The CCA Defends Canadian Content Regulations and Supports Canadian music Talent Development in its Brief to the CRTC

CCA Bul­letin 15/06

March 31, 2006

A few months ago, the CRTC announced that it would pro­ceed to Review the 1998 Com­mer­cial Radio Pol­icy (see CRTC PN 2006–1). Com­mer­cial radio broad­cast­ers have been, and remain, an impor­tant part of the dis­tri­b­u­tion sys­tem for infor­ma­tion, music and enter­tain­ment mate­ri­als. Over the course of the hear­ings on May 15, 2006, the CRTC will review impor­tant cul­tural issues – explain­ing why the Cana­dian Con­fer­ence of the Arts (CCA) deter­mined it was cru­cial to inter­vene in this review process.

The CCA announced its inten­tion to inter­vene in this impor­tant CRTC Review in its “From the Desk of Alain Pineau” bul­letin issued Feb­ru­ary 16 2006 and, on March 15 2006 the CCA pre­sented a brief to the Cana­dian Radio-Television and Telecom­mu­ni­ca­tions Com­mis­sion (CRTC). The posi­tions taken by the CCA have been devel­oped after con­sult­ing with all major stake­hold­ers, both CCA mem­bers and non-members.

Con­text of the CRTC Review

The objec­tives for Canada’s broad­cast­ing sys­tem are set in the Broad­cast­ing Act (1991) . Fore­most among these are that the sys­tem should be Canadian-owned and con­trolled, that radio pro­gram­ming should be pre­dom­i­nantly Cana­dian, and that lis­ten­ers should be pro­vided with var­ied and com­pre­hen­sive pro­gram­ming from a vari­ety of sources. The Act also states that pro­gram­ming should be of a high stan­dard, bal­anced on mat­ters of pub­lic con­cern, rel­e­vant to local com­mu­ni­ties and reflect Canada’s rich cul­tural diver­sity. Finally, broad­cast­ing ser­vices must be pro­vided in Eng­lish and French.

Over the past eight years, there have been sig­nif­i­cant changes to the envi­ron­ment in which Cana­dian com­mer­cial radio oper­ates and sig­nif­i­cant changes as well for the music indus­try with which it has a sym­bi­otic rela­tion­ship. While Cana­di­ans are lis­ten­ing to one hour less radio today than they did in 1999, the over­all aver­age Cana­dian still lis­tened to 19.5 hours per week in 2004, divided between the home, work and the car. How­ever, the aver­age fig­ure tells only part of the story, as there are sig­nif­i­cant age dif­fer­ences: 12–17 year-olds lis­tened to only 8.5 hours of radio per week, down from 11.3 hours per week in 1999; and 18–24 year-olds lis­tened to 15.7 hours per week. Since there is no evi­dence that today’s young peo­ple lis­ten less to music than did pre­vi­ous gen­er­a­tions, one must con­clude that they are access­ing it in new ways.

Audi­ences do indeed have new ways of receiv­ing news and infor­ma­tion and new ways of lis­ten­ing to music. Accord­ing to Sta­tis­tics Canada, in 2004, six out of ten Cana­dian house­holds were con­nected to the Inter­net and many Cana­di­ans rou­tinely used the Inter­net at work. Com­puter net­works, includ­ing the Inter­net, are becom­ing even more per­va­sive as com­pe­ti­tion to sup­ply a range of improved telecom­mu­ni­ca­tions ser­vices heats up. The recent announce­ment by Toronto Hydro that it will pro­vide wire­less Inter­net access through­out the down­town core of that city later this year high­lights this devel­op­ment. Dig­i­tal down­load­ing has become a sig­nif­i­cant way to access music, and stream­ing of broad­cast­ing sig­nals and pod-casting are an increas­ingly com­mon way of mak­ing pro­grams avail­able to Cana­di­ans and other listeners.

But despite the chang­ing tech­no­log­i­cal envi­ron­ment, com­mer­cial radio remains an impor­tant means of dis­tri­b­u­tion and con­tin­ues to play a crit­i­cal role in the devel­op­ment of Cana­dian music and artists. Air­play is still an impor­tant way to expose audi­ences to music and artists.

New tech­nolo­gies have been both a chal­lenge and an oppor­tu­nity for com­mer­cial radio. Many radio broad­cast­ers already have well-developed Inter­net dis­tri­b­u­tion mod­els, which can attract addi­tional adver­tis­ing and other revenues.

Finally, thanks in part to the pol­icy adopted by the CRTC in 1998, com­mer­cial radio broad­cast­ers are again finan­cially healthy and this is likely to con­tinue for the fore­see­able future, since they remain an attrac­tive medium for advertisers.

CCA’s positions

For more than 30 years the CRTC’s Cana­dian con­tent rules, which require broad­cast­ers to pro­vide spe­cific lev­els of Cana­dian music in their sched­ules, have under­pinned the emer­gence and devel­op­ment of Cana­dian music pro­duc­ers and artists. The finan­cial sup­port which broad­cast­ers are requested to give to Cana­dian music tal­ent devel­op­ment (CTD) have also played a major role in cre­at­ing the cur­rent vibrant Cana­dian music indus­try and have led to the emer­gence of sev­eral inter­na­tional stars.

• The CCA not only firmly believes that such reg­u­la­tory tools remain as rel­e­vant today as they were when first intro­duced but that they should be extended to all dis­tri­b­u­tion sys­tems irre­spec­tive of the tech­nol­ogy used. With respect to mate­r­ial that falls within the def­i­n­i­tion of broad­cast­ing, ISPs are pro­vid­ing ser­vices equiv­a­lent to broad­cast dis­tri­b­u­tion under­tak­ings. The CRTC should con­sider requir­ing them to pro­vide pri­or­ity for Cana­dian web­sites and ser­vices, and to make a finan­cial con­tri­bu­tion to the pro­duc­tion of Cana­dian music and audio­vi­sual pro­grams deliv­ered over the Internet.
• Given the return of com­mer­cial radio to prof­itabil­ity, the CCA believes that licensees should be increas­ing their com­mit­ments to all gen­res of Cana­dian music and artists, with a par­tic­u­lar focus on new and emerg­ing artists.
• The CCA is rec­om­mend­ing that Cana­dian con­tent lev­els be increased: for pop­u­lar music to at least 40%; for clas­si­cal music to at least 25%; and for jazz music imme­di­ately to at least 20%. The CCA would not oppose a phase-in period for the higher con­tent lev­els in pop­u­lar and clas­si­cal music. The CCA also believes that con­tent should be cal­cu­lated on the basis of three-hour time slots, from 6:00 am to 6:00 pm to cor­rect the pre­dis­po­si­tion of some licensees to pro­gram Cana­dian mate­r­ial at times when audi­ences are lower.
• The CCA sup­ports the exist­ing require­ments for French-language broad­cast­ers to pro­gram French-language vocal music (65%).
• The CCA believes that new reg­u­la­tions and incen­tives are needed to pro­mote air­play for new and emerg­ing artists and for Cana­dian artists in spe­cial­ized cat­e­gories. A sys­tem of bonus cred­its may be appro­pri­ate in the con­text of ris­ing Cana­dian con­tent requirements.
• Finally, the CCA rec­om­mends that com­mer­cial radio broad­cast­ers make an annual con­tri­bu­tion to Cana­dian Tal­ent Devel­op­ment of no less than $10 mil­lion. The appro­pri­ate min­i­mum pub­lic ben­e­fit in the case of trans­fers of own­er­ship should be increased to 10%. The bulk of the new CTD should flow to exist­ing arms-length agen­cies involved in tal­ent devel­op­ment, pri­mar­ily Factor/MusicAction.

The CCA has requested to appear at the hear­ings which are sched­uled to begin on May 15th 2006 in Gatineau. The com­plete CCA brief to the CRTC (avail­able in Eng­lish only), can be found on our web­site at www.ccarts.ca.