Consultation process debated in wake of changes to Telefilm multimedia fund

Telefilm Canada’s multimedia fund will undergo wholesale changes, according to a confidential discussion paper obtained by Canadian NEW MEDIA, but many industry leaders are still displeased with what they perceive as a lack of consultation on the issue. In draft guidelines distributed September 26 to a select group of advisory committee members, the agency outlines a new project evaluation system and funding mechanism in line with what industry experts and auditors Ernst & Young have recommended. But questions remain about ambiguous wording in the confidential document that apparently leaves the door open to broadcasters and affiliated portal companies to grab a hefty portion of distribution and production assistance fees. A last-minute plea has been entered by the Canadian Film and Television Production Association (CFTPA) to clarify the language, along with a slap on Telefilm’s wrist to include the group in future consultations on the issue. The CFTPA’s position on an open process is shared by several industry players also excluded from the advisory committee who say privately that the consultation to date has been lax. The CFTPA, says one source, had only two days to respond to draft guidelines after it insisted on being given a copy – a schedule that was eventually changed after appeals to Canadian Heritage were made for more time. CFTPA president Elizabeth McDonald wouldn’t discuss specifics with CNM, but acknowledges that there was unease about the process. "One of the issues we had concerns with is that we were not consulted in the first round. That was the…point that we were making, that we represent new media producers," she says. "We have some very experienced new media producers and it was important to talk to us. So, we’re trying to get the attention of the government through this process… We’re not trying to hold it up, it’s just that it’s very clear we have an interest in interactive producers, that we have significant members. But, they didn’t come to us. "Part of what we bring to the table is not only that membership representation, but a long experience with how these funds work. It is really of great concern that it’s taking so long to do this," she adds. "Particularly as the economy becomes more difficult, there’s going to be a lot of potential new media creators who, perhaps, are never going to get there, now. That’s a serious concern." In an October 24 letter to Telefilm, obtained by CNM, the association says, " are very much aware that the Fund is long overdue and its implementation eagerly anticipated. At the same time, given the importance with which the Fund is viewed by our New Media members, we feel it is essential that our views be considered seriously before the guidelines are finalized and the Fund implemented." The letter goes on to state in its conclusion: " CFTPA New Media Committee has not had any formal link with Telefilm or Canadian Heritage through the Fund’s advisory body, we would like to suggest that our representatives become members of that group. We would also strongly suggest that the group continue to play an active advisory role to Telefilm and to the Department, during the implementation of the Fund, to provide essential industry input into Fund direction and policy. If the Fund’s objectives are to be met, it is important that new media producers have a strong voice in how it will operate." Besides Telefilm staff and Canadian Heritage’s director of innovation and multimedia, René Bouchard, the advisory committee is made up of nine industry members: Freydis Welland, a director of New Media BC; Paul Allard, ZAQ Technologies Inc.; Daniel Boismenu, Alliance Numériqc; Leif Storm, a board member of Tyndal Stone Media Inc.; Jim Folk, president of Minds Eye Interactive; Collideascope’s Steven Comeau; IMAT’s Kren Clausen; and Delvinia Inc.’s Sam Punnett. Telefilm argues process was open Telefilm has been quick to counter any notion that the consultation process to date has been closed. "Telefilm Canada has always worked in consultation with the industry to develop appropriate guidelines that respond to the industry’s needs," agency spokesperson Janine Basile tells CNM. "And, as we did in the case of the Canada Feature Film Fund, it’s the same with the multimedia fund. So, therefore, we worked with the advisory committee that’s composed of various Canadian associations from across Canada. A certain number of members are part of this consultation committee. We work together to develop guidelines… I just want to make sure that you understand that the process is open, transparent, and we do, of course, share information with members of the committee." Bruno Légaré, head multimedia analyst for Telefilm, adds that discussions haven’t yet ended. "The consultation process is not over. The discussions with the department are not over, yet. The guidelines aren’t finalized." He notes that Telefilm won’t make any guidelines public until the fund is officially launched sometime in the near future. Now that the CFTPA has Telefilm’s ear, and consultations have been prolonged, one of the new guidelines apparently back on the table deals with eligibility – particularly contentious access for large broadcast entities and portal operators. In its letter, the CFTPA suggests that funds, especially those earmarked for production and sectoral development, be reserved for "independent new media companies". TV decision could serve as Telefilm modelSpecifically, it has argued that Telefilm could use a recent decision on independence in the television sector that defines independent as having less than 30% interest from a broadcaster. "This would allow the Fund to focus on encouraging small and medium-sized companies through content production and sectoral assistance," the CFTPA writes. "Broadcasters and affiliated companies could be eligible to apply for distribution assistance. Given the limited funds available within the Fund and the need to stimulate the vibrancy of the sector, it only seems logical to target public funding access to those production entities who are not able to cross-collateralize production costs against significant revenues from other sources. "We would absolutely agree with the need to encourage partnerships with broadcasting and other distribution entities to ensure maximum distribution of fund projects, but actual access to production and sectoral support funding should be limited to independent producers." This stand is in response to a change in wording in the new fund guidelines, which now states that production assistance will be available to " Canadian private companies and independent new media development, production, offline publishing or online operating companies" that meet certain Canadian control and financial criteria, as well as operating principally as a new media entity. In its definitions, the agency defines an online operating company as a "company that operates a site on the Internet or other online service for the purpose of providing online content." Wording from the original guidelines that gives "priority" to small- and medium-sized companies remains. Tempest in a teapot? One CNM source, however, suggests that the debate may be a tempest in a teapot – an assertion backed up by Telefilm’s Légaré. While the wording has been changed with some new definitions, both Telefilm and some industry sources feel eligibility has remained essentially the same. Says Légaré: "There are changes, but they’re very minor. So we might not use multimedia anymore; we might discuss the involvement of companies in new media, but it’s not very different from what you have. You have the definition of eligible applicant in the guidelines and what they must present as qualities like being Canadian or financial stability to provide the expertise and experience to deliver. This hasn’t changed very much, this paragraph." Asked why the CFTPA might be bringing concerns about eligibility to the fore at this point, Légaré says he’s unsure. "Well, if you look at the actual definition, maybe they’re wondering what kind of partnerships they could get into with broadcasters. From there, they create interpretations or they envision consequences or the like." But, he says, the guidelines remain essentially unchanged from their first drafting in 1998. More important, say both Telefilm and industry sources, is the change to an equity model as demanded by the sector. Arguments over broadcaster eligibility, some say, is delaying implementation of the fund – a blow to other development funds such as the Bell Broadcast and New Media Fund, which often require Telefilm funding before those investments can be made. Blame for the delays, however, is being laid at the feet of the department and Telefilm, not those bringing up sticking points. Had the agency followed up consultations held at the Banff Television Festival in a timely fashion, some of the speed bumps could have been avoided, say some familiar with new media funding programs in this country. Besides a heavy emphasis on broadcaster and others’ eligibility, the CFTPA letter is also critical of a new evaluation system that places heavy emphasis on CanCon. "Selection criteria should also not be strongly weighted in favour of Canadian themes and subjects, to the point where they eliminate projects with strong creative and marketing plans yet with less distinct Canadian themes, elements or stories," states the letter. "Creation and distribution of new media products by and for Canadians should be the primary objective here…" For the first time, likely in response to a confidential auditor’s report by Ernst & Young (CNM, Nov. 2/01), there is a clear evaluation process set out in the latest iteration of the fund guidelines. The criteria assign 20 per cent of the selection points to Canadian cultural content, including the production team and creative talent, subjects, themes and concerns, and the cultural diversity of the subject matter and content. The other 80 per cent of points is assigned to the project concept (15 points), technology (15 points), financing (15 points), marketing (20 points) and "corporate information" (15 points). As several industry sources have indicated both publicly and privately, the fund’s cultural goals are contentious as industry would prefer the fund eliminate cultural content in favour of market development. "Are they going to be pushing for cultural content, whatever that means to them, or are they going to be looking to develop an industry? Bottom line, that’s what it’s about…," Delvinia’s Sam Punnett tells CNM. "If they’re going to be talking about cultural content, they’re going to be talking to the hobbyists, because nothing can stay in the business unless it’s commercially viable, exportable. Those go together. I’ll stand by the fact that there’s no market in Canada for cultural content," he argues. "Where the confusion happens on the government level is they’ve got this vision that content is some kind of a money maker if it’s pressed onto CD-ROMs and put into stores. It just ain’t so. I think the Canadian Encyclopedia proved that."

Consultation process debated in wake of changes to Telefilm multimedia fund

Broadcast | November 15, 2001

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