CCA Urges the CRTC to Create a Fund for New Media Productions

CCA Bul­letin 5/09

Feb­ru­ary 19 , 2009

Just the Facts

Ten years after decid­ing not to reg­u­late inter­net and two years after extend­ing that deci­sion to wire­less ser­vices, the Cana­dian Radio-television and Telecom­mu­ni­ca­tions Commission’s (CRTC) has reopened the issue. The Cana­dian Con­fer­ence of the Arts (CCA) was the first wit­ness to appear at the Hear­ing on New Media which started ear­lier this week in Gatineau (Québec).

In his open­ing state­ment, CCA’s National Direc­tor Alain Pineau urged the CRTC to rec­og­nize the fact that inter­net and wire­less are part of the Cana­dian broad­cast­ing sys­tem and as such, must con­tribute to the pur­suit of the cul­tural objec­tives set by Par­lia­ment in the Broad­cast­ing Act. Stud­ies show that between 50 and 70 per­cent of traf­fic on the New Media is either straight­for­ward broad­cast­ing, or akin to broad­cast­ing as it is tra­di­tion­ally defined.

The free ride for ISPs and wire­less providers should come to a speedy end. Cana­dian artists, cre­ators, arts orga­ni­za­tions and enter­prises would ben­e­fit greatly from the imple­men­ta­tion of a sim­i­lar con­tri­bu­tion require­ment cur­rently imposed on broad­cast­ers, cable and satel­lite dis­trib­u­tors. The con­tent that could be gen­er­ated by such a fund would cre­ate new oppor­tu­ni­ties for the cre­ative econ­omy both at home and in sub­se­quent inter­na­tional markets.

In this con­text, the CCA has urged the CRTC to require Inter­net Ser­vice Providers (ISPs) to con­tribute 3% of rev­enues to a fund for the pro­duc­tion of broad­cast qual­ity Cana­dian con­tent for the Inter­net. Other broad­cast dis­tri­b­u­tion under­tak­ings (i.e. tra­di­tional over the air broad­cast­ers, cable and satel­lite dis­trib­u­tors) are cur­rently required to con­tribute 6% of rev­enues for the pro­duc­tion of music and audio-visual pro­gram­ming. The dif­fer­ence in per­cent­age reflects the pro­por­tion of broad­cast mate­r­ial esti­mated to tran­sit on new media.

Tell Me More

For the past three years, the CCA has taken every occa­sion pos­si­ble to urge the CRTC to review its deci­sion to exempt new media from any form of reg­u­la­tion. The CCA’s posi­tion, which is val­i­dated by the lat­est infor­ma­tion avail­able, is that the so-called new media actu­ally act in large part like tra­di­tional dis­tri­b­u­tion plat­forms, with the added advan­tages of inter­ac­tiv­ity and highly cus­tomized on-demand capacities.

It is impor­tant to stress that the CCA is not sug­gest­ing that the CRTC reg­u­late user pro­duced mate­r­ial, nor is it sug­gest­ing that any restric­tions be imposed to access­ing any web­site around the world nor any restric­tions to free­dom of speech, beyond those already imposed by the Crim­i­nal Code.

How­ever, the CCA is con­vinced that it is essen­tial to devise appro­pri­ate reg­u­la­tions to make sure that the “new” media make a finan­cial con­tri­bu­tion to ensure a strong pres­ence of Cana­dian cul­tural prod­ucts on these new plat­forms. The ben­e­fits of extend­ing the con­tri­bu­tions to Inter­net Ser­vice Providers will accrue directly to Cana­dian artists, cre­ators and arts orga­ni­za­tions and enter­prises that par­tic­i­pate in the cre­ation of new Cana­dian web content.

The CCA has accord­ingly urged the Com­mis­sion to imple­ment a frame­work for reg­u­lat­ing under­tak­ings that receive sub­scrip­tion, adver­tis­ing and/or pub­lic fund­ing from broad­cast con­tent, regard­less of the trans­mis­sion con­duit that car­ries that con­tent to audi­ences. This approach cre­ates a new and sig­nif­i­cant source of fund­ing for the devel­op­ment of Cana­dian web con­tent by artists, cre­ators, arts orga­ni­za­tions and enter­prises to sup­port and encour­age inno­va­tion and creativity.

Cur­rently licensed broad­cast­ers who stream on the inter­net and offer com­ple­men­tary ser­vices should be sub­ject to the same reg­u­la­tions con­cern­ing the pro­duc­tion, exhi­bi­tion and pro­mo­tion of Cana­dian cul­tural prod­ucts. The CRTC should not ignore thirty or forty large legacy broad­cast­ing groups that are reusing, recy­cling and repur­pos­ing their exist­ing radio and tele­vi­sion con­tent to give it new life online, to attract new rev­enues and to sup­port and com­ple­ment their tra­di­tional broad­cast­ing activities.

Nor should the CRTC ignore the ISPs that ben­e­fit from mak­ing broad­cast­ing con­tent avail­able to their sub­scribers and pro­mote this as part of their mar­ket­ing.  It is CCA’s posi­tion that these are the kinds of New Media broad­cast­ers that fall within the spirit of the Broad­cast­ing Act. Broad­cast­ing con­tent is broad­cast­ing con­tent, what­ever the dis­tri­b­u­tion plat­form, a fact Par­lia­ment had the pre­science to rec­og­nize when it adopted in 1991 a new Broad­cast­ing Act which is tech­no­log­i­cally neutral.

What­ever ben­e­fit deliv­ery option may be cho­sen, the CCA sug­gests that man­age­ment costs and pro­ce­dures should be kept to a min­i­mum and that exist­ing admin­is­tra­tive struc­tures be called upon to man­age any new fund which may be cre­ated fur­ther to the cur­rent hearing.

For more details on the CCA posi­tion, you may con­sult the Brief pre­sented in July 2008 and the one filed in Decem­ber 2008 in prepa­ra­tion for the CRTC Hearing.

Why this Matters

New Media are at the core of the cre­ative econ­omy and it is expected that in time, they will sur­pass other means of dis­tri­b­u­tion for what has tra­di­tion­ally been described as broad­cast­ing. Inter­ac­tive media devel­op­ers engage the ser­vices of artists, musi­cians and other cre­ators in their bur­geon­ing indus­try. Recent data show that over 9000 Cana­di­ans are earn­ing their liveli­hood in inter­ac­tive media devel­op­ment, an indus­try that gen­er­ated over $1.5 bil­lion in revenues.

This is why in its var­i­ous inter­ven­tions with gov­ern­ment, most notably in its pre-budget sub­mis­sions, the CCA has invited the gov­ern­ment to main­tain and increase its invest­ments  for train­ing and for the pro­duc­tion of new media Cana­dian con­tent. Music and audio-visual pro­duc­tion is an impor­tant cre­ator of jobs in Canada.

Finally, the CCA never misses an oppor­tu­nity to defend the cul­tural and social objec­tives included in the Broad­cast­ing Act, par­tic­u­larly in sec­tion 3, where we find the most com­plete expres­sion of a Cana­dian cul­tural pol­icy ever adopted by Parliament.