Newsmakers: Independent producers have to adapt and compromise, Péladeau says

On February 12, Quebecor Inc. president and CEO Pierre Karl Péladeau proposed an alternative plan for funding independent productions. Instead of the $19 million Québecor’s Vidéotron ltée unit currently sends to the Canadian Television Fund (see story CTF DISPUTE RAGES ON), Péladeau proposed diverting that amount and 33% more this year to its own Québecor Fund, a move he admitted will shake up the independent production industry. Although Péladeau’s speech was in French, what follows are excerpts from an English-language translation of his speaking notes kindly provided by Québecor.What would happen to independent producers? Before answering that question, I want to clarify one point, or dispel a myth. To listen to the statements made in the last 10 days, someone outside the business would probably have concluded that the independent production industry is made up of many production houses, with hundreds of employees who risk layoffs because we have not sent our cheque to the Canadian Television Fund. Nothing could be further from the truth.The so-called independent production enterprises have very few permanent employees, they own practically no production equipment or studios, and they rely essentially on expertise that is truly special for a businessman used to daily risk-taking; they are experts in production financing and what makes this expertise so unique is that they never have to invest directly in productions. In other words, they take no risk and are generously compensated on the basis of a fixed percentage of the total cost of the production.With the approach we are proposing, the independent production industry would not disappear, but it would undergo a profound change. Rather than experts in financing, the independent producers would have to become experts in production. They would take charge of production that we cannot do internally due to our limited capacity. We believe that this will lead to the emergence of a stronger, independent production industry, which will survive, like any private enterprise, by constantly improving. The bottom line is that there will be no loss of jobs among the real creative and crafts people, all of whom are freelancers, because the amount of production will increase.Another question you are probably asking yourself: does the approach proposed by Quebecor mean the end of the Canadian Television Fund. I would say that depends on what others choose to do. We are not trying to impose our approach on other players in the industry. What we are proposing is a formula for "opting in" or "opting out" that will allow others to choose the system that best meets their needs. By choosing the "opting out" option - which would be our choice - our broadcasting interests would not have access to direct federal government subsidies, the famous $100 million annually that I spoke of earlier. Those who would chose "opting in" would continue to have access to direct subsidies.......We are convinced that is an approach that will allow our industry to meet the challenges of the digital revolution and that, far from leading to a decrease in the level of production activity, will lead to an increase in both the quality and the quantity of production. In an integrated system such as ours, we can set ourselves up with a production capability that, we hope, will allow local creative and crafts people to participate in the enormous production growth driven by the multiplication of distribution channels and the elimination of borders.

Newsmakers: Independent producers have to adapt and compromise, Péladeau says

News | February 14, 2007

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