:
Mr. Chair, members of the committee, thank you very much for inviting us. We welcome all efforts to clarify the role of public broadcasting.
With me today is Sylvain Lafrance, executive vice-president, French services; Richard Stursberg, executive vice-president of CBC television; and Jennifer McGuire, acting vice-president of CBC radio.
Let me get straight to the point. Canadians could be much better served by their broadcasting system and their public broadcaster.
[Translation]
The broadcasting environment is currently undergoing major changes. We believe this new environment requires a new agreement with Canadians. New ground rules must be established that take into account this new reality. However, I am pleased to confirm for you that CBC/Radio-Canada today is in excellent shape.
Let's start with the traditional media. For a decade now, our radio services have experienced sustained growth in both the size of their audience and the fidelity of their listeners. They have improved the quality of their programming and practically won the most prestigious broadcasting awards, not only in Canada, but also internationally.
Over the past four years, Radio-Canada television has achieved both public and critical success with such innovative programs as Les Bougon and Tout le monde en parle. This success has not gone unnoticed. It is not an accident that Radio-Canada is ranked the fourth most admired business by Quebeckers, according to a survey published by Commerce magazine in March of this year.
Radio-Canada television is approaching a difficult balancing point between programming for the general public and the programming of outstanding quality that is expected from a public broadcaster.
[English]
Even English television, which faces the greatest challenges among all our services, is on the move, with a new management team and a bold plan. Faced with ferocious competition, market fragmentation, and change in consumer behaviour, CBC television has maintained a stable prime-time share over the last four years of between 7% and 9%. That is in the same neighbourhood as Global TV, and more than double the largest specialty services.
This past season CBC had 15 of the top 20 Canadian shows in terms of audience size. Both Radio-Canada.ca and CBC.ca are among the country's most visited media sites. At a rate of more than one million downloads per month, CBC/Radio-Canada is one of the leaders in podcasting in Canada. Interestingly, some of our most successful podcasts are our most serious shows, like
[Translation]
Les Années lumière, Les premières à la carte,
[English]
Ideas, and Quirks and Quarks, and they are being consumed mainly by 18- to 34-year-olds, putting the lie to the belief that you need to dumb down content to reach a younger demographic. The fact is that new technology opens new audiences for existing content. CBC/Radio-Canada is doing well across the board despite an unpredictable playing field.
A few years back this committee urged us in its report, “Our Cultural Sovereignty”, to look at how we can better serve Canada's regions. We submitted to the government our first comprehensive plan in the fall of 2004. Having had no take-up on that plan, we recently submitted to government a more modest plan that focuses on bringing local radio programming to the eight million Canadians living in centres that do not have local CBC radio service.
In the meantime, technological advances are enabling us to rethink our local news offering. Our plan is not to replicate what the private broadcasters already do. We believe that by aggressively managing our budgets and using technology in new ways we can connect with grassroots communities, and at the same time counter the trend in the private sector of a gradual withdrawal from local news.
I mentioned our efforts to manage our budgets. You should know that over the last seven years we have become much more efficient and focused. We have generated $75 million in ongoing annual cost savings, and last year we generated more than $93 million in non-advertising revenues through everything from merchandising to better use of our real estate assets.
That in itself is a remarkable accomplishment, yet we continue to face serious financial pressures. The plain fact is that if these pressures are not addressed—seriously and soon—there will be no more rabbits to pull out of the hat.
Some still ask the question: Is the CBC delivering value for money? Our answer is yes, absolutely.
[Translation]
According to the Groupe Nordicité study of a sample of 18 industrialized countries, which we tabled with our brief, Canada is where the need for a public broadcaster is the greatest and where the system is the most complex. However, Canada ranks sixteenth in terms of the amount of public funding it receives: less than half the average of $80 per inhabitant. The BBC, which provides service in only one language and in only one time zone, has a budget of $7.3 billion. By comparison, Canada pays $1 billion to its public broadcaster, $30 per capita, to provide services in both languages and to cover five and a half time zones.
[English]
We need an explicit contract. The BBC operates under a royal charter that is formally renewed and financed after every decade for the following ten years. This is the kind of clarity and predictability we seek. Anything less is really paying lip service to the ideal of public broadcasting, while watching it wither.
You might ask, what's the rush? Well, in 1997 Canada didn't have 100 digital specialty channels and 100 more foreign satellite channels or 17 pay-per-view and video-on-demand services. Canadians watch TV and listen to radio not on their laptops or their BlackBerrys or their cellphones or their iPods.
In 2004 there was no satellite radio. In 2005 there was no YouTube; in 2006, no iPhone. Canadians want their programming when and where and how it suits them. CBC's future is as a content provider that is “platform agnostic”, not as a television company or a radio network. This is the single reality that is already significantly transforming CBC/Radio-Canada.
So the extent of change is one reason for urgency, and, frankly, the speed of that change makes not reviewing our long-term goals and strategy an unacceptable risk financially, culturally, and politically.
Some people will tell you that public broadcasters aren't needed in an age of choice in technology. If ever that was true, it is isn't now. There is near unanimity on the importance of the role of Radio-Canada in the role it plays in enriching the cultural and democratic life of our francophone community. In French and English, the simple fact is that there are some things private broadcasters either cannot or will not do, but that only we can and will do, such as: Canadian programming in prime time on television; commercial-free, safe, entertaining programming for kids; connections in the north and other remote areas of the country; original current affairs programming; Canadian perspectives on international events; and others that we have listed in our submission. These are the things that others are not in a position to do.
Then, there's the issue of diversity. In Vancouver today, two companies own virtually all the mainstream media on all the platforms. Diversity of viewpoints is disappearing. Canada needs to ensure that those views and voices are heard, and that too is a role for the public broadcaster.
The demand for both quality and diversity of product has skyrocketed, but funding is a real challenge. CBC/Radio-Canada has not received a permanent increase in its public funding base in the past 33 years, since 1974.
I want to thank Minister Oda for her announcement yesterday of the $60 million of additional funding for programming for the next two years. It is essential and it will be well used.
More broadly, as you know, the funding model for commercial television is also seriously at risk. What we need is a long-term, properly resourced strategy for broadcasting for the next decade. We need to engage Parliament and Canadians in a planning process to address the big policy issues, questions such as these: does Canada need quality Canadian programming in prime time; do Canadians want programs that reflect their reality?
Television drama is the most pervasive catalyst of popular culture in western societies. In the last 20 years, every other industrialized country has used its national broadcaster as the anchor in repatriating its prime time schedule. Everywhere else, homegrown drama is the most popular viewing option during prime time.
[Translation]
Another question that arises is how to present international events from a typically Canadian viewpoint. CBC/Radio-Canada already has an extensive network of foreign correspondents relative to other Canadian broadcasters. Should it increase its international presence?
We can also wonder how to promote the cohesion of one of the most diversified societies in the world. How can we support Canada's identity in a world where diversity and fragmentation are the norm? How can we manage to create a sense of belonging and of national pride? In addition, how can we urge Canadians to advance the principles of democracy?
Our radio stations distinguish themselves by their commitment to serve as fora for pan-Canadian debates. Whether it's with Christiane Charette, The Current, Cross Country Checkup or Maisonneuve en direct, our radio services are at their best when they provide a gathering place for all regions, in a single exchange.
[English]
In television, the private conventional broadcasters air little if any current affairs and documentary programming—collectively, 70 hours per year on the English side and less on the French. CBC and Radio-Canada both air literally hundreds of hours per year, and that is not including what we air on CBC Newsworld or RDI. Who else will do that?
CBC/Radio-Canada is in fact a public-private broadcaster in terms of its funding, and a public broadcaster in terms of its mandate. Given our mandate and our funding levels, we must find commercial funding sources to maintain our services. Is that the government's wish? This whole issue should be carefully thought out and planned. We need to strike the right balance.
Today, the CBC is at a turning point for which no one-year answer will suffice and no one-dimensional response will resolve. What is required for CBC/Radio-Canada to reach its potential as an instrument of national policy is a new contract with Canadians. Like all contracts, this would lay out the obligations of all parties, and would have a specific term of say ten years. Such a contract would provide guidance on the big questions I have raised above. It would be based on the principles already enshrined in the Broadcasting Act, and serve as the basis for a clearer contract and mandate with our 32 million shareholders. A fundamental principle that underpins any contract is that sufficient resources be provided to be able to meet the expectations set out in the contract. Frankly, if the money isn't there to fulfill these expectations, the contract will fail.
It is our clear hope that this committee will see in the idea of establishing a permanent process to review CBC/Radio-Canada's mandate the opportunity for Canadians to renew their relationship with their national broadcaster and to clarify, through a contract, how Canadians can best be served.
[Translation]
Thank you. We are now ready to answer your questions.
Thank you for your testimony this morning. We appreciate your coming to share with us and to start down the road of reviewing the mandate of CBC as it currently stands, how we might adjust it in going forward, and at least where we might suggest changes in going forward.
Obviously CBC plays an important role in protecting our cultural sovereignty. I think all Canadians recognize that as Canadians we have something special to preserve here in Canada and we want to maintain it. CBC plays an important role, and we thank you for that.
We thank you for maintaining fiscal responsibility in the last number of years. You've maintained not only your entity but cultural sovereignty as well.
On going forward, as you pointed out in your testimony, it would come as no surprise to anyone in the country that as we move forward, we're facing all kinds of obstacles in terms of new technology and folks being able to go to other places for their media. Of course, there are hundreds and hundreds of new channels coming on stream in any given year.
I'll tell you a story. I'm a huge fan of CBC radio. It's the only talk radio in our area, and most people who listen to talk radio listen to CBC radio. Over the last number of years, I have an informal group of friends with whom I always know that if I want to talk about CBC radio or something I've heard, I can target them and ask if they've heard the story on As it Happens or what not. In the last number of years I've found that as I've approached those same friends, they've said they have new satellite radio programs and are listening to something else. I've seen it happen increasingly in the last year. I'm kind of surprised by it, but the unfortunate part is that the people who are listening to other talk radio programs aren't necessarily listening to anything Canadian.
It concerns me on a couple of levels. One, I'm concerned about the future of CBC. Second, I'm concerned about the cultural sovereignty we have in this country. Of course, we have to address that.
I hope that as we move forward on this mandate review, we can come to some understanding and some way to drive people back to things that are Canadian and back to the resources we have through the CBC. But I'm really concerned about how we'll do it.
I've talked informally to people. It seems to me that when I've talked to people, they say they go to the CBC for niche products. They go for Hockey Night in Canada. They go for regional news or whatever. As we see competitors taking up those things, I'm concerned that we're not going to have a niche product.
There are places where the CBC can identify niche products they could provide for Canadians that nobody else can provide. You have identified some. You've identified prime time drama as possibly being one of them.
To be honest, I'm not sure it's going to be a wholesale conversion, particularly for young people. I'm not sure it is going to draw them. I've talked to young people. They are more interested in reality TV shows. It's not something I subscribe to necessarily, but it's something they want to see a little more of. Maybe we could have some Canadian content in something down the road.
What are the niche programs or the niche products? Specifically, I am looking at the English side, because I know the French side has some of those niche products. When there is huge competition from our southern neighbours, on the English side, what are the niche areas? Of course, Hockey Night in Canada has become somewhat of an uncertainty. Where are we with that? On moving forward, what are some of the other niche products?
:
I'll just say one thing. Obviously, what the president said is right. It's not our job to tell Canadians what values they should espouse. Our job is to reflect the full diversity of view within the country.
We were talking about regional before. When we think about regional, I try to think about it in a different way. It's not just that if we do a newscast, we see Calgary or we see Halifax. It's rather that what you want reflected on the national news is the perspective of Calgary or the perspective of Halifax, so that the full diversity of voice of the country, whether it's a regional diversity of voice or a political diversity of voice or a social diversity of voice, is fully reflected on the network.
One of the things we're doing—and which implies, I think, actually a decentralization of the way in which we've approached these kinds of questions in the past—is to put a new emphasis on rebuilding our local and regional presence, but to do so in a way that allows Canadians to participate more effectively in commenting on the news as we provide it, and indeed in helping us determine what the priorities for news coverage should be. With this concept that the president was referring to, called “My CBC”, which we're trialing right now out in Vancouver, we've said to ourselves, “Let's take the totality of our assets—radio, television, online—and let's put them together to create an integrated news service that works in a way to let Canadians can get their news whenever and however they want it, but equally importantly, let's use the power of the new technologies to allow Canadians to participate much more profoundly in the conversation about what constitutes the news.”
And this goes by different kinds of names. Some people call it “citizen journalism”, but what it means is that we use the website to allow people not just to comment on what comes through the news, not just to engage in dialogue with our own journalists as to what they see and the extent to which they think it's accurate or fair, but beyond that to allow them to tell us what it is that we are not covering that they think is important, and beyond that, to say to people that we would welcome their contributions to the news service itself, so that we can create opportunities for them to be able to upload what they think, whether that's in the form of video or voice.
We would like to get rid of the notion that we had in the past, when people thought that “We, the news, tell you what's the news”. That's completely old school. We want to flatten it completely, so that the news essentially becomes a dialogue between citizens on what it is that matters and how it is that they see things. We then become, in some sense, the mediator of that dialogue.
I want to apologize for being late. I waited three-quarters of an hour for a taxi this morning.
I've tried to ask a clear question: what would you think if there was no more CBC? What we've heard from every sector is that the CBC is extraordinarily important to Canadians. Their concern, however, is that you are not getting to them any more, and of course that has to do with the new digital mode and not having the infrastructure to get there. In many instances you've had to cancel where you were going because people have to tag on to cable television to get there.
We've heard over and over that people think you're doing a good job with what you have, but that you must move into the regions in a different way; that you must reflect Canadians back to themselves, especially from the regions to the nation, as well as from the nation to the regions. You're not doing as well from the regions to the nation as you could. People have all said one important thing: the CBC must be funded appropriately.
We've seen the reports and know what cities have studied, etc., that have basically said that we're way down the ladder. Given that Canadians support a public broadcaster, given that people say that you need to have more money, would you see the CBC working well and differently if it were given better funding? Would it actually work in the way that the BBC has done, if you changed your system of reporting, to have direct responsibility to Parliament, with a specific trust that would look after much of how you function, so that you could be far more accountable for the money you have and go to Parliament, not necessarily to anyone else, so you could get the feedback from Parliament, so every year you would be able to table what you're doing?
People also thought you needed to focus more. Many feature film people said that you, the CBC, could be the distributor in the digital medium for Canadian feature films, for Canadian documentaries, and for Canadian performing arts, which, as you know, has been cancelled and was a well-watched section of what the CBC used to do.
I want to know what your comments are on some of those things.
:
That's fine. I'll try to comment on some, and perhaps my colleagues will add, as well.
What I find comforting, if I can use that word, in what I understand of your hearings so far, is a growing recognition that you just can't say to the CBC, “do more”. I think there's a growing recognition that we are stretched as far as we can be stretched, and if we were to do more, in fact we'd do less. Something would have to drop off our schedules and off our approach. And I haven't heard much in terms of people saying that we should get out of this or that in a reasonable way, because whenever I hear it, I don't hear them telling me how I'm going to get the money that X or Y generates for us to continue to do what we're doing.
That I find very reassuring. As I said in my introductory comments and in the paper we have tabled with you, I believe that we are at a crossroads. We have done ad hoc hearings about the CBC every three or four or five years. I believe it is time, and we believe it is time, to structure that into a contract, and that contract, like all contracts, will have clauses and expectations: this is what we expect, we would say that this is what it costs, and there would have to be an agreement. Or if we think it's going to cost x, but you can only give us half of x, well, then there would be an agreement that we would bring it in at a particular speed.
But I fully accept and think that it is eminently logical for the government and Parliament to define more precisely what it wants from its public broadcaster—and in a contract—and then you go forward with that.
I dare say that the BBC has exactly the same thing, and if you look at the contract, it has changed with time. The current contract puts much more stress on light entertainment, and one of the phrases they use is that a public broadcaster need not be boring. The BBC contract also calls for them to decentralize certain operations. The contract also calls for them to buy more from the independent sector and produce less in-house. But this is fine. This is part of defining where you want us to go.
So my answer to you is that this is the debate and the dialogue we must engage in. And it's not something that can be done overnight. It's something I think we would have to work on together and it would involve the Canadian public.
But I must say, the core for us is the programming. The core for us is getting the programming out to people; that is, with the new technologies and transmission systems. But without the programming, without the funding, we have nothing to put in the transmission systems. What's the purpose of a pipe if it's empty?
:
Maybe I'll start, in terms of the English markets.
Clearly, in terms of where we're going, we completely agree with you that what we need to do is develop all of our content from the very beginning so that it fits with all the potential platforms on which it can be viewed or seen, and what we want to do is be able to monetize that.
What we inside the CBC have done is completely transform our development process to make sure that from the very moment we think of a project, we think about it in terms of all of the different platforms on which Canadians might want to see it.
Obviously, where this becomes a little bit trickier is when we're dealing with independent producers. The news and what not we make ourselves, but when we're dealing with independent producers, it's another issue.
I know that the Canadian Film and Television Production Association came down to see you the other day, and they said that they thought we were a bit tough on them in terms of wanting to get these kinds of rights for other platforms over and above television.
What we actually proposed to the producers' association originally, when we first began discussing this matter, was, “Look, you know, the problem with these new platforms is that nobody actually knows what they're worth. We don't know because it's early days. So why don't we do this...”—to your monetization point—“Why don't we enter into an agreement between the CBC and the producer of the program that for all those other platforms, we will act as your distributor? We'll distribute when there's a video-on-demand offer, whether it's a mobile offer on a hand-held or a cellphone or whether it's an Internet offer for the show. We'll work with you to make sure they get good distribution. And what we'll do is split the revenues fifty-fifty and off we go. Let's do that for a short period of time until we can see how the market settles down and what these platforms are really worth.”
We thought that was a terrific offer, because what's going to drive all of the new platforms is, if you like, the great bullhorn of television, which is the dominant platform and will remain the dominant platform for the time being. But that way we could share the risk associated with going forward, and at the same time we could share the revenues.
They declined this proposition. And I think, frankly, this is unfortunate, because I think what it will do is slow our capacity as a country to develop Canadian content for those new platforms.
:
We have the same problem in the French world.
[Translation]
In French, this question of rights is really fundamental. It is complex, first, because it concerns the international aspect, a lot of rights holders, but also because it concerns the Canadian Television Fund, for example, which itself sets certain rules and certain limits. The Canadian Television Fund has somewhat come to a point where it arbitrates the relations of producers and broadcasters, to the point where, when buying a licence for a new series, we aren't entitled to discuss any other rights. That's a bit stupid and, in my view, somewhat provokes what is called the problem of high-cost series in Quebec, that is to say that the broadcaster is nevertheless the trigger of major series. In other words, if there is no Radio-Canada, TVA, TQS or another major television network to create a series, it won't exist.
So we can't enjoy all the rights. In any case, we aren't entitled to discuss them at the outset. We therefore invest less and less. So, at some point, these series will no longer exist. I think that time is having its effect, because, technologically, we won't have a choice to change these practices. This will have to change because the broadcaster has made much too big an investment to be content with only one or two broadcasts.
So this question of rights is fundamental if we want to protect content, and the television industry has nevertheless had major success in Canada. To protect content, we will have to find a way to agree with all rights holders, including independent producers.
:
To that point, Mr. Chair, I was here seven years before I realized there was a chair.
I have three points I'd like to make. First of all, in the context of the CRTC review and your representations to the CRTC, I know that in a submission in 2006 there was a reference to the fact that in terms of investment we had to look at forward-looking investments, rather than panicking with the declining over-the-air numbers and making choices.
I need you to elaborate on that. Where are our priorities here? I think it's critically important to understand the relationship between the traditional world that I engaged television with and the world that my one-year-old son is going to walk into. Where do you fit? You need to elaborate, because a lot of people are scared of that comment, as you can well imagine.
Second, in terms of the mandate itself, I think there's a great deal here that speaks to the regions, that speaks to our diversity, that speaks to language, to the north, and so on. Given all the inputs available, would it be advisable to deal with a chronological piece of the mandate?
In other words, with all the offerings available, the other elements of this mandate to affect the minds of Canadians and to affect the impression of Canadians of their own country and so on are clearly there, but if nobody is accessing it, it's hard to do that. Maybe a mandate has to see you involved in schools, see you involved in a different way, so that people have exposure. I'm only 52; there were only two television stations for most of my formative years, so this piece worked well then. Now it's very different, and maybe there have to be more creative ways to be there for people, to engage them in the public broadcaster and so on. I'd be interested in that.
The other one is there's a large elephant in the room having to do with funding. As a member of previous governments that took decisions that negatively affected the resources available to the CBC, I think we must all try to get past it from a political context so that we can actually do the right thing by the public broadcaster. I appeal to all members to allow that, so that we don't get into silly debate about it. I know it may be self-serving, but there are both sides to all debates. I think it would be a waste of time for us to get too engaged in that. We should simply deal with what it is we wish to see from the CBC and how it may wish to reposition itself in some ways to deal with new realities, and I go back to what I said.
I would also really like you to clarify or elaborate on the earlier representation to the CRTC on where the various media fit.
:
With respect to over-the-air, when we talked to the CRTC we were very cognizant of the fact that we have 650 transmitting towers for television alone, plus radio as a separate item, and that these towers are aging. They were built mainly in the 1970s, and they were built to serve all communities of 500 or more. It was a government policy called the accelerated coverage plan. We knew that this was a system that was perhaps designed for a different era, an era when the bulk of people got their television over the air.
The fact is that now, basically 90% of Canadians, give or take a couple of percentage points and depending on who's doing the calculation on any one day, choose to pay to get their television via satellite or via cable, primarily, and very shortly we'll have more delivery by the telephone companies. In the process a very unique thing has happened. The regions that were les régions défavorisées, the regions that were underserved in terms of television and maybe only had one channel, are now the ones that are getting the multitude of channels via ExpressVu or Star Choice. Where people choose still to get their television off air, the bulk of them are in urban communities. They are in urban communities and it's a conscious decision, or a financial decision, on their part—conscious because maybe they don't watch TV, maybe because getting over-the-air CBC and CTV is more than enough for them because of the amount they watch, maybe just news. But it's generally speaking a conscious decision to get their television over the air.
We had no suggestion from government, nor were we certain it was the correct policy, that all those 650 transmitters be replaced. It's a very expensive undertaking. With 42 transmitters, as we move to the digital era and move to HD, we can cover 80% of the population over the air, and the bulk of the people who have chosen not to take television by cable or satellite. So we're not depriving people by saying this is a rational business model. If the government wants us to go all the way, we're more than willing to do it.
If I were to be asked for advice, wearing my old bureaucrat's hat as a policy advisor, I would suggest that perhaps there are better ways to spend the money in broadcasting than to replicate an old system and again get tied up in transmission rather than in program production.
So when we went to the CRTC we went with what we thought was a responsible way to deliver HD over the air to 80% of the population. I must say, TQS said they were going to build one transmitter for HD, at most. In many ways, others are very concerned about the cost of that. So that was the essence of our presentation, trying to be reasonable and rational, given the economic situation within which we live, and given that our priority still is, and still will be, programming.
That gets me to the second part of your question, about how we reach out and educate people about the availability of CBC. In many ways that's exactly what the new technologies allow us to do. I jokingly say that sometimes CBC radio, in particular, is an acquired taste. If you're under 50, you're not going to acquire it. You'll acquire it with time. The fact is I'm wrong. I know it from my own kids and their friends. There are a lot of younger people who like and are attracted to CBC radio, and we're proving now with iPods and downloads that there are many ways to get to people, in English and in French, through the new technologies. I think that's what we have to do. We must be involved in all the new technologies. Some are going to fail, no question. Some are going to be overtaken by other technologies. But we must respond to Canadians and say you can get that program when you want to see it, not when I tell you to see it. I think in that way we will continue to build an audience for CBC in the long run.
If we're not in those technologies, we will lose. If somebody wants to watch an Olympic result on their little cell screen and they want it immediately, we have to be there. We were there in the last Olympics, and both the cellular provider and us were ecstatic at the number of new people who actually tuned in just to see the event, and then moved on or then saw it on a big screen.
What you say in terms of funding is the dream I have that we could, with all of you, define what you want from the public broadcaster, what the holes are in the Canadian system. I believe, for example, drama is a tremendous hole. Service to les communautés francophones hors Québec is an extremely important service that we must do, if we believe in how this country is going. But that is something to be defined beyond just the Broadcasting Act and to be defined in a regular manner, I say every ten years. That means that at the seventh year, you begin to evaluate us and go forward.
But a contract has two parts to it. Part one is what is expected, part two is how it's going to be paid for. The two must merge together. The only way I can see this happening in the long run is for all of us to do it together.