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TRANSCRIPT OF PROCEEDINGS BEFORE
THE CANADIAN RADIO‑TELEVISION AND
TELECOMMUNICATIONS
COMMISSION
TRANSCRIPTION
DES AUDIENCES DEVANT
LE
CONSEIL DE LA RADIODIFFUSION
ET
DES TÉLÉCOMMUNICATIONS CANADIENNES
SUBJECT / SUJET:
Proceeding on the Canadian Television Fund (CTF)
Task Force Report /
Instance concernant le rapport du Groupe de
travail
du Fonds canadien de télévision (CTF)
HELD AT: TENUE À:
Conference Centre Centre de conférences
Outaouais Room Salle Outaouais
140 Promenade du Portage 140, Promenade du Portage
Gatineau, Quebec Gatineau (Québec)
February 7, 2008 Le 7 février 2008
Transcripts
In order to meet the requirements of the Official Languages
Act, transcripts of proceedings before the Commission will be
bilingual as to their covers, the listing of the CRTC members
and staff attending the public hearings, and the Table of
Contents.
However, the aforementioned publication is the recorded
verbatim transcript and, as such, is taped and transcribed in
either of the official languages, depending on the language
spoken by the participant at the public hearing.
Transcription
Afin de rencontrer les exigences de la Loi sur
les langues
officielles, les procès‑verbaux pour le
Conseil seront
bilingues en ce qui a trait à la page
couverture, la liste des
membres et du personnel du CRTC participant à
l'audience
publique ainsi que la table des matières.
Toutefois, la publication susmentionnée est un
compte rendu
textuel des délibérations et, en tant que tel,
est enregistrée
et transcrite dans l'une ou l'autre des deux
langues
officielles, compte tenu de la langue utilisée
par le
participant à l'audience publique.
Canadian
Radio‑television and
Telecommunications
Commission
Conseil
de la radiodiffusion et des
télécommunications
canadiennes
Transcript
/ Transcription
Proceeding on the Canadian Television Fund (CTF)
Task Force Report /
Instance concernant le rapport du Groupe de
travail
du Fonds canadien de télévision (CTF)
BEFORE / DEVANT:
Rita Cugini Chairperson
/ Présidente
Michel Arpin Commissioner
/ Conseiller
Michel Morin Commissioner
/ Conseiller
ALSO PRESENT / AUSSI PRÉSENTS:
Jade Roy Secretary / Secretaire
Shirley Ann Farley Hearing Manager /
Gérante de l'audience
Shari Faisher Legal
Counsel /
Bernard Montigny Conseillers juridiques
HELD AT: TENUE
À:
Conference Centre Centre de conférences
Outaouais Room Salle
Outaouais
140 Promenade du Portage 140, Promenade du Portage
Gatineau, Quebec Gatineau (Québec)
February 7, 2008 Le 7 février 2008
- iv -
TABLE
DES MATIÈRES / TABLE OF CONTENTS
PAGE / PARA
PRESENTATION BY / PRÉSENTATION PAR:
Shaw Communications 840 / 4101
CanWest MediaWorks 944 / 4636
Ryan Sutherland 983 / 4842
Comweb Group 1001 / 4958
Bell Broadcast and New Media Fund 1018 / 5066
Shaw Rocket Fund 1030 / 5112
Keith Mahar 1058 / 5236
Sanderson Layng 1068 / 5296
Aaron Goldman 1075 / 5326
Gatineau, Quebec / Gatineau (Québec)
‑‑‑ Upon
commencing on Thursday, February 7, 2008
at 0901 /
L'audience débute le jeudi 7 février 2008
à 0901
LISTNUM
1 \l 1 \s 40974097 THE
SECRETARY: Please take a seat.
LISTNUM
1 \l 14098 We
will now hear the presentation from Shaw Communications.
LISTNUM
1 \l 14099 Please
introduce yourself and your colleagues and you will then have 15 minutes for
your presentation.
LISTNUM
1 \l 14100 Thank
you.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 14101 MR.
STEIN: Thank you.
LISTNUM
1 \l 14102 Madam
Chair and Commissioners, I am Ken Stein, Sr. Vice‑President of Regulatory
and Corporate Affairs, Shaw Communications.
LISTNUM
1 \l 14103 With
me today on my right is Michael Ferras, Vice‑President, Regulatory
Affairs for Shaw, Cynthia Rathwell on my immediate left is Vice‑President,
Regulatory Affairs and Programming for Star Choice and Dean Shaikh, who is the
Director of Regulatory Affairs on my far left with Shaw Communications.
LISTNUM
1 \l 14104 Let
me say at the outset that Shaw is strongly committed to strengthening and
improving the Canadian broadcasting and communication systems.
LISTNUM
1 \l 14105 We
have over 3.3‑million customers who appreciate our commitment to service,
to providing quality programming and to choice.
We have invested billions of dollars in our systems, offering people
across Canada the best and newest advantages of cable, satellite, Internet and
telecommunications technology.
LISTNUM
1 \l 14106 We
employ over 9,000 people who, as you know, are proud and loyal employees.
LISTNUM
1 \l 14107 We
do all this in a very competitive environment, where our customers have a wide
and growing range of choices to meet their entertainment, information,
communications and broadcast needs.
LISTNUM
1 \l 14108 Now,
I would like to outline our views of the Canadian Television Fund.
LISTNUM
1 \l 14109 It
is well known that Shaw has fundamental problems with the CTF, its performance,
its governance and how it has spent $2.5‑billion. We believe that the CTF is a failure.
LISTNUM
1 \l 14110 The
process to address the failure of the CTF has taken much too long. This year alone another $270‑million,
including $60‑million from Shaw cable and satellite subscribers has been
wasted.
LISTNUM
1 \l 14111 Efforts
to try to fix the CTF are doomed and will only delay our progress towards a
goal of building a strong Canadian production industry.
LISTNUM
1 \l 14112 Let
us deal with three irrefutable facts.
The CTF does not deliver programs that Canadians watch. Fact No. 2, the CTF has not leveraged
increased spending on Canadian programming.
And, fact No. 3, the CTF and the broader program financing framework has
not created a viable production industry.
LISTNUM
1 \l 14113 Cynthia.
LISTNUM
1 \l 14114 MS
RATHWELL: Thank you.
LISTNUM
1 \l 14115 Fact
No. 1, the CTF does not deliver programs that Canadians watch.
LISTNUM
1 \l 14116 We
have heard a lot of claims this week that CTF‑funded Canadian programming
is widely watched. The facts do not
support the claims.
LISTNUM
1 \l 14117 Despite
the CTF's infusion of over $2.5‑billion into Canadian independent
productions since 1996, viewing to non‑Canadian programming keeps
growing. As the CTF itself acknowledges,
viewing to foreign programming in 2005 to 2006 has increased in all the CTF‑supported
genres when compared against the previous year.
LISTNUM
1 \l 14118 With
respect to English language drama programming, a review of the CTF's annual
report also shows that it has failed to produce programming that Canadians want
to watch. It tells us that non‑Canadian
shows capture a whopping 83 per cent of all English language drama viewing,
that Canadian English language dramas that are not funded by the CTF have a 13
per cent viewing share and a mere four per cent of English language drama
viewing is to CTF‑funded productions.
LISTNUM
1 \l 14119 Yes,
that's right, only four per cent.
LISTNUM
1 \l 14120 We
keep hearing about CTF's success stories.
Actually BBM viewing data for English Canada tells a very different
story. We think it's very telling that
the CTF gets excited about the few occasions when a CTF‑funded CBC show
actually cracks the top 30 or when a CTF‑funded private broadcaster's
show makes it into the top 100. These
are rare events.
LISTNUM
1 \l 14121 Dean.
LISTNUM
1 \l 14122 MR.
SHAIKH: Thank you, Cynthia.
LISTNUM
1 \l 14123 Fact
No. 2, the CTF has not leveraged more spending on Canadian programming.
LISTNUM
1 \l 14124 The
vast majority of cable and satellite CTF contributions go to the licence fee
program. This program is meant to
provide a top‑up of licence fees to producers but, as we have heard, it
is not really a top‑up, it is a way for private broadcasters to reduce
the amount of money that they contribute towards licence fees. In this way, private broadcasters use CTF
money to subsidize their Canadian content obligations.
LISTNUM
1 \l 14125 At
the same time, Canadian broadcasters have devoted an increasing share of their
program expenditures to U.S. shows. The
numbers confirm this.
Private broadcasters' spending on
Canadian programming as a proportion of their total program expenditures has
actually declined from 55‑cents per programming dollar in 2000 to only 52‑cents
in 2006.
LISTNUM
1 \l 14126 If
the revenue share that private broadcasters allocated to Canadian programming
had stayed where it was in the year 2000, $300‑million more would have
been spent on Canadian content over the period from 2000 to 2006.
LISTNUM
1 \l 14127 So,
perversely, cable and satellite customers' contributions which were supposed to
increase Canadian programming expenditures actually allow private broadcasters
to put a bigger share of their money toward buying U.S. programming than to
buying Canadian programs.
LISTNUM
1 \l 14128 Mike.
LISTNUM
1 \l 14129 MR.
FERRAS: Fact No. 3, the CTF and the
broader policy framework have failed to create a viable Canadian production
industry.
LISTNUM
1 \l 14130 Producers
and creators say that without the CTF there will be no Canadian production industry,
but the reality is there is no industry now.
As one MP said, it's a house of cards.
LISTNUM
1 \l 14131 Building
a viable programming industry is critical to Canada's future as a knowledge‑based
economy. Last June the Conference Board
awarded Canada a "D" in innovation, 14th among 17 OECD countries
examined. They called this woefully
inadequate.
LISTNUM
1 \l 14132 As
the Conference Board recognized, innovation is central to Canada's
competitiveness and sustainable prosperity in the global digital marketplace.
LISTNUM
1 \l 14133 Our
success will require innovation, investment and responding to the demands of
consumers, not subsidies, bureaucratic funding criteria and market
distortions. It also requires strong
companies and strong industries that do not require ongoing institutionalized
subsidies.
LISTNUM
1 \l 14134 Originally
federal and provincial tax credits were intended to build strong production
companies, but the credits were instead diverted to financing one‑off
projects along with the CTF and other private funds.
LISTNUM
1 \l 14135 So
today, as a result of Telefilm and CTF policies, producers use subsidies and
incentives not to build sustainable businesses but to cover an incredible 70
per cent of the financing of CTF‑funded drama.
LISTNUM
1 \l 14136 In
total Canada's huge and complex system of subsidies for television amounts to
about $1‑billion each and every year, $650‑million a year from
federal and provincial tax credits, $250‑million from the CTF and the
remainder from grants and private funds and Canadians get no return for this
massive subsidy.
LISTNUM
1 \l 14137 The
CTF talks about a five per cent return, but hold on, they don't actually mean
you get your investment back. If the CTF
puts out one‑million, it gets back 50,000 total, that's it, the one‑million
is gone.
LISTNUM
1 \l 14138 This
whole approach is a failure that will continue to drain our creative art
budgets and affect our tax expenditures on arts and culture as well as our
capacity to develop real viable businesses that deliver programs that people
will actually be interested in watching.
LISTNUM
1 \l 14139 The
only way Canada will have a meaningful voice in television production is to
build a real industry with innovative, high quality and competitive product and
sustainable employment.
LISTNUM
1 \l 14140 Ken.
LISTNUM
1 \l 14141 MR.
STEIN: In closing, let us be absolutely
clear about one thing. We at Shaw are
not against Canadian producers or content.
Shaw has pressed for change to Canadian program financing because we
want more, not less, high quality Canadian content. We want Canadian programs that Canadians will
actually watch.
LISTNUM
1 \l 14142 Everything
that we do at Shaw is geared to delivering value to our customers. That is fundamental to our success in an era
of choice and competition. It is also
essential for the Canadian broadcasting system.
If customers do not like the Canadian content they receive, their
loyalty to us and the broadcasting system will be eroded. Customers do not have to look far to find
lots of choice outside of our system.
LISTNUM
1 \l 14143 It
is clear to us that the program financing system in Canada needs to change
radically if Canadian programming is to become relevant and competitive. It is also clear to us that this process is
going nowhere. It has been dragging on
for a year and we have heard very few creative proposals for change.
LISTNUM
1 \l 14144 We
had hoped that other stakeholders would exhibit a willingness to create a
better model and to build an industry.
They have not.
LISTNUM
1 \l 14145 From
the beginning it has been clear that funding recipients were only interested in
keeping the current system going and the money flowing. They were determined to say and do anything
to marginalize the views of cable and satellite companies that real change was
required. This hearing has confirmed our
suspicions.
LISTNUM
1 \l 14146 Several
stakeholders, including CBC, stated that BDUs have no right to determine how
their customers' money is spent. This is
in spite of our massive financial contribution to their industry.
LISTNUM
1 \l 14147 They
also said the cable and satellite contributions are just like taxes and that
paying them does not entitle the taxpayer to determine how the money is
used. For once the CBC shares at least
part of Shaw's viewpoint, CTF levies are just a tax. It is consumers' money and they deserve to
get it back.
LISTNUM
1 \l 14148 So,
we think the best course of action is simply to remove the contributions of
satellite and cable customers from the CTF and give the money, all of it, back
to those who paid for it in the first place, Canadian viewers.
LISTNUM
1 \l 14149 Ultimately,
with all the myriad of choices available to Canadians, we must put consumers
first if we are to succeed at creating a strong and sustainable domestic
production industry.
LISTNUM
1 \l 14150 On
this basis we recommend the following action plan. Consists of seven actions.
LISTNUM
1 \l 14151 First,
take a whole new approach to building a Canadian program production industry
that focuses on giving consumers programming that they want to watch.
LISTNUM
1 \l 14152 Two,
base the new approach to Canadian program production on solid investment
principles that encourage private sector investment.
LISTNUM
1 \l 14153 Third,
eliminate the five per cent tax on Canadian cable and satellite customers.
LISTNUM
1 \l 14154 Four,
require Canadian broadcasters to make Canadian programming their No. 1 priority
in prime time.
LISTNUM
1 \l 14155 Five,
meet government policy objectives using government funding and appropriate
government agencies.
LISTNUM
1 \l 14156 And,
six, provide revenue‑generating opportunities on the community channel
and video on‑demand services to support Canadian programming on these
services.
LISTNUM
1 \l 14157 And,
finally, allow DTH services to offer a channel to support community expression
throughout their markets.
LISTNUM
1 \l 14158 Thank
you very much, Madam Chairperson. We're
pleased to answer any questions you may have.
LISTNUM
1 \l 14159 THE
CHAIRPERSON: Thank you, Mr. Stein and
your colleagues for your participation this morning.
LISTNUM
1 \l 14160 I
am sure that everyone in this room agrees that we all do have a common goal and
that is to contribute and help to build a system, as you say, where Canadians
will continue to have a wide and growing range of choices to meet their entertainment,
information, communications and broadcast needs. That is a common goal of everyone in this
room.
LISTNUM
1 \l 14161 You
did speak about irrefutable facts and the Canadian broadcasting system
currently has a number of irrefutable facts as well.
LISTNUM
1 \l 14162 We
are in a 500‑channel universe, more than ‑‑ 500 plus
channel universe and those are services that are available to Canadians, we
won't even talk about unregulated media.
LISTNUM
1 \l 14163 We
know that broadcasters are responsible for their schedules, certainly the CRTC
doesn't get involved in what goes on the air, it's totally their
responsibility.
LISTNUM
1 \l 14164 CTF‑funded
programming, according to their submission, makes up only seven per cent of
prime time of the four over‑the‑air English language broadcasters.
LISTNUM
1 \l 14165 Broadcasters
spend time, money, and I would even say sweat equity on audience research,
including focus groups.
LISTNUM
1 \l 14166 They
spend time, money and sweat equity working with producers in the development stages.
LISTNUM
1 \l 14167 Do
you really think that Global, because they are sitting in the room, is saying,
"Gee, at 7:30 on Sunday night I am going to put `Da kink in My Hair' on
because it's going to bomb"?
LISTNUM
1 \l 14168 Isn't
it in the best interest of the broadcasters to ensure that everything they do
is going to serve the needs of Canadians, and entertain them, and inform them,
and keep them on the dial from one show to the next?
LISTNUM
1 \l 14169 Sometimes
things just don't work, despite all of the audience research, despite all of
the focus groups, despite the money, despite the sweat equity.
LISTNUM
1 \l 14170 MR.
STEIN: Did you want me to answer that?
LISTNUM
1 \l 14171 THE
CHAIRPERSON: Absolutely.
LISTNUM
1 \l 14172 MR.
STEIN: I think that's a perception of
the model that we don't think is correct.
We believe that there should be Canadian programming in prime time, and
that it is the responsibility of broadcasters to provide that by whatever means
they can.
LISTNUM
1 \l 14173 That's
what we believe, and for people to say that the audience and economics don't
work, we say: Why doesn't it work?
LISTNUM
1 \l 14174 And
we get answers like: There is not enough
money in the system. It costs this much
money to produce something that has the same quality as an "ER".
LISTNUM
1 \l 14175 And
we say that, when we build our cable networks, we don't go out and say,
"Hey, we don't have enough people in Hinton, Alberta to build the best
cable network in the world," we do it.
LISTNUM
1 \l 14176 We
step up to the plate and we make the investments that we need to make to ensure
that Canadians get the best quality cable/satellite service, internet services,
telephony services they can get, and we think the broadcasters have the same
responsibility. Their responsibility is
to do this.
LISTNUM
1 \l 14177 I
think we have been trapped into a model of subsidy and regulation that has not
achieved the goal in meeting audience requirements. I think that if we all just shook our heads
and came up with a different view of it, we would find different answers to it.
LISTNUM
1 \l 14178 I
cannot believe, in fact I find it insulting to think that, as a Canadian, we
cannot produce a video product, in the English language, which is the major
language, predominant around the world ‑‑ that we cannot
produce that product ‑‑ that we aren't innovative enough, we
aren't creative enough to produce that product and make it an outstanding
success in Canada and around the world.
LISTNUM
1 \l 14179 I
think that's a doable thing, and I think for us to say that we can't do
that ‑‑ I don't accept that.
LISTNUM
1 \l 14180 THE
CHAIRPERSON: Let me ask you this, Mr.
Stein, because you say that you want to develop real, viable businesses that
deliver programs that people will actually be interested in watching. How can you ensure that these will be
programs that Canadians will actually be interested in watching?
LISTNUM
1 \l 14181 What
elements will you include in this plan to make sure that everything that is
produced will be programs that Canadians want to watch?
LISTNUM
1 \l 14182 MR.
STEIN: I think, fundamentally, we
believe that if you start treating the business as an opportunity to invest and
to develop products, whether you are in the music business or you are in the
television business, that is how you succeed in the marketplace, by developing
products that consumers want.
LISTNUM
1 \l 14183 That
is the trick in any business. There is
no magic answer to it.
LISTNUM
1 \l 14184 But
to presume that we will fail at it, I think, is the wrong presumption. I think there is enough of a desire in
Canadians to have Canadian programs, to be able to watch Canadian programs, and
to identify with them. They are very
proud of the successes of Canadians when they reach international fame and attention,
and I think we can do it.
LISTNUM
1 \l 14185 We
have done it in other cultural areas, and I think we can do it in this area as
well. I think it comes across by
requiring people to do certain things to meet their responsibilities, and it
also requires an investment approach.
LISTNUM
1 \l 14186 I
think that part of the problem we have is because we are into a subsidy
approach. We look at programming as a
cost. We don't look at it as an
opportunity to create a new business, we always talk about the costs of
it ‑‑ the licence fees, the A, B and C costs, and the tax
subsidies, and the financing.
LISTNUM
1 \l 14187 The
experts in program production in Canada are the lawyers and the bankers, and I
think that's wrong. I think that if we
had more opportunities for creative people to be creative, to be supported by
investors, and to take that approach, we would be better off.
LISTNUM
1 \l 14188 THE
CHAIRPERSON: Again, like I said in my
very first question, what I am looking for is a real, concrete plan to give us
comfort when we walk away from here to say:
You know what? The Shaw people
really have a plan that is going to allow high‑quality Canadian
production to occur in this country that will garner large audiences.
LISTNUM
1 \l 14189 Like
I said, broadcasters currently use a number of methods. They use research, they use focus groups,
they look at what has worked in other jurisdictions, and can it be adapted for
the Canadian audience.
LISTNUM
1 \l 14190 I
need a more concrete plan from you.
LISTNUM
1 \l 14191 MR.
STEIN: I think, when you deal in a competitive
environment, first of all, there is no certainty. That's why companies succeed and companies
don't succeed.
LISTNUM
1 \l 14192 THE
CHAIRPERSON: And that's why programs
succeed and programs don't succeed.
LISTNUM
1 \l 14193 MR.
STEIN: Exactly.
LISTNUM
1 \l 14194 But
the one thing we do know is, if you just do things on a cost basis, and on an
ongoing basis, you don't succeed.
LISTNUM
1 \l 14195 We
always are faced, in areas where there have been traditional losers, with
basically saying, "Well, it can't be done any other way," and we
think that's wrong.
LISTNUM
1 \l 14196 We
have laid out an action plan. People may
think it's a drastic action plan, but we think drastic action is called
for. We think that giving the money back
to customers, giving customers more choice, streamlining the system and the
obligations in the system, is a major part of that.
LISTNUM
1 \l 14197 The
second part of it is to say, "Okay, let's pull together a view of how to
make this into an industry," not how we are going to fund particular
projects.
LISTNUM
1 \l 14198 When
I was in government, we used to always get preoccupied by the fact that people
were always dealing with today's issue rather than thinking about what the
overall ‑‑ Where are we going?
Where are we going to end up?
LISTNUM
1 \l 14199 It's
a great failure that we get caught up in the particular issue that is facing
us. So you get involved in all of these
transactions.
LISTNUM
1 \l 14200 The
best policies and the best direction comes when you have a plan that says: Here is where we want to get to, so let's see
how we get there. Let's work this out in
how we get there.
LISTNUM
1 \l 14201 I
think the Commission started on that process when Mr. Shaw and I met with the
Chairman and the Vice‑Chairman.
That was a start to trying to find out how to solve this process. But I don't think it is getting anywhere
because everybody is trying to defend the status quo.
LISTNUM
1 \l 14202 We
are saying: How can you defend a status
quo that depends on a $2 billion subsidy every year? That is not acceptable to Canadians.
LISTNUM
1 \l 14203 How
do you accept a status quo where you get no return on that investment? That is not acceptable.
LISTNUM
1 \l 14204 We
think that it should be possible, as it is in any other area of activity of
human life, to create value; and to create value out of culture is, I think, a
very important objective, and we think that can be done.
LISTNUM
1 \l 14205 But
I think it starts with putting the consumer first.
LISTNUM
1 \l 14206 THE
CHAIRPERSON: Points 1, 2 and 3 of your
Action Plan are clear. You
obviously ‑‑ and I am not saying this facetiously, I do
apologize, but you obviously want us to repeal the requirement that cable and
satellite companies continue to contribute 5 percent.
LISTNUM
1 \l 14207 MR.
STEIN: Yes.
LISTNUM
1 \l 14208 THE
CHAIRPERSON: Okay.
LISTNUM
1 \l 14209 "Require
Canadian broadcasters to make Canadian programming their number one priority in
prime time."
LISTNUM
1 \l 14210 What
more do you need the Commission to do in order to fulfil that objective?
LISTNUM
1 \l 14211 MR.
STEIN: We have rules, as cable
distributors and satellite distributors, that we have to carry ‑‑
we have carriage rules, linkage rules, packaging rules ‑‑ we
have all of these rules that require us to carry services.
LISTNUM
1 \l 14212 We
are required to make sure that we are predominantly Canadian, that the services
we offer are predominantly Canadian. So
we think that the same requirement should be applied to broadcasters.
LISTNUM
1 \l 14213 We
note that when the financial parts of the papers comment on the competitiveness
of CTV and Global ‑‑ and I am talking about the English‑language
market ‑‑ they say: CTV
has a better U.S. lineup than Global.
Or, is Global going to get back into the game with a better U.S. lineup?
LISTNUM
1 \l 14214 They
never ever talk about the Canadian shows as part of the competitive lineup, and
we think that is discouraging. We think
that we are required, as distributors, to be predominantly Canadian in what we
offer to our customers, and we think the same should apply to the licensees who
have broadcast licences.
LISTNUM
1 \l 14215 THE
CHAIRPERSON: Mr. Stein, I know that you
know the rules. I know that you know
that OTA broadcasters are required to broadcast 60 percent Canadian content
overall, and 50 percent in prime time. I
know that you know that there is a requirement to do priority programming in
the heart of prime time.
LISTNUM
1 \l 14216 MR.
STEIN: Yes.
LISTNUM
1 \l 14217 THE
CHAIRPERSON: How much more of a priority
can we say to the broadcasters that Canadian content has to be ‑‑
LISTNUM
1 \l 14218 MR.
STEIN: I think what we look at is, when
you look at the CTF programs, the funded programs, and where they are on the
dial, it isn't acceptable.
LISTNUM
1 \l 14219 I
am saying that if you explored that with people and said, "How do we do
it," you would have a better chance of success than not. That's all I am saying.
LISTNUM
1 \l 14220 THE
CHAIRPERSON: I think your Points 6 and 7
are best dealt with at the BDU specialty hearing coming up in April.
LISTNUM
1 \l 14221 MR.
STEIN: We just like to argue them at
every opportunity.
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 14222 THE
CHAIRPERSON: I am pretty sure you are
going to be there.
LISTNUM
1 \l 14223 Should
the Commission decide not to repeal the requirement that BDU and cable need to
make a contribution, is Shaw willing to start up its own fund with that money?
LISTNUM
1 \l 14224 MR.
STEIN: No. We believe that our best ability to invest in
programming would be through our own means.
We think, in the same way that broadcasters have made arguments to have
control over their investments in programming, that our view would be to be
involved in those activities, in terms of supporting Shaw TV, supporting a
channel for community expression on the satellite services.
LISTNUM
1 \l 14225 We
think that would be the appropriate way to do it.
LISTNUM
1 \l 14226 It
goes down to why we separated the two companies, Shaw and Corus. We found that, to meet the objectives of
developing great children's programming and other kinds of entertainment programming,
that wasn't something that we felt ‑‑
LISTNUM
1 \l 14227 We
felt that would be better done by an entity that was on its own, focused on
delivering those services.
LISTNUM
1 \l 14228 We
think that the money within a corporation should be used to invest in the kinds
of things it does best, and that's how we would proceed. We don't believe in funds to that extent.
LISTNUM
1 \l 14229 Cynthia
would like to say something.
LISTNUM
1 \l 14230 MS
RATHWELL: To add to that, slightly, I
think we would like to emphasize the contributions that we already make, which
include innovation, providing a predominance of Canadian services to Canadian
viewers, expanding the market for digital services and the accessibility of the
whole broadcasting system to subscribers across the country, which was really
driven largely by DTH at the outset.
LISTNUM
1 \l 14231 Also,
the programming affiliation fees that we pay to programmers are already
significant.
LISTNUM
1 \l 14232 So,
I think, from our perspective, we are already making a very, very solid and
admirable contribution to the Canadian broadcasting system. Where we get a bit tripped up is us paying 5
percent into a fund, when broadcasters have failed to use the fund to increase
their own proportionate expenditure to Canadian programming.
LISTNUM
1 \l 14233 As
Dean remarked earlier this morning, we have seen a trend over the last five or
six years, where they are actually spending more and more of their programming
budgets on American programming.
LISTNUM
1 \l 14234 So
while on the one hand it may sound superficially unreasonable that we don't
want to put 5 percent into a fund, if you look at our fundamental reasons for
it, which are that we are already making an incredibly substantial
contribution, and broadcasters, on the other hand, don't really seem to be
pulling their weight, then perhaps that casts a bit of a different light on our
response.
LISTNUM
1 \l 14235 MR.
STEIN: If I could just be specific about
that ‑‑ and I should have made this comment earlier ‑‑
this year we are going to be investing about $650 million in our capabilities
to offer Canadians Canadian services.
That means going digital, moving at more hi‑speed internet
services for Canadians, competing with services that ‑‑ as you
point out, new media services that we have to compete with.
LISTNUM
1 \l 14236 Every
day we are making a huge investment in terms of allowing Canadians to receive
those services, and we have to step up to the plate. It is a huge requirement on the company to be
able to do this, and that's what our job is.
That's what our responsibility is, to be able to roll out those services
to Canadians, and we are proud of the fact that ‑‑
LISTNUM
1 \l 14237 I
have regulatory people who work for me across the country, and we go to every
community we serve. Western Canada is an
area of smaller communities, and we go to all of those communities, and there
is not a week goes by that people don't come back and say: This community was really terrifically happy
that we just put the new fibre nodes in and we rolled out high speed internet
into this community. And you know, we
are just so proud of that and they will talk about how involved we are in the
community and how much they appreciate Shaw being there.
LISTNUM
1 \l 14238 So
we may not get a lot of accolades in Ottawa but we sure as hell get them out
there.
LISTNUM
1 \l 14239 THE
CHAIRPERSON: My only ‑‑
well, one of the flaws that I see; one of the things I can't agree with and I'm
going to take a little bit of a Von Finckenstein approach when I say one of the
things I can't agree with ‑‑ I can't buy the argument that
broadcasters simply don't care about 60 percent of their schedule and 50
percent of their primetime and that they don't invest in the kind of
programming that is going to work for them and primarily for their
audiences. They too make a sizeable
investment in their plants, in converting them to digital, in high ‑‑
HD transmitters. For every cap X expense
that the distribution industry has so too do broadcasters. And when you are talking about 50 percent of
primetime it is absolutely in their best interests to ensure that that
programming works.
LISTNUM
1 \l 14240 MR.
STEIN: Well, first of all, they do
care. We know that. We just say the way the system ‑‑
you know, a system sets up perverse incentives for people. You know if there is money on the table to
take to do something one will do it. I
mean, I think Mr. Fecan addressed that very well at the hearings that he
attended recently. They do care.
LISTNUM
1 \l 14241 And
there are shows, non‑CTF funded shows like Canadian Idol and Corner Gas
that are excellent shows. Jim might not
agree with me, but I think they are.
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 14242 THE
CHAIRPERSON: You know what, Mr. Stein,
it doesn't matter what you think, what I think or what Jim thinks.
LISTNUM
1 \l 14243 MR.
STEIN: That's right, but well that's my
point. That's my point. My point is that you have to get the audience
and you have to get Canadians to support it.
LISTNUM
1 \l 14244 And
we just think that the system itself is setup in a way that maybe it
discourages broadcasters, I mean in terms of how they make their investments in
programming, you know. And I think that
that's what has to be addressed, is how do you turn it into a viable industry? Maybe there are rules and regulations they
don't like. I'm sure they will and they
have addressed them.
LISTNUM
1 \l 14245 So
I think that it's not a question of their desire. It's a question of how the system is created
and in a way that we aren't achieving ‑‑ and frankly, I don't
think we are achieving the objectives set out in the Broadcasting Act in that
sense. And I think that's ‑‑
it's got to be a wakeup call for the whole system.
LISTNUM
1 \l 14246 THE
CHAIRPERSON: And anything that you heard
over the last three days, either the Rogers proposal or the Astral proposal;
nothing that you have heard gives you comfort that this can be fixed within the
parameters?
LISTNUM
1 \l 14247 MR.
STEIN: My conclusion over the last few
days is that it's worse, that people are not willing to face up to the
difficulties. They are not willing to
face up to the fact that $2.5 billion has been spent without the objective
being achieved. So I haven't heard ‑‑
I have heard more bad things than good things.
LISTNUM
1 \l 14248 Mike.
LISTNUM
1 \l 14249 MR.
FERRAS: Just to follow Ken there, I
think we are looking at this through the lens of the CTF and the $2.5 billion
that has been spent. I mean, that's just
a huge amount of money.
LISTNUM
1 \l 14250 I
remember back when I think ‑‑ it's in my ‑‑
if I go back to my career, that when the CFDC was setup in 1968 it started out
with $10 million to build a feature film industry and now we are talking about
$2.5 billion and we just ‑‑ when you look at what's happening
and the results through that lens, through the CTF, it's just not working
because it's a subsidy model and it's flawed.
It has not built an industry.
LISTNUM
1 \l 14251 It's
not so much about intentions of a broadcaster or are they committed or
not. I mean there is some debate about
that. In fact, I think we heard this
week from producers that some people would argue that the broadcaster's heart
is not with Canadian programming; it's with trying to maximize audiences
through maximizing simultaneous substitution opportunities.
LISTNUM
1 \l 14252 So
I think our point is that the model will always be flawed as long as it's a
subsidy model and $2.5 billion dollars has run through the system and we
haven't got anywhere.
LISTNUM
1 \l 14253 THE
CHAIRPERSON: Let me assure you, Mr.
Ferras, that we are looking at this through the lens of Canadians.
LISTNUM
1 \l 14254 One
final question or line of questioning; I have here a letter on Rogers
letterhead that is on the public record.
And it's a letter signed by Mr. Lind to Doug Barrett, the Chair of the
Canadian Television Fund where he informs the CTF of the CCCE, the Canadian
Coalition for Cultural Expression whose ‑‑ it's a new
organization for the purpose of nominating cable broadcaster's distribution
undertaking directors to the CTF.
LISTNUM
1 \l 14255 I
see here that Jim Shaw was copied on this letter. Was Shaw Communications contacted and asked
to join the CCCE?
LISTNUM
1 \l 14256 MR.
STEIN: Yes, Jim Shaw did reply to that
letter and we said no.
LISTNUM
1 \l 14257 THE
CHAIRPERSON: Okay.
LISTNUM
1 \l 14258 Those
are all my questions. My colleagues may
have additional questions.
LISTNUM
1 \l 14259 Vice‑Chairman
Arpin.
LISTNUM
1 \l 14260 COMMISSIONER
ARPIN: I don't have that many but, Mr.
Stein, you said that one of the aims of Shaw Communications is to give
Canadians more choices. Well, what do
you mean by more choices, more Canadian choices or more foreign choices?
LISTNUM
1 \l 14261 MR.
STEIN: Well, we mean all. We feel very strongly that the system, the
broadcasting system has always been based on giving Canadians access first as a
priority to Canadian services and it has also been built on giving them access
to all of the services that are available that they want to have access to.
LISTNUM
1 \l 14262 So
when we talk about choice a good example would be ‑‑ and you
know where we do differ with others is on digital. When digital services were launched we gave
people the ability to pick one, two, five, 10 services. We got roundly criticized for it by the
programmers because people felt that consumers weren't going to buy it that way
but we had, you know, terrific success in moving our system to digital. I don't have the numbers right at hand but,
you know, our penetration on high speed, on digital HDTV is quite high.
LISTNUM
1 \l 14263 So
we are ‑‑ we want to offer our customers quality choices of
Canadian services. We recognize that
that's important. But you know,
sometimes we get slapped down because we offer things like WHL hockey that
nobody else is offering and we find a means to do it and then we get told that
we can't use it, can't do it that way.
LISTNUM
1 \l 14264 So
we are very interested in offering people choices and offering them Canadian
services. So it's ‑‑ we
don't think people should be limited in their choices. We think they should have access to anything
they want, whether it's books, magazines or television services.
LISTNUM
1 \l 14265 COMMISSIONER
ARPIN: Now, how do you think those
Canadian services; small population, big piece of land, not that many
households compared to other countries, how could they finance their operations
and come up with some interesting material if everything is sold piecemeal?
LISTNUM
1 \l 14266 MR.
STEIN: Well, we heard that cable
industry. I remember in the late
eighties we heard ‑‑ saying, "Well, you know, we can't
serve all these communities. We can't
get television up there". And I
think when I joined Shaw we had about 500 employees or something, 600, and we
now have 9,000.
LISTNUM
1 \l 14267 And
I think part of our objective ‑‑ part of the reason that we
were successful is we didn't accept that, that we basically said that we were
going to offer services, the highest quality services to work wherever people
are and we are going to be out there in the small communities and whether we do
it by cable or whether we do it by satellite we are going to do it. We are going to build the fibre and we are
going to go into those communities and we are going to offer the services.
LISTNUM
1 \l 14268 So
we ‑‑ I mean, we think this ‑‑ maybe it's
because we live in western Canada. We
think that the wild, remote, spread‑out spaces are actually an economic
advantage.
LISTNUM
1 \l 14269 COMMISSIONER
ARPIN: But that being said ‑‑
well, you may have the benefit of satellite to develop but Shaw Cable per se
doesn't cover all of Alberta and all of B.C.
There still are two small communities where Telus is offering the
service and where Shaw Cable has not yet ‑‑
LISTNUM
1 \l 14270 MR.
STEIN: I will find out where those
are. We will get there.
LISTNUM
1 \l 14271 COMMISSIONER
ARPIN: Now, another line of interrogating,
I think.
LISTNUM
1 \l 14272 At
the beginning of your presentation you said that you have invested billions of
dollars in your system offering people across Canada the best and newest
advantage of cable, satellite; internet and telecommunications technology. Those ‑‑ the last two
are ‑‑ I think good for you ‑‑ have not been
regulated by the CRTC. The CRTC has let
you and all the other players in the industry introduce the service and
introduce the wares into the system.
LISTNUM
1 \l 14273 Isn't
it a benefit for you that it's been done that way and then there ‑‑
couldn't there be a compensation somewhere for that benefit?
LISTNUM
1 \l 14274 MR.
STEIN: Well, the ‑‑ I
think first and foremost is that the requirements that are placed on the
company in terms of capital investment creating jobs, if that's what you're
referring to, that's part of what we want to do and what we want to grow
at. Our basic issue is the constraints
of the regulations in terms of the services we offer. We feel we step up to the plate in terms of
making the investments.
LISTNUM
1 \l 14275 It's
a very competitive environment. I mean,
you know, we were the first cable company to support Mr. Bernier on it and the
only one I think to support Mr. Bernier ‑‑ well, perhaps
VidÚotron, but we supported Mr. Bernier in terms of the forbearance
directive. And we basically said, okay,
we are going to be competitive. We have
to put the ‑‑ we are going to have to put the hundreds of
millions of dollars out there to do it, to be able to offer telephony services
and to be competitive with Telus but we are going to step up to the plate and
do it.
LISTNUM
1 \l 14276 You
know, one of the big issues we have is a lack of protection we get in the black
market. You know, we have ‑‑
the government is not acting. There have
been amendments in the Radio Communications Act. The black market is larger than Star Choice
but nobody seems to care about that. So
we have to compete with that all the time.
LISTNUM
1 \l 14277 We
also do have competition over the air as the U.S. services move to high quality
HDTV. There was an investor column the
other day in the Globe and Mail that talked about how much money the person
could save by going over the air as opposed to buying cable. So Canadians have all sorts of alternatives.
LISTNUM
1 \l 14278 In
Winnipeg, you know, we are in a head‑to‑head fight with MTS. And I think Mr. Engelhart made the point the
other day at Rogers and said, you know, back in the early nineties when all
these structures and regulations were put in place, cable penetration getting
close to 90 percent. Well, it's now 60
percent, you know.
LISTNUM
1 \l 14279 So
it's ‑‑ in terms of what we have to do as a company each and
everyday is we have to pour money out there and we have to offer our customers
services and service that makes us number one in the marketplace. It's very competitive and we are very
customer focused.
LISTNUM
1 \l 14280 COMMISSIONER
ARPIN: Now, the last thing is a
comment. I think you draw three
different facts and you elaborated on them and obviously we are going to hear
today and tomorrow the major English‑speaking broadcasters so they may
have an opportunity to share on your views.
And also we will hear back the CTF at the end of the hearing.
LISTNUM
1 \l 14281 But
I appreciate that you laid them down as clearly as possible so that we
have ‑‑ we could understand exactly what Shaw is trying to say
because it used various levels of language so far, but now I think here
it's ‑‑ well, it's well put and clear.
LISTNUM
1 \l 14282 Thank
you very much.
LISTNUM
1 \l 14283 THE
CHAIRPERSON: Except for one thing.
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 14284 THE
CHAIRPERSON: When I asked you earlier if
we decide to not eliminate the 5 percent tax, as you call it, "Would you
setup your own fund?" you said "no." Does that mean if we continue to require the
5 percent tax you will not comply?
LISTNUM
1 \l 14285 MR.
STEIN: We always comply.
LISTNUM
1 \l 14286 THE
CHAIRPERSON: But it will be under
protest?
LISTNUM
1 \l 14287 MR.
STEIN: There is a variety of ways. We are looking at it.
LISTNUM
1 \l 14288 THE
CHAIRPERSON: Okay. We will leave it at that.
LISTNUM
1 \l 14289 Thank
you very much. We will take a 10‑minute
break.
‑‑‑ Upon recessing
at 0944 / Suspension à 0944
‑‑‑ Upon resuming
at 0956 / Reprise à 0956
LISTNUM 1 \l 14290 LA
SECRÉTAIRE : Nous entendrons maintenant
la présentation de Quebecor Media. Vous avez 15 minutes pour
présentation.
LISTNUM 1 \l 14291 Merci.
LISTNUM 1 \l 14292 M.
PÉLADEAU : Bonjour, Madame la Présidente, Monsieur le Vice‑président,
Monsieur le Conseiller et personnel du Conseil.
LISTNUM 1 \l 14293 Je
m'appelle Pierre‑Karl Péladeau et je suis le Président et chef de la
direction de Quebecor Media et de Quebecor.
LISTNUM 1 \l 14294 Permettez‑moi
de vous présenter mes collègues et collaborateurs.
LISTNUM 1 \l 14295 À
ma droite imméduate, Pierre Dion, Président et chef de la direction du Groupe
TVA; Martin Picard, Directeur général, administration de la programmation, de
TVA.
LISTNUM 1 \l 14296 Luc
Lavoie, à ma gauche, Vice‑président exécutif de Quebecor; Pierre Lampron,
Vice‑président, affaires institutionnelles; et Édouard Trépanier, Vice‑président,
affaires réglementaires de Quebecor Media.
LISTNUM 1 \l 14297 Lorsqu'il
a créé le Fonds de production de câblodistribution, le 10 février 1994, le
Conseil a établi, et je cite l'Avis public CRTC 1994‑10 : « le
meilleur moyen de stimuler la production canadienne serait de hausser les
droits de diffusion, en contribuant à maintenir et à accroître la qualité des
émissions et en attirant des investissements privés grâce à l'augmentation des
recettes provenant des émissions canadiennes. »
LISTNUM 1 \l 14298 Ces
objectifs de performance n'ont jamais été rencontrés de façon satisfaisante.
LISTNUM 1 \l 14299 L'histoire
de ce fonds est marquée par de nombreuses crises qui ont abouti à un
détournement significatif des objectifs initialement poursuivis, au profit des
intérêts des membres de son conseil d'administration.
LISTNUM 1 \l 14300 En
regard des objectifs de performance, le bilan est peu reluisant.
LISTNUM 1 \l 14301 Le
fonds a englouti plus de 2,5 milliards dans une multitude de programmes qui, au
Canada anglais, ont eu peu de succès.
LISTNUM 1 \l 14302 Malgré
ces milliards de soutien public et privé, le marché canadien se caractérise par
une domination croissante de la production américaine au Canada, une
performance indigne d'un pays du G8 sur les marchés internationaux, ainsi
qu'une décroissance marquée de l'investissement étranger dans la production
canadienne.
LISTNUM 1 \l 14303 Sur
le marché québécois, le Fonds canadien de télévision n'est pas en mesure de
répondre aux besoins de la télévision généraliste privée et ignore les
nouvelles plateformes de diffusion en pleine croissance.
LISTNUM
1 \l 14304 We
have made this point in a thousand ways. We hope that this time it will be understood.
LISTNUM
1 \l 14305 We
are filing the correspondence and documents we have produced since our decision
on January 23, 2007 to suspend payments to the Canadian Television Fund.
LISTNUM 1 \l 14306 Alors,
nous sommes pour une meilleure diffusion du contenu canadien.
LISTNUM 1 \l 14307 Vous
constaterez qu'avec constance nous avons insisté sur notre engagement à
soutenir le financement, la production, la diffusion et la promotion du contenu
canadien et affirmé notre volonté de maintenir notre rôle de principal
contributeur privé au financement de la production canadienne.
LISTNUM 1 \l 14308 Nous
avons illustré le cul‑de‑sac dans lequel nous sommes avec le statut
actuel du Fonds canadien, sa gouvernance et ses orientations.
LISTNUM 1 \l 14309 Le
Fonds canadien est incapable de se rénover significativement et est impuissant
à répondre à nos besoins.
LISTNUM 1 \l 14310 Il
n'est pas en mesure, par exemple, de reconnaître la vidéo sur demande comme
diffuseur, malgré que notre service génère actuellement plus d'un million de
commandes par semaine.
LISTNUM 1 \l 14311 Nous
avons apporté toutes les preuves et réuni toutes les informations financières
disponibles pour démontrer que le principal diffuseur privé de langue française
au Canada, le seul en mesure de soutenir significativement le financement de
productions telles la dramatique et les émissions de variétés de qualité, ne
pouvait plus continuer dans sa voie tout en satisfaisant aux exigences du Fonds
canadien.
LISTNUM 1 \l 14312 Nous
vous avons démontré les modèles de financement de certaines séries dramatiques,
illustré que les revenus générés par l'antenne ne suffisaient pas à financer
correctement les émissions en question, qu'il fallait instaurer un nouveau
modèle de financement où les risques sont partagés et les revenus répartis en
conséquence.
LISTNUM 1 \l 14313 Permettez‑moi
de vous rappeler l'exemple de l'émission Vice caché : des revenus de 1,5
millions de dollars pour financer une licence de 2,1, qui résultent en une
perte pour TVA de 600 000 dollars.
LISTNUM 1 \l 14314 Vous
comprenez que des pertes semblables à répétition mettent en péril la viabilité
de l'entreprise.
LISTNUM 1 \l 14315 Nous
avons démontré que le Fonds n'est pas en mesure de financer, ce qui est urgent,
les productions destinées à être exploitées sur les nouvelles plateformes de
diffusion qui, au Québec en particulier, représentent une forme de bouée de
sauvetage pour la production originale.
LISTNUM 1 \l 14316 Les
jeunes s'y dirigent en masse et ils n'ont pas accès à suffisamment de nos
productions.
LISTNUM 1 \l 14317 Nous
avons démontré aussi que le Fonds n'était pas en mesure de soutenir
financièrement le développement et la production de nouveaux concepts de
programmes dont la télévision généraliste et les nouvelles plateformes de
diffusion ont besoin.
LISTNUM 1 \l 14318 Cette
incapacité nous rend tributaires des concepts étrangers, nous oblige à
importer, à adapter, plutôt qu'à développer notre potentiel créatif et à tenter
de l'exporter.
LISTNUM 1 \l 14319 Nous
avons démontré l'impossibilité de concilier, au sein d'un même conseil
d'administration, les intérêts des diffuseurs privés et ceux des diffuseurs
publics, tout simplement parce que nous n'avons pas les mêmes mandats ni la
même mission et nos imputabilités sont différentes : nous sommes imputables
à nos actionnaires, ils sont imputables au Parlement canadien.
LISTNUM 1 \l 14320 Nous
avons proposé, le 12 février 2007, une solution qui renforce les objectifs de
la Loi sur la radiodiffusion.
LISTNUM 1 \l 14321 Nous
avons proposé d'augmenter notre contribution annuelle de 19 à 30 millions, de
l'augmenter chaque année de 20 pour cent, de nous engager à investir plus de
100 millions sur trois ans, de renoncer aux contributions du ministère du
Patrimoine et de donner au CRTC toutes les garanties lui permettant de superviser
le respect de nos engagements.
LISTNUM 1 \l 14322 Je
me permets de répéter le paragraphe étant donné qu'il semble qu'un certain
nombre d'intervenants n'aient pas bien compris l'importance de notre
proposition, de notre contribution à la programmation canadienne, ainsi qu'à
tous les artisans du paysage audiovisuel.
LISTNUM 1 \l 14323 Nous
avons donc proposé d'augmenter notre contribution annuelle de 19 à 30 millions,
de l'augmenter chaque année de 20 pour cent, de nous engager à investir plus de
100 millions sur trois ans, de renoncer aux contributions du ministère du
Patrimoine et de donner au CRTC toutes les garanties lui permettant de
superviser le respect de nos engagements.
LISTNUM 1 \l 14324 Nous
avons démontré que notre proposition était à l'avantage de l'ensemble du
système de radiodiffusion dans le marché francophone, à l'avantage des
créateurs, des artistes et des artisans de la production en rappelant que la
contribution annuelle pour 2006 de Vidéotron, en vertu des règles actuelles,
est d'environ 15,2 millions, alors que l'enveloppe de TVA se situe à autour de
16,5 millions.
LISTNUM 1 \l 14325 Nous
nous sommes engagés à négocier avec les producteurs indépendants les conditions
d'un partenariat équilibré, les invitant à prendre des risques dans le
financement des productions ou à les rémunérer équitablement pour la prestation
de leurs services.
LISTNUM 1 \l 14326 Vous
noterez enfin que nous avons choisi, dès le début, entre l'alternative de
demeurer au Fonds canadien et donc de diminuer significativement notre volume
de productions originales ou de nous en retirer, mais pour en faire davantage.
LISTNUM 1 \l 14327 Nous
avons été déçus des propositions et recommandations du Rapport du Groupe de
travail pour les raisons suivantes.
LISTNUM 1 \l 14328 Le
CRTC ne fait pas écho à notre proposition de retrait volontaire et n'a pas
considéré ni commenté notre proposition d'investir plus de 100 millions de
dollars sur trois ans dans la production canadienne.
LISTNUM 1 \l 14329 La
solution proposée ne corrige pas les graves problèmes de gouvernance qui ont
été démontrés.
LISTNUM 1 \l 14330 Elle
entretient cette confusion des objectifs que nous avons décrite, consacre la
participation des publics et des privés au sein d'un même conseil et ne crée
pas de mesures efficaces pour assurer que l'objectif de performance de la
production canadienne soit rencontré.
LISTNUM 1 \l 14331 Ainsi,
cette proposition maintient cette aberration que nous retrouvons dans la
politique du Fonds canadien relative aux honoraires de production ‑
ou du producteur, pardon ‑‑ et aux frais d'administration, et
je cite : « Le Fond n'encourage pas les producteurs à réduire leurs
honoraires et leurs frais d'administration ou, encore à en reporter le paiement
pour boucler le financement de la production. »
LISTNUM 1 \l 14332 Vous
comprenez que ce n'est pas comme ça que les choses fonctionnent dans la réalité
commerciale.
LISTNUM 1 \l 14333 Elle
maintient le statu quo quant au mode de répartition des sommes disponibles
entre les bénéficiaires actuels et ne permet pas une révision significative des
programmes admissibles.
LISTNUM 1 \l 14334 Elle
laisse TVA et les promoteurs de contenus originaux sur les nouvelles
plateformes dans le cul‑de‑sac que nous avons démontré.
LISTNUM 1 \l 14335 La
proposition du CRTC ne permettrait pas à TVA de maintenir sa contribution à la
production et à la promotion du contenu canadien de grande valeur.
LISTNUM 1 \l 14336 Nous
ne comprenons toujours pas les motifs qui ont amené le Groupe de travail à ne
pas considérer notre proposition.
LISTNUM 1 \l 14337 Depuis,
les faits ont confirmé et accentué la crise du financement de la production
originale de qualité dans le marché francophone.
LISTNUM 1 \l 14338 TQS
est dans la situation que vous connaissez.
LISTNUM 1 \l 14339 Radio‑Canada
crée encore plus de pression sur le Fonds.
LISTNUM 1 \l 14340 Cette
télévision d'État continue de bénéficier d'un pourcentage fixe du Fonds
canadien et s'assure de s'accaparer le maximum des sommes disponibles pour
rencontrer les objectifs plus culturels imposés par le ministère du Patrimoine
au Fonds canadien, alors qu'il devrait appartenir au Parlement du Canada de
déterminer le niveau adéquat de financement.
LISTNUM 1 \l 14341 Les
décisions du Fonds canadien pour 2006 et 2007 ont conduit à des résultats
aberrants : les sommes attribuées à Groupe TVA baissent de 2 millions
(c'est‑à‑dire de 18,4 16,3 millions), alors que celles de TFO
augmentent de un million (de 3,7 à 4,75), illustrant une dynamique de
saupoudrage arbitraire et improductive.
LISTNUM 1 \l 14342 La
télévision spécialisée et payante accentue son emprise sur les revenus
publicitaires.
LISTNUM 1 \l 14343 L'écart
avec la télévision généraliste se creuse, mettant davantage de pression sur TVA
dans sa capacité à financer la programmation canadienne originale de qualité, celle
qui attire les téléspectateurs.
LISTNUM 1 \l 14344 La
résistance de la production indépendante se renforce.
LISTNUM 1 \l 14345 Malgré
le déclin reconnu de la télévision généraliste, leurs revendications sont
toujours plus exigeantes pour protéger leur rémunération et contrôler
l'exercice des droits d'exploitation.
LISTNUM 1 \l 14346 La
mainmise de la production indépendante sur le Fonds s'est maintenue aussi ferme
depuis le début de ce débat et leurs interventions prouvent, si cela était
nécessaire, leur intention de défendre leurs intérêts corporatifs, même au prix
de remettre en cause la possibilité pour TVA de maintenir son niveau actuel
d'investissement dans la production.
LISTNUM 1 \l 14347 Nous
avons aussi démontré qu'en raison de la taille et des caractéristiques du
marché francophone, l'impact des nouvelles technologies de diffusion et des
nouveaux médias, y est plus significatif et exige des solutions adaptées.
LISTNUM 1 \l 14348 Le
marché francophone a plusieurs traits distinctifs que reconnaît le CRTC.
LISTNUM 1 \l 14349 Le
plus important est lié aux revenus publicitaires qu'ils soient dits locaux ou
nationaux.
LISTNUM 1 \l 14350 Au
Québec, selon Nielsen, les investissements publicitaires représentent plus de
deux milliards tous médias confondus, dont 34 pour cent pour la télévision
totale (c'est‑à‑dire 717 millions).
LISTNUM 1 \l 14351 L'indice
de mesure usuellement utilisé pour évaluer le potentiel de revenus
publicitaires générés par la télévision est « le coût par mille ».
LISTNUM 1 \l 14352 Il
est, au Québec, historiquement beaucoup moins cher que celui du marché
ontarien. L'écart est en moyenne de 21 pour cent en faveur du marché ontarien.
LISTNUM 1 \l 14353 La
télévision privée au Québec doit composer avec la concurrence des télévisions
d'État (Télé‑Québec avec 3,1 pour cent et Radio‑Canada avec 13,4
pour cent) qui semblent ‑ ensemble, pardon ‑ génèrent
16,5 pour cent de parts de marché.
LISTNUM 1 \l 14354 La
télévision généraliste privée génère des auditoires largement supérieurs aux
télévisions généralistes privées du reste du Canada.
LISTNUM 1 \l 14355 TVA
représente 28,9 pour cent de parts de marché, TQS 11,3 (pour un total de 40,2
pour cent), alors que CTV et Canwest représentent respectivement 11,6 et 11,2
(pour un total de 22,8 pour cent).
LISTNUM 1 \l 14356 Ces
parts de marché supplémentaires ne se monnayent cependant pas en termes de
revenus publicitaires comparables.
LISTNUM 1 \l 14357 Les
émissions les plus performantes rejoignent des auditoires de plus de un million
de personnes et exceptionnellement supérieurs à deux millions.
LISTNUM 1 \l 14358 Ce
sont, la plupart du temps, des programmes originaux à budgets moyens ou élevés
que les télévisions généralistes sont les seules à pouvoir financer dans le
marché restreint du Québec.
LISTNUM 1 \l 14359 Le
potentiel de revenus publicitaires au Québec n'est pas suffisant pour
« monnayer » ces performances exceptionnelles.
LISTNUM 1 \l 14360 C'est
pourquoi, dans le marché francophone en particulier, la viabilité des
investissements dans la programmation canadienne passe obligatoirement par une
utilisation séquentielle des divers canaux de diffusion.
LISTNUM 1 \l 14361 Conclusion,
Madame la Présidente, le Fonds canadien est en crise, car il n'a pas la
capacité de s'adapter aux changements en cours.
LISTNUM 1 \l 14362 La
télévision généraliste privée, particulièrement TVA au Québec, fait face à des
pressions qui menacent sa capacité de maintenir le rôle de leader, qui est le
sien, pour la promotion du contenu canadien.
LISTNUM 1 \l 14363 TVA
investit annuellement plus de 100 millions dans la programmation canadienne,
tous genres confondus, y compris les programmes de nouvelles et d'affaires
publiques.
LISTNUM 1 \l 14364 On
ne semble pas réaliser que l'augmentation des coûts de production pour les
programmes originaux de fiction ou de variétés crée une forte pression sur la
possibilité pour TVA de maintenir son haut niveau actuel d'engagement envers
une information de qualité.
LISTNUM
1 \l 14365 Quebecor's
proposal has been criticized as self‑serving. It is no such thing.
LISTNUM
1 \l 14366 Our
purpose is not to garner the lion's share of public funding for Quebecor's
media outlets. On the contrary, we would forego public funding.
LISTNUM
1 \l 14367 Neither
is our purpose to deprive other broadcasters of contributions from the
distributors.
LISTNUM
1 \l 14368 By
renouncing its share of these funds, TVA would release more money than what
Vidéotron contributes.
LISTNUM 1 \l 14369 Notre
objectif, répétons‑le, est de tout mettre en oeuvre pour.
LISTNUM 1 \l 14370 Premièrement,
permettre à TVA de disposer des marges financières et de l'autonomie nécessaire
pour maintenir son haut niveau d'investissement dans la production du contenu
canadien et de sa diffusion.
LISTNUM 1 \l 14371 Et
deuxièmement, fournir tout le financement nécessaire afin que se déploient sur
les nouvelles plateformes du Groupe TVA les contenus adaptés qui, actuellement,
sont majoritairement américains.
LISTNUM 1 \l 14372 Ce
qui était vrai voici un an l'est dramatiquement plus aujourd'hui, et nous avons
eu récemment l'occasion de vous en faire part.
LISTNUM 1 \l 14373 L'opting
out que nous proposons représente la meilleure opportunité pour le CRTC
d'appuyer les objectifs de la Loi, et je la cite, à l'article 3, paragraphe
e) : « Tous les éléments du système doivent contribuer, de la manière qui
convient, à la création et à la présentation d'une programmation canadienne. »
LISTNUM 1 \l 14374 Notre
proposition permet aussi à notre entreprise de continuer de faire la preuve de
la grande valeur du contenu canadien sur notre marché et sur les marchés extérieurs.
LISTNUM 1 \l 14375 Le
statu quo, en revanche, se traduirait par une diminution significative de la
production canadienne originale à l'antenne de TVA, en particulier les genres
que seul TVA, parmi les diffuseurs privés, est en mesure de soutenir significativement,
c'est‑à‑dire la dramatique et les variétés de qualité.
LISTNUM 1 \l 14376 Certains
intervenants sollicitent la protection d'une réglementation plus sophistiquée
faite de plus d'obligations et de plus de contrôle.
LISTNUM 1 \l 14377 Pourtant,
le passé récent que nous avons vécu illustre que nous pouvons tenir nos
engagements et mieux réussir sans les contraintes de la réglementation.
LISTNUM 1 \l 14378 Ainsi,
dans le domaine de la téléphonie résidentielle, Vidéotron a réussi en moins de
trois ans, dans un environnement qui libérait les règles du marché, à brancher
636 000 foyers.
LISTNUM 1 \l 14379 Au
cours de l'année 2006‑2007, ce sont 238 000 nouveaux clients qui se sont
ajoutés, soit une augmentation de 60 pour cent.
LISTNUM 1 \l 14380 La
déréglementation a permis, pour la première fois au Canada, de baisser de façon
significative les prix de la téléphonie résidentielle aux consommateurs.
LISTNUM 1 \l 14381 Nous
voilà donc devant vous pour vous dire essentiellement deux choses.
LISTNUM 1 \l 14382 Permettez‑nous
d'offrir davantage d'émissions canadiennes véritablement significatives eu
égard aux objectifs de la Loi.
LISTNUM 1 \l 14383 Et
puisque le marché demande en premier lieu des émissions de télévision
originales de langue française, permettez aux règles du marché de jouer leur
rôle au lieu d'étouffer l'initiative par une réglementation abusive.
LISTNUM 1 \l 14384 Merci
beaucoup de votre attention.
LISTNUM 1 \l 14385 Nous
sommes évidemment prêts à répondre à vos questions.
LISTNUM 1 \l 14386 LA
PRÉSIDENTE : Merci, Monsieur Péladeau.
LISTNUM
1 \l 14387 Just
for the record, Quebecor has filed correspondence and documents, as was
referred to in their oral presentation, and the Commission has accepted. This documentation now will be available on
the public record.
LISTNUM 1 \l 14388 Commissioner
Morin?
LISTNUM 1 \l 14389 CONSEILLER
MORIN: Bonjour. Au cours des derniers
jours, j'ai posé la question à plusieurs groupe qui sont venus devant nous en
leur disant : « Écoutez, vous avez... le
groupe Quebecor qui propose de pratiquement doubler sa contribution à la
production canadienne et vous ne semblez pas très chaud à l'idée.
LISTNUM 1 \l 14390 Comment
vous expliquez que les groupes de syndicats ne soient pas de votre côté pour
réclamer, pour vous seconder dans votre proposition d'augmenter la production
de contenu canadien, d'augmenter le volume de production chez vous parce qu'au
fond, ce sont leurs emplois qui devraient en profiter, il me semble? »
LISTNUM 1 \l 14391 M.
PÉLADEAU: Merci, Monsieur Morin.
Effectivement, je pense que vous l'avez bien décrit. Nous sommes les premiers surpris
puisque ‑‑ et j'ai eu l'occasion de le répéter pour être bien
certain que les gens comprennent et vous avez également mis l'accent sur
l'importance de notre intervention.
LISTNUM 1 \l 14392 C'est
que nous sommes prêts à doubler les montants.
Et ces montants‑là vont évidemment participer à des retombées
économiques importantes dans tous les secteurs de la production, que ce soit,
évidemment, les producteurs, les premiers concernés, mais également les
artistes, les scénaristes, les techniciens qui vont bénéficier de ces sommes
importantes. Et c'est un engagement
clair et précis que nous prenons.
LISTNUM 1 \l 14393 Et
encore une fois, nous sommes tout à fait prêts à « subir » les règles de supervision
du CRTC à cet égard. Donc, une tierce
partie est en mesure de pouvoir adéquatement surveiller les obligations
auxquelles nous sommes prêts, nous voulons nouvellement assumer.
LISTNUM 1 \l 14394 Donc,
en toute honnêteté, effectivement, c'est une surprise. De notre côté, on a de la difficulté à
comprendre pourquoi les différents intervenants ‑‑
LISTNUM 1 \l 14395 On
n'accepte pas les contributions supplémentaires à l'intérieur d'un nouvel
environnement qui est celui qu'on a essayé de décrire depuis un certain nombre
de mois et d'années, une révolution numérique qui s'est produite il y a déjà
plusieurs années, un environnement concurrentiel qui, lui aussi, a permis à
l'ensemble de la structure industrielle de production d'évoluer.
LISTNUM 1 \l 14396 Mais
en même temps, aujourd'hui, lorsqu'on regarde le Fonds canadien, qui ne peut
évoluer puisque les règles qui ont été édictées par le Fonds canadien l'ont été
au moment où l'environnement était complètement différent, où il existait, en
fin de compte, une seule source de diffusion qui était la télévision
généraliste analogique ‑‑
LISTNUM 1 \l 14397 Aujourd'hui,
évidemment, on a évolué, tout autant au niveau numérique en télévision : vidéo sur demande, Internet, diffusion sur de
nouveaux canaux ‑‑ et c'est à cet environnement‑là,
aujourd'hui, que les règles du Fonds canadien ne sont pas en mesure de
répondre.
LISTNUM 1 \l 14398 Par
ailleurs, et pourtant, nous l'avons indiqué à plusieurs reprises ‑‑
et peut‑être que Pierre pourra intervenir à cet égard, puisque Pierre
était présent au sein du Conseil, du Fonds canadien‑‑
LISTNUM 1 \l 14399 Et
en toute déférence à l'égard des institutions, en toute logique également, nous
avons, depuis nombreux mois et années, tenté de convaincre les administrateurs
et le Conseil de cette réalité incontournable qu'a été le développement
technologique en matière de paysage audiovisuel canadien.
LISTNUM 1 \l 14400 Pierre?
LISTNUM 1 \l 14401 M.
LAMPRON: Oui, effectivement. Et on est beaucoup intervenu sur, justement, ces
questions de gouvernance et de gestion de conflits d'intérêts pour essayer de
démontrer que le résultat net du type de fonctionnement amène les groupes et
leurs intérêts corporatifs à beaucoup intervenir pour tenter de maintenir ce
qu'ils peuvent appeler les acquis, de continuer à bénéficier des protections
que le système a mises en place, année après année, pour pouvoir, justement,
leur donner le confort de protéger tantôt des rémunérations, tantôt des volumes
de production, tantôt donc, des accès à des enveloppes de production protégées.
LISTNUM 1 \l 14402 Et
dans la tentative d'explication qu'on peut avoir des objections qui peuvent
être entendues ‑‑ nous, on a entendu qu'effectivement, la
plupart des intervenants salivent à l'idée de la perspective qu'il y ait des
investissements nouveaux, mais sont beaucoup, beaucoup pris dans la situation
de se poser la question si tout ce qu'ils bénéficient comme protection serait
remis en cause par la capacité de négocier selon des règles de marché tout à
fait normales.
LISTNUM 1 \l 14403 Et
sur cette question, donc, de gouvernance, sur laquelle on était intervenu,
effectivement, j'ai eu l'occasion d'en témoigner assez souvent.
LISTNUM 1 \l 14404 Le
système est ainsi organisé que d'abord, s'il s'agit d'un conseil
d'administration avec des représentations de groupes d'associations d'intérêts
corporatifs qui sont très impressionnantes, qui effectivement, se présentent
devant vous en disant : « Maintenez‑nous
à l'intérieur de son conseil parce que nous possédons l'expertise, parce que
nous sommes les gens qui connaissons et parce que nous pouvons effectivement
influencer correctement l'évolution de ce fonds. »
LISTNUM 1 \l 14405 L'objectif
du président du conseil est d'obtenir pour la définition des orientations, des
critères et de tout ce qui fait la vie du fonds et d'obtenir le consensus de
ces représentants‑là.
LISTNUM 1 \l 14406 Ces
gens‑là ne sont pas au conseil en raison de leur expertise
particulière. Ils sont au conseil en
raison de la représentativité qu'ils ont.
Ils sont tantôt mandatés de leur association de distributeurs, tantôt de
leur association de producteurs.
LISTNUM 1 \l 14407 Et
leur seul objectif à l'intérieur de ce conseil, c'est de représenter les
intérêts de leurs membres de façon générale, de telle manière que ‑‑
ce qu'on vous a fait entendre sur la perspective, par exemple, qu'il y a des
votes et des décisions qui sont prises, si vous voulez, par des systèmes
indépendants et contrecarrés par le fait que l'administration ‑‑
qui est très compétente, soit dit en passant ‑‑ que l'administration,
lorsqu'elle propose ou qu'elle fait ses analyses se butte à un conseil
d'administration d'experts représentants leurs différents secteurs.
LISTNUM 1 \l 14408 Et
on assiste à des marchandages, si vous voulez, sur les intérêts qu'ils peuvent
avoir pour diriger le fameux consensus qui vous a été décrit.
LISTNUM 1 \l 14409 Et
on a des exemples. Essayez d'imaginer,
Monsieur Morin, que par exemple, pendant un an et demi (à peu près, en tout
cas) de discussions où on a été au conseil...
LISTNUM 1 \l 14410 Essayez
de vous imaginer qu'il a été impossible de faire accepter la vidéo sur demande
comme étant un diffuseur (ce que reconnaît le CRTC), pour une raison simple
: c'est qu'il était impossible aux
membres de ce conseil d'accepter l'arrivée d'un nouveau venu qui aurait eu
accès à des fonds et qui donc aurait menacé en quelque sorte la capacité des
uns et des autres de pouvoir protéger leurs acquis.
LISTNUM 1 \l 14411 C'est
une situation qu'on a dénoncée. C'est
une situation qui perdure. Et dans les
recommandations qui peuvent venir, il est certain que la seule résultante de ce
type de conseil d'administration, c'est la protection des acquis, c'est la
protection du statu quo.
LISTNUM 1 \l 14412 Et
c'est pourquoi on affirme, dans notre intervention qu'il est impossible à ce
fonds de pouvoir s'adapter à la nouvelle réalité qui a été amplement décrite et
que je pense que le Conseil a ‑‑
LISTNUM 1 \l 14413 M.
PÉLADEAU: Permettez‑moi, Monsieur Morin, juste ‑‑
rapidement, aussi.
LISTNUM 1 \l 14414 Donc,
alors que la vidéo sur demande existe depuis plus de trois ans, alors qu'elle
s'impose dans un univers occidental de façon accélérée, j'ai eu l'occasion
donc, de vous indiquer que près d'un million de visionnements ont eu lieu par
semaine.
LISTNUM 1 \l 14415 Donc,
sur une base annuelle, ça fait 52 millions.
Et ça, alors qu'environ seulement 50 pour cent ou un peu moins de nos
clients chez Vidéotron ont accès à la télévision numérique, aujourd'hui. Le reste du 50 pour cent étant encore en
télévision analogique qui ne permet pas cette technologie‑là.
LISTNUM 1 \l 14416 Vous
savez évidemment aussi qu'aux États‑Unis on va abolir l'analogique. Et on sait que le CRTC a proposé des règles à
cet égard‑là, différentes du marché américain. Mais c'est certain que la tendance au numérique
va se poursuivre et non diminuer ou freiner.
Et donc, en conséquence, ces nouvelles plates‑formes et ces
nouvelles technologies vont s'imposer encore davantage.
LISTNUM 1 \l 14417 On
peut penser aussi à l'Internet. Et le
conflit, à l'heure actuelle, qui existe aux États‑Unis entre les
scénaristes et puis les réseaux est un peu, justement, basé sur la monétisation
de ce nouveau canal de distribution que représente l'Internet.
LISTNUM 1 \l 14418 De
plus en plus, les réseaux, afin de combler la diminution des audiences qui
existent, qui sont une réalité, fait appel à l'Internet pour justement
compenser ce qu'ils ont perdu de l'autre côté.
Et on remarque également, en ce qui nous concerne, des tendances
similaires.
LISTNUM 1 \l 14419 J'aimerais
demander à Pierre, qui lui, a une présence Internet importante, autant au
niveau de l'information que de la dramatique...
LISTNUM 1 \l 14420 Peut‑être
que tu peux nous donner des chiffres, Pierre?
LISTNUM 1 \l 14421 M.
DION: Effectivement, j'ai des chiffres récents (à vrai dire du mois de janvier
de 2008) sur notre station, notre chaîne spécialisée LCN. Juste au mois de janvier, il y a eu 19
millions de pages vues sur le site de LCN, dont 2.5 millions de téléchargement
de « streaming » de clips comme tels.
LISTNUM 1 \l 14422 Juste
pour vous donner un exemple, c'est le double de trafic au mois de janvier, par
rapport à voilà six mois. Donc, il y a
une expansion absolument incroyable. Et
il faut comprendre qu'un réseau comme nous, on ne peut plus approcher les
investissements et notre stratégie de programmation ‑‑ et si
je donne un exemple au niveau de l'information (mais je pourrais dire la même
chose au niveau de tout autre genre de programmation à TVA), on ne peut plus
regarder notre investissement en regardant seulement un canal de diffusion.
LISTNUM 1 \l 14423 On
est condamné, finalement à vivre ‑‑ à soit subir la
fragmentation ou être en avant de la vague de cette fragmentation‑là. Et stratégiquement, se dire comment,
justement, on peut avoir un retour sur notre investissement dans la structure
de financement de notre émission, dans la stratégie d'exploitation de cette
ouvre‑là ou de cette émission‑là, pour être capable, justement, de
faire face à la réalité que Pierre‑Karl a parlé.
LISTNUM 1 \l 14424 Et
c'est pour ça que dans le discours de Pierre‑Karl on parle énormément des
nouveaux canaux de distribution, parce que ça doit être à la base de la
stratégie, surtout dans un marché francophone où on est dans un marché captif,
on est dans un marché de petite taille et on doit investir beaucoup pour avoir
justement ‑‑ pour attirer l'attention des téléspectateurs.
LISTNUM 1 \l 14425 Mais
les lois du marché et la réglementation actuelle ne nous permettent pas,
justement, d'exploiter à la mesure qu'on a besoin pour le Québec, pour concurrencer
à l'intérieur du Québec, mais aussi internationalement, aujourd'hui.
LISTNUM 1 \l 14426 CONSEILLER
MORIN: Maintenant, pour revenir au fonds... au fonds de plus de 100 millions
que vous proposez sur trois ans. Est‑ce
que ce sera toujours « des pommes » dans le sens suivant : est‑ce que ce seront des émissions de
type prioritaire, telles que celles qui sont financées par le Fonds canadien
qui apparaîtront à votre écran?
LISTNUM 1 \l 14427 Est‑ce
que les Québécois y perdront au change, en termes de qualité? Quelles garanties vous offrez, dans la
composition de ce 100 millions‑là, que ce soit des dramatiques, des
émissions pour enfants, et cetera?
LISTNUM 1 \l 14428 M.
PÉLADEAU: Monsieur Morin, évidemment, on est (puisque au cour de la
programmation) tout à fait conscients des besoins, je dirais, de la clientèle,
des auditeurs et des auditrices en matière de programmation canadienne,
particulièrement francophone.
LISTNUM 1 \l 14429 Dans
le passé, nous avons eu énormément de succès sur ce qu'on a appelé « les séries
lourdes ». L'environnement actuel, pour
les raisons que nous avons indiquées, ne nous permet plus de pouvoir en faire
et on considère que c'est une perte pour le paysage audiovisuel canadien. Quand on regarde des ouvres comme « Nos étés
», « Le négociateur »...
LISTNUM 1 \l 14430 CONSEILLER
MORIN: Est‑ce que c'est vrai que « Nos étés », ça serait la dernière?
LISTNUM 1 \l 14431 M.
PÉLADEAU: C'est la dernière. On n'a plus
les moyens de financer de telles productions.
Donc on va devoir revoir la façon dont on devra faire face à nos
obligations en matière d'heures prioritaires.
LISTNUM 1 \l 14432 Et
c'est indéniable, lorsque TVA va revenir devant vous pour son renouvellement de
licence, va demander des aménagements en ce qui concerne ses obligations puisque
c'est sa rentabilité et sa viabilité, sa pérennité qui, à terme, est menacée.
LISTNUM 1 \l 14433 Et
on l'a constaté, je ne pense pas qu'il y a une exception en ce qui concerne
TVA. L'ensemble des télévisions
généralistes, qu'elles soient anglophones ou francophones subissent des
pressions liées, donc, à ces évolutions technologiques.
LISTNUM 1 \l 14434 La
perspective qui s'offre à nous, dans notre projet « d'opting out », c'est
justement de s'assurer qu'on va pouvoir maintenir des niveaux de qualité, de
pouvoir faire de la dramatique, de pouvoir également faire des variétés de
qualité, à partir par ailleurs d'une structure d'exploitation qui va nous
permettre, justement, à partir du fait que nous sommes détenteurs des droits,
de l'exploiter sur plusieurs canaux de distribution.
LISTNUM 1 \l 14435 Ce
que nous avons perdu à l'antenne, nous allons le retrouver sur les autres
canaux de distribution et monétiser cette capacité de pouvoir, donc, offrir du
contenu de qualité et, à ce moment‑là, le financer par ces nouveaux
canaux de distribution.
LISTNUM 1 \l 14436 Mais
globalement, est‑ce que le 100 millions, par exemple, équivaudrait à ce
que vous auriez obtenu, le 30 millions que vous auriez obtenu, disons, ou le 50
millions que vous auriez obtenu du Fonds canadien, en termes de qualité? Autrement dit, actuellement, selon ce qu'on
peut voir au cours des dernières années, c'est grosso modo 16 à 18 millions que
vous allez chercher du Fonds canadien de télévision, donc, c'est là que vient
le premier chiffre de 50 millions sur trois ans.
LISTNUM 1 \l 14437 Ce
que vous nous proposez, c'est un 100 millions à 33 millions par année. Est‑ce que ce 33 millions par année
pourrait, dans votre esprit, se qualifier pour l'obtention des sommes
disponibles au Fonds canadien?
LISTNUM 1 \l 14438 M.
DION: Peut‑être que je pourrais répondre en disant deux choses.
LISTNUM 1 \l 14439 Un
: On pourrait peut‑être
faire ‑‑ pas peut‑être ‑‑ on pourrait
faire des choses qu'on ne peut plus faire aujourd'hui. Pourquoi?
Parce que comme on a expliqué, tout le système d'exploitation de cette
ouvre‑là serait différent. Et
c'est pour ça que dans les règles actuelles, on ne peut plus faire « Un homme
mort » qu'on a cancellé, ou « Vice caché » ou maintenant « Le négociateur » et
« Nos étés » qui, en passant ‑‑ les séries qui vont être
diffusées cet hiver sont également déficitaires.
LISTNUM 1 \l 14440 Donc,
dans un nouveau modèle, le nouveau modèle proposé du fonds Quebecor, on
pourrait sûrement revenir dans certains types de contenus qu'on ne peut plus
avec le modèle actuel, justement à cause de l'exploitation qu'on va en faire.
LISTNUM 1 \l 14441 Deuxièmement
: 15 millions du 16 millions qu'on
reçoit aujourd'hui, TVA, c'est de la dramatique. Donc, c'est ‑‑ dans un
nouveau contexte du fonds Quebecor, on voudrait élargir les possibilités du
type d'émissions qu'on pourrait faire à l'intérieur du fonds proposé, qui je
pense serait un atout incroyable.
LISTNUM 1 \l 14442 Je
vais juste vous donner un exemple. On
est à créer une variété, présentement qui va être en ondes en septembre à
TVA. Cette variété‑là, à l'heure
actuelle, n'est pas admissible au Fonds canadien et même si elle était
admissible, le Fonds canadien ne permet pas à TVA d'utiliser plus qu'un million
du 16 millions de dollars pour de la production, de la création et de la
production internes.
LISTNUM 1 \l 14443 A
l'intérieur du fonds Quebecor, ce ‑‑ appelons‑le ce
format‑là de variété qu'on veut créer utiliserait toutes les plateformes
de diffusion, aurait probablement une injection d'argent assez intéressante
pour pouvoir en créer, en faire un format, et avoir un véritable potentiel,
justement d'exploiter à l'international ce format‑là, comme les Endemol
et les Freemantle de ce monde on fait au cours des dernières années.
LISTNUM 1 \l 14444 Donc,
je pense qu'on a un exemple concret de ce qu'on pourrait faire à l'intérieur du
nouveau fonds.
LISTNUM 1 \l 14445 CONSEILLER
MORIN: Bien, prenons l'exemple des dramatiques.
Est‑ce que sur l'angle des dramatiques, ce fonds‑là pourrait
générer plus de dramatiques qu'on en génère actuellement dans le cadre du Fonds
canadien de télévision?
LISTNUM 1 \l 14446 Est‑ce
que c'est votre objectif, puisque les règles ne fonctionnent plus,
actuellement?
LISTNUM 1 \l 14447 M.
LAVOIE: Mais Monsieur Morin, je voudrais
juste (et je vais repasser la parole à Pierre) souligner une chose. Je ne vois pas quelle serait notre motivation
à abaisser le niveau de qualité de nos productions. Je n'en vois vraiment pas.
LISTNUM 1 \l 14448 Il
n'y a pas de raison qui nous amènerait à offrir une programmation de moins
bonne qualité. On est le leader, en
télévision au Québec, parce qu'on fait de la qualité. Et il n'est pas question de baisser le niveau
de qualité. Ce qu'on veut, c'est sortir
de la camisole de force qui définit ce qu'on doit puis comment on doit le
faire, puis en vertu de quelles règles et en vertu de ceci et en vertu de cela.
LISTNUM 1 \l 14449 On
veut libérer les Fonds, on veut faire en sorte que les fonds aillent
directement à l'écran, pas dans l'administration d'une bureaucratie. On veut faire affaire avec des producteurs
indépendants, parce qu'on n'a pas le choix, on doit faire affaire avec des
producteurs indépendants.
LISTNUM 1 \l 14450 Parce
que même sans les règles du CRTC, il ne serait pas possible, physiquement,
logistiquement et autrement, de tout produire à l'interne. On veut le faire sur une base commerciale
plus appropriée et correspondant mieux aux pratiques commerciales et aux
pratiques de gestion les plus élémentaires.
LISTNUM 1 \l 14451 Mais
abaisser la qualité, il n'en est évidemment pas question. Ça serait suicidaire de faire ça.
LISTNUM 1 \l 14452 Pierre?
LISTNUM 1 \l 14453 M.
DION: tu as absolument raison, Luc. Puis
juste quelques chiffres pour témoigner de ça :
90 pour cent en 2006‑2007, année broadcast TVA, 90 pour cent de
notre budget total de programmation est du contenu canadien. Ça fait que je vous laisse imaginer le
pourcentage en « prime time ».
LISTNUM 1 \l 14454 C'est
le cour de notre business. Seulement 10
pour cent de nos investissements, c'est en contenu étranger. Donc nous, c'est ce que les Québécois et
Québécoises désirent. Et c'est
effectivement notre priorité.
LISTNUM 1 \l 14455 CONSEILLER
MORIN: Vous venez de parler, faire allusion aux producteurs indépendants. Évidemment, dans le cadre des règles actuelles,
vous êtes obligés d'y recourir. Et vous
parlez d'une contribution notable, si j'ai bien lu dans votre mémoire.
LISTNUM 1 \l 14456 Ça
serait quoi la « contribution notable »?
Parce qu'à ce moment‑là, vous seriez libéré de l'obligation de
faire appel aux producteurs indépendants.
Donc, la production maison pourrait représenter quoi, par rapport aux
producteurs indépendants dans votre fonds de 100 millions répartis sur trois
ans?
LISTNUM 1 \l 14457 M.
LAVOIE: D'abord, je voudrais ‑‑juste pour préciser une chose,
Monsieur Morin, je ne pense pas qu'on serait libérés de notre obligation de
faire appel à des producteurs indépendants parce que c'est dans la loi elle‑même,
au‑delà de la réglementation et de la décision de '94 qui donnait
naissance au Fonds canadien (qui s'appelait à l'époque le Fonds des câblos).
LISTNUM 1 \l 14458 On
a quand même une obligation de faire affaire avec des producteurs
indépendants. Mais laissons l'obligation
de côté. On va devoir faire affaires
avec des producteurs indépendants, simplement parce qu'on a besoin, en appui,
de la production indépendante.
LISTNUM 1 \l 14459 On
en a aussi besoin, pas seulement en appui, mais en créativité. On ne va...
Pourquoi on ne ferait aux esprits les plus créatifs qui sont disponibles
sur le marché. C'est à notre avantage de le faire. Maintenant, quel est le pourcentage qui va
aller en production indépendante?
J'aurais tendance à penser « Est‑ce qu'on l'a quantifié? » Puis là, j'aurais tendance à penser qu'il va
être à peu près équivalent à ce qu'il est maintenant.
LISTNUM 1 \l 14460 CONSEILLER
MORIN: Et donc, l'augmentation du contenu canadien se traduirait par une
augmentation équivalente de votre production interne et d'une augmentation
équivalent au niveau des producteurs indépendants. Est‑ce que je comprends bien?
LISTNUM 1 \l 14461 M.
LAVOIE: On ne l'a pas quantifié, mais je pense que c'est à peu près exact, de
penser comme ça, oui.
LISTNUM 1 \l 14462 Sauf
que les contraintes qui disent : « Ceci
peut être fait comme cela par untel et par l'autre. » Non, on aurait des pratiques commerciales,
qui vont dans l'intérêt, au fond, des consommateurs. De nos actionnaires, mais aussi des
consommateurs. Parce que ce qu'on veut
offrir, c'est un produit de qualité, puis on veut en offrir davantage.
LISTNUM 1 \l 14463 CONSEILLER
MORIN: Vous dites que ‑‑
LISTNUM 1 \l 14464 M.
LAMPRON: Pardon? Dans le modèle qu'on
vous a proposé, on propose effectivement de libérer un peu la nature des
négociations y compris avec les producteurs indépendants.
LISTNUM 1 \l 14465 Mais
on a également, au conseil, des représentants des membres du CRTC. Et c'est beaucoup cette situation d'indiquer
que sans avoir nécessairement à fonctionner à partir, si vous voulez, de quotas
ou d'obligations qui sont particulières, il y a la capacité pour le système
d'observer notre bonne pratique.
LISTNUM 1 \l 14466 Ce
que nous affirmons et ce que nous répétons, c'est que notre intérêt, notre
intérêt premier, c'est de recourir, je dirais massivement à la production
indépendante parce que c'est elle qui nous génère les idées qui nous sont
nécessaires.
LISTNUM 1 \l 14467 M.
TRÉPANIER: Cela dit, si vous permettez, Monsieur Morin, on ne voudrait pas
faire le renouvellement de licence aujourd'hui.
Mais à l'heure actuelle, il y a une attente que 75 pour cent des
émissions prioritaires aillent à la production indépendante.
LISTNUM 1 \l 14468 Et
on vient, je pense, de vous le démontrer et les chiffres sont là aussi pour le
démontrer. Les règles du marché sont
entièrement suffisantes pour qu'une entreprise comme la nôtre travaille avec la
production indépendante. Alors, il ne
serait peut être pas surprenant qu'à l'automne on vous propose de remplacer les
quotas par les règles du marché.
LISTNUM 1 \l 14469 CONSEILLER
MORIN: Vous avez dit, je pense, pour la dernière année, finalement, que vous
allez chercher plus dans le système au niveau du Fonds canadien de la
télévision que Vidéotron n'en verse au système.
Donc, que vous êtes, dans le fond ‑‑ que vous soutirez
plus d'argent, malgré toutes les règles, que Vidéotron envoie, si vous voulez,
au Fonds canadien.
LISTNUM 1 \l 14470 Donc,
vous libéreriez le Fonds canadien de montants, finalement, si je comprends
bien?
LISTNUM 1 \l 14471 M.
LAVOIE: Un million de dollars, précisément.
LISTNUM 1 \l 14472 CONSEILLER
MORIN: Un million...
LISTNUM 1 \l 14473 Est‑ce
que sur les cinq dernières années, c'était aussi vrai?
LISTNUM 1 \l 14474 M.
LAVOIE: C'est à peu près constant.
LISTNUM 1 \l 14475 CONSEILLER
MORIN: Autrement, est‑ce que
chaque année, bon an, mal an, c'est...?
LISTNUM 1 \l 14476 M.
LAVOIE: C'est à peu près constant, à peu
de choses près, oui.
LISTNUM 1 \l 14477 M.
TRÉPANIER: Je dirais que la tendance est d'augmenter la contribution au Fonds
canadien de Vidéotron, à cause du succès des initiatives de cette entreprise‑là
et que, si on regarde l'enveloppe ‑‑
LISTNUM 1 \l 14478 Et
là, je ne suis pas dans mon domaine d'expertise, mais l'enveloppe semble
diminuer. Alors, le million dont
monsieur Lavoie parle pourrait, évidemment, croître.
LISTNUM 1 \l 14479 CONSEILLER
ARPIN: Je me permets d'intervenir, pour
mettre les vrais chiffres sur la table.
Parce que c'est un débat qui effectivement tourne autour de l'argent.
LISTNUM 1 \l 14480 Le
groupe TVA, en 2006‑2007, a retiré 18.4 millions du Fonds canadien de
télévision. Et en 2007‑2008, comme
ça a été dit, a eu une diminution appréciable de deux millions, en fait, pour
retirer 16.4 millions. Les contributions
de Vidéotron, cependant, pendant la même période : en 2006 ‑‑ pour la période
2005‑2006, Vidéotron a contribué 15.1 millions et pour la période 2006‑2007,
a contribué 16.8 millions.
LISTNUM 1 \l 14481 Alors
les chiffres que ‑‑ parce que vous utilisez des chiffres ‑‑ Quand ça fait votre affaire, des chiffres de
2006, quand ça fait votre affaire, vous utilisez des chiffres de 2007. Monsieur Dion parlait de chiffres de 2007,
parce qu'ils sont plus bas, puis monsieur Péladeau parle avec des chiffres de
2006, parce qu'ils sont plus bas que les chiffres de 2007.
LISTNUM 1 \l 14482 Je
voulais seulement remettre ça pour qu'on ait une discussion en utilisant les
bases de données qui sont les bases qui permettent à tout le monde de comparer.
LISTNUM 1 \l 14483 M.
LAMPRON: Si vous me permettez quand
même, sur cette question‑là, les faits sont les faits. Et les interprétations sont les
interprétations. Notre intention n'était
pas d'induire en erreur et non plus de jouer sur des chiffres. Simplement, si vous avez bien lu notre texte,
on fait toujours référence à ce qui avait déjà été déposé, et c'était l'année
de référence.
LISTNUM 1 \l 14484 Et
je pense que nos chiffres sont exactement ceux que vous avez indiqués.
LISTNUM 1 \l 14485 M.
DION: Peut‑être juste un dernier commentaire, Monsieur Arpin,
effectivement, on a les mêmes chiffres, mais à vrai dire, sur les chiffres que
vous venez de donner et pour répondre à la question, avec une enveloppe de
18.4, ça libère encore plus...
LISTNUM 1 \l 14486 CONSEILLER
ARPIN: Oui.
LISTNUM 1 \l 14487 M.
DION: Hein? Ça libère encore plus le Fonds canadien du
montant envers TVA.
LISTNUM 1 \l 14488 Donc,
au lieu d'être le million que Luc Lavoie parlait, c'était deux millions. Et même, voilà deux ans, ça aurait été trois
millions. On a eu une baisse de deux
millions cette année qu'on ne comprend pas.
Donc, ça aurait été encore plus important, la libération auprès du Fonds
canadien.
LISTNUM 1 \l 14489 M.
LAMPRON: Soyez assuré, Monsieur le vice‑président, qu'on n'a jamais voulu
induire le Conseil en erreur.
LISTNUM 1 \l 14490 CONSEILLER
ARPIN: Non. Mais cependant, c'est qu'on
constate ‑‑ puis malheureusement, je comprends très bien la problématique
à laquelle fait référence Pierre Dion.
LISTNUM 1 \l 14491 Puis
les données sur plusieurs années montrent qu'effectivement, une problématique
de la télévision hertzienne de langue française qui est assez complexe et pour
laquelle je n'ai pas encore trouvé d'explication, mais où l'ensemble des jours
qui diffusent et qui accèdent au Fonds, autres que Radio‑Canada, ont tous
vu des diminutions appréciables de leur enveloppe (je parle des hertziens, je
ne parle pas des spécialisés) malgré que le Fonds, a lui‑même crut,
pendant cette période‑là.
LISTNUM 1 \l 14492 Cependant,
il faut noter aussi que la bonne performance de Vidéotron fait en sorte
qu'elle ‑‑ aujourd'hui, Vidéotron contribue de plus en plus au
Fonds et devrait normalement (je suis sûr que corporativement, Quebecor a des
attentes à ce que Vidéotron continue sa croissance)... donc que les sommes que
Vidéotron est appelé à contribuer au Fonds, vont être en croissance au cours
des prochaines années.
LISTNUM 1 \l 14493 Alors
que dans le cas de Groupe TVA, pour l'instant, je n'ai pas ‑‑
il me manque d'éclairage en tout cas pour savoir dans quelle direction s'en va
les contributions du Fonds.
LISTNUM 1 \l 14494 M.
PÉLADEAU: Vous avez raison, monsieur le vice‑président de souligner la
volonté de Quebecor Média; de poursuivre le succès, c'est la règle à laquelle
on s'assujettit de façon quotidienne.
LISTNUM 1 \l 14495 Donc,
le succès de l'entreprise, vous l'avez souligné avec Vidéotron, on espère
poursuivre, dans les années qui viennent, avec des services supplémentaires. Comme vous le savez, Vidéotron a évolué de
façon significative depuis un certain nombre d'années, dans un environnement
monopolistique d'ailleurs, qui était celui qui existait au moment de la création
du Fonds des câblos et qui a été également mis en valeur par monsieur Stein, un
peu plus tôt.
LISTNUM 1 \l 14496 On
fait face aujourd'hui à un environnement extrêmement concurrentiel. Et c'est les citoyens qui ont bénéficié de
tous ces services. Et on espère bien
pouvoir poursuivre dans cette veine‑là.
LISTNUM 1 \l 14497 Ceci
étant, pour insister sur votre argument, c'est qu'on répète que la contribution
de Quebecor va doubler. Ça m'étonnerait
que Vidéotron ‑‑ ou on l'espère (rire).
LISTNUM 1 \l 14498 Tu
sais, je ne passerai pas de 1.5 millions de clients à trois millions en
câblodistribution aussi rapidement que dans une période de trois ans, tel qu'on
vient de la proposer.
LISTNUM 1 \l 14499 CONSEILLER
ARPIN: Je laisse mon collègue, monsieur Morin, poursuivre.
LISTNUM 1 \l 14500 CONSEILLER
MORIN: Si on devait ‑‑ si le Conseil vous donnait son aval
pour la création d'un fonds, est‑ce que vous seriez d'accord pour une
période d'essai de trois ans avec une possibilité, ou en tout cas une date
butoir, qu'à la fin de la deuxième année, on déciderait ou pas de prolonger
l'aventure?
LISTNUM 1 \l 14501 M.
PÉLADEAU: Nous sommes ouverts à toutes les suggestions que le Conseil est prêt
à discuter avec nous. On va être d'une
ouverture d'esprit indéniable parce qu'on considère, encore une fois, que faire
évoluer le paysage audiovisuel canadien est d'une importance capitale pour la
collectivité et également pour notre entreprise.
LISTNUM 1 \l 14502 Tout
à l'heure, vous posiez la question ‑‑ laissez‑moi peut‑être
éventuellement, aussi, donner une illustration qui s'est avérée être une grande
perte pour une industrie qui, puis particulièrement également au Québec, a
fait ‑‑ et elle est encore importante : le domaine de la musique.
LISTNUM 1 \l 14503 Les
artistes n'ont pas vu le développement d'Internet venir. Et aujourd'hui, on constate que cette
industrie‑là est en déclin marqué.
Et cette technologie qui existait, n'a pas été en mesure de freiner les
élans de conservatisme de cette industrie.
LISTNUM 1 \l 14504 On
voudrait s'assurer que justement, dans
le domaine de la télévision, on puisse avoir des règles adaptées pour s'assurer
de la viabilité de cette infrastructure que la collectivité a créée depuis de
nombreuses années.
LISTNUM 1 \l 14505 Et
si on vit avec des règles qui sont inadaptées, qui sont liées à un environnement
où la technologie n'existait pas, je pense qu'on fait fausse route. Et comme on dit en anglais : « At the end of the day... » ça va être
l'industrie qui va en souffrir.
LISTNUM 1 \l 14506 Donc,
très ouverts à une période d'essai; très ouverts à maintenir le dialogue
extrêmement serré avec la commission pour s'assurer que l'ensemble des
participants de l'industrie vont
rencontrer les objectifs de la Loi sur la radiodiffusion, qui est de
stimuler et de maintenir une programmation canadienne de qualité.
LISTNUM 1 \l 14507 CONSEILLER
MORIN: Vous comprendrez que votre proposition, c'est une sorte de coup de
tonnerre dans le paysage audiovisuel canadien.
Ce matin, on avait le groupe Shaw.
Et lorsqu'on a posé la question :
« Est‑ce que vous avez quelque chose à proposer? » Bien, il n'en avaient pas « quelque chose à
proposer. » Ils n'avaient rien
d'équivalent à ce que vous, vous proposez.
LISTNUM 1 \l 14508 Si ‑‑
je dis toujours « dans l'hypothèse » où le Conseil dirait oui à votre
proposition, de doubler votre contribution, et cetera, il est certain que
d'autres, peut‑être...
LISTNUM 1 \l 14509 Ce
n'est pas le cas pour l'instant, personne ne propose quelque chose
d'équivalent. Mais il se peut que dans
un avenir plus ou moins rapproché, d'autres entreprises pourraient peut‑être
suggérer un « opting out » comme le vôtre, comme celui que vous proposez.
LISTNUM 1 \l 14510 Dans
ce sens‑là, est‑ce qu'il y a un certain nombre de règles que vous
pourriez élaborer, que vous pourriez suggérer, vous avez jusqu'au 18 février
pour y répondre, qui pourraient aider le Conseil à encadrer, à baliser «
l'opting out »?
LISTNUM 1 \l 14511 Je
pense par exemple, ça pourrait être vous dites : « On va aller chercher des résultats
d'écoute, on va produire davantage, on s'engage véritablement. » Bien, je vous donne un exemple. Est‑ce qu'on ne devrait pas appliquer
la même règle : On double ce qui est prévu au cours des trois prochaines
années?
LISTNUM 1 \l 14512 C'est
toujours un essai de ‑‑ vous venez de dire oui ‑‑
c'est toujours un essai de trois ans avec date butoir pour le renouvellement au
bout de 24 mois. Évidemment, ça, ça va
un peu sous le sens, c'est de la production « HD ».
LISTNUM 1 \l 14513 Et
les résultats d'écoute sont là. Est‑ce
qu'il y a un certain nombre de règles que vous pourriez proposer? Peut‑être vous pourriez nous en donner
un avant‑goût ce matin, qui pourraient baliser « l'opting out » du Fonds
canadien de télévision?
LISTNUM 1 \l 14514 M.
LAVOIE: Oui. La réponse est oui. Vous nous donnez une date, qui est le 18 février
où on peut vous répondre avec beaucoup plus de détails, mais je me contenterai
de vous dire que le concept de départ qu'on propose c'est : « L'opting out » s'accompagne d'une
augmentation très substantielle de la contribution à la programmation canadienne. Édouard?
LISTNUM 1 \l 14515 M.
TRÉPANIER: J'allais simplement dire que oui, effectivement, pour la phase de
réplique, nous ‑‑
LISTNUM 1 \l 14516 CONSEILLER
MORIN: Autrement dit, vous pourriez fixer la barre vous‑même. Et ce serait à nous de dire oui ou non, mais
vous pourriez fixer la barre vous‑même :
Voici, selon nous, des règles qui pourraient être applicables et qui
pourraient être présentées par option à d'autres joueurs de l'industrie.
LISTNUM 1 \l 14517 M.
LAVOIE: Monsieur Morin, sans aller jusqu'à des règles précises, on peut
certainement vous donner un cadre conceptuel de ce qu'on considère être une
base équitable pour créer et pour permettre « opting out », je crois.
LISTNUM 1 \l 14518 CONSEILLER
MORIN: Merci, beaucoup.
LISTNUM 1 \l 14519 CONSEILLER
ARPIN: Merci, Madame la présidente. J'ai
plusieurs questions dans plusieurs domaines, mais ma première... et je vais
commencer à partir de votre présentation orale de monsieur Péladeau.
LISTNUM 1 \l 14520 Puis
je vais aller au paragraphe 5, je crois, qu'il y a une coquille, vous avez dit
2007, mais ça devrait être 2006 ‑‑pour les fins du dossier,
pour que les gens...
LISTNUM 1 \l 14521 Parce
que vous avez dit :
« We have produced, since our
decision on January 23, 2007 to suspend payment... »
LISTNUM
1 \l 14522 But
in fact, it was January 23rd ‑‑ Oh! 2007! Pardon me, you we right. I was thinking Decemb‑‑ I was
confused with the previous ‑‑
LISTNUM 1 \l 14523 M.
PÉLADEAU: Mais monsieur les collaborateurs qui sont chanceux parce qu'ils
auraient été virer...
‑‑‑ Laughter /
Rires
LISTNUM 1 \l 14524 M.
LAMPRON: Mais il y avait... Monsieur le
vice‑président, il n'y avait pas de mauvaise intention de votre
part? Oh! Non!
‑‑‑ Laughter /
Rires
LISTNUM 1 \l 14525 CONSEILLER
ARPIN: Non, mais tu sais, je veux dire, il y avait ‑‑ C'est moi qui confondais la date du démarrage
du processus avec de Shaw, qui était en décembre 2006. C'est MA confusion, donc : ça m'apprendra de vouloir être pointilleux
par moment.
‑‑‑ Laughter /
Rires
LISTNUM 1 \l 14526 CONSEILLER
ARPIN: Je vais aller ‑‑
On parle de « l'opting out » et dans le sens de la discussion que vous venez
d'avoir avec monsieur Morin...
LISTNUM 1 \l 14527 Si
le Conseil acceptait votre option de retrait, tout en gelant les sommes au
niveau actuel de ce que TVA pourrait retirer, et donc, que l'excédent que
Vidéotron pourrait avoir à payer au cours des années, lui, soit versé au Fonds
canadien de télévision, qu'est‑ce que ‑‑ auriez‑vous
des commentaires à faire sur ce type de proposition?
LISTNUM 1 \l 14528 M.
PÉLADEAU: Bien, selon la logique mathématique à laquelle on a fait référence en
matière de financement, c'est un ‑‑ on doublerait, donc, les
montants liés à la production, la contribution à la programmation canadienne
qui serait réglementée, donc, par le fonds Quebecor.
LISTNUM 1 \l 14529 Donc,
dans cet esprit‑là, il n'y aurait certainement pas de surplus éventuels
que Vidéotron serait appelée à payer dans le cadre actuel de la
réglementation. Donc, ça revient un
petit peu à ce que je disais tout à l'heure.
Ça serait fort étonnant qu'on double le nombre de client au niveau de la
câblodistribution.
LISTNUM 1 \l 14530 CONSEILLER
ARPIN: Mais pour arriver à 100 millions sur trois ans... en fait, vous dites 16
millions et demi, ça fait 33, trois ans ça fait, en arrondissant... on arrive à
100 millions.
LISTNUM 1 \l 14531 Maintenant,
les contributions (comme je vous l'ai dit) de Vidéotron sont en croissance sur
une base annuelle. Et quand même une
croissance intéressante de 1 600 000.
Si ‑‑ ce 1 600 000 supplémentaire de... est‑ce
que lui aussi serait doublé dans ce cas‑là, selon votre scénario qui
finalement, à la fin, ça ne serait pas 100 millions, mais ça serait ‑‑ On s'approcherait peut‑être à 110
millions?
LISTNUM 1 \l 14532 M.
PÉLADEAU: La contribution actuelle est autour de 16 millions. On peut prévoir, effectivement, peut‑être,
une croissance, au niveau de notre clientèle.
LISTNUM 1 \l 14533 Malheureusement,
on a comme politique de ne pas donner de projection sur notre augmentation,
mais on constate quand même que pour l'exercice 2007, on a bénéficié, tel que
vous l'avez indiqué, d'une augmentation de notre clientèle au niveau de la
câblodistribution.
LISTNUM 1 \l 14534 CONSEILLER
ARPIN: D'une part, mais aussi une augmentation des tarifs.
LISTNUM 1 \l 14535 M.
PÉLADEAU: Exactement. C'est ce que
j'allais indiquer. Au niveau, donc, de
la télévision numérique, un client numérique génère davantage de revenus qu'un
client analogique. Il a davantage de
liberté et davantage, également, accès à des services qui n'existaient pas en
matière analogique.
LISTNUM 1 \l 14536 Et
on pense que c'est pour le bénéfice donc du citoyen d'être ainsi. Mais c'est certain que cette croissance‑là
ne pourra jamais s'approcher (et de loin) de cette contribution supplémentaire
qu'on veut proposer, c'est‑à‑dire un doublement de notre
contribution.
LISTNUM 1 \l 14537 Ça,
ça serait irréaliste de penser qu'on va pouvoir doubler les revenus en
distribution, que ce soit par le biais d'une augmentation de nos clients ou une
augmentation du revenu généré par client.
LISTNUM 1 \l 14538 M.
LAMPRON: Je me permets, sur cette question‑là, Monsieur Arpin, de vous
signaler que dans notre proposition on augmentait notre contribution à l'année
un. Et on propose justement de
l'augmenter de 20 pour cent par année pour tenir compte de ces phénomènes de
croissance que vous évoquez.
LISTNUM 1 \l 14539 CONSEILLER
ARPIN: Maintenant la contribution excédentaire, si je comprends bien, elle est
versée par Vidéotron. Elle n'est
pas ‑‑ Ce n'est pas pris à même les budgets d'opération de TVA
ou en provenance de Quebecor Média, elle?
LISTNUM 1 \l 14540 M.
PÉLADEAU: Éventuellement...
LISTNUM 1 \l 14541 CONSEILLER
ARPIN: Ça vient de Quebecor Média, oui, mais...
LISTNUM 1 \l 14542 M.
PÉLADEAU: Bien c'est ça. Éventuellement,
Monsieur le vice‑président, on déterminera les modalités avec vous
ou ‑‑ Mais c'est certain que ça fait partie quand même d'un
ensemble corporatif, là. Quebecor... TVA
est une entité publique, comme vous le savez, une entreprise qui a elle‑même,
donc, vocation de ‑‑ est publique. Elle a un conseil d'administration.
LISTNUM 1 \l 14543 D'ailleurs
comme vous le savez, ses conditions de licence exigent que les administrateurs
soient, de façon majoritaire, indépendants.
Elle va demeurer publique (en tout cas certainement jusqu'à la semaine
prochaine) et elle a ses propres actionnaires, ses propres créanciers, ses
propres employés.
LISTNUM 1 \l 14544 Ensuite,
elle est une filiale de Quebecor Média.
Vidéotron est une filiale, elle, également de Quebecor Média à 100 pour
cent. Donc, on déterminera quelles vont
être les modalités de part et d'autre, de ce qui semble être quand même une
réalité corporative à laquelle on doit travailler dans un environnement aussi
de ce qu'on appelle de gouvernance d'entreprise.
LISTNUM 1 \l 14545 M.
LAMPRON: Et dans ‑‑ encore une fois, je m'excuse. Mais dans la proposition que nous vous avions
acheminée et qui sont dans les documents qui y sont déposés ‑‑
et puis on ne l'a pas remis à l'intérieur du paragraphe, mais je vous rappelle
qu'il y avait également l'engagement que TVA maintiendrait de son niveau, ses
contributions à la programmation tel qu'historiquement ça a été observé.
LISTNUM 1 \l 14546 Ce
qui veut dire que ‑‑ se servira pas de ce fonds pour que TVA
ne joue pas son rôle de diffuseur.
LISTNUM 1 \l 14547 CONSEILLER
ARPIN: D'accord. Dans votre présentation
orale et puis dans une lettre que monsieur Dion faisait parvenir au Conseil (à
mon attention, au Conseil) en juin 2007 et qui fait partie du dossier que vous
avez déposé aujourd'hui, on traite des traits distincts du marché francophone.
LISTNUM 1 \l 14548 Et
dans votre présentation orale, vous vous attachez particulièrement au fait que,
finalement, l'indice de mesure du coût par mille fait en sorte que vous êtes 21
pour cent moins productif que le marché ontarien.
LISTNUM 1 \l 14549 Et
que finalement, ça a comme incidence que les investissements publicitaires au
Québec sont moins importants qu'ils le sont dans le marché ontarien. Et je crois que c'est aussi ‑‑
enfin, peut‑être pas en dollars totaux, mais en termes de dollar per
capita, c'est aussi vrai avec les provinces de l'Ouest canadien.
LISTNUM 1 \l 14550 Est‑ce
que vous ‑‑ je suis sûr que c'est une question sur laquelle
vous vous êtes penchés 100 fois ‑‑ Est‑ce que vous avez
trouvé une explication rationnelle?
LISTNUM 1 \l 14551 M.
LAVOIE: Des fois on aime mieux ne pas y penser.
‑‑‑ Laughter /
Rires
LISTNUM 1 \l 14552 M.
LAMPRON: On n'a pas tout à fait le même point de vue, aussi.
‑‑‑ Laughter /
Rires
LISTNUM 1 \l 14553 M.
PÉLADEAU: Sur la distinction du marché
francophone et du marché anglophone au niveau publicitaire, vous voulez dire?
LISTNUM 1 \l 14554 CONSEILLER
ARPIN: Oui, notamment.
LISTNUM 1 \l 14555 M.
LAVOIE: Il y a une différence de 21 pour cent.
LISTNUM 1 \l 14556 CONSEILLER
ARPIN: Parce que cet écart‑là ‑‑ Puis, je sais que cette
année, il y a aussi un écart et peut‑être pas de l'ordre de 21 pour cent,
mais il y a aussi un écart défavorable avec les provinces que sont l'Alberta et
la Colombie‑Britannique, pour avoir vu les données, dans le passé.
LISTNUM 1 \l 14557 M.
LAVOIE: J'imagine que ça a un peu à voir
avec la richesse relative des entités
que sont l'Ontario, le Québec et l'Ouest.
Ça ne répond pas à tout, mais ça a certainement un rôle à jouer.
LISTNUM 1 \l 14558 M.
LAMPRON: Dans nos consultations avec, justement, nos collègues qui font des
placements publicitaires et tout ça, on évoque effectivement tout un ensemble
de raisons.
LISTNUM 1 \l 14559 Il
y a des concentrations de populations, les niveaux de richesse, la
concentration, si voulez, de la prise de décisions davantage vers Toronto que
vers Montréal, une connaissance peut‑être moins importante du marché
francophone, de ses vedettes et de cette capacité à générer. Le fait qu'effectivement, on génère des
auditoires qui sont sans aucune commune mesure avec ce qui s'observe sur
l'ensemble nord‑américain.
LISTNUM 1 \l 14560 Donc,
plus de difficultés probablement pour eux de, je dirais, monétiser (pour
employer l'expression), ces choses‑là.
Donc, il y a toute une série d'ensemble de facteurs, puis je n'entrerai pas
dans la socio‑politique, mais il y a toute une série de facteurs de cette
nature qui nous sont évoqués.
LISTNUM 1 \l 14561 Le
fait brutal, c'est que malgré qu'on puisse ouvrir des bureaux à Toronto, qu'on
puisse intervenir ‑‑ et puis je pense qu'on a quelqu'un qui y
a travaillé puis qui est très compétent ‑‑ c'est que cet écart‑là,
il est constant et il fait en sorte que ce que nous avons décrit se produit.
LISTNUM 1 \l 14562 M.
DION: Oui, bien, effectivement, je pense que tout ce qui a été dit est très vrai. Et je rajouterais que la réalité aussi au
quotidien qu'on vit, c'est que tu as un marché où premièrement la télévision
d'État a une part de marché très très très importante comparativement au Canada
anglais.
LISTNUM 1 \l 14563 Et
naturellement, leur stratégie publicitaire, des revenus publicitaires, elle est
très différente de la nôtre. Donc, on a
cette réalité‑là. Il y a aussi un
joueur comme TQS dont vous connaissez la situation et aussi les chaînes
spécialisées qui ont un inventaire publicitaire beaucoup plus important
aujourd'hui.
LISTNUM 1 \l 14564 Donc,
on se ramasse dans un marché où il y a trop d'inventaire publicitaire avec un
joueur public d'État qui prend une grande part de marché et TVA se retrouve
justement dans une situation où le coût par mille est dévalué par rapport à sa
vraie valeur, mais n'est pas dans un environnement qui permet de favoriser une
hausse du coût par mille, comme c'est le cas dans le marché ontarien, à titre
d'exemple.
LISTNUM 1 \l 14565 M.
PÉLADEAU: Monsieur le vice‑président, je pense qu'on est en train
d'empiéter sur la prochaine audience publique.
LISTNUM 1 \l 14566 CONSEILLER
ARPIN: Oui, mais quand même ‑‑
LISTNUM 1 \l 14567 M.
PÉLADEAU: La distribution ‑‑
LISTNUM 1 \l 14568 CONSEILLER
ARPIN: Oui. C'est vrai. Mais sauf qu'effectivement, une des raisons
pour laquelle vous mettez de l'avant l'option de retrait c'est aussi les
caractéristiques du marché francophone par rapport au marché anglophone. Donc, c'est pour ça que je me sens un peu
dans l'obligation de d'avoir un portrait le plus compréhensif possible pour
être en mesure d'assister le Conseil dans sa décision.
LISTNUM 1 \l 14569 Monsieur
Morin vous a posé une question par rapport l'utilisation de la production
indépendante et puis essayer de savoir quelle serait la proportion d'émissions
faites par les producteurs indépendants par rapport à celle réalisée par une
filiale.
LISTNUM 1 \l 14570 Monsieur
Lampron nous a dit que les règles exigeaient que 75 pour cent des émissions
prioritaires soient faites par des producteurs indépendants; monsieur Lavoie
nous a dit ‑‑ nous a fait un commentaire à ce sujet‑là.
LISTNUM 1 \l 14571 Monsieur
Dion, vous avez dit que vous ne pouviez pas faire d'émissions de variétés parce
que l'émission que vous proposez, vous voulez la faire par une société filiale,
et les sommes qui vous sont allouées par le Fonds, actuellement, vous
contraignent à ne pas être capable ‑‑ à ne pas accéder au
Fonds pour produire votre émission de variétés.
LISTNUM 1 \l 14572 Donc
si je comprends bien, malgré l'ensemble des réponses qu'on a, certainement vous
voudriez toujours aller de l'avant avec votre projet d'émission de variétés,
puis vous voudriez qu'elle soit financée en bonne partie par le fonds Quebecor?
LISTNUM 1 \l 14573 M.
DION: Tout ce que je disais... Je ne
disais pas qu'on n'offrait pas cette émission de variété‑là. Tout ce que je disais, j'essayais d'exprimer,
c'est qu'il y a eu beaucoup de discussions dans les trois derniers jours : pourquoi que le contenu canadien, on n'a pas
eu plus de succès au cours des dernières années à réellement créer soit des
formats ou des séries dramatiques qui ont vraiment un potentiel à
l'international?
LISTNUM 1 \l 14574 Et
là, moi j'ai un exemple concret qui démontre que oui, on peut faire la variété
quand même, pour le mois de septembre.
Mais on a une occasion extraordinaire, une preuve extraordinaire
que ‑‑ on cherchait tout à l'heure la formule gagnante pour
avoir du succès à l'international, bien ça serait justement d'approcher ce
genre de variétés‑là dans un concept ou on a la capitalisation nécessaire
pour créer avec un nouveau fonds; la capitalisation nécessaire pour créer
vraiment un format qui a vraiment le potentiel d'être compétitif à l'échelle
internationale et, en plus, penser dans un contexte de différents canaux de distribution
qui reflètent la réalité actuelle.
LISTNUM 1 \l 14575 Ça
fait que je ne disais pas qu'on ne peut pas le faire, je fais juste dire ‑‑
J'essayais d'exprimer qu'on a une preuve concrète de l'opportunité qu'on
aurait, en tant que joueurs du paysage télévisuel canadien, de commencer avec
une nouvelle structure pour vraiment avoir du succès avec nos émissions
canadiennes, ce que d'autres joueurs à travers le monde ont compris et ont
fait.
LISTNUM 1 \l 14576 Et
là, nous, on ne le fait pas présentement, à cause des structures actuelles.
LISTNUM 1 \l 14577 CONSEILLER
ARPIN: J'entends bien ce que vous dites.
Vous avez, dans votre présentation orale, monsieur Péladeau, fait
allusion aux difficultés que ‑‑
LISTNUM 1 \l 14578 Et
monsieur Lampron avait longuement élaboré, au niveau du conseil, à discuter
puis même d'arriver à obtenir du financement pour des multiplatesformes, et
particulièrement le VOD, parce qu'au moment ou, en 2006, les discussions ont eu
lieu, la vidéo sur demande était pour vous une haute priorité mais ‑‑
LISTNUM 1 \l 14579 Je
pense qu'elle le demeure tout le temps, toujours. Mais à ce moment‑là, elle l'était
particulièrement et peut‑être que les nouvelles plateformes d'Internet,
elles étaient là, mais elles n'avaient certainement pas la performance qu'elles
ont aujourd'hui en terme de capacité puis de transport, ça m'amène à ‑‑
LISTNUM 1 \l 14580 Et
vous avez fait une remarque à savoir que finalement vous avez ‑‑
Il y a des chicanes, au niveau du conseil d'administration du Fonds canadien
qui font en sorte que rien ne puisse débloquer. Cependant, on sait et c'est
assez évident que tout ça aussi, tous ces acharnements de part et d'autre à
vouloir arriver à une solution découle de ce qu'on appelle en anglais les «
terms of trade » et qui, pour l'instant, ne sont pas encore réglées, du moins à
ma connaissance.
LISTNUM 1 \l 14581 Ma
question est plus ‑‑ parce que je sais que le Conseil dans
certaines de ses décisions récentes en a fait allusion, aux fameux « terms of
trade », mais comme on n'a pas eu de décisions récentes qui ont impliqué Groupe
TVA, on n'a pas pu en parler avec vous.
LISTNUM 1 \l 14582 Mais
est‑ce qu'il y a effectivement, quand même, des discussions entre les
différents organismes représentant des ayants droits et Groupe TVA? Et si oui, qu'est‑ce que vous pouvez
nous dire, à ce sujet‑là? Je
comprends que c'est des discussions qui sont de nature confidentielle, s'il y
en a. S'il n'y en a pas c'est moins
confidentiel,
LISTNUM 1 \l 14583 M.
DION: Mais je pourrais dire que depuis deux ans, il y a effectivement eu (peut‑être
même trois ans) y a eu différentes rencontres entre différents intervenants de
l'industrie. La problématique de base et
pourquoi qu'on en arrive toujours à une impasse, c'est qu'on n'a pas l'air à
tous comprendre la réalité du marché actuel.
LISTNUM 1 \l 14584 Donc,
lorsque dans une discussion on ne s'entend pas sur le point de départ, c'est‑à‑dire
la réalité dont fait face les généralistes, puis là je ne commencerai pas à
répéter, effectivement, tout ce qu'on sait au niveau de la fragmentation et
cetera, et cetera, mais c'est difficile d'en arriver à des solutions.
LISTNUM 1 \l 14585 Mais
je pense qu'aujourd'hui on a démontré qu'on avait une solution qui permettrait
à tous les joueurs avec l'augmentation importante de l'investissement dans le
contenu canadien ‑‑ c'est clair, les chiffres sont là pour le prouver que tous les joueurs de
l'industrie au Québec vont en bénéficier.
LISTNUM 1 \l 14586 C'est
quand tu doutes des investissements puis encore là, je ne répéterai pas ce que
Pierre‑Karl a dit, mais les créateurs, les concepteurs et cetera, vont
tous... et les producteurs vont tous en bénéficier comme tel.
LISTNUM 1 \l 14587 Puis
Luc Lavoie l'a mentionné également, TVA ne serait pas capable de tout créer, et
de tout produire. C'est impossible
logistiquement. Puis TVA n'a pas le
monopole des bonnes idées. Et ce serait
une grave erreur de penser qu'on l'a.
LISTNUM 1 \l 14588 Et
c'est pour cela que je pense que les forces du marché feraient qu'on veut
rester numéro un et on trouverait des ententes éventuelles avec les
producteurs. Sauf qu'encore là, il
faudrait que tout le monde puisse admettre une fois pour toutes que le statu
quo n'est pas acceptable et il faut drastiquement trouver des nouvelles
solutions pour recommencer à faire, entre autres, au niveau des dramatiques, le
genre de séries qu'on faisait dans le passé, mais sous un autre modèle
d'affaires.
LISTNUM 1 \l 14589 CONSEILLER
ARPIN: Je me vois contraint de vous poser quand même un certain nombre de
questions au moins pour avoir un dossier complet et qui vont traiter plutôt
cette fois‑ci que finalement, le Fonds canadien demeure et puis Vidéotron
est appelée à y contribuer. Et l'option
de retrait n'a pas été retenue par le Conseil et puis donc...
LISTNUM 1 \l 14590 Alors,
si j'ai bien compris monsieur Lampron quand il a fait sa description de la
dynamique du conseil d'administration, est‑ce que je peux voir ça comme
étant un plaidoyer pour un conseil d'administration exclusivement formé
d'administrateurs indépendants non liés et que ‑‑ Donc, faire
sorte qu'au Fonds canadien on ne retrouve aucun représentant des
radiodiffuseurs, des distributeurs et des producteurs, comme c'est le cas
présentement.
LISTNUM 1 \l 14591 Et
évidemment, encore moins les autres qui nous ont demandé, au cours des derniers
jours d'avoir droit, également, à un siège au conseil du Fonds canadien.
LISTNUM 1 \l 14592 M.
LAMPRON: Je pense que vous avez bien compris, dans la démonstration que j'ai
tenté de faire était la description d'un Fonds canadien en son état avec les
modes de gestion qui illustraient, avec les résultats que vous avez entendus
depuis deux jours les représentants revenir les uns après les autres pour
plaider en faveur du statu quo actuel.
LISTNUM 1 \l 14593 Nous
avons une seule proposition, Monsieur Arpin.
C'est la proposition « d'opting out », parce que nous pensons vraiment
que le Conseil ‑‑
LISTNUM 1 \l 14594 CONSEILLER
ARPIN: Donc, en d'autres mots ‑‑
LISTNUM 1 \l 14595 M.
LAMPRON: Nous pensons vraiment que le
Conseil, dans sa grande sagesse, va reconnaître cette opportunité de pouvoir,
justement, rencontrer à la fois les objectifs publics et à la fois les
objectifs que nous avons décrits. Et je
ne pense pas que nous ayons l'intention, si vous voulez, d'élaborer sur une
deuxième préférence qui n'existe pas.
LISTNUM 1 \l 14596 CONSEILLER
ARPIN: Donc, si le Conseil n'adhérait
pas à votre proposition, bien, vous continueriez à être désolés de ne pas avoir
été compris et puis vous accepteriez de vivre dans le système qui serait
proposé?
LISTNUM 1 \l 14597 M.
LAVOIE: Monsieur le vice‑président,
on a toujours respecté les règles qui ont été édictées par le Conseil et on va
continuer de le faire, mais on n'a pas de deuxième choix.
LISTNUM 1 \l 14598 On
est sincèrement convaincus que le Fonds, tel qu'il existe, est nuisible et
néfaste à la production canadienne de télévision parce qu'il refuse de
s'adapter à son évolution et ce marché‑là. Et ça ne serait franchement pas honnête, et
même une forme de sophisme que d'essayer de vous répondre : « Eh bien, comme deuxième choix, nous
préférons ceci ou cela. » On n'a pas de
deuxième choix.
LISTNUM 1 \l 14599 CONSEILLER
ARPIN: D'accord. Donc, ça ne me donne
rien de vous demander ce que vous pensez de la lettre que monsieur Lind vous a
fait parvenir, Monsieur... ‑‑ qu'il a fait parvenir à monsieur
Barrett, mais dont vous‑même, Monsieur Lavoie avez reçu une copie?
LISTNUM 1 \l 14600 M.
LAVOIE : Bien, monsieur Lind est
quelqu'un que je respecte énormément.
J'ai bien sûr lu la lettre de monsieur Lind. J'en ai pris connaissance et j'ai trouvé
qu'elle était fort bien écrite. Merci.
LISTNUM 1 \l 14601 CONSEILLER
ARPIN: Bienvenue. Je n'ai plus de
questions, Madame la présidente.
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 14602 THE
CHAIRPERSON: I do have some further
questions for you and I do apologize, but I will be asking you in English. And the questions I have relate to your
opting out proposal. You put something
concrete on the table, we are going to want more details.
LISTNUM
1 \l 14603 How
do you respond to those who say that the financing of Canadian content is
complicated enough and by adding yet another fund to the whole system you are
just increasing that complexity and adding another layer, perhaps, of confusion
because this might have more rules, it might have different rules, might have
fewer rules, but in the end it is another layer of complexity?
LISTNUM
1 \l 14604 MR.
PÉLADEAU: Well, I think that, you know,
our proposal is pretty simple. It is,
you know, getting rid of all those rules.
And the dollar that will be spent will be a dollar spent in the Canadian
broadcasting system. There are not going
to be any sources of, you know, bureaucrat fees or admin or stuff like that.
LISTNUM
1 \l 14605 You
know, we really think that, you know, spending the money, as we say in French,
you know, à l'écran would be a pure and a complete benefit for, you know, the
Canadian landscape and all the people that work around us.
LISTNUM
1 \l 14606 THE
CHAIRPERSON: Okay. Now, obviously, I understand that you have
put forward the best proposal that will work for your company, that is
obvious. But are you suggesting that the
Commission amend the Regulations for all BDUs to have the option to opt out of
contributing to the CTF?
LISTNUM
1 \l 14607 MR.
PÉLADEAU: I would like also, you know,
to emphasize the fact that I don't think it is only for the benefit of Quebecor
Media, I think ‑‑
LISTNUM
1 \l 14608 THE
CHAIRPERSON: No, no, but what I mean, it
is what works best for you in terms of how you want to see Canadian content
funded, that is what I mean. It is what
works best for you and you have every right to do that.
LISTNUM
1 \l 14609 MR.
PÉLADEAU: Yes, but I think it goes, you
know, further than only being good for Quebecor Media. I think it is good for the entire
industry. And the entire industry will
benefit from, you know, this additional contribution that is not there
today. And, you know, it will be done
with a more efficient way that opens the doors to possible capacity to build
something that will be exportable.
LISTNUM
1 \l 14610 And,
as we have been seeing some strong Canadian industry being able to export and
to be able to be champions in their own activities, you know, there is no
reason why that, you know, where we have been subsidizing this industry for so
long with that amount of money that we are not going to be able to do that.
LISTNUM
1 \l 14611 So
for the second part of your question, I guess that, you know, certainly
something that the Commission would need to deal with, I don't think it is our
role as a participant in the industry, you know, to figure out what will be the
Commission's decision. What we think is,
you know, what we are proposing is in the best interest of the Canadian
broadcasting landscape. And, from there,
obviously this is the only thing we can do or we can say, because we are not,
you know, ruling other than what we are able to say.
LISTNUM
1 \l 14612 MR.
LAVOIE: In other words, if I may add, we
don't have any mandate to speak on behalf of any other BTUs. And what we are proposing, by definition,
opting out would mean that there is still something left. I mean, it is up to the rest of the system in
cooperation and in discussion and dialogue with you to determine what the best
way is to serve the Canadian system because, after all, that is what the law
says. We are not here speaking on behalf
of anybody else than who we are.
LISTNUM
1 \l 14613 THE
CHAIRPERSON: No, but we are just trying
to gather as much information as we possibly can ‑‑
LISTNUM
1 \l 14614 MR.
LAVOIE: I understand.
LISTNUM
1 \l 14615 THE
CHAIRPERSON: ‑‑ from the different perspectives and,
therefore, put opinions on the table ‑‑
LISTNUM
1 \l 14616 MR.
LAVOIE: We understand.
LISTNUM
1 \l 14617 THE
CHAIRPERSON: ‑‑ that matter. You know, because Rogers did
come and they had a different proposal than yours, and that is a separate fund,
a separate governing body, a separate board of directors for that fund, but
still administered by the CTF where that fund would only receive contributions
from private companies and not any public money.
LISTNUM
1 \l 14618 And
so, with your proposal, our job now is to see, okay, well what are the
differences between those two proposals ‑‑
LISTNUM
1 \l 14619 MR.
LAVOIE: Yes.
LISTNUM
1 \l 14620 THE
CHAIRPERSON: ‑‑ and what is going to work best for the
Canadian broadcasting system.
LISTNUM
1 \l 14621 MR.
LAVOIE: Right.
LISTNUM
1 \l 14622 THE
CHAIRPERSON: So is the Rogers proposal
acceptable to you? Should we say, you
know what, Quebecor was a great proposal but we just can't go that far so we
are going to stick with the Rogers proposal?
LISTNUM
1 \l 14623 MR.
LAVOIE: Well, as I said to ‑‑
and I fully respect what you are doing now ‑‑ but as I said to
Mr. Arpin earlier, we have one clear proposal and we believe that, you know, it
is a well thought‑out rigorously developed proposal, we believe that it
is the only proposal that will help serve best the system of broadcasting in
Canada.
LISTNUM
1 \l 14624 And,
no, we don't disagree or agree with Rogers, it is a completely different
approach in a completely different market.
LISTNUM
1 \l 14625 THE
CHAIRPERSON: Would public broadcasters
be able to access let us call it the QMI fund just for the sake of identity?
LISTNUM
1 \l 14626 MR.
LAVOIE: Of course not. Because when it comes to public broadcasters
or state broadcasters we always feel, and I certainly do, and as a corporation
we do, that trying to mix private broadcasters and state broadcasters will
never work, because we are accountable to different entities. We are accountable to our shareholders, they
are accountable to the Parliament of Canada.
LISTNUM
1 \l 14627 We
don't have to determine the level of funding that the state broadcasters should
receive. This should be done by the
Parliament of Canada because this is where they are accountable. And if the Parliament of Canada comes to the
conclusion that the funding level is inadequate and it should come up, it
should raise, well, it is their decision.
LISTNUM
1 \l 14628 It
shouldn't be mixed with us, because we are two different animals, so different
that when you mix the two you are trying to accomplish something that we think
is not fair. It is a way of trying through the backdoor to get something
that ‑‑ I mean, if indeed the state broadcasters should have
more money, let the parliamentarians, that is the way the democratic system
works, decide. If they think that they
receive too much, let them decide. Their
accountability is there, ours is to our shareholders.
LISTNUM
1 \l 14629 THE
CHAIRPERSON: What about broadcast‑affiliated
production companies? You heard Corus
yesterday saying that Nelvana should be able to make use of the CTF fund. Would Nelvana, just for example, be able to
make use of the QMI fund?
LISTNUM
1 \l 14630 MR.
LAVOIE: We certainly agree with that,
yes.
LISTNUM
1 \l 14631 THE
CHAIRPERSON: Thank you very much,
gentlemen. Those are all our questions,
thank you.
LISTNUM
1 \l 14632 M.
PÉLADEAU: Merci, Madame le Président.
LISTNUM
1 \l 14633 THE
CHAIRPERSON: We will take 15 minutes.
LISTNUM
1 \l 14634 MR.
LAVOIE: Thank you, merci.
‑‑‑ Upon recessing
at 1121 / Suspension à 1121
‑‑‑ Upon resuming
at 1140 / Reprise à 1140
LISTNUM
1 \l 14635 THE
SECRETARY: We will now hear the
presentation of CanWest MediaWorks.
Please introduce yourself, and you have 15 minutes. Thank you.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 14636 MR.
MEDLINE: Good morning, commissioners and
Commission staff.
LISTNUM
1 \l 14637 CanWest
is pleased to participate in the oral phase of this important and comprehensive
proceeding regarding the future of the Canadian Television Fund.
LISTNUM
1 \l 14638 My
name is Jon Medline, I am the Vice‑President of Regulatory Affairs at
CanWest. Seated to my immediate right is
Barb Williams, Executive Vice‑President of Content. Barb oversees the acquisition, production and
scheduling of content on all of CanWest's domestic television assets and
digital media platforms.
LISTNUM
1 \l 14639 To
Barb's right is Christine Shipton, Senior Vice‑President of Drama and
Factual Content. Christine is in charge
of developing and commissioning dramatic and factual programming for all of
CanWest's specialty services in addition to the priority programming slates for
our Global and E! conventional television stations. And at the far end of the row is Tara Ellis,
Vice‑President of Showcase and Drama Content.
LISTNUM
1 \l 14640 For
clarity, we note that no member of the CanWest panel currently sits on the CTF
board.
LISTNUM
1 \l 14641 At
the outset we want to be clear, we support the CTF and its envelope
system. It serves an important role in
the Canadian broadcasting system, it enables the creation of quality Canadian
television programs. But, like all
organizations, including our own, there comes a time when we have to step back
and consider ways to change and improve, and we are pleased that the CRTC has
provided such an opportunity.
LISTNUM
1 \l 14642 We
support the task force proposal to have one administration oversee two streams
of funds, including a private‑sector stream derived from BDU
contributions to be directed to private broadcaster envelopes. We further believe that audience success with
an eye to maximizing audiences to Canadian programming should be the foundation
of the private sector stream.
LISTNUM
1 \l 14643 In
today's presentation, we focus primarily on audience measurement tools with a
goal to meet the task force's stated objective, that these funds should be
allocated using the BPE system and implemented by way of the simplest possible
program guidelines. And, of course,
following our presentation we would be pleased to address the task force's
other recommendations, including those related to benefits packages and return
on investment.
LISTNUM
1 \l 14644 MS
WILLIAMS: It is unlikely that the
industry will undertake such an in‑depth study of the CTF again anytime
soon, so we use this opportunity to step way back and consider how we arrived
here.
LISTNUM
1 \l 14645 And
what we discovered is that a few simple decisions related to funding have had
far‑reaching impacts. First, in
2005/2006 the CTF board made a decision to adopt broadcaster envelopes for
drama and used as its metric 100 per cent historic access from the years
2002/2003 through 2005/2006.
LISTNUM
1 \l 14646 The
results of that decision and the arbitrary choice of those three years as the
metric will have long‑lasting consequences for all parties involved in
CTF drama funding, because that baseline established and then locked in huge
discrepancies between the major conventional broadcasters. Moreover, the current formula has continued
to perpetuate reliance on historic access and other funding criteria unrelated
to audience success.
LISTNUM
1 \l 14647 In
fact, a full 60 per cent of the current formula is unrelated to audience
success. This allocation does not reflect one of the task force's central
recommendations and this is the disconnect that we hope to address today.
LISTNUM
1 \l 14648 In
preparation for this appearance CanWest carefully assessed the 2007/2008 CTF
broadcaster performance envelopes. We
particularly focused on the English‑language envelope and, specifically,
excluded the CBC and other educational services to see what the world would
have looked like under a two‑stream model. And what we discovered was astonishing. The remaining English‑language
performance envelope would have been about $103 million in 2007/2008. The conventional share of that number, under
$28 million.
LISTNUM
1 \l 14649 In
other words, English‑language conventional stations would have accounted
for less than 27 per cent of the private English‑language envelope. This level is inappropriate even if you
ignore the regulatory obligations placed on conventional stations, including
the eight hours of priority programming and peak viewing hours.
LISTNUM
1 \l 14650 In
a continually fragmenting world the conventional platform still offers the most
opportunity for audience success and it is especially adept at maximizing
audiences to first window exhibition. We
believe it is the platform that offers the best chance for a new domestic
program to reach a mass audience and that that success then flows to other
windows and other platforms.
LISTNUM
1 \l 14651 Simply,
if the Commission wishes to assign audience success as the primary objective of
the private sector stream, then it must address the arbitrary allocation of
funding between conventional and specialty.
LISTNUM
1 \l 14652 When
we consider recent total hours tuned data, and that is a metric we will discuss
in a moment, a more appropriate allocation to English‑language
conventional stations would be about 50 per cent with the remaining 50 per cent
going to specialty services and, over time, these allocations would be assessed
and updated to reflect changing viewing patters.
LISTNUM
1 \l 14653 To
be clear, we don't downplay the role of specialty in the system. But when Teletoon English, a single specialty
service typically carried on cable's third tier, has an envelope allocation of
$12.2 million in 2007/2008, $4 million more than the entire allocation to
CanWest conventional stations and $11.1 million more than the last CHUM
conventional allocation, then it is time to readjust the formula, especially if
audience success is to be the key criterion.
LISTNUM
1 \l 14654 MS
SHIPTON: But correcting the allocation
between conventional and specialty only solves part of the problem. In fact, if we only address that issue, the
funding allocation problem gets worse.
LISTNUM
1 \l 14655 When
we exclude the CBC, the current formula managed to allocate two‑thirds of
the available conventional funding to one company, CTV. And if the conventional share goes up to 50
per cent, CTV would simply take two‑thirds of this higher amount. Also, due to the historic access criterion,
this advantage would be locked in forever, since each successive year relies on
the year before.
LISTNUM
1 \l 14656 From
a CanWest standpoint, our attention to high‑quality Canadian drama over
the past two years goes unrewarded since historic access locked in our
disadvantage years ago. Such
concentration of funding is not good for the Canadian broadcast system.
LISTNUM
1 \l 14657 It
obviously limits CTF participation by broadcasters raising a fundamental
question of fairness and it creates an awkward competitive environment where
certain parties must finance more of their priority programming outside of the
CTF, essentially forcing these parties to commission lower cost drama, often in
restrictive partnerships, or to commission alternative priority programming
genres. It also hurts the independent
production community, since effectively only one of the doors they are knocking
on has the capacity to fund multiple big‑budget projects.
LISTNUM
1 \l 14658 There
is a straightforward solution to this problem.
Replace the current formula with a simple and appropriate measurement
tool, hours tuned to the station, and then let the market incentives of the
envelope system takeover.
LISTNUM
1 \l 14659 We
submit that the approach to focus on is the environment of success rather than
individual show performance. Frankly,
this is far less complex and more appropriate for allocating CTF funding.
LISTNUM
1 \l 14660 As
you have heard all week, if there is one thing we know as television executives,
producers or broadcasters here, in Hollywood or anywhere else, it is that
success of a given show or slate of shows cannot be guaranteed, but chances of
success are improved if the environment is supportive of success.
LISTNUM
1 \l 14661 MS
WILLIAMS: So what do we mean by hours
tuned to the station and why do we feel this is the appropriate metric and why
is it better than just reach and why shouldn't we just look at the success of
individual shows supported by the CTF and the so‑called CTF‑ables?
LISTNUM
1 \l 14662 We
have an analogy for you here. Picture a
football stadium. And if it is empty and
if no one shows up, then no matter how good the game may be, it has clearly not
met any meaningful audience success criteria.
But now, let us say a throng of fans rush through the turnstiles, the
stadium is packed, but at the end of the first quarter they all get up and walk
out. They don't hear the stadium announcer promote other stadium events or even
the next game.
LISTNUM
1 \l 14663 In
television measurement terms that game would have had big reach, the size of
the audience would be measured by the turnstile. But the opportunities to promote other
activities and any real gauge of audience satisfaction would be absent. They came, but they didn't stay very long.
LISTNUM
1 \l 14664 But
now, picture those same fans streaming into the stadium and staying for the
whole game, you make them comfortable, cushy seats, a friendly atmosphere and,
of course, a good game, a good show.
They are going to hear the stadium announcer promote those other stadium
events, the next game and the game after that.
They will be exposed to multiple promotions all over the stadium. In other words, as a smart stadium operator,
you have now created an environment that maximizes the opportunity for more
participation and bigger audiences.
LISTNUM
1 \l 14665 The
television equivalent is total hours tuned and it represents the number of
people reached by a given channel, just called reach, multiplied by average
mitted audience, how long they stayed in that stadium, and then converted to
hours. The metric accounts for the
environment that exposes larger audiences to Canadian programming from
underrepresented genres and helps build word of mouth.
LISTNUM
1 \l 14666 Let
us look at the situation we now have on conventional, and I acknowledge I have
rounded some of these numbers here a little bit. Currently, the $18.5 million goes to CTV,
$8.2 million goes to CanWest, and about $1 million goes to Rogers Media and
others. If we use the current funding methodology
and increase the allocation to conventional to 50 per cent, then the 2007/2008
result would have looked like this; $34 million to CTV, $15 million to CanWest,
and $2 million to Rogers Media. We would
not consider this to be an equitable allocation of conventional funding.
LISTNUM
1 \l 14667 If
we apply total hours tuned, however, instead of the current formula, the
playing field naturally adjusts and the market incentives of the envelope
system takeover. For example, if we use
the adult 18‑49 demographic, here is what the allocation would have
looked like then, $23 million to CTV, $19 million to CanWest and $10 million to
Rogers Media. And, frankly, if we used
adult 25‑54 as the demo the results would be similar. Now, that is a much more fair allocation. And note that the biggest beneficiary of this
change is not CanWest, but Rogers.
LISTNUM
1 \l 14668 MS
ELLIS: The specialty part of the
equation requires some additional consideration. Only those services that participate in a
meaningful way and recognize CTF genres should be allowed to access the
fund. And we submit that the most
appropriate allocation methodology is as follows.
LISTNUM
1 \l 14669 Step
1, allocate half the English‑language performance envelope to speciality
services, an allocation to be reassessed on a regular basis. Step 2, determine an allocation percentage
for each of the four programming genres.
The CTF board should be responsible for setting the genre
allocations. But let us assume for today
that the current allocations stay constant.
LISTNUM
1 \l 14670 Step
3, allocate funding to each eligible specialty service within each genre, and
here we mirror the approach to conventional.
Total hours tuned would indicate the potential for success of a given
show on a particular service. And then
the envelope system, already in place, would incent broadcasters in the private
stream to maximize audience.
LISTNUM
1 \l 14671 In
essence, instead of a large football stadium, you would have four arenas
representing each of the genres.
LISTNUM
1 \l 14672 We
acknowledge that the revised allocation between conventional and specialty
would decrease the funding to the specialty services, including our own stable
of specialties that now includes the former Alliance Atlantis services. And we recommend that current genre
allocations be maintained, at least in the medium term, to mitigate anymore
significant decline in funding for specific licensees.
LISTNUM
1 \l 14673 MS
WILLIAMS: Commissioners, we realize that
we have thrown some big ideas at you in this presentation and a good many
numbers. But our primary objective here
today is to impart the necessity of getting the measurement tools right, and
part of that process is to step back and consider exactly what will happen when
the CBC and educational broadcasters are moved to a different stream.
LISTNUM
1 \l 14674 It
changes the numbers, it changes the allocation percentages and, frankly, it
exposes in very plain view the inequity of the current formula, a formula we
emphasize that locks in advantage and disadvantage forever and does not reflect
a primary emphasis on audience success.
LISTNUM
1 \l 14675 The
Commission could have a very important role in directing the CTF to address and
revise this formula in light of the current recommendations.
LISTNUM
1 \l 14676 We
thank you for this opportunity and we would be pleased to answer any questions.
LISTNUM
1 \l 14677 THE
CHAIRPERSON: Thank you, Ms Williams and
your colleagues. I will ask Vice‑Chairman
Arpin to lead the questioning.
LISTNUM
1 \l 14678 COMMISSIONER
ARPIN: Thank you very much, Madam Chair.
LISTNUM
1 \l 14679 I
think your oral presentation is very clear.
I think it doesn't require a lot of questions to be asked, because every
time there had been a question you immediately proposed an answer.
LISTNUM
1 \l 14680 But,
nevertheless, just for the record, you may not be on the board at this time,
but you have been or a representative of CanWest has been on the board of the
CTF over the years.
LISTNUM
1 \l 14681 MS
WILLIAMS: I have been a member of the
CTF board before, but not as a representative.
I am trying to remember. Well, I
guess it was CanWest. I was at CanWest
at the end of my board term, yes, I was.
LISTNUM
1 \l 14682 COMMISSIONER
ARPIN: Okay. But there were other individuals. I am not asking who was a member of the board
or not, but they were members, staff of CanWest, over the years who have sat on
the board of the CTF. I guess from 1996
to today there has been some rotation from various organizations and at some
point in time the representatives of CanWest were on the board.
LISTNUM
1 \l 14683 When
the drama envelope was drawn up in 2005/2006 was a representative of CanWest on
the board at that time?
LISTNUM
1 \l 14684 MS
WILLIAMS: You know, we were talking
about this the other day, and I was trying to remember the exact process of how
that all unfolded. There was great
difficulty at the time in determining how that initial allocation was going to
be made. And there was, and I hope my
memory is serving me right here, there was a very specific offsite held with a
facilitator that was brought in to see if a resolution could be found.
LISTNUM
1 \l 14685 I
was at that offsite, so CanWest had a voice in that, but there were many many
other voices there that ultimately, you know, decision was made as I say it
was. And then it was endorsed by the
board and I was on the board at the time it was endorsed. There was much discussion, but at the end it
was felt that historical access was a fair and reasonable way to measure.
LISTNUM
1 \l 14686 COMMISSIONER
ARPIN: To measure.
LISTNUM
1 \l 14687 MS
WILLIAMS: Yes.
LISTNUM
1 \l 14688 COMMISSIONER
ARPIN: Because, obviously, what you are
saying here gave rise to what Shaw has been arguing, is that a stakeholder
board at the end of the day ‑‑ and I think this morning, if I can
find the exact quote in Mr. Stein's presentation ‑‑ but he
said that the stakeholder board, at the end of the day, is only self‑serving
for those who are on that board on that very day. Will you agree with that statement?
LISTNUM
1 \l 14689 MS
WILLIAMS: I think it is a very, and has
been for years, a very complicated and complex board, large and unwieldy. I think the passion often expressed at the
board meetings was often a reflection of how much everyone cares about the CTF
and really believed it needed to be well run.
LISTNUM
1 \l 14690 I
think it often got bogged down in the complexity of details around a huge set
of rules that grew and grew and grew over time as various stakeholders tried to
understand impact to their own situations.
And it is why one of the things we are really trying to address here is
a real simple, straightforward, one‑measure approach that would takeaway
a huge layer of that.
LISTNUM
1 \l 14691 COMMISSIONER
ARPIN: Well, I will have some further
discussion on the measure system that you are proposing or whatever, not
specifically on the mathematics of it, but on the principle.
LISTNUM
1 \l 14692 So,
as you just said, the board is large, is unwieldy and comes with all its
problems at the end of the day. So my
question to you is that, if I was asking you for your comment, I guess that you
are going to tell me that you favour a much smaller board made up of
independent non‑related directors.
Am I right to deduct that from your earlier statements?
LISTNUM
1 \l 14693 MS
WILLIAMS: Yes, I would endorse a board
that was smaller. But, equally
importantly, I would endorse a board that was clear in its role compared to the
staff of the CTF, a board that was clear in its role of the chair versus the
president, and a board that was overseeing an organization that was operating
under much cleaner, simpler, more straightforward rules.
LISTNUM
1 \l 14694 COMMISSIONER
ARPIN: I don't know if you had an
opportunity to read the filings that the CTF made I will say a couple of weeks
ago regarding the role of the chair versus the role of the president and CEO
and some other governance documents.
They have, to some extent, followed up on some of the recommendations
that the task force had made. So I don't
know if you had a chance to see these documents that had been filed about two
weeks ago. And, if yes, do you have any
comments to make?
LISTNUM
1 \l 14695 MS
WILLIAMS: I haven't read them thoroughly
enough to comment myself, but you might, John.
LISTNUM
1 \l 14696 MR.
MEDLINE: I have read them. Frankly, though, our emphasis today was not
on the Board or Board governance itself, although some of what you heard in the
opening remarks flows from Board decisions, but rather on the guidelines that
really steer the funding around the system to various parties and to various
places.
LISTNUM
1 \l 14697 I
have read them. Obviously it is
important that all organizations, whether the CTF or any other organization,
look closely at governance.
LISTNUM
1 \l 14698 This
exercise, I think, has been quite good for all parties, but really, when it
comes to governance issues, we haven't dealt in great depth between president
versus chair and that kind of issue.
LISTNUM
1 \l 14699 COMMISSIONER
ARPIN: Thank you. That is a fair answer.
LISTNUM
1 \l 14700 Back
to your submissions, did you have a chance to discuss the proposal with any
other existing stakeholder?
LISTNUM
1 \l 14701 Not
necessarily through the CTF Board, but through other ways.
LISTNUM
1 \l 14702 I
know that you recently filed a joint submission with CTV in another forum, for which
I am not opening any discussion. You may
have an opportunity to discuss that at that time.
LISTNUM
1 \l 14703 You
are a member of trade associations. You
are a member of various organizations, or joint ventures, even one that is
called BBM, and that is where most of the people that are competing in Toronto
get together once in a while.
LISTNUM
1 \l 14704 Did
you have a chance to discuss the proposal before, or is this the first time
that you are really laying it down?
LISTNUM
1 \l 14705 MR.
MEDLINE: I think it would be safe to say
that, formally, it is the first time we have laid it down. That's for certain.
LISTNUM
1 \l 14706 I,
personally, have had a couple of conversations with representatives of specific
broadcasters; not CTV in this particular instance, for, I think, fairly obvious
reasons.
LISTNUM
1 \l 14707 At
the CAB level, of course, there were multiple discussions.
LISTNUM
1 \l 14708 The
CAB discussions and what was presented earlier in the week from the CAB was, I
think, a much higher level presentation.
This is a more granular ‑‑
LISTNUM
1 \l 14709 I
wouldn't expect, frankly, the CAB to get involved in its presentation in issues
like this. It really would not ‑‑
LISTNUM
1 \l 14710 COMMISSIONER
ARPIN: Except that the CAB has a
production committee, where the members who are going to represent the
broadcasters are picked up. That
production committee ‑‑
LISTNUM
1 \l 14711 When
I was wearing a different hat, that seemed to be the place where these matters
were ‑‑ where people were trying to sort out these issues.
LISTNUM
1 \l 14712 MR.
MEDLINE: You are absolutely right. The production committee, of which Christine
Shipton is a member ‑‑ and, actually, the regulatory committee
of the CAB, of which I am a member ‑‑ met on a number of
occasions to discuss this.
LISTNUM
1 \l 14713 Most
of the discussions ‑‑ and I don't think I am talking out of
school ‑‑ most of the discussions, though, revolved around the
one fund/two streams issue. That was the
big agenda item.
LISTNUM
1 \l 14714 COMMISSIONER
ARPIN: You, surely, heard the Shaw
presentation this morning, and obviously you, more than likely, have read their
submissions and their letters over the last 15 months, so you may be able to
comment on some statements that were made, particularly this morning.
LISTNUM
1 \l 14715 Mr.
Stein laid down what he called three irrefutable facts. The first one is that the CTF does not
deliver programs that Canadians watch.
LISTNUM
1 \l 14716 Do
you have any opinion on that? Is it
true?
LISTNUM
1 \l 14717 He
went through some mathematics which, at the end of the day, showed that only 4
percent of the English‑language drama funded by the CTF ‑‑
the viewing was only 4 percent, while the Canadian English not funded by the
CTF reaches ‑‑ he didn't use the word "reach", but
the market share, I would say, is 13 percent.
LISTNUM
1 \l 14718 Based
on your own experience ‑‑ and you may not have the book with
you this morning, but I am sure you have been assessing and making calculations
every time new data comes out.
LISTNUM
1 \l 14719 Can
you assert that?
LISTNUM
1 \l 14720 MS
WILLIAMS: Christine and Tara also may
want to add to this, but, yes, I can assure you that every afternoon at about
two o'clock we assess the day before's data, so we are well entrenched in it.
LISTNUM
1 \l 14721 I
would say that there is no broadcast team out there more committed to doing the
very best with the Canadian programming that we have, from its original
development, right through its production, to the way we schedule and promote
it.
LISTNUM
1 \l 14722 And
we are really pleased with some of the results we see.
LISTNUM
1 \l 14723 "`Da
Kink in My Hair", on the Sunday night 7:30 broadcast, has done really well
for us this fall. It's a unique
project. We are really pleased with the
ratings it's getting; not just with the statement it's making and how proud we
are of the effort, but it's getting good ratings and important demos in core
markets.
LISTNUM
1 \l 14724 We
launched a couple of weeks ago "The Guard", Tuesday nights at 10:00,
the very best spot on the schedule you can find, coming out of
"House", which is the number one show in Canada ‑‑
well promoted and strongly launched. We
are getting great ratings on that show.
LISTNUM
1 \l 14725 We
are pleased with the progress we are making, but, that said, this is the
toughest game in town, and everyone is acknowledging this. The success rate for television across the
board is about 75 percent failure. Every
new slate of shows that comes out of, supposedly, the greatest television
producers in the world, out of the American system, 75 percent of those go down
every year.
LISTNUM
1 \l 14726 I
think we are doing really well, and we are doing really well despite, frankly,
having our hands tied half behind our backs because of the size of the envelope
we have. Remember, that relative amount
we have is supporting two complete conventional streams ‑‑ 16
hours of priority programming a week, not the 8 that CTV's original allocation
was supporting.
LISTNUM
1 \l 14727 But
despite that we have been determined and aggressive, and we are making some progress. I think the whole industry is making some
progress, but it's a tough slog.
LISTNUM
1 \l 14728 MS
SHIPTON: I would add that we remain
committed to supporting the genre of drama in an environment where priority
programming can be defined in many different ways.
LISTNUM
1 \l 14729 I
think it's just such an exciting time to be commissioning Canadian drama right
now, much more so than three or four years ago.
It's an extremely competitive field, and we are only going to feel
this ‑‑ these things take seasons to have a ripple effect.
LISTNUM
1 \l 14730 Right
now, between what CTV is putting on the air, our two dramas that we have
launched, the five that CBC has launched ‑‑ and they are
futzing around on their schedule, trying to make sure they are working ‑‑
we are all competing for those eyeballs for Canadian drama, and proudly so.
LISTNUM
1 \l 14731 And
we don't set out to do mediocre shows.
We always intend to do hit shows, they just don't always hit.
LISTNUM
1 \l 14732 MS
WILLIAMS: It occurred to me, listening
this morning ‑‑ I admire Shaw's success as a company, and I
admire their commitment to reach into all of the small communities and cable
them all, regardless, and that they are not held back by ‑‑
they know they need to serve their customers, and they do whatever it takes.
LISTNUM
1 \l 14733 But
it occurred to me that, if every time they dug a trench and they laid a cable
and they connected it to the homes in one of those little, small communities,
and then they flipped the switch ‑‑ if 75 percent of the time
they flipped the switch the signal just didn't work ‑‑
LISTNUM
1 \l 14734 Nobody
had any idea why. No engineer or
technical person could figure it out.
They just had to live with the fact that they made that big investment,
and try again next year. The next year
they could dig another trench alongside the first one, and lay the cable again,
and flip the switch again. Maybe it
would work.
LISTNUM
1 \l 14735 If
that was their business model, I wonder how they would feel about understanding
the world we are in.
LISTNUM
1 \l 14736 COMMISSIONER
ARPIN: An interesting analogy.
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 14737 COMMISSIONER
ARPIN: That's the first time I have
heard it.
LISTNUM
1 \l 14738 MS
WILLIAMS: We are working on analogies in
this presentation.
LISTNUM
1 \l 14739 COMMISSIONER
ARPIN: That is the first time I have
heard it, but I have to admit that it is interesting.
LISTNUM
1 \l 14740 Another
statement that was made by Shaw this morning is that the CTF has not leveraged
increased spending on Canadian programming; rather, it has freed up some money
so that you will pay more for foreign programming. So that, finally, the CTF money is purely a
subsidy to allow you to acquire more foreign ‑‑ American
programming to do more programming substitution.
LISTNUM
1 \l 14741 MS
WILLIAMS: I actually think we have
addressed some of this in past conversations, and I am happy to address it
again.
LISTNUM
1 \l 14742 As
the overseer of the budgets for all of our stations at CanWest, I can assure
you that there is no relationship between the size of the budget for the
foreign programming and the size of the budget for the Canadian
programming. They are two distinct
budgets. Each grows as it needs to, and
when one gets bigger, the other does not automatically get smaller.
LISTNUM
1 \l 14743 The
foreign programming that we buy for our conventional prime time ‑‑
the demand on that is huge, and as we add another competitor to the game,
particularly this year, as the supply has been shrinking and the demand has
been growing, yes, we have to deal with what those costs are.
LISTNUM
1 \l 14744 But
as we deal with that, in order to support the overall success of our prime time
schedule, which supports an environment that allows our Canadian programming to
be successful, we don't shrink the size of the Canadian budget. The two are completely separate and distinct.
LISTNUM
1 \l 14745 MS
SHIPTON: I would add that just because
we have limited CTF drama dollars, because we are talking about drama
specifically, doesn't mean that is the only drama we do.
LISTNUM
1 \l 14746 I
have worked very hard in the last two years with my $5.2 million in drama
envelope to create as many dramas as we can.
LISTNUM
1 \l 14747 So
there are not just the dramas like "Falcon Beach", "The
Guard" and "`Da Kink" that have CTF, we have formed
partnerships. We have partnerships with
APTN, we have partnerships with the pay networks, which don't rely on us
supplying CTF dollars, but it still gives us good drama to put on our
conventional networks.
LISTNUM
1 \l 14748 We
also form partnerships with broadcasters in the States to co‑finance
different dramas.
LISTNUM
1 \l 14749 We
also fund dramas on our own ‑‑ two seasons of "The Jane
Show", with no CTF and no other foreign partner.
LISTNUM
1 \l 14750 It
doesn't shrink the number of hours we attempt to do by taking away CTF from us.
LISTNUM
1 \l 14751 COMMISSIONER
ARPIN: Another statement ‑‑
which may be not something that you can control, but you surely have expertise
in dealing with the independent production sector ‑‑ saying
that the money that was put into the CTF over the years, and other related
programs, was deemed to help independent production to grow and become a viable
industry by itself.
LISTNUM
1 \l 14752 We
have seen a lot of consolidation in the broadcasting system and in the distribution
system over the years, but there has been not much consolidation ‑‑
to the contrary, we saw some organizations that had been successful producers
becoming pure play broadcasters, rather than keep going ‑‑
LISTNUM
1 \l 14753 Because
when they had reached a certain size, they moved out of production to become
pure play broadcasters.
LISTNUM
1 \l 14754 I
don't know if you have a specific comment to make regarding the fact that, with
all of those investments, the model that was aimed at, with significant players
in the production industry, has not yet been attained.
LISTNUM
1 \l 14755 MS
SHIPTON: I think there has been success
in the production community. It may not
be through consolidation and the growth in the actual size of these companies,
but success breeds success. That's what
our business is all about.
LISTNUM
1 \l 14756 If
you think we have a hard time picking hits, from a producer's point of view,
who puts their heart and soul into making sure that all of the stars align to
ensure that they, too, have a hit, it's three times as difficult, in my mind.
LISTNUM
1 \l 14757 But
I think there have been success stories.
We have very strong medium‑sized companies that have just
announced some fantastic deals, actually in the last week ‑‑
Shaftesbury Films, Barna‑Alper, Brightlight Pictures, Blueprint
Entertainment ‑‑ whatever Bill Mussel's(ph) new company is
called ‑‑ the deal in the States ‑‑
LISTNUM
1 \l 14758 I
think you have seen a consolidation of talent.
These companies are making sure that they are using the best we have in
the country to create the best series.
LISTNUM
1 \l 14759 So
I think there has been success in our production community.
LISTNUM
1 \l 14760 COMMISSIONER
ARPIN: Thank you.
LISTNUM
1 \l 14761 My
last question to you ‑‑ and I am going back to your oral
presentation ‑‑
LISTNUM
1 \l 14762 I
am sure you have looked at what will be the impact on the services you have
just acquired. Obviously, I can deduce
from your presentation that there will be an impact on Teletoon. Otherwise, you would not have quoted them.
LISTNUM
1 \l 14763 What
will it mean for the specialty services that you have just acquired?
LISTNUM
1 \l 14764 MR.
MEDLINE: I can address that from a
numbers standpoint.
LISTNUM
1 \l 14765 We
did modelling on the conventional and on the specialty side using this plan.
LISTNUM
1 \l 14766 On
the specialty side, first off, you are absolutely right ‑‑ and
this is a fixed‑pie calculation ‑‑ if you increase on
conventional, you are going to take out on the discretionary, or, as we termed
here, the specialty side.
LISTNUM
1 \l 14767 We
then broke it down and we looked at the companies that are getting the most
funding on the specialty side and saw what kind of impact there was on our own
services. On the specialty side,
frankly, it's not a terrific story.
LISTNUM
1 \l 14768 I
went to Tara a little while ago and I said:
Tara, when I model Showcase in any of the three major demographics that
we are modelling, it shows a decline on Showcase of the funding that you would
have available.
LISTNUM
1 \l 14769 Similarly,
on the documentary side, History and Slice, which are participants in the
documentary funding, also showed a decline.
LISTNUM
1 \l 14770 And
worse, in both categories the prime competitor, CTV, actually showed an
increase in the modelling, or flat on the drama.
LISTNUM
1 \l 14771 So
the big gain for CanWest, from a modelling perspective, is on the conventional
side. On the specialty side, it actually
has a moderate declining impact.
LISTNUM
1 \l 14772 MS
WILLIAMS: If I could add to that, I
think one of the things that we really like about this approach is that it
actually follows the viewing patterns.
LISTNUM
1 \l 14773 We
are in a world now that is constantly changing.
Numerous intervenors have talked about the changing platforms and the
changing world around us.
LISTNUM
1 \l 14774 As
audiences shift away from one platform to another, this metric respects that
and follows it.
LISTNUM
1 \l 14775 So
that if reach changes because digital channels get more distribution and their
reach grows, then that piece of the metric grows for them.
LISTNUM
1 \l 14776 If
hours tuned changes because people start to watch more of their television on
specialty instead of conventional, then that piece of the metric changes.
LISTNUM
1 \l 14777 So
this allocation, which today the numbers suggest should be 50:50, over time,
maybe, that will shift to 60:40, 70:30 ‑‑ I don't know where
it might go. It depends where the
viewers go.
LISTNUM
1 \l 14778 But
the beauty of it is, it reflects where the viewers are. So it really supports the audience metric,
because it puts the dollars where the eyeballs are. That is how we will, ultimately, make sure
that the shows are as successful as they can be.
LISTNUM
1 \l 14779 COMMISSIONER
ARPIN: Really, the final, final
question.
LISTNUM
1 \l 14780 I
note, from the money you are currently getting, and from what you say you will
be getting, based on the adult 18 to 49 demographic, that it is more than
doubling. It is probably 2.3 or 2.5
times what you are currently getting.
LISTNUM
1 \l 14781 Would
you have enough money to issue a licence to support those?
LISTNUM
1 \l 14782 MS
WILLIAMS: Yes.
LISTNUM
1 \l 14783 COMMISSIONER
ARPIN: You wouldn't leave any money on
the table because you didn't have sufficient money to issue the initial
licence.
LISTNUM
1 \l 14784 MS
WILLIAMS: No.
LISTNUM
1 \l 14785 COMMISSIONER
ARPIN: You have figured that out
already.
LISTNUM
1 \l 14786 Thank
you very much, Madam Chair.
LISTNUM
1 \l 14787 THE
CHAIRPERSON: Thank you.
LISTNUM
1 \l 14788 I
have a couple of follow‑up questions, just so I get this straight.
LISTNUM
1 \l 14789 With
a simple and appropriate measurement tool of hours tuned to the station, does
that mean we eliminate ‑‑ or the CTF eliminates ‑‑
we know how you feel about historic access, but above‑average licence
fees and regional production as factors ‑‑ that this would be
the only factor, hours tuned to the station?
LISTNUM
1 \l 14790 MS
WILLIAMS: Our view would be that one of
the challenges to the CTF over the last number of years is that it was trying
to serve a number of different mandates.
It had a whole pile of different agendas that it was trying to serve,
and we all know that you can never be all things to all people all the time.
LISTNUM
1 \l 14791 What
we are suggesting is that we really restrict that list of agendas, and we restrict
it to ‑‑ it should still be about priority programming, it
should still be about those under‑served categories, it should still be
about getting those shows in prime time, but we would agree that, in an effort
to really ensure that audience is carrying the weight it deserves ‑‑
the audience success is carrying the weight it deserves ‑‑
that we do back off those other competing agendas of regional and above‑average
licence fees.
LISTNUM
1 \l 14792 If
the CTF thinks that above‑average licence fees are more important than
audience success, it could put it back in, but our understanding, and our
agreement, is that audience success is what we are trying to promote here.
LISTNUM
1 \l 14793 So
we are not going 100 percent to audience success. We are still protecting independent
producers, we are protecting under‑served genres, we are protecting prime
time. But, beyond that, we think
everything else should go to support the audience success model.
LISTNUM
1 \l 14794 THE
CHAIRPERSON: You have been before us, as
have other broadcasters been before us, saying that, of course, viewing is very
cyclical. This year CanWest may be up,
Global may be up, and CTV is down, and a year from now, or two years from now,
it could be the complete reverse.
LISTNUM
1 \l 14795 This
doesn't provide, therefore, a lot of stability, in terms of the amount of
funding available to you, as a broadcaster, year‑to‑year.
LISTNUM
1 \l 14796 MS
WILLIAMS: I actually would argue the
opposite. I think it provides a lot of
stability, because it is speaking to the overall success of an overall
schedule, not on a show‑by‑show basis.
LISTNUM
1 \l 14797 The
swings are: "`Falcon Beach"
didn't work so well; "The Guard" is working really well;
"Whistler" didn't work so well; "Corner Gas" is a huge hit.
LISTNUM
1 \l 14798 Those
are the swings, but the overall success of the schedule is a far more stable
measurement, and that's what hours tuned is reflective of.
LISTNUM
1 \l 14799 THE
CHAIRPERSON: But there are swings in
foreign programming, as well.
LISTNUM
1 \l 14800 MS
WILLIAMS: There are some, but, again,
over the whole schedule, it is a far less swing than when one looks at it on a
show‑by‑show analysis.
LISTNUM
1 \l 14801 I
can tell you how hard it is to really change the overall swing of prime time
from one broadcaster to another.
LISTNUM
1 \l 14802 And
the other piece of that, actually, is that, I think, the challenge with the
current formula is that it is actually quite stable, as well, because so many
of the factors are in historical and these other things that don't change. So those inequities that got established Day
1, there is very, very little opportunity for anybody to ever correct them.
LISTNUM
1 \l 14803 THE
CHAIRPERSON: And your model would
"take care" ‑‑ I guess is the term ‑‑
of differences in hours tuned year‑to‑year?
LISTNUM
1 \l 14804 In
other words, should the CTF continue to support shows that decline in numbers
from one year to the next?
LISTNUM
1 \l 14805 But,
in your model, broadcasters' numbers decline from one year to the next.
LISTNUM
1 \l 14806 MS
WILLIAMS: Yes, that's right.
LISTNUM
1 \l 14807 I
think what our formula does is, first of all, it corrects the baseline. I think that correcting anything on top of a
faulty baseline is rather pointless. We
need to first understand that the baseline is not supporting the system fairly
and in the healthiest way possible.
LISTNUM
1 \l 14808 So
our approach corrects the baseline, and then, on a go‑forward basis,
assures that the funding is relatively stable, but that, overall, when a
broadcaster does better, you get more; and does worse, you get less. And it incentifies the broadcaster to be sure
that every single hour of their schedule is performing as absolutely best it
can.
LISTNUM
1 \l 14809 Because
every hour in a schedule drives the overall success of that schedule. We don't treat them as one‑by‑one
either; we need the whole of the schedule to work. This incentifies us to make sure that every
hour is working.
LISTNUM
1 \l 14810 MS
SHIPTON: If I could add, one of the
benefits when our overall schedule is working is tremendous promotion for some
of the shows that I commission.
LISTNUM
1 \l 14811 When
our marketing people sit down and say, "We need a huge audience for ``Da
Kink' and `The Guard', where are we going to promote it," they look to
very specific places in the schedule to drive the promotion and the viewership
to those shows.
LISTNUM
1 \l 14812 So,
again, because we have a successful schedule, with successful shows, and we
know exactly who the audience is coming to each of those shows, they can market
specifically to our shows ‑‑ sorry, my shows.
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 14813 MR.
MEDLINE: Madam Chair, your original
question sort of begs another question; that is, what happened to return on
investment.
LISTNUM
1 \l 14814 I
think we should address it because it was a recommendation that it also be
considered.
LISTNUM
1 \l 14815 We,
here, are focused on audience success measures, but we also did consider return
on investment.
LISTNUM
1 \l 14816 Christine,
could you just ‑‑ I think it's important to ‑‑
LISTNUM
1 \l 14817 MS
SHIPTON: I would just say, having been
in the production community, the distribution side of the business with
Aliance, and now as a broadcaster, that it is a really tricky matrix to set up
what are the guidelines going to be about that return on investment.
LISTNUM
1 \l 14818 Is
it about foreign sales? Is it about the
potential for financial return on investment, even in Canada, post the initial
broadcast? Is it about the unregulated
media environment?
LISTNUM
1 \l 14819 There
are so many factors.
LISTNUM
1 \l 14820 I
think, in principle, it is smart to think about return on investment, because
it makes everybody remember that we are in the business of television, but we
would need lots more discussion as to the details, as to how we could all not
only live with the parameters, but follow through and track it in the years to
come, because it is something that speaks to investment that you see three and
four years out.
LISTNUM
1 \l 14821 THE
CHAIRPERSON: And this is something you
will tell us on February 18th.
LISTNUM
1 \l 14822 MR.
MEDLINE: Actually, I think we can
address it here.
LISTNUM
1 \l 14823 I
don't think we would come back on February 18th and say, "Here is how you
could work out return on investment."
LISTNUM
1 \l 14824 Christine's
list was a partial list. In the initial
draft of our opening remarks we included others ‑‑
amortization schedules have a huge impact on this.
LISTNUM
1 \l 14825 I
think we think that the intentions were right on; I think we think that the
execution would be, if not impossible, would lead us into a morass, where,
frankly, we see some similarities to some CTF rules ‑‑ rules
upon rules upon rules.
LISTNUM
1 \l 14826 THE
CHAIRPERSON: Thank you, Mr. Medline, for
that. We don't mind when you do our own
follow‑up questions, so thanks for that.
LISTNUM
1 \l 14827 I
have one final question on audience data.
Accountability and transparency has also been a theme of these
proceedings. If we were to adopt your
model, with a heavy reliance on hours tuned, can the public see what those
hours tuned are?
LISTNUM
1 \l 14828 In
other words, is CanWest willing to give up audience data, to make it publicly
available so that it can be easily tracked by us, by the Department, by the
contributors, and, more importantly, by Canadians?
LISTNUM
1 \l 14829 MR.
MEDLINE: I will take a stab at it, and
feel free to yell at me down the row.
LISTNUM
1 \l 14830 I
think, if I am not mistaken, the CTF has a similar way of reporting ‑‑
it is password protected, for instance, and the CTF can come back and say
"That's just not right" ‑‑ where data from
broadcasters that is used for their audience success to different metrics ‑‑
hours tuned by the shows that are supported by CTF funding or "CTF‑ables"
are reported and are available, but they are not open to the public.
LISTNUM
1 \l 14831 In
other words, certain people have great transparency and visibility into those
numbers, but not everyone.
LISTNUM
1 \l 14832 If
we were trying to put the numbers out to the general public, I think: (a) we wouldn't see much utility in that; and
(b) there would probably be some unforseen competitive impacts, which I can't
think of now, but probably people would tap me on the shoulder to say there
are.
LISTNUM
1 \l 14833 COMMISSIONER
ARPIN: There is an obvious one. The data belongs to BBM Nielsen and cannot be
made available unless they waive that consideration.
LISTNUM
1 \l 14834 THE
CHAIRPERSON: Would you be willing to
work with BBM to see that happen?
LISTNUM
1 \l 14835 Again,
it's accountability, it's transparency, it's being able to track how this money
is being spent.
LISTNUM
1 \l 14836 MR.
MEDLINE: Yes. I think, in this particular instance, we will
have to get back to you on February 18th.
LISTNUM
1 \l 14837 THE
CHAIRPERSON: Okay. Thank you very much, those are our questions.
LISTNUM
1 \l 14838 We
will now break for lunch and be back in one hour.
‑‑‑ Upon recessing
at 1228 / Suspension à 1228
‑‑‑ Upon resuming
at 1334 / Reprise à 1334
LISTNUM
1 \l 14839 THE
SECRETARY: Please take a seat.
LISTNUM
1 \l 14840 We
will now hear the presentation of Ryan Sutherland.
‑‑‑ Pause
LISTNUM
1 \l 14841 THE
SECRETARY: Please introduce yourself and
you have 15 minutes.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 14842 MS
GERHARDS: Good afternoon. My name is Tara Gerhards and I'll be speaking
on behalf of Ryan Sutherland who, unfortunately, is unable to attend today due
to weather and travel.
LISTNUM
1 \l 14843 MR.
GOLDMAN: My name is Aaron Goldman, I'll
be helping respond to any questions that you have of Ryan that we might be able
to respond to in his absence.
LISTNUM
1 \l 14844 MS
GERHARDS: Ryan has sent this to me to
present. It's a recommendation to
establish a CTF dispute resolution policy.
LISTNUM
1 \l 14845 The
Canadian Television Fund currently administered by Telefilm plays a vital role
in the successful production and delivery of Canadian programming.
LISTNUM
1 \l 14846 While
it is true that Telefilm adheres closely to CTF policies, guidelines and
principles, it is sometimes the policies themselves that do not equitably serve
the interests of independent production companies or the applicants and
broadcasters alike.
LISTNUM
1 \l 14847 The
current policies, particularly the default policy of the CTF, are heavily
biased in favour of the broadcaster in contrast to the spirit and intent of the
CTF which is to foster independent Canadian production.
LISTNUM
1 \l 14848 According
to the CTF guidelines, the administration of the CTF is meant to be driven by
this spirit and intent in such a way that the CTF projects are always
administered in a fashion that is in support of productions.
LISTNUM
1 \l 14849 It
is certainly important for the CTF to respect the stakeholders, broadcasters
and protect their interests. This must
not, however, be allowed to happen in a way that puts independent production
companies producing CTF projects at an unfair disadvantage.
LISTNUM
1 \l 14850 Broadcasters,
compared with independent production companies, have the advantage of longevity
and substantial leverage within the industry.
For precisely this reason it is crucially important that the CTF policies
contain mechanisms to maintain the balance and justice between the broadcasters
and the independent production companies.
LISTNUM
1 \l 14851 For
example, within the CTF policies a broadcaster could intentionally or
unintentionally cause production delays through various actions or inactions,
such as postponing contracts, delaying contractual payments or issuing
contracts that are not CTF eligible, thereby adversely affecting the financing,
production and delivery of the programming, yet still be in a position to have
the applicant, or independent production company, noted in default for a late
delivery even though that late delivery was directly precipitated by the
broadcaster.
LISTNUM
1 \l 14852 Moreover,
such a default on one project can also put into default any other CTF projects
connected to the applicant, thereby making applicants participating in one or
more projects receiving funding from the CTF in a vulnerable position relative
to broadcasters who fund only a portion of the budgets for the CTF projects.
LISTNUM
1 \l 14853 In
fact, under the current default policy it is theoretically possible for a
broadcaster in a second or a third window position on a CTF project to put all
of the projects considered to be related parties to that project into default
simply by electing to terminate their licence fee contract for any reason.
LISTNUM
1 \l 14854 Why
this above example is possible? Quite
simply, it is because the onus of the CTF default policy resides entirely on
the applicant or the independent producer and not at all on the
broadcaster. This leaves the broadcaster
in a position to apply any amount of pressure or undue influence over the
producer that it wishes, while the broadcaster remains beyond reproach from the
CTF.
LISTNUM
1 \l 14855 Clearly
this situation is out of balance.
LISTNUM
1 \l 14856 This
defence mechanism is clearly very unilaterally in favour of the broadcaster and
should instead be balanced by instigating a formalized dispute resolution
policy which mutually protects the interests of both the broadcaster and the
applicant alike.
LISTNUM
1 \l 14857 I
would humbly recommend that the CTF review and consider the extensive cases of
dispute resolution in the area of Internet domain names.
LISTNUM
1 \l 14858 This
relatively new field of media is a fast moving industry filled with extensive
competition over various intellectual property rights spanning from multi‑national
corporations to small and medium enterprises and even personal use, thereby
making this field a perfect petri dish for contemporary cases of dispute
resolution.
LISTNUM
1 \l 14859 The
Internet corporation for assigned names and numbers, ICAN, endeavour to address
the issues of domain name ownership resolution by establishing a policy that
became known as Uniform Dispute Resolution Policy. This policy was drafted in close cooperation
with the World Intellectual Property Organization, or WIPO as we call it, and
essentially attempts to provide a mechanism for rapid, inexpensive and
reasonable resolution of Internet domain name conflicts, avoiding the
traditional court system for disputes by pre‑establishing a wide variety
of rights and remedies and by allowing cases to be brought to one of a set of
bodies that can arbitrate domain name disputes.
LISTNUM
1 \l 14860 Implementing
such a policy for the CTF would certainly need to extend beyond mere
intellectual property rights or property ownership but, nonetheless, such a
dispute resolution policy would provide a mechanism to balance the respective
roles of the broadcaster and independent production companies throughout the
CTF funding process.
LISTNUM
1 \l 14861 This
policy would help further the success of the CTF towards reaching its goals to
support and foster new Canadian programming in accordance with the CTF spirit
and intent.
LISTNUM
1 \l 14862 Thank
you.
LISTNUM
1 \l 14863 THE
CHAIRPERSON: Thank you very much.
LISTNUM
1 \l 14864 I'm
going to have to ask you to repeat your names, please. I didn't get it the first time.
LISTNUM
1 \l 14865 MS
GERHARDS: Sure. My first name is Tara, T‑a‑r‑a,
and last name I'll spell it for you.
It's G‑e‑r‑h‑a‑r‑d‑s.
LISTNUM
1 \l 14866 THE
CHAIRPERSON: Gerhards and that's how it's pronounced?
LISTNUM
1 \l 14867 MS
GERHARDS: Yes.
LISTNUM
1 \l 14868 THE
CHAIRPERSON: I just like to call people
by their names, as opposed to "Hey You".
LISTNUM
1 \l 14869 MS
GERHARDS: Absolutely.
LISTNUM
1 \l 14870 MR.
GOLDMAN: My name is Aaron Goldman.
LISTNUM
1 \l 14871 THE
CHAIRPERSON: Goldman.
LISTNUM
1 \l 14872 MR.
GOLDMAN: Goldman.
LISTNUM
1 \l 14873 THE
CHAIRPERSON: Okay, thank you.
LISTNUM
1 \l 14874 MR.
GOLDMAN: You're welcome.
LISTNUM
1 \l 14875 THE
CHAIRPERSON: Is Mr. Sutherland an
independent producer?
LISTNUM
1 \l 14876 MR.
GOLDMAN: Ryan has done a small amount of
independent production. His background
is primarily in Internet, he's quite ‑‑ he's done a great deal
in the realm of media, but in terms of television his experience is rather new.
LISTNUM
1 \l 14877 He's
been spending about the last six years working with me, helping to develop a
television channel that we would intend to launch and he's been made the
President and CEO of that channel, but his experience primarily is in creating
Internet websites and multi‑media outlets.
LISTNUM
1 \l 14878 So,
that's more his background.
LISTNUM
1 \l 14879 THE
CHAIRPERSON: So, his recommendation doesn't
come necessarily out of his having experienced these kinds of delays that
you're talking about in this submission directly?
LISTNUM
1 \l 14880 MS
GERHARDS: I'm an independent producer
myself and so is Aaron. We've worked
with Ryan over the last long time, Aaron longer than myself, six months for
myself, much longer for Aaron, and Ryan has witnessed ‑‑ and
we work with other independent producers as well, so, yes, we can speak to this
from a personal level, both myself and Aaron, and Ryan can as well, even though
him being an independent producer himself is relatively new, he does have
extensive knowledge of the issues that we're talking about.
LISTNUM
1 \l 14881 THE
CHAIRPERSON: Well, Ms Gerhards, why
don't you convey to us your experience in this area.
LISTNUM
1 \l 14882 MS
GERHARDS: Ooh.
LISTNUM
1 \l 14883 MR.
GOLDMAN: There are a group of
productions over the last 12 months that have had experiences that are detailed
in here. We are endeavouring to resolve
the disputes through other avenues right now, but these theoretical examples
are things that are actually currently happening.
LISTNUM
1 \l 14884 And
we have been endeavouring to have the CTF facilitate the resolution of disputes
that have arisen out of the kinds of scenarios we've put forward.
LISTNUM
1 \l 14885 And
currently, as we understand it, the guidelines don't allow for them to help
facilitate any resolution, they're actually prohibited from interfering is the
word that they've used in our request to have them facilitate some form of
positive resolution, some constructive approach to the situations.
LISTNUM
1 \l 14886 And
it really struck us that when there's this amount of taxpayer money involved
and money that is controlled through Heritage indirectly that such a situation
could arise.
`We think it would be appropriate
for the CTF to be empowered to facilitate resolution in these situations rather
than have a broadcaster be able to, literally at whim, say, I don't feel like
it and the situation just goes down the tubes along with all the taxpayer money
that's involved.
LISTNUM
1 \l 14887 And,
more importantly, in some of these productions we're affecting two to 300
people and their livelihoods and that's of great concern to me personally.
LISTNUM
1 \l 14888 THE
CHAIRPERSON: Prior to today have you had
an opportunity to present this idea to the CTF?
LISTNUM
1 \l 14889 MS
GERHARDS: In our meetings that we've had
at the CTF and with Telefilm where we've talked about the issues that we've
been going through, and I'll give you one example for one of the companies that
I own, a production company that I own.
LISTNUM
1 \l 14890 We
were issued a contract by a broadcaster which was actually offside, it was not
in line with the CTF ‑‑ it wasn't CTF eligible when it came
right down to it and amendments, delays, dah, dah, dah, dah, on and on and on
and on, and it just dragged out.
LISTNUM
1 \l 14891 And,
of course, we have to go into production anyway and we have to finance the
productions personally and then you get to a situation where the broadcaster
says, ah, you know, it was a really good idea when we talked to you about it,
you know, six, seven months ago and we're really sorry that you spent all this
money on production, but we're not going to follow through.
LISTNUM
1 \l 14892 And
at that point what recourse the production company has is essentially court and
we're dealing with torts or we're dealing with litigation and we're dealing
with it within a judicial system which should be reserved for civil, family and
criminal matters, not necessarily this industry which could essentially police
itself.
LISTNUM
1 \l 14893 THE
CHAIRPERSON: But, in that instance, did
you enter into a development agreement with the broadcaster or an actual
licensing agreement?
LISTNUM
1 \l 14894 MS
GERHARDS: I'll let Aaron answer this
one.
LISTNUM
1 \l 14895 THE
CHAIRPERSON: Sure.
LISTNUM
1 \l 14896 MR.
GOLDMAN: The agreement was entered into
with the broadcaster. The broadcaster
sought us out to facilitate a production it desired to have occur, so, we
followed suit.
LISTNUM
1 \l 14897 They
issued a contract, monies were due within 30 days, those monies did not
arrive. The money was spent on the
production and it was a very expensive production done in hi‑def, multi‑camera,
you know, done well, media was shown to the broadcaster.
LISTNUM
1 \l 14898 The
money was delayed by over five months and the contracts themselves were not
eligible for the CTF, so, the monies that we were getting from the CTF were not
forthcoming for some time.
LISTNUM
1 \l 14899 By
the time they did come in there was an issue with the underlying rights that
had been committed to us by the broadcaster in the first place.
LISTNUM
1 \l 14900 So,
we were essentially induced to invest in this project, promised the monies by
contract, the monies weren't forthcoming, the CTF contract wasn't eligible,
therefore those monies weren't forthcoming.
LISTNUM
1 \l 14901 All
of this means that the tax credits couldn't be banked and the show was so small
it can't be banked in any case, so then we're essentially producing a $100,000
show that we had discussed with the broadcaster, moving up to a $300,000 budget
and I had taken moves toward that.
LISTNUM
1 \l 14902 I
ended up having to sell the company in order to protect against the default
policy, harming all the other projects I was involved in through the related
party clause in the default policy.
LISTNUM
1 \l 14903 Endeavoured
to be very transparent with the CTF about all the goings on and in the end,
unfortunately, the broadcaster had a lot of influence over Telefilm and all of
these projects got cracked down on, even though I had broken the related party
transactions ‑‑ or relationships and a lot of people came
really close to losing their homes over this.
LISTNUM
1 \l 14904 And
when there's a situation like that, if something goes awry between a producer,
in my case an executive producer who's asked to hire a good friend of the
broadcaster as the producer to do a show, it should never ‑‑
you should never get that far down the road where this kind of thing is
happening.
LISTNUM
1 \l 14905 So,
we're suggesting that a dispute resolution mechanism be put in place so that
something along this lines just simply can't happen, because it's a waste of
all the money involved and all the manpower involved on a show to have this
many people at Telefilm and CTF involved in a dispute over something this
small, when the broadcaster had already paid most of the monies out.
LISTNUM
1 \l 14906 It
just seems really inefficient and unnecessary and I think that if there's a
simple dispute resolution mechanism with a small group of ‑‑
you know, I wouldn't know how to suggest ‑‑ Ryan hasn't
suggested anything in terms of the structure for that party, but I'm sure the
CTF could come up with something reasonable, just to move through stuff like
this really efficiently.
LISTNUM
1 \l 14907 THE
CHAIRPERSON: And so you can concentrate
on being the creative ...
LISTNUM
1 \l 14908 MR.
GOLDMAN: And direct, which I love to do.
LISTNUM
1 \l 14909 THE
CHAIRPERSON: If my colleagues have any
further questions.
LISTNUM
1 \l 14910 Vice‑Chairman
Arpin.
LISTNUM
1 \l 14911 COMMISSIONER
ARPIN: Well, I think you have probably
said it in your last few words.
LISTNUM
1 \l 14912 That
dispute mechanism will be made up of people working for CTF or people working
for CRTC, people working for arbitrators, because there is already some
mechanism that does exist, the mediation and arbitration organization in the
commercial world who could do that.
LISTNUM
1 \l 14913 Now,
obviously your contracts have a clause I think that any dispute will be
referred to an arbitrator or whatever mechanism you choose, so...
LISTNUM
1 \l 14914 MR.
GOLDMAN: If I'm understanding where
you're coming from on this, I'm hearing a suggestion that maybe the contracts,
in order for them to be CTF eligible, might have a clause that involves
alternate dispute resolution which we would absolutely support.
LISTNUM
1 \l 14915 We
have proposed ‑‑
LISTNUM
1 \l 14916 COMMISSIONER
ARPIN: I can't say if they are currently
having an ADR clause in the contracts or not.
LISTNUM
1 \l 14917 MR.
GOLDMAN: But that might be ‑‑
LISTNUM
1 \l 14918 COMMISSIONER
ARPIN: Yes.
LISTNUM
1 \l 14919 MR.
GOLDMAN: That might be a reasonable
approach to just have it be part of the CTF requirements for a CTF eligible
project.
LISTNUM
1 \l 14920 COMMISSIONER
ARPIN: Yes, yes.
LISTNUM
1 \l 14921 MR.
GOLDMAN: That it must ‑‑
it has to go that way before. That could
simplify the administration of the CTF because it could just go to a normal
mediation process.
LISTNUM
1 \l 14922 COMMISSIONER
ARPIN: Mm‑hmm.
LISTNUM
1 \l 14923 MR.
GOLDMAN: That maybe the cost of which
might be shared equally between the parties.
LISTNUM
1 \l 14924 MS
GERHARDS: Of course I'm not speaking for
Ryan when I'm answering at this point, but a suggestion that I would have would
actually be to have an Ombuds person who sits on a board, perhaps of
independent people, independent from the CRTC, independent from the CTF and
independent from Telefilm, but answering back to them.
LISTNUM
1 \l 14925 So,
that any mediation that is facilitated through this Ombuds person, it's done
unbiasedly, so that the broadcasters don't have more representation than the
producer.
LISTNUM
1 \l 14926 Canadian
programming is essential and small producers, I'm going to boast a little bit,
are fabulous and we're very creative and we have great ideas, but we also have
limited resources.
LISTNUM
1 \l 14927 So,
when you get a show idea that a broadcaster jumps on and you run with it and
you go with it and then you get stuck, what do you do.
LISTNUM
1 \l 14928 We
need to have at least someone to go to to help facilitate the mediation, even
if it's a designated mediator saying, hey, this corporation of mediators, you
know, will help you whenever there's a requirement for an alternative dispute
resolution.
LISTNUM
1 \l 14929 And
perhaps if the CTF makes it a requirement that broadcasters' contracts or
licence fee contracts, they must now have a clause in it which provides for
alternative dispute resolution, it might be that simple.
LISTNUM
1 \l 14930 But
certainly having an Ombuds person would definitely be helpful for small independent
producers.
LISTNUM
1 \l 14931 Thanks.
LISTNUM
1 \l 14932 COMMISSIONER
ARPIN: Thank you very much.
LISTNUM
1 \l 14933 THE
CHAIRPERSON: Commissioner Morin?
LISTNUM
1 \l 14934 COMMISSIONER
MORIN: Yes. I'm wondering if there is a tendency through
the word that those mechanisms are more and more implemented and is it usually
the result of an enforcement policy, or is it done on a voluntary basis,
especially in the new media?
LISTNUM
1 \l 14935 MR.
GOLDMAN: I think that you're looking for
expertise that Ryan has, that I don't have in this arena, but reading the
papers that he's provided, it does seem to be a voluntary thing.
LISTNUM
1 \l 14936 Certainly
in terms of domain name disputes which is the model he refers to, in my own
personal experience I know that it is a voluntary thing.
LISTNUM
1 \l 14937 COMMISSIONER
MORIN: Yes.
LISTNUM
1 \l 14938 MR.
GOLDMAN: And that you could either go
the court route or you could try and work through ICAN. I've done it before, so I know that it was
really cheap and it was really fast and everybody was happy within about a
week.
LISTNUM
1 \l 14939 COMMISSIONER
MORIN: But did you observe a tendency
through the word about those mechanisms, resolution...
LISTNUM
1 \l 14940 MR.
GOLDMAN: Efficient and inexpensive and
supportive of the business interests of everyone involved. That's my experience personally.
LISTNUM
1 \l 14941 Ryan
probably would have a lot more say but, unfortunately, he's delayed.
LISTNUM
1 \l 14942 COMMISSIONER
MORIN: But it's not the result of a
policy, a public policy?
LISTNUM
1 \l 14943 MR.
GOLDMAN: I don't know the origins of
ICAN, so, unfortunately, I can't speak to it, but I gather that there were an
immense number of disputes as we've done our own research, limited, you know,
on the Internet to determine the scope of the kind of problems that we're
addressing which is between producers and broadcasters in Canada.
LISTNUM
1 \l 14944 And,
you know, a comment that was made when we first began to address this issue
with Telefilm, I said, you know, does this happen all the time? I said, you know, should I be
embarrassed? And they said, no, no, it
happens all the time.
LISTNUM
1 \l 14945 So,
it would seem that this is something that could be easily helped along by a
simple clause being required in the CTF policy that would, you know, have
broadcasters and producers try and hammer things out before things get messy.
LISTNUM
1 \l 14946 COMMISSIONER
MORIN: Thank you.
LISTNUM
1 \l 14947 THE
CHAIRPERSON: Well, thank you, Ms
Gerhards, Mr. Goldman. We don't have any
other questions for you.
LISTNUM
1 \l 14948 MS
GERHARDS: Thank you.
LISTNUM
1 \l 14949 THE
CHAIRPERSON: Madam Secretary.
LISTNUM
1 \l 14950 MR.
GOLDMAN: Thank you.
LISTNUM
1 \l 14951 THE
SECRETARY: And now we will hear the
presentation from the Comweb Group.
--- Pause
LISTNUM
1 \l 14952 MR.
BRONFMAN: I can't believe there's
actually more snow in Toronto than Ottawa.
I was driving to the airport today in Toronto, there's a lot more snow
in Toronto, but the hockey is a lot better here.
‑‑‑ Laughter
LISTNUM
1 \l 14953 MR.
BRONFMAN: Except for Tuesday night.
LISTNUM
1 \l 14954 THE
SECRETARY: Please present yourself.
LISTNUM
1 \l 14955 MR.
BRONFMAN: Yes.
LISTNUM
1 \l 14956 THE
SECRETARY: And you have 15 minutes.
LISTNUM
1 \l 14957 Thank
you.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 14958 MR.
BRONFMAN: Yes, thank you.
LISTNUM
1 \l 14959 Okay. Good morning, or should I say good afternoon,
Madam Chair, Mr. Vice‑Chairman, Commissioners. My name is Paul Bronfman and I am the
Chairman and the CEO of the Comweb Group.
LISTNUM
1 \l 14960 I
would like to begin by thanking the Commission for allowing us to speak before
you today and about a topic which is of direct interest to the Comweb Group;
namely, the Canadian Television Fund and the recommendations contained in the
CTF Task Force Report.
LISTNUM
1 \l 14961 I
am coming through loud and clear, right?
Okay.
LISTNUM
1 \l 14962 Before
I start it might be helpful to tell you a little bit about the Comweb Group and
why the CTF is important to us.
LISTNUM
1 \l 14963 The
Comweb Group is one of the world's leading production service companies. The Group is a privately owned and wholly
Canadian owned controlled company with approximately 200 employees dedicated to
supplying expert production equipment and studio services to the domestic and
international film and television industry.
LISTNUM
1 \l 14964 Next
page. Thank you.
LISTNUM
1 \l 14965 We
have offices across the country in Vancouver, Calgary, Regina, Winnipeg,
Toronto, Ottawa, Montreal and Halifax.
LISTNUM
1 \l 14966 Our
Group consists of three subsidiaries, William F. White International, Cinequip
White and Comweb Productions Inc.
LISTNUM
1 \l 14967 William
F. White is Canada's oldest production equipment service company and was
established in 1963 by William F. White.
LISTNUM
1 \l 14968 As
well, Comweb is an active partner in Toronto's new film and television
production facility film port which is a world class state‑of‑the‑art
production facility scheduled to open this April, hopefully.
LISTNUM
1 \l 14969 Comweb
is also the second largest voting shareholder of Astral Media and I serve on
the company's Board of Directors.
LISTNUM
1 \l 14970 We
were very pleased that the Commission decided to form a task force to review
the Canadian Television Fund and we were especially supportive of the
initiative to review governance of the CTF as a means of dealing with any real
or perceived cases of conflict of interest.
LISTNUM
1 \l 14971 In
this regard we note that the task force was given the mandate to investigate:
"...the most appropriate size
and structure of the CTF board as well as the most appropriate mechanisms to
deal with real or perceived conflicts of interest."
LISTNUM
1 \l 14972 MR.
BRONFMAN: And that's found on page 4 of
the task force mandate.
LISTNUM
1 \l 14973 Based
on this mandate the Comweb Group would like to share with the Commission some
of our views and concerns relating to the CTF, specifically with respect to the
issue of conflict of interest among members of the board of the CTF, please.
LISTNUM
1 \l 14974 We
would also like to present our views on what we think would be the best way to
address these concerns with the ultimate goal of course of strengthening the
CTF.
LISTNUM
1 \l 14975 So
the area of conflict of interest I would like to address. We believe that conflicts of interest whether
real or perceived are damaging, extremely damaging to the reputation of the
Canadian Television Fund, not only in the eyes of the industry but also in the
eyes of the public.
LISTNUM
1 \l 14976 In
its annual report for 2006‑2007 the CTF states on page 10 under the
heading "Mitigation of Conflict of Interest" that:
"The board chair and at least
four other board members must be fully independent of any commercial connection
with the television production or broadcasting businesses." (As read)
LISTNUM
1 \l 14977 MR.
BRONFMAN: And that's a quotation.
LISTNUM
1 \l 14978 We
believe that these guidelines have not been enforced as diligently as they
could or should have been by the CTF and its board. A simple example will help illustrate the
extent of this problem.
LISTNUM
1 \l 14979 It
is well known that the current chair of the CTF has been a veteran of the
production industry for many years and, indeed, as the president and CEO of a
production equipment service company called PS Production Services Ltd. Recently, Comweb conducted a review of CTF
funding allocations to film and television productions that received their
equipment from PS Production Services Ltd.
This review revealed that a total of 30 productions in the 2006‑2007
season were serviced by the chair's production service company, PS Production
Services, which productions ‑‑ and those productions, excuse
me, received more than $64 million in CTF funding over this timeframe.
LISTNUM
1 \l 14980 By
contrast, our company, William F. White International, which is comparable to
PS Production both in terms of its size and its line of business, provided
production services and equipment to only 12 CTF‑supplied supported
productions, totally $25 million during the 2006‑2007 season.
LISTNUM
1 \l 14981 Given
that William F. White International holds the largest share of the Canadian
production services market one would expect at a minimum, to be fair, that the
results would be roughly the same for both companies or even reversed in favour
of William F. White. Yet, the facts tell
a different story. Only a fraction of
the many productions in Canada that used our equipment in the 2006‑2007
season received CTF funding whereas one of our rivals serviced almost four
times as many productions that received CTF funding, that being PS Productions.
LISTNUM
1 \l 14982 Do
we think that this is a coincidence?
Well, it could be. It may not
be. But the fact is that the chair of
the CTF is also the President and CEO of PS Production suggests to us that
there is either a real or perceived conflict of interest at the board level.
LISTNUM
1 \l 14983 Our
detailed analysis of the CTF's funding of productions that use the services of
various production service companies is attached to our submission which
hopefully you do have or will have. In
our view, this analysis raises some very, very serious questions regarding
conflicts of interest at the CTF.
LISTNUM
1 \l 14984 However,
let me be clear. We are not arguing that
the chair has used his influence to divert funds to specific productions. Each project was approved by the board of the
CTF and external audits presumably demonstrate that these projects were awarded
fairly. But the problem is the
perception of a conflict of interest, as it relates to secondary beneficiaries
of CTF funding, is undeniable and this problem must be remedied if the CTF is
to have any real credibility in the industry and with the public at large.
LISTNUM
1 \l 14985 For
this reason the Commission must ensure that there is complete independence of
the board, the chair and the staff of the CTF.
LISTNUM
1 \l 14986 So
we have reviewed the recommendations of the CTF task force and believe that
many of these recommendations are long overdue and will be very effective if
implemented in the manner recommended by the task force.
LISTNUM
1 \l 14987 With
respect to the CTF's board of directors, there is no doubt in our minds that
real changes relating to governance and accountability at the CTF board level
are very much needed. Even the auditor
general determined in 2005 that the composition of the CTF board is a potential
source of conflict of interest. We
endorse the recommendation of the CTF task force regarding the nomination
process for the chair who would be nominated from among the independent board
members or from those members representing contributors to the Fund.
LISTNUM
1 \l 14988 We
also support the task force's recommendation number 14 to change the title of
president to president and CEO, and recommend number ‑‑
recommendation number 16, that the CTF board should clearly define the
respective role of president and CEO. We
welcome the announcement by the CTF at this hearing process that they indeed
intend to implement the recommendations by June of this year.
LISTNUM
1 \l 14989 Furthermore,
with a view to creating a more relevant, effective and accountable CTF, we
argue that the task force ‑‑ we argue with the task force that
greater emphasis should be placed on professionalism and improving the day‑to‑day
operations of the CTF. We maintain,
however, that the president and CEO, as well as the chairman, including members
of the CTF board, should be independent of any recipient of CTF funds. Only by doing so can the independence and
transparency of CTF funding decisions be guaranteed and the problems arising
from conflicts of interest, whether real or perceived, can be avoided.
LISTNUM
1 \l 14990 In
this context we agree with the recommendation set out on page 32 of the CTF
task force report and, in particular, we do endorse the recommendation 15(c) to
exclude voting privileges from a newly‑created position of president and
CEO.
LISTNUM
1 \l 14991 We
also agree with the task force recommendation that a nominating committee be
established to select new board members, a new chair and a new executive
committee.
LISTNUM
1 \l 14992 However,
we stress once again that board members and the chair should either be
representatives of contributors to the CTF or independent members that have no
financial ties or interest in the production industry. We further support the recommendation of the
task force number 13 to remove recipients of CTF funding from the board.
LISTNUM
1 \l 14993 We
would also like to see an additional condition included in this report which
would ensure that secondary beneficiaries of CTF funding; such as production
equipment, service companies and distributors be disqualified from serving on
the CTF's board.
LISTNUM
1 \l 14994 Finally,
we agree with CTF task force recommendation number 19 which would require the
CTF to publish annual reports which include a breakdown of supported production
and performance measurements for the CTF against set objectives.
LISTNUM
1 \l 14995 These
new reporting requirements would contribute to greater accountability at the
CTF and allow the public to monitor conflict of interest violations should they
arise. We are encouraged by the recent
actions by the CTF this past year and see them as a step in the right
direction.
LISTNUM
1 \l 14996 Here
is our conclusion.
LISTNUM
1 \l 14997 The
Commission has a golden opportunity here to be the advocate for significant
change and reform at the CTF. We truly
believe that the recommendations of the CTF task force will go a long way in
achieving this reform but these reforms will be ineffective if the
recommendations of the task force and CTF governance are ignored. A strengthened Canadian Television Fund
should have an independent and professional board of directors that is led by
an individual that has no financial ties to any primary or secondary
beneficiaries of CTF funding in order to avoid both real and perceived
conflicts of interest.
LISTNUM
1 \l 14998 On
behalf of my business partner, Larry Sacchetti, who is exec VP and chief
operating officer of William F. White, right over there with the goatee, on
behalf of Larry and I we would like to thank the Commission once again for
inviting us to appear before it today and for taking the time to consider our
submissions.
LISTNUM
1 \l 14999 We
would be happy to answer any questions that the Commission may have regarding
our submissions, and merci beaucoup.
Thank you very much.
LISTNUM
1 \l 15000 THE
CHAIRPERSON: Thank you, Mr. Bronfman and
Mr. Sacchetti.
LISTNUM
1 \l 15001 MR.
BRONFMAN: Thank you.
LISTNUM
1 \l 15002 THE
CHAIRPERSON: I have to say I am glad to
hear you flew in from Toronto. You give
me hope that I will be able to get home tomorrow after all.
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 15003 MR.
BRONFMAN: There is another snowstorm, I
think.
LISTNUM
1 \l 15004 THE
CHAIRPERSON: So I hear.
LISTNUM
1 \l 15005 Just
a couple of points. Recently, I think
about 10 days ‑‑ about 10 or 12 days ago, the CTF did make
available a new document and we posted it on our website which clearly defines
the role of the chair and the president.
Have you had an opportunity to read that document?
LISTNUM
1 \l 15006 MR.
BRONFMAN: I have read part of it but I
really think still that I would reinforce what I said. I really think that if the chair and other
members of the board have any ties primarily or to secondary CTF funding, I
think that the perceived conflict of interest will continue to be a problem
regardless of those guidelines.
LISTNUM
1 \l 15007 THE
CHAIRPERSON: Okay, thank you.
LISTNUM
1 \l 15008 Now,
I do admit this is an area that I don't know a lot about. Is there a bidding process that goes on
between you and PS? I mean, let's use
these two as an example. When you know
there is a production going on in the city do you bid for that work, for them
to use your facilities?
LISTNUM
1 \l 15009 MR.
BRONFMAN: Usually. But oftentimes, sometimes there is not
because again there is a ‑‑ there is an intimidation factor
there. And we have had feedback from
many producers from Halifax to Vancouver and all points in between that
producers sometimes will not bid out the shows.
They will automatically go to PS Production because they are intimidated
by the fact ‑‑ and again it's perception sometimes that is
greater than reality ‑‑ they are intimidated by the fact that
if they don't use PS Production Services for their production equipment they
may not get CTF funding.
LISTNUM
1 \l 15010 THE
CHAIRPERSON: Or it may just be their own
perception?
LISTNUM
1 \l 15011 MR.
BRONFMAN: Exactly.
LISTNUM
1 \l 15012 THE
CHAIRPERSON: Okay.
LISTNUM
1 \l 15013 Were
you able to do an analysis prior to the current CTF chair being the chair and
whether or not this difference in percentage of jobs that go to PS versus
William F. White is the same or different or greater?
LISTNUM
1 \l 15014 MR.
BRONFMAN: I actually did the last two
years. We could do more but we just did
the last two years.
LISTNUM
1 \l 15015 THE
CHAIRPERSON: Okay.
LISTNUM
1 \l 15016 On
page 6 ‑‑ no, I'm sorry.
On page 5 of your oral presentation you said that:
"Each project was approved by
the board of the CTF and external audits presumably demonstrate that these
projects were awarded fairly." (As
read)
LISTNUM
1 \l 15017 THE
CHAIRPERSON: We heard on Monday that in
fact it is not the board who decides on which project gets funded but rather
its ‑‑ you know, the producer will go to the broadcaster for a
licence fee and then the broadcaster submits or the producer will submit the
application to the CTF and that the board is not involved at all in deciding
who gets funded.
LISTNUM
1 \l 15018 Do
you have different information that tells us that the board decides the
projects?
LISTNUM
1 \l 15019 MR.
BRONFMAN: I probably don't, but what I
truly believe is that there is real problem out there in our industry for
perceived conflict of interest and the intimidation factor of having to use one
particular company over another because they are afraid they may not get their
funding at the CTF level because the chair of a company has a dual role.
LISTNUM
1 \l 15020 THE
CHAIRPERSON: And regardless, that's the
bottom line.
LISTNUM
1 \l 15021 MR.
BRONFMAN: Yes, yes.
LISTNUM
1 \l 15022 THE
CHAIRPERSON: Well, thank you very much,
Mr. Bronfman.
LISTNUM
1 \l 15023 MR.
BRONFMAN: Thank you.
LISTNUM
1 \l 15024 THE
CHAIRPERSON: My colleagues, Vice‑Chairman
Arpin.
LISTNUM
1 \l 15025 COMMISSIONER
ARPIN: Thank you.
LISTNUM
1 \l 15026 Mr.
Bronfman ‑‑
LISTNUM
1 \l 15027 MR.
BRONFMAN: Sir.
LISTNUM
1 \l 15028 COMMISSIONER
ARPIN: ‑‑ in your oral presentation ‑‑ I am
going to page 7, and at the end of the second paragraph you say that:
"...to ensure that the
secondary beneficiaries of CTF funding..."
(As read)
LISTNUM
1 \l 15029 COMMISSIONER
ARPIN: And you have dealt with prior
beneficiaries before:
"...be disqualified for serving
on the CTF board." (As read)
LISTNUM
1 \l 15030 COMMISSIONER
ARPIN: Where do you put the broadcasters
that are on the board of the CTF?
LISTNUM
1 \l 15031 MR.
BRONFMAN: I think the broadcasters
probably have a right to be on the board ‑‑ and this is not
with my Astral Media hat on; this is with my Comweb group hat on ‑‑
because they are the funding source. So
I don't have an issue with broadcasters.
LISTNUM
1 \l 15032 COMMISSIONER
ARPIN: Now, the distributors, the cable
and the satellite are the contributors.
The broadcasters, because we have been told by a few intervenors so far
that the broadcasters are also beneficiaries to their affiliated company ‑‑
LISTNUM
1 \l 15033 MR.
BRONFMAN: Right.
LISTNUM
1 \l 15034 COMMISSIONER
ARPIN: ‑‑ when they do have an affiliated company and the
major ones all have an affiliated company and they are ‑‑ and
since also they are triggering the call for programming because they are given
the envelope, the broadcasting envelope, then they are the primary; even
beneficiaries of the Fund.
LISTNUM
1 \l 15035 So
that's why I am asking you where you put the broadcasters in your ‑‑
from a governance standpoint where do you put the broadcast in this array?
LISTNUM
1 \l 15036 MR.
BRONFMAN: I still think the broadcasters
have a right to be on the board. I mean,
maybe I'm maybe a bit softer on the broadcasters and some of my other
colleagues in the production industry.
But I wouldn't have an issue with the broadcasters being on the board.
LISTNUM
1 \l 15037 COMMISSIONER
ARPIN: Okay.
LISTNUM
1 \l 15038 MR.
BRONFMAN: As long as it's not dominated
by the broadcasters.
LISTNUM
1 \l 15039 COMMISSIONER
ARPIN: It is not.
LISTNUM
1 \l 15040 MR.
BRONFMAN: Exactly.
LISTNUM
1 \l 15041 COMMISSIONER
ARPIN: To my knowledge.
LISTNUM
1 \l 15042 MR.
BRONFMAN: Right, me too.
LISTNUM
1 \l 15043 COMMISSIONER
ARPIN: Okay. Thank you very much, Mr. Bronfman.
LISTNUM
1 \l 15044 MR.
BRONFMAN: Merci. Thank you.
LISTNUM
1 \l 15045 THE
CHAIRPERSON: Commissioner Morin.
LISTNUM
1 \l 15046 COMMISSIONER
MORIN: Mr. Bronfman, is it the first
time that you are seeing page 3 and 4, that you are seeing those things
publicly?
LISTNUM
1 \l 15047 MR.
BRONFMAN: Yes, it is.
LISTNUM
1 \l 15048 COMMISSIONER
MORIN: It is. So in the past have you ‑‑
did you ask some questions to the CTF board?
Did you ask ‑‑ did you say those facts? I presume they know but ‑‑
LISTNUM
1 \l 15049 MR.
BRONFMAN: I did not and, you know, it's
a bit of a quandary here because, you know, as a company we do support the CTF
board ‑‑ the CTF.
LISTNUM
1 \l 15050 COMMISSIONER
MORIN: The CTF.
LISTNUM
1 \l 15051 MR.
BRONFMAN: And you know we would not want
to be viewed by our clients across the country that somehow we were casting
negative opinions on the CTF because many of our clients receive funding from
the CTF.
LISTNUM
1 \l 15052 So
the long answer is, yes, this is my first time raising it publicly. And as I said before, producers across the
country will not go on record but they have told us many times on the QT, and
they do not want to be named, that they feel intimidated by not using PS
Production Services.
LISTNUM
1 \l 15053 COMMISSIONER
MORIN: So even in an informal way, you
didn't try to inform some members of those facts?
LISTNUM
1 \l 15054 MR.
BRONFMAN: I did not. I was more comfortable doing it in a public
forum.
LISTNUM
1 \l 15055 COMMISSIONER
MORIN: Thank you.
LISTNUM
1 \l 15056 MR.
BRONFMAN: Merci.
LISTNUM
1 \l 15057 THE
CHAIRPERSON: Well, thank you very much,
Mr. Bronfman, for your contribution and safe travels home.
LISTNUM
1 \l 15058 MR.
BRONFMAN: Thank you for having us.
LISTNUM
1 \l 15059 THE
CHAIRPERSON: Thank you.
LISTNUM
1 \l 15060 MR.
BRONFMAN: Thank you.
LISTNUM
1 \l 15061 THE
CHAIRPERSON: We will take a 10‑minute
break.
LISTNUM
1 \l 15062 MR.
BRONFMAN: Thank you.
‑‑‑ Upon recessing
at 1420 / Suspension à 1420
‑‑‑ Upon resuming
at 1429 / Reprise à 1429
LISTNUM
1 \l 15063 THE
SECRETARY: Please take a seat.
LISTNUM
1 \l 15064 We
will start with the presentation of Bell Broadcast and New Media Fund. Please introduce yourself and you have 15
minutes.
LISTNUM
1 \l 15065 Thank
you.
PRESENTATION / PRESENTATION
LISTNUM
1 \l 15066 MS
SHEFFER: Good afternoon, Madam Chair,
Members of the panel, Commission staff, Mesdames et messieurs. Je suis Andra Sheffer et je suis la directrice générale du fonds
indépendant de production du fonds Bell et du fonds Cogeco.
LISTNUM
1 \l 15067 I
am here today to share with you our experiences with these three funds in the
hopes that it can inform you in your deliberations on the Canadian Television
Fund.
LISTNUM
1 \l 15068 These
funds may provide certain models as they have operated successfully and
efficiently for 16 years in both English and in French and they have the strong
support of their BDU contributors.
LISTNUM
1 \l 15069 All
three of the funds that I represent have been certified by the Commission as
independent production funds qualified to receive and administer up to 20
percent of a BDU's contribution to Canadian programming. They each have their own mandates and their own
separate boards of directors but they share common administrative services and
offices.
LISTNUM
1 \l 15070 The
IPF was originally created in 1991 as the MacLean Hunter Television Fund with
an endowment of $29.2 million which has now grown to $37 million. It now also receives BDU contributions from
Mountain Cablevision Ltd., its interests on the endowment, the BDU
contributions and revenues from recoupment of equity investments. These are the three sources of revenues which
allow the IPF to make equity investments in Canadian primetime adult drama
series and children's drama series each year for private broadcasters.
LISTNUM
1 \l 15071 The
IPF has a seven‑member board made up of individuals with industry
expertise. This board reviews the
applications and the evaluator's staff recommendations and makes funding
decisions three times per year based on creative, financial, business and
marketing aspects of each project.
LISTNUM
1 \l 15072 The
IPF makes equity investments in an average of 14 projects per year or
approximately $2.5 million. The IPF also
administers the other funds by providing office and staff services under
contract to them.
LISTNUM
1 \l 15073 The
COGECO Fund finances the development of drama series and movies of the week,
provides equity investments for movies of the week and pilots for series and
provides corporate loans to companies developing feature films.
LISTNUM
1 \l 15074 The
COGECO Fund was established in 1992 with a $5 million endowment which is now
valued at $6 million and also received BDU contributions of approximately $2
million per year from COGECO Cable. It
has a small board of six directors with industry expertise. One‑third of these directors represent
the BDU contributor.
LISTNUM
1 \l 15075 A
committee of the board reviews all of the applications three times a year and
recommends to the board which projects should be funded. Recommendations again are subjective as they
are based on evaluator analyses, creative and business aspects of each project.
LISTNUM
1 \l 15076 The
COGECO Fund supports an average of 30 projects per year in development and
approximately 10 per year in production totalling about $2.5 million.
LISTNUM
1 \l 15077 The
Bell Fund advances the Canadian broadcasting system by funding the development
and production of new media associated with Canadian television productions. It was established in 1997 by Bell Canada and
since 1999 it has been receiving from Bell ExpressVu a percentage of their
required BDU contributions which is estimated to reach $10 million this year.
LISTNUM
1 \l 15078 The
Bell Fund also operates a $10 million endowment resulting from the BCE‑CTV
benefits. The income generated by this
endowment specifically funds development of new media projects.
LISTNUM
1 \l 15079 The
Bell Fund has a nine‑person board made up of industry executives
including three from the Bell family.
This Board makes objective funding decisions based on evaluator
recommendations. Unlike the other funds,
the Bell Fund's investments are non‑recouperable grants to help encourage
the development of leading‑edge new media projects, new business models
and industry growth. The Bell Fund
supported 35 projects in production last year and 26 in development.
LISTNUM
1 \l 15080 Over
the years our three funds and five fulltime and two part‑time staff in
offices in Toronto and Montreal have learned a few things related to issues
that the Commission is addressing in this hearing. I hope that you can find our experiences
illuminating.
LISTNUM
1 \l 15081 First,
about board structure and governance: A
small board of industry experts representing various aspects of the industry
has been very effective. Our boards
range in size from six to nine individuals.
These boards operate at arms‑length from their BDU
contributors. We have conflict of
interest guidelines that are regularly used without incident. Industry expertise allows the board to
actively direct policy as well as make subjective and knowledgeable funding
decisions. Board members are frequently
a resource for the staff, providing advice and guidance.
LISTNUM
1 \l 15082 The
Bell Fund board is a good example of a board that is representative of its
stakeholders. One of its members is a
representative of a Bell ExpressVu, the BDU contributor, the other two from the
Bell family. Its other members represent
various aspects of the industry and they are from multimedia training, digital
production, interactive advertising, broadcasting, new media technologies,
consulting.
LISTNUM
1 \l 15083 As
established in its bylaws, the BDU contributor is the only member of the
fund. As a member it is entitled to
nominate and elect the directors of the board.
Typically, the member seeks the advice of the industry and incumbent
directors in determining the composition of board directors. This has proven to be a very effective
process providing the BDU with input on board composition while ensuring that
the industry is also well represented.
LISTNUM
1 \l 15084 This
Bell Fund board model in particular wherein contributors form one‑third
of board directors and have the responsibility to elect the other board members
in consultation with the industry, is a variation on the task force
proposal. It has worked very well for
the Bell Fund and is a model to be considered.
LISTNUM
1 \l 15085 All
our board members act in the best interests of the funds that they are participating
on and they act independently of any association interests. As funded administrators we look to the
boards for policy direction and funding decisions. However, all day‑to‑day
management of all activities of these funds is undertaken by the management and
the staff.
LISTNUM
1 \l 15086 As
administrators we also ensure that our contributors are happy. Not only are they represented on the board,
but the funds and therefore their corporate names appear on the credits of all
productions they support. We ensure that
they are invited to participate at public and promotional events and to meet
with the producers and the talents that they support. They receive recognition in all of our
promotional and information materials and at all events in which the funds
participate. They are informed of
broadcasts of their productions and of award and kudos and critical acclaim
that their productions receive.
LISTNUM
1 \l 15087 We
make every effort to make them proud of their fund and to feel that their
contributions are making a difference.
Even though these contributions are required, their buy‑in to
these funds have been essential to their success. This ability and credit can go a long way in
building satisfaction.
LISTNUM
1 \l 15088 Second,
audience success: Every project
submitted to us thinks it is market oriented in some way. Each has hopeful estimates for audiences and
traffic numbers and most have dutifully calculated and well‑informed
projections of significant revenues.
LISTNUM
1 \l 15089 Potential
audience size is not the primary criteria when making funding decisions at
these funds. A statistical measure of
absolute audience numbers is indeed subject to a range of external factors
which impact on the audience size.
LISTNUM
1 \l 15090 Therefore,
the focus for funding decisions by all of these funds is on excellence and high
quality productions which is a result of subjective analysis.
LISTNUM
1 \l 15091 Popular
shows such as reality shows do not necessarily meet the criteria of
quality. Our funds have the luxury of
subjective analyses given the volume of applications they review each
year. They can look at the broader
picture beyond the first telecast in Canada to the audience it is intended to
serve, to the international impact and to the impact on the production company
and the talents involved.
LISTNUM
1 \l 15092 Their
first concern is the creative material.
Is it good? Is the team of
producers and creative personnel and crew likely to produce a high quality
production? Is the budget appropriate
and sufficient to fulfil the creative vision?
LISTNUM
1 \l 15093 Broadcasters
make these same analyses on these projects in order to select those they wish
to licence which in turn ensure that the projects are eligible to apply to the
funds and to the CTF. However, together
with our team of external evaluators, we also conduct our own creative due
diligence. We do this primarily because
with limited funds we cannot fund everything that broadcasters want to air. We can only fund what we consider in our
subjective analysis to be the best.
LISTNUM
1 \l 15094 The
funds also conduct further reviews of the project, the financing plan, the
business plan; the marketing and promotion plan. These are issues that broadcasters have
differing levels of interest in. As an
equity investor our funds must conduct this level of analysis to determine if
there is likelihood of the investment being recouped.
LISTNUM
1 \l 15095 Therefore,
audiences internationally and potential sales revenues internationally are
important evaluation factors as is in fact the merchandising potential of toys
and other ancillary rights.
LISTNUM
1 \l 15096 Potential
audiences in Canada are only part of the measure. Projects may be approved for funding although
they are designed for small, specific niche audiences. But they are high quality and they expect to
be well received by that niche audience.
LISTNUM
1 \l 15097 Different
criteria are used for projects destined for the English and the French‑language
markets and for different genres. There
are many influencing factors as every project has its own relevant measures for
success. Only knowledgeable, subjective
analyses can assist making these funding decisions and even then no one knows
for sure.
LISTNUM
1 \l 15098 Projects
with a minimum of 8 out of 10 for Canadian content are eligible at these funds
as per the CRTC regulations governing certified independent production
funds. Although the vast majority of the
projects we fund do have 10 points for Canadian production talent, the
flexibility to use non‑Canadian skills has been deemed important on
occasion by several producers and broadcasters for various sales and
promotional reasons and some of these projects were approved for funding.
LISTNUM
1 \l 15099 The
reality of Canadian television is that we often do attract sizeable audiences
in Canada and we also have commercial successes with productions that sell
internationally to 175 countries.
However, even then the revenues generated rarely cover the costs of high
quality production.
LISTNUM
1 \l 15100 Now,
new media financing: The Bell Fund has
been at the forefront of cross‑platform new media television production
for the past 10 years. It has invested
over $57 million to build this industry in Canada. There is no question that the new media industry
could certainly use additional funding to grow and maintain the competitive
edge that has been established. The Bell
Fund cannot fund all of the high quality applications it reviews each year,
even given its present niche mandate which is limited to supporting original interactive
projects associated with television programs.
LISTNUM
1 \l 15101 It
is important to clarify that the Bell Fund projects are original, interactive
content designed specifically for alternate platforms such as websites and
mobile devices. This is only a small
subset of the digital media being created in Canada. It does not, for example, include linear
programming created for VOD or pay‑per‑view broadcast or
interactive digital projects not associated with a particular television
program.
LISTNUM
1 \l 15102 Broadcasters
and new media producers also lack the resources to produce rich, engaging,
original content designed for alternate platforms that may or may not be
specifically linked to a particular television program or may be a standalone
production. Such projects may, though,
be eligible for support from Teleflex's Canada New Media Fund, funded through
the Department of Heritage, but again the annual funding available is not
sufficient to meet the demand.
LISTNUM
1 \l 15103 Revenues
generated by cross‑platform productions are still minimal and
expectations of full recoupment and profit are unrealistic in most cases but
they are growing. Like the Canadian
dramatic television industry where recoupment is 13 percent on the dollar is
the average, this is a cultural industry that must be subsidized at least in
the short term.
LISTNUM
1 \l 15104 Our
funds support the test for recommendation to amend the CRTC regulations
regarding BDU‑certified independent production funds to allow for the
flexibility to finance projects designed for new media platforms. This would provide an option for interesting
new alternative funding sources for this industry sector.
LISTNUM
1 \l 15105 Diversity: All of our funds believe that it is essential
for the good functioning of the Canadian broadcast industry that the producers
have alternative and complementary sources of funding for their projects. Whether evaluations are objective or
subjective, projects may not be awarded funding from a particular source for
various reasons.
LISTNUM
1 \l 15106 Multiple
funders provide alternative and complementary perspectives and operate with
different funding objectives. Each of
our funds has developed a focused expertise in the genre that they represent
and this specialization has been valuable both to the decision making process
and to the recipients. Given their
structure they can be flexible and adapt quickly to address industry
needs. Accessibility and close communications
with producers allow different insights to be developed.
LISTNUM
1 \l 15107 The
funds provide leadership and undertake to pro‑actively assist the
production community. No one funding
body can be expected to satisfy all of the needs of this complex industry.
LISTNUM
1 \l 15108 The
IPF, the COGECO Fund and the Bell Fund all believe that Canadian programming
must be supported. These funds provide
opportunities and models that could be adapted by the Canadian Television Fund,
a fund which is one of the various tools available to our industry. Changes to any one part of the complex
funding system will impact us all. All
funding partners must work together to maximize the success of our industry.
LISTNUM
1 \l 15109 We
would be pleased to answer any questions.
Thank you.
LISTNUM
1 \l 15110 THE
SECRETARY: Thank you.
LISTNUM
1 \l 15111 Now,
we will hear the presentation of Shaw Rocket Fund.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 15112 MS
AUGUSTIN: Good afternoon, Madam Chair,
Members of the panel, Commission staff, ladies and gentlemen.
LISTNUM
1 \l 15113 I
am Agnes Augustin. I am President of the
Shaw Rocket Fund.
LISTNUM
1 \l 15114 The
Shaw Rocket Fund receives BDU contributions from Shaw Communications, Star
Choice, EastLink Cable Systems and Delta Cable.
LISTNUM
1 \l 15115 When
we think of our children, my kids, your children, our grandchildren, how can we
not think about who they will become and how they will shape the world we live
in? We strive to give our children the
best in hopes that they will have what they will need to become successful
adults with Canadian values and sensibilities.
LISTNUM
1 \l 15116 Children
are the future and this is especially true when it comes to media. The other day, my 12‑year‑old
downloaded songs onto my friend's mobile phone to the Bluetooth capability
without instruction or a manual, just picked it up and did it. At our dance studio the kids are watching
downloaded programming on their iPod touch, it is amazing what is happening
right now.
LISTNUM
1 \l 15117 And
this is just the beginning. Children are
shaping the future for everyone at a rapid pace. And in order to be effective we, as
supporters of quality content, need to be there for them or they will look
elsewhere and what they will find will likely not be Canadian.
LISTNUM
1 \l 15118 Everything
that the Shaw Rocket Fund does stems from one mandate, how do we best serve
Canadian children, our audience? This
hearing on the Canadian Television Fund provides an opportunity to review how
we as an industry support the Canadian audience and what we can do to ensure
that now and in the future we are giving the audience what they want to see and
when they want to see it.
LISTNUM
1 \l 15119 We
would like to address the following three points regarding this review of the
Canadian Television Fund; we would like to discuss the audience, a new model
for the industry, and the Shaw Rocket Fund as an example.
LISTNUM
1 \l 15120 When
we look at the audience we think it is quite straightforward. We need to give Canadians programming that
they want to see, that showcases Canadian values and sensibilities wherever and
whenever they want to see it, and this is especially true for our children.
LISTNUM
1 \l 15121 We
at the Shaw Rocket Fund believe that Canadians like being Canadian and like
Canadian programming, adults and children alike.
LISTNUM
1 \l 15122 And
even though American programming dominates in English‑Canada, we believe
that Canadians want to see themselves in the stories being told. And this is most important for our children
who are very influential and need to see diversity of voices that reflect who
we are as a country?
LISTNUM
1 \l 15123 The
CTF has made changes to become more market driven, as broadcasters determine
what is financed through the CTF and audience measures are in place. And, in theory, this should all work. But in an environment where foreign program
acquisitions cost less than original Canadian programming and draw more
advertising revenue, the condition of licence to air Canadian programming can
sometimes become just that, a condition of licence.
LISTNUM
1 \l 15124 When
looking at the CTF statistics in the 2006/2007 annual report, 58 per cent of
the total CTF funding went to dramatic programming, yet these programs drew
only 4 per cent viewership. In contrast,
only 18 per cent of the CTF funds were allocated to kids programming, that is
40 per cent less than the allocation to drama. Also surprising, is that of the
CBC's 37 per cent allocation of CTF funds only 11 per cent was spent on kids
programs.
LISTNUM
1 \l 15125 When
it comes to children's programming, we have been told by the CTF that their support
is in line with the percentage of total viewership by Canadian kids. Although this may be true, the statistics
include non‑priority programming of news, sports, reality and from both
foreign and Canadian sources. We would
expect the overall viewership to be less, my children don't watch the 11:00
news.
LISTNUM
1 \l 15126 More
appropriate, perhaps, is to look at the viewership of Canadian programs in the
genres supported by the CTF. In the
2006/2007 CTF annual report it states:
"CTF‑funded programs in
the children and youth genre derive the largest proportional share of all
viewing, 42 per cent to Canadian programs among the four genres supported by
the CTF." (As Read)
LISTNUM
1 \l 15127 We
are strangely in an environment where children viewers are lumped into a genre
category rather than being considered an actual sector of our Canadian
audience. Producers of children's
content continue to have to compete against dramatic programming dollars and
can continue to lose out. It is most
shocking that children's programming is considered less of a priority in the
Canadian broadcasting system when it shapes our children's views, and it has
proven to be one of our country's best success stories.
LISTNUM
1 \l 15128 The
CTF statistics continue to speak for themselves. CTF funding for kids was the lowest of CTF
genres at 22.5 per cent of all budgets, as well as having the lowest
broadcaster licences in all genres at 30.2 per cent. The difference was made up with higher
distribution advances showing the strength of kids programming in the
marketplace and, not surprising, the highest support by private funds, like the
Shaw Rocket Fund.
LISTNUM
1 \l 15129 We
at the Shaw Rocket Fund have worked diligently over the past years to
financially support the best children's programs Canadians have to offer, to
support these programs in the marketplace and to heighten the profile of our
Canadian programming nationally and internationally, to ensure that desirable
Canadian programs are available to Canadian kids.
LISTNUM
1 \l 15130 But
we can't do this alone. All stakeholders
need to truly buy into the importance of programming for Canadian kids;
broadcasters, including OTAs, producers, BDUs, government, and of course the
Canadian Television Fund. As the Shaw
Rocket Fund discussed at the OTA hearing in November, 2006, we strongly believe
that it is the responsibility of all stakeholders to give Canadian kids access
to great Canadian programming. This is
not about genre allocation, this is about giving our children Canadian content
that positively affects their lives.
LISTNUM
1 \l 15131 Where,
how and what Canadian children watch today will be carried into their adult
years and we all need to be prepared.
Programming for children must become a priority for the Canadian
Television Fund.
LISTNUM
1 \l 15132 And
this leads us to our second point, looking at a new model for the
industry. In this brave new world of
multiplatform delivery it is impossible to build an industry by tweaking
outmoded regulations. We at the Shaw
Rocket Fund believe that in this review of the CTF there is an opportunity for
dramatic change with one clear goal in mind, the audience. What do Canadians want to watch and how do we
best get it to them, when they want to see it and how they want to see it.
LISTNUM
1 \l 15133 Although,
it may appear to be obvious when we say that kids are the future, we believe
this is especially true when it comes to business of media. Kids' viewing patterns are setting everyone's
path to the future and lessons can be learned from our kids and from the
business of children's production.
LISTNUM
1 \l 15134 We
also believe that the Canadian TV industry model needs to return to the basic
Canadian value of fairness in the marketplace.
If the industry is to grow and develop all participants deserve a chance
to benefit from the creation of a world‑class product. With developing platforms the issues of
rights becomes very critical for all parties.
LISTNUM
1 \l 15135 Broadcasters,
from what we can see in children's programming, want more rights in order to
remain competitive which, in my instances, affect producers' rights and the
rights of the funds. Fairness in the
marketplace will ensure that there is a healthy industry that will continue to
make great, relative, innovative programming for Canadians.
LISTNUM
1 \l 15136 The
new model must support independent companies to produce content that reflects
Canadians to the world while being given a fighting chance to grow and
develop. The private funds are a simple
and successful model created by the CRTC and we urge the Commission to consider
these funds when reviewing the Canadian Television Fund.
LISTNUM
1 \l 15137 The
Shaw Rocket Fund has much to offer with its structure and business
practices. We have been successful at
supporting high‑quality Canadian programming that Canadian children watch
and that sells internationally. We
champion the creators of our Canadian programming, we support broadcasters
through our production funding, and we have been able to create a sense of
pride for our BDU contributors. The Shaw
Rocket Fund is a well‑established and successful model of private sector
funding.
LISTNUM
1 \l 15138 We,
like the other private funds, as Andra went through, follow simple essential
criteria outlined in the CRTC public notice 1997/1998. More specifically, the Shaw Rocket Fund is
based on the following structure. We
have a non‑stakeholder board, members are knowledgeable, our work is
transparent, our goals, objectives and criteria for decision making are
clear. Our start and end point is our
audience, Canadian kids, this provides a clear focus.
LISTNUM
1 \l 15139 We
invest based on quality and not quotas.
We constantly assess our results, our effectiveness and that of our
producers. We take steps to keep current
with our audience and the industry and plan for the fund based on tomorrow, not
yesterday. And we take into
consideration all of our stakeholders; children, the producers, our BDU
contributors, regulators, and the industry as a whole.
LISTNUM
1 \l 15140 The
focus of the Shaw Rocket Fund is simple, the decisions we make must be to the
benefit of our audience, Canadian children.
This is relevant even when protecting rights and promoting good business
practices and this enables a healthy industry that will produce more great
Canadian programs for our kids and all stakeholders benefit as a result.
LISTNUM
1 \l 15141 The
Shaw Rocket Fund board and management recently completed at two‑day
workshop with influential producers and leaders in youth communications to
review what is happening in media today with kids. And during this session, one producer was
quoted as say, "It used to be Telefilm that determined the program's
viability in a marketplace, and now it is the Shaw Rocket Fund." If the Rocket Fund is attached, our partners
know it is a good program.
LISTNUM
1 \l 15142 We
urge the Commission to consider the impact that the Shaw Rocket Fund has had on
the Canadian children's programming sector.
We invest approximately $10 million per year, which is just over 3 per
cent of the CTF budget and, yet, we have had much success in promoting and
supporting the best of Canadian programming across the country and abroad.
LISTNUM
1 \l 15143 At
this time, we would like to revisit two primary requests put forward by the
Shaw Rocket Fund at the OTA hearing, as well as through our recent
correspondence with the Commission.
LISTNUM
1 \l 15144 We
would like to see an increase to Shaw's BDU contribution to the Shaw Rocket
Fund. We request an increase to 1 per
cent up from the current .6 per cent of the 3 per cent allocation to
independent production funds in support of children's programming. This would allow the fund to support an
additional 10 to 15 programs and new media projects per year and would only
have a 1 per cent effect on the CTF.
LISTNUM
1 \l 15145 Number
two, would be the ability for the fund to support new media productions without
a broadcast licence. This would be in
addition to supporting traditional broadcast productions. We would like to be able to finance content
for kids where it is best suited and being watched on various platforms.
LISTNUM
1 \l 15146 The
Shaw Rocket Fund is capable of doing more and these two requests would enable
the fund to be proactive in this new world with additional resources to
continue to support and be the champion of Canadian content for our kids
wherever and whenever they are watching it.
LISTNUM
1 \l 15147 In
closing, we would like to say that we are partners in this exciting industry
with media and the Shaw Rocket Fund would like to work with all stakeholders so
that we can collectively make the best programming that the Canadian audience
wants and to ensure that Canadian children are a priority in everything that we
do.
LISTNUM
1 \l 15148 We
thank the Commission for the opportunity to present at this hearing and welcome
any questions.
LISTNUM
1 \l 15149 THE
CHAIRPERSON: Thank you, Ms Augustin and
Ms Sheffer.
LISTNUM
1 \l 15150 Commissioner
Morin.
LISTNUM
1 \l 15151 COMMISSIONER
MORIN: Yes, good afternoon. I would like to ask some questions to Bell
and Cogeco media fund. Contrary to many
interveners here, you fully support the principle of a new fund or a new
envelope for new media. You applaud the
idea of a new media fund financed by the CTF.
LISTNUM
1 \l 15152 But
under the current proposal these new projects would be financed by an old
system, as you know, that is already overburdened. Many actors here believe
that it is a recipe for disaster. You
don't agree, I understand, and you expect the worst if we do nothing as far as
the new media are concerned.
LISTNUM
1 \l 15153 MS
SHEFFER: That was in our original
submission to you and there has been a lot of thought and debate about it ever
since, I have to admit. There is no
question that we need new money in the system or we need money in the system
somehow for new media. It is an
important new platform where our culture is being disseminated and it is
absolutely essential that we find the money somewhere.
LISTNUM
1 \l 15154 But
the discussion has been around all of these new variations on what the CTF
could potentially become or what it would change or wouldn't change. And it is a question of whether Telefilm's
new media fund is already serving that purpose, welling the Bell fund is
already serving that purpose, whether it is a role for the CTF, because it is
entire a new world and the CTF does have its hands full with Canadian broadcast
programming. So, although we are very
concerned that there actually be a lot of consideration given to the new media
support, there is certainly no consensus on where that support should come
from.
LISTNUM
1 \l 15155 COMMISSIONER
MORIN: The task force has said that an
ideal board ought to be composed of five independent members. You also agree with the recommendation that
the CTF board be smaller, and you gave your example, than it is presently. Do you think that a smaller board would be
more effective even at the cost of the valuable expertise a larger board
provides like the CTF? For example, as
you know, the CTF has a board of 15 plus administrators.
LISTNUM
1 \l 15156 MS
SHEFFER: I can assure that with all of
our experiences the small boards have been very effective. We have never felt that we don't have the
representation that we need. If there
were particular issues that needed further consultation, we would do so and be
able to go out into the industry and consult with whoever we needed to consult.
LISTNUM
1 \l 15157 The
boards we have are not independent in the sense that everyone of them on the
board is in someway related to the industry and have ‑‑ they
are all senior executives in the industry, so they have a broad range of
experience within the industry. So when
they come to the board they are bringing a lot of different perspectives. And it has been working very well.
LISTNUM
1 \l 15158 They
are representing no one but their own knowledge. There aren't conflicts of interest and we
have the advantage that they are industry experts rather than independents who
really don't know anything about the industry.
LISTNUM
1 \l 15159 COMMISSIONER
MORIN: And I presume you have many
guidelines as far as the conflicts of interest are concern?
LISTNUM
1 \l 15160 MS
SHEFFER: We have a one‑page sheet
that they sign each year and review.
And, basically, the conflicts arise only in funding decisions because
our boards do make the funding decisions, and that only happens if they are in
some distant way related to some project and then they do not participate in
those decisions.
LISTNUM
1 \l 15161 COMMISSIONER
MORIN: Thank you. I have some questions for the Rocket Fund.
LISTNUM
1 \l 15162 You
say that children's programming should receive a fair share of the $25 million
allocated for new media initiatives. I
would like to know what share of the $25 million should be reserved for the
children's programming and why?
LISTNUM
1 \l 15163 MS
AUGUSTIN: Well, we don't have an actual
number. But historically, based on the
CTF, the average percentage that goes to children's is 18 per cent of the
entire CTF funding. Children are leaders
when it comes to new media, they are the ones that are driving how it will
shape the world.
LISTNUM
1 \l 15164 And
so as far as we are concerned, the producers of our content, of our programs,
are the ones that are going to be leading and meeting that type of
funding. So we would definitely say if
it was the 18 per cent that has been established by the CTF over the last five
years, I think it has been on the average of 18 per cent, we would say that
most certainly is not enough. We think
that the children's industry would definitely need a higher percentage of that
funding in order to be effective.
LISTNUM
1 \l 15165 COMMISSIONER
MORIN: And if we accept the new
structure proposed by the task force, the money will come from the two funding
streams?
LISTNUM
1 \l 15166 MS
AUGUSTIN: Well, that is a very good
question, because that is something that we would say, does children's
programming fall under the cultural side or is it commercial? I mean, it is considered one of the best or
is the best business in our sector of television. It is the highest export, it has the most
recoupment. So from a business
perspective, even though it is receiving the smallest amount of funding, we
have very innovative program that worldwide is known.
LISTNUM
1 \l 15167 So,
in one way, it can be even more commercial that it is. But also, when you are dealing with children,
it has to be culture as well, because it is our children and there is a
responsibility. So this is where we find
it very interesting when it comes to children's programs, is that is it a genre
or is it an audience? And we think that
it is the responsibility of all of us to look at our children in all aspects.
LISTNUM
1 \l 15168 So,
yes, on the cultural side, educational programming, there should be an
allocation there. But there should be
some provisions on the commercial side that our producers could access that as
well, but have something in place that would protect kids in that arena as
well. Because on the commercial side
children's programming doesn't draw the advertising revenue and there is a
whole different dynamic when it comes to children's programming as far as what
the value of it is in the marketplace, especially, you know, within the
domestic marketplace.
LISTNUM
1 \l 15169 COMMISSIONER
MORIN: So you won't have any objection
that the two funds will compete, the public and the private, for children's
programming?
LISTNUM
1 \l 15170 MS
AUGUSTIN: Well, I wouldn't consider it
competing, I would hope that they would all compliment ‑‑
LISTNUM
1 \l 15171 COMMISSIONER
MORIN: Yes.
LISTNUM
1 \l 15172 MS
AUGUSTIN: ‑‑ so that they would both have an allocation for
children's, absolutely, not competing but actually augmenting.
LISTNUM
1 \l 15173 COMMISSIONER
MORIN: But competing in the sense that
some programs perhaps will be more popular on the public side. Many have been done in Quebec, for example,
and they were a huge success. So do you
think that the both funds are a good idea, a public and a private one?
LISTNUM
1 \l 15174 MS
AUGUSTIN: Well, we need to know more
about how the private structure would work.
We don't have enough information as far as how that structure on the
private side would ‑‑ how that would affect children's
programming, because it doesn't fall into the dramatic category.
LISTNUM
1 \l 15175 I
mean, we have, for example, have an example of a program called, This is Daniel
Cook, which I am sure you have all seen Daniel with his red hair. And Daniel Cook started out on TVO and on the
educational networks. We supported that
at the very beginning when they were new producers and a lot of people didn't
know who they were, and we have been in that program from the onset.
LISTNUM
1 \l 15176 And
Daniel Cook became a huge success and YTV picked it up and now it has gone from
being an educational cultural program, it still is, it is still the same
program, but it has become more commercial.
So it is a difficult answer, because we think that there are definitely
some educational programs that would fit more of the cultural mode. But then kids programming can be very
commercial as well and still have good values and good role modelling, so we
would like to make sure that each stream would represent it properly.
LISTNUM
1 \l 15177 COMMISSIONER
MORIN: If the recommendations of the
task force are implemented, as far as the funding streams are concerned, do you
think that the BDUs could be forced to contribute a fixed percentage of their
money or in the private fund for the children's programming?
LISTNUM
1 \l 15178 MS
AUGUSTIN: So you are asking if each BDU
would be required to or overall?
LISTNUM
1 \l 15179 COMMISSIONER
MORIN: Yes, the BDU ‑‑
the private fund or the ‑‑
LISTNUM
1 \l 15180 MS
AUGUSTIN: Yes.
LISTNUM
1 \l 15181 COMMISSIONER
MORIN: ‑‑ or the private stream will be provided by the BDU,
you know?
LISTNUM
1 \l 15182 MS
AUGUSTIN: Yes.
LISTNUM
1 \l 15183 COMMISSIONER
MORIN: And do you think that it would be
a good idea that a fixed percentage of the BDUs' revenue will be allocated for
the children's programming?
LISTNUM
1 \l 15184 MS
AUGUSTIN: Absolutely. There should be a fixed amount ‑‑
again, it would depend on what that amount would be and it would depend on how
the structure of the fund is. So it
would be difficult to answer that entirely, to say yes. But ideally, each of
the funds, we would love to see that there would be an allocation and a decent
allocation for children's program because of what it represents as a large part
of our audience, so yes.
LISTNUM
1 \l 15185 COMMISSIONER
MORIN: You say that the private funds
should be consulted on any major changes to the CTF. What do you mean exactly and could you give
me some reasons for the importance of this consultation?
LISTNUM
1 \l 15186 MS
AUGUSTIN: Well, the primary reason for
this is we are all partners in this industry.
And we, as private funds, we augment, well we finance productions just
like the CTF. Even though we are smaller
as far as the funding is concerned, we are able to contribute in various
ways. We are told by the CTF that we
compliment them because we are subjective.
Our fund, just like Andra's funds, do extensive creative review and
financial review, we do quite a bit of due diligence, we have a lot to
offer. And then from a producer's side,
when we all work together in a partnership, it makes it a lot easier for
everyone to achieve their goals.
LISTNUM
1 \l 15187 So
if the CTF is being restructured or if there is a new fund being developed, we
believe that we as private funds have a lot to offer because of our experience
in our genres, but also experience as solid funders. And it makes it a lot
easier for everyone involved in the funding of Canadian programming if we are
working together to ensure that what is being done on one side compliments the
other side.
LISTNUM
1 \l 15188 Because
we have had challenges in the past where there have been changes made to the
guidelines in the CTF and we haven't been consulted and then we have to reshift
and then there is ‑‑ it affects production, it affects how we
all do our business. And so we believe that we have a lot to offer by being
part of whatever is being structured.
LISTNUM
1 \l 15189 COMMISSIONER
MORIN: You say that the Shaw Rocket Fund
has committed over $65 million to Canadian children's programming. Could you give us some examples of its
success? And also, how do you define
success? What are your criteria,
syndication, audience numbers, et cetera?
LISTNUM
1 \l 15190 MS
AUGUSTIN: When we look at children's
programming, any Canadian programming really, there is various methods of
looking at what is successful. We have
some productions that come in that are very commercial. Atomic Betty, which is through Breakthrough
Communications, is one of our hits, we actually recouped all of our money and I
believe I can say that, because it has done really well internationally. And we knew that when we went in, it was not
funded by the CTF, that in the first season we were one of the primary funders,
and we knew when we went in that it was more commercial, we were a bit more
aggressive with our business on that one and it was successful.
LISTNUM
1 \l 15191 So
in that case, when we look at measuring that, we look at the business
case. I mean, it doesn't work for every
production, we know that because, I mean, as everyone stated here, you are not
guaranteed a hit. But we do our best
when we do our due diligence to ensure that on the creative side that it is
strong and then look at the business.
LISTNUM
1 \l 15192 But
we also look very strongly on our cultural mandate too. So there is definitely productions that we
have financed that are specific for our region, a certain Aboriginal program
that is really fantastic for its audience, knowing that it is not going to have
a lot of return. So it really depends on
what is provided to us and what the business is.
LISTNUM
1 \l 15193 And
so when we measure success, when we look at a more commercial production, yes,
it is audience numbers and then being able to sell in the marketplace. I mean, those definitely are two things that
we consider and definitely whether it is serving the Canadian audience. So it really would depend on what type of
production it is or what type of program.
LISTNUM
1 \l 15194 COMMISSIONER
MORIN: You write that BDU contributions
could contribute more efficiently to popular Canadian programming through their
redirection to existing private funds rather than splitting the CTF. So could you explain?
LISTNUM
1 \l 15195 MS
AUGUSTIN: When we first looked at the
split from the CTF, when that first came through, we looked at the initial
split as going back almost backwards towards the split when there was the LFP,
the Licence Fee Program, and then the Equity Investment Program and being governed
by two boards and the complexities of that.
LISTNUM
1 \l 15196 And
so when the recommendation came through actually to split the two funds, we are
of the mind that if there was actually going to be a split, then don't go
backwards, let us look forward and say, well, we have private funds that exist
that have their niches; the Documentary Fund, the New Media Fund, we have the
Rocket Fund that is children's programming, and we have existing models that
could be very effective and could take on the BDU side of that funding and be
able to make the most of that funding.
So we did propose that.
LISTNUM
1 \l 15197 At
this point now, there has been so many recommendations as far as what to do
with this money now. You know, the
bottom line for the Rocket Fund is to ensure that children's programming is
getting increased funding so that we can continue to serve that audience. So our recommendation goes back to what we
have been suggesting, which is going up to the 1 per cent on the Shaw
Communications side of our funding.
LISTNUM
1 \l 15198 COMMISSIONER
MORIN: Thank you.
LISTNUM
1 \l 15199 THE
CHAIRPERSON: Vice‑Chairman Arpin.
LISTNUM
1 \l 15200 COMMISSIONER
ARPIN: Ms Augustin, I only have one
question and you were in the room earlier today and surely have been following
the Shaw Communications discussions that we had for the last 18 months. What will happen to the Shaw Rocket Fund if
the Commission was to agree with the proposal put forward by Shaw
Communications? Have you undertaken any
discussion with them? Have they told you
anything ‑‑
LISTNUM
1 \l 15201 MS
AUGUSTIN: Not full discussion
regarding ‑‑ no.
LISTNUM
1 \l 15202 COMMISSIONER
ARPIN: ‑‑ that you could share with us?
LISTNUM
1 \l 15203 MS
AUGUSTIN: No, we hope, and this is not
confirmed, but we hope that ‑‑ well, we do know that Shaw has
been very pleased with what we have done over the last four years for
children's programming. And we do know
that there is a sense of pride of what we have been able to accomplish with not
just our investments, but with our Shaw Rocket Prize, we have heightened the
profile. We believe we have done well
for our contributors, not just Shaw, but also Eastlink Cable Systems. And we would hope that if there was a change
that there would be continued support for children's programming.
LISTNUM
1 \l 15204 And
we believe that when Mr. Stein said earlier that Shaw would continue to support
the initiatives they believe in, we would hope that the children's programming
would be one of those.
LISTNUM
1 \l 15205 COMMISSIONER
ARPIN: So what you are saying here is
that Shaw Rocket Fund believes that there is a need for financial support to
independent production?
LISTNUM
1 \l 15206 MS
AUGUSTIN: Yes.
LISTNUM
1 \l 15207 COMMISSIONER
ARPIN: And obviously you are looking at
it from the children's programming perspective?
LISTNUM
1 \l 15208 MS
AUGUSTIN: That is correct.
LISTNUM
1 \l 15209 COMMISSIONER
ARPIN: I have a few questions for you,
Ms Sheffer.
LISTNUM
1 \l 15210 I
am looking at your oral presentation. I
think it is worded that we, and I will read the footnote on page 10, because it
is an interesting footnote with data, so it could be it will help future
analysts or students, whoever is making research, to have an understanding of
what type of returns could be expected.
LISTNUM
1 \l 15211 The
footnote reads:
"Independent production funds
recoupment statistics 1991‑2007.
English‑language drama series recoup an average of 17.9 per cent
of their investments and French‑language production recoup 4.8 per
cent." (As Read)
LISTNUM
1 \l 15212 I
think it is interesting data, because there have been some interveners,
yesterday, saying that there is no possibility of recoupment for French
programming. So even if the number is
not that significant, there is a recoupment of an interest.
LISTNUM
1 \l 15213 My
first question is, you said in your oral presentation that ‑‑
well, you wanted to share your own experience and think that the format of
operation of the independent fund could help out.
LISTNUM
1 \l 15214 Now,
you said that the Board reviews the applications and evaluates staff
recommendations and makes funding decisions three times per year. With the volume of applications that the CTF
has to deal with, based on your own experience, how many times a year would
they have to meet?
LISTNUM
1 \l 15215 Would
they have to meet daily to make decisions if we were to follow that model?
LISTNUM
1 \l 15216 Because
you said that it isn't a model that would be contemplated.
LISTNUM
1 \l 15217 MS
SHEFFER: Between the three funds, we are
going through about 200 applications a year.
The CTF does have more than that.
LISTNUM
1 \l 15218 Subjective
analysis takes a lot of time and effort, and the proposal to do a marketing, or
a market‑driven fund ‑‑ it is unclear to me how that
would actually work. As an
administrator, I have been trying to figure that out.
LISTNUM
1 \l 15219 The
only conclusion I can come to is that it has to be subjective. There has to be an analysis done of all the
different aspects of the production ‑‑ the creative, the
business, the financial, the marketing ‑‑ in order to
determine if it is a market‑driven project or not.
LISTNUM
1 \l 15220 It
would be a massive undertaking, I think, to expect all of the applications to
go through a subjective process, and yet that is the way it would have to be
done if it was to be done correctly.
LISTNUM
1 \l 15221 COMMISSIONER
ARPIN: Okay. That's fine.
LISTNUM
1 \l 15222 You
also mention in your oral presentation that you are financing 8 out of 10
points projects. We heard yesterday
that, in all instances, it will be the writers that will be removed from the
production, because all of the parties will want to have a more focus‑based,
American point of view, and the writers are always the ones that get removed.
LISTNUM
1 \l 15223 What
is your experience?
LISTNUM
1 \l 15224 MS
SHEFFER: In our experience, this only
happens a couple of times a year. It is
not a frequent occurrence, and it usually does happen for some good reason,
which we evaluate.
LISTNUM
1 \l 15225 There
have been writers, there has been a director, and there have certainly been
some performers, so I think it is pretty well spread across those key creative
areas.
LISTNUM
1 \l 15226 There
are occasions when it has been a music composer, too. There have been other categories.
LISTNUM
1 \l 15227 COMMISSIONER
ARPIN: So it is not always the writer.
LISTNUM
1 \l 15228 MS
SHEFFER: Not always, no.
LISTNUM
1 \l 15229 COMMISSIONER
ARPIN: That's what I wanted to have on
the record. Thank you very much.
LISTNUM
1 \l 15230 Thank
you, Madam Chair.
LISTNUM
1 \l 15231 THE
CHAIRPERSON: Thank you, Ms Shaffer and
Ms Augustin, for your contribution.
LISTNUM
1 \l 15232 Madam
Secretary.
LISTNUM
1 \l 15233 THE
SECRETARY: Thank you.
LISTNUM
1 \l 15234 Now
we will hear the presentation of Keith Mahar.
‑‑‑ Pause
LISTNUM
1 \l 15235 THE
SECRETARY: You have 15 minutes for your
presentation. Thank you.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 15236 MR.
MAHAR: Thank you.
LISTNUM
1 \l 15237 Good
afternoon. The Commission has been
provided with my research report, "Profiteering in the Name of
Culture." Included with this report
are a number of documents, one being a submission that I spearheaded by
Cablewatch, which was filed with the CRTC on May 20th, 1996, as well as a
related decision made by the CRTC on June 25th, 1996, a highly unorthodox
decision that has never been made public.
It concerns the authority of the CRTC to require Canadian consumers to
pay a surcharge on the cost of cable TV in order to subsidize private cable
television and production companies.
LISTNUM
1 \l 15238 The
CRTC ruled on June 25th, 1996, in its unpublished decision, that Parliament had
granted the Commission the authority to require consumers to pay a surcharge to
fund subsidies to cable television and production companies.
LISTNUM
1 \l 15239 However,
at the same time, the CRTC also ruled that the consumers being required to pay
the subsidies were not entitled to notice that they were being required to pay
the subsidies to the companies, or the monthly cost of the subsidies that they
were being required to pay to the companies.
LISTNUM
1 \l 15240 This
undemocratic regulatory scheme has continued to the present day. A conservative estimate of the redistribution
of wealth under this program is more than $1.3 billion since January 1995.
LISTNUM
1 \l 15241 The
CRTC has refused to provide me with additional information to enable a more
precise amount to be calculated, but the information does exist and is
available to the Commission.
LISTNUM
1 \l 15242 This
is the third time that I have appeared before the CRTC to address this
issue. It is still my position that
Canadian consumers were deliberately misled, that influential corporations were
unjustly enriched, that several government policies were violated by the CRTC,
and that Canadians are entitled to be told the truth about this company subsidy
program.
LISTNUM
1 \l 15243 I
am here to simply direct your attention to the documents that I have placed on
the public record and ask you to put an end to this deceptive practice.
LISTNUM
1 \l 15244 I
strongly recommend a judicial review of this issue.
LISTNUM
1 \l 15245 Furthermore,
CRTC legal counsel Shari Faisher notified me last August that the Commission
had destroyed the unpublished decision on March 27, 2006. Ms Faisher refused to identify who at the
Commission had authorized the destruction of the unpublished decision or why it
had been destroyed at that particular time.
LISTNUM
1 \l 15246 Weeks
before the decision was shredded, my legal counsel notified Stephen Harper,
Gilles Duceppe, Jack Layton and Jim Harris of the unpublished decision, where
it was contained in File 1000‑121 as evidence of potential illegal
activities related to the companies' subsidy program.
LISTNUM
1 \l 15247 Earlier
today I launched the website "Mediascam.com", the purpose of which is
to raise awareness of this outstanding issue for interested parties.
LISTNUM
1 \l 15248 I
thank you for the time, and I am open to questions. Thank you.
LISTNUM
1 \l 15249 THE
CHAIRPERSON: Thank you, Mr. Mahar, for
your submission and your presentation here today.
LISTNUM
1 \l 15250 For
the record, you do refer to this unpublished decision a number of times, both
in your presentation and here this afternoon.
An unpublished decision is not a decision. A decision is not a decision until it is
published.
LISTNUM
1 \l 15251 None
of us was at the Commission in 1996, so I don't know what the genesis of this
letter is, or why this decision was never published, but it is not a decision
until it is published. I just wanted to
put that on the record.
LISTNUM
1 \l 15252 You
are quite a researcher, so I am going to assume that you have read some of the
submissions, or perhaps all of the submissions on this file.
LISTNUM
1 \l 15253 MR.
MAHAR: On ‑‑
LISTNUM
1 \l 15254 THE
CHAIRPERSON: On the CTF file, and on
what we are here to discuss this week.
LISTNUM
1 \l 15255 MR.
MAHAR: No, I am a researcher on the
issue that I put forward to you.
LISTNUM
1 \l 15256 I
would also like to note that I actually have a copy of that destroyed
decision. I put a copy of that destroyed
decision as an appendix.
LISTNUM
1 \l 15257 So
it exists, so you can comment on ‑‑ just because it was
destroyed doesn't mean it never existed.
LISTNUM
1 \l 15258 It
is actually posted on my website. I am
willing to talk about what the implications are.
LISTNUM
1 \l 15259 If
you don't want to, I acknowledge that. I
am just here to say that it's there for everyone who wants to look at it.
LISTNUM
1 \l 15260 I
also want to say that the Commissioners here today, and those who have been on
the Commission for the last little while, inherited this issue. This was not your decision to make. In my estimation, it is the worst decision
ever made, but it is not your decision.
LISTNUM
1 \l 15261 You
have a problem, and it is a fact that that's what it is, and it's on the
record. Thank you.
LISTNUM
1 \l 15262 THE
CHAIRPERSON: Mr. Mahar, do you support
the principles of the CTF?
LISTNUM
1 \l 15263 MR.
MAHAR: Not as it is structured now.
LISTNUM
1 \l 15264 I
support the principle of subsidies coming through Parliament.
LISTNUM
1 \l 15265 I
think, when you look at the math of this partnership ‑‑
LISTNUM
1 \l 15266 Professor
Joel Bakan from UBC, who wrote the corporation, made some very derogatory
comments about partnerships between industry and government not being good for
democracy. I think, when you look at
partnerships, you have to have something coming from the partners. Each partner has to bring something to the
table.
LISTNUM
1 \l 15267 What
happened in this case was, all the cable companies brought to the table was
that they were allowed by the CRTC to collect funds under false pretences, as
long as they gave 50 percent of those funds to this fund.
LISTNUM
1 \l 15268 They
are not a legitimate partner.
LISTNUM
1 \l 15269 I
would support even more money being given to production companies. I would change it, though, from non‑repayable
grants, which is free money, to some kind of investment ‑‑
equity investment ‑‑ where you know that they are not coming
to you before all other parties. It is
actually triggering production, as opposed to subsidizing greater wealth for
production companies.
LISTNUM
1 \l 15270 I
would support that. I would actually
like to see the scope expanded to community channels, because I personally
believe that the concentration of media is a problem. You just had a hearing on that a while
ago. I think that if some of this money
could be put into local production, you would have more diversity, and I think
you would have a better broadcasting system.
LISTNUM
1 \l 15271 But
I don't believe there is any ‑‑ there is no logical or
mathematical reason for cable to be involved, or broadcasting distribution
undertakings to be involved, because what happens is, say that you charge 5
percent or 10 percent of the revenues, that money is passed along to
consumers. It's not shared, it's passed
along.
LISTNUM
1 \l 15272 The
problem is, as it is passed along, it is now embedded in the cost of the
service. So those rate payers, whether
they know about it or not, are now paying GST and PST on top of the cost of
that embedded contribution.
LISTNUM
1 \l 15273 I
think what has to happen is that ‑‑ there is no reason for
that to happen. As long as it is sound
policy, then it can withstand the scrutiny of Parliament. All of this money should come from
Parliament. That is the way such a fund
should be directed.
LISTNUM
1 \l 15274 I
think that the composition of such funds has been a problem since Day 1,
because all of the industry ‑‑ all of the stakeholders that
were actually benefiting from the fund have been on the front. Consumers have paid for it without their
knowledge, and they have been excluded from even being on as stakeholders.
LISTNUM
1 \l 15275 I
think there are groups out there, whether it's the Consumers' Association of
Canada or the Public Interest Advocacy Centre ‑‑ there has to
be some kind of legitimate representation of consumer interests of such boards,
and that's what I would put forward.
LISTNUM
1 \l 15276 THE
CHAIRPERSON: Over the last two years the
Department of Canadian Heritage has committed $120 million to the CTF. Do you think that's an adequate amount?
LISTNUM
1 \l 15277 MR.
MAHAR: One, it depends on ‑‑
it's not just an adequate amount of the amount of moneys spent in
production. I think you have to look at,
if they are non‑repayable grants ‑‑ I have no idea
whether those productions could have actually gone to other sources and got
equity investment, and you could use that money more effectively to actually
trigger more productions elsewhere.
LISTNUM
1 \l 15278 So
it's impossible to say, and I am not an expert in any way, shape or form.
LISTNUM
1 \l 15279 What
I do know is, the math of being a partner and forcing consumers to pay this and
then pay taxes on top of it is just inefficient.
LISTNUM
1 \l 15280 I
would also add that I have gone through some of the files, and there are some
great shows ‑‑ entertaining shows ‑‑ that
have been funded.
LISTNUM
1 \l 15281 I
think people get caught up thinking, "Oh, this is a great show. This is very good," but some of them are
internationally sold. I look at that and
think: Why does that show, which is very
successful, necessarily need funding, rather than other shows, maybe genres
that aren't as popular.
LISTNUM
1 \l 15282 I
know there is a push to make popular shows, but I just wonder if that makes
sense.
LISTNUM
1 \l 15283 THE
CHAIRPERSON: Do you think that the list
of genres that qualify for CTF funding should be expanded?
LISTNUM
1 \l 15284 MR.
MAHAR: I do. I admit to bias. We all have our biases, and I would admit
that the process I have gone through, talking to politicians and actually
trying to have an impact on policy ‑‑ I think that
investigative reporting is drastically underfunded in this country.
LISTNUM
1 \l 15285 I
think that if a fund could give out programming where consumers or citizens
actually felt more empowered, or they were more actively involved in the
community, because they were getting information ‑‑ it is not
just about drama, it is not just about children's shows, it is really about
engaging Canadians. That is my
perspective.
LISTNUM
1 \l 15286 THE
CHAIRPERSON: If the fund were to only be
funded through parliamentary appropriation, do you believe that private
broadcasters should be able to access the fund?
LISTNUM
1 \l 15287 MR.
MAHAR: To be honest, my background was
with CHUM and Canadian Satellite Communications. It wasn't in programming, it was in cable,
and I don't really have an opinion. I
don't have the expertise to comment on that.
LISTNUM
1 \l 15288 THE
CHAIRPERSON: Fair enough.
LISTNUM
1 \l 15289 Do
my colleagues have any additional questions?
LISTNUM
1 \l 15290 No.
LISTNUM
1 \l 15291 Thank
you very much for your contribution, Mr. Mahar.
LISTNUM
1 \l 15292 MR.
MAHAR: Thank you.
LISTNUM
1 \l 15293 THE
CHAIRPERSON: We will take a 15‑minute
break now.
‑‑‑ Upon recessing
at 1530 / Suspension à 1530
‑‑‑ Upon resuming
at 1543 / Reprise à 1543
LISTNUM
1 \l 15294 THE
SECRETARY: We will start with the
presentation of Mr. Sanderson Layng.
LISTNUM
1 \l 15295 You
have 15 minutes. Thank you.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 15296 MR.
LAYNG: Thank you very much, Madam Chair,
Commissioners, and members of Staff. It
is very much a pleasure to be here today.
We thank you for the opportunity.
LISTNUM
1 \l 15297 I
have two purposes here this afternoon.
One is to share with you my comments with regard to the CTF matter, and
also to read into the record a presentation from Mr. Michael Girard, who was
supposed to be part of this panel, but, unfortunately, there has been a death
in his immediate family and he is unable to be here. He sends his apologies and has asked that I
read his submission, which has been provided to Staff.
LISTNUM
1 \l 15298 It
has been a while since I have appeared before the Commission. Previously I was here to talk about the issue
of closed captioning, which I helped develop for Canada, and for which the
Commission became an appropriate champion.
It was the support of the Commission, and the whole industry, that
really made closed captioning the tremendous success that it has been, and was
a driving force.
LISTNUM
1 \l 15299 That
strikes me particularly relevant as we look to the issue of the Canadian
Television Fund, because the fund is also a champion when it comes to areas
such as priority programming, and other areas where the support provided for
voices that might not otherwise have a voice in the country is extremely
important to our fabric. Just as the
Commission has championed interests of importance to the country and to that
fabric, it is important to have a strong voice being supported by the Canadian
Television Fund.
LISTNUM
1 \l 15300 I
am here today as a fan of both the Commission and the fund, and my commentary
will be in that light.
LISTNUM
1 \l 15301 Much
of what I was going to say has been presented in one form or another, so I will
keep this quite brief.
LISTNUM
1 \l 15302 In
listening to the hearing this week, I was particularly struck by the
presentation from the CBC, Mr. Stursberg, when he referred to the fact that,
like our country, the Canadian Television Fund is a work in progress, and that,
as such, it also requires the support of the Commission, of those of us in the
production field, of broadcasters, and everyone, to make it everything that it
can be, and to help it achieve its objectives.
LISTNUM
1 \l 15303 So
my commentary today about that is about the opportunity for all of us to look
at the strengths that exist within the CTF, and the accomplishments that have been
outlined by presenters so far, I think, have captured it well, the things that
are working well.
LISTNUM
1 \l 15304 There
are some areas for improvement, as there are in any work in progress, and those
need attention, and they need support, and all of us working to find solutions
that work best to help it become what it needs to be to serve the interests of
Canadian viewers and of our broadcasting system.
LISTNUM
1 \l 15305 I
would like to conclude my personal comments with an encouragement to the CTF,
and a challenge to the rest of the industry to rally around and to celebrate
the accomplishments to date, and to look forward to ways in which we can all be
a partner and a contributor to its future success.
LISTNUM
1 \l 15306 With
your permission, I would like to move to the presentation from Mr. Girard.
LISTNUM
1 \l 15307 Mr.
Girard writes: "I am a solicitor
who advises independent producers and others in the television and
entertainment industry, and I have concerns with several of the proposals which
are being advanced in the Canadian Television Fund Task Force Report.
LISTNUM
1 \l 15308 In
particular, I am concerned that the report proposes a significant departure
from broadcasting policy in Canada, which was established in the Broadcasting
Act, and has carried through into the spirit and intent of the Canadian
Television Fund.
LISTNUM
1 \l 15309 The
broadcasting policy informs the mandate of the Canadian Television Fund and
finds further expression in the spirit and intent of the guidelines. Several of the proposals made by the Canadian
Television Fund Task Force Report appear to run counter to the broadcasting
policy and the mandate of the Canadian Television Fund. In particular: (1) the accountability for the sources of CTF
funding; (2) the proposal to split the CTF funding into two streams; and (3)
the proposal to reduce Canadian content requirements to 8 out of 10 from 10 out
of 10.
LISTNUM
1 \l 15310 In
terms of accountability, some of the BDUs have created a crisis by withholding
funds that were to be paid to the CTF.
The BDUs are trying to reframe the debate about these funds and
accountability for their disbursal.
LISTNUM
1 \l 15311 The
BDUs want the argument to be about whether their funds are being used by the
CTF inefficiently or ineffectively. They
want to cause changes to the CTF so that they can gain control over these funds
and direct them to enterprises with which they are affiliated, either directly
or indirectly, thereby keeping more of the pie.
LISTNUM
1 \l 15312 This
argument comes from a false premise. The
funds received by the CTF from BDUs are funds paid by BDU subscribers, arising
out of a prior levy. These funds do not
belong to the BDUs, and their withholding of funds show a disregard for the CTF
and the principles of the Broadcasting Act.
This is highly inappropriate, and I would suggest to the Commission that
they might consider an even greater percentage of the subscriber levy going to
promote the CTF and the objectives of the Broadcasting Act.
LISTNUM
1 \l 15313 As
for the proposal to split the funding of the CTF into two separate streams, I
believe this would, firstly, adversely affect the independent production
sector; secondly, reduce the variety of Canadian productions; thirdly, curtail
the diversity of Canadian productions; and, finally, limit the creativity of
producers by the focus on audience success.
LISTNUM
1 \l 15314 The
premise underlying the separate fund is that, by a greater focus on successful
programming, CTF funds will be better directed and administered. This premise does not seem to have a
reasonable foundation.
LISTNUM
1 \l 15315 Currently,
broadcasters are the only ones that can trigger CTF funding. Presumably these broadcasters are using their
best efforts to identify programs that will be successful commercially. Indeed, that is a primary goal. There is no evidence to suggest that, by
splitting the fund into two different streams, anything will be done to improve
the ability of these same broadcasters to identify programs that will achieve
higher audience rates.
LISTNUM
1 \l 15316 Neither
is there any suggestion that BDUs are in a position to identify a hit show any
better than broadcasters.
LISTNUM
1 \l 15317 Audience
success factors are already a very significant factor in the allocation of the
CTF envelope. The audience success of a
broadcaster's CTF or "CTF‑able" programs accounts for 30
percent of the envelope allocation. Two
streams would undoubtedly create more administrative burden for the CTF.
LISTNUM
1 \l 15318 As
for the proposal to reduce CAVCO requirements to 8 out of 10, this does not
appear to be supported by any rationale.
This also runs contrary to the broadcasting policy of making maximum use
and, in no case, less than predominant use of Canadian creative and other
resources in the creation and presentation of programming.
LISTNUM
1 \l 15319 There
is no evidence to support that a reduction of the Canadian content requirements
will make programming more successful.
In fact, those in the Canadian creative community might consider this an
insult, and there is no basis for such a fundamental change in the absence of
substantial supporting evidence.
LISTNUM
1 \l 15320 Canadian
shows are achieving success here at home and abroad under the current content
rules, and the CTF should not move away from the current CAVCO requirements, in
my view.
LISTNUM
1 \l 15321 In
conclusion, while there are improvements to be made at the CTF, the three
issues I have noted here do not advance their effectiveness, nor do they
advance broadcast policy.
LISTNUM
1 \l 15322 On
behalf of Mr. Girard, thank you very much for the opportunity to present these
thoughts.
LISTNUM
1 \l 15323 THE
SECRETARY: Thank you.
LISTNUM
1 \l 15324 Now
we will hear the presentation of Mr. Aaron Goldman.
LISTNUM
1 \l 15325 You
have 15 minutes. Thank you.
PRESENTATION / PRÉSENTATION
LISTNUM
1 \l 15326 MR.
GOLDMAN: Madam Chair, Commissioners and
members of Staff, the Canadian Television Fund plays a vital role in
facilitating the licensing of Canadian priority programming by CRTC licensed
broadcasters. The broadcaster performance
envelope system, designed in part to help make the CTF more predictable and
efficient for broadcasters and producers alike, is meant to reward broadcasters
who invest in priority programming for a number of factors, including
historical investments in priority programming, above‑average licence
fees for such programming, and audience success.
LISTNUM
1 \l 15327 Audience
success is obviously an important factor for any program. Broadcasters and producers alike both benefit
when the shows they cooperate in producing are successful. Both suffer when their shows do not succeed.
LISTNUM
1 \l 15328 As
in a free market economy, it may be best to entrust broadcasters and producers
alike with ensuring that the programs they produce are designed to attract audiences,
since such success is in the best interests of both broadcasters and producers.
LISTNUM
1 \l 15329 I
am concerned that having access to CTF funding hinges so heavily on this
success. It seems a bit like a lottery,
since television audiences can be very fickle.
LISTNUM
1 \l 15330 It
may actually be detrimental to the development of solid, quality, priority
programming to make the funding of such programming heavily dependent on its
audience success factor, when broadcaster and producer behaviour are already
naturally driven by audience success.
LISTNUM
1 \l 15331 The
audience success factor also naturally leans heavily in favour of larger, more
entrenched broadcasters, who are able to spend larger budgets on programs that
attract large audiences. As we understand
the formula for the audience success factor, it also lends itself to
broadcasters airing shows repeatedly in order to deliver higher total viewer
numbers to the CTF for the purposes of increasing the audience success factor. This seems counterintuitive.
LISTNUM
1 \l 15332 Another
question to consider is whether it is fair to limit the rewards for audience
success to broadcasters of CTF funded programs that achieve such success,
rather than allocating some form of bonus for audience success to the producers
of such programs.
LISTNUM
1 \l 15333 While
the formula used by the CTF to determine a broadcaster's performance envelope
is not yet transparent to me, one thing seemed very clear: the current system for determining
broadcaster performance envelopes represents an incredibly steep, systemic
barrier to accessing CTF moneys for small broadcasters and new entrants alike.
LISTNUM
1 \l 15334 Currently,
the CTF advises that a broadcaster must spend a minimum of $2 million per year
on priority programming in order to be eligible for an envelope. Presumably this is true whether a broadcaster
makes all of their priority programming spend on one production or a plethora
of small shows, with the intent of presenting a wide variety and high volume of
Canadian content to its viewers.
LISTNUM
1 \l 15335 Also,
in initial operations for a new broadcaster, even where a broadcaster is
producing a very high volume of Canadian content and has the majority of its
prime time devoted to priority programming, new entrants are not eligible for
CTF funding.
LISTNUM
1 \l 15336 I
suggest that the following approach be used to allow new entrants and existing
broadcasters, who do not currently access the CTF, immediate and equitable
access to the CTF, based on their initial commitments to priority programming.
LISTNUM
1 \l 15337 First,
I suggest that the minimum spend that a broadcaster must make to be eligible
for a broadcaster performance envelope be lowered to either $2 million or a
minimum licence of $20,000 per broadcast hour, with a maximum spend for this
new entrant or re‑entrant formula to be capped at $10 million in the
broadcaster's first year of eligibility for the CTF.
LISTNUM
1 \l 15338 Second,
I would suggest that new entrants be given an historical factor equivalent to
the dollar amount of priority programming they commit to licensing in their
first year of operations in each of the priority programming categories.
LISTNUM
1 \l 15339 I
would suggest that 75 percent of said commitment would have to be demonstrated
through either licence fee contracts or moneys placed in trust that would
default to the CTF if not allocated by the broadcaster by the CTF annual
deadline for allocation of broadcasters' envelopes, unless otherwise agreed to,
in writing, with the CTF.
LISTNUM
1 \l 15340 Finally,
I would suggest that an additional factor be added to determine the initial
eligibility for new entrants or re‑entrants to the CTF funding
system ‑‑ the Canadian Content Factor, or CCF.
LISTNUM
1 \l 15341 The
CCF would be a simple multiple of the percentage of priority programming in a
broadcaster's projected schedule, multiplied by the percentage of priority
programming in the broadcaster's prime time schedule.
LISTNUM
1 \l 15342 I
would suggest that these rather simple eligibility factors for broadcasters who
wish to begin to access the CTF comprise an excellent incentive for both
existing broadcasters who do not access the CTF and new entrants to the
Canadian broadcasting system to license and broadcast a high volume and a high
quality of priority programming, just as the Canadian Television Fund is meant
to do.
LISTNUM
1 \l 15343 Just
as importantly, these measures provide a fair and level playing field to new
entrants and existing broadcasters who do not currently access CTF moneys to
gain immediate and fair access to CTF funds, rather than protecting the access
of entrenched broadcasters to a fund that is not meant to be restricted to
monopoly or big business interests.
LISTNUM
1 \l 15344 I
respectfully request that the Commission seriously consider the implementation
of these changes in the broadcaster performance envelope system.
LISTNUM
1 \l 15345 I
would also ask that my colleague Ryan Sutherland's proposal that the CTF
implement a dispute resolution policy to protect and safeguard CTF funded
programs against the potential pitfalls existing in the current default policy
of the CTF be given serious consideration.
I feel this would be in the best interests of all stakeholders of the
CTF and of the many crew, talent, and suppliers in our industry who rely on CTF
funding to be stable for productions, even in the event of a dispute arising
between a broadcaster and an independent production company.
LISTNUM
1 \l 15346 I
thank the Commission for the opportunity to express these views, and I would
welcome any questions you may have of me.
LISTNUM
1 \l 15347 THE
CHAIRPERSON: Thank you, Mr. Layng, and
welcome back, Mr. Goldman. I would ask
Vice‑Chairman Arpin to lead the questioning.
LISTNUM
1 \l 15348 COMMISSIONER
ARPIN: Thank you, gentlemen, for your
presentations.
LISTNUM
1 \l 15349 I
am feeling a bit compelled not to ask you any questions, Mr. Goldman, because I
will be sitting next week when Yes TV will be appearing. You are both in that instance, so, unless my
colleagues have questions to ask, I will have to refrain, and I should probably
remove my ‑‑
‑‑‑ Laughter /
Rires
LISTNUM
1 \l 15350 THE
CHAIRPERSON: I think, then, we are going
to excuse you, gentlemen.
LISTNUM
1 \l 15351 MR.
LAYNG: Thanks very much.
LISTNUM
1 \l 15352 MR.
GOLDMAN: Thank you very much.
LISTNUM
1 \l 15353 THE
CHAIRPERSON: Please give Mr. Girard our
condolences for the loss in his family.
LISTNUM
1 \l 15354 MR.
LAYNG: We will do, thank you.
LISTNUM
1 \l 15355 THE
CHAIRPERSON: Thank you.
LISTNUM
1 \l 15356 We
are adjourned for the day. We will see
you again tomorrow morning. Have a great
evening.
‑‑‑ Whereupon the
hearing adjourned at 1600, to resume
on Friday, February 8, 2008, at 0900 / L'audience
est adjournée à 1600, pour reprendre le vendredi
8 fevrier 2008 à
0900
REPORTERS
____________________ ____________________
Johanne Morin Sue Villeneuve
____________________ ____________________
Beverley Dillabough Jennifer Cheslock
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