Proceedings of the Standing Senate Committee on
Transport and Communications

Issue 9 - Evidence, October 21, 2014


HALIFAX, Tuesday, October 21, 2014

The Standing Senate Committee on Transport and Communication 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: We are continuing our study of the challenges faced by the CBC, the Canadian Broadcasting Corporation, in relation to the changing environment of broadcasting and communications.

The committee is pleased to commence its hearings here in Halifax. The fact that three members of the committee come from Halifax did bring a little pressure, not a lot, but it is a pleasure. This is the first public hearing and we are holding it here because obviously the perception of how CBC and Radio-Canada plays its role is very different from Toronto to Montreal to Ottawa and how it's perceived in the rest of the country.

I'd like to also acknowledge, and we're happy to know, that our colleague, Senator Mercer, who is a regular and very active member of the Transport and Communications Committee, is going toward a speedy recovery, and we look forward to having him back at our meetings as soon as possible.

That being said, I'll give the floor to Ms. Kelly Toughill who will be making her presentation this morning.

Kelly Toughill, Director and Associate Professor, School of Journalism, University of King's College, as an individual: Thank you. As your first witness, let me say welcome to Halifax. I do think it's really appreciated by everyone in the regions when committees like this travel, and you're right that the perception of CBC, the use of CBC is very different in different regions.

I study emerging business models in journalism specifically, what people are doing to make journalism sustainable and also how those business models change the nature of journalism content. I'm going to start with an excerpt from the Web, the introduction to the CBC Annual Report that was released on October 9, and here's the quote: "The reality is the public broadcaster is currently not sustainable."

That's a pretty unusual preamble, a pretty extraordinary thing for any organization to say as they're introducing their annual report. So that's a pretty extraordinary thing to say in your annual report, "We're not sustainable." I think it's accurate. I think there's a chance that the CBC might be gone in a decade, and that's because it's being forced to adopt a dying business model that other media organizations are fleeing as fast as they can. So historically there is almost no business model for pure news and current affairs.

Pure news has always been subsidized in one way or another. For the l70 years or so it's been through advertising. But the advertising-supported business model for news and current affairs is on its last legs. Some news organizations will survive by turning to a subscription model, by generating profits for their telecom, cable and Internet service provider corporate parents; by becoming PR organizations or by selling customer data. But none of that is going to work for the CBC. The problem is not technology and not the Internet. The problem is plain old fragmentation, the move to niche marketing.

For most of the Nineteenth and Twentieth centuries, advertisers wanted the biggest audience they could possibly get. Newspapers and then broadcasters sold their readers and viewers to advertisers. The audience was the product and, the more of it you had, the more money you made. That started to change at the end of the Twentieth century as advertisers began marketing to smaller and smaller segments. This was very bad news for mass media, including the CBC. Specialty channels grew as conventional TV shrank, both in absolute dollars and as a share of the advertising market in Canada. In the year 2000 about 40 per cent of all of the English language television watched in Canada was on a specialty channel. The figure today is about 60 per cent. So as ad revenues for conventional TV shrank, they actually doubled for specialty channels.

Obviously, the Internet accelerated the trend to niche marketing. Advertisers can now reach customers without requiring anyone to assemble an audience at all. The bulk of online and mobile advertising dollars go to Google and Facebook which use information and keywords in your profiles, email search terms and social posts to send targeted ads. So media companies used to sell access to their audience to advertisers. You know, they put the audience together; they delivered it. But now they're sorting that audience. They're offering different slices to different types of advertisers, but it's not based on the editorial content they consume. It's based on personal information gleaned from the digital footprint. So we're moving into an era of marketing to the individual, not even to segments. This is being accelerated by social media so actual brands are falling away and consumption is moving to the level of the individual story.

What does this mean to the CBC? Well, the public broadcaster is being told to increase other revenues at a time when news-related and even media-related advertising is in decline. The entire mandate of CBC works against niche advertising. One example, Radio 2 was given permission to start taking advertising in early 2013. Is anyone surprised that the ad revenues are lower than they expected? Who listens to Radio 2? Well it's a small slice of everyone because it's really a wonderfully eclectic station. I listen to it. My 24-year-old son listens to it. We have wonderful conversations about it. We don't buy the same things. We literally don't buy any of the same things. There is no crossover in our consumption patterns. That's a problem if you're trying to attract advertisers who want a specific audience.

How are media companies responding and why won't their responses work for the CBC? Many broadcasters smartly developed a roster of specialty channels. I mean, fragmentation has been around for a long time now. Then those broadcasters were absorbed into distribution companies, telecoms, cable companies, Internet providers. There is a synergy; there is an ability to profit from content if you have that kind of parent. It doesn't exist without it. CBC is not going to be developing profitable niches and still serve its mandate, nor is it going to start or be owned by a telecom or cable company. So some content companies are experimenting with native advertising. That, to generalize broadly, is doing PR gussied up as editorial. That isn't going to fly for a public broadcaster, and if they tried it, it would be strongly opposed by private competitors who need that channel to survive. So other mass media organizations are going behind paywalls online, counting on readers and viewers to pay for the creation of news and entertainment content that they consume. That's really in direct conflict with the corporation's mission. The corporation is supposed to "express Canadian culture and enrich the life of all Canadians." That's all Canadians, not just Canadians who can afford a subscription on top of cable and/or mobile fees. So the mandate of CBC is mass, but the business model of mass is dying and contorting in ways that really don't fit for this particular outlet organization.

This is tragic because mass media builds society, feeds democracy. It is the dialog of the public sphere. When we lose that, we end up talking to ourselves. Fragmentation of media properties leads to polarization of editorial views and potentially politics. So Internet search algorithms tend to reinforce our own biases by drawing on our own past history to guide results. So in a world without mass media there is a danger we won't be exposed to the views of others or to the range of experience in our own community. So there is a business model out there that works for a public broadcaster but it requires a commitment from the nation that's hosting that public broadcaster. CBC's new strategy calls for the public broadcaster to be the public space at the heart of our conversation. It should be. But whether it will be is completely unclear to me at this point.

I was told to limit this to five minutes and I took it quite seriously, so I'm going to stop talking now and take questions.

The Chair: Thank you.

Senator Plett, first question.

Senator Plett: Thank you for being here. I certainly appreciate many of the comments you made. I am from Winnipeg, so like you, I am from a relatively small city or small province when we compare ourselves with some of the other provinces.

You say that there is proof out there that there is a business model that exists that is successful and I would like you to explain that a little bit. Before you do, I think we need to look at viewership. We need to look at a host of things. I appreciate you are one of the few people who has said the Internet isn't one of the main problems. I'm assuming with that you maybe mean the "Netflix's" aren't one of the problems either. But before we can say that there is a business model that works, I think we need to make sure the people want to watch what they're paying to watch.

We had unions come in recently in Ottawa and you've probably read about it and it seemed that their solution to the whole problem was, "Give us back the $115 million and then give us some more after that and then everything will work as long as there is enough money being thrown into it." I'm not ready to buy into that. If there is a business model out there that you say there's proof that it works, what is that business model and what proof is there that it works?

Ms. Toughill: I was referring to a business model for a public broadcaster specifically. The business models in the private space are really still in flux. I do think there are business models there but I don't think I should spend a lot of time talking about them. For the public broadcaster, the business model is largely national support, largely tax dollars. If I were a private broadcaster and I saw the subsidies that CBC got and then had to compete with them for the advertising dollars that are left, I'd be pretty irritated. The business model for many other public broadcasters is actually that they're not allowed to compete in the advertising space. So the business model is: The taxpayers decide that this is a service that they want and then they institute some kind of mechanism — you know, the BBC has a tax on TV's for instance. Other places have taxes on telecoms. So you have a collective decision that that's what you want to do. Pretty simple.

Senator Plett: In Halifax, or in Nova Scotia, tell me — when I talk to people on the street in Winnipeg — I mean certainly we had "Hockey Night in Canada" so everybody wanted "Hockey Night in Canada." Obviously it was entirely impossible for CBC to compete with Rogers in keeping that programming, and we all understand that. When I talk to people on the street, they are not suggesting that CBC shouldn't be there. They are just suggesting that they don't want to pay their tax dollars into it, and CBC should try to somehow live without the large subsidies. When I checked in here yesterday — and I hope the young ladies won't mind that I say this — they asked me whether I was here for a conference, and I told them why I was here. The two young ladies — one said she was originally from the United States — both said, "Don't get rid of CBC. We need CBC. I watch CBC. It's my favourite television station to watch." I appreciated that. But when I talked a little bit about the subsidies, their tone changed a little bit. "Oh no, we shouldn't necessarily be paying for it if we don't want it." So how do people on the street in Halifax feel about the tax dollars that are being spent? We were told that we should go from — what is it now, $23 or $29 a year per person and we're supposed to raise that to 42. Can you tell me what your thoughts are on that?

Ms. Toughill: I think it's difficult to ask the public tax questions in an honest and fair way because it is so easy to trigger specific responses. So most of the conversations I have around the CBC tend to be its value in its use, do people either watch it or listen to it.

I just wanted to get back to one of your earlier points which is viewership. One of the problems right now is how you measure audience. Because it's not just television. It's not just radio. It's not just online. You need to look at the penetration of all of those within the culture. So it might be that CBC doesn't do television in 10 years, that it does online and radio. So taking a look at its impact on the country isn't just who is sitting down to watch it at night and I just think that's an important point to make.

I have to say those conversations are not many for me . I would be very interested in seeing a well-designed poll. I suspect you would see very different answers across the country to the depth of commitment and the willingness to support CBC.

Senator Plett: I agree with the last comment about the poll. I do not agree that taxpayers aren't smart enough that they should be able to tell us what they want to watch and how their tax dollars are supposed to be spent —

Ms. Toughill: That isn't what I said; that isn't what I said at all.

Senator Plett: I think that they should definitely — we should be listening to the people. When viewership goes down for any broadcaster they need to look at that: "What's my percentage of the viewership?" It's the case in any market. "What's my percentage of the market."

I'll turn it over for now, Mr. Chair.

Senator Unger: Thank you very much, Ms. Toughill, for your excellent presentation. You have said a couple of things that I find very interesting. The mandate of CBC, of course is to try to present content for all Canadians. I live in Alberta and I can say that I believe generally the CBC is irrelevant. Like you, I'm a person who does listen to CBC but only for the classical music. After that I turn it off. The news content, in my opinion, on both TV and radio, especially TV, I stopped watching that about 15 years ago. It was three or four stories. That was it. They were lengthy stories and they always seemed to have a particular slant to them so I get more news by listening to AM radio and I will get several news stories. You mentioned the — what was your word — fracturing of the listeners. Do you think CBC has recognized this changing dynamic and has taken any steps to try to be a part of the changing landscape to mitigate their own circumstances? Have they been following this trend and trying to stay with it?

Ms. Toughill: They have been to some extent, yes. For instance, their move into music, they were attempting to assemble online music channels.

I should back up and say I mostly look at journalism, not the broader media issues, but they were attempting to develop specific music channels that appealed to very specific segments. They were doing that through CBC.ca music. Their new strategy, actually their very first pillar, talks about going from broad to focused with "consciously targeted audience segments." That makes some economic sense. It really worries me because the reason to do that is to chase the people who have money, and I think that that's not necessarily consistent with the CBC mandate. I do think that they are attempting to do that but they're trying to fit it into their mandate and it's not always a good fit.

I would also just ask you if, in your CBC consumption, you ever go online for news or other content? You know, on your smartphone do you go to CBC to get an update?

Senator Unger: I don't have a smartphone. On occasion I do go online, but I prefer radio because it's in the background and I can be doing other things.

I would also agree with my colleague Senator Plett that taxpayers get it. I talk to people as well. I don't meet many people who watch CBC television, "Hockey Night in Canada," being the exception. A few are like me but they're my age dynamic. I don't know anybody who watches or listens who is in the younger generations, and when you tell people how much money CBC is getting from the taxpayers and that that's not enough, money is always the issue and it's the issue that most people hear about. So I think there are many strong opinions supporting Senator Plett's comments.

Ms. Toughill: I don't think I in any way disputed those comments, and I don't think that I would suggest anything other than the most transparent approach. I mean, if the country does decide to support CBC wholly, it would have to be absolutely transparent in a way that people could see it; in every way such as, for instance, the U.K. has done with its tax on TVs. Nor am I suggesting that taxpayers don't get it. That would be silly. We're in a democracy and we govern ourselves and, as a journalist, it's a founding principle for me that the public actually does get it. It's my job to help them understand.

Senator Unger: Thank you.

Senator Cordy: Thank you very much. As one of the two Atlantic Canadians on the panel this morning, it's interesting because when I drove to work this morning, it was CBC Radio that I had on and it's the channel that I have on my car radio 90 percent of the time. So I would say, and you made reference to it earlier, that there are certainly differences depending on what region of the country that you're from. Is that something that you would expand upon or would you just speak specifically to Atlantic Canada or to Nova Scotia in terms of the CBC?

Ms. Toughill: Well all of the measurements show some profound differences, region to region. For instance, in English language Canada, television viewership is really only about 5 per cent for Canadian programming but, if you go into Quebec, or if you go into francophone Canada, the penetration of Radio-Canada is more like 13 per cent. That's one example.

When the local shows were changed — well they've been changed many times, but this was the change about seven years ago — the differences in ratings in Toronto and P.E.I. were and are dramatically different. CBC was by far the predominant source of news in P.E.I. and Newfoundland with something like a 50 per cent share. That's not an actual statistic. That's just my recollection.

I lived in Toronto for a long time. CBC was one of many players in Toronto, so its impact across the country is very different; radio, TV but also online, and its online impact, I think, is great or greater than its radio or TV impact.

Senator Cordy: You also spoke about a report by CBC, an annual report, and we talked about the lack of sustainability. You spoke specifically about the mandate. How will the mandate of CBC have to change in order for it to become sustainable and how would you sell the changing of the mandate to Canadians, which would be a challenge?

Senator Plett spoke about increasing tax dollars, and I think that Canadians would be reluctant to see a significant increase in funding for CBC. Having said that, how can we change the mandate, get a buy-in from Canadians to change the mandate without it costing significantly more dollars than it's costing today? Perhaps, if you could answer that you would be the chair of the board of the CBC.

Ms. Toughill: I think that if you change the mandate of the CBC to allow it to move into the emerging business models that work, you then put it in more direct competition with private broadcasters which makes whatever subsidy is left even more unfair, and you get away from the reason to have the CBC at all. So you would have to change the mandate in a way that really allows and encourages them to chase specific targets in a way that is going to help bind the country together. I think it's extremely unlikely, but I'm an academic, so I get to suggest things that are unlikely: If taxpayers did decide to further fund CBC, I think you could almost see that as a subsidy to private broadcasters because you would have to prohibit CBC from taking advertising and those advertising dollars would go to private broadcasters so it would be, in some ways, a shift from CBC. It would be almost a flow-through.

Senator Cordy: Do you think that there would be a need for more openness and transparency on the part of CBC if they were to continue to receive taxpayers' dollars?

Ms. Toughill: Yes.

Senator Cordy: Thank you.

Senator Greene: Thank you very much for coming. I tend to watch PBS more than CBC, so I'm interested in knowing what your view of their business model is and whether that business model could be applicable up here in Canada to replace the CBC model. My understanding of the PBS model is that it's a mix of government, corporate sponsorships, and viewer donations and subscriptions, but not advertising. What do you think? Could a model like that work up here?

Ms. Toughill: It could. PBS is in many ways a niche player, so PBS does not attempt to attract all Americans. It doesn't attempt to serve all Americans. It doesn't attempt to knit together the nation in a way that the CBC attempts to do.

Senator Greene: What is its mandate then?

Ms. Toughill: I don't have it in front of me and I haven't particularly studied PBS. I'm obviously familiar with PBS. I watch PBS when I go to the States, so I'm familiar with it but it's not a Crown corporation. It's not an arm of the American people in the way that CBC is an arm of the Canadian people.

Senator Greene: Yes, I guess that's right.

I'm really impressed by PBS. The quality of their new programming is a bit dryer than ours, but it's not commercial-based and so they spend a lot of time with each story. But also the quality of the documentaries and the programing and even the entertainment is much higher, I think, than what the CBC can do.

Ms. Toughill: I really like their news operation a lot. They don't do any local or regional news. They really focus on national.

Senator Greene: Yes, they do.

Ms. Toughill: One of the ways that I think CBC helps the national conversation is that they do reflect local communities, and that's an important part of the mandate. If CBC was just produced out of the broadcast center in Toronto, you would not see the kind of penetration that you see in viewership for Halifax or P.E.I. or British Columbia or Nunavut.

Senator Greene: If this committee were to make no recommendations, what ultimately would be the future of the CBC? We don't have to make recommendations. We can just leave it alone. If we do that, it strikes me that it will just have a slow, agonizing death. Do you share that view?

Ms. Toughill: Unfortunately I do, yes. I think we either need to support the CBC in a more significant way and take it away from competing with private broadcasters or we can watch it die a slow and, as you would say, painful death.

Senator Greene: There is no other alternative, in your view, between death and increased government participation?

Ms. Toughill: There are always other alternatives. It may be that CBC will decide that it doesn't want to do television any longer. It may turn into the nation's online news and content service.

Senator Greene: Right. That might be a very good idea actually.

Ms. Toughill: It might, but I think there's always going to be pressure on the public subsidy until there's some kind of transparent funding that taxpayers can see and understand, as I think Senators Plett and Unger would appreciate.

Senator Greene: Yes.

Ms. Toughill: So even if you left the existing funding scheme in place, I think five years from now we would see pressures for less public subsidy, unless it becomes more transparent.

Senator Greene: Right.

Ms. Toughill: But I don't think CBC can continue to do what it does under the existing funding regime.

Senator Greene: I agree with that, absolutely. Thank you.

The Chair: Senator Plett on the second round.

Senator Plett: Thank you.

Instead of dying a slow, painful death maybe there should be assisted suicide.

Ms. Toughill: Well, I think that's a reasonable conversation to have at this point. I think it's a reasonable conversation to have: Do we want the CBC or do we not want the CBC? Surely the Government of Canada can use that $1 billion elsewhere in a useful way. I think and clearly believe that CBC is a national good, that it serves a purpose in much the same way education and healthcare do. But I would like to see a national debate about do we want it or don't we?

Senator Plett: Well I certainly agree with that.

I want to build on what Senator Cordy talked about and what I talked about earlier about taxpayers' dollars. Both of the two parties that have been in government over the last years have made some cuts to the funding of CBC, and I don't think there was any backlash to either party when they did that. I think most people again said, "Well, maybe you didn't do enough." I know certainly I'm hearing that. When I look at CBC's mandate, and we keep on saying that, "The CBC's mandate is to present Canadian content." You're saying that maybe they need to go to radio and go to television and maybe that is the answer.

However, let's talk just about their news for a second and we're comparing them with American television stations, with BBC in the U.K. When I turn on "The National," and I do watch the "The National," that is exactly what it is: It's national. There is very little Canadian stuff there. It's international. It's not national; it's international. Should CBC at least, in order to make some cuts, and it seems like CBC is no different than anybody else. They get $115 million taken away. Then they lay off 500 people. Instead of laying off a few people at the top, they lay off a whole bunch of people at the bottom, and that seems like what all large corporations do when they get cut.

What is your opinion on what they are doing internationally? We have the CBC; we have CTV; we have different television stations all bringing us news about the Ebola crisis in Africa. Would one station be enough to bring us that news? It's basically the same whether I watch CTV or CBC. Is it necessary for us to have that much international content in CBC?

Ms. Toughill: Two things: One, I want to comment on your experience of CBC as "The National." For most of the country I suspect their experience of CBC news is local and regional programming. So as to the conception of what their news operation is, I think there may be a disconnect certainly between you and me.

I consume a lot of CBC news and I watch "The National" occasionally because I have to; I'm not a big TV viewer. I don't think that CBC and CTV and Global coverage of international issues is necessarily the same at all. So CBC has correspondents around the world and CTV and Global largely don't. They rely on other networks. They rely largely on American networks. For instance, if there is a war and you're relying on American correspondents to cover it, if it's a war that you're not in, they're probably going to be bringing different perspectives to the news than a Canadian correspondent would bring. Perhaps that is not the case with Ebola. Although the issue of how Canada would handle it as opposed to how Texas is handling it can be different, depending on whether CTV is taking a feed from NBC or CBC has its own correspondent.

Was I clear there? Did I answer your question?

Senator Plett: Yes, I think it's clear. I've said it many times that I have the highest regard for any of the journalists, whether it's CBC or anybody else, covering the wars. I'm not sure that I entirely agree that CTV doesn't do it as well. I think we've seen CTV journalists out there under their beds sticking a microphone out the window as we have seen with CBC, and I have high regard for those journalists out there. You made yourself clear, and I agree that I would not want to simply rely on American networks to bring us the news about a war in Iraq. I fully support and would want Canadians out there as well, whether it's CBC or CTV.

Transparency: If you've been following our committee hearings, and I'm sure you have, we have been trying to get information out of CBC that they have been very hesitant to give us. Give me again, a little more clearly, your opinion on, considering even the subsidies they get today, how transparent should they be? When we want information about the BBC, you and I can go on the website and we can find out what the top anchor makes and we can find out what the guy in the mailroom makes. How transparent should CBC be considering the subsidies they get now?

Ms. Toughill: All aspects of their economic model should be completely transparent. You would have to remind me of what information you haven't been able to get.

Senator Plett: Salaries.

Ms. Toughill: Yes. We should all know what everyone at CBC makes. That's pretty obvious.

Senator Plett: Thank you.

Ms. Toughill: I think that journalistic operations — I would not want to see an FOI request for all reporters' notebooks. That, I think, would interfere with the ability to serve Canadians.

Senator Plett: Right.

Ms. Toughill: But every dollar of what CBC spends should be available to the public.

Senator Plett: Last question: Again, things are changing and we may have a difference of opinion as to whether the Internet is interfering — Netflix. When CBC started, clearly I think every Canadian understood that every Canadian should have access to news, and so CBC needed to go into areas where no private broadcaster would go because they couldn't make money. Those days are over with satellite, the Internet, whatever. I can go to Tuktoyaktuk or Resolute Bay and I can watch every television station out there. I can go on the Internet. I can get all the news I want.

We were in Yellowknife and CBC has a huge operation in Yellowknife. Now I'm not saying they shouldn't have, but the dynamics have changed with the Internet, satellites and so on and so forth. Should CBC then not somehow try to cut back operations in that regard?

I said that was the last question, but I'll just add a supplementary to that. You being from Halifax and me being from Winnipeg, I used to think TSN meant Toronto Sports Network. We've heard here over and over again at our committees that CBC is in Toronto and in Montreal and not in the smaller locations. So tell me a little bit about satellite and whether they should be changing there and whether they should just simply be downsizing and becoming more regional.

Ms. Toughill: That's a big question.

Senator Plett: I know it is.

Ms. Toughill: On the remote areas, are you asking me whether they should downsize their content producing operations there?

Senator Plett: Yes.

Ms. Toughill: I'm going to hedge on that question because I don't know enough about the economics.

Senator Plett: Right.

Ms. Toughill: Certainly the technology has changed. Technology has become much cheaper, but whether it's really economically viable for private broadcasters to service those areas, I don't know.

I can tell you that news and current affairs is almost never economically viable on its own, so very few places are going to start those operations unless they have to. That's my hedge on your first question.

The second question was should CBC become more regional and local?

Senator Plett: More regional and local and maybe downsize their operations in Toronto and Montreal and make us all feel like they are, in fact, the Canadian taxpayers' broadcaster.

Ms. Toughill: I think if they can make us all feel like they are the Canadian taxpayers' broadcaster that would be a good thing. How they do that, I haven't done the level of research to give a new operations plan for CBC at this point.

I can tell you that in certain regions they certainly feel like that already. I was a reporter here for many years before I became an academic. I was working for a national news organization, and it didn't matter which little story I went to, CBC was there, really reflecting Canada. So if I was covering Aboriginal fishing stories in New Brunswick, Toronto and the rest of the country was getting those through CBC, not through Global and CTV.

Senator Unger: Have you studied the nature of citizen journalism, public reports, news and information and the impact of Twitter? Things are happening that are being reported instantly. It's a new phenomenon. Have you studied that at all in particular in relation to a broadcaster like CBC?

Ms. Toughill: I've studied that in general terms, particularly how the whole issue of crowd sourcing and citizen news fits into emerging business models and how it's changing workflow within news organizations. I think I might need a more specific question to help you there. I mean, reporters are using this as a tool now everywhere. You can set a geo location on Twitter so that you can find out what people are saying, both about a subject and within a certain area. Social media, Twitter and other social media sites, are one reason that curation is now a huge part of journalism as opposed to just generating, going out and actually doing reporting but finding out, collating, aggregating and curating what other people are reporting, many of them not paid journalists. So it's quite a big topic.

There is an issue of verification with citizen news. The Boston marathon bombing is a famous example in which many news organizations used social media to name someone who was just not connected to the bombing in any way.

I guess I'm rambling here. That's a big topic and I can speak about specific aspects of it, but I'm not sure what else you're looking for.

Senator Unger: Just whether or not CBC is using citizen journalism as much as they could be.

Ms. Toughill: I think they're doing quite a good job, actually.

Senator Unger: I wouldn't know because, as I said, I don't pay much attention to CBC.

I'm wondering if they were privatized if they would survive in today's environment. I guess it would depend on advertising revenue and what they could garner. I mean, competition is pretty stiff.

Ms. Toughill: By privatized — I guess it would depend how that was done. If they were sold to another network perhaps some of their assets would be folded into that network. It's difficult. They certainly wouldn't survive as the national conversation for Canadians.

Senator Unger: On that particular issue I think of what is happening in British Columbia. There has recently been an issue about advertising, particularly in Richmond, in areas where public signs, stores and all of that are in Chinese only. The councillors are now looking at it to decide whether or not they should continue to allow that. They use neither of Canada's languages. So our country truly is multicultural. In Edmonton in particular, I don't feel that I know better what's happening in Atlantic Canada because I'm watching CBC. To me there's a real disconnect coast to coast. Our country is wide and diverse so I'm not sure it's even doable anymore.

That's a comment. I don't know if you have any thoughts. Although you have said that you didn't think it was.

Ms. Toughill: I do think it's doable, but I don't think it's doable in its current form unless you have very significant public subsidies. I think as long as you do and as long as you have advertising, you're going to have intense pressure from private competitors who say that's not fair.

The Chair: The final question by Senator Greene.

Senator Greene: You mentioned a national conversation. That's something I think we all understand, but I'm not sure really if in Canada we actually have a national conversation. The last time I think we did have one was in 1988 around the free trade agreement. We do have a lot of regional and local conversations, but a national conversation? I'm just not sure if that's possible to have in this country. If that's the case, then maybe the CBC is kind of a mission impossible.

Ms. Toughill: Right. I think that ebbs and flows.

Senator Greene: Yes.

Ms. Toughill: I think it depends how you use that term. I think we're having national conversations on all sorts of issues right now through the CBC and through other media, the issues around marijuana and how we deal with whether it is criminal or not criminal, and issues around the evolution of our healthcare system. Those are all national conversations. There are issues around multiculturalism, and how they play out in Quebec or in Richmond; all are national conversations. I'm kind of hoping we end up having a national conversation about the CBC as well.

Senator Greene: That would be nice, yes.

Ms. Toughill: We don't have a single issue that's riveted the nation in the way that the free trade debate did.

Senator Greene: Yes.

Ms. Toughill: But I think national conversations are more than that. They are how do we deal with climate?

Senator Greene: Yes, but wouldn't we have conversations with regard to marijuana and so forth even if we didn't have a CBC? We would still be having those kinds of conversations, and it's hard for me to understand exactly how the CBC facilitates a national conversation on marijuana.

Ms. Toughill: I think it does it partly by having stronger local and regional programming, so it can bring the Richmond story to Halifax in a way that — well, Richmond might not be a good example because it has good coverage — but it might bring the P.E.I. view on the new marijuana companies that are creating some significant jobs in Atlantic Canada. That's part of the debate.

Senator Greene: Good.

Ms. Toughill: That might not be appreciated in Toronto were it not for CBC.

The Chair: Madam Toughill, thank you on behalf of the committee members. You're a very good example of why we have these hearings on the ground, to try to get a different point of view on these issues, and I want to thank you on behalf of committee members. Do you have any closing comments?

Ms. Toughill: I want to thank you for having me and I wish you well in your work. I do think this is a particularly important topic, and I'm pleased to see that you are recognizing that the impact of CBC is different in different regions and that you will keep that in mind as you ponder the future of the organization as a whole.

The Chair: Before moving on to the next panel, I'd like to entertain a motion to allow TV and photography during the hearings, with the least possible disruption. We're not broadcast, but media might want to come in and I need a motion to do that.

Senator Plett: I so move.

The Chair: Senator Plett moved the motion. Does everybody agree?

Hon. Senators: Agreed.

The Chair: Thank you.

[Translation]

I would now like to invite the next panel: Marie-Claude Rioux, from the Fédération acadienne de la Nouvelle-Écosse; Bruno Godin, from the Société de l'Acadie du Nouveau-Brunswick; and Cyrilda Poirier, President of the Fédération des francophones de Terre-Neuve et du Labrador.

Bruno Godin, Executive Director, Société de l'Acadie du Nouveau-Brunswick: Senators, members of the committee, thank you for inviting the Société de l'Acadie du Nouveau-Brunswick to appear before the Senate committee today.

My name is Bruno Godin, and I am the Executive Director of the Société de l'Acadie du Nouveau-Brunswick, SANB. I will take a few moments to explain what SANB's work consist of. Our organization is the political voice of Acadians in New Brunswick and works to protect their rights and promote their interests. Our objectives are the recognition of a distinct Acadian society, the maintenance and creation of French and bilingual institutions, the affirmation of French in the face of increasing assimilation, and the safeguarding of rights in a context of government restructuring.

As you already know, New Brunswick is regulated by a piece of legislation that recognizes the equality of linguistic communities, making it the only officially bilingual province in Canada. Since the francophone minority accounts for about 33 per cent of the province's population, vigilance is required to ensure that the two linguistic communities have the same rights and privileges.

SANB supports our public corporation, Radio-Canada. We feel that the corporation's contribution to all of the country's francophone communities is clear. However, SANB wants to express its concern over the French-language programming on CBC's national networks and the Réseau de l'information, which often ignores regional realities. We are especially concerned about Radio-Canada, a network that should represent all Canadians across the country.

Under the 1991 Broadcasting Act, the programming provided by the Canadian Broadcasting Corporation should, and I quote:

. . . reflect Canada and its regions to national and regional audiences, while serving the special needs of those regions . . .

That is why Radio-Canada established regional news broadcasts, which cover local news. We can see that "Le Téléjournal Acadie" is fulfilling its role successfully and providing Acadians with information that affects them in their language, especially since "Le Téléjournal Acadie" is broadcast every day of the weekend.

However, Radio-Canada's national "Téléjournal" and other programs generally reflect the Quebec reality and especially the Montreal reality. In 2008, the Radio-Canada ombudsman admitted that the national "Téléjournal" was an issue, since most of the country's francophones live in Quebec. So most of the target audience of the national "Téléjournal" is in Quebec. However, as previously stated, the corporation's mandate is to, "reflect Canada and its regions." So it is important for this point to be taken into account, so that francophone news outside Quebec can be given appropriate coverage. We also think that Quebec is deprived of the wonderful accomplishments and successes from all francophone regions of the country, including Acadia.

In 2009, Marie-Linda Lord, professor and researcher at the Université de Moncton, conducted a study demonstrating that the number of news stories from the Atlantic provinces is significantly higher at CBC than at Radio-Canada. The conclusion of her research is in line with SANB's findings and the observations of a number of viewers from across the country regarding the low amount of coverage Radio-Canada gave to the shooting that took place in Moncton last June, when three RCMP members were killed. The New Brunswick francophones had to turn to the CBC for information on that incident. Jeanne-D'Arc Gaudet, SANB President, stated that Wednesday, June 4, is indelibly etched in our collective memory, as this incident reminded us that Radio-Canada and RDI Montréal are not in the least bit concern about us.

You may wonder who is being harmed by the television simulcast war our national network is engaged in with other Quebec networks. The answer is self-evident. We think that all francophones outside Quebec are hurt by this, including Acadians from the Atlantic provinces who are too often, not to say all the time, victims of the television simulcast war between Radio-Canada Montréal and Quebec's provincial networks. This competition leads to Radio-Canada's failure to meet its national mandate. Yet the corporation could provide a national perspective if it made an effort to do so.

That is why SANB wants to remind everyone that it is important for all francophone communities to be represented and to recognize themselves on national television. That would not only help us have access to news, but also allow us to participate in the building of our identity as New Brunswick Acadians. So this is a way to build a strong identity, which generally leads to success — both on a professional and a personal level — as well as to national and provincial vitality. This last point is particularly important for New Brunswick. I will close my remarks by saying that it is important to support local programming and take all francophone communities into consideration. Unfortunately, the leaders of our national Radio-Canada network largely disregard this. Thank you.

Cyrilda Poirier, President, Fédération des francophones de Terre-Neuve et du Labrador: Mr. Chair, senators, I want to begin by thanking you for your invitation to appear and for giving our community an opportunity to comment on Radio-Canada. My name is Cyrilda Poirier, and I am the President of the Fédération des francophones de Terre-Neuve et du Labrador.

Since 1973, the Fédération des francophones de Terre-Neuve et du Labrador has worked for the advancement, vitality and recognition of the francophone and Acadian communities of our province.

As the public broadcaster, Radio-Canada is supposed to cover the whole French-speaking community from coast-to-coast-to-coast in its programming and newspapers.

In spite of that, for a number of years, Radio-Canada has been a major source of concern and frustrations for our community and for the Fédération des francophones de Terre-Neuve-et-Labrador.

We have actually been noticing a constant decline over the years in the public broadcaster's coverage of French-speaking communities outside Quebec in general and in our province in particular — be it on television, radio or the web. Everyone knows that Radio-Canada's national programming dedicates only a tiny fraction of its content to what happens outside Montreal.

Unfortunately, we are seeing the same trend regionally. With just over 3,000 members, our community is still quite small compared to the francophone and Acadian communities in other Atlantic provinces. Nowadays, our community is recognizing itself less and less in the Radio-Canada Acadie programming, which is all too often limited to the Moncton or Halifax area.

The FFTNL reminds you that constituents appreciate hearing about what is happening in their community.

Quebec's political problems, as well as Moncton's municipal politics and cultural scene, or traffic bottlenecks on the MacKay Bridge, in Halifax, are taking over our airwaves in Newfoundland and Labrador. Like all other Canadians, our communities would also like to hear the political, economic and social news from their province and region.

We also find it unfortunate that a number of our most important regions are currently not receiving Radio-Canada's FM radio, or any other French-language radio station. An example of that is Corner Brook, which is the second-largest city in the province and has a growing francophone community according to the latest census.

How can we have any credibility in telling our students at École Boréale in Happy Valley-Goose Bay that they can develop and grow in French and that we have an opportunity to live in a bilingual Canada? That is difficult to do when they have no access to French radio or to our public broadcaster, Radio-Canada.

To try to address the current shortcomings, but also to adapt to the current modes of consuming audiovisual content and prepare for the future, we want news programs to provide coverage based on a true and fair geographic distribution. That can be done through a significant increase in productions from outside Quebec. Moreover, Radio-Canada should be systematically broadcast on FM waves in all regions with a significant francophone population. The digital transformation recently announced by Hubert Lacroix should become an opportunity that must absolutely be seized, so that all regions of the country can be treated equally. Lastly, Montreal should stop being the only visible tree in the forest. Our people should be easily able to find news on their region, but also programs that pertain to them.

New technologies and the Internet in particular have made distance irrelevant, in a way. Whether you are in Yukon, Montreal or Saint-John's, Newfoundland, a message now arrives at the same speed, and an online video is viewed simultaneously. Social networks make sharing with the entire planet possible, regardless of how far the content's producer is.

So these new technologies are ideal tools to help shift content production toward the regions and provide better opportunities for regional reflection.

In closing, the Fédération des francophones de Terre-Neuve et du Labrador feels that our public broadcaster is in a critical position and is on the brink of losing the national or pan-Canadian characteristics of its content. We once again want to reiterate how important Radio-Canada's existence is to us and are asking the federal government to provide it with the funding it needs to at least be able to fulfill its mandate.

We do ask Radio-Canada to use new technologies to redirect its content and production capacities to regions outside Quebec for greater equity.

Mr. Chair, senators, on behalf of all Newfoundland and Labrador francophones, thank you for your attention.

Marie-Claude Rioux, Executive Director, Fédération acadienne de la Nouvelle-Écosse: The Fédération acadienne de la Nouvelle-Écosse would like to sincerely thank the Standing Senate Committee on Transport and Communications for this invitation to share our thoughts on the importance of Radio-Canada for Nova Scotia's Acadian community. I am Marie-Claude Rioux, Executive Director. Our president, Ghislain Boudreau, was unfortunately unable to attend this morning, and he sends his apologies.

Incorporated in 1968, our federation was established to promote the vitality and overall development of Nova Scotia's Acadian and francophone community with the help of its members — namely, French-language regional, provincial and institutional organizations.

Our organization is a true federation composed of 28 member agencies working to advance the federation's mission. I shall dispense with paragraph number four, which covers our mission, as I know there is not much time to discuss the heart of the matter.

Radio-Canada is central to the federation's communications portfolio. In fact, Acadians and francophones in our province are very aware of the important role the public broadcaster plays in their lives. They know that no private broadcaster would be able to amass the necessary capital needed to broadcast radio and television programming and maintain a web presence in remote areas where audience ratings are lower. Radio-Canada is the only broadcaster that can provide quality French-language services to Nova Scotia's Acadian community.

Although the Acadians and francophones in the province acknowledge Radio-Canada's importance, our community is far from satisfied with its services, especially when it comes to the coverage of events in Nova Scotia. This dissatisfaction was communicated by the Acadian federation in a brief submitted to the Standing Senate Committee on Official Languages in December 2012. Although two years have passed since that presentation, it is clear that very little has changed.

One part of Radio-Canada's mandate is especially relevant to the Acadian and francophone communities as a whole. In 2007 and 2009, the Société Nationale de l'Acadie published the findings of studies into regional representation on the national radio and television network. These studies clearly indicated that the news, political commentators, experts and topics dealt with on radio and television overwhelmingly reflected what was happening in Montreal. Even worse, in December 2012, the corporation's Executive Vice-President of French Services, Louis Lalande, told the CRTC that regional content would not exceed 15 per cent of the nationally televised newscast. Given such a firm position, it is clear that an important story in our region would not be given the deserved coverage.

In her book called Le nombrilisme québécois, which I fully endorse, Quebec journalist Marjorie Pedneault provides many examples of national issues receiving minimum coverage because the news did not come from Quebec. Among them was the non-confidence vote against the Premier of New Brunswick, Bernard Lord. That story was covered with one image and two lines of text at the end of the newscast.

In fact, it is very rare for an Acadian expert — much less an Acadian from Nova Scotia — to be invited on a public affairs program to provide comments and a different viewpoint, even when that development has to do with a francophone region outside Quebec. The same holds true for variety shows, where Quebec artists — some of them complete unknowns — are invited to take part in several programs during the same week, whereas Acadian artists have to be superstars for anyone to pay them the least bit of attention. As for online news, on any given day, it is far more common to see news from Quebec and Ontario — as well as national and international stories — than news from our province, which is practically non-existent. For example, in the online news for Friday, October 3, 2014, the top story was the war against the Islamic State, four secondary stories dealt with international issues, two secondary stories were from Ontario and two other secondary stories were from Quebec.

In fact, it seems that reporters, researchers, producers and other artists view Radio-Canada as a regional station, rather than a national network. In Nova Scotia, people refer to it as Radio-Montréal rather than the SRC. This nickname clearly reflects how the province's Acadians and francophones feel. An insignificant story from Montreal gets preferential treatment over an important story from Nova Scotia. Acadians and francophones from our province also dislike the arrogance all too often exhibited by the hosts of the national network's programs. One example is the program "La soirée est encore jeune," broadcast on Sunday, October 19, where a contributor was reading an email from someone in Winnipeg and said that the program was being watched by people across the country, and that this was yet another indication that the network was fulfilling its mandate.

These observations are corroborated by the fact that programs such as "L'Épicerie," "La Facture" and others rarely come to Nova Scotia. Moreover, national and international stories are covered only from Montreal and feature experts from the province of Quebec. This situation is very detrimental to Nova Scotia's Acadians and francophones, who feel like second-class citizens. Our province's Acadians and francophones will not feel a sense of value by seeing and hearing only Quebecers on television and radio. Lastly, in the longer term, it is Quebec's heritage in all its diversity that will be preserved, to the detriment of our heritage and that of Canada's Francophonie as a whole. In short, Nova Scotia's Acadians do not recognize themselves in Radio-Canada's programming. They do not see themselves, or hear or read about themselves.

On the other hand, Quebecers, as my New Brunswick colleague said, are missing out on seeing and appreciating how Nova Scotia's Acadians live. We are sure that users in Quebec would appreciate the extended coverage.

For the previously stated reasons, we also find it very regrettable that Canada's francophone presence on the international stage is limited to Quebec. Radio-Canada not only adds to Canadians' lack of knowledge about the life and issues of Nova Scotia's Acadian community, but it also reinforces the international perception that Quebec is the only province in Canada where French is spoken.

We understand that current budget restrictions have forced Radio-Canada to rely on private companies to produce programs. However, we believe that this devolution of powers should nonetheless respect the corporation's mandate and Canada's regional diversity, regardless of ratings and advertising revenues.

Although the federation applauds Radio-Canada Acadie's coverage of major events such as election night, it deplores the preferential treatment given to New Brunswick over Nova Scotia and the other Atlantic provinces. For example, on Friday, October 3, 2014, Radio-Canada's online coverage for the Acadian region featured a lead story from New Brunswick and one from Prince Edward Island. Readers had to scroll down to the bottom of the page to find, under the heading "Dernières publications," one story from Nova Scotia, compared with one from Newfoundland, two from Prince Edward Island and five from New Brunswick. At the time, the Government of Nova Scotia was preparing to pass a health reform bill at third reading that would cut the number of health authorities from 10 to 2 and the number of health-related labour organizations from 50 to 4. The scope of this reform concerns all Canadian labour unions. In short, Nova Scotia is being marginalized both by Radio-Canada and by Radio-Canada Acadie online.

Radio-Canada produces only two French-language regional radio programs in Nova Scotia: "Réveil Nouvelle-Écosse" and "Au Rythme des courants." It produces no television programs in Halifax. Once again, Nova Scotia's Acadian community is clearly disadvantaged when compared with Moncton or Montreal. Radio-Canada's weekly radio schedule lists 32 programs produced in Montreal and 4 produced in New Brunswick. Nova Scotia has only 2 programs, both produced in Halifax. Moreover, three of the four programs produced in New Brunswick air only in Atlantic Canada, and none of the programs produced in New Brunswick or in Nova Scotia are broadcast across the entire network. Given Radio-Canada's limited coverage in our province, the federation is extremely concerned over the cuts announced by the public broadcaster. The journalistic coverage of events relevant to our community has already been limited to avoid paying overtime, the number of minutes dedicated to national news has been reduced considerably, and there are no longer any journalists covering the province's southeast, southwest and northeast regions. Should Radio-Canada have to make more budget cuts, where will those cuts be made?

In closing, despite the quality of Radio-Canada's production, the Acadian and francophone community we represent believes that the corporation could do a better job of fulfilling its mandate to reflect Canada and its regions to national and regional audiences, while serving the special interests of those regions. The federation is convinced that the cuts planned by Radio-Canada do not necessarily have to result in reduced services in Acadian regions. We would actually like to encourage Radio-Canada to do a cost comparison between producing a program from Montreal and producing it from Halifax. Over the years, the federation has presented many briefs, both before the CRTC and before various Senate committees, each time criticizing the lack of national Radio-Canada coverage on Nova Scotia's Acadian community. So far, those complaints have fallen on deaf ears.

We hope that the hearings of the Standing Senate Committee on Transport and Communications will enable the corporation to ensure that Nova Scotia's Acadians and francophones are better represented in its programming, that they get to know francophones in the other provinces better and that we are able to celebrate our diversity.

Thank you for your attention.

The Chair: Ms. Rioux, Mr. Godin, Ms. Poirier, all three of you are a good example why we have hearings like this one — outside the nation's capital, Montreal or Toronto — to be able to hear regional voices. I want to thank all three of you for the consistent message you have related.

[English]

I have Senator Plett, Senator Unger and Senator Cordy. Senator Plett, the floor is yours.

Senator Plett: Thank you to all three of our witnesses.

I don't know that I'm happy about the comment you made about CBC's arrogance in French, but at least I'm happy that their arrogance in French is the same as their arrogance in English, so I think we both feel that at times.

I'm also from a small market. I'm from the federal riding of Provencher. Provencher is probably the highest populated area of francophones outside the province of Quebec, so many of my friends that I see regularly when I go home are francophone.

Now I want you to pardon my ignorance here when I ask this first question: What's the difference between Acadian and francophone?

[Translation]

Ms. Rioux: Senator, there is a real debate right now on what makes an Acadian and what makes a francophone. We will hold our annual general meeting this weekend to better define the Acadian identity. Right now, some people identify as Acadians for a number of reasons, while others are referred to as new Acadians. They identify more as francophones because they speak French, but they do not necessarily have Acadian roots. We may be talking about Franco-Manitobans who have moved to Nova Scotia. We do not have many of them — not enough. We would like to have more.

[English]

Senator Plett: Mr. Godin, maybe I misunderstood your presentation, but you said that you felt there was not enough francophone broadcasting. Do you mean that there is not enough broadcasting in French or do you mean that there is not enough broadcasting in local areas? Obviously your issues in whatever community you're in are not French or English issues, they are issues for your region. Can you just explain that part of your presentation, is it that you don't get enough broadcasting in French in your communities, either, any of the three of you, or is that it's in the wrong language?

[Translation]

Mr. Godin: I would say that this is on a local level, Atlantic level, but the issue is that Radio-Canada pays very little attention to anything outside Montreal. Bear in mind that, in other Canadian provinces, we have no access to any French-language television stations besides Radio-Canada. So if Radio-Canada's national network does not report on events taking place in Acadia, we receive no relevant news. The most striking example comes from last June, when three RCMP members were murdered by someone and a 36-hour manhunt ensued on Moncton's streets. We had to turn to CBC to find out what streets and neighbourhoods were closed, since Radio-Canada Montreal did not bother to mention this. Had this happened in a Montreal or Quebec City neighbourhood, I think it would have sparked a media storm, while the story happening here received very little attention. So there is a big discrepancy between the regions and Montreal. A car accident on the corner of René-Lévesque and some other street makes the headlines. Three RCMP members are murdered in New Brunswick on a public street, surrounded by homes, and Montreal does not even see it fit to stop talking about the car accident — a minor fender-bender on the corner of René-Lévesque — to go to live coverage from Moncton. That being said, we do have some solid coverage — and I know that I disagree with my colleagues when it comes to this. They know that this is the only difference. We have not spoken to one another. We know each other well, but we have not spoken here. We feel that "Le Téléjournal Acadie" provides very good coverage for us in New Brunswick. That may be the result of having a secondary headquarters, where coverage is better. For us, the issue really relates to national news that we would like to watch. I regularly hear Acadians, very proud francophones, say it is too bad that they are watching Radio-Canada Montreal less and less and turning to CBC more. So we have to become anglicized to find out what is happening in Toronto, Manitoba, British Columbia, and even New Brunswick, Newfoundland, Prince Edward Island and Nova Scotia. That is what really bothers us.

I think I am really attacking the management, if you will, in a very peaceful way; they seem to want to continue to compete with the other Quebec television networks. However, it is not national Radio-Canada's mandate to compete with TVA or other television networks in Quebec. That is not its mandate in the least. It is supposed to be a national television broadcaster from sea to sea. And when it wages what I call a small war with the other, provincial television networks, that impacts us adversely, we the francophone communities outside Quebec.

I apologize for the long answer.

[English]

Senator Plett: Ms. Poirier, you said that there should be better coverage where there is a significant francophone population, were the words you used.

Ms. Rioux, you spoke about cuts.

This question is to the two of you: When you talk about there shouldn't be any more cuts, or the cuts should be given back or I'm not sure what it is, were you suggesting the cuts that the government made to the subsidies or were you talking about the cuts CBC or Radio-Canada made in their operation? That is number one.

Number two, to Ms. Poirier or any one of you: What do you consider a significant francophone population and to what extent does CBC, Radio-Canada come in and do what we all want them to do in the smaller communities? I'm sure the people in Ste. Anne, St. Malo and St. Pierre in Manitoba in my riding are asking for many of the same things, but to what point does CBC do this and what is a significant francophone population? They need to live within their means somehow.

[Translation]

Ms. Rioux: Senator, with your permission, I will reply to both parts of that question.

Regarding the cuts, all three of us are from the community environment. Community organizations are subject to constant cuts. We know the impact of these cuts practised by the granting authorities. However, the fact remains that as managers we are also responsible for allocating the funds at our disposal to ensure the best possible results, given the funding we do receive. My personal criticism would not be about the government cuts to Radio-Canada; personally I am convinced that we can do less with more, and that the decision to allocate the funds belongs to the management of Radio-Canada. However, I do have a problem with the fact that the cuts are much more important, have far greater impact, when they are done in the regions rather than at Radio-Canada in Montreal. Do you see what I mean?

I already said what everyone thinks, which is to say that when you say Radio-Canada, you think Montreal.

In my brief I encouraged Radio-Canada to carry out a cost analysis to see whether it really costs more to produce from Halifax, for instance, rather than to produce in Montreal; I am not convinced that it is less expensive in Montreal. I am sure that considerable savings could be achieved by doing more production in the regions. That is the first issue.

Now, what do we consider to be an appreciable francophone population in Nova Scotia? To me, that is very clear. Wherever there is a French-language school, there is an important French-language population. So, to go back to what my Newfoundland colleague was saying earlier, in Labrador, there are areas where they do not pick up Radio-Canada. The same thing applies in Nova-Scotia: in Truro, they no not pick up Radio-Canada radio broadcasts, and yet Truro has a French-language school, and there is exponential growth there. I was the director general of the parents’ federation when Truro opened its school to 10 students, and there are now over 250 or thereabouts; the school has been expanded, a community centre has been built, and so there is abundant growth in that area. Despite that, if you are there, you cannot tune in to Radio-Canada.

Ms. Poirier: I will begin with the community; what is a significant community? My colleague was much more generous than I. I said that any place where there is more than one person is a significant community, but —

[English]

Senator Plett: Oh, wow!

[Translation]

Ms. Poirier: That said, my colleague is quite right. Where there is at least a French-language school, or a school centre, wherever there is an active, growing community, you have a significant community. If people felt that a school had to be built, it means that there is an upcoming generation, that there are people there, who deserve to have adequate service from the public broadcaster, Radio-Canada.

I think my colleagues have said enough about budget cuts. I will give you some concrete examples, since I use examples a lot. This summer we had the experience of bringing back three morning programs to Moncton, that is to say the "Le réveil" program, from New Brunswick, Prince Edward Island and Halifax. Since we do not have a production studio in Newfoundland, we make arrangements, and I told myself that this was the beginning of the end. I think it is only a matter of time before our morning programs are all managed by Moncton to the detriment of our communities.

Regarding the budget cuts, I would say that for the most part the regions, the regional communities are the ones that absorb those cuts. We hear about budget cuts in Montreal or in Quebec, but very little, and in any case they are the ones who reap any benefits. Let me give you an example: On Espace musique there was a morning program that came from Moncton. It was a very good program. Espace musique is made up of cultural programs and we heard about our artists on it. Perhaps there was a lot on it about New Brunswick, but be that as it may, at least we felt our culture was there. That is the first thing that was cut and sent to Montreal. So now, from 9:30 a.m. to 11:30 or noon, a program out of Montreal is broadcast, and we no longer hear anything about us. So that is what I mean about budget cuts. They always take place to the detriment of communities or francophones or provinces outside of Quebec.

[English]

Senator Unger: Thank you all for your presentations.

My first question is for Mr. Godin. You stated that CBC does not help to build our Acadian identity in New Brunswick. I'm wondering if that's really a part of CBC's mandate, to build identities, specific identities.

[Translation]

Mr. Godin: I personally make quite a distinction between CBC and Radio-Canada; Radio-Canada provides French content and helps us to build an identity. When, as French-speakers, we do not see ourselves or hear ourselves reflected, it is as though we did not exist. So to my mind, if there are networks for Canadian English-speakers, I think, though I am not an anglophone, that they probably strengthen the Canadian identity of anglophones. On the francophone side, Radio-Canada should do the same thing for all French-speaking Canadians in the country.

[English]

Senator Unger: Yes, but again the idea — and I'm from Alberta — is that if I listen to CBC or watch CBC television, in some way that's helping to build the identity of Western Canada. That thought had never occurred to me. To me CBC radio or television is to provide information. Regional news is simply not covered in the national news. We don't hear in the West anything about Acadian communities.

Years and years ago, Don Messer — I think though he was from P.E.I. — was a program that my family all watched. I knew it came from somewhere down East, that was really all I knew about it. There was nothing in particular that CBC did to promote Don Messer's program; Don Messer did that.

[Translation]

Mr. Godin: As a minority French-speaker in Canada, I think the importance of Radio-Canada is even greater than that of the CBC for anglophones. If we do not have Radio-Canada, where are we going to get our news, our programs in French? There will be no source whatsoever. Whereas on the English-speaking side — and I am not going to launch a big linguistic debate here — in every province there are provincial or regional English-language television networks. But if we do not have Radio-Canada, we have nothing. So, this means that francophones outside Quebec would have to listen only to radio and television in English, or listen to programs that come from France, which is not really to our advantage either.

[English]

Ms. Poirier: Can I just add something here? I think there has to be a distinction made. All of the francophone programs that come out of Montreal are Montreal-based, or American-based and translated. There are very few programs made of francophones or what we do or what we represent, in Radio-Canada's programming. There is a distinction to be made between the English programming, because they cover all of Canada. You know, you have, "Heartland" in the West and you have "Republic of Doyle" in Newfoundland. So those are culture-based, and those really do bring out the cultures of the different regions, no matter what. We don't have that at Radio-Canada because everything comes out of Montreal. I don't associate with the Montreal culture. It's not my culture. So there is a difference. I just wanted to add that.

Senator Unger: Thank you for that clarification.

You talked a lot about cuts, especially Ms. Rioux. Do you think the problems that you and your colleagues have stated that you have with Radio-Canada and/or CBC would be solved with more money? Is money the answer or is it something else?

[Translation]

Ms. Rioux: When I was at the Fédération des parents in 1996, I submitted a brief about Radio-Canada to the CRTC in which I deplored the lack of coverage of current events in Nova Scotia, as compared to New Brunswick and Montreal. Because of that, we feel doubly in the minority. That was in 1996. That was a long time ago. In the meantime, there have been more cuts, but I am convinced — you know, we have an extraordinary team of journalists in Nova Scotia — that it would not cost any more to give them more air time that is given, for instance, to New Brunswick or Montreal currently. I also agree with my colleagues when they say that we are perfectly capable, for instance, of having a conversation with a taxi driver in Montreal and talk about current events in Montreal when we are there; we can talk about problems regarding the Champlain Bridge, the Charbonneau Commission and so on, and anything else you would like, whereas the reverse is not true. So, when you were asking earlier, Madam Senator, if that is a part of Radio-Canada's mandate, the answer is yes. Radio-Canada's mandate is to reflect all of Canadian reality, taking into account the country's regional diversity and the particular needs of the regions. What we say is that our particular needs are not taken into account, and that has nothing to do with funding. It has nothing to do with the cuts; even if there were an increase in the funding, it would have nothing to do with that. As I was saying earlier, it is about how the funds are allocated and about the upper management decisions at Radio-Canada, who decides what is allocated to whom, where people are assigned, and how news is going to be handled.

[English]

Senator Cordy: I want to reiterate what the chair said earlier about the importance of the Senate having meetings in the region because we certainly get a different perspective of Radio-Canada from Atlantic Canadians than we would in Ottawa or in Montreal.

Thank you very much for your presentations. I'm a Nova Scotian senator, so I particularly want to thank you for being here today.

We heard a lot about the importance of having Radio-Canada, having a national francophone broadcaster, but in your presentations you also talked about the challenges that you are facing particularly in Atlantic Canada in terms of there truly being a national perspective on news that is being carried on Radio-Canada. What I'd like to know is do the Acadian Federations of Atlantic Canada have a communication or relationship with Radio-Canada in terms of what is being broadcast?

[Translation]

Ms. Rioux: Yes, we do. We have regular and very cordial meetings with the management of Radio-Canada Atlantic. That said, those managers are nevertheless at the mercy of Radio-Canada management in Montreal, and must essentially do what they are told to do; that is their mandate. So, we know that the Atlantic people listen to us attentively, we know that they understand our issues, challenges and needs. We know that they understand very well that Nova Scotia, for example, would like to have more coverage, and we have already made the suggestion that there be more work done with community radio stations there to make up for the lack of journalists in the Acadian regions. That could be one solution. But between the suggestions, the attentive ear we are given and what happens in the final analysis, there is a gap, unfortunately; we do not always see the results we would like to see, and are still waiting to see.

As I was saying in conclusion, I have easily made four or five presentations before senatorial committees or before the CRTC, where I have talked about Radio-Canada, and there are still no changes. But it is not ill will from the Atlantic side. I want that to be perfectly clear. I think the ill will, and I characterize it that way, comes from Montreal.

Mr. Godin: I agree with my colleague, and I think that there is a will in Atlantic Canada to offer better service, but that service comes from Montreal. There are programs that have been taken out of Atlantic programming and are now coming out of Montreal, and they tell us that those programs are just as good. Well, I am sorry, but we had an RDI program that was broadcast from 11:00 a.m. to noon, from the Atlantic region, on the continuous new channel, and now it comes from Montreal. Unfortunately, personally I no longer listen to it, because now Acadia may be mentioned for 30 seconds in an hour, whereas before we had one hour of programming that was produced right here in the Atlantic region. So those are some examples. There have been cuts for 20 or 30 years, and we try not to be weary, but we are tired of saying the same thing over and over again. We are against the cuts. If the federal government wants to reinvest in CBC/Radio-Canada, let me add a codicil: yes, but in the regions, not in Montreal and Toronto. We have been saying that for 20, 30 and perhaps even 40 years. I hope I do not make it to 40 years of repeating the same thing, because I will be very old.

Ms. Rioux: With your permission, Mr. Chair, I would also like to give an example. You know, things are quite difficult in Nova Scotia, and perhaps I can bridge your two interventions. It is somewhat difficult in Nova Scotia to encourage Acadians there to listen to Radio-Canada Acadie, because they do not see themselves there, they do not hear themselves. So how can we encourage our Acadians and our Nova Scotia francophones to listen to public radio and television, if the broadcaster never has a word to say about us?

Mr. Godin: Occasionally, I watch The National and I recognize Canada. When I watch Radio-Canada's "Téléjournal," I do not recognize Canada, I recognize Montreal. And as my colleague was saying, if I take a taxi in Montreal, I can discuss things with the taxi driver, and I probably know more about Montreal than that driver. However, I do not see any Quebecers coming to Bathurst, to my region, and discussing what is going on politically in New Brunswick with me, in the Atlantic region, in the Maritimes, as they know absolutely nothing, because they are never even shown that that part of the country exists.

Ms. Rioux: In fact, if I could make one last comment, I would also like to say that the perception we have, and I do not know if it is just a perception or reality — but it is also mentioned in Ms. Pedneault's book — the perception we have, is that Radio-Canada Montreal has no interest in covering the francophone regions in the eastern part of Canada, because that would show that we francophones are still alive and kicking. Whereas for Radio-Canada Montreal the message is often clear — there are often clear separatist messages there, and we know that the message the separatists do not want to hear is that we are doing quite well, we are surviving and developing. That is not discussed at Radio-Canada because it is not in line with that interest. That is the perception we have and that is also the perception Ms. Pedneault mentions in her book.

[English]

Senator Cordy: Thank you very much. Certainly those were very in-depth answers to the questions and I appreciate that.

Madam Rioux, I think you said in your comments that you actually put forth a proposal to the Official Languages Commissioner. Now, the Official Languages Commissioner would look at whether or not there was French broadcasting throughout the country, but would he in fact look at the content of that broadcasting?

[Translation]

Ms. Rioux: I do not understand, senator.

[English]

The Chair: I can clarify. She talked about the Official Languages Senate Committee.

Senator Cordy: Sorry, I thought she meant the Official Languages Commission.

Would the Official Languages Commissioner look simply at whether or not there was French broadcasting across the country, or would he in fact look at whether or not the content of that broadcast was reflective of the country? Would you know the answer to that?

[Translation]

Ms. Rioux: I am a jurist, not an attorney, but from what I understand, it seems to me that Radio-Canada had challenged the power of the official languages commissioner in connection with the CRTC and Radio-Canada's obligations, and that this matter had been settled before the courts, if memory serves. This was about the commissioner possibly intervening with the CRTC on issues involving Radio-Canada. I may be mistaken, but we also know that we have an ally in the Commissioner of Official Languages, that much is clear.

[English]

Senator Cordy: Thank you.

The Chair: Final question?

Senator Greene: Yes, thank you very much.

I really do understand your problem. You've explained it very well. How would you fix it? Is it necessary for Radio-Canada, for example, to open a satellite office in Moncton or Halifax or something like that?

[Translation]

Ms. Rioux: No, you will not go first! You will be happy with my answer in any case.

I believe Ms. Marie-Linda Lord, who is very well known, has suggested that the headquarters be moved from Montreal to Ottawa. The suggestion is not stupid at all. I would like to say that it would be even better if it were moved to Moncton, because that is the centre of the Acadian community. I sincerely believe that when the majority of employees come from one region. . . and this is not necessarily their fault, but when you are not exposed to the reality in other regions, you develop a centrist perspective; you develop a feeling, an approach that means that you have blinders on and do not see what is happening elsewhere. So I think that the problem, really, at Radio-Canada is the fact that the vast majority of employees work in Montreal.

Mr. Godin: I am sure that even if they had more funds, the regions would not be any better off and perhaps they would be less better off, because there would be more concentration in Montreal than elsewhere. I think that Radio-Canada could do a better job, and as I said, comparisons are always odious. As a Canadian, I think that the CBC provides better pan-Canadian coverage than Radio-Canada Montreal, and I find this deplorable and it saddens me. When I listen to "The National" I know what is going on in Canada; when I listen to Radio-Canada, I know what is going on in Montreal. This saddens me, and in fact it gives me chills.

The Chair: I thank all of you very much for your presentations; they justify our presence here.

[English]

I would now like to welcome our next panel of witnesses. We have in front of us Mr. Ross Ingram, Owner and Manager of CJRI Radio and from Tell Tale Productions, Edward Peill. Who is first? You've been here longer so we'll give you the priority.

Ross Ingram, Owner and Manager, CJRI Radio: Thank you Mr. Chairman.

A Pollara poll in 2009 concluded that 83 per cent of those polled believe that the CBC is important in protecting Canadian identity and culture; 81 per cent believe that the CBC is one of the things that helps distinguish us here in Canada from the United States. The raison d'etre for the CBC has changed completely, though, over the years. The organization itself I feel is caught in a 1960s time warp. When the CBC was established in the 1930s it was a broadcasting necessity to link this big country together. In those days radio stations on a network were physically linked with rented lines from telephone companies. Only government could afford the huge annual expense of rented lines from coast to coast. In the case of television in the 1950s the cost of a microwave network from coast to coast was a large expense. Both of those expenses are gone. In the Twenty-first century it's possible for an organization or an individual to send their programming to a satellite channel to create a network feed for either radio or television.

The basic mandate of the CBC, without getting into the fine print, has always been to tell Canadian stories to Canadians to reflect a distinctly Canadian culture. In my early CBC days — I worked for them for about 30 years — I travelled thousands of miles talking to ordinary Canadians for the CBC national network. CBC had a whole department called Outside Broadcasts. Now hardly anyone does that anymore for radio or television, brief clips perhaps on newscasts and the odd documentary. There is no argument about the need or the mandate of the CBC but there are many ways the delivery of that mandate can be improved.

I am as old as the CBC. We began in the same year when the CRBC was formed. I've been privileged to watch the broadcast industry in this country grow, as part of it, for the last 60 years on the inside in private radio and television and for almost 30 years with the CBC. I have what is best described as a love-hate relationship with the corporation. I love it for what it could be and I despair at times when I look at what it is. Canada simply can't afford the CBC as it now stands.

Some necessary changes with the objective of streamlining and cost cutting: In my opinion in this day and age, the CBC needs to get out of the local radio and television news business and out of local programming. The listening public has an almost unlimited choice of alternatives to receive up-to-the-minute local news from privately owned radio and television and from the Internet. The CBC must focus on being a truly national service. One newsroom in each of the provinces could serve both radio and television. A duplicate French language newsroom would be required in the provinces of Quebec, New Brunswick and Manitoba. The output of those newsrooms would be provided to one national production center, Toronto, for English language radio and television, Montreal for the French language and transmitted country-wide to satellite and cable. For television it would essentially be an enhanced CBC News/world. I'm speaking of a national organization; no more regional layers, no transmitters, all programs delivered by satellite and/or cable and that, by the way, is already being done.

No off-air transmitters should be in operation for any of the 27 TV stations operated by the CBC. Keeping a television transmitter on the air, whether it's digital or analog, is an expensive business. Now this works in New Brunswick. All on-air transmitters for CBC in New Brunswick have been shut down. Television programming is delivered by satellite and cable.

The 82 radio stations operated by the CBC should be supplied programming from the national program centers which would receive programming contributions from each provincial capital. There are no 24-hour live radio networks operated by private radio in this country. CBC radio news on the hour could be made available for sponsorship. It could also be provided to radio stations on request, such as smaller community radio stations across the country. CBC Radio could survive as a 24-hour news service along the lines of the present television service called CBC News/world, a radio version of that. In my opinion the CBC FM network is superfluous. The corporation should eliminate the cost of broadcasting what is largely music that is already available from many other sources.

The market would be left wide open for production houses to provide specific programs of all types for the corporation. In other words, television productions would be carried by, rather than produced by, the CBC. There would be market opportunities for present CBC programmers to branch out by forming production companies and developing programming which would be sold to CBC and perhaps beyond.

Online streaming radio services have replaced the CBC short wave service in much of the world. They serve a very useful purpose. They should be retained. The services provided by CBC in eight indigenous languages should also continue unchanged.

Now to make these changes efficiently, the CBC must start hiring experienced broadcasters and promoting from within. Broadcasting is a business of personalities, not programs. The CBC is program-oriented with on-air staff as a secondary consideration. CBC must consider one's proven talent and experience in broadcasting in hiring on-air staff since the broadcast industry in Canada has developed to the point where there's a rich pool of such people available. On the other hand, CBC technical staff are hired for knowledge and the experience and to putting that knowledge into practice. As a result, the corporation has some of the best technical broadcast minds in the country.

I want to stress here that I don't have any vested interest in Bell Media but I'd like to point out that, as a broadcast organization, in my opinion, CTV is leading the way in Canada these days. It provides a television service across Canada much cheaper than does CBC. It has fewer people on staff and a larger audience. Their viewing audience for the Maritimes — and I'm speaking of one particular program, the weekday evening newscast here in the Maritimes — and the rating for that program has consistently been the highest of any such newscast in Canada. Looking into it, the reason is that CTV hires experienced broadcasters who are proven communicators. I worked for CBC for 30 years and I'm still not sure of the CBC hiring requirements. Some strange choices are sometimes made. Successful broadcasters, successful communicators are developed, not anointed.

The changes I'm suggesting here constitute a broad brush approach. They would, of course, result in vast changes at CBC headquarters, changes from the top down: CBC headquarters, the origination point for such incredible flights of fancy as iPods and electronic devices replacing CBC Radio, and the more recent observation that Canadians are willing to pay more for the CBC.

I'd like to add here that the CBC, in human terms, is obese and I think the message is basically get thin or die. In summary, if the CBC is to be preserved, it needs to be streamlined and re-organized from top to bottom.

Thank you Mr. Chairman.

The Chair: Thank you.

Mr. Peill?

Edward Peill, President, Tell Tale Productions Inc.: First of all, I'd like to welcome members of the committee to Halifax and to thank you for the opportunity to share my thoughts at this hearing.

Before I get started, I wanted to mention that I'm a member of the Canadian Media Producers' Association, or CMPA, and our CEO, Michael Hennessey, appeared before this committee on January 29 of this year. I won't be covering the same ground as Mr. Hennessey, but rather I'd like to share my perspective as a TV and digital media producer based here in Nova Scotia.

I also wanted to state for the record that I have produced numerous documentaries for the CBC during the past decade including one currently in production entitled "TV Revolution," which explores the history, cultural influence and future of TV in Canada.

From man's first step on the moon to the Beatles' first steps in American and from the fall of the Berlin wall to the fall of the Twin Towers, television has influenced the way we look at the world and each other more than any other medium in history. TV has been the driving force behind the biggest social shifts of the past half century including the feminist movement, racial equality, same sex marriage, the environmental movement and multiculturalism. It has broadened the world view for people in the furthest corners of the planet and given a voice to those who most need to be heard.

When the first Canadian television broadcast started in 1952, nobody could have imagined the massive impact the flickering box in the corner would eventually have on all of us. TV has impacted every aspect of our daily lives from our dating habits to our bedtime rituals, to where we go on vacation. It influences how we talk, our sense of humour, and even the names we give our children. It can fuel our hunger for knowledge, increase our understanding of the world, and motivate us to become better citizens. Perhaps most importantly, TV has played a leading role in shaping our national identity and helping us unite Canada from coast to coast to coast.

Since its humble black and white beginnings more than six decades ago, TV has continually had to re-invent itself as technology evolved. The growth of satellite and cable television in the 1980s and 1990s created dozens of new channels and fostered an explosion of new content. The emergence of HD technology in the 2000s created demand for still more channels and Canadian content flourished, both here at home and abroad.

The rise of the Internet during the past decade has led many critics to proclaim the end of the Canadian television industry as we know it. In fact, they're absolutely right. What we now refer to as television will never be the same again.

In today's increasingly tech-savvy world, consumers are continually being bombarded by a dazzling array of new products and services that promise to change our lives for the better. But just as the introduction of email failed to reduce the amount of paper we use for printing, new technologies can have unexpected consequences.

Cellphones have replaced land lines but we now talk on the phone more than ever. MP3 files wiped out audio CDs but we now listen to more music than ever. Blogs decimated the sale of newspapers but we now read more than ever. As each new technology emerges, making it easier and more convenient for us to consume, that's exactly what we do. We increase our consumption.

The same pattern is emerging with TV. You may choose to watch the latest clip from "This Hour Has 22 Minutes" via Facebook on Wednesday morning rather than during the broadcast Tuesday night. But the often-overlooked reality is that you didn't stop watching TV due to the Internet. You ended up watching TV because of the Internet.

The average Canadian will watch more than 100,000 hours of television during their life. That equates to 12 years, 24 hours a day, seven days a week of non-stop viewing. That's actually more time than most people will spend at work during their entire lifetime.

According to rating agency BBM, Canadians watch an average of 25 hours of online video content per week in 2013 as compared to 30 hours of traditional TV. But over the next few years, as Internet-ready or "smart TVs" become the norm in Canadian homes, the distinction between traditional TV and online video content will gradually disappear altogether.

As the business of screen-based entertainment evolves from a one way conversation with a captive audience to an interactive exchange with the entire world, it's quite likely that some Canadian TV channels won't survive that transition. The channels that will be at greatest risk will be those that have depended most heavily on American content. Ironically perhaps, the one thing that may ensure their survival is that which they have fought hardest against, programming Canadian content.

In the new digital world order American content creators will seek a direct relationship with Canadian viewers, so the role of Canadian broadcaster as middleman will eventually disappear. Netflix kick started this trend several years ago and last week HBO announced it will start offering an online only service in 2015.

Here in Canada Bell Media is developing a standalone online services while Rogers and Shaw have combined forces to create Shomi which will be launched this fall. They've announced that, unlike Netflix, 30 per cent of their 11,000 hours of content will be Canadian. Interestingly a large part of that content will be licensed from the CBC.

As the on-demand, binge-watching, anywhere, anytime digital reality becomes the norm, what does this mean for the future of the CBC? The answer, in my opinion, depends on three key factors: how quickly and efficiently the CBC can respond to the changing technology; the level of ongoing financial support the CBC receives from government; and the regulatory framework the CRTC creates with regard to digital-only or over-the-top services.

I personally believe the CBC is better positioned to survive this digital content tsunami than most commercial broadcasters since they're already focused on the one thing that American competitors will most likely never offer, Canadian content.

But having unique content that speaks to Canadians will only be half of the battle. The other part of the challenge will be how quickly CBC can shift away from the current business model of releasing one new episode per week for several months and transition to the Netflix model of releasing an entire series all at once.

This concept terrifies broadcasters because generating weekly ratings and pre-selling TV commercials for an entire season is the bedrock of their revenue model. But just as Blockbuster Video went bankrupt because they weren't willing to risk their bricks and mortar locations to compete online against Netflix, CBC will need to take certain risks to compete in the new digital world.

As the public broadcaster, CBC should be supported and encouraged to take the creative risks the commercial broadcasters shy away from. Their success, however, will depend on one key ingredient, the level of long-term, stable government funding.

At present CBC receives approximately $1billion of government funding each year. This amount sounds impressive until one compares it with the funding received by public broadcasters in other western countries. According to the 2013 Nordicity report, the CBC receives $33 per capita of government funding while the BBC receives three times that amount at $97 per capita. And funding doesn't seem to be based on population since all of the Scandinavian countries receive in excess of $100 per capita per year.

But one could easily argue that some of the most engaging content these days isn't coming from public broadcasters but rather from Netflix, HBO, Showtime, AMC. But while it's true that these companies produce water cooler TV shows, the reason they can out-compete their commercial rivals comes down to one main factor, subscription revenue.

Traditional broadcasters obsess over generating high ratings, selling TV commercials to the highest bidder and trying not to offend their advertisers. Subscription-based content providers, on the other hand, don't worry about day-to-day ratings, selling commercials or offending advertisers. They don't have any. They focus on creating content that resonates with their customers in providing good value for their monthly fees. This financial freedom allows them to take creative risks, and the award-winning results speak for themselves.

The final element that will influence the success of the CBC and all Canadian broadcasters over the coming years will be the regulations implemented by the CRTC with regard to the OTT, or over-the-top services. Not surprisingly, digital players like Netflix and Google have said they'd prefer not to be subjected to any Canadian regulations whatsoever and, while this may keep their shareholders happy, it gives them an unfair competitive advantage against Canadian broadcasters which are required to contribute to the creation of Canadian content.

Requiring these digital players to contribute to the Canadian broadcast system will not only level the playing field, it will encourage continued investment in the Canadian TV sector, maintain thousands of jobs and allow us to continue to share Canadian stories with future generations.

Thank you.

The Chair: Senator Plett?

Senator Plett: Thank you, gentlemen. Those were interesting presentations.

I appreciate the entirely different perspective, Mr. Ingram — different than what we've heard in the past.

Both of you have talked about competitive advantages and subsidies and so on and so forth. I've got a number of questions around those areas.

Mr. Peill, you've talked about other countries and the subsidies that they get. You've talked about competitive advantages. You say that Netflix is not offering Canadian content, so that gives them a competitive advantage. Does CBC not have a competitive advantage when they get $1 billion worth of funding and then are allowed to compete with CTV and Global for advertising when they are already getting these subsidies? Does that seem like a fair solution? I suspect the answers might be a little different from the two of you, so I would like both of you to answer the question.

Mr. Ingram: Yes, a definite competitive advantage when you don't have to go out and fight for every dollar in the marketplace.

Mr. Peill: There are different realities at play with CBC as compared to the other commercial broadcasters. First of all they have a mandate to fulfil that the commercial broadcasters don't. They broadcast, I believe, in six or seven different languages. They cover territories that commercial broadcasters don't. I mean they have a huge amount of responsibilities. Commercial broadcasters can simply go for the highest return on investment programming and that is how they program. If you look at the weekly schedule for CTV and Global, I think you'll see that in prime time 80 to sometimes 90 per cent of their content is American shows which they buy very cheaply — or cheaper than producing original content — re-broadcast and take in those advertising dollars.

The CBC, on the other hand, if you look at their schedule, 90 per cent, sometimes more, sometimes it's 100 per cent of prime time is Canadian content. Creating original content is more expensive than buying off-the-shelf content from the United States but that is part of CBC's mandate.

Senator Plett: Let me talk a little bit about that mandate and the content. We were told by some union representatives a week or two ago that we should increase our subsidy from, I think you said it was $33 to $42 I think was the number. And that was compared to buying a case of beer. Of course, I don't know many people who go out and buy a case of beer in order for it just to stand on the shelf. They buy a case of beer because they want to have a bottle of beer. So I don't think it's a fair comparison because I am being asked to pay $42 to subsidize a television producer or a television show that I'm not watching. I don't want to give away things here, but I'm almost 65 years old and at my age I watch television, hopefully not the amount of hours that you suggested but maybe I do. I have a PVR. I have Netflix. So I watch my shows that are either pre-recorded — and some of them are Canadian content; I watch "Dragons' Den" — television shows or I watch Netflix. Both of those I watch basically without commercials because I fast-forward through the commercials. I watch sports and I watch news. Now at 65 years of age I have this technology. Imagine what my kids and grandkids have. So where does CBC possibly keep up unless we do something along the lines of what Mr. Ingram was suggesting? How does CBC keep up with the times in that regard? Now, I understand what you're saying, they need to keep up with the times and they've got to keep up with this and they've got to keep up with all the other things. But they're doing it at the cost of taxpayers' dollars where as CTV is having to do exactly the same thing without taxpayers' dollars, so tell me how you square that box.

Mr. Ingram: What I've been talking about here is paring the CBC down staff-wise to something along the lines of the other operators like CTV and Global. CBC has always been, in my estimation, and I'm going back to 1956, the Judy LaMarsh days that perhaps some of us over 65 will remember, and it was said then that the CBC was top-heavy, the office in Ottawa. She suggested, it seems to me, it could have run with one third the people there.

An example is what has happened in Fredericton. CBC built a very expensive building there, I think close to $1 million back in 1967 or 1968, and there were 40 people there for radio and TV. We were sending programs to a radio station in Fredericton and one in Saint John that CBC owned and operated. Later on CBC Television came along and we were producing basically half of a program for New Brunswick. Everybody on that staff was employed fully. The CBC in New Brunswick, and not of their own choosing, I think has led the way in paring down, what I was talking about. They have 12 people there now in that building. Part of the building, part of the television operation is rented out to St. Thomas University journalism. The CBC has sold the building. They are now renting there. There are 12 people in there now doing what 40 people did in the 1960s. Now a lot of that, of course, has to do with digital improvement and everything but still it's still over-staffed.

Senator Plett: Do you notice the service —

Mr. Ingram: And people on the air don't notice a bit of difference.

Senator Plett: Mr. Peill?

Mr. Peill: I can't claim to be an expert on how the CBC should be running its internal affairs. That's really up to them to determine.

Senator Plett: Well is it? Is it when they get $1 billion worth of money?

Mr. Peill: Well, again, if you ask are you getting value for your money as a taxpayer? If you buy Netflix you pay over $100 a year. Is that good value for money? Here's the thing that we're —

Senator Plett: Well, I pay $8 a month so it's not quite, but anyway, close.

Mr. Peill: Well, it's $9 — it's triple what you're paying for CBC. I mean, this really is the question it comes back to, are you getting value for your money? Say you're watching CTV. Well, you're paying a cable bill. You know you're not only paying access to it, you're paying with your eyeballs. You are the product. You're being advertised to. I mean, there's always a price you pay. Years ago this constantly came out with music. Oh, we can get everything for free now. It's online. It doesn't cost anything. Well it does cost.

Let's use the example of a 16-year-old who lives on their iPhone. There are a lot of different references to people that are "cord cutters," cutting their cable cords. And there's another category called "cord nevers." These are people who, it is predicted, will never have a cable subscription. When you look at a graph, as you might expect, the "cord nevers" are the younger generation. Then that gradually changes and in the older the demographics are the ones typically having the cable subscriptions.

The reality is that they have this concept they're not paying, but they are. If you live on your cellphone and you watch 30 hours of content, you're going to be paying probably $100 a month in fees for your bandwidth, so there is no free lunch.

Trust me: The commercial entities out there will ensure that you are paying one way or the other, either through your Internet subscription, through your cable subscription, through your bandwidth that you pay on your phone. All of these things cost money. The average Canadian spends over $100 a month on cable fees — again, that's $100 a month. So that's $1,200 a year in cable fees and the CBC is $33 a year, which is pretty good value for money, I would say.

Senator Plett: Let me pick up on that thought, Mr. Peill. Because as I said with the case of beer, yes, I pay $96 a year for my Netflix but I do it because I want to do it. Number one, of course, it includes my whole family. I can put it on three devices so I mean of course it's not —

Mr. Peill: Your case of beer you mean?

Senator Plett: Ninety-six dollars a year.

Mr. Peill: Oh, for Netflix, sorry.

Senator Plett: Netflix. I pay $7.99 a month for Netflix. I can put it on three devices. My whole family can watch it, so of course it's not costing all of us that. When we talk about the subsidy it's costing every Canadian that money. I can watch what I want. I can choose the movie I want. I don't know what it cost to go to the corner store and rent a DVD or a movie, because we don't do it anymore because of what we have. I don't think you can compare what you're paying for Netflix or what you're paying on your iPhone because you're doing it because you want to do it. We all spend money. With the CBC I have to pay whether or not I watch it.

Mr. Peill: But you do watch though. That's the thing.

Senator Plett: Yes.

Mr. Peill: You are a consumer.

Senator Plett: I'm a consumer, absolutely.

We heard from the witnesses before you, and I know Mr. Ingram was listening, and we have heard over and over and over again that CBC, Radio-Canada are in Montreal and Toronto and of course you've shared, Mr. Peill, that they have to go into areas — and of course they do go into areas where nobody else goes. I understand that and appreciate that and that, of course, was one of the big reasons why CBC was out there. I think you both would agree, though, that maybe they should start doing some cuts. Instead of doing them in Fredericton, maybe they should start doing some in Toronto and Montreal and maybe the general public might be a little happier. I think it was you, Mr. Ingram, who compared CTV doing the same job as CBC at a considerably lower cost. Do you have some numbers that you could share with us on what the costs are?

Mr. Ingram: I don't have numbers but I do have instances; recently for example — I wasn't involved in this one — Princess Diana's funeral.

Over the years, I talked with Robert Hearst who was head of CTV News at the time. We'd talk back and forth about the business. At Princess Diana's funeral, 23 people went over there from CBC and 4 people from CTV, and the coverage was comparable. As to money figures, no, I don't.

Senator Plett: On that note, if CBC is asked where in the airplane did you sit should they have to give us the answer and should they have to give us the answer on salaries and so on and so forth? Should they be transparent in the costs? This is a question we asked about the Olympics, and we didn't get an answer because we were actually told by the president that he didn't know what their travel policy was. I found that rather strange that the president wouldn't know what the travel policy of CBC is. But what's your feeling, both of you, on transparency issues? How transparent should a public broadcaster be?

Mr. Peill: Maybe I can just answer that and your earlier question as well. Just something you mentioned, that you don't have a choice of whether to consume the CBC or not. I would argue the same applies when I pay my monthly cable bill. I have a basic cable package and a few of the specialty packages. I probably have 120 channels.

Senator Plett: Which of course our government is trying to work on.

Mr. Peill: Right, but the point is that I watch 15 of those channels. I don't watch the golf channel. I mean there are so many channels. The majority, 90 per cent of the channels I pay for, I don't watch but I don't have a choice. Now if you say, well, why should one do that, and I know the CRTC is looking at creating a-la-carte pick and pay system. The reality, just as with other industries, is that that model supports all the content that's created. Just as you walk into a grocery store and you don't buy every item, you buy the items that you choose, you know there needs to be a certain economies of scale to make the whole system work. So you might argue the same thing with CBC. That's part of what you're paying for You probably don't watch or listen to CBC in the Northwest Territories but for those people that's a pretty vital service. I've travelled, as I'm sure everyone here has, to different corners of the country, and the service that CBC provides is vital to them feeling connected and a part of this country. And the commercials aren't there.

Senator Plett: Tell me about transparency.

Mr. Peill: Transparency is a politically loaded topic. The question I would ask is, "Does the same rule apply for every government department in every agency?" I mean if every single agency in the government has to share the salaries of all of its employees, then I suppose CBC should as well. I'm not sure if that's the case, not my area of expertise, but I mean that's something, I think, that the board of the CBC, as with every type of government agency, has certain rules in place and the salaries I'm sure are commensurate. As a matter of fact, my understanding is the salaries of the executives at CBC are probably much less than of the commercial rivals.

Senator Plett: But we would still like to know what they are, and I don't disagree with you.

Mr. Peill: I guess that's a political question and if it applies to every other government agency out there, I'm not sure if it does. The head of National Defence, is his salary published?

Senator Plett: Yes.

Mr. Peill: Again, I guess that's really a government question.

Senator Cordy: Thank you very much, witnesses, for being here this morning.

Mr. Ingram, when you were speaking in your opening remarks you said that CBC has to get out of local programming, yet we just heard witnesses talk about the need for local programming for the francophone community or the Acadian community in Atlantic Canada. How would you differentiate there, or did you disagree with their comments?

Mr. Ingram: I'm talking about strictly local programming like local morning programs and local news. I'm getting back to the Fredericton example where we had I think about 15 radio stations available on the radio, and CBC news, for instance, can't compete with them because there are too many people out there. What I am suggesting is that the CBC becomes a truly national organization.

The same thing goes for Radio-Canada, that they become a national organization with national production centers, Toronto and Montreal, satellite-fed to all of the country. For instance the lady was talking about I think Corner Brook and Newfoundland. Corner Brook and Newfoundland would have a news person there and if not a CBC employee, there are all sorts of freelance people out there. I was interested in what she said about schools. She said where there is a significant French-language community, a francophone community, there is a school. Now, it is a very simple and inexpensive thing, and I'm sure the CBC could find it somewhere in their budget, to put a 10-watt transmitter on top of that school, which would cover the whole area and wouldn't even need CRTC approval. You just have to find the frequency, the technical people and put it on the air.

So two things there: There would be news coverage out of Corner Brook and the francophone community in Corner Brook would be able to hear the programming. A lot of the things that they mentioned, other than the centralization or the programming in Montreal, are very easily taken care of and very cheaply taken care of, by the way.

Senator Cordy: So you wouldn't see that being a problem, for example, in terms of a francophone Canadian saying that there news is coming from Montreal with a Montreal slant on it. Those in English-speaking Canada would say that it is coming from Toronto with a Toronto slant on it. You wouldn't see that would be a concern?

Mr. Ingram: There would not be a local studio in Corner Brook, for instance; rather news out of Corner Brook would take its place, in order of importance, with news stories — as opposed to being all Montreal or all New Brunswick — in the newscasts out of Montreal or out of Moncton, which would make much more sense for the Acadian community.

Senator Cordy: Mr. Peill, I thought your comment that we watch TV because of the Internet was quite interesting because I will often get links to TV shows that I have not had the time to watch and will click on them in the early evening or at some time during the day. I thought that was really a good comment.

I'd like to talk to you about your comments about the future for CBC and how quickly it can adapt given an important level of financial support and regulatory process. Regulatory processes seem to take forever to change in Canada whether it's broadcasting or whatever.

In fact, I think a lot of us watched when Netflix was in front of the CRTC. At that point I actually read a number of articles saying, "Is the CRTC passé? Should we do away with the CRTC?" It was interesting reading. It's sort of like what do you mean, do away with it? I'm not sure if you want to get into that area at all about CRTC, how quickly it should allow changes to regulations to be made for broadcasting in Canada, and is there a need for the CRTC in Canada? I know you spoke specifically about Canadian content in your presentation.

Mr. Peill: I think the answer to that is a resounding yes, arguably even more so now than perhaps in the past. Let me give an example of some of the benefits the CRTC has generated.

Thirty years ago the Canadian radio landscape, the music landscape was I guess what you would call barren of Canadian content. They brought in rules stipulating that broadcasters, public and private, had to program a certain amount of Canadian content. I think it was 30 per cent during the daytime. All of the broadcasters or the radio stations — their hue and cry — said, "This is going to be the end of us. You're forcing us to do something we shouldn't have to do," et cetera, et cetera. Well, 30 years later and that walled garden, if you will, allowed for the creation of the Canadian music industry. I don't think anyone would have predicted the success that it's gone on to have. It gave shelf space to those Canadian artists competing against American content. Canada is in a unique position more so than any other country in the world. We live next door to the biggest creator in the world of content in all forms of entertainment and with the same language. Mexico doesn't have that problem. Europe doesn't have that problem. So if we care about actually hearing our own stories, hearing our own music, connecting with ourselves and not just simply becoming the fifty-third state, which as a Canadian, I care dearly about it, then these things are important.

To give you an example of what happens when you don't have that regulation, you don't need to look any further than the film industry. Here's a little anecdote I'll share with you.

We just completed a feature documentary called "Santa Quest." It follows actor John Dunsworth who goes travelling around the world searching for the true meaning of Santa, representing Canada at the Santa Winter Games in Sweden, and it's a really heartwarming story.

Now, the funding came through various broadcasters and agencies, but we have a window to do a theatrical release this Christmas. I was talking with my distributor the other day and said, "So what are our chances of getting it into Cineplex?" By the way, we've already received huge media exposure, thousands of people wanting to know more about it online. His response was, "Here is the problem. You might, if you're lucky, get a half dozen screens."

I knew this was going to be an issue. We started a survey for the month of October. We already have over 6,000 people who voted to have the film come to their hometown and we expect to have double that amount by the end of the month. So with 12,000 people saying they want this film to come to their hometown, Cineplex's response to that, is, "Yes, you know we've got too many Hollywood shows." The reality is that they probably won't even watch the film before making that decision. I would ask you, of the 100 Canadian films, at least, feature films produced in this country every year, how many of them show up in cinemas? It's not because they aren't good films. It's simply that that's the no-holds barred, commercial-only model. There is one major exhibitor in this country. There are six US studios. They, amongst themselves, decide what we get to watch. Is that good or bad? I mean, I enjoy watching American movies as much as the next person but I would argue that if there was a quota system or some framework that just gave Canadian films a chance to flourish, the same thing would happen as with the music industry. So the shift to TV; thirty years ago when we created a lot of these new cable channels they brought in rules stipulating they had to have a certain amount of Canadian content. Thirty years ago again there was not very much in the way of Canadian programming apart from sports and news. There was the "The Littlest Hobo." There was "The Beachcombers." I mean there were a few sort of shows but most people, if you said what are Canadian TV shows, they'd say, "What do you mean?" They watched mostly American shows. That situation has completely changed.

The Chair: We're running out of time.

Mr. Peill: I'm sorry that I ran on. The point is today that half of all the content we watch in Canada are Canadian TV shows. I did a study a few years ago. Fifty per cent of all the content we watch is Canadian. That was not the case 30 years ago and that's because of CRTC rules. If those rules didn't exist, we wouldn't have that content.

Sorry for the long answer.

Senator Cordy: That's okay. I was around when the Canadian content rules were brought in and I remember the kerfuffle, but it has been incredible for the music industry and, I would agree, the film industry, which is far larger in Nova Scotia than people realize.

The Chair: I have a question about binge television. Everybody practices this now, with Netflix or whatever. Should CBC look at the concept of trying to see how they can get into that kind of new way of watching television?

Mr. Peill: As I mentioned, that's the challenge that all Canadian broadcasters are facing and it petrifies them. It directly goes to the heart of the business model. I mean, CBC should be allowed to take those risks. They should be encouraged to take the risks that the commercial broadcasters won't. And if they were to do that and lead the trail — I mean it's going to happen. If they don't make that switch, it will be the Blockbuster example. If you do not make that switch, you'll do so at your peril and your business will suffer because of it. That is the new way we're watching, myself included, and smart TVs will become the norm in Canada which is going to happen in the next three to four years. If you're not offering your content, at least as a parallel method to whatever you might be doing in a regular broadcast way, I don't think you're going to survive.

Mr. Ingram: I agree completely with Mr. Peill. The CBC, if it's going to continue to exist, has to keep up with the technological improvements over the years and has to do it as a leaner CBC.

Senator Unger: We talked a moment ago about the CRTC, whether or not they should continue to exist. Do you think the CBC's mandate should be changed? Do you think they're being hampered by their mandate?

Mr. Ingram: CBC's mandate, as I've always understood it, is basically to explain Canada to Canadians. That is their reason for existence. No, I don't think it should be changed.

Mr. Peill: Again if one believes in the concept of public broadcasting I'd say that CBC's role is even more important today, It's not just about Canadians sharing their stories with other Canadians. It is our face to more and more people around the world. I mean people can tune in and watch CBC from anywhere in the world and that's a fairly important role to play. Again with the unlimited commercial choices that we have now, more so than ever, having that public voice providing opinions that may not always be popular and simply not just doing what's commercially the most successful or going to generate the most revenue, I think is vitally important.

Senator Unger: Mr. Peill, you seem to be advocating that Canadians be force-fed programs because they're Canadian, and I think that people want to choose.

With regard to Netflix, I think they provide content that people want to watch. As a consumer I almost never watch CBC television. I'll listen to the radio in the background, but I really don't think that most of Canada, and maybe I should talk more for Western Canada, want to watch CBC. There are too many other choices and I think if people, and more and more are saying no to CBC. They have too many choices.

Mr. Peill: I would never suggest that anyone should be force-fed anything. I think what I would advocate very strongly for is that we have the choice, and taking the example I gave with regard to the cinema, if you don't have that choice available, what we'll consume will be mostly American content. And as far as people not watching CBC, I guess it depends on your measure of success. We do documentaries for "Doc Zone" and "The Nature of Things." The last three films we did for "Doc Zone" have all had over a million viewers within the first week. That's a lot of people. These were topics about counterfeiting, about leatherback turtles, a wide range of topics, but a million people watching that show both online on the main network and then a rebroadcast on CBC news network.

The problem is people are watching but we aren't aware of how much Canadian content people watch on the CBC and other channels. We tend to focus on, "Oh, that show got 3 million viewers; that American show got 2 million viewers." That's the tip of the iceberg. The vast majority of the content watched by Canadians every week is Canadian. It's 51 or 52 per cent.

The Chair: I have one last question from Senator Plett, and I believe you both have a final statement.

Senator Plett: In large part my question was answered by Mr. Peill in his last comment, but I do want to say this. The million viewers that you suggested had watched this particular program did so because they wanted to watch it, not because they had to watch it.

I don't know whether you're the same as me. Obviously because of these hearings I have asked people about CBC and what we should be doing. Very few people have suggested that CBC shouldn't be out there. I don't think that's the argument. But I just have not had a whole lot of people at all tell me that we need to keep CBC because we need to keep Canadian content. I believe that if Canadians produce good shows a million people want to watch, a million people will watch them.

I support entirely giving money because we need to be in some of the northern areas where nobody else goes. Everybody needs to have that right. They need to be able to hear about what's going on in the community. People in Resolute Bay want to know what's happening in Pond Inlet. They don't necessarily want to know what's happening in Toronto. So we need to make sure that they do that. I don't think anybody is arguing with that but, as Mr. Ingram says, one way of broadcasting obviously is to put the tower on the school or whatever and we can send a reporter around the North. We don't need to give CBC $1 billion for that. If you both want to make a very short comment on that comment, I'd appreciate it.

The Chair: And it would be your final statement.

Mr. Ingram: I will make it very short and to the point: CBC is worth maintaining and preserving, but it needs to be streamlined and reorganized from top to bottom if that is to occur.

Mr. Peill: Yes, in my mind there's no doubt that CBC fulfills a vital role to Canadians from coast to coast to coast. There is another aspect that is being left out of this conversation and that is that they provide a diversity of voices that the commercial broadcasters don't. I can speak to documentaries. The other commercial broadcasters have gotten out of the one-off documentary business for the most part. Is that good or bad? Well, if you care about hearing from people that live outside of Toronto and live in Alberta and B.C. and every other province in this country, I think that is important. They will do the things that don't bring the highest return to a group of shareholders. I think that is important because otherwise your choices will be limited. I mean, Cancon is often used as sort of a dirty word, but we all consume a lot of Canadian show and we don't even think about it. We don't think in terms of Cancon but if you care about diversity and keeping a robust broadcast system going then the CBC plays a very vital role in that.

The Chair: Mr. Peill and Mr. Ingram, thank you very much. We appreciate your presentations.

Senators, as our next panel of witnesses, we are pleased to welcome from the Canadian Broadcasting Corporation — Atlantic Canada, Denise Wilson and Richard Simoens.

Please proceed.

Denise Wilson, Senior Managing Director, Canadian Broadcasting Corporation — Atlantic Canada: Good afternoon, Mr. Chairman and senators. I would like to thank you, on behalf of my CBC colleagues here in Atlantic Canada, for inviting me to speak to you today on the challenges faced by the CBC in relation to the changing environment of broadcasting and communications and to talk to you specifically about this region.

Atlantic Canadians are served by 10 CBC stations in four provinces. Together we produce more than 300 hours of programming per week. Most of it happens in real time, across our platforms in a vast geographical area.

Our stations are vital to the communities we serve and CBC is committed to being in these locations. In fact, we believe this presence is the "front door" which connects Canadians to all that the CBC has to offer.

What brings people in this region to CBC are our people. Familiar faces and voices are there to provide our audiences with up-to-the-minute news and current affairs from their communities, about their communities, and provide stories about the people and places in which they live.

Six of nine morning shows in Atlantic Canada are number one in the markets. Our supper hour newscasts are either number one or number two in our markets and our online sites are consistently in the top five most viewed sites in the country. We are successful here and we're proud of that. However, we can't rest on our laurels.

Today there is also a whole new audience consuming our programming online and on digital platforms. Serving those changing audiences is what our new strategy, "A Space For Us All," is all about. It places particular emphasis on mobile first and how we deliver digital content.

If we are going to remain relevant as a broadcaster we must be providing them with the information they need, in a way that's accessible for them. At the same time, we have an ongoing commitment to people in this region who continue to rely on radio and television for their information.

As we move forward, our new strategy aims to maintain existing geographical presence and evolve the corporation's service by offering content specific to the needs in each region. Between now and 2020, CBC/Radio-Canada will provide a consistent core service for all the communities it serves, and it will accelerate the shift to digital and mobile, reflecting and anticipating the changing needs of our audiences.

Serving all of these audiences takes resources. We've been reducing our fixed costs. Our real estate footprints are smaller. Soon we will move from two locations here in Halifax where we now occupy 143,000 square feet over seven floors to a leased location of just 44,000 square feet. We are lowering our costs while maintaining our presence and our resources in our communities.

Finally, it's worth noting that the communities we serve are not simply our audiences. Throughout the year, CBC partners to support hundreds of events from emceeing business awards dinners to promoting literacy and participating in charity food drives during the holiday season.

Our holiday fundraising drives last year helped raise almost $1.3 million for people in this region. This is a powerful reminder of the generosity of the people in Atlantic Canada and the commitment of CBC to work with them to help communities in need.

I am proud of what CBC/Radio-Canada does for people in this region, and for the value our services have in their lives. As we implement our new strategy, strengthening that connection, in every corner of our region, is our priority.

Thank you for this opportunity. I will now hand over the floor to my colleague Richard Simoens and then we will welcome your questions.

[Translation]

Richard Simoens, Director of French Services - Acadie, Canadian Broadcasting Corporation: Mr. Chair, honourable senators, I thank you for this opportunity to come to speak to you today about Radio-Canada's presence in Acadia.

The hub of our operations is situated in Moncton, and we have regional stations in Halifax and Charlottetown, as well as seven journalistic bureaus across all of Atlantic Canada.

On radio, we produce three morning shows in Moncton, Halifax and Charlottetown. Three other daily programs, one in the morning, another at noon and a third for the drive home help us ensure a regional presence throughout the day. To top off our radio offering, we produce two regional shows airing Saturday mornings from 7:00 a.m. to noon.

On television, our suppertime newscast "Le Téléjournal Acadie" captures a 42 per cent share, according to the last BBM results. We also produce the talk show "Méchante soirée," which deals with current affairs and the arts. In all, we air a total of 75 hours of regional programming each week.

We also produce a substantial number of specials, variety programming, and documentaries. Two of our recent in-house documentaries were nominated for a Gémeaux award this past September. We also work closely with independent regional producers. As a point of interest, we are currently shooting a drama series called "Le Clan," that will be broadcast on the network soon.

This summer, Radio-Canada Acadie aired an exemplary array of programming across our three platforms during the World Acadian Congress. For the first time ever, the entire network prime-time schedule on August 15, Acadia's national day, was devoted to content produced in the region. The August 15 live show was carried across the country on ICI Radio-Canada Télé, and rebroadcast on ICI ARTV. A 90-minute version will also be airing in the coming months on TV5 MONDE.

For a number of years, Radio-Canada Acadie has had a dedicated team producing reports for the network programs "La semaine verte" and "Second Regard." We have a daily presence on RDI, and we also produce for RDI "Le national hebdo," a weekly recap of national news events. And a little over a year ago, we hired a national reporter mainly serving the 10 p.m. "Téléjournal," and the radio program "L'heure du monde."

As you may well expect, all of our journalists are required to contribute content to our Web page, and post on social media. As part of our strategic plan, "A Space for Us All," we have made it a priority to enhance our presence on digital platforms so we can be at the heart of Canadian conversations.

Radio-Canada Acadie is very present in its community via partnerships in all sectors, from the arts to business. We produce the "Gala des Éloizes," which promotes our homegrown artists on the national stage. We have partnered with the youth organization la Fédération des jeunes francophones du Nouveau-Brunswick since its inception on the Les Accros de la chanson contest. We work with the Frye Festival and the many book fairs across the region. Our partnership with the Dr. Georges-L.-Dumont Hospital Foundation last year helped raised $1.5 million for services to families of cancer patients. These are but a few of our community partnerships.

For the past two years we have enhanced our partnerships in the business sector to promote the presence, expertise and innovation of companies based in Atlantic Canada. Our partnership with the New Brunswick Innovation Foundation encourages young entrepreneurs to reach higher. The winner at the Gala Percée, for instance, is invited to pitch his or her project on' 'Dragons' Den" and "Dans l'œil du dragon."

Naturally, we maintain close relationships with community leaders and organizations by meeting regularly with them and taking part in their activities. Whenever possible, we meet with youth groups to get a better idea of their media consumption habits and better understand what they expect from their public broadcaster. Radio-Canada Acadie is at once a major journalistic force for the community and an invaluable partner in promoting Acadian culture and language.

Radio-Canada Acadie will be relocating its Moncton station next June. We will vacate our current 52,000-square-foot building and move to a new 21,000-square-foot leased facility. We have designed an open space, with no closed offices and open-plan studios. We are taking advantage of the move to review and transform all of our operations so we can become more efficient and make use of new technologies available to us. The new environment will foster greater collaboration between teams.

Along the same lines, I would like to point out the excellent cooperation we had with our CBC colleagues recently during the New Brunswick election campaign, both editorially and resource-wise. In addition, what began as occasional meetings between both management teams has become a true partnership between us. A CBC manager now attends our weekly management meeting, and we have a Radio-Canada manager at theirs.

In closing, I would simply like to say how proud I am to have served CBC/Radio-Canada for the past 38 years. Every day, I have been able to see how important Radio-Canada's presence has been in nurturing the development of francophone communities across the country. As a Franco-Manitoban, I can assure you that the public broadcaster has had an impact on me and my fellow citizens, in terms of helping us define a strong and proud cultural identity. Thank you for your attention, and we are ready to answer your questions.

[English]

The Chair: Thank you for your presentation. I would like to underline for committee members that we will be visiting the past location of CBC tomorrow morning in our visit.

Senator Plett, do you have a question?

Senator Plett: Thank you to both of you for being here.

I took some quick notes as you were going along, Ms. Wilson. You talked about 10 stations in four provinces. You talked about six shows that are either number one or number two in the market. Mr. Simoens, you talked with three morning shows, three daily shows, two regional shows on radio, 75 hours of regional programming each week.

We heard earlier today that Radio-Canada is a Montreal station, and we've heard in the past that CBC is a Toronto station. Your testimony doesn't bear that out. I would like you to comment on those comments by witnesses earlier today and in our studies that everything is centred around Toronto and/or Montreal.

[Translation]

Mr. Simoens: With your permission, I would like to say that we often hear about — I think that you have to see how Radio-Canada functions — the space we occupy in the territory. I think that Radio-Canada Acadie plays its role well in the region. I am not sure of what people said to you when they appeared here, but I would like to believe that they are generally satisfied with Radio-Canada's regional programming in Acadia. In my opinion, we offer programming that is there, that is accessible, that attempts to be as inclusive as possible and that attempts to present a picture both of the region and the whole of the country on current event topics that affect our area. I will not hide that I often hear those same comments or this same criticism, i.e. that Radio-Canada is too focused on Montreal. I think what needs to be said is that Montreal is a large metropolis, and clearly there is a demographic there that will not change easily. However, I want to assure you of one thing: we are very aware of that and we have made efforts, very big efforts in the past.

We are continuing our efforts to ensure that we have a presence that is what I would call more mainstream. This is a personal opinion: in the past, I often heard it said that we needed a certain quota and that we had to produce one, two or three regional programs that would discuss issues in the region so many times on the network. Now, we try to be much more inclusive in all of the programs we produce. For instance, if we talk about employment insurance, in a program produced in Montreal, we include guests from all the regions of the country in our network program. That is what was done, in fact, on the "24/60" program produced by RDI; we went around the Acadian peninsula to collect people's opinions on the quality of employment insurance, whether they were for it or against it. There were people from here, from Montreal, Toronto, Calgary and from all over. In short, we understand people's frustration regarding this vision, we are maintaining our efforts, but we are aware that there is still room for improvement.

[English]

Ms. Wilson: As I mentioned in my opening remarks, we do have a presence in 10 of our locations in the Atlantic provinces. We have nine morning shows; we have noon and afternoon shows; we have supper-hour newscasts and radio newscasts, and I do think that maybe the opinion of people in Atlantic Canada is that we are very much Atlantic Canadian in our content.

Having said that, we're also very proud to be able to showcase our stories on many of our national platforms like News Network, the "World at 6" and "World Report." We strive to ensure that our stories are told in that way. Atlantic Canada, I think maybe different than in other parts of the country. I can speak for certainly this region in that people do feel that CBC represents them in their place, in the place they live. It's reflective of their communities and we're in their communities and we live in those communities.

Senator Plett: I'm from the province of Manitoba and, of course, Manitoba has a lot of francophones. Mr. Simoens, you're a fellow Manitoban —

M. Simoens: Yes, sir.

Senator Plett: — and worked in Manitoba, so you know the make-up of Manitoba fairly well. I appreciate that where there is a significant presence, there should be a significant presence by Radio-Canada. We heard this morning that a significant presence, according to one witness, was more than one person in the community. I would like to have your opinion on where Radio-Canada should have a presence and how much French population should there be before you do make a presence in that area.

Mr. Simoens: I appreciate the question. I think it's maybe over my head in terms of the answer that I'm able to give — how many people would be a sufficient number to deserve a certain type of presence.

I would say that what we try to achieve at CBC and Radio-Canada is to have the biggest presence possible and try to reach as many Canadians as we can where they are. So that's something that we do. I think one of the things when we move forward with "A Space for Us All" is that we're able to use the new technology, using the web, using social networks to reach more people and reach them differently. One of the big challenges we face in moving forward is that how do we transform what we're doing right now with radio and television and try to incorporate this new technology, which is very accessible, which gives us a wider reach. How do we incorporate that into what we're doing right now without losing the people who watch a lot of television but who maybe will be watching a little less television? We'll be doing it differently moving forward. Those are some of the challenges facing us when we look at the five-year plan that we're working on right now. The strategic plan is looking exactly at that, how do we do that.

In Montreal we were able to reach communities where we weren't — ironically, we say that Radio-Canada is very Montreal-centrist.

[Translation]

It may be true that Radio-Canada focused more on Montreal at times, since there are several regions. When I lived in Longueil, we were not as well served. The station talked about Montreal, but it never mentioned Longueil. What is known as the South Shore and the North Shore were created. Thanks to programs broadcast on the Web, people were able to tune in to Radio-Canada. They were able to hear about the communities in a different way. We included people from the community and we hired local journalists. That new platform had enormous success. So, I think we have to continue to innovate in that way.

[English]

Senator Plett: Ms. Wilson, you talked about going from 143,000 square feet to 44,000 square feet, and Mr. Simoens, 50,000 square feet to 20,000 square feet. That is significant. How many employees were cut to get down to those square footages, if any? Were we just simply too large before or are we too small now? This is a significant number; this is not a small number. "Well, we have an extra couple of rooms here, so we'll lease them out to somebody." You've made a huge switch here. I would like both of you to talk a little more about those square footage changes and what you did to be able to reduce in size.

Ms. Wilson: As I mentioned to the chair, I'm new to this position, coming in to it in August when the real estate project for Halifax was well under way. Currently in Atlantic Canada we do have 300 employees and in Halifax just over 100, and as Richard can indicate, probably 20 or so French employees.

Technology plays a huge role in how we've been able to change the way that we work. Our work methods have changed. Yes, at a time in the early 1990s, we were doing a whole lot more production than we do today, in-house production, which we don't do any longer. Yes, we have partnerships with independent producers as Richard mentioned as well. We still do some in-house support of outside productions like "This Hour has 22 Minutes," but the reduction in the amount of production is one of the reasons why we can reduce the footprint significantly.

We've also changed our work methods in an integrated operation. We're able to work in different ways more efficiently. Technology has allowed us to do that, which we weren't able to do even two or three years ago. So those are just a few of the reasons.

Obviously the reduction in staff, as a result of the most recent cuts, through the draft reduction in this region did have an impact. We've implemented a three-year plan in French and in English, resulting in a number of staff leaving the organization. We continue to do that even with the announcement of strategy 20/20. In that announcement there is a further reduction in the corporation overall of 1,500 jobs, so we are becoming a smaller organization in terms of people.

As has been mentioned in the strategy, we're moving out of owned locations where we no longer require that kind of footprint because of the things I just mentioned.

[Translation]

Mr. Simoens: I will not repeat everything Denise said, but I agree with her. It was certainly the change in our work methods that caused that. In the past we had teams dedicated to radio and teams for television. There was little cooperation between them. Now they work in close cooperation. There is a lot of diverse competency. Technology allows us to do more. I think that all of that contributed a lot to the changes. There was a moderate reduction in the number of employees at CBC and at Radio-Canada over the years because of the cuts, transformations and a desire to be more effective. So we did all of that. In Moncton we own a 51,000-square-foot building. There is enormous wasted space. The building is not adapted to the needs of radio, television or the Web in 2014-15. It is a station that was built or which we acquired about 50 years ago, when it was a community centre. The building was not built to house a modern communications station. Taking all of that into account, we could move and go from 50,000 to 20,000 square feet. By occupying 40 per cent of the current space we would work in an efficient way. Nobody will leave because of that. It would simply be another way of reorganizing the work and the space. In Moncton there are no closed offices. I will not have a closed office. Denise in Halifax will not have a closed office. That is what allows us to reduce our office space. We can reduce our office space in this way. So, if in 5, 10 or 15 years we realize that we have to reduce or expand our workspace, we will be able to do so if we are renters and not owners. We will not be stuck with a physical building.

[English]

Senator Plett: As a follow-up to that, you're actually making yourself more efficient. What I'm gathering here is that the average viewer is not going to notice the difference and yet you will be saving a considerable amount of money. You've streamlined the operations. You're not doing much of what you used to do because of technology, so this is actually a good thing.

Mr. Simoens: Sure, the technology part of it and the footprint part of it, we're going to continue to do what we're doing. Some of the cuts that we're doing, though, do have an impact because they are limiting what we're able to do. We're choosing to do less programming because we have less money to do programming. It costs money to do TV; it costs money to do radio. So the less money we have or the fewer people we have, well eventually it shows and we're doing a little bit less than what we were doing. But one of our challenges, mine and Denise's, is to keep doing as much regional programming as we are able to do with the resources that are allowed us.

Senator Plett: Thank you.

[Translation]

The Chair: One of the two examples cited this morning regarding the cuts in francophone services here is the RDI program broadcast at 11 a.m. from your area. The other example concerned the radio station that used to produce a local program that was broadcast daily on the entire Radio-Canada Musique network. These two programs are no longer being broadcast. And so the Acadian voice, in your case, or the Maritime voice, has less of a presence at the national level. Nothing was proposed to replace them. I do not know if you would like to make a comment on that.

Mr. Simoens: First, the "Atlantique en direct" program was an hour and a half show that was produced in Moncton to reflect the Atlantic regions; it was broadcast daily on RDI at rush hour. It was often interrupted by all kinds of special programming. So if we had done the calculation when that change was made, we would have realized that the ratings in the Atlantic regions were not as good as expected because the program was broadcast at rush hour.

Secondly, if we relegate the Atlantic presence to a 10:30 a.m.-to-noon slot, or to the middle of the day, will the vast majority of the population listen, if you consider that most people are at work? We wanted to challenge Radio-Canada: remove those time slots, maintain all of the necessary flexibility in programming, and ensure that our teams are there on a daily basis.

As an example, Michèle Brideau or Ricky Landry, who are in Halifax for RDI, are not necessarily on air every day at 10 a.m. They may be on at 6, 10, or 3 p.m. They have a greater presence in that way. We also try to use their material. It often happens that they leave a report with us that will be broadcast at the end of the day on "Téléjournal Acadie" or rebroadcast by RDI during their biggest news program. At one point, I did the calculation and I found that the exchange was a good one in terms of minutes. But I agree with the people who say that their presence is not sufficient — we do not plant our flag and say: "Here we are, we are going to be on air on this day at this time." So, are people more interested in a token presence, or will we really have that presence on a daily basis? I am concerned by that question.

As for Espace musique, clearly we had a regional presence all day. There was an announcer in Moncton, but the musical choice was made in Montreal and broadcast throughout the country. So, there was an announcer everywhere, and everyone played the same music. We were given from 30 seconds to one minute between songs to talk about a show or some activity that was happening in a region.

Unfortunately, we had to reduce those comments because of budget cuts. Announcers used to present Espace musique in around 14 locations. In the final analysis, that added up to a lot of 30-second-to-one-minute comments every day. The bill was also large: 14 salaries. We chose to give up that part of the program rather than sacrificing a journalist. Sometimes we have to make difficult choices and it is unfortunate that that happens. We would like to keep everything, we would like to do everything. I would like to do more for everyone, but there comes a time where we have to face financial realities and that is not unique to Radio-Canada. We also have to make choices, we have to manage, we have to set priorities, and that is how we progress.

[English]

Senator Unger: Thank you witnesses, for your excellent deliveries.

Rogers has purchased the national rights for hockey although CBC retains a presence for four years. In the four years, CBC will need to fill hundreds of hours of prime time. What role will CBC Atlantic Canada play in fulfilling these hours, although from the comments you just made, I have an idea where or how you might fill some. In what way, if any, has CBC Atlantic Canada been affected by this deal with Rogers?

Ms. Wilson: In relation to filming the hundreds of hours of programming, as a result, that is something that is currently with our programming office and our revenue folks to really take a close look at. There is always opportunity for us in the regions to contribute to national prime time schedule, although, as Richard mentioned, with the reduction we won't do what we did 20 years ago, or have the ability to do it. However, in this region we have a very creative workforce and a very good relationship with our independent producers, so there are always opportunities for us to participate in pitching ideas to our programming office for prime time footprint. And we do still produce programs here that we're also very proud of and could potentially, we hope, find a place in our schedule in prime time.

So yes, there's always opportunity there for us. The door is never closed as an opportunity for us to pitch programming for those slots, even though, as I mentioned, with the reduction and the resources that we have, sometimes it's not always possible, but certainly the relationships that we have over there in independent communities is very strong and the opportunity is there.

Senator Unger: Mr. Simoens, you mentioned the reduced number of employees and that the square footage has been shrunk substantially, which is impressive. How many upper level management people were let go?

Mr. Simoens: I don't have the actual number, but I would say probably 25 per cent of the cuts were made at the management or administrative level, since I've been there. I've been there since March 2012. When I had to make some cuts, I started by looking in my own yard. I would venture probably around 20 to 25 per cent of the cuts are within the management group.

Senator Unger: We heard one witness this morning say, "You either get thinner or you die." I think you may have already heard that comment and you're certainly taking the appropriate steps.

One last question: When you removed these two programs that were so popular, what was the feedback from the viewers? What feedback did you get?

Mr. Simoens: You're speaking about RDI and Espace Musique?

Senator Unger: Yes.

Mr. Simoens: Well, when we did the RDI change, first of all it wasn't just an arbitrary decision. Obviously, there was a lot of reflection and thinking on our part, but there were also a lot of meetings with community leaders before we actually made the official move. I would say that they gave us the benefit of the doubt.

Afterwards we received some comments, some complaints about that. Whenever we get any type of comment we always try to deal with it and see if there's anything we need to be tweaking or working on.

But I would say I haven't been inundated with a lot of complaints about that, at least recently. Some people still regret that decision and that's fine. I think it's fair ball, but as I was saying to Senator Dawson, when we start looking at the actual statistics and the actual results of that change and how we're maybe more present or present differently, I would say, over the entire schedule, it's maybe not as big an impact as some people might imagine. However, symbolism of being there every day from let's say 10:30 to 12:00 is an important symbol, but is it the most efficient symbol? I'm not sure it's the most efficient way of doing it.

Senator Unger: Thank you.

Senator Cordy: Thank you very much and welcome to our committee hearing.

I agree with you, Ms. Wilson, that people in the Atlantic region looked at CBC in a positive light. There are certainly some incredible programs being produced here in Halifax by independent producers for CBC. But are there challenges for CBC and Radio-Canada that are unique to the Atlantic region that you might not find in other areas of the country, since I'm a Nova Scotia senator.

Ms. Wilson: The challenge for us is the geography. In a lot of cases Atlantic Canada is a big region. If you go from Nain in Labrador to Happy Valley-Goose Bay, it takes a significant effort to travel to be able to cover the stories in those small places. Certainly one of the challenges is the geography itself. I will let Richard add to that.

[Translation]

Mr. Simoens: One of our big challenges at Radio-Canada is indeed geography, but also the expectations of Acadian men and women. Acadia is a vibrant community and it is the majority community in some regions of the country. It is a community with a distinct culture that has a great deal of success both in Acadia and on the national and international scene. Its success means that it has big expectations from Radio-Canada; it expects Radio-Canada to continue to support it in the development and showcasing of its artists. People turn to Radio-Canada to ensure that the population finds out about its activities, special programs, and that it becomes known nationally. The expectations are enormous as compared to our resources. We do our best with the means we have. Aside from the challenge of the territory, people have these big expectations. They want an intimate relationship with the public broadcaster, particularly on the French-language side. And if we do not meet those expectations, no one else will do so. The community radio stations do so, but not at the level we do it. We are about the only ones who can offer this kind of pan-Canadian exposure. In short, the expectations are gigantic.

[English]

Senator Cordy: Perhaps it is the expectations of the Acadian people. You said the people are generally satisfied with Radio-Canada. Yet, this morning we had representation from the Acadian Federations of Newfoundland and Labrador and Nova Scotia and the society of francophones from New Brunswick and they clearly feel that their needs are not being met by Radio-Canada. In fact, the gentleman from New Brunswick said they often get their news from English CBC and that they're missing the distinct Acadian culture in the programming of Radio-Canada. From Nova Scotia, we were told that they are being marginalized by Radio-Canada and that they're not seeing themselves, that in fact everything is coming from Montreal. You mentioned that the musical groups and artists are not often from the Acadians of Atlantic Canada. We heard that from all three groups. They often have to get their news from a source other than Radio-Canada, which is what they would like. So we're going back to the whole Montreal aspect of it; the vast majority of the information coming to them is actually coming from Montreal.

I know you touched on the expectations of the Acadians. Certainly in Nova Scotia the Acadian Federation is very strong and they do an excellent job of educating the rest of the province I think, so how can they feel that Radio-Canada is best serving their needs?

[Translation]

Mr. Simoens: I would like to make a clarification. The francophone and Acadian communities are generally very satisfied with Radio-Canada in Acadia; they are pleased with the work we do here in the region. However, their expectations are much higher regarding the national network. They want to see a greater presence. They want to see themselves on the 10 o'clock "Téléjournal." If they do not see themselves on the late evening "Téléjournal" on the French network, they turn to CBC's "The National," which is far more pan-Canadian in their opinion. That is where they get their news.

I understand their choice. Even if they listen to CBC rather than Radio-Canada, at least they are still with the public broadcaster. And that is good news for us, but it is clear that we would prefer that the francophone and Acadian communities be better represented in all of our newscasts. We must not judge Radio-Canada's actions by the 10 o'clock "Téléjournal." Overall, our websites are very good, and there is a great deal of information to be had there. Someone who wants to know what is happening in Halifax, Saskatchewan or Manitoba can find relevant information on our websites.

Our challenge is to find ways to ensure that Acadians will be represented in all of our radio and television programs. In my opinion, our radio has made giant steps over the past one or two years. We began to do more work with them and they have a more marked presence. I do not know if the Nova Scotia or New Brunswick Fédération des Acadiens mentioned this to you, but as a listener — of course, I am somewhat biased — I can see that difference. I see that Acadia is more present in all of the network programming.

This summer, even on the television side, the Pénélope McQuade program hosted Lisa LeBlanc, Radio Radio and Les Hay Babies, who were launching a new disk, and Joseph Edgar. On a network program, we showcased Acadian culture. The other day, someone asked me, "Are they there because they are Acadian? Are they there because they are popular? Are they there because they are also known in Quebec?" The answer is probably all of the above. And all the better!

We are not looking for the reasons behind what we did; there is no reason. It is not about respecting a quota or an obligation or quantifying things in an artificial way. We do this for the right reasons, and I understand people who criticize because they want to see even more. It is entirely legitimate for them to want to ensure an even stronger presence.

I would like to mention the efforts we make to try to meet that need, despite the financial challenges and the francophone demographic, which is entirely different than that of the CBC.

[English]

Senator Plett: Mr. Simoens, you talked about youth group media habits. Tell me about youth group media habits.

Mr. Simoens: Well, it's quite interesting. On two or three occasions we invited about 12 university students to talk about where they get their news, what they do and what they are listening to. How do they get the material they are listening to?

Recently, Denise and I were with Hubert Lacroix, our chairman, and we met a group in Fredericton. There were 12 people around the room. When we asked them how many have a television set, nobody has a TV anymore. Everybody is listening or getting their news off their cellphone or their smart phone. None of them, I believe, has an actual phone plugged into the wall. They generally don't pay for cable television, so there's an impact somewhere along the line for CBC and for Radio-Canada and also for other television networks that rely on cable subscriptions to finance their operations.

It was quite revealing to see that people don't have TVs anymore. Those who do have a television set are actually using the TV set to plug in their computer just to have a bigger screen, but they're not actually watching the news at 6, or "Unité 9" at 9 p.m., or Rick Mercer on Tuesday night. They're watching it whenever they want to watch it.

It's a big challenge because of the big change for CBC and Radio-Canada. We've always been in an environment where we do radio. We push it out and people say, "Oh, it's 8 o'clock. I like this program. I'm going to watch that program and I want to listen to that program." It's not the way it's done anymore.

Some people still do that. I'm still one of those. If it's 8 o' clock and I want to watch a program, I will sit down and watch it. I'm probably a dinosaur; I'm a dying breed for sure.

People who are 18, 19, 20 years old are watching television or listening to radio or getting their news when they want to get it. So the challenge for us, and I think that's a nice thing of our strategic plan, is how CBC/Radio-Canada adapts to that new reality. How do we bring all of that numeric, digital broadcasting into our daily operations? What are the challenges of bringing digital into our operation? Nobody is saying, "Well, here's a whole bunch of money to bring more digital to do more web, do more this, do more that." We have to make a decision and say, "Okay, well, let's do a little bit less of this because we need to be doing more of that," and gradually move toward a different way of doing things.

Senator Plett: Clearly this is one of your challenges and probably a fairly large one. What are the top three challenges CBC faces today in the changing media environment?

Ms. Wilson: One of the challenges is the continuous reduction of funding and the impacts. At some point those reductions do reach us in the regions, and we have to find ways to contribute and to reduce our resources as a result. It's definitely one of the challenges.

The challenge resulting from that is the sustainability of what we do. Can we sustain what we do today? We strive to do that and we strive to do it in a world and in an ever-changing environment where people consume information and content differently. So there's a huge transformation happening at the same time as we're facing the challenges of reductions in our budgets. But we still have to be able to deliver the content to our audiences and we're committed to doing that. Definitely one of the big challenges is to continue to sustain what we do in the face of the reductions that we see continuously.

Senator Plett: I think what Mr. Simoens said here about the youth clearly has got to be a large one.

If I can build on what you said, Ms. Wilson, I appreciate that when any organization has budget cuts, when there is less money to go around, it has got to be a struggle. I think we all appreciate that, and I'm sure you have an appreciation of this as well. But as Mr. Simoens has said and we have said many times, there are the iPads, the iPhones, all these things.

I concur with what you're saying, Mr. Simoens. Recently, I wanted to watch a certain show, and my administrative assistant said, “Well you can stream it and then plug it into you television.” I had no idea what streaming was and I still haven't been able to figure out how to do it. Nevertheless, she does not subscribe to any television and she watches all the movies on a television set but through the iPad.

That being said, that has got to be one of the reasons why there also have to be budget cuts, because there are fewer people on a regular basis watching live television.

The Chair: Please answer the question and at the same time consider it a final statement, because we are running a little late and other witnesses are waiting.

Mr. Simoens: I just want to, if I may, say that I'm not sure that there are fewer people. I think we're able to reach a lot more people now. It's just we're reaching them differently. So it's not less money; it's probably more money that we need to be able to do that.

We have to do our part. I think one of the challenges we have is, like I was saying, how do we take some of the resources, prioritize and move some of that money into a different platform that will bring us to doing exactly what you're saying? What you're suggesting is that we have to get the youth, reach them where they're at, which is a totally different place from where we're at or where we've been. So that is an important thing. It's a very big challenge.

If I may answer the other two priorities, one is that CBC/Radio-Canada be able to step up to the plate and meet the challenge of change. The last thing that we need to have happen is that we become a BlackBerry or Encyclopaedia Britannica. They had all this knowledge, knew where things were going but didn't change fast enough and just disappeared or were in trouble. I think it's extremely important for us to make the right decisions and to move along the right path.

The difficulty that we've got, and it's not any different for us than it was for BlackBerry or it is for any private or public company, is that we don't have a crystal ball to know exactly where we're going to be in five, ten or fifteen years. Where is that industry going? The iPad you have didn't exist in 2010. So that technology is changing at a rapid pace. We have to position the public broadcaster properly so that we are able to adapt to whatever the challenge is, whatever the technology is in a timely fashion.

I would say the third challenge that we've got is how do we convince Canadians and how do we convince you that CBC/Radio-Canada, as a public broadcaster, is an essential part of the fabric of this country? I'm totally committed to this. I've spent 38 years working for this company. One of the reasons I chose to do that is because as a franco-Manitoban, I was able define who I was, to help me be a better Canadian.

We do have challenges and we may have things that we have to make better. We're not perfect, but how do we convince people that CBC/Radio-Canada is essential to this country, to the make-up of the country, to the reflection of who we are as a nation? I think that's one of the big challenges that we've got: How do we convince people that we have to be there?

The Chair: Ms. Wilson?

Ms. Wilson: Thank you very much for giving us this opportunity today. We really appreciate it.

In closing, one thing that I would add to what Richard has said is remembering that local is the lens into the CBC. What we do in these regions is very important. We have to continue to reflect ourselves to the rest of Canada. We do a very good job of that here and we want to continue to do that. I just want to reinforce how important that is for us to remember as you continue with your hearings.

The Chair: Thank you.

Senators, our next witness is John Wesley Chisholm, Creative Director of Arcadia Entertainment, a Halifax-based production company.

Senator Greene and Senator Cordy have been trying to convince us for a long time that Halifax is a great production region, and we're starting to see that with the quality of the witnesses and the presentations we've had.

I know you don't have an opening statement, but I'll just set the stage. We are hoping you can address the issues of independent production companies here in the region and how they relate to the changing environment that Radio-Canada has to go through. How do you relate that to the CBC and how do you see the future of broadcasting for CBC not only based out of Halifax but as a Canadian organization?

John Wesley Chisholm, Creative Director, Arcadia Entertainment: I would love to do that. Thank you all very much for asking me here today.

I think the best way for me to start would be to boast for a couple of minutes about my company and what we do and then connect that to CBC, if that sounds okay with you.

The Chair: It does.

Mr. Chisholm: My name is John Wesley Chisholm and I am Creative Director of Arcadia Entertainment here in Halifax. We're a factual entertainment company, so we produce the kinds of shows you would see on Discovery Channel, History, National Geographic and so on.

About three weeks ago I was getting ready to go to Cannes, to the world's largest television sales market, and I got a note from your clerk asking if I wanted to come down and say something. I thought surely by the time I get back from Cannes I'll have something smart to say. I arrived back home yesterday and I'm not sure that I do. It remains to be seen.

The company I have has produced in the last 13 years about 320 hours of factual television for the world. Our business plan is to find stories here in the Maritimes that would be of interest to Canada and to the world. Through National Geographic and Discovery Channel, our shows are on the air in over 100 countries and in over 26 languages. I have 30-plus full-time, permanent employees; it's the way our business is structured. We do about $6 million or $7 million worth of business a year and the business is growing about 10 per cent a year.

Last year we won the Canadian Screen Award for top documentary; that's the highest award in Canada. We had an Emmy award nomination, and just before I left to go to Cannes, I won the Ernest & Young Entrepreneur of the Year Award for my work in this business. So we're having a really good time. We make shows about Maritime subjects for Canada and for the world, so you would think that I would be very interested in CBC and what's going on and they would probably be one of our customers. They're not and we're not.

Before I came down here I went through the building and talked to everybody at the company and said, "What do we think about CBC?" And it was a lot of blank conversations; no one thought anything; none of us had any opinions. We don't do business with CBC. My main job is pitching shows. I propose show ideas to broadcasters, so as part of my job I try to meet with CBC and pitch them. I would say six times a year I approach them to try and talk about shows.

To date, in the 17 years I've been in this business and the 13 years I've had this company, I've succeeded one time, we've sold them one show. And that's a failure rate that's astronomical. I would have a 99 per cent failure rate if my job was to pitch shows to CBC.

So how do we get our shows out there? Well, we work for other commercial broadcasters in Canada whose audience for our shows is equivalent to CBCs audience but pay 10 times as much in license fees and are 10 times more supportive, but most importantly are infinitely more accessible to us. We simply can't get through the Catch-22 maze of bureaucracy at CBC to talk to people about what we think shows should be.

So my success is zero. I have nothing to say about CBC because they're not part of my business. Nobody who works for me, nobody I know depends on them or watches the channels. We're talking about CBC TV.

We hear a lot of talk about what CBC was. I am the oldest person in my company by far — it's a young company — and nobody cares much about what CBC was. We care of course about what CBC will be, but no one sees a vision.

Ironically, we sell a lot more shows to BBC than we do to CBC, and we care about them intensely; we understand them very well. This morning, as I was gathering information, I looked at the CBC and BBC Wikipedia page. The BBC page is amazing. It's transparent. It explains the mission, what they do, where their money comes from and goes. It's very clear. The CBC page is just murky.

The folks who were just up here were fretting about technological change and whatnot. I think that's a very old-time concern. I live in a world of story wars and I think we all live in an age of story wars. The people with the best stories win. If you want to find the future success of any storytelling organization, you just tell the best stories; that's what you have to do. If CBC is to see a future, it just has to concern itself with stories — not bureaucracy, not buildings, not technology, not blah, blah, blah multi-platform. It is now as it ever was since we all huddled around fires in savannas in Africa: The person who tells the best stories wins. It's very simple.

I think I'll stop there.

Senator Plett: Thank you Mr. Chisholm. How do you measure success in your company?

Mr. Chisholm: My success?

Senator Plett: You don't measure it with selling to CBC. How do you measure success?

Mr. Chisholm: My company measures success really simply. Success is defined as a long-running, returnable series that we can make here at home with great characters. That's the foundation of our business.

Senator Plett: So success is somebody wanting to watch what you put out there.

Mr. Chisholm: It's true.

Senator Plett: So we could say that CBC's success or lack of it would also depend on their market share or how many people want to watch it. Would that be a fair statement?

Mr. Chisholm: If folks aren't interested in the stories you're telling, you're not successful.

Senator Plett: Why do you care? You say you care about what CBC will be but you don't care about what they were. Why care what they will be?

Mr. Chisholm: Because we might get to tell some stories successfully to the folks, and that's our interest.

Senator Plett: How actively are you pursuing CBC?

Mr. Chisholm: That's a good question and I thought about that coming down here. I must admit, I'm getting worn out. I pitched CBC a show yesterday and I'll pitch them another show next week, so say 12 times a year I pitch a show. These aren't shows that are wild ideas; these are the shows that National Geographic, International Discovery, PBS, BBC, ITV, Channel 4 have already bought and I'm circling back around and saying, "CBC, would you be interested?"

To give a concrete example, we have a series called "Hope for Wildlife." It's about a wildlife rescue and rehab center here on the Eastern Shore of Nova Scotia. You may see some DVDs kicking around up there. It's conveniently run by a woman named Hope and it's a very popular series. It's on the air in 27 countries. It's going into its seventh season, but it's not on the air here in the Maritimes. I've gone so far as to go to CBC and say, "You can have it for free. Just meet with me, talk to me, watch the show that the world is watching and the rest of Canada. It's on Oasis; it's on Knowledge Network in B.C." It's the top-rated show on Knowledge Network in British Columbia, but it's not here in the Maritimes. I couldn't get a meeting, so I have no idea what they think or thought of that idea. I got no response.

Senator Plett: I have another question, but I do at least want to make a comment, Mr. Chair. I know that our Library of Parliament research analyst is taking scrupulous notes. I find it quite strange that an organization that keeps on pounding the pulpit about Canadian content, when presented with an opportunity to buy some Canadian content, or even get some Canadian content for free, would turn it down.

Mr. Chisholm: I won't say they turned it down. I said they did not respond; I could not get a contact.

Senator Plett: Fair enough. That, I would say, is almost the same thing.

Where do you try to sell? Do you go mostly here in Atlantic Canada or do you go to Toronto, do you go to Montreal?

Mr. Chisholm: We sell television to the world. As I say, I just came back from Cannes, from the world's television market —

Senator Plett: No, I mean CBC.

Mr. Chisholm: Oh, CBC. Well, here in Halifax.

Senator Plett: Okay. Continue with what you were saying.

Mr. Chisholm: We sell to the world. I just came from a market where we sold shows to National Geographic and PBS, Nova Science series.

Senator Plett: Who is your biggest customer in Canada?

Mr. Chisholm: Oasis. Blue Ant Media Company was recently put together by Michael MacMillan. We work in an output deal with them and supply them with going on 30 hours a year of television.

Senator Plett: Well, we might have some questions for CBC on this matter, Mr. Chair. Thank you very much.

The Chair: Too bad the sequence was not reversed.

Senator Plett: Right.

The Chair: Senator Cordy?

Senator Cordy: I think that you've clarified your position. Congratulations on such a great company. I'm from Nova Scotia, by the way. I live in Dartmouth. I've heard of Arcadia Productions, but I didn't realize that you are so large.

Mr. Chisholm: We don't have a sign because we don't have a customer within a thousand miles to see the sign.

The Chair: I'm going through your website as you speak; very interesting products. I'm surprised that CBC has not found some shelf life for them.

Mr. Chisholm: Sure.

By the way, we started with the idea that we would make shows about the ocean, and the joke reason was that Michael Donovan and DHX were taking up so much room on land that there was no space left, so we would just go out into the sea. That helped us hone our storytelling skills and still probably half our content is ocean adventure stories. I’m very excited to be coming home from the market with a new ocean adventure series that we’re going to make here in Nova Scotia.

Senator Cordy: I do have a question. We do have "Theodore Tugboat," though. Would that be classified as ocean?

You spoke about the maze of bureaucracy at CBC. How challenging is it to make your pitch and to get a response within a reasonable period of time?

Mr. Chisholm: Well, it's infinitely challenging; it just plain doesn't work. As I told you, in 17 years of doing this, I've sold one program. That one program, by the way, was called "Polar Bear's Longest Summer" with "The Nature of Things," and that got an Emmy Award nomination, won the two Canadian Screen Awards and was the top program. You would think now I would have an in with that, but it's still very difficult to get them on the phone and I have no real contact since.

Senator Cordy: So who would ultimately make the decision on that? You talked about the bureaucracy. Would it be Halifax CBC, Atlantic CBC or would it have to go to Toronto?

Mr. Chisholm: The one success we had was going directly to see the folks at "The Nature of Things," Ironically we met them in Washington, D.C., at a conference, where somehow we cornered them and convinced them to look at our idea.

Senator Cordy: I, too, wish that you had been appearing before the CBC earlier because I find this disconcerting, to say the least. You've got award-winning productions based in Halifax and we want Canadian stories told to Canadians. So we can have a story about polar bears sold to Atlantic Canadians or Atlantic CBC but not one based on an animal shelter on the Eastern Shore.

Mr. Chisholm: "Polar Bear" is a great example. Before Canada, we had National Geographic International, National Geographic US, Universal Blu-ray releasing for the DVDs. We even sold it to S4C in Wales before we were able to get the attention of the CBC folks. They came in at the very last.

I will just point out regarding financing that they got the show for 10 cents on the dollar, and that seems to be the only possible way to do it. So my free economics was not just drawn out of a hat; that's the price that seems to be the going price.

Lots of folks talk about the $1.5 billion. My background is in finance, so I always ask myself when I hear numbers, "Is that a big number?" I don't think it is a big number relative to the federal budget of Canada. But it's also a deceivingly small number because the CBC, when they buy from independent producers, they're leveraging their money. In this case it was something like 10 cents on the dollar that they got the show for, and it also had the Nova Scotia film tax credit, the federal film tax credit, CMF or Canadian Media Fund money and all the international broadcasters came in before they came in. Depending on your point of view, CBC is actually drawing on a lot more Canadian money than people think when they quote the $1.5 billion or they're very shrewdly buying stuff dirt cheap. They're buying dollars for 10 cents.

The one strand that's operational in my genre here in Nova Scotia is "Land and Sea." We've often gone in and, you know, offered to do "Land and Sea" packages, but the price they're offering per hour is less than one tenth what a commercial broadcaster in Canada would offer for the same size audience, for the same program. So we simply just won't do business with them. You have to have some self-respect.

Senator Cordy: You said you're the oldest worker in your company?

Mr. Chisholm: Yes.

Senator Cordy: Where do you get your workers from? Atlantic Canada or from all around?

Mr. Chisholm: I make them.

Senator Cordy: You make them?

Mr. Chisholm: I hire local people, the smartest and nicest people I can find, and then train them to do whatever it is we want them to do. The technology in the years that I've been at it has been changing so fast and so rapidly, any kind of university courses or experienced industry people just are a bag of bad habits and problems. It's easier to create great workers from nice, smart people. That's where we find them. Happily the Maritimes is filled with nice, smart people.

Senator Cordy: And I agree with you.

Senator Plett: If I can follow up on that question, where did you train? What's your background?

Mr. Chisholm: That's a very interesting question. To make it as short as possible, my degree is in finance and I am currently doing a masters at the London School of Economics as a sidebar.

When I got out of university, I was offered a record deal with Universal Music with the rock band I have. So as short as possible, accountant plus rock star equals TV producer.

The Chair: We hope you will be following our hearings because I'm quite sure that Senator Plett, Senator Cordy, Senator Unger and myself will probably be passing on some of the questions that you posed today about being a success around the world but not being a success with CBC. We have many people from the CBC coming in front of us over the next few weeks and months, and we will certainly try to get some answers that you didn't get.

Mr. Chisholm: Cheers. Good luck with that.

The Chair: Thank you very much.

Our next witness, senators, is John Young, a lawyer with Boyne Clark LLP.

Please proceed.

John A. Young, Q.C., Lawyer, Boyne Clarke, LLP, Lawyers: Mr. Chairman, senators, thank you very much. It's a pleasure to be here. I'm listed on your documents as being a lawyer, but I think I should say that for a 10-year period, from 1976 to 1986, I was a member of the Board of Directors of the CBC, the executive committee, and I was chairman of the CBC pension fund. By point of reference the presidents in those days were Al Johnson and Pierre Juneau. Although I've had no direct relationship with the CBC since then, I'm a citizen and I pay attention and I watch.

I want to look at this more from a macro point of view than a micro point of view because it's my experience in dealing with issues involving the CBC that everybody always speaks about it from their own personal viewpoint about a particular thing they either like or dislike at a given point in time. The CBC and its many services and languages impact all of us at a given point in time, both negatively and positively.

It does strike me that the challenge for the CBC has not changed since Prime Minister Bennett and the government of the day and the Parliament of the day created the public broadcaster. Although the technology and the economy have obviously changed, the challenge for broadcasting has not. The original raison d'être still applies, and that is how do you get a Canadian voice and Canadian stories on the air when you have this dominant voice to the south that either could constrain the French language broadcaster historically and certainly overwhelm the English language broadcaster?

The issue then is, in today's terminology, private broadcasters are having a difficult time as it is. So does the CBC. Broadcasting is changing very dramatically because of technology and the regulatory environment. I think that the fundamental challenge facing the CBC is the same: How do you get programs on the air and who is going to pay for them?

The immediate predecessor who spoke this afternoon talked about getting shows on the air, and I think one of the difficulties is nobody has the money to buy shows at the full price. Most television and radio broadcasting today has many partners, and if you go to a film you'll even see that in the theatre. By the time you go through the various production companies that have an interest, everybody has a 5 or 10 per cent interest in the product.

It's a very difficult world for broadcasters because it's changing. One of the difficulties the CBC has and will always have, in my view, because of the parliamentary system is that it is funded annually. For example, unlike a private broadcaster, it can't do the capital expenditures you would require to make fundamental change. If, for example, you want more online and to get out of the transmission business, and I think in the long run they will, which would save them a great deal of money, that requires money. The CBC, unlike a private operator, cannot go to the bank and get a line of credit or get an investor to put up the money is always playing catch-up. That will hamper the CBCs adjustments to the new technologies.

It's also difficult for private broadcasters at the same time, but they have access to capital and the CBC does not. That may be a fundamental weakness that should be looked at over time because if you want to have a national public broadcaster, it needs to be able to fund the structural changes necessary.

It's interesting to me that the CBC's websites and online services get enormous attraction. I know just because I have it in my office that I can punch up the news anytime I want. During the Olympics I punched up a little too many sports on occasion. But that's the changing technology; more people are actually listening to and watching all of these things on a variety of different platforms. To fund all of these various platforms is going to take, in my view, more money.

It doesn't necessarily have to come from the Parliament of Canada. It may come from the various funds that are available that were mentioned earlier. It may come from advertising. It may come from paywalls. Many PBS stations in the States now are running paywalls for their online activities. I would not advocate that for the CBC. I don't think the public should be paying twice.

However, I think some imagination is going to have to go into how you capitalize a public broadcaster to be relevant in the future when the changes are going to affect all the broadcasters and make it more and more difficult to get a Canadian voice on the air. The kind of thing that Netflix represents is a good thing for the consumer. It's efficient and it may have an extraordinary adverse impact on private broadcasters and the public broadcaster. To compete with that people are going to have to adjust, and as I say, the adjustment is going to take money.

I don't think that any of us spend enough time focusing on the long-run strategic objective here. It's a national broadcaster. Do you still broadcast locally and regionally? I would argue you should and you must in French and in English, but to do that is extraordinarily expensive, and I'll give you a simple example. In the Maritime provinces, CTV Atlantic, which does a very good job by the way, is down to one station in Halifax and they serve the whole region from one station — New Brunswick, P.E.I. and Nova Scotia. CBC has one in each provincial capital — Charlottetown, Fredericton and Halifax — as well as the French network operating out of Moncton for the region. Those are expensive operations. They're very popular and they get big radio and television audiences. Even CTV would tell you that it's difficult to broadcast in this environment with one station. Because of the competitive environment, the changing technology, the advertising market, it's a very, very difficult job for any broadcaster. The CBC, because it's a public broadcaster, is obligated to do certain things that no private broadcaster should ever be expected to do.

I think that many Canadians, as with a lot of the services we get from government, want maximum service but, generally speaking, don't like paying for them. This is another example of that. Unless people wish to narrowly define the service and eliminate certain things, you're gradually just going to squeeze the services down so you get fewer programming and more repeats on all of the various networks and stations.

I do think that it's very difficult in the parliamentary environment, but it would be very useful if people could take a longer term view and say, "Okay, where do you want to be in 5 years or 10 years and how do you get there?" Where you are going to be next week is already in the can; there's not much you can do about it. But what do you want from this organization five years from now given their very rapidly changing environment economically and technologically? I think that if somebody would pay attention to that it may end up resulting in a better organization in the long run and a more effective delivery of services that Canadian will need as we go forward in this multiple channel universe that is becoming accessible on my BlackBerry as I sit here.

Thank you.

Senator Plett: Thank you, Mr. Young, for being here.

We're talking about CBC and you at least alluded to CBC competing with people south of the border. They're competing with Global and CTV here and they're losing market share. CTV, you say, has one station in Atlantic Canada and they do everything from one station. CBC, I think we were told earlier, had 10. When you're losing market share, you need to either increase that market share or start cutting back a bit, do you not?

Mr. Young: The answer to that is both yes and no. Market share changes week to week, month to month and year to year. I can remember in the early 1970s that CBC Radio nationwide had a 1 per cent audience. Today it has roughly 10 per cent of the market, which is a huge share of the market nationwide because no other broadcaster can match that. If they were selling ads they'd do very well. I don't think they should, by the way. So one of the reasons why you would lose market share is you're not making the investment to get the market share.

One of the reasons why the private broadcasters in Canada are doing quite well in terms of audience but not quite well financially by the way, generally speaking, unless you're a specialty broadcaster, is that in effect they're just repeating American shows most of the time. I'm not complaining about that. If I was a private broadcaster that's what I would do because that's what your revenue source is. Currently the CRTC of course allows them to substitute advertising in those American shows so that they can gain revenue from it. Whether that changes or not is up to the CRTC, but it's an issue they're now confronting. So if you're broadcasting a very popular U.S. television drama which costs $3 million to $4 million a week to make and you're trying to produce something for half a million dollars, you're not going to do very well in market share. The trick is you have to invest to get the same bang for your buck.

One of the reasons that the Americans have done very well is they have a huge market both domestically and worldwide and nobody can match it, and it allows them to recover. But most of those American television shows do not make money on their first run on prime time in U.S. networks. They have to sell them overseas. Don't forget: You talked about 10 cents on the dollar; you're paying less than 10 cents on the dollar to buy a one-hour American television show than they are to produce it. So you can get a big bang for your buck domestically by getting a bigger audience. If you want to get a bigger audience you have to invest in programming that's going to attract people.

The CBC also has an obligation to invest in programming that is representative of certain aspects of the country that may not necessarily get massive audiences every hour of the day, but it should be relevant to most Canadians at some time during the day or the week. If you take Radio-Canada, historically it's done extraordinarily well in Quebec because it produces more television shows than almost anybody else in North America. In fact, at the Maison, in the 1990s they produced more French-language television than anybody else in the world, and they were getting big audiences for it and still do. So you need to balance the cost of doing something with the benefit that you'll get from doing it.

Market share in this business is very fickle. If you throw the Olympics on, your market share is going to go up. If you put on a first run American drama, your market share is likely to go up. If you put on a show — without being derogatory — about polar bears, your market share is going to go down. That's why it's on a specialty channel. Specialty channels have a niche audience. Because they get a fee from the cable companies, it's a profitable operation. As you know, Canadian networks have said they like to get a fee from cable companies as well, but there has been no regulatory success at this point. It allows specialty channels to buy television shows that the prime networks will not buy because they have a regularly scheduled revenue stream coming in from you and I as cable subscribers. The Canadian television networks do not get that. They either rely on advertising if you're private or a combination of advertising and public funding if you're the CBC.

Senator Plett: You've mentioned him twice, once during your remarks and now again, Mr. Chisholm right here from Halifax, and you've mentioned his show. I certainly don't disagree with you that probably if somebody is advertising a show about polar bears — even though I'm from Manitoba and there are lots of polar bears there — I might not be the first one to jump to the television set to turn that on. However, we're talking about buying television shows; we're talking about the cost of it. This man was offering award-winning shows to CBC at no cost and they still didn't take it. Now that's got to be a bad business decision.

Mr. Young: I'd like to hear the whole story on all of this.

Senator Plett: So would I.

Mr. Young: I hope you do. I'm impressed by his performance and I do know that they produce very good television shows.

The dilemma for the CBC in some respects and for the other network broadcasters is this question of how niche do you get? Your point about market share, on one hand, in the morning you can run children's programming, as the CBC does, without commercials on television, for example, and you're appealing to a young child audience. But where do you run niche programming if you don't have a specialty channel, which is why all of his shows are on specialty channels, not on CTV, Global or CBC. That's my guess just listening to the description of the kind of programming. That doesn't mean they shouldn't be on the CBC.

Senator Plett: If I can interject for one second, CBC is, to a certain extent, a specialty channel in light of the fact that they are getting the subsidies, in light of the fact that they are being told to run a certain amount of Canadian content that the private broadcaster isn't asked to. So to some degree they are a specialty channel.

Mr. Young: Actually, I disagree with you there and I'll tell you why. First of all, the CBC and private broadcasters have to run Canadian content in the same fashion. They both have a regulatory requirement for Canadian content. Actually both of them get subsidized in different ways from the various production funds that there are to make this Canadian content cheaper to the broadcaster. So if you see a show on CTV or Global, a drama, it will be produced with some element of funds that came from the public, not entirely, but some. So everybody in this industry in Canada is subsidized directly or indirectly, in whole or in part, as it is in most places in the world. This is not unique. Indeed, even in the United States much of it is the same, from state and local subsidies for production.

The CBC has an obligation — and this is where I do agree with you — to air shows that would not necessarily be aired by a private broadcaster because they would not be commercially successful. I agree with you wholeheartedly there.

Now whether this particular show that he was talking about is the right show or the wrong show I don't know, I haven't seen the show, but I would like to hear the whole story about it. I think the CBC probably gets approached by many broadcasters and film producers throughout the country every day of the year, and I'd be interested to know what kind of process they now have for evaluating, funding or determining which of these shows to buy or not buy. You may have the opportunity to find out that information.

Senator Plett: Follow our hearings and I think you will find that they will be asked that question.

You were talking about some of the difficulties that CBC has. I don't disagree with you entirely here but I do in part, about them not being able to fund what they want to fund because they are being funded annually versus monthly. The fact of the matter is —

Mr. Young: No, not annually, monthly.

Senator Plett: The subsidy comes annually.

Mr. Young: Yes, rather than over a five-year period or something so that you know where you are.

Senator Plett: But they know five years ahead of time that they're going to get their $1billion a year.

Mr. Young: With respect, I don't think that's true.

Senator Plett: Well, it's fairly certain. When is the last year that they were cut.

Mr. Young: This year.

Senator Plett: This year. Okay, fine, but I mean before that. They were cut $115 million this year. They were cut back before we were in government, so that's at least well over 10 years ago. I'm sure my friends over there could tell us when Jean Chrétien made the big cuts; we made the small ones. Nevertheless, they were cut back then and now they were cut again. So they've got a pretty good idea that they're going to be okay now for the next five years. I don't think the government is going to come along and do that, but maybe they will. I'm not speaking on behalf of the government, so certainly I don't want that.

But they started in 1930 and they should be able to make five- or six-year plans. Obviously, from what you're saying, I don't think they're doing that.

Mr. Young: First of all, I don't know what they're doing today but I think I can guess.

What I'm talking about is we do have annual budgeting and that's a parliamentary process I accept and respect. When I served on the board of the CBC, I went through four prime ministers — two Progressive Conservatives, two Liberals — and I find that all governments have the same view of the CBC when they're the government; that is, they would prefer it wasn't around some days because it can be a nuisance. When you're in opposition, you tend to like it a little more, generally speaking. That's an observation of my own and I have no evidence to support it other than anecdotal. So I don't think it's any one government.

What I'm talking about is a structural change. The problem the CBC has is that, unlike a private broadcaster, it doesn't have access to capital. You're right that they can probably figure out within a range what they're annual revenue stream for operating might be, but to make the changes you have to make, like if you're going to cease transmission off air, say, in Toronto and go to online and all these other things and apps and everything, you need capital money. The Parliament of Canada generally provides an operating grant. It does not have an investment portfolio and it's not allowed, by the Broadcasting Act, to go to a bank and borrow money. I'm not suggesting it should go to a bank and borrow money, but the lack of capital funding inhibits technological and programming changes which might indeed make the CBC cheaper and more efficient in the long run.

Senator Plett: If I could make one comment, I'm not sure whether our current Prime Minister was one if those four prime ministers that you talked about, but if he was, I would like to state for the record he's not a Progressive Conservative Prime Minister. He's a Conservative Party of Canada Prime Minister.

Mr. Young: I'm aware of that. No, that was Mr. Mulroney and Mr. Clark, Mr. Turner and Mr. Trudeau.

Senator Plett: Sorry, that's why I said "if he was one of them." Thank you.

Senator Unger: Thank you Mr. Young, your comments are extremely interesting. Based on what you said, do you think the CBC needs to have a narrower mandate? Is their mandate too broad?

Mr. Young: It may well be. I think the choice may be what can you afford to do? Also, what is necessary and desirable to do given the changing environment?

On one hand, the tremendous penetration of online product that will become increasingly available may make it more necessary that you get more Canadian product out there, but to do that you may want to do that in a different way. Instead of building TV stations, you may want to do more online; buy television shows to put online rather than on a TV station. Or you do like the news network does: You have one channel and it's on a satellite. You don't have stations all over the country. So you may need to give up something in order to get something.

The issue then would be what do you give up? For example, do you do what CTV did and shut down the stations in Charlottetown and in New Brunswick and just run it out of Halifax? My guess is that that is not a publically acceptable choice if you happen to live in P.E.I. or New Brunswick. Or do you shut down French-language stations in principal English markets like Halifax? My answer is that nationally that would be, in my view, an extraordinary mistake, or if you shut down an English station in Quebec City — same rationale.

The issue is that once you decide you want to take something away, what is it you take away? It has taken over 70 years to build this company and in a changing environment that's been adapting. It cost them a lot of money to go digital, which the corporation did as did all other Canadian broadcasters. The private broadcasters have a simple answer. They shut down. I would predict, for example, that if we get out of packaging for cable channels and we go to single channels, you'll probably lose half your channels in the first five years because the tendency is to focus on a few sports channels or a news channel or a movie channel. Channels like Oasis would be more difficult if you didn't package them as a group because people might not want to pick them up individually, or the market would be so small it would be like niche magazines in the publishing industry that are going out of business. So I don't know what you would cut out.

I think as a public policy the Parliament of Canada can choose to change the act and say we want you to do this and not this. I think it would be a very difficult set of choices. Everybody would have their own view, I'm sure, so I'm not sure how you would get a consensus or a parliamentary majority to agree on what it is you want to get rid of or what you want to add.

Senator Unger: Do you see a real need for cooperation between the Government of Canada, whoever the Prime Minister is, and the CBC?

Mr. Young: The CBC is an arm's-length broadcaster and has to stay that way. When I was referring to those four particular prime ministers, I don't think they had an axe to grind with the CBC. It's just the CBC is one of those things that when you're in government it can sometimes be a bit of a nuisance because it has a news service and not everything on the news is what governments want on a day-to-day basis, quite naturally.

I think at a functional bureaucratic and financial level, there has to be cooperation and I suspect there is. The Treasury Board would meet with the appropriate people and so on. But from a policy point of view other than the Broadcasting Act directions, it's very important that CBC/Radio-Canada be distinct and separate.

I only know one member of the current board of directors. Having looked at them and their biographies, I'm satisfied that they're a very talented group of people and meet a broad ranging representation of the country, both geographically and in skillsets. I think they're quite capable of dealing with the government where it has to be done, but they do have to be careful not to become part of the government. This is a public broadcaster not a state broadcaster.

Senator Unger: Given the challenges that they face with the new and rapidly developing technologies and the fact that money is an issue — there are not unlimited funds — do you think that the CBC is still viable?

Mr. Young: Oh, yes, it's viable, but it may not be viable doing what it does today. It may, of necessity, end up cutting things because it reduces itself, and in part it's doing that now. Instead of showing 16 or 13 episodes, you'll show 12; or instead of producing 90 minutes of supper hour news across the country, they'll reduce it to 60. There will be things like that that they'll start to do.

On the other hand, they're doing new things. There are multiple music channels; there's live streaming, which is cost-efficient because it's a new way, a new platform to get your programming out and it gets you a bigger audience. For example, if you watch the CBC national news or "Téléjournal" on the various platforms that are available, from TV to your BlackBerry to your computer, the total audience watching these shows is going up. Watching it on any one single platform may not be as large as it used to be the old-fashioned way when you had one or two television channels.

Senator Unger: Thank you.

Senator Cordy: Thank you very much, Mr. Young, for being here this afternoon. As usual, your comments are well reasoned and very thought provoking, but I'm not surprised with that.

You spoke about where the CBC wants to be next year. Do you have an idea of where CBC should be in five-years' time?

Mr. Young: If I had my druthers, I'd get rid of transmission because it's very expensive. This is more difficult to do than it sounds. It's easy to say that if you're in downtown Montreal, Halifax or Toronto. It's a little more difficult if you're in Churchill, Manitoba. Geography is one of Canada's most interesting challenges for broadcasters particularly. But the more they can get online to cut out that distribution cost, the more they can save, tens of millions of dollars, that they can then free up for programming.

Again, you need some investment choices to do it. You have to make sure you're ready to go online; you're ready to livestream; you have the opportunities. It's simple for me to say that, but I think as an objective, I would say get out of transmission because you want to produce programming and you want to use the various avenues to get those programs to people. The conventional transmission network for television is becoming less and less relevant. For radio it's still necessary. You're still going to have radio transmission, but radio transmission is a heck of a lot cheaper. Over a period of time, the more they can get out of transmission the more they can focus on programming. For example, they're getting out of many of their big buildings, as they are here in Halifax. They are concentrating on lower and lower overheads and focusing more and more money to the programs you see on the air or hear on the radio. The more they can do that the better off they are, and I think they are going in that direction.

The difficulty will also be a political one because if you start shutting down transmission, for example, in Gander, Newfoundland or northern Saskatchewan or northern New Brunswick and say, "Let's just go on the cable channel or go online," people are going to say, "Well, I paid for this and I'm entitled to get it off air." The reality is the changing technology. We're going from a horse and buggy to a car or from a railway to an airline, and I think the old railway track, which is the transmission system, it's time to get rid of it.

Senator Cordy: We heard this morning from one of our witnesses that the CBC is obese and if it doesn't slim down it's going to wither and die. Would you share that sentiment?

Mr. Young: I don't think it's obese now. No, I don't think it's obese. To slim down — I'd be curious to know what they mean by that. Fewer and fewer people are working there, so it's obviously a lot slimmer. They buy more and more productions.

Most of the stuff you see on CBC, like "This Hour has 22 Minutes," is produced by independent companies. They're not produced by the CBC. The French network does more in-house, but even Radio-Canada is sending more and more out.

I think there's a methodology about the CBC that no longer exists in many ways, when you used to have a radio reporter, a TV reporter, a French reporter and an English reporter. I saw something on the news from China where the reporter was filing for both radio and television in French and English — one guy. Twenty years ago that would have been four guys or four girls; mostly guys, I would suspect.

I don't think it's obese. I think that's an easy cheap shot you can make of any organization that's funded with public money. I don't think the evidence would support it.

Senator Cordy: One of the things that you haven't spoken about and we haven't asked you about is transparency with the CBC. You were on the board of CBC for 10 years. There are significant dollars going into CBC, so what should the expectation be of transparency of operations or salaries or positions, those kinds of things? I can see that some things shouldn't be transparent because of proprietary reasons or just because of CTV, Global — competitors. What should be transparent and what should be open and what shouldn't be open?

Mr. Young: On balance, the more you can have that's open the better, I think, particularly in this day and age. I don't think you should get into individual salaries — that's privacy. I think you can do it by classification. I think the president's salary and those of the board of directors obviously should be public, clearly. But you don't want to start publishing the salaries of performers or announcers. They have a right to privacy just like the rest of us. I think you can do it by classification if you wish: "We have 10 people making more than X or 50 people at Radio-Canada doing this or 70 people at CBC doing this." I think you can do that in terms of salaries.

There's a lot of room for publicity in terms of the overall financial aspect: How much are you paying out in lease payments? How much property do you own? What's the value of it? What kind of money are you spending on new equipment?

I think it's more difficult to ask how much they are paying for a particular TV show because that gets you into the realm of competitive environment. But I think you can say that for prime time drama this year we have five shows on the air and we're spending $10 million a week or whatever.

I think, on balance, if you can figure out a way to make information public that's relevant, you should.

Senator Cordy: Thank you.

The Chair: You talked a few times about the challenges of revisiting the Broadcasting Act. It was paragraph 6891, I think. Yes, it is complicated, but don't you think that we should given the changing environment? They didn't have iPads when they had the Vancouver Olympics. During Sochi, people were listening to the Olympics on their iPads and on their iPhones, which is a very different environment, and the revenue stream was different. But the Broadcasting Act was written in 1991and we're asking the CBC to live under those rules when the environment has changed completely. Should we not face the challenge of trying to change the Broadcasting Act?

Mr. Young: I think it would be a good idea. The nice thing about the Parliament of Canada is that it has elected people in the House of Commons and the Senate has a sober second thought function. I think a little sober second thought, combined with a little public will, comes in very handy.

I think the Broadcasting Act should be revisited. Obviously it is out of date. As you can see from the recent CRTC hearings, the regulatory changes can't keep up with the changing technology. It's very difficult, in the absence of a thorough analysis, which a new act would require, to figure out, what is the strategic change happening here as opposed to what is a change for the moment.

You know, iPads may even be a transitory technology. I can remember when we had 8-track and I remember when we had a VCR. We all thought they were God's gifts and all of a sudden they're redundant. So technology will continue to evolve and, because of that, I think the Broadcasting Act should be revisited in the context of understanding that whenever the new act is passed it has to have an internal coherence that will allow it to adjust over time to the changing technologies that will confront both public and private broadcasters.

The Chair: On governance issues, you were there with a few presidents. You were named to the board by the cabinet.

Mr. Young: The government.

The Chair: And while you were there you were told a few times, "Here's your new president." You did not participate in that choice?

Mr. Young: No, we didn't, and I thought that was wrong.

The Chair: So amongst changes of the governance issues between today and what CBC should be in the future, you think that that's something that should be in the report? We're looking for recommendations that we're going to be able to express at the end of our report.

Mr. Young: From a governance perspective, fortunately all of the governments of Canada have been very successful of appointing qualified people to run the CBC, and that includes the current government. They've appointed some very capable people to the CBC. But I do think with regard to the board of directors, if you are to function like a corporation, it could use a restructuring in the governance sense so that it would have a chance to select a president and then have control over the president, rather than the other way around. I think that's a governance change that would make it more like the conventional Canadian corporate structure.

I'd also tie that to my earlier comment about coming up with some way to allow the CBC to obtain capital investment, whether with the approval of cabinet or through some mechanism, to allow a board of directors to run the company like you would run a normal company. I think those two changes would be most useful.

The Chair: If we look at you as a lawyer and ask you to write two or three recommendations that you think this committee should include in its report, not billable — and, again, we're still going down the pipeline and hearing from other witnesses — what would they be? When we started this study, CBC had a perpetual right, we thought, to "Hockey Night in Canada." A $4.5 billion investment by Rogers changed that and it totally changed the advertising environment and the Saturday night budget for the CBC. So a lot of things might be happening over the next few weeks and months. But if you were to make two or three recommendations that you think should be included in a Senate report on the future of CBC, what would they be?

Mr. Young: One would be the comment I made earlier about coming up with a strategy that would see them get out of direct transmission off air for television, in particular, in order that those monies could be rechanneled into making programs or buying programs from independent producers, so that they spend more and more of their money focusing on the end product rather than on the process of getting the end product to people. Because modern transmission, as you point out, through digital means is a very efficient and cost-efficient method of transmission. I would do that. That, combined with the reduction in their facilities, which they're going through, would free up monies to put more product on the air, which is what the CBC should be focusing on. To be fair to them, I think they try.

Second, I would go back to the governance change. I do think you should want to structure the CBC like a corporation that you can hold it accountable as a corporation and make sure that it does comply with all sorts of transparency rules. So you would have a board of directors that could select a president using the traditional methods of corporations and search capacities. Combine with that some sort of fiscal arrangement that allows the board of directors to make decisions that can affect the corporation over time, as opposed to just doing the annual budget and trying to make sure you break even every year with your day-to-day stuff. Make it less like a civil service department and more like an independent corporation, but hold it accountable at the same time.

The Chair: I have one additional question that I should have asked at the beginning. You used to chair the pension fund of the CBC. It has probably changed since then, but as an outsider, would you think that it's a healthy pension fund compared to what you've seen in the private sector or in other public institutions?

Mr. Young: Yes. We restructured it. We had a man by the name of Stephen Jarislowsky as an adviser for many years, and I'm sure you know who he is. We became what was known as a first quartile pension fund. In other words, we were among the top performers in the country. We actually voluntarily increased pensions retroactively to people who had been around for a long time who had very low pensions. Unless things have substantially changed, it's a very well run, independent, trustee pension fund that does not require public funds.

The Chair: Any additional questions colleagues?

Mr. Young thank you very much.

A very forceful presentation and we thank you for having received us here in the wonderful city of Halifax.

Mr. Young: It's a pleasure having all of you. Stay as long as you wish.

The Chair: Well, Senator Cordy will accept that invitation.

(The committee adjourned.)