Eliminating Cancon quotas could ghettoize it, says CFPTA’s Bolen

A recent policy proposal to replace Canadian content quotas with direct subsidies risks “ghettoizing” Canadian content on select channels like the CBC, says Norm Bolen, president and CEO of the Canadian Film and Television Production Association (CFTPA). Bolen’s comments came in response to a report released Thursday by the C.D. Howe Institute. The report, titled “Scrambled Signals: Canadian Content Policies in a World of Technological Abundance,” addresses the policy framework for the English Canada communications industry, and says important regulatory instruments that in the past promoted and protected Canadian content are not viable in the Internet age. “The transition from a push network, where entertainment choices were limited to that available at a given time, to a ‘pull’ network, where content is available on demand, will render many current tools obsolete,” it says. Among the report’s recommendations is a proposal for the CRTC to phase out its quotas for Canadian content and replace them with direct subsidies. After reviewing the report, Bolen told The Wire Report he is concerned about abandoning the quota system “and going completely to the supply-side” of investment in Canadian content. He said “Canadian shows are doing better than ever,” and although subsidies could help generate good Canadian content, broadcasters would not be required to show it without exhibition quotas. “Increasingly the Canadian content that’s produced—even if it’s very good—becomes ghettoized in one or two places,” he said. “You need to have shelf space. You can create all the Canadian content you want, but if there are no platforms on which that content is available, you’re defeating the purpose.” Current regulations require scheduling and expenditure quotas to ensure Canadian content on the airwaves. Under current scheduling quotas, licensed broadcasters must ensure that at least 60 per cent of their content per year is Canadian programming, and that 50 per cent of it is aired in the evening. The CRTC also stipulates that large, multi-station television broadcast groups air eight hours per week of Canadian “priority programming” during peak evening hours, such as Canadian drama, dance, music, variety, documentary, regional, and entertainment programming. Commercial radio stations must also ensure that at least 35 per cent of their music is Canadian. The CRTC also traditionally required that broadcasters spend a portion of their revenues on Canadian programming—such as acquiring or producing Canadian drama—but this requirement was eliminated in 2000. Specialty channels are mandated to meet expenditure requirements through conditions placed on their licenses. The report was authored by Stikeman Elliott counsel Lawson Hunter as well as Edward Iacobucci and Michael Trebilcock, both law professors at the University of Toronto. It says “the media universe has evolved to a point where consumers have almost infinite choices of what to view, when to view it and on what medium to view it.” Many of Canada’s regulatory instruments intended to promote Canadian content “are being rendered obsolete,” it says. The report recommends: phasing out the current Canadian content quota system “relating to time and expenditure allocations”; establishing new direct subsidy programs and sources of revenue to replace the quota system and “support the creation and promotion of Canadian cultural content”; loosening the regulations addressing the “Canadian ownership of private broadcasters … will become increasingly impractical”; subjecting broadcast distributors to “ongoing oversight with respect to access and discrimination issues to prevent any market power abuses, at least in the near term”; bolstering the CBC “with sufficient funding to ensure significant outlets for Canadian content”; and appointing an independent expert panel to “undertake a comprehensive review” of the regulatory framework and report to the federal government within a year. In an interview, Hunter, a former executive at Bell Canada, acknowledged that the production community could feel threatened by proposing to phase out the quotas—but it makes sense as consumers move from a “push” to a “pull” distribution system. He suggested that direct funding for Canadian content could come from levies or general government revenues. “What we’re really proposing is a fair amount of deregulation. If you think about the quotas, how do they get imposed? Some of them are by regulation, but a lot of them are by conditions of licence,” Hunter said. “If you stand back, I think it’s a pretty balanced package.” Hunter said the proposal to create an expert panel to consider Canada’s regulatory system would be a way to “depoliticize” the issue and establish a reference point for future changes. Bolen said regulatory change should not happen in a vacuum, and that he would like to see a broader, “national discussion” toward the development of a national digital strategy. The discussion should consider, in addition to regulatory change, broadband distribution, infrastructure, connectivity speeds, copyright and security issues. “We do have to move to new models—there’s no question,” Bolen said. “People are not exaggerating when they say that the impact of the digital revolution will be greater than the impact of the industrial revolution, and we’re in the early stages of it.”

Eliminating Cancon quotas could ghettoize it, says CFPTA’s Bolen

Broadcast | January 29, 2010

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