Category Archives: CMF

The Diversity Issue – Are We Doing Enough?

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Are we doing enough on diversity in Canadian film, television and digital media?  OK, we all know that the answer is no because you can look around any production office or an industry event and see that it is not reflective of the audience that the industry is trying to entertain. In other industries there are stats that demonstrate that diverse boards or diverse employees result in higher revenues and larger market penetration.  This is likely true for the screen-based industries too but since our purpose is entertainment we have to also ask ourselves how can we reach audiences with our stories when we don’t reflect those audiences?

What is the actual extent of the non-diversity of our Canadian screen-based industries?  That’s hard to say because there are no stats that can answer that question.  There is no agreement even on how to define diversity.  Is it a set of checkboxes pulled from the Employment Equity Act or the broader Charter of Rights or a way of looking at employees and talent to ensure that you are pulling from the largest possible talent pool to get the most creative talent (yeah, I think it’s the latter).

Broadcasters have to track women, visible minorities, disabled and indigenous employees under employment equity legislation and CRTC requirements.  Think about the categories that legislation leaves out though like sexual orientation or identity, marital status, religion, age, country of origin, economic status, neurological differences and more.  There is no requirement by anyone to track the employees at production companies or on sets.  Women in View has published studies of the number of women in key creative positions in film, television and web series but those studies are not a comprehensive look at all job categories nor do they look at other forms of diversity.   Lights, Camera, Access! commissioned a report on employment patterns for people with disabilities in the screen-based industries, but again it was a snapshot of the problem rather than a comprehensive statistical analysis.

If we do not know the full extent of the problem then it will be impossible to measure progress.  In the absence of stats, but recognizing that something has to be done, Telefilm, CMF and others are now factoring gender parity into their evaluation process.  Why are they focused on gender parity rather than full diversity?  My theory is that it is significantly easier to measure the existing gender balance and any improvements and it is easier to put in place measures to improve that balance, than to do the same for any other underserved groups.  One of the greatest obstacles to measuring diversity is the reluctance of marginalized people to self-identify for fear that the identification will be used against them.  With a few exceptions, it is relatively easy to identify gender even if people do not wish to self-identify.

Will a focus on gender parity naturally lead to greater diversity?  I have heard this argument made on more than one occasion and I can’t follow it.  More women means more women.  Even worse, without systemic change it is likely that those additional women will all be white, straight, able-bodied etc. women.

Any systemic change will be more difficult to enact and will take more than a new line on an evaluation form.  We need to ask ourselves how we are recruiting talent, where we are looking, are our job descriptions reflecting bias, do we even understand our own biases.  We need to educate leaders, managers who do the hiring and even funders on what diversity and inclusion means.

In my opinion it is never a bad thing to try to make a difference so I do applaud everyone who is trying, even if it is only to impact the gender balance.  I just ask that we keep working on this problem.  Let’s get the stats we need.  Let’s train more people on diversity and inclusion.  Let’s figure out where to best put our efforts to create long lasting change.  As screenwriter Denis McGrath had been known to say, and put on a button, ‘Best Idea Wins’, but the industry needs to be more inclusive and reflective of our audience if it is going to have the best pool of ideas to pick from.

[At Denis McGrath’s Celebration of Life today, Mark Ellis reminded me that I had promised Denis that I would blog more.  So, after wiping away the tears, I started planning this post.  This is my oh so small effort to ensure that his impact will be long lasting.]

Best Idea Wins button

CMF Consultations – Should You Care? Yes.

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The CMF Consultation Tour for 2015 launched yesterday with the ‘focus group’ in Toronto.  There will be a road show across Canada as well as topic-specific Working Groups for representatives of industry stakeholder groups. You can see the tour schedule and a copy of the presentation deck here.   As well as in person feedback you can send in your thoughts in a letter or more formal submission or you can tweet feedback using the hashtag #cmfconsults.

Why should you care?

Every two years CMF has a major consultation to inform any necessary changes to their two-year guidelines.  The consultation tour and the Working Groups are a great opportunity for the various stakeholders to get into a room, air their issues and hear the perspectives and explanations of both other stakeholders and CMF staff.  It is also the best opportunity for CMF staff to hear about how their programs are working or might need to be tweaked.

This year though, the CMF is taking on an additional task.  We all know change is coming to how Canadian programming will be funded brought about by changing audience behaviour, technology, business models and regulation (i.e. Talk TV), which will likely all lead to reduced revenues to Canada Media Fund and possibly to broadcasters as well.  Rather than wait for these changes to have a major impact (they have already started) CMF has started thinking about what changes they need to make to stay relevant.  This started with an internal visioning exercise which has resulted in a few new concepts which they would like feedback on from the industry.  Word of warning though – major changes cannot be implemented without the agreement of Heritage because of the limitations contained in the Contribution Agreement between Heritage and CMF, limitations such as requiring broadcast triggers for funding.  It is unlikely that Heritage will agree to major changes in CMF during an election year or during what we all expect to be a minority government.

If little can be done now, then why have this process?  It is actually rare in our world for a funder to look ahead, think about how they need to adapt, and ask for stakeholder input on their ideas.  Even if CMF might only be able to make minor changes this year, if they have a strategy they can make those changes consistent with that strategy.  What a concept! [Oh, for a National Digital Strategy!]

I encourage you therefore to check out the presentation deck and either through your organization or individually share your thoughts with the CMF.  To get you started, here are a few of the highlights from yesterday’s consultation.

The top goals that the CMF sees for this exercise are that the CMF should:

  • support a wider array of linear and interactive content;
  • increase the focus on supporting landmark content; and
  • implement an approach based on supporting content along a continuum, from emergence to growth to sustainability.

Right away I know you are reacting to some of those words but hang on.  The next step in the exercise is to look at those outcomes through the CMF’s three activities:  foster and develop, finance and promote.  The result is a very dense slide (slide 35) of program verticals, targets, project types and objectives.  I’ll try to summarize it.

Going forward, expecting less revenue, the CMF would like to focus on ‘landmark content’ to maximize their resources where they will have the greatest impact now with audiences and with ongoing revenues.  They want to support production companies through the three stages of emergence, growth and sustainability so move beyond just project-specific financing to help the industry reach sustainability.  Project-specific funding should eventually be regardless of platform.  CMF has a role to play in promoting Canadian programming and financing the increased need for promotion in the crowded media landscape.

A lot of time during the consultation was spent on this new concept of ‘landmark content’ and how it differed from what CMF currently funds (i.e. who is going to lose out) and how the definition might need to be adapted depending on genre (i.e. kids or documentary) or platform (i.e. television or videogames).  It wasn’t clear to anyone there who would determine what is ‘landmark’, particularly since ‘high potential for success’ is a rather subjective concept.  Someone in the audience suggested that ‘landmark’ should mean popular like “Big Bang Theory” but the CMF seems to be going in the direction that it means much more than just audience size but also critical acclaim, international sales, longevity and as well popularity within a niche audience.   Feature film, documentary and interactive producers in the room were particularly concerned about what this definition might mean for their sectors.  Even the drama producers, who probably have a better idea of how ‘landmark’ might be defined for them, were concerned that there would be enough development money to ensure the creation of ‘landmark’ content.

A platform-agnostic approach would mean the ability to fund digital-only (or first) linear video content or web series.  Currently only IPF and Cogeco fund web series and they have limited funds and support only some genres.  The CMF can see a role for itself here but needs input on what it should fund and how, if it were to be able to fund web series.  Remember – there’s that pesky Contribution Agreement requiring broadcast triggers.

I found the discussion about potentially moving beyond project-based financing to be very interesting.  The CMF is exploring the idea of slate development or production financing, corporate financing based on a business plan, more financing for marketing and promotion and export development.  Last winter I did some research on different forms of ‘enterprise financing’ in different jurisdictions so I know that this is definitely a timely consideration as funding agencies around the world are trying to supplement traditional project financing with targeted financing that will build the businesses and help create stable and sustainable sectors.  There are many different ways that this could be done with different measurements of success (i.e. revenue generated, jobs, exports, production growth etc.).  If revenues to CMF are going to dwindle with no replacement regime in sight*, then it makes a lot of sense to help businesses need less (not no) government support.

There are no quick fixes to these issues and lots of potential for damage if the wrong decisions are made or impact is not fully thought out.  This is a great opportunity to be part of the planning.  I encourage you to read the materials, attend consultation sessions, ask questions and of course, tweet.  I’ll be following along with great interest.

*In a timely tweet an FCC Commissioner shared a blog post about New Zealand considering imposing a sales tax regime on Netflix, which would be a first step towards confirming that the CRTC had jurisdiction to impose a contribution regime on Netflix and similar non-Canadian OTT services.

Digital Canada 150 2.0 – Have They Gotten It Right Yet? Not so much.

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I was going to break down the differences between Digital Canada 150 (released April 4, 2014) and Digital Canada 150 2.0 (released today) but it’s kind of ridiculous. Very little has changed in the past year. It is still more of a ‘look what we did including a bunch of stuff that has nothing to do with a national digital strategy but sounds good’ than a plan for ensuring that Canada and all Canadians are digitally literate, part of the digital economy, using the tools and enjoying the content.

Yay – the government connected more rural Canadians to broadband but still no mention of ensuring affordable access to broadband for Canadians regardless of where they live. Increasingly, digital literacy and access are essential elements to exercise of Canadian citizenship and this continued omission supports the digital divide between those who can exercise their citizenship and those who cannot.  [Note – contrast that with the Digital Argentina law of 2014 that, among other things, is aimed at ensuring fair access of all citizens to telecommunications including the Internet.  Under that law the government of Argentina can set the rates for Internet access to ensure affordable access for all.  Just saying.]

Yay – the CRTC (which is an arm’s length tribunal so can’t really be part of the government’s strategy unless it isn’t that arm’s length) has instituted unbundling like the government said it would. No mention of the fact that we really won’t know the consequences of that decision for consumers and for broadcasters until it is implemented in 2016 or explanation of how that relates to a digital strategy.

Yay – the @Canada twitter handle exercises digital diplomacy. I dare you – go check out that twitter handle.

Screenshot 2015-07-15 14.22.22

Yay – the government created digital content through the NFB, funding the Canada Book Fund and the Canada Music Fund and digitizing publications for Library and Archives Canada. They actually have funded a great deal of digital content through the Canada Media Fund and their budget cuts have forced the CBC to be more innovative in using digital platforms but for some reason these are accomplishments the government does not want to brag about. I get the CBC point (it’s hard to brag about what someone has had to do when you slashed their budget) but CMF?? [They do describe Telefilm Canada as an audio-visual industry success story so I do wonder if someone at Industry Canada got confused and thinks Telefilm and the CMF are the same thing and doesn’t realize that Telefilm only funds features.]

The report does cover a number of other issues (I’m not going to even touch the reference to Bill C-51 as an example of Internet Safety) but those are of greatest relevance to an audio-visual industry. BUT. What the audio-visual industry called for in the 2010 consultations was vision and a plan to ensure that all Canadians had access to digital platforms and the choice to enjoy Canadian content when they got there. It asked for an overhaul of the various silo’d funding programs to have a coordinated strategy to fund single platform and multi-platform content in a digital world. It asked for funding mechanisms to ensure that Canadian content continued to be created even as business models and technology evolved.  It asked for training programs that ensured that emerging and more established talent had the skills needed to create and exploit content.

For a quick refresher on the agonizing pace of waiting for a National Digital Strategy that included content, see my post on the release of Digital Canada 150 on April 4, 2014 in response to the Industry Canada consultation in 2010.

So, we’re still waiting for some vision.

International Digital Media Co-Production: A Guide for Canadian Companies

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Today Interactive Ontario launched the International Digital Media Co-Production Guide for Canadian Companies.  I’m rather proud of it since IO hired me to research and write this report and it consumed a great deal of my Winter 2014.  I’ve given you the link to the report on the IO website but you can also find it on CMF, OMDC and Bell Fund’s websites (as funders of the study) and CMF also has a French version.

You should check it out if you’re interested in digital media co-production.  I spoke with a number of producers and stakeholders in Canada and outside to identify the advantages and disadvantages to this kind of business structure as well as the different business models that producers are experimenting with.  The report also has tips for how to get started in the international marketplace and a section that provides specific resources for UK, France, Germany, Australia and New Zealand.    It’s both a big picture report and a handy tool for producers.

Self-Promotion – CMF Blog Post on CBC’s Punchline

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I just wanted to let you guys know that I wrote another blog post for CMF’s Watch Squad, this one on CBC’s new online comedy channel (do not call it a portal) – Punchline.  It’s an interesting new venture that I’ll be watching both from the perspective of content creators (a new distribution channel that doesn’t require broadcast, a new way from a broadcaster to develop and test out material and talent) and as a solution to CBC’s funding woes as they move some of their content to the less expensive digital platforms.  It also plays into the CBC’s role as a public broadcaster and the constantly shifting perspective of what that means for those inside the CBC.  There are policy implications as that platform is unregulated.  That doesn’t mean much for Canadian content concerns since it is the public broadcaster and their focus is Canadian comedy but what about the other policy goals of the Broadcasting Act like accessibility, diversity and regional reflection.  What about accountability?  It may not be an issue now but it certainly should be monitored. 

I think Punchline is a great opportunity for comedy in Canada and I’ll be watching it’s development.  And I loved that I got to meet with comedy people at the CBC and pitch them on revisiting my fave CBC comedy show, “Michael Tuesdays and Thursday” – I couldn’t pass up an opportunity like that!

Is Primetime Still Important – You Betcha!

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The Canada Media Fund (CMF) has asked me to write the occasional blog post of television issues and my first one was released today. I just want to give a little more context to why I thought it was a necessary topic – space and tone were limited there (I had to sound more pro and less convo as I do here).

If you were listening to the Rogers licence renewal hearing last week you would have heard a reminder as to why a discussion about the continued importance of prime time is important. Or if you read Andrew Coyne today, you would get another reminder. Everyone seems to think that prime time is out the door or has one foot in the doorway. The stats say otherwise.

In the Rogers licence renewal hearing, Rogers argued that they did not need to broadcast ethnic news in prime time because their audience is going digital and can pick up all their news online. They would rather air reruns of US programming in that time slot and make more money. In a unscientific but illustrative poll, Commissioner Raj Shoan asked many of the intervenors if they or their stakeholders watched Omni and particularly the ethnic news online. Very few admitted to watching online and in fact most were adamant that they and their stakeholders wanted to watch their news on broadcast and in the evening. This was what they were used to. I’m sure that this was no surprise to Rogers. Though BBM data is notoriously difficult when it comes to capturing ethnic audiences (not large enough sample sizes) they must know from feedback from their audience that the broadcast schedule is important to them. Rogers still tried to make the argument that we are in an on demand world as a way of trying to reduce regulation and increase revenues. It sounded to me like the CRTC wasn’t buying it but we’ll see.

Today’s piece by Andrew Coyne puts the on demand world a little further out at ‘a few years, maybe two’ as part of his argument that we no longer need the CBC, CanCon, the CRTC and the Broadcasting Act. His argument ignores the facts, such as those quoted in my CMF blog post, which demonstrate that tv viewing is not actually dropping. The growth of on demand, currently at least, means that we are watching more video entertainment in total given the opportunities of digital platforms. So yes, for the foreseeable future we do still need the CBC, CanCon, the CRTC and the Broadcasting Act.  And regulation that ensures that there is the choice of Canadian programming in primetime when most Canadians are watching.

Content is Missing from Digital Canada 150

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First, let’s have a quick refresher course on our long wait for a National Digital Strategy. In the summer of 2010, then Minister of Industry Tony Clement launched a public consultation (together with the Ministers of Heritage and Human Resources) on what should be included in a National Digital Strategy though the government called it a Digital Economy Strategy and put a clear emphasis on infrastructure and economy.  [Note – I would link to the consultation but as of writing all those public documents are offline. I will update when I can.]. We were promised a strategy document in the fall, then spring of 2011 and then pretty much annually we’d be told that it would be coming ‘soon’. There were those of us who thought there would never be a National Digital Strategy.

Why do we need one? Other countries such as Australia, the UK, the European Union, and even the US, have created National Digital Strategies to set a plan and measurable goals. What are we going to do to move into the future, make sure that every citizen has the tools that they need, has the protections and can fully enjoy the benefits of the new digital world? How will Canada make sure that it is competitive internationally? How are we going to measure our progress? Where will we put our emphasis – economy, skills training, infrastructure, privacy, content?

Today the government released Digital Canada 150. It’s an odd document. It has five pillars: Connecting Canadians, Protecting Canadians, Economic Opportunities, Open Government and Canadian Content. [Note that Skills Training or anything else to do with the Department of Human Resources, one of the sponsors of the original consultation, is absent.] In each pillar it sets out a few items that are forward thinking and celebrates the government’s past achievements. I think we were hoping for a more forward thinking document. I was. As with a lot of the government’s activities these days, it seems to have been written with an eye on the next election. How else do you explain unbundling of TV channels as a Digital Canada topic? It’s a nice sound bite aimed at getting votes when the reality is that providing Canadians with more choice while still living up to the goals of the Broadcasting Act is a very complex exercise and is unlikely to result in both more choice and less cost for consumers.

There is a goal to extend broadband coverage to 98% of the population by providing $305 million to extend 5mbps to rural areas. This is a reasonable target speed (though some jurisdictions have set faster speeds as their goal) but is only about coverage. Universal broadband as a concept is about coverage and affordable access. Citizenship in today’s digital world means that every Canadian should have affordable access to broadband. This goal does nothing to achieve that. But the rural voters probably will love it.

Back to content though. What does the Digital Canada 150 promise us as tools to give Canadians ‘easy access to Canadian content that will allow us to celebrate our history, arts and culture’ (Digital Canada 150 pg. 21)? Two Heritage Minutes per year every year until 2017. The Canada Book Fund and the Canada Music Fund will become permanent funds. There will be continued support of the Virtual Museum, the Memory Project (veterans stories), digitization by Library and Archives Canada and the NFB. Nice, but we asked for a lot more fundamental changes to be able to provide Canadians with access to Canadian content in the digital age and beyond.

What is missing? Canada Media Fund, Canada Book Fund, Canada Music Fund and more have all had digital content or distribution tacked on to their existing mandates, generally with no increase to their funding. Consumers are no longer accessing or engaging with content through silos. For example, magazines and books are read on iPads with hyperlinks to video. There needs to be a comprehensive overhaul of the funding mechanisms for Canadian content to ensure that they meet the social policy goals of the Department of Canadian Heritage and are structured appropriately.

The government did make the Canada Media Fund permanent and that was a great thing. But it did not increase the CMF’s funding when it extended its mandate to digital media. As Canadians shift to digital platforms and cut or reduce their cable packages, the CMF’s revenue from the BDUs is starting to shrink. Additional revenue sources need to be found if Canadians are going to continue to have access to the excellent Canadian programming choices that they have now. This could be additional funding from the government or a contribution from the ISPs or the OTT services, both of which are benefitting from the consumer shift to digital platforms.

The Broadcasting Act and the Telecommunications Act should be merged into a Communications Act. New technologies and distribution models have frequently left the CRTC unsure as to which Act applies or whether either does, leaving it to the Courts to determine. Vertically integrated companies like Shaw, Rogers, and Bell are governed by both Acts at different times. These companies are able to shift revenues to divisions, such as the ISP divisions, with no or less regulation. A Communications Act would ensure that the Canadian broadcasting and telecommunications system was, where necessary, Canadian-owned and regardless of platform made the appropriate contribution to the production and exhibition of Canadian programming on that system.

The CBC has always had a mandate to provide information and entertainment to all Canadian across the country in both languages. Digital platforms make it easier for it to meet that mandate but at the same time repeated budget cuts have made it harder for the CBC to fulfill that mandate. There should be a review of the CBC’s mandate in light of the opportunities of digital platforms and a clear provision of sufficient funds so that the CBC can meet that mandate.

Another ask was for more support for original digital media through labour-based tax credits. Extending the film and video tax credit to web series and creating an interactive media tax credit would help develop a labour market of skilled talent in these newer digital content areas.

The government reformed the Copyright Act recently but it is up for review as of 2017. At that time, the Copyright Act should be amended to ensure that creators and owners are appropriately compensated when their works are exploited on digital platforms. The last amendment did not appropriately address that issue.

Skills training is a subject that was completely left out of Digital Canada 150, which is odd considering that it was a prominent aspect of the consultation. The content sector has called for improvements in training both at university and for mid-career training so that creators can take full advantage of innovations in digital content creation and distribution. There are gaps in the labour market that need to be filled if the sector is going to be internationally competitive.

Despite a full pillar titled Canadian Content, there isn’t much in Digital Canada 150 for the film, television and interactive digital media sectors.

 

Prime Time – Talking About TV

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The theme of Prime Time 2014 is Talk TV – the hashtag for the CRTC’s consultation with the public about the current and future Canadian broadcasting system.  A lot of the panels led into that theme.  But even if they didn’t, that’s pretty much all anyone was doing today – talking about TV.

After a breakfast burrito, large latte and talk about CRTC expenditure and exhibition requirements with my tablemates over breakfast, the keynote was an interesting talk by Wendy Bernfeld on the European VOD/OTT rights market.  Wendy came out of the Canadian broadcasting system but has been in Europe for about 20 years (I worked with her when she headed up the Atlantis Amsterdam office).  Her basic thesis was that there are now so many VOD buyers who are trying to acquire catalogues to either compete with Netflix or establish themselves before Netflix that this is now a good time to either make a lot of non-exclusive deals or a few big exclusive deals and reap the rewards.  For those making those European deals themselves, her slides will be very helpful just to help get to know who the players are and CMPA will be posting the slides at some point.  It was good to hear someone talk positively about revenue opportunities with OTT and in the fractured universe.  She also provided insight on the shifting windows of VOD – they no longer have a set order in windowing but can be before, during or after the main screen (i.e. theatrical or primary broadcast) release.  A good piece of advice for those dealing with broadcasters who have retained certain distribution rights was to cut those rights holders in to their deal so that the deal can be made and everyone win rather than just assume that it can’t be done because you don’t have those rights.

Rita Cugini (so strange not to be referring to her as Mme Cugini as I always did when she was a CRTC Commissioner) moderated a Talk TV Super Panel with Raja Khanna from Blue Ant, John Morayniss of EOne, Louis Audet of Cogeco, Kevin Crull of Bell, Michael Hennessy of CMPA and Christina Jennings of Shaftesbury.    As Blue Ant is a small group of independent services it was no surprise that Raja Khanna was an advocate of regulation, though he suggested that the key question was ‘regulation of what’.   At the very least that regulation needs to ensure that the small broadcasters have a place to ensure diversity in the system.   I did react negatively when he brought up the 17 year old YouTube sensation making ‘big bucks’ on that platform and cited that as the future of content.  In the first place, how many people are making that kind of money (I couldn’t find stats but I don’t think THAT many in Canada).  And second, it ignores the fact that people like to watch big budget dramas, which need broadcast partners to be financed.  Some people also like short form or edgy content that can be found on YouTube but mass market content like “Saving Hope” and “Big Bang Theory” will always be popular and need a platform.   Michael Hennessy pointed out that the evidence for this was that the top pirated content is all mainstream television.  [Devil’s advocate – why would they need to pirate YouTube videos?].

It always surprises me when I agree with anything that the top guys at Bell, Rogers or Shaw say, and truthfully, that doesn’t happen very often.  But Kevin Crull said a few things that I agreed with.  For one, he suggested that a problem with the CRTC’s TalkTV consultation is that people will always say that they only want to pay for what they watch but they forget the discovery process that they went to, to find that content.  You need the larger pool of content to pick from.  I do agree.  The other point that he made that I agree with was that with the business models under pressure we have to ensure that changes in the system don’t reduce the money that is available for Canadian content because it can’t be done for less.  Now I kinda think he’d like to do it for less but the point is no less valid.

The next panel that I attended was the Canadian Broadcaster Programming Panel.  I have to say that I was expecting it to be as boring as it has been in the past with programmers saying very little about what they were actually looking for.  We didn’t get a lot about what they want to buy but it wasn’t boring.  It started with an offensive comment from Bill Brioux (who I am otherwise a fan of for his reporting on Canadian TV, particularly as a resource for ratings) about how the programmers on the panel were all women and did that affect their programming decisions.  Yeah, that didn’t go over well with many people in the audience or the twittersphere.  I’d love to hear someone ask an all male panel (which happens SO often) if their gender affects their decision-making.

There were some good nuggets to pull out of the panel.  CTV is experimenting with niche content by doing a 6-episode order of a darker story adapted from a Giles Blunt thriller.  The CBC finds it difficult to program niche content since their CMF envelope is based on mass eyeballs (as is everyone else’s but there’s a political point there).  Sally Catto (CBC) does see an opportunity to aggregate an audience across multiple platforms and in that safely create niche content (which prompted me to launch a “Bring Back Michael Tuesdays and Thursdays” campaign – feel free to use the hashtag #bringbackMTAT – I know not likely but wouldn’t it be nice . . . ).  Both CTV and Global are trying again with comedy but as Corrie Coe pointed out ‘drama is hard but comedy is harder’.  It’s not about not knowing how to do it or not having the talent – it’s just hard and you have to keep trying before you get a hit.  [The US has a much higher ratio of failed tries to hits – commentators often forget that.]

Then we got into the dustup with Mr. John Doyle – or rather I unintentionally did when I tweeted that Corrie Coe disagreed with him and thought “Orphan Black” and “19-2” are both golden age shows.  See John Doyle’s column Where is Canada in the Golden Age of TV?  He took exception to my tweet; others took exception to his position that we don’t have great TV and should.  There was a flurry of tweets.  Broadcasters and producers and creators feel very strongly that Canadian TV is in general quite good these days and we have some really great shows.  The more important issue, for many, is that Canadian TV is really popular with audiences these days with shows like “Saving Hope” earning 1.6 million audiences every week.  [And for those who say it isn’t very Canadian – when was the last time one of the story lines involved a patient’s inability to pay their bill or having treatment refused by an HMO – think how often they were ER story lines – hmm?].

After that there was the fun question – what show would you like to steal from a competitor.  I would like to see that question become a staple of the Broadcaster Programming Panel as it tells you so much about the programmer and the broadcaster.  Sally Catto and Tara Ellis would both love to steal “Orphan Black”.  Corrie Coe would like “Lost Girl”.   Vanessa Case of Blue Ant, the only non-drama group on the panel would like “Amazing Race Canada”.  My only comment to those choices is – when exactly did Showcase become Space2 and except for the regulatory nature of service issue is this a problem?

More schmoozing at lunch (and explaining CanCon rules to a young producer because the CRTC Commissioner I was sitting beside wouldn’t let me inflict bodily harm) and then an interesting panel moderated by CRTC Chair Jean-Pierre Blais on the Future of Television.  Noreen Halpern (EOne) and Mark Bishop (marblemedia) were terrific – really passionate about creating content and needing the rules to evolve to be able to continue to support Canadian content.  They both see the day when there are no silos of funding or licensing because the platform is not relevant – you release it when and where it makes sense for the story.  That world is coming and we need to work now of the framework to support it so that we continue to have a robust Canadian industry in the future [that’s what I’ve been saying!].  I never really got the points that Tom Perlmutter (NFB) was making.

The New Business Models was a very popular breakout panel but I chose instead the International Markets panel.  I won’t write out all the really good tips here but I will Storify the whole conference and I encourage you to look for the specific advice given in this panel.  Experienced producers shared really specific tips about how to attend markets and go to pitch meetings and there were some great tips for both newbie producers and more experienced producers.  Some times you don’t think about comfy shoes.  I do find myself having difficulty ensuring that I get enough sleep at any event like a market while also ensuring that I leverage the social events and the scheduled events.  There just aren’t enough hours in the day.

Friday was mostly a day for Canadian feature films.  The issue that rippled through a few talks and panels was whether the solution to increasing audiences for Canadian feature films was online distribution or television broadcast.  I wish there had been a panel that had allowed Carolle Brabant (Telefilm) and Patrick Roy (CAFDE) to debate the issue since Telefilm seems firmly in the position that we need to get more Canadian features digitized so that they can be downloaded while CAFDE believes that Canadian broadcasters need to make more of a commitment to Canadian features since more people watch television than download.  I think a case can be made that both strategies could and perhaps should co-exist but they do play into different policy solutions.  Dave Forget of Telefilm presented a research study that provided a picture of feature film viewing habits of Canadians and that supported both positions – Canadians mostly watch features in the home and that is mostly but not exclusively on broadcast.  Online is of increasing importance.  The research also pointed out that Canadians pick features on the basis of genre, story and cast with director 6th and producer 10th.  This is of interest because Telefilm’s funding prioritizes producer and director and has always been more director-focused.

I have to describe to you my favourite moment of the conference.  It was unanticipated, unplanned brilliance.  The Governor General, His Excellency The Right Honourable David Johnston, came to be interviewed as part of a Canadian feature film promotion project that he’s working on with the CMPA and other partners.  Before he got up to the stage the Canadian women’s hockey team tied the score with moments left in the game.  Our GG is a huge hockey fan and it was such a pleasure to see him jump up and hold out two fingers in each hand to demonstrate that it was now a 2-2 game.  It was authentic.  When he was on stage though, the women scored the winning goal and his response was to lead us in O Canada while the screen behind him flipped to the live feed.  I’m tearing up just thinking about it again.  What a Canadian moment.  And that’s what we’re all about when it comes right down to it.  Sharing our stories with each other.

You may ask how I felt about Prime Time – was it worth going?  Yes.  I always see people, both Toronto people and those from around the country, and it is important to connect, especially for me in my independent consulting career.  I had a few business meetings.  I promoted a few clients to other stakeholders.  There is one more young producer who understands how our Canadian Content support system works and why.  I picked up a few interesting bits from the panel sessions.  Should you go?  Well, honestly, it depends on what you do in the industry.  There isn’t a lot at Prime Time for digital producers except the ability to meet TV producers (who won’t be showing up at digital conferences – this is a problem).  There isn’t much for creators unless you are also trying to manage the business side of production because this is a business conference.  If you are a producer or work with producers or need to meet producers then you should come to Prime Time.

I’ve updated this post with my Storify of Prime Time 2014 tweets.  It isn’t as complete as I would have liked because Storify and Twitter just didn’t co-operate and at times wouldn’t show me tweets that I knew were there – sigh.  But you can get a feel for things if you weren’t there.

CRTC’s Tangible Benefits Policy Review

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The CRTC is currently in the midst of a review of its Tangible Benefits Policy.  This is the policy that requires purchasers of television and/or radio assets to pay a percentage of the purchase price to programs that will benefit the entire broadcasting system.  This policy was initially put in place because while there is a competitive bid process to acquire a licence in the first place, there is no such competitive process when purchasing the assets of an existing licensee.  The CRTC decided to institute the Tangible Benefits Policy to help to ensure that the prospective purchaser was the best possible purchaser (i.e. had the assets to pay the benefits package as well as the purchase price) and that the entire broadcasting system would benefit from the transaction and not just the shareholders of each entity.

Over the years tangible benefits have been assessed on a case-by-case basis but in accordance with policies and precedents that have been established.  At times this worked well and proposed benefits would fit roughly within the established practice and stakeholders would focus on the value of the transaction or aspects of the proposed programs that they wanted tweaked.  However, once the BDUs started buying the broadcasters they got aggressive with the benefits packages and we started seeing self-serving proposals and ones that had nothing to do with the policies or sometimes even the broadcasting system (see Shaw-Global and Bell-CTV (2010)).  This took up a lot of Commission staff time and stakeholder time as part of the public hearing process.   From my perspective the worst development was when purchasers started coming up with new proposals during the hearing and trying to negotiate their benefits packages at that time.  Stakeholders had to scramble to get enough of an understanding of new proposals to be able to comment on them in their presentations or reply interventions.

So the Commission is now reviewing the policy to try to streamline it so that there are very clear guidelines for how to prepare the Tangible Benefits packages.  You might be asking yourself why now when there are no big benefits packages in our future.  My response to that is – says who?  I have heard many times over the years the statement that there are no more possible acquisitions because the media consolidation process has been completed, yet acquisitions keep happening.  For example, Bell has acquired CTV twice and each time had to pay benefits.  You just never know what the future will hold. 

The Commission issued its call for comments on a proposed revised policy on October 21, 2013 and the first submissions were filed January 13, 2014.  There is a right of reply and those will be filed by January 28, 2014.  We can then expect a decision from the Commission some time in the early spring.  Note that the Call for Comments also included comments on a revised valuation policy but that gets into accounting and valuation policies that would be better left to accounting professionals to comment on.  I’m also focused here on television rather than the radio benefits policy, which is similar in concept but slightly different in the detail.

Generally the CRTC is proposing that rather than the bulk of tangible benefits being self-administered by broadcasters for their own programming, 80% would go to the CMF and the Certified Independent Production Funds (“CIPFs”) with the other 20% being discretionary (i.e. social benefits but could also go to independent production or digital media production).  The breakdown between CMF and CIPFs would be the traditional breakdown of BDU revenues between those agencies, namely 80% to CMF and 20% to CIPFs. 

The initial submissions are somewhat predictable.  All the private broadcasters are against the benefits policy to begin with.  They ignore the fundamental reason for it (lack of a competitive licensing process at that stage) and call it a ‘tax on purchasers’ (Corus) or no longer needed because there is plenty of other production financing (Rogers).  If the Commission must continue the policy then they would like to keep the current case-by-case approach since that allows the most flexibility.   For them.  [Note that the CBC is in favour of the revised Tangible Benefits Policy as it would mean that they, or their producers, would get access to funds that they do not generally have access to.]

On the other hand, the content creators who have been major beneficiaries of the Tangible Benefits policy generally support the CRTC’s proposed new policy but would like to see a variety of tweaks to the proposal.   For example, DOC would like to see a portion of the benefits go to a non-broadcast fund.  The CMF and CIPFs all require a broadcast trigger, which is generally fine except that DOC is finding that broadcasters increasingly do not want to air documentaries.  As an organization they are exploring other avenues to get to documentary-loving audiences and this proposal furthers that goal.  

Most of the content creators would like to see the split 85% on screen and 15% discretionary, consistent with past practice (though DGC would like to see it 83.33% on screen and 17.67% discretionary).  CMPA points out that the increased split will make up for the fact that as a third party fund, the CMF and CIPFs will have administrative costs that will need to be deducted (though strangely the WGC doesn’t think they should be able to deduct admin fees because the additional administration would be minimal – I don’t think they’ve been on either side of a production financing application).    

One of the arguments that a few stakeholders made to support money going to the CMF is the trend that we’ve started to see towards lower BDU revenues and therefore a drop in their contributions to the CMF.  Future benefits are seen as a way to make up for the expected growth in revenue shortfall.

There is some concern that the CMF’s funding criteria under its Contribution Agreement is much more limited than Tangible Benefits have been over the years.  The CMPA called for benefits money being spent by CMF and CIPFs consistent with the Tangible Benefits Policy rather than the Contribution Agreement or other existing criteria.  That would mean, for example, that the language split would be in accordance with the language split of the assets being acquired rather than the 2/3-1/3 of the CMF.  It would also mean that some of the categories of programming that have had access to benefits (eg. feature films and local news) but are not supported by CMF and the CIPFs, would somehow still have access.

It’ll be interesting to see the replies on January 28, 2014, if there are any.  I’m not sure that there’s really much more to say.  Many of the points of the content creators can be worked out in a more defined policy – and many of them are quite valid points in my opinion.  I don’t see the Commission agreeing with the broadcasters that the Tangible Benefits Policy should be thrown out the window or that the Commission continue with the case-by-case approach.  It was just too much work for everyone involved (well – except maybe the purchasers who seemed to be coming up with vague proposals the day they submitted their applications). The recent Corus decisions seem to have signaled that self-administered benefits have had their day.

 

CRTC’s Corus Decisions – A Few Lumps of Coal In With The Presents

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C’mon – I had to go with a holiday themed subject line on the last real working day before the holiday break.

Yes, the CRTC decided that it was in the public interest to allow Corus to buy the Teletoon services and Historia and Séries+.  The interesting stuff (for a CRTC watcher like myself) is in the detail.  A lot of detail.  Don’t worry, I do have holiday baking to do so I’m only going to touch on what are for me the most interesting points.

A lot of people were watching the Historia and Séries+ part of the hearing to see whether the CRTC would agree that benefits would only be payable on the half that Corus was buying from Bell and not on the half that they were buying from Shaw.  There has been a lot of confusion on whether Shaw and Corus are related or not (even at Shaw and Corus).  There have been long rumoured plans for Shaw to take over Corus fully but a requirement to pay benefits would make that a costly reorganization.  Well, it looks like they can go ahead.  In both the Historia and Séries+ decision and the Teletoon services decision, the CRTC made a clear statement on how they see Shaw and Corus.  Are they one or two?  Depends.

For the purposes of determining effective control, Shaw and Corus are considered part of the same ownership group as they are both controlled by JR Shaw.  But when applying the group-based licensing policy, Shaw and Corus are two designated licence renewal groups. [para 14 in Teletoon and 18 in Historia and Séries+].  So – no benefits are triggered by the acquisition of the Shaw ownership of Historia and Séries+ and none will be triggered when Shaw buys Corus.  I’m not sure that I agree but the clear statement is helpful.

The decision clears up what has been a very odd situation with Terms of Trade and Teletoon.  While Teletoon’s owners Bell and Astral had both signed a Terms of Trade agreement with the CMPA, Teletoon said that it was not a signatory so took the position that the Terms of Trade didn’t apply.  Well, it does now and it is a condition of licence for all Corus properties.  The CRTC took it further and requires Corus to enter into a Terms of Trade agreement with the AQPM (the French producers in Quebec) within one year and to start negotiations with APFC (the French producers outside Quebec).

The benefits payable under both decisions have been increased.  For Teletoon they were increased from $24.9 million to $26.02 million to reflect leases and cash on hand.  For Historia and Séries+ the increase was from $13.86 million to $14.48 million to reflect cash on hand.  The one thing we can always count on is that the valuation will go up because the CRTC found one or more ways that the purchaser tried to reduce the benefits payable.

Most of the benefits proposed have been accepted.  What interesting is the additional requirements.  The self-administered benefits cannot be spent on production just for Corus properties (generally the benefit of self-administering benefits).  ‘Benefits should be used to create and acquire the best possible Canadian programming to be made available on whatever services Canadians choose.  As such, the benefits resulting from this transaction should be made available to a wide range of producers for broadcast on a variety of services so that they do not exclusively benefit the Teletoon services’.  [para 73.  The same line is in the Historia and Séries+ decision at para 72.]  Corus might as well give the money to the CMF or other independent funds if it can’t be run out of their commissioning department.  Combine this with the proposed benefits policy that has 80% of benefits going to independent funds and we have a clear signal of the impending death of the self-administered benefits fund.

Corus had proposed that 75% of production benefits would go to independent production.  This was of concern for many as Corus owns Nelvana and that 25% would therefore go to its own productions.  The CRTC agreed and Nelvana was cut out of benefits.  They will go 100% to independent production.   Yup, that’s definitely a piece of coal.

In the Bell-Astral decision we had what I believe was the first allocation of a portion of benefits to OLMCs.  Keeping in mind that the Chair of the CRTC and the Vice-Chair of Broadcasting both grew up in OLMC communities, it is not that surprising that there is a renewed interest in supporting OLMC communities.  [and I will add OLMC to the Acronym Decoder].  Both decisions require 10% of the programming benefits to go to OLMCs, consistent with the Bell-Astral decision.

There are two funds that still need to be finalized in both decisions, the Script and Concept Development Fund and the Export Fund.  Stakeholders had objected to the Export Fund as not being an onscreen benefit (Corus had been very vague in its application and at times described it both as a fund to promote programs internationally and as a way to help producers find international financing) but to ensure that it will be an onscreen benefit the CRTC has required that any funds will result in the production of new programs and that those programs are broadcast on a Canadian service.  Effectively it is a ‘foreign presale’ fund rather than an after market distribution fund.  Corus has until January 30, 2014 to file an agreement with either Telefilm or CMF for these two funds.  If Corus can’t come to an agreement with either Telefilm or CMF then the funds will go to the self-administered (but not for Corus’ benefit) funds.

The filter that benefits must be of a benefit to the entire broadcasting system has also been applied to the offscreen or social benefits.  Frequently in the past there have been tenuous connections between the recipients of social benefits and the broadcasting system (I remember an allocation to the Girl Guides of Canada that didn’t make much sense).  The CRTC is being very clear that Corus will have to report on how the funds were used to the benefit of the broadcasting system and hinted that a proper use would be script development, pitching events, professional development and the opportunities to meet OLMCs.  One social benefit, the Corus Inner City Childhood Obesity Research Initiative, was denied for not being clearly of benefit to the broadcasting system (and being very vaguely described in general).

There were a few changes to the licence terms of the Teletoon services that will be of interest.  Corus requested a CPE for Teletoon of 31% but the CRTC set it at 34% with an allocation of 9% specifically to French language programming to allay concerns that collapsing Teletoon into the Corus group could swamp French programming.  Teletoon’s PNI is set at 26% and Teletoon Retro’s at 4%.  That effectively increases Corus’ group PNI from 9% to 12%.  This is all good news so hopefully when the benefits expire Corus will still be spending healthy money on Canadian programming.

The CMPA had requested a condition of licence that Teletoon air 90 hours of Canadian programming as well as the expenditure requirement.  The CRTC did not approve it on the basis that they are leaning towards regulation that focuses on creation rather than exhibition in order to keep pace with changing audience behaviour and provide broadcasters with greater flexibility.  This was also a theme in the Group Licensing Policy, though that policy did not completely get rid of exhibition requirements.  What I find interesting though is that the Commission also denied Corus’ request to remove the requirement to air one hour of Canadian programming during prime time on Teletoon Retro.  That was on the basis that the Commission didn’t want Teletoon Retro to have a completely foreign prime time broadcast.  So exhibition requirements are still sometimes necessary.

There is more nitty gritty in the decisions but my holiday baking calls.  Happy holidays to you all!  Hopefully you can take a proper break and I will see you in the new year.