Creators’ groups have mixed feelings about CTF report

While most others in the broadcasting value chain are remaining mum about the recently released report on the Canadian Television Fund, creators' organizations are venting over a key proposal to treat BDU contributions to the fund differently.The report, which was issued on June 29, recommends that contributions from broadcasting distribution undertakings - which currently account for roughly 55% of the fund's capital - be allowed to go to productions that meet at least eight out of the 10 possible points for Canadian content eligibility on the Canadian Audio-Visual Certification Office's (CAVCO) scale."I believe for everyone who works in this industry, particularly those of us who are trying to tell stories about Canadian experiences and values, that this is a damning report," says Maureen Parker, executive director of the Writers Guild of Canada, which represents more than 1,800 screenwriters and other wordsmiths working in film, television and new media.Beyond the reduction of two CAVCO points for projects funded by BDU monies, the report - created by a task force headed by CRTC vice-chair of broadcasting Michel Arpin - also recommends that other traditional tests of a show's "Canadian-ness" be de-emphasized in an effort to grow audience share for homegrown programming."The two remaining essential requirements, namely that the project be shot and set primarily in Canada and that the project speak to Canadians about, and reflect, Canadian themes and subject matter, are, in the view of the Task Force, unnecessary for more market-driven Canadian productions," the report reads." saying: if you want a commercial product, it needs to be less Canadian. I think that's shameful, and it's also not accurate," she says. "If you tell a good story you will get an audience....there is nothing that brings in a bigger audience than Corner Gas, that I know."But while the show, produced by Regina's Vérité Films Inc., is undoubtedly popular, CTV Inc.'s own figures placed the high-water mark for Corner Gas' most recent season, which ended in March, at 16 out of the top 20 most-watched programs in Canada. It was, however, the most-watched comedy show in Canada, and the only scripted series to earn a spot in the top 20.One possible mitigating factor in the reduction of CAVCO points is the time credits that broadcasters get for airing 10-out-of-10 and eight-out-of-10 productions. With a 50% bonus for full 10-point productions and a 25% bonus for eight and nine-out-of-ten shows, those credits help broadcasters fulfil their Canadian content exhibition requirement faster. However, the jury is still out on whether that's enough of an enticement for broadcasters to continue to support 10-out-of-10-point productions. "Is it better for them to get that extra 25% credit, or do they want to do an eight-point instead of a 10-point?," asks Monique Lafontaine, general counsel and director of regulatory affairs at the Directors Guild of Canada. "I don't know that losing that 25% will be incentive enough to do the 10-point. I doubt it."The review of the fund was largely triggered by threats made last year by Shaw Communications Inc. and Québecor Inc.'s Groupe Vidéotron ltée. The two BDUs balked at what they perceived to be undue benefits going to the CBC and a lack of emphasis on commercial suitability in funding guidelines, and said they would withhold their financial support for the fund until a full audit of its mandate and practices was completed. Representatives from Shaw and Québecor weren't available for comment.While certainly the relative influence of the BDUs over the fund has been ascendant over the past few years, broadcasters have also become increasingly influential in the CTF's operation. Case in point: the Broadcaster Performance Envelope (BPE) system, introduced in 2004, which benefits broadcasters who promote and support CTF-funded productions with an increased share in subsequent funding rounds, as well as more discretion in how those funds are used.Given that relatively new freedom for broadcasters, Parker says the success or failure of Canadian productions rests with them. "The broadcasters now have complete control over the system - they have the money, they have the envelopes, their job is to prioritize what programs are made in order to garner an audience," she says. "If they don't get an audience, I'd say they're failing."But unlike Parker, others see considerable good in the report. Despite her reservations about the diminished importance of full 10-out-of-10-point productions, the DGC's Lafontaine says the report puts the CTF's existence back on firmer ground by emphasizing the fund's great importance to the Canadian broadcasting system.Lafontaine also points to the report's recommendations that BDUs make their CTF contributions on a monthly basis - the current yearly requirement played a major factor in Shaw and Québecor/Vidéotron's pressure campaign - as a positive measure. Finally, she also notes that the document rejects Québecor/Vidéotron's argument that non-traditional broadcasting outlets, such as video-on-demand offerings, should be eligible to receive BPE monies, thus avoiding any dilution of funding.Kirwan Cox, a Rigaud QC-based documentary researcher and a Documentary Organization of Canada (DOC) member, says he believes the report "is actually quite a balanced document." However, he adds, the true test of its relative value to broadcasters, BDUs, producers and creators will be in its implementation."Obviously large audiences and high return on investment are good objectives, but from a documentary point of view I would be concerned that this puts more pressure on POV and one-off documentaries, which already have a tough time finding room on the schedule," he says.Another recommendation, to reduce the level of federal tax credits that can be put towards a show's budget from 90% to 50%, is especially important to documentary producers, the report notes. Cox concurs."The original purpose of the tax credit was to help build independent production companies, and they need that money to bridge from one production to the next and so forth, to build up their capital," he says. Instead, producers have increasingly been pressured by broadcasters to borrow to contribute the maximum 90% credit to a production's budget, thus reducing the broadcaster's share of the risk in the project."Basically, the broadcasters are taking advantage of public subsidies that are supposed to be aimed at the independent producer, and using those public subsidies for their own benefit in order to reduce licence fees," Cox concludes.As proof of that trend, Cox offers a study he published in May 2004, which compares broadcaster licence fees in Canada with those in Australia, the US, and the UK. He found that Canadian broadcasters paid the least in licence fees as a percentage of the production budget at 18.4% on average. In the UK, by comparison, fees ranged from 70% to 115% of the budget. Canadian broadcasters also spent the most on foreign programming on average, and had the lowest per capita advertising revenue.While he's optimistic the report's recommendations will lead to some positive change for the supply side of the broadcasting value chain, Cox worries that future pressure from the demand size - broadcasters and BDUs - might lead to the exercise being repeated."The big question mark that hangs over this report is, is that the end of the road or is that just the beginning of ongoing pressure by the broadcasters?" he asks.

Creators’ groups have mixed feelings about CTF report

Broadcast | July 12, 2007

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