Proceedings of the Standing Senate Committee on
Transport and Communications
Issue 13 - Evidence, January 27, 2015
OTTAWA, Tuesday, January 27, 2015
The Standing Senate Committee on Transport and Communications met this day at 9 a.m. to examine the challenges faced by the Canadian Broadcasting Corporation in relation to the changing environment of broadcasting and communications.
Senator Dennis Dawson (Chair) in the chair.
[English]
The Chair: Honourable Senators I call this meeting of the Standing Committee on Transport and Communications to order. Today we are continuing our study of the challenges faced by the Canadian Broadcasting Corporation in relation to the changing environment of broadcasting and communications.
Our witnesses are from Entertainment One, also known as eOne, a global leader in cultural content with more than 35,000 film and television titles, 2,800 hours of television programming and 45,000 music tracks.
We have before us today Vanessa Steinmetz, Vice-President, Production Financing; and Mark Slone, Executive Vice-President, Theatrical Distribution. We will begin with Ms. Steinmetz and then Mr. Slone.
Vanessa Steinmetz, Vice-President, Production Financing, Entertainment One: Good morning, members of the committee. My name is Vanessa Steinmetz, and I am here with my colleague Mark Slone representing Entertainment One. Thank you for inviting us to be present here today.
Today I will speak to the matters related to television, and Mark will address matters related to film.
Kindly note that eOne is a member of the Canadian Media Producers Association and the Canadian Association of Film Distributors and Exporters. Our remarks here today follow their spirit and the substance of their respective submissions as well.
Headquartered in Toronto, Entertainment One is a global entertainment leader in independent content ownership and distribution of film, television and music. eOne has 1,700 employees worldwide with offices in eight countries, including over 800 employees across Canada. In the most recent year, eOne invested more than $500 million in film and television content.
Last year, our television production division delivered more than 200 episodes of original programming, which amounted to a production spend in Canada of over $215 million. We expect to deliver nearly twice that amount this year.
In our most recent fiscal year, 74 per cent of eOne's overall annual production spend was spent on Canadian content, and nearly 70 per cent of the revenue from our global television business, close to $300 million, was spent on Canadian content production.
For context, we go to the open market and get investors' capital to make investments in Canadian content. Through partnership with the Government of Canada, its agencies and Crown corporations, and our partners in provincial and municipal governments, we have built a global content company headquartered here at home.
We understand that the committee is interested in hearing about the general state of broadcasting in Canada and the environment in which CBC operates.
Having a focused national broadcaster is necessary for the Canadian film and television ecosystem to create jobs, develop talent and create award-winning globally commercial content. The CBC is a partner in our success. Like all partnerships, there are areas where we can improve.
eOne firmly believes that a strong production and broadcast environment is essential for the continued success of the Canadian television and film industry in its objective to create and produce compelling and diverse Canadian television, film and non-linear digital programming that resonates with Canadians.
Canadians today have unprecedented access to a vast array of programming services and on-demand content from all over the world, all competing for the viewer's time, attention and dollars. An infrastructure that supports a steady supply of compelling Canadian programming just isn't enough. It takes a willingness to innovative, especially when it comes to high-end dramas that need to generate significant international revenues in order to support ever-increasing production budgets.
We believe making Canadian film and television is a viable business, and we want to risk our capital to make those stories become commercial successes. We need partners who are equally willing to share in that risk taking.
Evolving our production broadcast system into one that encourages the development of homegrown hits that Canadians and the rest of the world demand to watch and that can thus return real and significant profits back into the Canadian broadcast, distribution and production industries is one way of ensuring a healthy production and broadcasting ecosystem in Canada.
Canadian consumers are sophisticated and will watch Canadian content, not because it's available to them but because they want to — because it's world-class programming with a Canadian sensibility or voice that speaks to them.
In this time where the appetite for content is voracious, we see a curiosity and hunger from audiences to be immersed in drama with a sense of "place.'' CBC is the most likely commissioner of this type of unabashed Canadian content. Other countries have been successful at selling formats and exporting their unique content. Standout examples of this include the U.K. with shows like "The Fall'' and "Broadchurch'' or New Zealand with "Top of the Lake'' and Scandinavia with "The Bridge'' and "The Killing.'' Canada's unique story, setting, politics, culture and place on the world stage should be equally engaging to a global audience.
CBC alumni are in leadership positions throughout the Canadian and U.S. production, broadcast, funding and policy areas of the industry. CBC can truly be the home where Canadian talent is nurtured, developed and showcased. We encourage the CBC to focus its mandate of sharing Canadian stories by fostering partnerships with Canadian independent producers and distributors. CBC should rely on the independent production community to bring forward quality projects and execute them, and partner with distributors who are willing to take risk and launch Canadian stories on the international stage.
I would like to take this opportunity to emphasize that in order to survive and flourish as an industry, the system must safeguard Canadian ownership in order to ensure that the worldwide profits derived therefrom stay in Canadian hands.
The development of homegrown talent is integral to the continued growth and success of Canadian stories being told in an ever-expanding marketplace.
Mark Slone, Executive Vice-President, Theatrical Distribution, Entertainment One: More than a century after their invention, motion pictures have continuously been the most popular and affordable form of out-of-home entertainment in Canada. In Canada we have a rich history of telling our stories via the cinema, both as a collective experience at home and as a cultural ambassador around the world. From the red carpet in Cannes to the Oscar stage in Hollywood and, most importantly, in movie theatres from coast to coast to coast, the Canadian experience is reflected in the movies we make, from Dr. Cabbie, the story of an immigrant doctor who sets up a clinic in a taxi when his credentials are not recognized, to The Grand Seduction's whimsical comedy about a Newfoundland town whose residents will stop at nothing to protect their way of life. Canadian movies that are set in Canada are increasingly finding audiences at home and abroad. In English Canada we take our lead from Quebec where artistic excellence and commercial success go hand in hand.
In 2014, eOne released 275 feature films to theatres around the world, many of those Canadian. We also launched Seville International, a Montreal-based boutique international sales company to source and secure English- and French-language Canadian film for worldwide distribution.
But, while love of movies continues unabated, the audience's consumption patterns are changing. Theatrical movie going has plateaued, and mobile and at-home viewing are increasing. Movie making is a tough game that takes years of effort and significant resources. Traditionally in Canada, funding to get a movie made came from three sources: the distributors, who purchase the rights to sell the films to audiences at home and to other distributors abroad; agencies of government, who fund the tax credits and Telefilm Canada; and the broadcasters, who pre-license the TV rights. This is a three-legged stool — distribution, government and television — that ensures that movies that get made have a post-theatrical home on the place where most Canadians get the majority of their filmed entertainment. That's on television.
The theory always was that the taxpayer contributed significantly to the creation of the movie, so they should be able to see those movies at least as easily as they can see foreign and American films. Today, our homegrown movies are better than ever. eOne saw seven of our Canadian films surpass the $1 million mark at the box office in 2014. But, even as the quality goes up, there is no consistent home for the films on television. The movies are great, but broadcasters are simply not buying enough of them.
Why? We think that broadcasters have become enamored with series and low-cost reality TV. Series have a built-in advantage; they keep audiences coming back for next week's episode. Fair enough, but broadcasters enjoy a huge advantage — privileged access to the public airwaves. You or I cannot start a TV station tomorrow without applying to the CRTC, which will take into account the effect that our idea will have on existing players. They are protected. In exchange for their protected status, they carry a big responsibility: showcase Canadian culture and invest in the industry that carries the dual function of telling our stories and creating economic opportunity for the tens of thousands of Canadians who work in filmed entertainment.
And the CBC? To use eOne's sales history as an example, we now sell fewer than 10 Canadian films to the CBC annually, and those are a mix of older and lower-budget titles. Quebec titles are almost never shown. Those that are bought are never promoted on air. The days when important Canadian films like Bon Cop, Bad Cop or The Rocket could be seen on CBC are over.
What is the prescription? In the first place, we must continue to make movies that are aligned with market interests at home and abroad. We must own international sales companies that carry our stories around the planet. We must embrace new technologies. We must respect the digital consumer, who wants to watch what they want, where they want, on a multitude of screens. Today, we must ensure that Canadian films are available to Canadians on television. They must play on a consistent basis. They must have a variety of intended audiences — family, teens, adults, young and old, urban and rural. I believe that we must take every opportunity to showcase the movies for which we have all paid.
The CRTC can play an important role by making a small change to the Canadian content regulations: add a new category of programming for movies, distinct from dramatic television series. Regardless of the changes to their licence, the CBC must embrace the opportunity, at this time of upheaval, to program our stories. Movies are a wonderfully cost-effective way for cash-strapped programmers to get content, and buying Canadian features would certainly be cheaper than buying a Hollywood blockbuster.
National broadcasters around the world are the number one place for domestic audiences to see their stories told. If German, French, Italian, Mexican, Brazilian and Israeli audiences can all see their movies on TV, why can't we? In fact, CBC should aspire to be the home of Canadian films. In the last week of 2014, CBC spent valuable programming dollars showing Toy Story 3. Is this really the mandate of a national broadcaster? Following the loss of hockey, this is an opportunity to refocus on our communities. Let's showcase the best French- and English-language films from our talented creators across Canada. Would it really be too much to imagine one prime time slot a week being devoted to airing a new Canadian movie? We think not. Canadian writers and directors, who are finding major success on both sides of the border, want to work at home, and they want to make films that not only have Canadian sensibilities but also feature real Canadian cities and stories. They are doing it: Cronenberg, Egoyan, Vallée, Villeneuve, Dowse, Falardeau, just to name a few. Let's ensure that Canadians can see those movies.
Senators, we are thankful that you have given us the time to appear today. As a company that fights every day to get private sector investment to produce and distribute Canadian film and television, let me say how excited we are about the success our industry has seen in recent years. We hope very much that we might see more of these Canadian stories on our screens every day.
Tonight, we will be screening "The Book of Negroes'' on Parliament Hill, and we hope very much that some of you will take the opportunity to attend and see some of the great work that Canadian filmmakers are doing.
Thank you, and we're available to answer any questions.
Senator Eggleton: First of all, congratulations for the great success your company has achieved and the good work it's doing, not just in Canada but also around the world. I'm delighted that you are headquartered in my home city of Toronto.
You're an important part of Canadian content and the distribution of it, in both the film and television industries in Canada.
I just have a few little questions here.
First of all, you talked about the CRTC perhaps making a small change to Canadian content regulations, adding a new category of programming for movies, distinct from dramatic television series. Where do you draw the line? What is a dramatic television series versus a movie? For example, you mentioned "The Book of Negroes,'' which is being featured here today. Is that a movie, or is that a television series?
Mr. Slone: I think that's a television series. I would draw the distinction between that and those films that are meant for movie theatres in Canada and abroad. One of the realities, when one talks about cultural ambassadorship, particularly outside of Canada, is that movies sit on a different stage or a different level. There is a lot more attention when a film goes to the Cannes Film Festival, for instance, than when it gets shown on a broadcaster in another country. So we feel that, by creating a separate category where we recognize feature film as standing distinct from a program that's meant just for television, it will do a better job of carrying our message globally.
Senator Eggleton: You also said in your remarks that you now sell fewer than 10 Canadian films to the CBC annually. Why is that? Are you selling more to the private broadcasters or even fewer than 10? Why is it that you not able to sell more to the CBC, which is our public broadcaster?
Mr. Slone: I don't want to answer for them because I completely agree with you that, as they are our public broadcaster, that's exactly what should be happening. In the landscape in general, the over-the-air broadcasters are shying away from feature film generally, but particularly Canadian film. I think what happens is that it does become a ratings game. They're chasing advertisers. Series bring people back on a regular basis; therefore, you have the potential for larger audiences on a consistent basis. Every time a feature film starts, it's a whole new story. When it finishes, you have to come back and get next week's story as well. If it's purely a ratings game — in other words, just pure numbers — then series can make more sense. If we have a larger goal for the CBC beyond just the bulk number thing, then we think that feature films have an important role to play.
Senator Eggleton: What about the competition with the American entertainment industry? You said that in Germany, France, Italy, et cetera, they all have their film industries, but they also have different languages. We're also up against the American entertainment industry in terms of competition. How would you adjust for that factor?
Mr. Slone: In a lot of ways, we have a much bigger challenge because, one of the plusses, say, for a German audience is that there aren't other countries beaming German-language content in constantly. The important thing to understand is that, in Canada, 85 per cent of the theatrical marketplace in movie theatres is dominated by American and foreign films. We're battling for a 15 per cent share for Canadian film, and we have none of the benefits that those American films have in Canada — namely, a gigantic country to the south pumping media support across the border. When we launch a Canadian film in Canada, it's just us. It's just this little group of Canadians trying to do it. When Disney launches a big movie, they are North America wide. Because the Internet is borderless, the information they put on the U.S. stuff comes across into Canada. They have a huge promotional advantage. We believe that there needs to be some kind of a leg up, just as there is in all of those countries that also face a huge number of their films coming from the U.S. There needs to be a little leg up to try to level that playing field. It's hardly a level playing field at the moment.
Senator Eggleton: You also said that theatrical movie going has plateaued, and mobile and at-home viewing are increasing. It seems to me that I've heard this before. A number of years ago, people thought that fewer people were going to theatres. I've been to a few of them lately, and they're pretty packed for some of the good movies. Now is the time to see the good movies. What makes you think that that will happen this time?
Mr. Slone: We really have seen a levelling out. I do want to stress that it's plateauing. I think that there continues to be a level of out-of-home experience that everybody still needs. You have to go out of the house, bottom line, and movies are an affordable way to do so. However, there is a generation now that has become very comfortable with the idea of having some things that are appropriate to see in a movie theatre and other things that they only want to see on their phone, tablet, laptop or television at home. Unlike the era of VHS, where everybody said, "This will kill movie going because everybody will just stay at home and watch movies,'' we recognize the fact that out-of-home is a really important experience. But, having said that, the impetus to build more movie theatres is very low right now. It's very expensive to do so, and there's a virtual monopoly in theatre ownership right now in Canada. So, without increasing the number of theatres and opportunities, you have a very busy experience when you go, but that probably means that more movie theatres should be built. They're not happening.
Senator Eggleton: In the last number of decades, CBC has experienced cutbacks in its funding. Political parties of different stripes have both done it, but I'm concerned we've gotten to a point where the cuts have gone too far.
Do you have any comments about the cuts to the CBC and how your dealings with the CBC have been affected by their present funding level?
Ms. Steinmetz: It's very difficult for the CBC. When they get a show up and running, they have to do the promotion and marketing on their own. The privates have the ability to feed off marketing for shows. They buy U.S. programming, and they kind of get the marketing dollars and promotion for free. So as the cuts hit the CBC, we definitely see it is harder for them to get the shows up and going.
It is harder to launch a program like "The Book of Negroes.'' It's an expensive production as a six one-hour miniseries. It's event television, and, it's shot all over the world. It's shot in South Africa and Nova Scotia. In order to do that, you need the dollars, and then you need the dollars to promote it. I guess the answer is yes, they have to get more and more creative about how they make their programming, and they need partners like us to help invest.
Senator Eggleton: Put me down for second round.
Senator Demers: Good morning and thank you for your presentation. There is something with the timing this morning. I was in the United States recently, and we could do it back home in Canada. You have a movie that has been out in the theatres for maybe 10 days, or let's say a month, and all of a sudden you can get it at home in your living room. You could have four or six people pay $15.99 or $17.99. Where you do you stand with that? There is a huge change. I have never seen more people staying home. Is the industry in danger with that situation?
Mr. Slone: To expand a bit on the point I made earlier, I think it is a case where there is a multitude of new choices. First of all, people are consuming more filmed entertainment than they ever have before, so the number of hours being consumed has gone up exponentially in the last decade, notably due to the proliferation of screens everywhere. Everyone carries a screen in their pocket now.
I want to emphasize the idea that as human beings, we need to experience the world outside of our homes. If you take a girl out you can't say come over and watch a movie on TV. My mom and dad need somewhere to go on the weekends, and going to films is affordable. The price has gone up, but if you compare it to other things one can do out of the house, and you enjoy the experience of relationships outside of the home, it's actually an affordable choice, particularly if you avoid buying too much popcorn. The experience leads to a larger collective experience. People go to work and talk about the movie they've seen. They go online and do commentaries. That builds cinema-going. With all the advertising I do in the world, nothing changes good old word of mouth. When someone you respect tells you that a movie is worth seeing, it's going to increase your chances of seeing it.
If we make great quality and keep the prices at a level at least within the reach of the average Canadian, we will still continue to have a robust movie-going audience.
Senator Demers: In recent years, private broadcasting and the telecommunication industry have converged. The CBC/Radio-Canada, in contrast, is a pure broadcaster. What happens here for people like you? You mentioned only 10. In your opinion, does that convergence affect CBC/Radio-Canada? Where do you go with that? They have not joined the other people.
Mr. Slone: It is true. One of the realties is that all rights for every window we talk about, whether it is DVD, television or movie theatres, have an exploitative value. In other words, you want to earn as much money as you can in each window before you move on to the next one. Consequently, when we sell rights to a broadcaster, and if they want to capture those ancillary rights you're talking about, perhaps to reshow it on the Internet after it has been shown on television, there has to be a monetary value.
If the CBC is at a point where cash constraints are saying they can't be everything to everyone, in my opinion it would be an opportunity to retain broadcast rights and ensure that films and television are shown in large and small centres, but allow those additional rights to be sold to other players for exploitation. If we can agree that duplication is not the goal but rather to enhance the offerings already out there, it might be better to allow the CBC to focus on what they can offer, which is broadcasting that reaches absolutely everywhere in our country.
Senator Demers: I have one last question. Your answers are great. What's your experience in other countries regarding the convergent effect, public broadcasters in other countries? What's your vision of that?
Mr. Slone: A good example is the U.K. where they've chosen to embrace online in a huge way, and the iPlayer, which is what their online service is called, is wildly popular. However, there is a stability of funding that allows them to invest in that type of infrastructure. One needs to make a decision. Either the funding will be there and you can go for it, or you will have less funding and not. But a huge mistake would be to try to accomplish everything on limited resources.
Senator Plett: Thanks to both of you for being here. We're visiting the U.K. two weeks from now, so we'll check that out further. My first question is purely personal before I ask some others. There is a series coming out apparently, I just read in the paper, which has been produced in Grosse Isle, Manitoba, called "The Pinkertons.'' Did eOne have anything to do with that?
Ms. Steinmetz: No, we didn't.
Senator Plett: Sorry to hear that; I'm looking forward to it.
Ms. Steinmetz: We did co-produce "The Don Cherry Story,'' which was shot in Manitoba.
Senator Plett: I'm looking forward to watching it as a series. And speaking of series, you talked about "The Book of Negroes.'' I've read the book. I just finished the book as a matter of fact. I read it earlier under a title. It's called Someone Knows My Name, and when I started reading The Book of Negroes, I told my wife I've read this before. After I finished, I found out they were one and the same, and I'm looking forward to watching.
I always hated watching series because I would watch it this week, and next week I wouldn't have time. Now of course with the PVR we're beyond that. I'm not going to go out tonight because my wife would be upset because we taped the four weeks and we committed to watching it together next weekend, so I'm looking forward to watching all four episodes.
How does that play into the things that CBC does, and what do you do? There are people like me who will do what we just did; we taped the four sessions. Next weekend we will watch it. Come commercial time I will fast forward, make popcorn or do whatever. We can stop it when we want. How does that play into what has happened both in your business, the CBC's and indeed all other broadcasters' business?
Mr. Slone: I'm not a broadcaster, but I imagine from the broadcaster's point of view that PVRing is a challenge. A lot of studies show that consumers tend to watch more than they fast-forward, and that they absorb a lot of information during the fast-forward time.
To my earlier point, what's wonderful in a lot of ways is the fact that you might not have seen that programming otherwise because you might have missed a couple of nights here. If you can't see number two, what's the point of seeing number three? You will see it all.
Taking aside the economic argument, if we talk about how we will participate in culture dissemination, I think what you're doing is what we should be encouraging, which is finding some way to see it. We want to make sure it's there for you. Again, we're not just here to sell advertising dollars; the whole point of doing this is to be able to take a wonderful piece of Canadian literature and turn it into wonderful programming. The more people see it, however they see it, it is a win.
Senator Plett: Tell me a bit more about eOne, the company, if you would. Do you work primarily with CBC or other broadcasters in producing either television movies or television series, or do you also work hard at getting movies into the theatres?
Senator Eggleton just talked about the cost of going to the theatre. My wife and I went on Sunday, I think it was, and we watched American Sniper. Obviously, the title, American Sniper, would give it away that it's not a Canadian snow. Nevertheless, I'm one of those people who really just want to see a good show. I know I should not say this when we're being televised, but I don't pay that much attention to whether it's Canadian, American or British. I want to see a good show. American Sniper had a record crowd of 105 million the first weekend. We went to see it — it's a great show. It wasn't costly to see the show; but then I went to the popcorn station where it cost me as much money to buy popcorn and a pop as it cost to watch the show.
Clearly, I don't think somebody is going to the theatre to watch a Canadian production. They're going to watch something that entertains.
Mr. Slone: I totally agree with you. I often say that nobody goes to the movie theatre and pays $12 for patriotic reasons. We go to be entertained. Our goal should always be to create the kind of entertainment that makes you want to see it. I want you to see The Grand Seduction because when you see the trailers and talk to your friends, it seems like you're going to spend $12 very well and be entertained with laughter and all the other emotions that the film is supposed to produce. That is the only reason you go. If we're making content so people can feel patriotic, then we've definitely made a mistake. The quality is so much higher now than it was years ago. In a lot of ways, we're just battling a perception that's wildly out of date.
"The Book of Negroes'' and all the other shows that we make for export around the world are not being bought because they're Canadian; they're being bought because they're good. We are now at a point where we can say proudly that we actually have outstanding content that you'll want to pay to see for the only reason that it's entertaining.
Ms. Steinmetz: Competition makes you up your game. We as Canadians have invested a lot over the last 20 years from when the tax credits came to fruition. We've built a very strong industry, and you don't want to waste that investment. We've become experts in the field of film and television production. You don't want that to go to waste. At Entertainment One, as a real studio, we're trying to provide all of the support to the creators. We try to partner with creators very early on. We become involved in their projects from the very early stages and give them the business, legal and financial support to try to build these projects up so that they can stand in the international marketplace, which is where we're all competing. For Canada to not have a voice or a place in that would be a loss.
Senator Plett: I agree. I found out yesterday, and I'm sharing too many personal stories, that my wife is a little more patriotic than I am. As she was driving me to the airport, we were listening to SiriusXM radio, and I wasn't paying very much attention. She made the observation that she was upset with SiriusXM because they did not play enough Canadian artists. I commend her for that, even though I should have come up with it.
We've got a great Library of Parliament that prepares questions for us. In reading some of their material, I found an interesting question that I would like to ask. Their preamble states that as part of the CRTC's Let's Talk TV consultations, Entertainment One proposed the establishment of a more flexible Canadian content point system that can be made available to Canadian producers and broadcasters on a certain number of qualified high-budget television programs each year provided that the worldwide distribution rights are retained by a bona fide global content exporter who has demonstrated a track record of investing a significant and material amount into Canadian content programming.
There are two questions on that: First, how would the proposed Canadian content point system differ from the current system? Perhaps you could explain that point system a little bit. Second, how, if at all, would CBC/Radio-Canada participate in the distribution of the qualified high-budget television programs?
Ms. Steinmetz: It's not something that has been fully fleshed out, but the idea that John Morayniss was proposing at Let's Talk TV was that perhaps alongside the system we have now, the 10 out of 10 or 6 out of 10 Canadian content points, there could be a way alongside that, where there is a bona fide distributor who has shown investment in the system, to try some kind of pilot program to bring in more collaboration, not necessarily just Canadian, of the best people for a project to work alongside Canadians to try to elevate the level of a production to an international level.
That's kind of where the idea is coming from. Also, we need to look at the distribution side of things and the policy around distribution, which is not really in place right now, because we want to keep the dollars here at home. Many foreign studios are taking international rights to Canadian programming, and that's an issue.
Mr. Slone: I talked a little bit about international distribution and how important it is to get out of the idea that we only make programing that exists within the 4 per cent of the global audience that is Canada or maybe 9 per cent of the North American audience that is Canada. The idea that we are referring to very much comes out of the theory that we have to control the international distribution channels as well. Occasionally we will have to make stuff that's only for Canada because it's so specific, and we accept that. But, in general, if we're going to have exportable product, the old system where Canadians would make it using tax dollars and local investment and then hope later on that somebody would buy the rights and distribute it globally is old fashioned — it's outdated.
We absolutely need a model where we think globally at all times, because the dissemination model has become global. If Netflix can buy the worldwide rights to "Trailer Park Boys,'' as they did last year, which was an easier one to sell, then we need to be able to ensure that all of our projects have that pipeline to get out to the planet, not just within our borders. We are spending all this money, and we're making great content, so we have to ensure that it has real distribution and not just catch as catch can.
Senator Greene: I'd like to ask you a hypothetical question. What would be the impact on Canadian content and Canadian programming, stories about us, basically, if we were to take all of the funding that we provide to the CBC right now, $0.5 billion, and put it into the Canada Media Fund?
Mr. Slone: I'll say this: We're doing two kinds of programming in this country, in general, in both film and television. There is what I call specifically Canadian content, and the stuff that's a little more available or generic for the world. The private broadcaster in particular has done a great job in supporting the stuff that's a little more international. They look for simulcast with the U.S., and it all makes good economic sense. But I think the secondary mandate of saying that we have actual stories that are very important to tell is that sometimes they are risky to tell; or they feel risky at the outset. We were talking about The Rocket before, which was an easy one to make, but other stories are more challenging. A few years ago, we had an Aboriginal film, Atanarjuat, which was set in the Far North using First Nations languages. It actually became a big hit in Canada with English and French subtitles and the CBC aired it. It took a lot of nerve to make that movie not in English and set in the Far North. It's historical and is a beautiful movie. It travelled around the world. Would a private broadcaster or entity take on such a story with all the inherent risk that it might not work? I suspect not, but we're a better place for that movie having been made. One danger when you take out the curation that comes with the CBC's ability to create distinctly Canadian stories is that we might be at risk culturally.
Ms. Steinmetz: It costs a lot of money to make these programs. It's a lot easier to buy programs that are already made; so you either commit or you don't.
Senator Greene: The money would be in the Canada Media Fund, which you would have access to and would be enhanced considerably.
Mr. Slone: But it's only production, of course. You do the dissemination piece, and particularly in a nation that's so geographically spread out, I think there is even greater need to ensure that people are seeing the same content in different areas of the country to help bring us together as a country. It's much easier if you're in a tighter physical space, but imagine how hard it would be to share the collective experience if we could not share those. If people are watching "The Book of Negroes'' in Halifax, Vancouver and the far North all at the same time, it is a very important part of what would make that a collective experience. Just saying, "Let's make programming,'' but having no way to ensure that it goes absolutely everywhere would only be half the puzzle.
The Chair: First, I would like to excuse myself for tonight because I have prior engagements, so I won't be going. But I'll be doing like Senator Plett; I'll be binge listening to "The Book of Negroes.'' I've been taping it, and the first day that I have a good snowstorm that keeps me at home, I'll play the show episodes back to back, which is a new phenomenon. When you produce something like "The Book of Negroes,'' do you know that the audience is there? Do you calculate that when you produce a show?
Ms. Steinmetz: Yes. Like baking a cake, which is another example from Let's Talk TV, you try to get the best ingredients that you can. If you have an underlying property like Lawrence Hill's book, that is a golden property, and you try and build upon that and make it the best you can. Can you ever estimate what the audience will be? No, at the end of the day that's anybody's guess. Again, getting in early, what I was describing before about the studio-based structure we're trying to build, is that you want to stack the project up as best you can, so that it has the best chance to reach the widest audience, and that's through casting, underlying material, great writers, actors, all of that, all those components. We're thrilled to get the ratings that we did on "The Book of Negroes'' on the first night, which is almost 1.8 million.
The Chair: On another level, "19-2'' is a police show that was done on Radio-Canada in French. It was very successful for the Quebec audience, something like 1.9, just for the province of Quebec. But the same show is not shown on CBC. It's done by Radio-Canada, but it's being televised, I think, on CTV. For an organization like CBC, where do they miss out on that? It's very successful in English Canada. Where do they miss out on saying let's do it as a CBC/Radio-Canada project versus a Radio-Canada project that is bought off and adapted in English by CTV? I know CBC will be a better audience. Would you have a product that you can sell to Radio-Canada and also to CBC, and that only half of it would buy it?
Mr. Slone: It certainly happens constantly. It's a reticence, I think, to show subtitled or dubbed programming on the alternative service. I can't speak for why they don't make those decisions to do those kinds of things internally.
I do believe that if there is a market force that is going to buy the project, that should probably be the first stop for any kind of programming. In other words, if CTV, a commercial private broadcaster, wants to buy and air Canadian content and sell ads, then they should probably be the first ones to do it. The CBC has this added responsibility of filling in the gaps, if you will, in the private system — those things that may not otherwise find time on the air — for instance, Quebec films. I find it outrageous that a film like Mommy, which was such a global phenomenon and was received so well in theatres in English Canada, won't be seen on a national English broadcast basis. It seems outrageous to me. We helped pay into it. It's a wonderful movie, and the guy is an incredible talent, and yet it's not going to have a prime time slot. It should be in a prime time slot where it's available to all. We do indeed miss opportunities when we let old ways of thinking about language and audience permeate the way we disseminate our programs.
The Chair: On second round, I have Senator Eggleton, then Senator Plett.
Senator Eggleton: In talking about TV series or films which tell Canadian stories and the importance of telling them to Canadians, you've also emphasized the need to export, the need to get these in other places. I guess it also helps to make them cost-efficient when you do that. But is that CBC's responsibility, or is that your responsibility? I thought you were the distributor?
Mr. Slone: Indeed, our job is to do all the distribution internationally. But to my earlier point, we have a system here that requires a strong base at home from which to build the export market, and part of that strong base is the funding piece that comes from, on the film side anyway, the pre-licensing of programming. In other words, to get budgets, and budgets are substantial on a film, up to the level they need to be, you need to be able to count on a certain degree of support from the broadcast sector, TV. If there's any organization that has an ability to say, "You know what, I'm going to step up ahead of time and I'm going to make a bet that this is going to be good, like they did with 'The Book of Negroes,''' then I think it is the CBC. It's a perfect example. They have the ability to say it's worth it and we're going to take the risk and we are going to do it. We can create something great and we can export that.
I agree with you completely: They are not responsible for export, but they are responsible for the part of the funding that makes sure the content itself is excellent.
Ms. Steinmetz: And also in having the discussion, which is what happens in the process where you work with a broadcaster: You talk about budget, about how much contribution, how much risk people can take, and how much we can take to take the product out to the international marketplace. So there's a balancing act there. It's a collaboration, and that really needs to be fostered.
Senator Eggleton: Ms. Steinmetz, you mentioned earlier to the previous question I had that it's important not only to have good-quality product but also to be able to promote it as well. You cited the fact that the private television networks are picking up programming from the United States, whether films or series, and they get promotional stuff with it, because for that big market they've got a big blast of promotional stuff. How do we level the playing field here in terms of Canadians? Is it a matter of more money, or is there something else that could be done to help make sure that the quality product that we've got gets that kind of attention? A lot of people in this country watch American television, whether it's on Canadian channels or American channels, depending on where they live. The seduction of the promotion is substantial. How do we level the playing field from what you're saying is very comparable in terms of quality of the product?
Ms. Steinmetz: It's a complicated issue. As producers and distributors, you only have so much at your disposal. Producers in particular don't have the dollars and also the platform to promote the projects. The broadcasters have the airwaves to do that. I don't know if it's back to looking at the core mandate of the CBC and what kind of budget to put against that and potentially looking at what the marketing budget should be. If they're taking care of Canada, internationally as a distributor it's our job to promote the projects on the global stage.
Senator Eggleton: I think that's it.
Senator Plett: Ms. Steinmetz, you talked about how you were a partner with CBC.
Ms. Steinmetz: Yes.
Senator Plett: Is CBC a partner or a client, and what's the difference?
Ms. Steinmetz: They're definitely licensing a product from us, but we tend to look at all of our financing partners as partners. Nobody is making a production by themselves. It takes everybody who is involved in the creation of that project to work together to make it as successful as possible. So, yes, we refer to them as partners, same with any broadcaster.
Senator Plett: You've talked about money, you've talked about the fact that you're competing with south of the border and they have more resources. As Senator Eggleton has rightly said, there have been cutbacks by at least both federal governments over the years. Has it gone too far? We are grappling with that and wanting to come to some conclusion on that. But I don't think we could ever throw enough money at the CBC or any broadcasting corporation that would anywhere closely compete with the money that there is south of the border.
I think that, many times, it's not just the program itself. You have "The Book of Negroes.'' I'm certainly going to watch the program, but I don't think you have in there any well-known actors. Maybe you do, but nobody that really jumps out at you. We have great Canadian artists. My wife talked about singers. We have actors who really have made their name south of the border. Yesterday, many of us watched the very, very sad funeral of Constable David Wynn, and on there they had some great Canadian artists. The Rankin Family sang there. Paul Brandt sang there. Then, they had a no-name from Nova Scotia who did a wonderful job of singing on that as well, but these were artists who made their name south of the border. How can we ever compete? We can't put that much money into it.
Michael J. Fox, Canadian actor. If somebody with that name would jump out at you in "The Book of Negroes,'' I think you would be that much more interested in watching it. At the end of the day, I think it's all about ratings. We've talked about that and argued about whether it's about ratings, but if people don't want to watch it, we can't keep on putting more money into it.
I know there's a lot of comment there rather than question, but would you comment on that?
Mr. Slone: To the last point first, I do agree with you, of course, that there is no point in putting programming on that nobody is watching. It makes no sense. If that's what's happening, we're not making the right kind of programming, and it needs to be fixed. Having said that, to my earlier point, I don't think it's about sheer numbers. I think the rating is one important piece that we should be looking at when we're considering whether it works or not, but the kind of stuff that might get you the absolute highest ratings is not necessarily what we, as taxpayers, should be funding through our tax dollars. There should also be other aspects of that mandate — the cultural aspect, the quality aspect, the aspect of serving constituencies that aren't otherwise served on other broadcasters. To use an example, for First Nations, is every show that has First Nations characters in it going to be the highest rated? Perhaps not. But are they underserved and not represented on television? If so, do we also have a responsibility to balance those things along with the ratings question? I think the answer is yes.
As film and television makers, one of the things we always look to do is to find those underserved niches. When we had the great success with The Grand Seduction this summer, to use an example, we decided very distinctly that we were not going to cast it or design it to be for 18- to 24-year-olds, which is the prime movie-going demographic. They go to more movies than anybody else. We recognized that for an audience over 40 years old, there was a lack of product in the summer in the theatres. There was Spiderman 2 and Guardians of the Galaxy, but there wasn't anything for an older crowd. We put it right across from all of those movies. We put it out in May. It played till October. It was crazy. It was made up — I saw it when I went to the movie theatre — of an underserved audience. They may not be the largest audience, but were they ever happy to see that movie. They came out in droves, to the tune of millions of dollars of box office. I do believe that if we're careful and make the right product for the niches that are underserved, we can actually build great audiences.
Senator MacDonald: Thank you for being here this morning. I apologize for being late. I had another meeting scheduled, and I had to get to it.
Just a couple of quick questions. I have to mention one thing. You mentioned "The Book of Negroes.'' I'm from Louisbourg. It's my hometown. They were there filming it a year and a half ago. In early April, Louisbourg can be a really cold place. They arrived in one of the coldest weeks. It was just above zero all week and cold and foggy and damp. If they survive that week, they will survive anything. They'll do well. I'm looking forward to seeing the rest of the show.
You mentioned "Trailer Park Boys'' being picked up by Netflix. That's set straight around the corner from my house in Dartmouth, not far, and I know a lot of the guys. That was such a great success. I remember that the first time it came on, I thought it was a documentary. I didn't know what it was. I got glued to it and then realized what it was. It was initially on Showcase, and Netflix picked it up. Why wouldn't CBC pick that up? What's their mindset?
Mr. Slone: To my earlier point, if there are private broadcasters or other entities that want to air it, I think they should be the ones to air it. I feel that CBC is not there just to compete head to head with all of these things, to pay the most they possibly can in a marketplace that otherwise wants to buy the product. I feel that we can accomplish two things. We can have "Trailer Park Boys'' on private broadcasting and, at the same time, ensure that "The Book of Negroes'' gets made and is also broadcast. We're serving two very different audiences there. I think that because "Trailer Park Boys'' had a high commercial value, it was expensive and probably outside of CBC's ability to pay for it. I also kind of think that that's okay.
Senator MacDonald: Maybe they should have gone after —
Mr. Slone: Maybe.
The Chair: I'd like to thank the witnesses for the presentation. As you can see by the questions, there was a strong interest, and I hope you'll be following us over the next few weeks and months while we go forward with this report. Tomorrow, we will here from Mr. Alain Saulnier. He is a former executive director for news and current affairs for Radio-Canada and the author of the book Ici ÉTAIT Radio-Canada.
Honourable senators, the meeting is adjourned
(The committee adjourned.)