Tag Archives: CMF

Creative Canada – Sounds Good So Far

You can see my summary of the relevant (to primarily tv) parts of the Creative Canada strategy at TV, Eh here.

For my interactive digital media people there are a couple of other interesting points to make.

If the s. 15 report from the CRTC triggers a public consultation, the terms of reference give producers the opportunity to explain how affiliated digital media are essential for discoverability of television programs.  That could potentially lead to changes in the Certified Independent Production Fund framework.  It’s a long shot but if the door is open you might as well try.  [more to follow in a future blog post about the new Bell Fund programs]

Heritage created a Creative Industries Council to be run jointly by Heritage and ISED, which will advise both departments on how to enhance collaboration between industries and allow the creative industries to grow.  IDM is all about collaboration and often straddles culture and innovation so there are opportunities there to influence policy to support IDM industries, depending on who is appointed to the Creative Industries Council and what it’s specific mandate is.

Creative Hubs will receive funding to support creative startups to help them create, collaborate and innovate.  There’s a lot of potential here for hubs that will support IDM startups.

As IDM could not access the old PromArts and Trade Routes programs, IDM producers should be eagerly waiting to see the details of the new Creative Export Strategy Fund to ensure that it covers IDM and the kinds of export activities that will enhance their success.

I guess we’ll just have to stay tuned.

P.S. Oh and a rant is required.  Phrases like ‘many of Canada’s federal cultural institutions and funding programs will have implemented concrete measures to make our creative industries more inclusive, by increasing opportunities for women’ drive me mental.  Diversity and inclusion is not synonymous with gender parity.  Could the government please get working on programs that encourage a wider diversity of talent, stories and decision makers so that our media is more reflective of our audience?

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CMF Consultations – Should You Care? Yes.

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.

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

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.

Is Primetime Still Important – You Betcha!

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

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.

 

Project Funding Application Tips – 3

This is the third in my ongoing (though irregular) series of posts on Project Funding Application Tips (see here and here for previous posts).  They are tips that I’ve come up with after reviewing an awful lot of applications for a variety of funds.

  1. I can’t believe I have to say this but leave your cutesy bios on your website (if you must).  I don’t care if you like rainbows and kitty cats and rock climb in your spare time.  I want to know if you have the necessary skills and experience to do the job.
  2. If your website is going to have a lot of videos and some of them will be exclusive and some of them will be edited footage from the television show (e.g. bloopers), the budget for video cannot be assessed unless the evaluator has an idea of how many videos will be original and how many will be edited.  Even a ballpark will help.
  3. If something that you want to produce is going to be more expensive than normal ranges, you have to explain, in detail, why it will be more expensive.  Without that explanation some evaluators will cut the budget and/or the amount funded while others will reject an application completely.  Whatever the reason for the higher expense – sell it.  If it is a digital project and the higher expense is due to more content then you have to explain just how much content will be produced. If it is a drama and the cast is huge that should be obvious in the scripts but there will be other cost categories that will not be so obvious and they need explanation.
  4. If you are applying for funding for a second or later season, don’t assume that the evaluators are familiar with your show.  An episode of the earlier season is not enough.  You need to include a bible or other document that explains who the characters are and a summary of what happened in each previous season, particularly if there are story arcs that relate to the current season’s story.  It’s hard to evaluate creative when you don’t have any clue what’s going on.
  5. Comedy is hard but applying for funding for a comedy project is even harder.  Depending on the kind of comedy it might not come across from the script (I can remember laughing out loud while reading a goofy boys animation script but that’s rare).    Communicating the funny can be particularly hard when writing an outline or a concept document.  Short clips can go a long way to communicating the funny.  If you go that route though, make sure the clips really are funny.  They should also be well performed and edited so that the evaluator isn’t distracted by things that can be easily improved in production.
  6. Be consistent when applying to different funds.  While there may be different goals, eligibility requirements and guidelines between different funds the project should still be fundamentally the same.  If it isn’t there is a strong possibility that this will be noticed.  Yes, funders talk, especially when a project is complicated or brings up unique issues.  They also sometimes use the same evaluators so you always run the risk of someone saying ‘hey, I saw this project when it applied over here and it was different’.  Don’t do that.
  7. Speaking of other applications, if you are making multiple applications be sure to have the right name on your documents.  Make sure that your cover letter does not say ‘Dear Andra’ if it is going to the Shaw Rocket Fund.  Change the footer from ‘CMF Experimental’ to ‘Bell Broadcast and New Media Fund’.  Seriously – I’ve seen this mistake made.
  8. When you are applying to multiple agencies be careful about trying to shoehorn the same documents into each application.  Make sure that you address the needs of each application separately.  Funders want to know that you have taken the time and attention to focus on their guidelines and addressed their requirements.  Sometimes its just confusing when you give a funder information that they haven’t asked for.

 

 

 

CRTC’s Tangible Benefits Policy Review

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.