI in terms of total viewership, especially considering their subscriber numbers are only a very small subset of the base.
3832 So in conclusion, our data does show that our customers watch more programming on the services that they choose to purchases and on the services that they really value.
3833 COMMISSIONER SIMARD: Do you think that ultimately if a licence were issued, that there would be an impact on your customers?
3834 MS. SIMPSON: Do you mean that that would change with a different service?
3835 COMMISSIONER SIMARD: Yes.
3836 MS. SIMPSON: The only indication we have of what can happen in the future is what has actually happened in the past. And we have shown, you know, year over year, a decline of viewership with a steady increase in the services that we offer, also in third languages.
3837 So, you know, it’s hard to comment on what could happen in the future other than to look back.
3838 MS. MAINVILLE-NEESON: Although we might have noticed -- and this is one of the points that Mary was making -- that when consumers have selected, have chosen a programming service, they generally engage with it a lot more. And I think that the -- that has the -- so a mandatory service that’s just available on basic might not garner that same interest, but also, we’re looking at a service that is attempting to serve -- to be everything to everyone, and that is very difficult to hold the engagement of any specific community, where a discrete, dedicated third-language programming service is more likely to continue to engage.
3839 So we believe -- and of course, as Lecia points out, we can’t tell the future; we’re not futurists -- but it would seem to us that that model is something that was created in 1999 or earlier, and really was the outcome of the fact that we had a scarcity of signal. It was an over-the-air television service that had, by definition, to serve many groups all on the single service because of the scarcity of spectrum.
3840 That’s no longer the case in our broadcasting system, and what you’re proposing to licence here is not an over-the-air service. Therefore, it would be on par with any of those other discretionary services. So there’s no reason to believe that consumers would simply rather have a dedicated service that they would engage in their own language.
3841 COMMISSIONER SIMARD: Thank you. Those were my questions for today. Thank you.
3842 THE CHAIRPERSON: Thank you.
3843 Commissioner Laizner.
3844 COMMISSIONER LAIZNER: So I’m interested in your views on the issue of locally reflective news that speaks to ethnic communities within Canada and how they are served without mandatory distribution?
3845 MS. SIMPSON: So we did a cursory look at where you could get local Canadian national news, but also local news, and there are services that do that. And yesterday we were talking -- or I heard a lot of conversation about what local means. Is it local to a community or local to like a geographic community or an ethnic community? And we did find that most of the languages of the services or the newscasts that have been proposed are available in discretionary overt-the-air -- discretionary, not over the air -- television services, third-language services.
3846 We found Fairchild, ATN has local Hindi community events. WOW TV, Talent Vision has Mandarin news. LS Time has Cantonese news, a channel of Punjabi, ATN Punjabi. That’s Punjabi, obviously. Univision has Spanish. And it goes on with the catalogue.
3847 And so I don’t know that people are actually watching those newscasts on OMNI. They might be watching OMNI’s respective channels.
3848 And we also took a look -- we were interested to see if third-language viewers were choosing to also watch English language or French language Canadian news, because we had heard about this or seen this in some of the studies, and we found that subscribers that subscribe to a third-language discretionary service are 60 percent -- more than 60 percent as likely as our overall base to also choose to subscribe and pay for Canadian news packages in English language.
3849 So it’s hard to say why they’re not watching OMNI, but it does indicate that they are watching local news, just not on OMNI.
3850 MS. MAINVILLE-NEESON: And perhaps if I may also add, the issue of news, local news, news that is reflective of various communities, is a broad policy issue that is obviously before you and before Canadian policy makers generally.
3851 And you’ve recently chosen to adopt a policy whereby you will fund local news, you know, creating the new fund, that general redirection of the contribution regime towards local news. And certainly that is also an option that is before you to attempt to address, the news issue for multicultural communities. A mandatory distribution order for this medley service is not your only option and may not be your best option with respect to addressing the news needs of Canadian communities.
3852 COMMISSIONER LAIZNER: Did you canvas in your surveys viewership of over-the-air OMNI?
3853 MS. SIMPSON: Mary, will you speak to that?
3854 MS. SUN: Yes, we do have viewership for all the services we carry.
3855 COMMISSIONER LAIZNER: And what did you find in terms of viewership for the over-the-air service?
3856 MS. SUN: So we do find that when we look at the data, it does show that there’s a year-over-year decrease when we look at the viewership of OMNI in general, both nationally and regionally, when we look at our western region as well.
3857 COMMISSIONER LAIZNER: So, I mean, Rogers has appeared before us and has indicated that the OMNI over-the-air service would be at risk if they can’t also have the mandatory distribution.
3858 So given that situation, what do you think the Commission’s concerns should be in terms of addressing people in ethnic communities who don’t subscribe to a basic cable package and rely on over-the-air services?
3859 MS. SIMPSON: Well, we do -- we have thought about that because those would be what you would consider the most vulnerable of that price, and obviously ---
3860 COMMISSIONER LAIZNER: Yes, that’s what I’m driving at.
3861 MS. SIMPSON: Exactly. And that vulnerability, they wouldn’t be in the system today.
3862 We looked at what was available also online, and not just online from over-the-top, but some of these programming services also have quite a bit of their news and programming on their websites, which makes sense today in a more digital environment. So there is an opportunity for that.
3863 There are also, in the system, 30 ethnic radio stations that devote their time to third-language programming. And I’m not suggesting necessarily that that’s the end-all, be-all of the availability of news, but it is free, and it will continue to be free.
3864 The thing with this proceeding is that Rogers is the only applicant that has those over-the-air channels, and recognizing that they may not -- they may, after 2020, decide to continue to run those channels under the Ethnic Broadcasting Policy and their existing licence and they may choose not to. And we take it as perhaps a positive sign that there were seven other applicants in this proceeding.
3865 Perhaps if Rogers doesn’t want to operate their over-the-air channels anymore, maybe they will put them up for sale and maybe one of those applicants would have interest in that system.
3866 COMMISSIONER LAIZNER: Okay. Thank you.
3867 THE CHAIRPERSON: Just one quick question. Just you talked about how if 91h status were given to either of the vertically integrated providers that it would, in your words, increase their market power. I just wonder -- so if you take OMNI -- Rogers OMNI service as an example, they are in the market at the moment. What would be different? How is their market power enhanced if their application were granted?
3868 MS. MAINVILLE-NEESON: Granted, the fact that OMNI is already in the market is more difficult to make that case for market power. However, you’re subsidizing them so you’re making them stronger as opposed to using the synergies which were supposed to be the benefits stemming from the consolidation that has occurred in the market.
3869 So by subsidizing them you’re potentially bringing in new lines of business. We certainly heard from Bell that there was a whole other profit sector that could be generated from, you know, the online use of their -- of the programming. The possibilities are -- you know, within the company you would have a lot of difficulty to regulate. Once the subsidy goes into the large consolidated company it’s difficult to ensure that that money is going towards the purpose for which it was granted as opposed to the broader entity.
3870 THE CHAIRPERSON: Thank you.
3871 Perhaps one more question. Just I don’t know if you heard yesterday our discussion with TLN/ATN/Corus and a discussion about or a proposal to have a VOD service. What, in your view, would this mean for BDU’s and what comments do you have on that proposal?
3872 MS. SIMPSON: Well unfortunately we did leave the room before the TLN for our own preparation.
3873 A video on demand service -- one of the things that does concern us is the addition of any service, and that could be -- you know, some of the different ones, we’ve heard multiple signal, multiple audio tracks, a video on demand service. The addition of a service that subscribers haven’t chosen is really dangerous we think at this point in the broadcasting environment.
3874 From a video on demand perspective, we would have to look technically a little further into what that means for us. But there is library space. Like there is a limited library opportunity in the system. And we’d have to, you know, know exactly what coming in to ingest that into our system.
3875 MS. MAINVILLE-NEESON: And perhaps I’d add obviously there are costs to encoding and then adding to the system so it’s not a costless approach to it.
3876 But I’d be concerned with the business model around a VOD-based service to the extent that we’re -- as a BDU, which operates a video on demand service, we’re still having to undertake significant marketing efforts to move people -- to move our customers towards the adoption of VOD. It’s not a revenue generating endeavour other than if you’re taking a subscription-based VOD service.
3877 So any advertising and, you know, some foundational elements of this business model might not work if you’re simply VOD-based. So I think the Commission would need to consider that as part of its analysis.
3878 THE CHAIRPERSON: Understood. You mentioned that there would be costs. I wonder if you would be able to accept an undertaking to give us an indication of what kinds of costs and technical issues might be associated with their proposed approach of having mandatory carriage of their VOD offer.
3879 MS. SIMPSON: Of course we would undertake to do that.
3880 UNDERTAKING / ENGAGEMENT
3881 THE CHAIRPERSON: Thank you. That would be helpful.
3882 Counsel, any questions?
3883 MR. BOWLES: No questions.
3884 THE CHAIRPERSON: Thank you.
3885 Then I thank you for your appearance and participation today.
3886 And Madame le secrétaire?
3887 THE SECRETARY: Thank you, Mr. Chairman.
3888 And just for the record we will skip Item 5 for now and we’re ready to hear Mr. Hawkins from -- he’s appearing by Skype. Item 6. So we should be appearing on the screen soon.
3889 (SHORT PAUSE/COURTE PAUSE)
3890 THE CHAIRPERSON: We’ll be with you in one moment.
3891 (SHORT PAUSE/COURTE PAUSE)
3892 LE PRÉSIDENT: Madame le secrétaire?
3893 THE SECRETARY: Thank you, Mr. Chairman.
3894 So, Mr. Hawkins, can you hear us well? Can you see us and hear us well?
3895 MR. HAWKINS: Yes, I can.
3896 THE SECRETARY: So the panel is ready now to hear your presentation. Please go ahead.
PRESENTATION / PRÉSENTATION
3897 MR. HAWKINS: Good afternoon, Mr. Chairman, Commissioners, and CRTC staff, and thank you for the opportunity to speak at this important hearing.
3898 My name is Steve Hawkins. I’m the Local President for Unifor 830M. I represent the 60 unionized employees who work for City TV and OMNI in Vancouver. I’ve been a news camera operator and editor for the past 26 years. My comments today are in support of Rogers’ application for a multicultural 91h service.
3899 Our members work hard every day to produce local news, regional news, and national news for OMNI television. In this time of fake news or yellow journalism I believe the best way to fight the forces is to have well-funded professional journalism.
3900 Local news is at the core of Canadian TV. It’s where most of my members work and where I’ve dedicated my professional life. Local news is not something that should be contracted out to the lowest bidder.
3901 I’m asking the Commission to require Rogers to locally produce all their news programming in-house, including their national Chinese news shows, using OMNI employees as a condition of licence.
3902 Civic function journalism is something Rogers does well. Our members are connected to their communities in meaningful ways and engaging ways. This is the core of civic function journalism, professional journalism. They are invested in taking broadcast news and making it relevant to their community.
3903 We know from experience that only strict and enforceable conditions of licence can achieve the goals of the Broadcasting Act and the Commission’s Ethnic Broadcasting Policy to the benefit of Canadians -- of Canadian multi-cultural communities. Promises, policy expectations and aspirations are not enforceable once a licence has been granted. Only specific conditions of licence can ensure the public interest, as required by the Broadcast Act, is upheld.
3904 Canadians deserve certainty and enforceable conditions of licence ensure that large, vertically integrated companies will live up to their commitments in exchange for the use of the public airwaves.
3905 Thank you for your time today and I will take any questions you might have.
3906 THE CHAIRPERSON: Thank you. Thank you for your presentation.
3907 Commissioner Laizner?
3908 COMMISSIONER LAIZNER: Good morning. I noted that in your written intervention, you mentioned a few other things, as well, in addition to what you’ve spoken to today about producing all news programming in house and I’m wondering if you could give me a little bit more detail about those other issues that you have with respect to transparency and contracting-programming obligations, that sort of thing.
3909 MR. HAWKINS: Sure. Transparency in what regard?
3910 COMMISSIONER LAIZNER: I think you’re ---
3911 MR. HAWKINS: If you make specific reference to them?
3912 COMMISSIONER LAIZNER: Yeah, the reference you made in your intervention was transparency on the use of 9(1)(h) funds and the mandated wholesale rate, so I just want to understand what you mean by that.
3913 MR. HAWKINS: Well, once the funds, you know, go into a large vertically integrated company, the reporting seems to be between the CRTC and the broadcaster and when I’ve made attempts in the past to get any of that information, it seems to be held as confidential or, you know, market information, so some sort of a more open process in letting that information -- seeing where those funds are going and ensuring that they’re doing what they say they’re doing would be, I think, helpful.
3914 COMMISSIONER LAIZNER: Okay. And were there any other matters that you wanted to address before us today or is basically what you’re talking about is the concern you have that production be centered in the communities where the news is taking place?
3915 MR. HAWKINS: Yeah, I mean, but right now, we’re talking about the 9(1)(h) and other comments that I’ve made in the past relate to the over-the-air systems and that certainly puts Rogers in the advantage to -- because it has the over-the-air TV systems and that -- and that’s where we had numbers and when they got the 9(1)(h), which we were supportive of, we did, you know, growthe -- our ability to cover ethnic news in Vancouver and that -- that’s what I’m speaking to.
3916 I know that Howard and Angelo are going to be speaking to the issues of a fair wage policy, and they might also have something additional as far as transparency in reporting and I certainly work with them. We share information and then that’s where some of the frustration might come is when we collectively try and get this information. It has been difficult in the past.
3917 COMMISSIONER LAIZNER: Okay.
3918 MR. HAWKINS: And, you know, I know that earlier in the proceedings, there was talk about the makeup of the advisory councils and I have reached out and I think that it might be something that the Commission could consider is to have a worker rep or an employee representative that’s part of those councils; somebody outside of the Rogers management team that -- you know, that -- not to overuse a cliché, but the feet-on-the-street people that are doing the work that are connected in the day-to-days that could, you know, have a very meaningful input to advisory councils as far as what’s, you know, realistic and ideas, things that have worked in the past; that sort of thing, you know.
3919 I’m thinking of the Chinese New Year celebrations and the way that OMNI’s had a, you know, a very positive influence on those large community events. The same thing with Misaki and other festivals.
3920 You know, it’s our members that are on the street that are engaging community, but -- and, you know, myself, as a news camera operator, I principally work for CITY TV but, you know, it’s not uncommon my talking to somebody from the Punjabi community to engage them and ask them to give me their response in Punjabi and that’s something that an awful lot of other people that have been, you know, putting themselves out there as part of this process might understand is that there are advantages to having more feet on the street that a company like Rogers is able to do.
3921 COMMISSIONER LAIZNER: All right. Thank you very much. Those are my questions.
3922 MR. CHAIRPERSON: No? Then I thank you very much for your contribution to the proceeding.
3923 Madame le secretaire?
3924 THE SECRETARY: Thank you, Mr. Chairman. We’ll now go back to Item 5, Unifor, so please come forward.
3925 (SHORT PAUSE/COURTE PAUSE)
3926 THE SECRETARY: Sorry about that. Please go ahead when you’re ready.
PRESENTATION / PRÉSENTATION
3927 MR. LAW: Good morning, Chairman and Commissioners. Thank you very much for the opportunity to appear before you.
3928 Yeah, my name’s Howard Law from Unifor. We’re the country’s largest private-sector union. We represent 315,000 Canadian workers including 12,000 journalists and media workers.
3929 As the national representative for Unifor, I’ve had the unique privilege of representing people who work in the third language and multi-ethnic media and as our media director, I’ve also appeared before you in the past advocating on public policy issues concerning local news, specifically, but also broadcasting generally.
3930 I’d like to introduce Angelo Contarin. Angelo is the President of Unifor Local 723m which represents Rogers, CITY and OMNI employees in Toronto. Angelo is a video editor who’s among about a hundred Rogers media workers employed in the OMNI operation across the country.
3931 You already have on record our mercifully short submission suggesting how you might evaluate the eight different applications before you. We could summarize our submission in three points:
3932 Number one, prioritize each applicant’s ability to deliver on high-quality local news by the licensee in house. Two, insist on a fair employment policy for the successful applicant. Three, lock it all down in the conditions of licence.
3933 Let me start with the last point. Everyone in the room and certainly the Commission understands what’s happening to the industry’s legacy business model based on advertising revenues paying the lion’s share of programming expenditures. Ad revenues can and likely will get worse and it’s not fanciful to imagine operational adjustments and improvisations being made by the successful applicant during the licence term.
3934 That is why, in our humble opinion, we need an experienced and well-resourced broadcaster at the helm. But it’s also why the public interest demands that quality programming not be watered down as a result of changed circumstances. Certainly, the mandatory subscriber contributions will not be watered down. That is why we believe that the conditions of licence must -- that COLs must pin down everything the Commission considers material to broadcaster performance.
3935 With regards to those COLs, let me just focus on two areas. As we said in our submission, the core of the programming should be news and the local component should be produced in house. The best guarantee of that high-quality programming is for the licensee to be a hundred percent in control of news programming -- news gathering. That begins with the hiring of journalists, training them, retraining them if necessary, directing their work throughout the day, helping them make important news judgments as stories develop during the day, and making the hands-on development of that journalist human resource as a priority.
3936 In television, reliable journalism has to be your brand, but it’s also your bond. You can’t contract out quality control.
3937 We believe it should be a condition of a licence for local news and that should be expressed as a COL, defining local presence as staffing by a sufficient news core of TV journalists -- we’re talking reporters, camera operators, videographers, editors -- to cover stories important to the third-language communities covered by the licence and, secondly, a condition of licence prohibiting the contracting out of any production of local news programming to third parties.
3938 Let me turn to the point of fair employment policy. Commissioners, it’s imperative we have a fair employment policy as a corollary to the condition of licence for in-house news production.
3939 The Rogers proposal to partner with Fairchild to produce local news demonstrates why that is necessary.
3940 I can tell you as the Union Rep who organized the union in Toronto’s three Chinese-language newspaper dailies beginning in 2001, and then negotiated their union wage rates, the labour market for Chinese media employees is a captive labour market. The non-union wage rates would shock your conscience.
3941 The fact is that if you’re a functionally unilingual journalist or media worker in any ethnic community, including the Chinese community, your employment options are significantly narrowed by your lack of English proficiency. Owners of ethnic media operations know this.
3942 Le labour bargain that results is exactly what you would expect. The labour rates at Rogers/OMNI and the three unionized Chinese language papers in Toronto are quite good. The union changed the employment bargain.
3943 For an example, an experienced journalist at OMNI’s Toronto or Vancouver operations earns from $60,000 to $70,000 plus a solid package of benefits. I’ll bet coffee with anybody in the room that the rates at Fairchild are far lower, likely half.
3944 It is not acceptable that a media owner enjoying a stream of subscriber revenue levied by mandatory contributions should be in a position to exploit the economic vulnerability of its employees in the very community to which it’s broadcasting its programming.
3945 The Broadcast Act explicitly supports a fair employment policy in section 3(d)(iii) when it refers to employment opportunities arising out of its operation.
3946 We are unable to find a Commission precedent where there has been -- where that language has been applied in a significant manner to employment in broadcasting. Nevertheless, the language regarding employment opportunities means something, and in our submission, it should be applied -- if it should be applied anywhere by the Commission, it should be applied here in the manner we’re suggesting, where programming quality and fair conditions converge.
3947 Therefore, we submit that you should require all applicants file, as an undertaking, a fair employment policy that addresses compensation issues and that the obvious benchmark for compensation should be the Unifor/OMNI Collective Agreements and that such a policy be made a condition of licence for the successful applicant.
3948 Those are our comments, and before we turn to any questions you might have, I would ask your indulgence to watch this two-minute video, which we hope illustrates the importance of high-quality local news in this licence proceeding.
3949 (VIDEO PRESENTATION/PRÉSENTATION VIDÉO)
3950 THE CHAIRPERSON: Thank you for the presentation and the video. I have a couple of questions, if I may.
3951 In both your intervention and again today in your oral comments you reference section 3(1)(d)(iii) of the Act which addresses employment opportunities, and you propose conditionals, and the objective of which obviously is to maintain high levels of local news content, an objective we share.
3952 But the Act also talks about the importance of the independent production sector. So I wonder if you can suggest or add some further detail as to why you think we should be looking more or less exclusively at one at the expense of the other, understanding your concern is with contracting out, but I would just like you to try and juxtapose those objectives of the Act.
3953 MR. LAW: Well, let me respond with two points. The first point is that certainly in all the applications, the role of independent producers in providing non-news programming will be very strong, and I think all the applicants have detailed to you how they propose to do that, and we don’t take any issue with that whatsoever. And we do think that meshes appropriately with the objectives of the Act.
3954 In terms of news, however, our very strong view is, and it’s always been in many proceedings, that the best way to deliver high-quality programming in news is through professional journalism.
3955 One of the things about professional journalism is it has to be experienced. And honestly, to put it very candidly, you can’t cheap out on professional journalism. That’s why it’s very important, number one, to have your own journalists. And that was the point I tried to make in my opening remarks.
3956 Number two, if you try to -- if you pay bottom dollar for journalism, you will get what you pay for. And that’s why we think that a fair employment policy is good for programming, and obviously it’s fair to the employees. And we think that both of those objectives are in the Act.
3957 THE CHAIRPERSON: Still, we have to balance these things.
3958 So what policy objectives do you think would be achieved by prohibiting any subcontracting?
3959 MR. LAW: The policy objective would be making sure that the citizenry, the audience, gets the best possible local news. And without going on a long dissertation about that on points I think we already agree about, the news is -- when we say at the end of our video “news it’s essential to democracy,” I think everybody is on the same page as that, and I think that the Commission has stated that in previous decisions in the local programming decision, for instance.
3960 The polling that’s been done both by the CRTC and by Unifor and Friends of Canadian Broadcasting through Nanos shows that in terms of audience preferences, that local news is by far the highest rated Canadian content in the system, in the range of 80 or 90 percent importance versus much lower figures for sports and entertainment. So that’s what the public expects.
3961 And it’s also sort of a no brainer that, you know, especially with the communities we’re talking about, where the audience is trying -- where the citizens who are watching or the residents who are watching are trying to move up the learning curve about Canada and about Canadian politics as quickly as they can to catch up to everybody else, that it makes sense that you have to have absolutely the best and I would argue it's counterintuitive to think that you can do that if you're contracting out to an organization that is not as committed to you are as providing -- as the licensee to providing high quality journalism. It -- there are -- you know, companies contract out all the time, but they rarely contract out their core mission.
3962 THE CHAIRPERSON: Okay. Thank you. While we're on conditions of licence, you also recommend a condition allowing only a small percentage of the subscriber tariff could be spent on online programming, as opposed to cable programming.
3963 Can you comment on that? And in particular, I'd just like some further understanding of why that's a reasonable condition? What would be the amount, and perhaps some explanation?
3964 MR. LAW: I think what I'd like to do is maybe back away a little bit from those comments in our brief that were written a few months ago. The only concern there is that an applicant might come in and really have a -- really be a webcaster, rather than a broadcaster, and see this an opportunity to finance their webcasting operation.
3965 Certainly, we're not concerned about any broadcaster that wants to repurpose their content in a parallel online product, so -- and I think that all of the applicants are thinking about that. But since cable subscribers are in fact paying the bills, it should be a -- you know, a cable first operation.
3966 THE CHAIRPERSON: Okay. So just to be clear, so you're not proposing it anymore as a condition of licence? Or -- and if ---?
3967 MR. LAW: I think it's worthy of considering, but I wouldn't -- you know, I wouldn't put it in my top five.
3968 THE CHAIRPERSON: All right. You also, in your intervention, speak to the need for the prospective licensee to have the scope and the resources to fulfill all the promises in their application. Given that you've recommended -- you've supported one of the applicants ---
3969 MR. LAW: Sorry. I should be clear. We don't -- we haven't endorsed any of the applicants. But we do obviously represent the employees at Rogers and ---
3970 THE CHAIRPERSON: You ---
3971 MR. LAW: --- we don't want to see them lose their jobs ---
3972 THE CHAIRPERSON: Yes.
3973 MR. LAW: -- and we think there's a good application from Rogers.
3974 THE CHAIRPERSON: Understood.
3975 MR. LAW: Yeah.
3976 THE CHAIRPERSON: Do you think that vertically -- that non‑vertically integrated applicants then are at more risk than others in terms of their ability to fulfill a licence -- conditions of licence?
3977 MR. LAW: The whole VI thing, I think has become a bit of a political football here. The -- what matters is scale and resources. And there is at least -- you know, I am not intimately familiar with the capitalization of some of the non‑VI applicants here, but -- and if they have the scale and resources to do the job, being a VI or not being a VI should have nothing to do with the strength of their application.
3978 THE CHAIRPERSON: Okay. And -- well, how would you suggest, then, or what do you think are the most important considerations as the Commission balances the question of increasing the diversity of voices versus certainty about the size, scale, and scope of the prospective licensee?
3979 MR. LAW: You see, I don't think that we would buy into that question in the sense that it's not an either or a trade-off. The diversity of voices is in the content. It's how well you're bringing out the diversity of voices in the content.
3980 So you know, clearly some of these new applicants have brought a -- both a diverse and experienced leadership team, but I think both the VIs could say the same thing. I think what's important is how are they going to serve the community and find the diverse stories and bring them out. That would be our view of -- it's not really a trade-off.
3981 THE CHAIRPERSON: I think for the Commission it's more -- a diversity of voices is more than the content, as we've expressed throughout the course of the hearing.
3982 MR. LAW: Yes, and so I probably can't help you on that.
3983 THE CHAIRPERSON: Not a problem. Those are my questions.
3984 MR. LAW: Could I just say on that?
3985 THE CHAIRPERSON: Yes.
3986 MR. LAW: I mean, we did -- the only contribution to that discussion that I think we've made is in our brief about the editorial advisory boards.
3987 THE CHAIRPERSON: M'hm.
3988 MR. LAW: And -- so we, you know, I think that the idea of an advisory council, which some of the applicants have talked about, is an important aspect of bringing the -- you know, tapping the diversity and tapping the experience and input from the communities they're serving.
3989 We also think it might be useful to have an editorial board because there is always the -- and this really goes to the whole issue we have about professional journalism. There is always the potential for a conflict of interest between the views brought forward through the advisory board and professional journalism.
3990 So you can have a controversial issue in a community, you could have an advisory board saying we don't like those stories, or you're missing a bunch of stories we want you to report. The function of an editorial advisory -- editorial board would be to say, thank you, we're going to consider this and we're going to govern ourselves in according to, not only what is good coverage for the community, but what's -- but what is a -- you know, how -- we have a strong and independent press. Because in the end, when it comes to the local news, that's what the broadcaster is responsible for.
3991 A bit of a digression. I apologize.
3992 THE CHAIRPERSON: Do you have an example of that, or is that just a potential concern?
3993 MR. LAW: It's a potential concern.
3994 THE CHAIRPERSON: Okay. Thank you. Those are my questions.
3995 Commissioner? Madam Simard?
3996 COMMISSIONER SIMARD: Thank you.
3997 A quick question. In your view, is a job description for a journalist covering news, like in general, is the same as a job description for a journalist covering news for specific communities?
3998 MR. LAW: Sure. I understand the question. I mean, obviously -- I hope I'm answering the question.
3999 The job of a journalist and the sort of the broadcaster that we're talking about here is obviously going to require real experience and roots in the community. And I think -- you know, I think a number of the applicants demonstrated why that's important in order to cover stories meaningful to the community, as opposed to, you know, what I would call "rip and read", or -- which is, you know, you have somebody else's journalists tell you what's important and you use their content because that's all you've got, as opposed to using your own journalists who you can depend on to root out the stories that are really special in the community.
4000 COMMISSIONER SIMARD: Thank you.
4001 THE CHAIRPERSON: Any questions from counsel?
4002 MR. BOWLES: I have two relatively quick questions for you.
4003 Just to confirm for the record. You referenced the -- setting as a benchmark for the employee policy and the compensation package the UNIFOR/OMNI collective agreement. Can you specify for the record whether there was any Commission involvement in -- between those agreements?
4004 MR. LAW: Any Commission involvement?
4005 MR. BOWLES: Yeah.
4006 MR. LAW: No, they were negotiated between the parties.
4007 MR. BOWLES: You speak about -- in your presentation, there was a general comment made about non‑unionized wage rates. To your understanding, is there any impediment for non‑unionized workers to unionize?
4008 MR. LAW: There are lots of impediments.
4009 MR. BOWLES: Could you expand?
4010 MR. LAW: Anti-union activity from the employers.
4011 MR. BOWLES: There's nothing else that you'd like to add to your response ---?
4012 MR. LAW: So the Labour Relations Act provides the legal opportunity for workers to organize. You asked if there were impediments, and the impediments usually are anti-union activity from employers.
4013 MR. BOWLES: And is it your view that those anti-union activities are in conformity with relevant legislation?
4014 MR. LAW: No, they're usually in violation of it.
4015 MR. BOWLES: Yeah. Thank you very much. Those are my questions.
4016 THE CHAIRPERSON: Thank you. Thank you very much for your submissions.
4017 We will break now for lunch, returning 1:15.
--- Upon recessing at 11:53 a.m.
--- Upon resuming at 1:17 p.m.
4018 THE SECRETARY: Order, please. À l’ordre, s’il vous plait.
4019 Just as a reminder, we will have an emergency alert test at 1:55 Ontario time and then 2:55 Québec. So we’ll probably get two. Just make sure you turn off your smartphones, please.
4020 Mr. Chairman, we are ready to hear Shaw.
4021 THE CHAIRPERSON: Just a reminder to folks in the room that putting your phone on airplane mode will not be sufficient. So if you have your cellphone, you need to turn it off during the alert, unless you wish to hear it.
4022 THE SECRETARY: So we are now ready to hear your presentation. You have 10 minutes. Please go ahead.
PRESENTATION / PRÉSENTATION:
4023 MR. SHAIKH: Good afternoon Mr. Chairperson, Vice-Chairperson Simard and Vice-Chairperson Laizner. My name is Dean Shaikh, Vice President, Regulatory Affairs at Shaw Communications. I am joined by Cynthia Wallace, Regulatory Counsel.
4024 We appreciate this opportunity to provide Shaw’s customer-facing perspective as a cable and satellite provider and to assist the Commission with your consideration of whether any of the applicants will provide Canadians with a multilingual, multi-ethnic news and information service that meets the “exceptional contribution” criteria for 9(1)(h) distribution.
4025 Shaw supports the Commission’s objective to ensure that, consistent with the Broadcasting Act, the system reflects “the linguistic duality and multicultural and multiracial nature of Canadian society.” Shaw strongly favours the Commission’s longstanding policies that promote diversity across the system as a whole.
4026 Specifically, programming by and for specific groups is supported by the Commission’s activities and policies, including: the approval of over 190 ethnic pay and specialty services for digital distribution; the ease with which new third-language services can now launch without a licence; and, as a reflection of Shaw’s commitment to diversity, Shaw distributes the Shaw Multicultural Channel (SMC) pursuant to the Commission’s authorization. SMC is carried in Metro Vancouver and Calgary and broadcasts local and international series, currently in 18 languages, with no advertising revenue and no subscription fees.
4027 The Commission has also implemented measures and policies on an industry-wide basis to ensure that cultural diversity is reflected in all broadcast services. Shaw is confident that these mechanisms will ensure that Canada’s ethnic and linguistic communities will continue to be well-served by the licensed system.
4028 We have serious concerns that mandatory distribution of any of the proposed services will fail to serve Canada’s third-language and ethnic communities, while undermining choice, affordability, and flexibility for our customers. A single service cannot meaningfully meet the needs of Canada’s diverse linguistic and ethno- cultural groups and designating one service as responsible for fulfilling such a mandate will be harmful to diversity and choice, overall.
4029 It is not possible for one service to implement a governance structure that is sufficiently diverse to prevent either the exclusion or predominance of certain groups and languages. Nor can a service schedule programming that is: broadly representative of minority linguistic and cultural communities, including newcomers to Canada; relevant to all Canadians across the country; and sufficiently local, regional and national in scope.
4030 Furthermore, Shaw submits that the Commission must avoid creating incentives for Canadians to leave the licensed system. Canadians can and will easily seek alternatives if they are forced to pay for services they do not want or need, ultimately to the detriment of programming diversity. Putting the consumer at the centre of these deliberations means that the Commission must reject any application that will: result in the loss of other services and a reduction in customer choice because of capacity limitations; or impose significant additional costs on Canadians.
4031 The objectives of the Broadcasting Act will be best-served by a regulatory framework that allows BDUs to invest and innovate in response to the demands of Canadians.
4032 As noted by Ethnic Channels Group (ECG) an “inherent limitation” of multi- language services is that “the more languages, the less time per language.” ECG has attempted to overcome this issue by offering a service that will eventually operate in over 25 languages simultaneously using virtual channel mapping, or by employing the Secondary Audio Programming (SAP) feature. Shaw previously investigated virtual channel mapping and determined that it is not supported by our third-party head-end processing and encryption technology. To verify the feasibility of the applicant’s proposal, Shaw performed additional testing, which confirmed that multiple audio feeds sharing a video component cannot be passed through. Our third-party manufacturer has also confirmed that virtual channel mapping is not possible.
4033 Regarding the SAP function, the guide interfaces employed by the majority of our set-top boxes cannot support more than one primary audio feed and two or three secondary language feeds per channel. It is not possible to modify the user-interface of these guides in order to present language options other than the guide’s predetermined languages.
4034 Because of these technical barriers, Shaw would be forced to carry 25 SD video feeds or, theoretically and subject to testing, approximately seven to nine SD video feeds with 3 to 4 SAP languages per channel, with a very cumbersome and inaccessible user-experience. Either would be prohibitive with respect to bandwidth. Shaw would be forced to drop the corresponding number of channels, which would materially limit programming diversity and place Shaw at an unfair competitive disadvantage relative to any BDU capable of employing a less bandwidth-intensive option.
4035 Furthermore, with the resulting loss of services, ECG would fail to satisfy the criteria for widespread acceptability to Canadians.
4036 The applicant for Multicultural Described Video Guide (MDVG) has also proposed to address language fragmentation by embedding multiple audio channels in a single video channel. Unfortunately, it is not possible to “demux” this service without the same prohibitive bandwidth and technical barriers as described for ECG – especially if any video content is present.
4037 During this proceeding, the applicant has emphasized the audio nature of the service. If this is the case, the audio channels would be best provisioned like radio stations, which have no video. Rather than receiving the service with audio signals embedded in a video channel, it would be necessary to receive individual audio channels. With this approach, it may be possible to provision an audio-only service that occupies the equivalent of 1.5 to 2 SD channels.
4038 However, we agree with certain observations that this proposal may not be within the scope of this proceeding for “a national, multilingual multi-ethnic television service offering news and information programming” as the service would primarily provide a described video guide with brief audio-only newscasts.
4039 At the same time, we recognize and appreciate the applicant’s comparatively low proposed wholesale rate and clear dedication to serving the needs of individuals who are visually impaired.
4041 MS. WALLACE: The next issue in this proceeding is the cost impact on customers.
4042 No applicant has provided sufficient evidence of the likely impact of their proposed wholesale rate on consumers and of its widespread acceptability to Canadians. The existence of the price cap on the basic service does not eliminate the need to satisfy the Commission’s financial impact test.
4043 Over the last several years, affiliate fees have increased disproportionately and, following the rate increases granted in the Commission’s recent renewals, 9(1)(h) payments will also increase. These trends are unsustainable. New 9(1)(h) services and further wholesale rate increases will harm our customers by decreasing affordability and slowing the pace of investment and innovation. The price cap on small basic cannot be used as an excuse to continue to add new 9(1)(h) services, while also increasing the costs of existing ones. Inevitably, these increases will necessitate an increase to the basic service price cap.
4044 The Commission must also prevent attempts to exploit 9(1)(h) status as a for-profit business based on inflated wholesale rates or commitments that are entirely subsidized by BDUs and our customers. In this regard, Shaw is highly opposed to the applicants’ excessive requested wholesale rates, ranging from 19 to 40 cents. In particular, Shaw finds it problematic to grant 9(1)(h) status and a regulated wholesale rate to either Rogers or Bell, two of the largest and most diversified media companies in Canada.
4045 OMNI Regional was awarded a licence based on the argument that 12 cents would provide a reasonably reliable revenue stream for the purpose of meeting meaningful programming obligations. Granting any increase from OMNI Regional’s current rate cannot be justified in light of the negative impact on customers.
4046 MR. SHAIKH: The Commission has recognized that to ensure a vibrant domestic broadcasting system in the future, the regulatory framework must adopt more innovative and nimble approaches that reduce the burden on traditional players and reflect the ways in which Canadians engage with content and services. With this in mind, Shaw questions whether 9(1)(h) distribution is the most appropriate tool to ensure that Canada's ethnic and linguistic communities are served within the Canadian broadcasting system.
4047 Shaw favours the Commission's policies that support diversity across the system, and believes these measures should be relied on, together with competition, to efficiently shape how customer demand is met following the expiry of OMNI Regional's mandatory distribution order.
4048 If, notwithstanding these concerns, the Commission finds that there is exceptional need and one of the applicants has met this very high threshold, the objectives of 9(1)(h) distribution must be balanced with, not achieved at the expense of, our ability to meet customers' expectations for choice, value, and affordability.
4049 9(1)(h) licences should be considered a rare and extraordinary privilege, not a business opportunity. At a minimum, it is imperative that the applicants meet BDUs' technical requirements and capacity limitations to avoid harming customer choice, and the wholesale rate is set at no more than 12 cents per subscriber per month in order to avoid imposing additional costs on our customers and further entrenching the regulatory and competitive advantages of unlicensed OTTs.
4050 Thank you. We look forward to answering your questions.
4051 THE CHAIRPERSON: Thank you. Thank you for your presentation.
4052 There's a lot to discuss.
4053 MR. SHAIKH: M'hm.
4054 THE CHAIRPERSON: Let's start with the last, or almost last statement when you say if any of the applicants fulfills or meets what the Commission has indicated is a high bar, they should not receive a rate anymore than 12 cents. So according to Rogers, at the present time, its service would be losing money at 12 cents. So if Rogers is impeded by that rate, are you not effectively saying that we really shouldn't license anyone? I mean, I know that is also implicit in your remarks, but it seems like you're not really saying that it could be licensed at 12 cents. According to Rogers, it's impractical, so what is your view?
4055 MR. SHAIKH: That is a fair question, and in fact, it is our position that no service should be awarded a 9(1)(h) licence distribution order following the expiry of OMNI Regional's mandatory distribution order, in part because of costs. We think it's a clear trend that services are awarded a mandatory order based on a promised rate and certain promised commitments, and then come back to the Commission and ask for more. And even in this proceeding, we were surprised that one of the applicants who proposed a rate of 12 cents, arguing that they could provide a service at 12 cents, even before being awarded that licence started to negotiate that now they need 13 cents.
4056 It's the type of trend that we witness often with 9(1)(h) services. They get their licence and then they come back to the Commission and say we need more, we need more to do more in terms of programming commitments, and often they get those rate increases.
4057 But those rate increases are, let's be clear, and those commitments are not commitments that are based on the services commitments or in investment or innovation or efficiencies by the service. Especially with a price cap, they're commitments that are based entirely on a subsidy from BDUs and their customers. So they promise these commitments, argue that they need an increased rate to fulfill these commitments, but it's entirely at the expense of BDUs and their customers.
4058 Which is why we think it's appropriate that if you decide that there is a service that meets the high criteria, it was originally awarded based on 12 cents, at least one applicant started out this proceeding stating they could do it at 12 cents, we think that that's the bar.
4059 THE CHAIRPERSON: So you -- well, I'll go there in a second. And you -- does it make a difference whether they're vertically integrated or not vertically integrated?
4060 MR. SHAIKH: Well, we don't think vertical integration so to speak is the issue. I think it's more a question of their scope and scale across their media properties.
4061 In the case of Bell and Rogers, they have significant scale, and to the extent that additional investments are necessary, additional subsidies are necessary to actually demonstrate a commitment to third-language and ethnic programming, Bell and Rogers are more than sufficiently well-capitalized to do that.
4062 THE CHAIRPERSON: So you'd agree that the Commission's objective with respect to multi-lingual and multi-ethnic programming is a laudable goal, and you agree that it's okay at 12 cents, but not at more than 12 cents?
4063 MR. SHAIKH: To be clear, we think that the Commissions' objectives for diversity are best achieved with the policies that were in place prior to OMNI Regional being awarded a mandatory distribution order, and we should return to that philosophy where ethnic communities and linguistic communities are well served by the broadcasting system as a whole.
4064 We think that's critical. We think the notion of one service being tasked with this actually undermines diversity. So our position is no one service should be awarded this licence at any rate.
4065 If you determine, based on your analysis, that one service has met the exceptional criteria test, which we don't think they have, then we at least at a minimum suggest that 12 cents should be the cap on the wholesale rate.
4066 THE CHAIRPERSON: And in your comments today, you're saying no applicant has provided sufficient evidence of the likely impact to their proposed wholesale rate on consumers, and of its widespread acceptability to Canadians. A number of those parties have submitted survey research. On what -- what are you basing your statement on?
4067 MR. SHAIKH: Well, I think Bell produced a survey that said there is general welcome-ness [sic] to programming that meets certain demands for linguistic and cultural communities. I don't think their survey was specifically targeted to a acceptance of a rate.
4068 Rogers previously provided evidence of acceptance of 12 to 15 cents. Their own evidence now, provided in this proceeding, Rogers' own evidence now says at 21 cents their eventual proposed rate, 50 percent of Canadians would be willing to pay. That of course also means that half of Canadians would be unwilling to pay Rogers' proposed rate.
4069 And I think in terms of being the test for financial impact and widespread acceptability, the fact that with Rogers' own evidence, evidence that it commissioned in a survey that it had control over, demonstrated that roughly half of Canadians opposed their proposed rate, our position is that's evidence of widespread non‑acceptability of their proposed rate.
4070 THE CHAIRPERSON: I hear you. I mean -- and you also said that putting the consumer at the centre of these deliberations means that the Commission must reject any application that -- well -- and you went on to raise a number of points.
4071 I guess I'm just trying to challenge you a little bit to say so you don't accept their surveys or their position, but I'm trying to understand on what you are basing your view that consumers do not want it?
4072 MR. SHAIKH: Well, we haven't commissioned survey evidence, but TELUS spoke earlier today a little abut the viewership data they have. We have our own viewership data, and that demonstrates that third-language Canadians, ethnic communities are not relying on OMNI Regional for broadcasting. It's one of our lowest ranked services. So to suggest to this service as it is already in the market is in demand and valued by Canadians, that's simply not the case.
4073 I think it's also telling that we have -- and I think I have to keep coming back to this. There are 200 services that are licensed. There is the Community Channel, there is Shaw Multicultural Channel, there is English and French language news services that because of the Commission's other policies should be reflecting various linguistic and ethnic communities. It's absolutely essential that this system as a whole provides diversity.
4074 And I'd add also, because I heard some conversation yesterday about the competitive impact of licencing the service, and I don't think that should be underestimated. If you give now a guaranteed 100 percent penetration and a guaranteed rate to one service, that's going to have competitive impacts across the system. The other services that are available in the market will now have a very real threat and a very real competitive threat for advertising, viewers, programming supply, carriage, and arguably, a disincentive to provide local news.
4075 So that's why we think actually tasking one service, which can't possibly meet the needs of this highly fragmented population would actually undermine diversity.
4076 THE CHAIRPERSON: On your latter point about a competitive impact, do you have a view as to whether or not conditions of licence, either limiting or prohibiting local advertising, would address that concern?
4077 MR. SHAIKH: Well, I mean, it's, I think, a question for the Commission because this is based on the theoretical premise that a service will be licensed and what objectives you intend with that license. So if your goal is to make sure that this one service does local news in certain communities, obviously you'd want to impose COLs. If you're concerned as we are about competitive impact, you'd actually want to COLs limiting the amount of local news they do. I think it's an example of the unintended consequences of regulation.
4078 THE CHAIRPERSON: So you and TELUS have raised the issue of the -- I hesitate to use the word -- but I’ll say adequacy of the availability of existing multicultural, multiethnic content in the marketplace. And you say you know what your numbers are?
4079 Have you done any analysis or survey -- surveys internally to look at how much of that content actually generates Canadian-developed news for Canadian audiences?
4080 MR. SHAIKH: We have not commissioned an outside analysis or undertaken that kind of internal analysis to my knowledge.
4081 THE CHAIRPERSON: Okay. So your statement about the availability the content I guess is somewhat qualified because you don’t know whether it really fulfills the objective of news and current events that’s reflective of the various localized ethnic and multicultural communities?
4082 MR. SHAIKH: It’s based on our knowledge of the fact that local news is provided by a number of ethnic services as was mentioned earlier today. Shaw Multicultural channel does actually have some local news in Tagalog and in Cantonese, and English-language and French broadcasters also provide local news.
4083 Our evidence, and I think most of research, to the extent that it is available -- we haven’t commissioned it -- suggests that actually new Canadians and third-language Canadians rely primarily on English-language or French-language news or actually unfortunately online sources for news and information programming.
4084 THE CHAIRPERSON: Thank you.
4085 Recognizing that your recommendation is that the Commission shouldn’t licence any of these services, what are your views about the balancing of broadcast experience on the one hand versus your earlier comments about vertically integrated or large in scale and scope providers? Who would be best positioned to provide a service if licenced?
4086 MR. SHAIKH: I thought you might ask this question which is, I think, a question of if we had to choose, which of these licensees would we choose, and we would like to choose not to answer that question. So we don’t -- we’re not picking from among ---
4087 THE CHAIRPERSON: Well, that wasn’t exactly my question.
4088 MR. SHAIKH: Sure.
4089 THE CHAIRPERSON: Not which, but clearly you’ve raised concern about licensing, I guess in particular Bell and Rogers, because they’re large and vertically integrated, 1.39.06 exc/accepting your comments about vertical integration not being your key concern.
4090 so I guess I’m asking you how would you weigh that versus the -- or what emphasis do you think the Commission should put though on established ability to operate a service?
4091 MR. SHAIKH: Let me try to answer the question this way.
4092 I think it’s important for your consideration whether or not you have faith in the applicant if you choose to actually award a licence, that they can deliver the service as promised, and I think experience can be one of the factors that you consider when making that determination.
4093 I think in the case of Rogers specifically, I don’t think they’re entitled or -- to win the service based simply on incumbency. I think it would be unfair to kind of give them the advantage they’ve actually done this before, they’ve been awarded the licence, and that gives them the experience to maintain the licence.
4094 THE CHAIRPERSON: And in the case of Rogers, would the potential removal of the OTA service from the marketplace have significance?
4095 MR. SHAIKH: Quite candidly, I think the correct and courageous decision you should make in this proceeding is to terminate Rogers’ mandatory distribution order. I think you should rely on the 200 services that have been -- that can provide diversity and I think you should actually challenge Rogers to demonstrate its commitment, if it has a commitment, to multilingual and multiethnic programming by continuing to operate OMNI.
4096 That would be our position.
4097 THE CHAIRPERSON: So with both Bell and Rogers, you’re suggesting that they’re taking advantage or propose to take advantage of 9(1)(h) status to -- I think your words were establish a for-profit business, can you elaborate on that? Why do you call it that? They obviously are prepared to put on the table a variety of commitments and meet them. Why do you characterize it in that manner?
4098 MR. SHAIKH: Well, there are a couple of differences. I’m sure Rogers will, when it has a chance to reply, will correct the record to say that they’re actually proposing what I think’s a break-even model. So, to their credit, they’re actually suggesting that they’ll break even, I think. I think that’s their proposal.
4099 Rogers when they were here, if I remember correctly, they were suggesting they needed some guaranteed return on their investment and some guaranteed PBIT margin. I don’t think that’s appropriate for Rogers to suggest.
4100 I actually agree with one of the applicants who suggested the best model, if there were to be one -- again, we oppose this -- but if there were to be one it should be on a non-profit basis. It’s ironic unfortunately that the applicant making that proposal’s asking for the highest rate, but a not-for-profit model is appropriate for this type of service like it is for APTN, like it is for CPAC, like it is for ME. This is a public-interest service that should be offered on a not-for-profit basis.
4101 THE CHAIRPERSON: Okay. Turning to the issue of technical capability if -- you’ve probably answered the questions that I have about technical feasibility of the two applicants, Voices and Multicultural Described Video Guide, but I’m wondering if you can elaborate a little bit.
4102 When you say not supported by your third-party head-end processing and encryption technology, are you referring to -- is this all of your systems, some of your systems, satellite, terrestrial, which -- where’s the problem?
4103 MR. SHAIKH: So our third-party manufacturer for the large majority of our set-top boxes and infrastructure for those both cable and satellite has told us that it can’t do this. So it’s the vast majority of our systems.
4104 BlueSky is a bit different but it’s not yet highly penetrated, so we’re still talking about the vast majority of our system, and that includes certain infrastructures on all set-top boxes.
4105 THE CHAIRPERSON: And would you be able to give us, I assume in confidence and through an Undertaking, an indication of what kind of costs would be involved to accommodate either I guess both of those models?
4106 MR. SHAIKH: So it’s not a cost question, it’s simply a question of it’s technically impossible, so -- and we wanted to in fairness to the applicants because ---
4107 THE CHAIRPERSON: My parents always told me nothing was impossible.
4108 MR. SHAIKH: Well, it’s -- let me elaborate.
4109 We wanted to really work hard on this in fairness to the applicants because we knew how critical this was to their proposal. So we did testing and we completed that testing in October.
4110 The notion is essentially that you can virtually channel map a single video stream, and then only use the bandwidth required for that video stream once and then on additional virtual channels only add the additional bandwidth for an audio stream.
4111 So we tested this and we actually tested it with eight signals. We tried to multiplex and only one signal, the original signal, was passed through with video. The other seven signals received an error notification and customers would have looked at a blank screen. And, in fact, our third party -- I’m reluctant, as you can tell, to mention the third party, but our manufacturer told us -- actually, our user guide says you can’t do this, you can’t use something called shared component program IDs to do virtual channel mapping.
4112 So the next step we took is recognize that nothing is impossible if we were to provision either of these services, how would we. And in the case of ECG, the only way to provision a service would be if they offered 25 language streams we would have to have 25 separate SD signals if it’s offered in SD.
4113 Theoretically, we could marry this SAP function with additional signals and maybe put eight SD channels with three SAP functions or three languages. That’s, again, theoretical because we don’t know how this service is going to be delivered to us by ECG in theory, so we don’t know that it’s actually provisionable and we weren’t able to test it in terms of the way it was delivered to us.
4114 We do know that would be an incredibly cumbersome and unwelcome customer experience and it would still take at minimum eight channels and that’s capacity that’s simply not available.
4115 We also wanted in the case of multicultural described video guide, to actually answer the question because we know it’s very important to the applicant, how would this service be delivered and can it be delivered. And we understood from this appearance that this is really an audio-only service. In the original application, it talked about embedding in a video signal and still having video content.
4116 If this is a video signal, it actually doesn’t need to be complicated. It should not be a demuxed service, you shouldn’t send us signals in a single video channel. Like other radio stations, we should just receive individual audio signals so we could receive 20 or so audio signals, dedicate channel space to those, just audio with no video, and not have any technical barriers to offering that service. It would still take capacity, about two SD channels, but we wouldn’t demux the service. We would just need to receive individual audio channels.
4117 THE CHAIRPERSON: Okay. Perhaps as an undertaking you might be willing to provide us -- you said your third-party manufacturer said it can’t be done. Could you provide us with something ---
4118 MR. SHAIKH: I will be happy ---
4119 THE CHAIRPERSON: --- in writing to that effect?
4120 MR. SHAIKH: We have a technical report that was provided to the regulatory department that was prepared by our engineers. We would be happy to provide that technical report, which includes excerpts of the user guide that says essentially this can’t be done.
4121 THE CHAIRPERSON: That and, if possible, along with the sourcing of the statement that the manufacturer has said it’s not possible. If that’s not part of the technical report by your internal staff, could you provide that as well?
4122 MR. SHAIKH: Yeah. The report actually includes a cut and paste from the user guide that says you can’t do this.
4123 THE CHAIRPERSON: Okay. Can’t being you shouldn’t -- like policy or technically can’t? Because that’s the distinction.
4124 MR. SHAIKH: No, no, you can’t share a component video. This is important. You can’t share program IDs. You can’t share video components across multiple signals without reproducing that video signal each time.
4125 THE CHAIRPERSON: Okay. Not a policy “can’t”, a ---
4126 MR. SHAIKH: Technically ---
4127 THE CHAIRPERSON: --- it doesn’t work.
4128 MR. SHAIKH: That’s right.
4129 THE CHAIRPERSON: If you could provide that, thank you.
4130 UNDERTAKING / ENGAGEMENT
4131 THE CHAIRPERSON: And then just a quick question on the new -- on that -- sorry, going back, that doesn’t matter whether it’s a satellite platform or ---
4132 MR. SHAIKH: Same manufacturer.
4133 THE CHAIRPERSON: It’s the same issues.
4134 And with respect to the new BlueSky box, can it decode one video and multiple audio feeds?
4135 MR. SHAIKH: So we’re very early in our relationship with Comcast. We do know that they can do more in terms of the sat function. We think it’s possible to have multiple audio signals. I know that ECG spoke at length about the full IP environment. Our BlueSky right now is not yet full IP. It’s still IP and QAM together. Moving to a full IP environment, there will be more options. There will be more options in terms of capacity. We’re not there yet.
4136 And actually, in terms of the language function, I think once that functionality is available, if you could, as that platform suggests, do 14 SAP signals. I mean, that’s something that should be applied across the system eventually, ideally. It shouldn’t be a notion that one station has access to the SAP function. I think you would want, I think as ECG even said, TSN in multiple languages, CBC in multiple languages. We’re many years away from that yet, though, so we shouldn’t award this based on the prospect of a theoretical possibility of this being available in a full IP environment.
4137 I would also say that we’re still, in that respect, only addressing the language fragmentation issue. If you’re using the SAP function, you would just be getting the same video signal in a different language. So you’re not addressing the cultural fragmentation issue. You might actually be, with this approach, as I understand it, potentially watching a programming that’s intended for Pakistani Canadians originally broadcast in Urdu, and then you’d be looking at a SAP function to maybe listen to it in Cantonese.
4138 I don’t think the marrying of the two actually answers the objective. I think you want to address both cultural and linguistic diversity, not just adding language signals.
4139 THE CHAIRPERSON: Understood. I was focused for the moment on the technical issue, though.
4140 Did your technical report address the new box, the technical issues associated with the new platform or solely on the existing?
4141 MR. SHAIKH: There’s a brief mention of BlueSky. The focus was on our existing QAM infrastructure because that’s the vast majority of our set-top boxes and, I mean, this is a 9(1)(h) service that would require 100 percent penetration. If even in our own systems it could be limited to 20 percent penetration -- that’s not the number, by the way -- but a small number of boxes, then it shouldn’t be awarded.
4142 THE CHAIRPERSON: Thank you.
4143 Let me just look at my notes for one second. No, those are all my questions. Colleagues, any questions?
4144 COMMISSIONER LAIZNER: So is it your position that if the Commission were not to license a 9(1)(h) service, that ethnic communities within Canada would have ample local reflections of news and stories that are important to them because of the existing amount of stations that are out there that serve different ethnic communities?
4145 MR. SHAIKH: Our position is that the Commission should continue to rely on those other services and to potentially improve the extent to which they provide local reflection and local news. Our position is that licensing a 9(1)(h) service would actually undermine that objective.
4146 COMMISSIONER LAIZNER: And I think I heard you indicate to the Chairman that you hadn’t done any kind of formal analysis or survey of what is out there in terms of local news and reflection. It’s just your view that this can be accomplished in a different way, and to the extent that there are gaps, they shouldn’t be addressed through a 9(1)(h) order. Is that right?
4147 MR. SHAIKH: That’s correct. This should be accomplished in a different way.
4148 COMMISSIONER LAIZNER: Okay. Thank you.
4149 THE CHAIRPERSON: Commission counsel?
4150 MS. DIONNE: Hi. Can you undertake to file your viewership data for all your third-language services in OMNI Regional?
4151 MR. SHAIKH: To the extent we have it, we will accept an undertaking.
4152 MS. DIONNE: Okay. Thank you.
4153 UNDERTAKING / ENGAGEMENT
4154 THE CHAIRPERSON: Then I thank you very much.
4155 MR. SHAIKH: Thank you.
4156 THE CHAIRPERSON: Thank you for your contribution.
4157 Madame la secrétaire.
4158 THE SECRETARY: Thank you, Mr. Chairman.
4159 I will now invite Forum for Research and Policy in Communications to take its place, please.
4160 (SHORT PAUSE/COURTE PAUSE)
4161 THE SECRETARY: Just as a reminder, the test will take place in two minutes, so please make sure you turn off your cells.
4162 Go ahead please. You have 10 minutes.
PRESENTATION / PRÉSENTATION
4163 MS. AUER: Good afternoon. My name is Monica Auer, and I am the Executive Director of the Forum for Research and Policy in Communications (FRPC),a non-profit and nonpartisan organization that undertakes research and policy analysis broadcasting and telecommunications.
4164 With me today is Dr. Mark Bourrie, the Forum's outside counsel in this proceeding.
4165 Thank you for the opportunity to appear before you today.
4166 The Forum supports a strong Canadian broadcasting system that serves the public interest and meets Parliament's objectives for a diverse, multicultural society.
4167 Apart from serving the section 3(1)(d) requirement of the Broadcasting Act to ensure that Canada's broadcasting system reflects its multicultural nature, the availability of ethnic broadcasting enables Canada to meet international and Canadian law. Section 3(1)(h) of the 1988 Multiculturalism Act, for example, makes it government policy to "promote the reflection and the evolving expressions" of Canadian society's diverse cultures.
4168 At its best, ethnic broadcasting should help new arrivals to learn about Canadian political and social values. It should expose new Canadians to content produced by Canadians for Canadians, and to the cultural values this content transmits. It should reflect Canada's ethnic communities to themselves, to each other, and to the rest of Canada.
4169 Given ethnic broadcasting's importance, the Forum is concerned that this proceeding is taking place before the 20-year old Ethnic Broadcasting Policy is reviewed. That Policy is based on the CRTC's first 1985 ethnic Policy, which said that it was essential to Canadian society to develop broadcasting services reflecting Canada's cultural plurality.
4170 Thirty-three (33) years after the CRTC's first ethnic policy, ethnic broadcasting remains a very small part of conventional television in Canada. People who have chosen to immigrate to Canada and to make it their home lack access to the same level or quality of programming available to Anglophones and Francophones in the conventional system.
4171 By 2036, however, immigrants and their children, will make up the majority of people in Vancouver and Toronto, with sizeable minorities in Montreal and Ottawa.
4172 Changing demography is a key reason that Canada needs a policy for ethnic communications content for the 21st Century. Another is the impact of Canadian audiences' online access to ethnic broadcasters from around the world, which do not share or promote Canadian values.
4173 A public hearing to update the ethnic Policy will enable the CRTC to consult with ethnic community members in far more detail than is usual in a licensing hearing far more detail than is usual in a licensing hearing to understand their concerns, their needs and their wants. This is why the Forum is recommending that the CRTC review its ethnic policy at least two years before any licence issued in this proceeding expires.
4174 Insofar as this proceeding is concerned, the hearing panel’s questions, so far, have in part emphasized applicants’ commitments. These commitments bring the concept of credibility into play.
4176 DR. BOURRIE: The Forum’s written intervention concluded ---
4177 THE CHAIRPERSON: Can we ask that you use your ---
4178 THE SECRETARY: Sorry, your mic is not on.
4179 DR. BOURRIE: Sorry. The Forum’s written intervention concluded with a recommendation that the CRTC either license Ethnic Channels Group or Bell and oppose the licensing of Rogers.
4180 Briefly, Rogers’ application continues to lack credibility. It testified on Monday that the core of OMNI’s brand is its news and local programming and that its first priority is to cover the news for the local language community.
4181 These statements are puzzling. It was Rogers, after all, that cancelled newscasts on its OMNI stations in May 2013. It’s Rogers that, in December 2013, said it could not afford $2 million to reinstate the local programming that it had cancelled. It was Rogers that, in May 2015, cancelled all third-language news on the OMNI stations five months before a federal election.
4182 Rogers testified on Monday -- pardon me -- that it does not take the responsibility for mandatory carriage lightly, implied that it takes its regulatory responsibilities seriously.
4183 Again, this is somewhat puzzling. While the 1999 Ethnic Broadcasting Policy says that ethnic stations play an important role in serving local communities, Rogers argued in 2015 that cancelling OMNI’s local newscast did not breach any Commission policy, implying that it felt free to ignore the intent and spirit of the CRTC’s policies.
4184 It is true that if the CRTC grants Rogers’ licence application, it could impose conditions on the licence to try to ensure that Rogers meets the commitments it now seems to be making. It is, therefore, worth remembering that in 2017, Rogers argued that a condition of licence stating that the licensee shall produce and broadcast daily newscasts did not mean that the licensee should produce daily newscasts. Rogers said this actually meant that third parties, not the licensee, could produce these daily newscasts.
4185 Just what licensing language would be clear enough to prevent Rogers from reducing or cutting back on one, some or all of these many promises it is making in this proceeding?
4186 As for Bell, the Forum’s written interventions noted its application’s strength, but raised concerns about its reliance on English-and-French-language content and the fact that granting its application would solidify BCE’s dominance in Canadian news and the broadcasting system.
4187 Bell’s submissions yesterday have not addressed these concerns. Bell said that its application provides the best opportunity for stability and reliability; yet Bell said much the same thing in 2000 when it bought CTV and since then it has closed TV stations and threatened repeatedly to close others.
4188 The CRTC’s statistical and financial summaries also show that Bell has reduced CTV Newsnet’s Canadian programming expenditure by 40 percent over the past five years. They reduced its staff from 82 in 2014 to 68 in 2017. Over this period of CPE and staff cuts, Newsnet’s PBIT margin nearly doubled from 32.2 percent in 2014 to just over 60 percent in 2017.
4189 Bell is stable and reliable in delivering shareholder value, but will a licence for Bell simply transform Canada’s ethnic communities into another cash stream for one of Canada’s largest communications companies?
4191 MS. AUER: To conclude, this hearing panel bears a heavy duty.
4192 THE CHAIRPERSON: Can I ask that you use your microphone, please?
4193 MS. AUER: I should know better. This hearing panel bears a very heavy duty. It must decide if any of the eight applicants in this proceeding ought to be granted the still-rare privilege of a new ethnic television licence for distribution to all broadcast and distribution subscribers to remedy the inadequate ethnic television service they have received over the air for some time.
4194 If that answer is yes -- and we think it should be yes -- your burden is to decide whether ethnic communities will finally enjoy new, local content and original news from a new voice in a wide range of languages. If so, the Forum asks that the CRTC state in its decision the importance of local and national in-house, original news to all broadcast audiences, attach clear and detailed conditions of licence to any service licensed to mandate the broadcast of daily hours of original -- local and original national news produced in house by the licensee and its employees, attach expenditure, employment and news-gathering commitments by condition of licence and require the licensee to create, produce and broadcast its own in-house, quality current affairs programming.
4195 The Forum also, again, respectfully urges the Commission to update the 1999 Ethnic Broadcasting Policy through a well-publicized proceeding that includes at least one hearing and preferably also hearings in Vancouver, Edmonton, Montreal, Ottawa and Toronto where so many people in Canada’s ethnic communities live and work. This proceeding should take place at least two years before the licence of any new service emerging from this proceeding is renewed.
4196 Canada’s ethnic communities deserve high-quality TV programming. None of the applications in this proceeding is absolutely perfect, but perfection need not be the goal of licensing and it has not been in the past. With appropriate conditions and the same chance to grow, which other broadcasters have enjoyed, at least one of the applications could meet the needs of Canadian ethnic communities in the short term.
4197 Thank you for your time and we’d be pleased to answer any questions you may have.
4198 THE CHAIRPERSON: Thank you. Thank you for your submission.
4199 Madam Laizner?
4200 COMMISSIONER LAIZNER: Thank you and good afternoon.
4201 So I think we take your comments about the importance of renewing ethnic policies on a regular basis and that, in your view, it’s been a long time coming. But I am interested, right now, in understanding where you see, based on your research, the gaps in the delivery of ethnic programming that is occurring in Canada. Are you in a position to talk about that?
4202 MS. AUER: Mark may have some additional comments, but I would like to say that, in our view, one of the key issues facing Canadian ethnic communities is a dirth -- a lack of original local news from local communities in Canada and, again, here we are just a little less than a year before the next federal election.
4203 So a second area, apart from news, however, would be drama and by drama, I mean the Category 7 programming that other conventional television services also deliver and the fact that although we do have “Mohawk Girls,” which is a nice combination of many aspects of Canadian society, does not seem to me that we have many original Canadian-produced ethnic dramas available every year from ethnic services in Canada.
4204 DR. BOURRIE: I’d like to add something to that.
4205 COMMISSIONER LAIZNER: Sure.
4206 DR. BOURRIE: I was in journalism for quite a while before I became a lawyer. One of things that I’m finding distressing is what I see as a lack of pitch for really good quality journalism in any of these applications.
4207 The entity that’s licensed will not just be competing with Canadian broadcasters; it will be competing with everybody putting everything on the internet. So if we have basically lame journalism -- soft, soft journalism that is done by students, stringers, freelancers in communities up against the high-quality material put out by state media from some of the countries that broadcast over the internet, I don’t think we’re going to see much competition for sort of Canadian values in that and as we come into an election year, I think we’re going to see more and more online media issues come up. So I think when you look at licensing one of these licensed applicants, take a look at the quality that they’re offering and make sure that it’s just not being people just speaking into a void, that this is good enough to attract Canadian ethnic viewers.
4208 MS. AUER: And that it provides a competitive choice for Canadian audiences, both ethnic communities and non-ethnic communities.
4209 COMMISSIONER LAIZNER: And what’s your view on the role of independent producers in terms of ethnic programming because I note from your comments today that you’re wanting to see a lot of conditions of licence that relate to, you know, a requirement to do things in house, whether it be news or current affairs, so I -- I’d just like to understand a bit where you see the independent producer in this system?
4210 MS. AUER: Well, I think, first of all, I’d like to preface my comment by saying that the reason that the phrase “condition of licence” appears so frequently in our written intervention and our remarks today is because I think the Commission has had exceptional difficulty in ensuring that the promises made in the past with respect to over-the-air ethnic television services have simply not been met, and the absence of very clear and detailed conditions of licence has allowed programming changes that have not benefited the community. So that would be our main reason, in this particular licensing proceeding, for urging you to please, please, please place very clear expectations on the licensee through enforceable conditions of licence.
4211 There was a time when I thought that if you referred to the idea of terms and conditions of a licence, you might in fact be referring to the language within the licensing decision itself.
4212 I no longer believe that. I think that what licensees have made clear, what the Commission has made clear is that all that matters in the end is the condition of licence.
4213 As all of you know, in the past, in the early ‘70s, the Commission looked at many… at hundreds of radio station applications, asked them to complete the promise of performance and simply made every promise of performance a condition of the licence, and that minimized a lot of the Commission’s work. All the licensee had to do was state what would be happening on the schedule through the promise of performance, and that was the enforceable condition of licence.
4214 In television, it’s been a different experience, and certainly the decisions we mentioned in our remarks today indicate that there have been some very serious challenges with respect to enforcement. So that deals with the condition of licence aspect.
4215 As for independent production, I think Canada has an exceptionally talented independent production sector. Whether independent producers should be doing the entirety of a broadcast schedule is a question that the Commission obviously will have to answer itself.
4216 I think in our view, we look at the licensee as the entity -- the entity -- that is responsible for the content that they originate, and while one may not have many concerns about, let’s say, drama or a documentary perhaps, or music and variety, news is the cornerstone of Canadian democracy. We hear that continually from the Supreme Court and, as a result, it’s our view that the licensee must bear full and complete responsibility for the news that it chooses to disseminate. Perhaps it may gather a few stories here and a few stories there from independent producers, but as I recall, the Broadcasting Act calls for a significant contribution from the independent production community. It really places a lot of the -- most of the emphasis for responsibility on the licensee, and I think that means news.
4217 COMMISSIONER LAIZNER: And so is that your view for current affairs programming as well, that it ought to be conducted by the licensee in-house and not with the use of independent producers?
4218 MS. AUER: Well, that’s a really interesting question because of the Let’s Talk TV decision in which news was redefined to include Category 1 and Category 2A of the television programming categories.
4219 So if, as we’re saying, news should be produced in its entirety in-house by the licensee, that would preclude a certain amount of analysis being done by the independent production sector. However, that also does leave Category 2B that they could certainly do a lot of work in.
4220 COMMISSIONER LAIZNER: And on the news front, your concern is that we should put the emphasis on proven experienced journalists as opposed to people within the community that may not have those credentials? They may not have achieved those credentials yet?
4221 MS. AUER: I think Mark has a great deal to say because, after all, he wrote about journalism under the Harper government.
4222 There was a time when none of us had any experience whatsoever. We all start from somewhere. This is not to say that it’s a good idea to hand out a licence worth millions and millions of dollars in subscription revenues to people who have never, ever, ever done the job before, but then the question is: is it possible that they are actually able to do it? Do they have a reasonable business plan?
4223 For journalism, I think our preference would be for something that I would put in quotation marks to emphasize that I don’t think that there is yet a clear-cut definition of professional journalism, and I would hesitate in this hearing to say, “Oh, we can only have ‘professional journalism’.” My concern is that if a service relies in its entirety on stringers and freelancers, that service may not be able to build up the expertise it needs to establish a solid journalistic reputation and a solid foundation of news.
4225 DR. BOURRIE: I think what you need to do is scan the whole environment and say, okay, I am an ethnic television viewer. What are the journalistic options open to me, and take a look at what’s coming across the internet. Take a look at what’s -- you know, that’s streamed from everywhere, and then take a look at what you’re licensing and say, “Am I going to watch something that’s very professionally made as opposed to something that’s maybe a grade or two above some sort of college project? Am I going to rely on people who have little or no training, little or no experience reporting on major social issues? And there are incredibly important issues facing Canada’s ethnic community, and they’re not just political. They’re social. They’re economic. And you having somebody who’s got a three-year or two-year college certificate in journalism from a community college or university in Canada, coming out of school and not having the experience or depth to understand these issues is probably not a good thing.
4226 So like I say, look at what is out there now and license something that can compete against it. Don’t license something just for the sake of checking a box, oh yes, we have an ethnic service. Nobody watches it; it’s not very good, but we have it, so another box is done.
4227 COMMISSIONER LAIZNER: Some of the parties that have come before us have looked into viewership of ethnic stations. Have you done any work in that regard in terms of what kind of viewership amongst ethnic communities is out there for the stations that exist right now?
4228 MS. AUER: No, we have not done audience analysis. The Commission, of course, has its own data on ---
4229 COMMISSIONER LAIZNER: Right.
4230 MS. AUER: --- in that area.
4231 What we have done is to look at the programming that’s actually being broadcast using the CRTC’s programming logs.
4232 One point, though, that struck me as I was listening to some of the discussion earlier was the notion that because viewership may not necessarily be high for ethnic services now, therefore, we shouldn’t do it at all and we should simply let -- not so much let, but ethnic audiences should be able then to rely on discretionary and foreign ethnic services.
4233 And again, I don’t think that’s what Parliament intended by section 3. I don’t think that’s what Parliament intended through the Multiculturalism Act. I think Parliament very clearly intended that ethnic audiences in Canada should have access to high quality programming.
4234 And so the fact that people may not be watching it now is, to me, evidence of a real need for better programming.
4235 COMMISSIONER LAIZNER: Okay.
4236 DR. BOURRIE: Sorry.
4237 COMMISSIONER LAIZNER: Go ahead. Go ahead.
4238 DR. BOURRIE: I think we should also keep in mind that even -- that we’re looking at a very shifting landscape, and that’s something that we put in our intervention, is that from 1985 ‘til now, it hasn’t been just changes to the broadcasting environment. There’s also been incredible changes to the demography of this country.
4239 So by the time this licence expires, we’ll be looking at about 2 million more new Canadians arriving in this country.
4240 So we’re not just licensing something for the world as it exists right now, but by the time you get around to this again, an even different environment will be there and it’s something that needs to be anticipated.
4241 COMMISSIONER LAIZNER: You’ve indicated in the intervention that you filed that you supported the application by the Ethnic Channels Group and you identified certain strengths and weaknesses.
4242 We note that they’re ramping up to the number of languages they serve kind of would be undertaken over a number of years, whereas there are other applicants that were committing to serving 20 languages right from the get-go of the launch of their service.
4243 So do you have any concerns about whether their application would meet the criteria that we have for an exceptional contribution if they’re starting at 10 languages and only ramping up more slowly than that?
4244 MS. AUER: No.
4245 COMMISSIONER LAIZNER: Okay. That's fine. I was just ---
4246 MS. AUER: I could go on at length, but no, we have no concerns because every broadcaster in Canada has started out not necessarily meeting their promises, or their hopes, or their dreams, or their expectations, but they are starting. And our view is that if the Commission were to grant somebody the remarkable privilege of this very -- of this particular licence, I think if the Commission then -- series of ifs, and I'm sorry, but a series of ifs ---
4247 COMMISSIONER LAIZNER: Right. No, no worries.
4248 MS. AUER: --- in conditions of licence, and if it enforces them, and if it maintains...
4249 And really our position here today in 2018 is that by 2028 we may all be in a completely different room doing completely different things. But for today, to ensure that Canada's ethnic communities have the service to which they're entitled, please license the best available service.
4250 COMMISSIONER LAIZNER: And we've heard from some others that there may be some serious technical issues with their service. So what would be your Plan B on that front?
4251 MS. AUER: I think the CRTC staff have a tremendous depth of technical experience and they can address that issue. Because I don't have any technical experience, so I ---
4252 COMMISSIONER LAIZNER: No, that's not my question. My question is if their service really isn't technically feasible, is there another applicant that you would put at the top of your list ---
4253 MS. AUER: Yes.
4254 COMMISSIONER LAIZNER: --- with all the other provisos you have, and who would that be?
4255 MS. AUER: If Ethnic Channels Group's application were found to be completely untenable in terms of technical -- and I'm so tempted to use the word "bafflegab" here because I understand so little of it, but I know that sounds as if I'm dismissing the technical issues, and I'm not. I know they're important.
4256 And ATN, I think did a tremendous job in their presentation. They were passionate. They're committed. Our concern with their application is the general overall absence of original local content. If they could wave a magic wand and suddenly come up with local content, we'd be delighted to say license them, please license them.
4257 COMMISSIONER LAIZNER: You've made clear that you are not supportive of the Rogers application. You've talked a little bit about the history of OMNI with Rogers through your lens. And with respect to Bell, you have indicated that you have concerns about their use of news from CTV. Now, they've indicated at this hearing that they would accept a condition of licence that no more than 10 percent of the news programming would be dubbed CTV content.
4258 So does that change your opinion, relative to their proposal and other proposals at all?
4259 MS. AUER: No.
4260 COMMISSIONER LAIZNER: And can you elaborate a bit on that?
4261 MS. AUER: As we mentioned in our remarks, one of the issues for this licence, any licence, I think, has to be the licensee credibility. And I'm very concerned about a licensee of Bell's scale, Bell's enormous depth of talent, its enormous resources threatening nearly every year that I can remember for the past -- since I think 2007, if I recall correctly -- threatening to close over-the -- its own over-the‑air television stations.
4262 And I'm concerned about giving a licensee that has so cavalierly closed television stations and so clearly believes that every television station must make money on its own, must be -- operate on a standalone financially sound basis, I'm concerned that that would be a licensee that would not necessarily -- where the passion and commitment to ethnic broadcasting would be outweighed by the bottom line.
4263 DR. BOURRIE: I also think that we -- it would be nice to see some new blood in broadcasting in this country. And also, we looked at the governance, and looked at the -- you know, people who came forward to put forward their applications, and the -- we would like to see somebody licensed who is in this line of work because they want to be in this line of work. That that's their sort of calling in life.
4264 COMMISSIONER LAIZNER: But I'm -- we're also dealing with the context that you've raised about having experienced journalists, and Bell has committed to putting a lot of local journalists in the field and increasing their third-language programming to 70 percent.
4265 So you know, I take those comments, together with what you've been talking about in terms of your views on the need for experienced journalists, so that's part of the backdrop of this question.
4266 MS. AUER: And I think Bill has -- I keep saying it. Because I'm -- we're not -- the Forum is not here to denigrate any particular applicant or broadcaster. Bell has a very strong news department, of course.
4267 The issue is one of competition for news. Do we not want to have a separate source of news in Canada? If we simply give Bell another over-the‑air television service and we consolidate newsgathering in Canada, rather than diversifying it. The Commission has a Diversity of Voices Policy, well that policy doesn't say you could have consolidated ownership. The issue here really is that we need to have new sources of information and analysis in Canada.
4268 And our secondary concern is CTV has already been reducing its news services. CTV Newsnet staff has gone down, its expenditures have gone down.
4269 I would prefer to see a licensee who is committed to news, wants to hire journalists and wants to keep them on staff. I would like to see that number grow over time.
4270 DR. BOURRIE: And you know, the difference between hiring people who aren't experienced and hiring people who are experienced is spending a little more money. There's nothing that precludes companies that aren't Rogers and Bell from paying the difference between getting a kid out of school and getting somebody who's got 5 years experience in the business, or has got, you know, beat experience to understand the issues that they're covering.
4271 COMMISSIONER LAIZNER: And just flipping back to Rogers for a moment. I mean, in your view, they've broken the trust of Canadians. But they have received a significant amount of support in this process. So how do you account for that level of support from Canadians for Rogers? I mean ---
4272 MS. AUER: Well, the Forum can't speak for the many Canadians who intervened on behalf of Rogers. What we can say is that we think Rogers has an issue with credibility.
4273 We can say that people may not recall the many cuts they've made over the last 5 years, but we do. And we remember the hundreds of staff that it let go. So I think many people are concerned that if Rogers goes there won't be anything else, and that's -- I can understand that concern.
4274 COMMISSIONER LAIZNER: So is your concern with Rogers, for example, not with respect to the quality of their programming but more so that you're concerned that they'll try and chisel away at the amount of programming over the licence term?
4275 MS. AUER: I don't have any concerns about the quality of Rogers' staff. I think they're highly committed to the work they do. I have concerns that -- the Forum has concerns that Rogers has over the years, over the past few years, in particular, has shown that it will not put resources into OMNI, and it will -- at any time when it believes that its bottom line is threatened, it will cut programming on Rogers. That does not serve ethnic communities' interests.
4276 COMMISSIONER LAIZNER: All right. I just want to talk about the CanadaWorld TV application a little bit with you as well. I see from your written intervention that you were quite interested in the video on demand channel, that you thought that that was a strength, but at the same time, one of the weaknesses of the application, I think you referred to companion-Netflix-style-on-demand-programming, which I gather would be part of a VOD offering.
4277 So I -- I'm just trying to get a clarification on, you know, what your view is on that option of the VOD service?
4278 MS. AUER: I think the VOD option is a technical innovation. I don't know if it is sufficient to tip the balance in favour of the applicant. I bet -- I suspect Mark may have some additional comments.
4279 DR. BOURRIE: Having listened to the people from Shaw and the technical aspects of it, there seems to be a problem there, but I think I’ll just leave it with that.
4280 COMMISSIONER LAIZNER: Okay. The other part of their application -- and I think your comments were that you were concerned that there would be a bias towards South Asian, Italian and Spanish programming. I think we’ve heard from them that they would serve many more communities.
4281 So have you given that some thought?
4282 DR. BOURRIE: I ---
4283 MS. AUER: Tremendous. If they’re going to pay more attention to those other communities, excellent.
4284 COMMISSIONER LAIZNER: Okay.
4285 MS. AUER: That would be a good thing.
4286 COMMISSIONER LAIZNER: I think those are all my questions.
4287 THE CHAIRPERSON: Madame Simard.
4288 COMMISSIONER SIMARD: Merci.
4289 Thank you for your presentation and thank you for your answers. I just have one quick question.
4290 You said that there’s a need for better programming. I’m just curious to know, in your view, what is the importance to review the format itself?
4291 MS. AUER: I’m sorry, review the format?
4292 COMMISSIONER SIMARD: The format, like the -- we have heard many comments saying that the grids made things a bit hard, like for the viewers, if they want to watch their news in their language, they have to do it like at 7:00 p.m. So it’s kind of rigid.
4293 And the technology, we have heard some proposals -- innovative proposals using technology. We just discussed maybe the limits of the technical -- the potential technical limits of it.
4294 But I’m curious to hear more about the -- is it the right word, like the format of it?
4295 MS. AUER: Thinking of the schedule, which is what I’m thinking of in terms of when programming is available, I recall having a similar concern about 10 years ago. I went to a parliamentary hearing and I heard a number of intervenors before the Heritage Committee discuss, you know, the fact that their families would schedule time to watch this kind of programming, because it was an opportunity for the older generations to talk with the younger generations in their own language, to discuss and to engage. And that changed my mind as to the importance to this community or this set of communities about what we used to call appointment television.
4296 But I must admit that in the back of my mind throughout this proceeding, I’ve just been assuming, and I apologize if it’s in error, that an applicant who is approved would also have an online version of the service so that people would be able to access the programming online at any time. Obviously you can’t access news at any time because it hasn’t been produced yet, but the fact is that, you know, it will be.
4297 I must say, you know, for instance, we went to the trouble -- well, it’s a minor trouble -- just to analyze the Rogers schedule, and when I see that all of that black and white stuff is either foreign programming or repeat programming, I’m concerned that there’s very little that’s new there.
4298 And, you know, I’m flummoxed, whenever I watch conventional television, at the number of promotions for new episodes of new content that has never aired before, and yet the ethnic community is expected to have a schedule that’s two-thirds repeat or foreign, and I have a concern about that. I think we’re all entitled to see something new. And again, I think the word “news” has the word “new” in it, and I just think there ought to be more new news.
4299 COMMISSIONER SIMARD: Thank you very much.
4300 THE CHAIRPERSON: Thank you. Thank you for your submissions.
4301 MS. AUER: Thank you for your time.
4302 THE CHAIRPERSON: Madame la secrétaire.
4303 THE SECRETARY: Thank you, Mr. Chairman.
4304 We’re now ready to hear the Community Media Advocacy Centre (CMAC), and they are all appearing by Skype. So they should be appearing on the screen in a second.
4305 Good afternoon. Welcome to this hearing. Can you hear me well?
4306 MS. RAHEMTULLAH: Yes.
4307 DR. ODARTEY-WELLINGTON: Yes, I can hear you very well. Thank you very much.
4308 THE SECRETARY: And the third person on the ---
4309 DR. KING: Yes, I can hear you well.
4310 THE SECRETARY: So I would ask that you please introduce -- each of you introduce yourselves first for the record, and then you can proceed. Just state your name for the record first and then you can proceed.
4311 DR. ODARTEY-WELLINGTON: Felix Odartey-Wellington.
4312 MS. RAHENTULLAH: Omme-Salma Rahentullah.
4313 DR. KING: And my name is Gretchen King.
4314 DR. ODARTEY-WELLINGTON: So I believe we can proceed now?
4315 THE CHAIRPERSON: Yes, please, go ahead. You can proceed.
PRESENTATION / PRÉSENTATION
4316 DR. ODARTEY-WELLINGTON: Thank you very much.
4317 Good afternoon Chairperson Scott, Commissioners Simard and Laizner, Madame Secretary, and CRTC staff. Before we begin today, we would like to thank the Commission for acknowledging that this proceeding is being held on unceded Algonquin territory.
4318 I am Dr. Felix Odartey-Wellington and a policy consultant at the Community Media Advocacy Centre or CMAC. I am speaking with you today from Cape Breton University in Sydney, Nova Scotia. Joining me on Skype are my colleagues Omme-Salma Rahemtullah, a founding member of CMAC’s Board of Directors, and CMAC’s research consultant, Dr. Gretchen King.
4319 We would like to share the regrets of Monique Manatch, President of CMAC’s Board of Directors, who would be seated with you today in Gatineau if this hearing did not overlap with her commitments as a PhD student at Carleton University.
4320 Founded in 2015, CMAC is a non-profit organization that is uniquely comprised of academics, lawyers, policy consultants and experienced community media practitioners. CMAC supports the self-determination of Indigenous, racialized, and disabled peoples in the media through research, relationship-building, advocacy, and learning. In our work, CMAC prioritizes the perspectives, voices and lived experiences of Indigenous Peoples, racialized people, third-language and disability communities because these voices are underrepresented in the media landscape generally.
4321 CMAC is participating in this hearing to respectfully advocate for accountable, not-for-profit, and representative public interest broadcasting. The CRTC is empowered to ensure that any licence that is issued at the end of these proceedings complies with the Broadcasting Notice of Consultation -- correction, the Broadcasting Notice of Consultation and CRTC policies, such as the criteria for assessing applications for mandatory distribution on the digital basic service and the Ethnic Broadcasting Policy. As well, the CRTC must consider the applicable legal frameworks that include the 1991 Broadcasting Act, the Canadian Charter of Rights and Freedoms, and Constitution Acts.
4322 DR. KING: CMAC’s intervention in this hearing also considers the binding international legal frameworks that Canada has ratified, including UNESCO’s Convention on the Protection and Promotion of the Diversity of Cultural Expressions, the United Nations’ Declaration on the Rights of Indigenous Peoples, and the United Nations’ Convention on the Rights of Persons with Disabilities.
4323 CMAC’s methodology in reviewing the public record for this hearing anchors the obligations set out in these documents. With the above framework, CMAC assessed each applicant based on how their proposals will affect protected groups that include Indigenous peoples, ethnic and linguistic minorities, and people living with disabilities.
4324 We will not repeat our methodology, findings, and recommendations here, although we welcome your questions on our intervention. In the time we have remaining, we will highlight the most important factors the CRTC should consider when issuing a mandatory carry licence for a national, multilingual, multi-ethnic television service offering news and information programming.
4325 MS. RAHEMTULLAH: To begin, CMAC believes the Commission has clear legal frameworks to follow when issuing any licence under this proceeding. As outlined in our intervention, relevant policies, laws, and international agreements provide excluded communities communication rights to reflection and access across the Canadian broadcasting system. Under these frameworks, these are protected groups.
4326 In the case of licences issued by the Commission with a 9(1)(h) order, broadcasters are entrusted with the mission of providing access and reflection to these protected groups for the privilege of mandatory carry and the associated fees.
4327 For example, APTN ensures access and reflection to First Nations, Inuit, and Métis communities; TV5 and UNIS give access and reflection to Francophone communities; and AMI and CanalM provide access and reflection to communities living with disabilities. Accordingly, each of these 9(1)h licensees are not‑for‑profits organizations with representative boards of directors that provide public and accountable governance structures.
4328 An unfortunate exception to the not‑for‑profit governance of 9(1)h licences that uphold the broadcasting rights of protected groups has been the licence issued to OMNI/Rogers. Entrusting a for‑profit corporation, and one of Canada's largest media conglomerates, with the mandate to serve the broadcasting needs of ethnic and third-language communities in Canada has failed the Commission's expectations and the public's interests.
4329 The failures of OMNI/Rogers documented by the Commission are the reason why this hearing is being convened today. The goal identified by the Commission's Call is to award mandatory carry to an applicant that can provide a better service.
4330 MS. OMME-SALMA: CMAC believes the CRTC's choice today is limited. Non‑profit broadcasters are already providing a better service. This is evident in license reviews and renewals of APTN, TV5 and UNIS, and AMI and CanalM.
4331 By contrast, the for‑profit practices of broadcasters like OMNI/Rogers have resulted in what Professor Sherry Yu calls the instrumentalization of ethnic media, whereby media meant to serve the needs of ethnic and linguistic minorities are strategically leveraged by corporations like OMNI/Rogers to increase profits.
4332 CMAC's review of the academic scholarship on ethnic media in Canada provides evidence that non‑profit governance can better ensure the privilege of mandatory carry and the responsibility of serving the broadcasting needs of protected groups, achieves the public interest goals of the Broadcasting Act and CRTC policies.
4333 In addition, the CRTC's intent to award a licence with a mandatory carry order and the associated fees set up the need for this hearing to consider obligations for consumer protection as well as transparency and accountability in the management of public funds. CMAC believes that only a not‑for‑profit organization can provide representative, accountable, and transparent governance in the public interest.
4334 MR. ODARTEY-WELLINGTON: In our written intervention, CMAC also proposed a checklist of standards for the Commission's consideration. Our checklist measures how each application achieves or fails to achieve the exceptional conditions outlined in the Criteria. This checklist assesses governance, diversity in programing, and employment practices.
4335 The standards include, (a) non‑profit, representative ownership and governance; (b) ethno-cultural diversity in programming that also equitably reflects Indigenous and disabled peoples in Category 1 news; (c) linguistic diversity in programming that promotes intercultural dialogue by broadcasting a diversity of languages, including Category 1 news in English and French; and (d) equitable employment practices that prioritize ethno-cultural diversity and includes Indigenous and disabled people.
4336 By these standards, the proposed governance, programming, and employment practices by a majority of the applicants do not substantially engage Indigenous and disabled people, despite their communication rights as protected groups. The equitable portrayal and employment of Indigenous and disabled people in the media is not only mandated by the Act, guaranteed as a fundamental freedom by the Charter, and required by international agreements, the notice also set out criteria expecting such commitments from the applicants concerning these protected groups.
4337 We also note recent studies which points to the need to ensure that minority voices are not inadvertently characterized through the application of broadcasting policy or regulation, as well as the need to ensure that spaces are created outside of the governor -- corporate governance sphere for alternative and community media. And here, we reference work published by scholars, such as Carl Cornwyn (ph) in 2017, David Skinnard (ph) in 2015, and Media Action in 2012.
4338 Only TELE1's application includes representative seats on the board of the directors and employment equity for Indigenous people and people living with disabilities. CMAC respectfully recommends the Commission reject any licence that does not require -- correction -- reject any licensee that does not guarantee representation in governance or equity in employment for protected groups.
4339 DR. KING: With regard to diversity in content, four of the applicants propose to broadcast some programming that is reflective of Indigenous peoples. However, TELE1 commits to broadcast 5‑hours per week in Indigenous languages and offers a news priority bureau for Indigenous Nations.
4340 Indigenous content on a multi-ethnic channel can help to fulfill the Calls to Action put forward by the Truth and Reconciliation Commission of Canada that recognizes the importance of First Nations, Inuit, and Métis people engaging with newcomers. Unfortunately, most applicants have ignored the TRC's call to take action on reconciliation, and thereby, have missed the opportunity to broadcast distinct and diverse points of view from newcomers and Indigenous peoples.
4341 CMAC recommends the Commission reject any application that does not provide equitable representation for Indigenous people in news and language programming.
4342 This -- the above exceptional standards determine that TELE1 is the only application by a not‑for‑profit organization. The seven other applications are by for‑profit organizations.
4343 The research summarized in our written intervention and the history of corporate control of ethnic media in Canada requires the Commission to guarantee transparency and accountability for the subscriber fees meant to sustain public interest broadcasting.
4344 CMAC recommends the Commission reject any application not presented by a not‑for‑profit corporation -- not‑for‑profit organization that proposes representative, accountable and transparent governance in the public interests.
4345 MS. OMME-SALMA: Finally, where the Criteria, the policy, and the Act expect applicants to uphold standards that promote intercultural dialogue by broadcasting a diversity of languages, including news in English and French, only TELE1 commits to airing news daily in the two official languages.
4346 The research and data reviewed in CMAC's intervention requires action by the Commission to ensure the new multilingual, multi-ethnic channel also be accessible to a wider audience. According to this standard for intercultural dialogue, CMAC recommends the Commission reject any application that does not provide news in English and French.
4347 Using the above exceptional standards that uphold the Criteria, CMAC assessed each application and compiled the results within Table 1 of our intervention. You can consult this table with Appendix 1 of our oral comments.
4348 Based on this review, CMAC respectfully recommends the CRTC approve the application by Independent Community Television Montréal for broadcasting licences to operate national, multi-ethnic, multicultural discretionary services to be known as TELE1 and TELE2. With ICTV's application, the Commission has the opportunity to ensure ethnic media are not instrumentalized for profits and soiled to third-language. Pardon me -- and siloed to third-languages.
4349 MR. ODARTEY-WELLINGTON: Thank you all very much for listening to our presentation, and we look forward to taking your questions at this time.
4350 THE CHAIRPERSON: Thank you. Vice‑Chair Simard will begin.
4351 COMMISSIONER SIMARD: Thank you, Mr. Chairman.
4352 Thank you for your presentation. Thank you for your intervention. I'll start with a question of clarification.
4353 CMAC is supporting the ICTV application, it is clear in your presentation. We do note there are links between your organization and ICT, including shared members of advisory committees, as well as ICTV's CEO being a consultant at CMAC. So how has CMAC's relationship with ICT affected its view of the application?
4354 DR. KING: So I was the consultant that reviewed the documents to prepare for our intervention, and the consultants you see before you are the ones who prepared -- and in addition to our Board Member Omme preparing our oral intervention.
4355 And so CMAC handles a lot of files and we consult in various capacities across ethnic, Indigenous, and disability media sects in Canada. And, unfortunately, we’re one of the few advocacy organizations servicing the needs of these communities, in terms of research and learning and advocacy, as we stated in our mission.
4356 And so, yes, there are links, but we work organizationally to keep, say, the hands and the assistance that are being provided through various consultants on different files separate within our organization.
4357 COMMISSIONER SIMARD: Thank you.
4358 I have another question of clarification.
4359 So in page 5 of your presentation you suggest an equitable employment, I guess, practices. So equitable employment practices. And a bit later you refer to, in page, I think it’s -- sorry -- 6 and 7 to the Board of Directors and the employment equity kind of policy, I guess.
4360 So I’m just trying to clarify; so are you suggesting that this, I guess, policy would apply just to the Board of Directors or more like for the staff itself? So when staff is hired, there should be, I guess, a concern to hire people that represent various communities.
4361 DR. KING: So our criteria of exceptional standards puts forward four different and distinct categories and, yes, equity plays a role in multiple. So if you allow me, I’ll just clarify those categories.
4362 Governance, and so therefore representation in governance by Indigenous disability communities, but also diverse ethnic communities should be a requirement of the CRTC, even perhaps a condition of licence to be considered, that the licensee be non-profit, be representative of diverse ethno-cultural communities, including Canada’s multiculturalism, which is required by the Act, as well as Canada’s multiethnic communities, also required by the Act. So this would include Indigenous as well as disability communities. That all falls under the category of governance.
4363 There is also the employment equity issue which you raised, which refers to staffing and unfortunately, no of the -- very few of the Applicants, except for Tele 1, have put forward commitments on employment equity. We talk about the representation of Indigenous and disability peoples but you had panellists earlier today speaking about the gender parity that Tele 1’s application is putting forward as well.
4364 We also agree that gender parity is equally as important in equity in employment, as provided by the policy of the CRTC and laws in Canada. But our criteria is (technical difficulties) and disability communities.
4365 COMMISSIONER SIMARD: Excuse me, we missed the last 20 seconds, I would say. I’m sorry we had a -- a technical issue. Could you please repeat?
4366 DR. KING: I would only reiterating that CMAC’s standards for equity in employment refer to Indigenous and disability communities. However, we recognize that law and CRTC policy also recognize the equity issues for women, and that was spoken to earlier today as well. While we agree to that, our table only addresses Indigenous and disability.
4367 COMMISSIONER SIMARD: So in practice you would recommend a condition of licence that would be imposed to the licensee to ensure that, for example, I guess, journalists would -- that are hired to cover news, local news for specific communities would, I guess, meet certain threshold?
4368 DR. KING: So as you heard earlier with regard to women’s representation and equity employment, it’s not just the on-air positions, it’s also the management positions. And as we mentioned earlier, it’s not just about who’s employed, it’s also who makes decisions about employments and who makes policies around equity in the organization, and that points to the governance issues and the need for equitable governance.
4369 COMMISSIONER SIMARD: Thank you.
4370 DR. KING: I could add a clarification as well, because you asked about condition of licence. So I would just stress that, yes, we would agree to a condition of licence around equity in employment but in hand with that, we would also agree to a condition of licence for non-profit governance, as well as equitable representation for Indigenous people and people living with disabilities in their language and news and information programming, and then, finally, a conditional licence around Category 1 news in French and English.
4371 COMMISSIONER SIMARD: Thank you.
4372 I have a very specific question. In your view, how many languages should be offered on this service?
4373 DR. KING: It was mentioned that ethnic communities across Canada are growing, so I do think that using the current census is definitely a good reference. I think that representing Indigenous languages not only speaks to some of the issues that CMAC raised in our intervention with regard to international binding agreements that Canada has signed onto, but also the Broadcasting Act and also the criteria of this Notice of Consultation as well. So therefore I do think that there should be Indigenous representation in language as CMAC put forward.
4374 In terms of how many languages, it is important that a new service doesn’t displace communities who are currently finding service in our system, so I think those services, those communities who are already receiving services from Rogers Omni, including those who were receiving services and are perhaps not receiving services now, should be receiving, as well as all of the biggest groups in Canada’s census with regard to third languages speaking.
4375 I also want to speak to the fact that I don’t recall -- and I haven’t reviewed fully all of the transcripts from the hearing because they’re not yet available. But it is important to think about the capacity of the various Applicants to sustain, providing a diversity of languages that are representative of all of the different languages that could be represented.
4376 And in terms of where the Applicants are broadcasting from, CMAC, as you know, is based in Montreal. You yourself have spent in Montreal. Montreal is known as the capital of third languages in North America. And in terms of the capability to reflect a diversity of languages and employ a diversity of languages, Montreal would be a great place to launch such an initiative and grow it from.
4377 COMMISSIONER SIMARD: I don’t know if you have listened to the Applicants or the Applicants’ presentations. Their proposals are different in terms of how many offices, regional facilities they should put forward. So what are your views on that; on the need to have regional offices across Canada?
4378 DR. KING: There's a need. There’s also a capability to grow that into the licence. And so I would caution the CRTC to not expect a new licensee to launch immediately from multiple locations across Canada, especially if we’re trying to grow a new service that’s providing for those who are already currently receiving service, as well those who need services, such as an Indigenous language programming or content that reflects disabilities communities in diverse languages.
4379 And so I do think that there needs to be a coast-to-coast presence for a national news service but that should be expected to roll out throughout the licence term.
4380 DR. ODARTEY-WELLINGTON: And if I may add to what Dr. King just said. It is important that growth, whether in terms of the number of third languages offered or growth in terms of a regional presence is not driven by an economic imperative, but by a commitment to serve in these communities that evolve as the landscape of Canadian demographics change.
4381 COMMISSIONER SIMARD: Thank you. The other question refers to rate, wholesale rate. As you know, ICT, so for Tele1, is proposing the highest wholesale rate of any application. In your view, is the high wholesale rate proposed by ICT justified?
4382 DR. KING: So with regard to the rate, I wanted to bring up first that the issue is that groups, particularly Canada's diverse ethnic communities, currently do not have adequate representation and reflection across the system. This can be found as evidence provided in the academic scholarship we pointed to, it's also been presented multiple times in this hearing, and it's also available in the archives of CRTC data that's been released over the years.
4383 For the CRTC to deliver on the objections of the Act, it has no choice to make sure -- except to make sure that there is mechanisms available to achieve that. So this is the priority. If the current system doesn't provide representation, then the CRTC has to intervene and provide mechanisms to correct that.
4384 In terms of the current mechanism, we have the mandatory fee, and so that is what we can use. On a side note, the mandatory fee mechanism is meant to be paid for by the BDUs for their privilege to operate at a profit using the public goods, specifically, the access that they have to the public infrastructure to be able to do their broadcasting and the fact that they monetize Canadian audiences.
4385 So if the CRTC wants to envision a new way to meet the needs expressed by communities who are before you, who have said hey, we need this much to do and achieve a better service, then the CRTC has to address a new consultation on the future of broadcasting and we can look at new funding mechanisms to address the need. But currently, you have a request for you -- before you from the communities on what they need to have a service that's currently not being provided. And so we would support that.
4386 COMMISSIONER SIMARD: Thank you very much. Thank you for your intervention. Those were my questions.
4387 THE CHAIRPERSON: Then I thank you.
4388 Counsel, any questions?
4389 There being none, I thank you very much for your submissions. Much appreciated.
4390 And with that, we will recess for today, resuming tomorrow morning at 9:00 a.m. for the last phase of the proceeding. Thank you. Thank you all. Bon aprés midi.
--- Upon adjourning at 2:59 p.m.
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