Drama spending, HD among CRTC’s concerns in TV review

CRTC chair Charles Dalfen revealed the scope of the long-awaited television policy review at the 2006 Banff World Television Festival last week. High on the agenda: finding the most efficient way to fund Cancon, clearing up financial regulations for broadcasters, and promoting production in high-definition (HD). In his remarks, Dalfen specifically targeted drama programming, the most-watched genre on television but also one of the most unstably funded. "Drama goes to the heart of the objectives that are most closely tied to ensuring that our broadcasting system is a place where Canadians will not only see the world on TV, but will also see themselves," he said. However, he noted, while conventional broadcasters’ spending on Canadian programming across all genres rose 14% from 2001 to 2005, their spending on drama grew by only 3%. What’s more, all of that increase was due to increased activity on the French-language side: spending on Anglophone drama actually decreased. While Broadcasting Notice of Public Hearing 2006-5 lays out the framework for a review of certain aspects of the 1999 policy for over-the-air television broadcasting, the CRTC believes much of the earlier policy is still pertinent and will accordingly remain in place. But Dalfen alluded to the removal of mandated minimum contributions to production funding in the 1999 review. At that time, the CRTC viewed the trend toward consolidation in the media landscape as a much more desirable way to raise money for Canadian content, and required that companies merging or acquiring another contribute at least 10% of the total transaction value to production funding. Since then, transactions such as CanWest Global Communications’ takeover of WIC Western International Communications Inc., Quebecor Media Inc.’s purchase of TVA, and BCE Inc.’s acquisition of CTV Inc. have generated approximately $482 million in benefits. But the commission doesn’t expect that trend of consolidation among broadcast players to continue at the same pace, and benefits related to transfers of ownership are expected to decline. The commission is therefore asking for input on two questions: is the current regulatory environment sufficient to meet the Canadian content requirements laid out in the Broadcasting Act, and; should licensees of over-the-air broadcasting operations have to meet a minimum level of funding to independent producers? Pamela Brand, national executive director and CEO of the Directors Guild of Canada, says that under the benefits package phased in during the 1999 television review, funding has slumped well below pre-1999 levels. "The definition of priority programming that was in place prior to 1999 was broadened to include shows like Canadian Idol, so the spending on drama fell," she notes. Rob Morton, treasurer of the Union of British Columbia Performers, a provincial affiliate of the Alliance of Cinema, Television and Radio Artists (ACTRA), concurs that it’s the changed definition of programming emphasis that is the root of much of the current depression in drama production. "I think it’s a problem that the CRTC created when they let them off the hook for priority programming, and let drama broaden," he says. The timeslots in which Cancon airs is nearly as important a consideration as the quantity of it, Brand adds. The current regulatory environment allows for a quota bonus of up to 150% for airing Canadian-made programming during main viewing hours. "We would like to see meaningful expenditures on Canadian programming real Canadian programming in real prime-time, 7-to-10, Monday to Friday," she says. "We’d like to make sure that Canadian programs aren’t shoved off onto the shoulder periods where nobody’s watching." In the end, says S&S Productions Inc. VP David Smith – whose firm produced the comedy series Smith & Smith, The Red Green Show and, most recently, Jeff Ltd. on CTV – Canada’s broadcasters will likely provide the level of funding required to produce the programming needed to meet their Cancon levels. "Regardless of what the funding model is, as long as the broadcasters have a requirement to produce Canadian shows, they’ll find a way to do it. We’ve seen examples of where a network wants to do a show, they don’t get funding, and then all of a sudden it happens ." But, Smith adds, Cancon requirements of some description need to remain in place, lest Canadian programming dwindles to nearly nothing at the whim of broadcasters. "If they didn’t have to run Canadian programs, they wouldn’t – it’s far cheaper and easier just to rebroadcast American shows," he says, adding that a broadcast licence "is a licence to print money, and having to run Canadian shows is like a kind of tax that you have to pay in order to get the real money." In a panel later that morning titled "Canadian Leaders Talk Trends," heads of some of Canada’s largest media companies delivered their take on the announcement. "We were very encouraged by what Charles said," said CHUM Ltd. president and CEO Jay Switzer. "It is a very challenging time, and although no one in this room has any right or privilege to do business, we think there is a role to play for traditional TV." But Alliance Atlantis CEO Phyllis Yaffe was very much aware of how decisions made this winter could impact the specialty and pay channel review scheduled to get under way in 2007. "I urge the commission not to make changes to one part without remembering that it affects all the others." Morton shares some of Yaffe’s concerns. "I guess my biggest fear with this is the process," he says, noting that CRTC policy hearings are traditionally dominated by all the industry stakeholders save one: the viewers. "I think the CRTC certainly must get out and talk to the general public and get their input," Morton says. "Go beyond the industry, reach out." Steven Comeau, president of Halifax-based Collideascope Entertainment, which produces children’s and family programming for both traditional television and new media platforms, says he’s cynical about the timing of this decision to review the television industry in Canada. While it’s been seven years since the last review, he sees it more as a coverup for a political agenda. "Why launch these reviews now, when the entire objective of this government is to position itself for another election and a majority government?" he asks. Peppered throughout the content and conversations – both formal and informal – at the festival was the unknown quantity that is the Internet and other unregulated distribution networks. Dalfen was by no means an exception: in his address, he referenced the fact that "the television set is losing its monopoly as the viewing platform for TV programming." Comeau believes that given past policy decisions – notably the landmark 1999 ruling that the CRTC had neither the power nor the potential to regulate the online world – the television review process could be set up to fail. "I think they’re going to use the unregulated aspect of this as a justification for curbing the power of the CRTC," he says. And now that the promise of convergence is becoming real, broadcasters are beginning to understand that the protection afforded to them by Canadian content requirements in the traditional network world don’t apply in the new one – a reality that many new media producers have had to face for some time. "Now that these new platforms are starting to affect television producers – who, by the way, have a very effective lobby – they’re starting to buy into this stuff that we’ve been talking about," Comeau says. Indeed, Heritage minister Bev Oda, speaking at the Banff festival the day before Dalfen’s breakfast keynote, announced that she had used section 15 of the Broadcasting Act to order the commission to prepare a report on the impact of technology on conventional broadcasters. The commission will solicit input from the industry and tender its findings by December 14. Dalfen’s speech and public notice conveyed the commission’s view on the importance of another emerging technology – high-definition television – and stressed that while Canadians are buying HD television sets and seeking out HD content, the vast majority of it hails from US production houses at present. Increased production in HD, therefore, is yet another facet of Cancon. That stance seemed to be expected by many in attendance at the festival – indeed, many say they’re already ramping up and producing more HD programming. "It’s just kind of necessary – even the specialty channels are asking for HD delivery now," Smith observes. "Before, they had no interest. But it’s accelerating – everything’s in HD now." Brand concurred, but provided a caveat: "I think HD is very important, it shouldn’t come out of production funding."

Drama spending, HD among CRTC’s concerns in TV review

Broadcast | June 20, 2006

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