The CRTC and Canadian Cultural Content

CCA Bul­letin 53/06

Ottawa, Decem­ber 20, 2006

•  The satel­lite radio re-distribution decision

•  The new Com­mer­cial Radio Policy

•  The Over the Air Tele­vi­sion Pol­icy hearings

•  New Media: the deci­sion to take no decision.again!

Just the facts.

The pro­duc­tion and exhi­bi­tion of Cana­dian music and drama has been the object of much of the Cana­dian Con­fer­ence of the Arts’ (CCA) pre­oc­cu­pa­tions dur­ing the past nine months. The CCA has inter­vened sev­eral times in CRTC pro­ceed­ings, both in writ­ing and in per­son: in the spring, in the Com­mer­cial Radio Pol­icy Review; through­out the sum­mer, against appli­ca­tions by a num­ber of Broad­cast Dis­tri­b­u­tion Under­tak­ings’ (BDUs) to be allowed to redis­trib­ute Satel­lite Sub­scrip­tion Radio ser­vices (SSR) and; in the early fall, in the con­sul­ta­tion on the impact of new tech­nolo­gies on the Cana­dian Broad­cast­ing sys­tem and, most recently, in the review of the over the air Tele­vi­sion Pol­icy.

As the year 2006 comes to a close it is appro­pri­ate to review these var­i­ous broad­cast­ing files, which touch on some core pri­or­i­ties of the CCA, namely the pro­duc­tion and dis­tri­b­u­tion of Cana­dian cul­tural expres­sion: music in the case of radio, and drama in the case of television.

Satel­lite Radio

On Novem­ber 28, the CRTC announced its deci­sion to autho­rize Rogers Cable Com­mu­ni­ca­tions (and by impli­ca­tion, all other BDUs who have applied for the same) to dis­trib­ute the audio pro­gram­ming of one or more licensed SSRs . In doing so, the CRTC rejected the argu­ments put for­ward by a num­ber of dis­trib­u­tors (includ­ing Sask­Tel, Telus, MTS All­stream and the Bell Video Group), who had argued that they already had the author­ity to do so.

A large num­ber of Cana­dian Cul­tural orga­ni­za­tions (the CCA, SOCAN, ADISQ, CIRPA, UDA, AFofM, etc.) had suc­ces­sively opposed Rogers, Bell, Shaw, Telus and Vidéotron on the grounds that it would lead to the demise of exist­ing truly Cana­dian pay audio ser­vices and, quite con­trary to the BDUs’ argu­ments, mean less choice to Cana­di­ans by reduc­ing the num­ber and vari­ety of Cana­dian artists they have access to.

All of us can claim par­tial vic­tory: while allow­ing the redis­tri­b­u­tion of SSRs sig­nals, the Com­mis­sion has imposed clear con­di­tions of license aimed at pro­tect­ing the more con­sid­er­able amount and vari­ety of Cana­dian con­tent found on Cana­dian pay audio ser­vices. BDUs can redis­trib­ute all or parts of the SSR ser­vices con­di­tional on the sub­scriber receiv­ing at least 40 chan­nels of one or more pay audio under­tak­ings. This re-establishes some­what mean­ing­ful Cana­dian con­tent reg­u­la­tion as opposed to what the Com­mis­sion did in licens­ing the SSRs in 2005.

New Com­mer­cial Radio Policy

On Decem­ber 15, the CRTC pub­lished its much awaited “new” Com­mer­cial Radio Pol­icy. Here again, the deci­sion was received by the cul­tural sec­tor with mixed feelings.

First, the CRTC rejects the argu­ments of the whole cul­tural sec­tor seek­ing to increase to at least 40% the required level of pop­u­lar Cana­dian music aired on com­mer­cial radio sta­tions. On a more mar­ginal issue given the num­ber of radio sta­tions involved, the Com­mis­sion agrees with the CCA’s rec­om­men­da­tion that Cana­dian con­tent clas­si­cal music require­ments be increased to 25% and Cana­dian jazz and blues music to 20% respec­tively: the cur­rent min­i­mum reg­u­la­tory level for these gen­res is at 10%. How­ever, these increases will take place only at the next license renewal for each sta­tion, which in some cases means a delay of a few years.

When it comes to broad­cast­ers’ con­tri­bu­tion to the devel­op­ment of Cana­dian Con­tent (inter­est­ingly enough, the Com­mis­sion no longer talks of devel­op­ing Cana­dian tal­ent), the Com­mis­sion has estab­lished a new approach based on a radio station’s rev­enues rather than on the size of the mar­ket in which it oper­ates. The money gen­er­ated will still have to be fun­neled for the most part through FACTOR and MUSICACTION: this is some­thing that the CCA sup­ported, but which has many detrac­tors that point to most of the money going to Van­cou­ver , Toronto , and Mon­tréal, with the rest of the coun­try being left out. The Com­mis­sion esti­mates that had the new sys­tem been in place in 2005, it could have gen­er­ated as much as $4 mil­lion more for tal­ent (con­tent) devel­op­ment, i.e. a 20% increase on the actuals.

As for ensur­ing diver­sity in musi­cal choice instead of hear­ing the same small num­ber of songs and artists played over and over again every­where, a point much debated at the hear­ing, the CRTC has decided to limit the exer­cise of its pow­ers to even­tu­ally ask­ing broad­cast­ers at license renewals time to make spe­cific com­mit­ments to pro­vide air­play and pro­mote emerg­ing Cana­dian artists.

Unfor­tu­nately, the CRTC does not have a very impres­sive track record of enforc­ing its own con­di­tions of license, let alone call­ing broad­cast­ers to account for their bro­ken promises of per­for­mance. Inter­est­ingly enough, this patch­work approach has been chas­tised by a dis­sent­ing Com­mis­sioner on the panel. It seems that emerg­ing artists had bet­ter con­tinue to rely on Cana­dian pay audio ser­vices and the Inter­net to find an audience.

Con­ven­tional Tele­vi­sion Pol­icy Review

The CCA has taken part in the CRTC over the air Tele­vi­sion Pol­icy Review process which is clos­ing this week. Focus­ing on the most cru­cial cul­tural issue, drama — par­tic­u­larly in Eng­lish Tele­vi­sion — the CCA first tabled on Sep­tem­ber 27 a sub­stan­tial analy­sis of the var­i­ous (and mostly unsuc­cess­ful attempts) of the CRTC over the past thirty years to ensure that, in con­for­mity with the pro­vi­sions of the Broad­cast­ing Act , Cana­di­ans have access to their own sto­ries when they turn on their TV sets. Our unchal­lenged analy­sis showed that over the past 10 years, due to the CRTC change of pol­icy, more than $800 mil­lion were lost to the pro­duc­tion of Cana­dian drama and regional pro­gram­ming. More­over, if strong cor­rect­ing mea­sures like the ones taken by the CRTC in 1977 are not adopted, in 10 years (the approx­i­mate life expectancy of a CRTC pol­icy), Cana­dian broad­cast­ers will spend 75% more on acquir­ing US pro­gram­ming than they will spend on Cana­dian programming.

At the hear­ing on Decem­ber 1, the CCA sup­ported broad­cast­ers’ sug­ges­tions regard­ing a monthly charge to be paid by dis­trib­u­tors in order to shore up the pro­duc­tion of Cana­dian cul­tural con­tent. How­ever, rather than tying the fee to the num­ber of con­ven­tional sta­tions in any given mar­ket (which leads to wild dis­crep­an­cies across the coun­try), we sug­gested a flat fee of $3 per month. In order to make sure that this time the money would actu­ally go to the pro­duc­tion of Cana­dian pro­gram­ming, we sug­gested the $300 mil­lion thus gen­er­ated be directed to the Cana­dian Tele­vi­sion Fund and allo­cated to the best projects: let true com­pe­ti­tion take place where it should! We also rec­om­mended, amongst other sce­nar­ios, a reg­u­la­tion set­ting out a min­i­mum per­cent­age of the pre­vi­ous year’s broad­caster gross rev­enues to be spent on Cana­dian pro­gram­ming and drama alike, at 32% and 5% respectively.

Finally, to ensure that these pro­grams be seen, we joined a large num­ber of other inter­ven­ers from the cul­tural sec­tor in ask­ing that each broad­caster be required to air three hours of Cana­dian drama a week, between 8 and 10 pm, when most Cana­di­ans watch television.

This week, in a more tech­ni­cal phase of the process, we are tabling our rebut­tal of some of the argu­ments (or unsub­stan­ti­ated asser­tions) made by broad­cast­ers dur­ing the hearing.

The CRTC is expected to issue its new TV pol­icy in about six months.

New Media

At the request of the Gov­ern­ment, over the past six months the CRTC has been con­duct­ing an eval­u­a­tion of the impact of new tech­nolo­gies on tra­di­tional broad­cast­ing. This eval­u­a­tion included a pub­lic call for com­ments over the summer.

In its Sep­tem­ber 1 brief, the CCA advanced argu­ments to the effect that while tra­di­tional media was not threat­ened in the short run, it behooves the CRTC to be vision­ary, to rec­og­nize their grow­ing impor­tance, par­tic­u­larly for the younger gen­er­a­tion, and to call upon them to make a finan­cial con­tri­bu­tion to Cana­dian cul­tural con­tent the same way that tra­di­tional broad­cast­ers have been obliged to do over the years.

Unfor­tu­nately, in its report enti­tled “The Future Envi­ron­ment Fac­ing the Cana­dian Broad­cast­ing Sys­tem”, the CRTC declares that “the time is not yet right to cre­ate new rules that would force inter­net and wire­less broad­cast­ers to include Cana­dian con­tent or meet other stan­dards it demands from con­ven­tional broad­cast­ers”. The Com­mis­sion sees no need to inter­vene for another 10 years!

Curi­ously enough, the CRTC is once again not respect­ing its basic man­date — i.e. to ensure that the cul­tural objec­tives of the Broad­cast­ing Act (1991) be real­ized: it jus­ti­fies its inac­tion by say­ing sim­ply that pri­vate radio con­tin­ues to make money and that pri­vate TV sta­tions are in good finan­cial health, thus imply­ing that ensur­ing Cana­di­ans find their own cul­tural prod­ucts on all plat­forms is not one of its man­dated pri­or­i­ties. It will be inter­est­ing to see if the health of TV sta­tions is a con­cern when the new over the air Tele­vi­sion Pol­icy comes out in six months time.

Tell me more

Com­mer­cial Radio Pol­icy 2006: Two of the five Com­mis­sion­ers on the panel filed strongly worded dis­sent­ing opin­ions. Worth­while read­ing for those who some­times won­der about some deci­sions of the Regulator.