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37th PARLIAMENT, 2nd SESSION

Standing Committee on Canadian Heritage

EVIDENCE

CONTENTS

Tuesday, December 3, 2002

0905

The Chair (Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.))

Mr. Martin Mittelstaedt (President, Communications, Energy and Paperworkers Union of Canada)

Mr. Peter Murdoch (Vice-President, Media, Communications, Energy and Paperworkers Union of Canada)

The Chair

Mr. Peter Murdoch

0910

0915

The Chair

Mr. Martin Mittelstaedt

The Chair

Mr. Peter Murdoch

The Chair

Mr. Martin Mittelstaedt

0920

The Chair

Ms. Anne-Marie Des Roches (Public Affairs Director, Union des artistes)

The Chair

Ms. Claire Samson (Chief Executive Officer, Association des producteurs de films et de télévision du Québec (APFTQ))

0925

Ms. Anne-Marie Des Roches

0930

Ms. Francine Bertrand Venne (Director General, Société professionnelle des auteurs et des compositeurs du Québec)

Ms. Solange Drouin (Vice-president of Public Affairs and Director General, Association québécoise de l'industrie du disque, du spectacle et de la vidéo (ADISQ))

0935

Ms. Francine Bertrand Venne

Ms. Claire Samson

The Chair

0940

Ms. Betty Hinton (Kamloops, Thompson and Highland Valleys, Canadian Alliance)

The Chair

Mr. Peter Murdoch

Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance)

0945

Mr. Peter Murdoch

Mr. Jim Abbott

Mr. Peter Murdoch

Ms. Christiane Gagnon (Québec, BQ)

Ms. Anne-Marie Des Roches

0950

Ms. Francine Bertrand Venne

Ms. Solange Drouin

0955

The Chair

Ms. Solange Drouin

The Chair

Mr. John Harvard (Charleswood —St. James—Assiniboia, Lib.)

1000

Mr. Peter Murdoch

Mr. John Harvard

Mr. Peter Murdoch

Mr. John Harvard

Mr. Peter Murdoch

Mr. John Harvard

Mr. Peter Murdoch

Mr. Martin Mittelstaedt

1005

Mr. Dennis Mills (Toronto—Danforth, Lib.)

Mr. Martin Mittelstaedt

Mr. Dennis Mills

Mr. Martin Mittelstaedt

Mr. Dennis Mills

Mr. Martin Mittelstaedt

Mr. Dennis Mills

Mr. Martin Mittelstaedt

Mr. Dennis Mills

1010

The Chair

Ms. Solange Drouin

Mr. Dennis Mills

The Chair

Ms. Wendy Lill (Dartmouth, NDP)

1015

Mr. Martin Mittelstaedt

Ms. Francine Bertrand Venne

The Chair

Mr. Jim Abbott

1020

Ms. Claire Samson

Mr. Jim Abbott

Mr. Peter Murdoch

1025

The Chair

Ms. Anne-Marie Des Roches

The Chair

Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.)

1030

Mr. Peter Murdoch

Ms. Liza Frulla

Mr. Peter Murdoch

The Chair

Ms. Christiane Gagnon

1035

Ms. Solange Drouin

Ms. Christiane Gagnon

Ms. Solange Drouin

1040

Ms. Wendy Lill

Ms. Francine Bertrand Venne

Mr. Peter Murdoch

The Chair

Ms. Liza Frulla

1045

Ms. Solange Drouin

The Chair

Mr. John Harvard

Mr. Martin Mittelstaedt

The Chair

Mr. Jim Abbott

Mr. Peter Murdoch

1050

Mr. Jim Abbott

Mr. Martin Mittelstaedt

Mr. Jim Abbott

Mr. Martin Mittelstaedt

Mr. Dennis Mills

The Chair

Ms. Anne-Marie Des Roches

The Chair

Ms. Anne-Marie Des Roches

The Chair

Ms. Anne-Marie Des Roches

The Chair

Ms. Anne-Marie Des Roches

The Chair

Mr. Peter Murdoch

1055

The Chair

CANADA

Standing Committee on Canadian Heritage

NUMBER 008

2nd SESSION

37th PARLIAMENT

EVIDENCE

Tuesday, December 3, 2002

[Recorded by Electronic Apparatus]

¿ (0905)

[English]

The Chair (Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.)): I declare open the meeting of the Standing Committee on Canadian Heritage.

[Translation]

The Standing Committee on Canadian Heritage is meeting today to resume its study on the state of the Canadian broadcasting system.

[English]

It continues its study on the state of the broadcasting system in Canada. Today our panel will cover two issues: the cross-media issue and foreign ownership.

We are very pleased to welcome in that order, from the Communications, Energy and Paperworkers Union of Canada, Mr. Martin Mittelstaedt, the president, and Peter Murdoch, the vice-president of media.

[Translation]

We also welcome, from the Union des artistes, Ms. Anne-Marie Des Roches, Public Affairs Director; Ms. Claire Samson, Chief Executive Officer, from the Association des producteurs de films et de télévision du Québec; Ms. Solange Drouin, Vice-President of Public Affairs and Director General, from ADISQ, l'Association québécoise de l'industrie du disque, du spectacle et de la vidéo; and Ms. Francine Bertrand Venne, Director General, from the Société professionnelle des auteurs et des compositeurs du Québec.

[English]

We are pleased to welcome you.

We'll open the panel with you, Mr. Mittelstaedt.

Mr. Martin Mittelstaedt (President, Communications, Energy and Paperworkers Union of Canada): I'll defer to Peter, who would like to begin.

Mr. Peter Murdoch (Vice-President, Media, Communications, Energy and Paperworkers Union of Canada): Just so I know, the process here is we will have an opening statement to make....

The Chair: We would suggest an opening statement of not more than ten minutes--shorter if you wish--so that we allow time for questions by the members.

Mr. Peter Murdoch: I will start, and then I'll pass it over to Mr. Mittelstaedt.

Mr. Chairman, members of the committee, I want to thank you for the opportunity to speak with you today on behalf of the Communications, Energy and Paperworkers Union of Canada. CEP has 150,000 members, with 20,000 members in the media. We represent workers at most of Canada's media outlets, from national dailies and network broadcasters, to weeklies and small radio stations.

With me today is Martin Mittelstaedt, who is president of our largest newspaper union local in Toronto. He will be speaking later, particularly on the issue of foreign ownership. I'll begin by addressing a few comments on cross-media ownership.

At the risk of voicing what's probably an insight into the obvious, I should let you know that the issue of cross-media ownership is a non-starter with journalists, organizations representing journalists, and the public. It affects the quality of journalists' work, their health, competitiveness, and sense of professionalism.

Our union conducted a national poll this summer, which I'm sure some of you saw. It showed overwhelmingly that Canadians were deeply concerned about the concentration of ownership in this country and expected the federal government to do something about it. Cross-media ownership is an essential part of that concentrated landscape and is part of the concern Canadians share.

Ownership, which flew the flag on the need for increased resources in a global marketplace, managed to buffalo both government agencies and their shareholders into the cross-media ownership scenario. We said it wasn't sound at that point, and we are still saying it. Today, the evidence is sadly pouring in, in support of our and Canadians' concern.

The evidence of undue and harmful influence on editorial policies and practices as a result of ownership over the past few years has been reported and well-documented. Of course, those of you who live and work here in Ottawa are well aware of the Ottawa Citizen scenario. I don't believe there's a need to repeat all the evidence here now. I'm sure it's before you.

Our union hosted a meeting in early July of this year of representatives from journalism schools; journalists' organizations; the former commissioner on the newspaper industry, Tom Kent; public interest groups; a representative of former senior Southam executives; and other unions representing journalists. There was unanimity on the concern of the effects of concentration of media ownership and cross-media ownership. This was a unique meeting in the history of journalism in this country. We found common ground in the great deal of concern over cross-media ownership and the concentration of ownership.

This unique meeting of Canadian journalism should not be dismissed. It was an impressive array of stakeholders in Canadian journalism, with a shared and deeply felt concern about where our craft was headed in Canada.

If you had a group of medical doctors talking about the medicare system, people would stand up and take notice. They stand up and take notice when teachers talk about the education system. They stand up and take notice when nurses talk about the health care system. This was journalists getting together, from every area of the craft. They are deeply concerned about concentration of ownership, which of course is the umbrella of cross-media ownership.

Just as unhealthy as the concentration of cross-media ownership is the cost to employees and information consumers as a result of the debt load these companies amassed in their rush to form these cross-platformed empires. This debt has meant a draining of resources to Canadian news outlets right across the country. This translates into a decrease in information to Canadians. Newsrooms are now operated more with an eye to accountants and annual reports than to the quality of news stories. Communities have suffered the most, as major broadcasters have back-tracked on commitments made at licensing time.

Sadly, this reduction in service has come despite the fact that the stations and newspapers themselves have often been highly profitable. There is no reason at all why these individual stations and newspapers should be facing the cutbacks they have, given their own individual bottom lines.

¿ (0910)

Today, of course, these companies are looking for bailout funding from U.S. capital. Our union believes this would only compound the mistakes initiated when this media concentration was permitted by government, and then would further erode cultural sovereignty.

The move to deconvergence, as your outline of questions phrases it, will not come as a result of reduced enthusiasm for making the most out of new and promising technology, but rather from overextended companies that must sell to reduce their debt loads and to increase their share prices. We believe there will be a continued converging of technology, particularly as the world of what they describe as “computainment” becomes more sophisticated and consumer friendly.

But this convergence will not arrive tomorrow, nor at the rate expected by the wild-eyed dot-com enthusiasts of the past few years. But I believe it will come. As it comes, it will have to be regulated by government, particularly in the area of content and carriage. The computer games, television shows, and even archival research may indeed all stream through the same distributor. But the content, particularly in news and information, must be separated from the undue influence of these carriers and must be able to compete in order to encourage a diversity of voice. Government must ensure that the marketplace of information is not restricted by the actions of a few heavy-handed conglomerates.

What can the government do to get our media back on track? We have a few recommendations. First, establish firm limits to media concentration and cross-media ownership within cities, regions, and nationally. Give corporations a period of five years within which these limits must be made. We note that the Friends of Canadian Broadcasting have pointed you in the direction of the British government for guidance in this matter. We would do likewise, but simply as a starting point.

Two, we would suggest that we establish formal monitoring councils, set up as trustees, with representatives from the public, journalism, and employers, and be at arm's length from government. These councils would act as an avenue to address complaints from the public, working journalists, and consumers. Such councils would have the ability to recommend the withdrawal of tax breaks, should ownership not comply with the decisions of these councils.

Three, we would immediately initiate an independent inquiry into the effects of media cross-ownership and concentration of ownership.

Four, take steps to ensure that broadcasters fulfill their obligations to the communities they purport to serve by adequately supporting news and local-reflection programming.

These simple recommendations are doable without jeopardizing the financial health of corporations or their stockholders. What does jeopardize Canadians is the ever-reducing diet of opinions and news stories—particularly at a local level—as a result of cross-media ownership. This diet is slowly making our democratic society anemic. One of the symptoms is an ever-decreasing participation rate of the electorate in the democratic process—something I believe is close to your heart.

I'll now ask Mr. Mittelstaedt to make a few comments. Then I'll just wrap up.

¿ (0915)

The Chair: Will you allow me a few remarks, please?

Mr. Mittelstaedt, in the interests of time and giving all panellists and questioners a chance—because we have to vacate this room at 11 o'clock, whether we like it or not—I would suggest you give your remarks now if they are very brief. Otherwise, we'll come back to you afterwards.

Mr. Martin Mittelstaedt: All right.

The Chair: You can just summarize them.

Mr. Murdoch, could you let the researchers and the clerk have the results of the poll you referred to? And could you send it in?

Mr. Peter Murdoch: Absolutely.

The Chair: Thank you.

Mr. Martin Mittelstaedt: I'll be speaking on foreign ownership.

I'm president of Local 87M of the Communications, Energy and Paperworkers Union of Canada. Our local is the largest in North America representing newspaper employees. Our members include thousands of editors and reporters, advertising and circulation employees who work at some of the country's best known publications, such as The Globe and Mail, the Toronto Star, the Hamilton Spectator, Maclean's, and the London Free Press. We represent employees at almost all of the major chains--CanWest, Osprey, Rogers, Torstar and Bell Globemedia.

I work as a reporter at the Globe, but I want to stress that I'm here today representing the views of the union and not those of my employer. Indeed my boss, in a recent speech, has called for the opposite of what I'll be recommending today.

We have deep concerns about relaxing foreign ownership restrictions. I want to say at the outset that I'm appalled that the owners and executives of many of the companies where our members work are urging the government to abandon foreign ownership controls. We believe current restrictions should stand. There's no compelling public policy reason for changing them. Indeed, the need for domestic ownership of the media is as strong now as it was when these rules were first drafted by legislators.

The print, broadcasting, and cable media are one of the only remaining sectors of the Canadian economy under the control of Canadians. The high level of domestic ownership exists for only one reason. That is, we have strong ownership rules, whether they be the ownership caps that are on the broadcasting end of things or the favourable tax treatment on advertising. That's one of the main barriers that prevents foreigners from running the print end of the business.

These restrictions have been put in place for one reason: to protect the ability of our people to have a culture we call our own. These rules are more necessary in Canada than in many other countries because of the likely domination that U.S. media outlets would have over our culture and news-gathering system if they were allowed to have open access to our market.

Drop the rules and I think it's likely that most of the cable systems, broadcasters, and newscasters would fall under foreign ownership. My bet is that the CBC would soon be the only news-gathering and cultural institution of any consequence left under domestic control in English Canada.

We believe the call by many in the industry for foreign ownership is caused by a simple reason. Many of the owners and executives of Canada's media empires have been financially reckless. They've demonstrated a stunning lack, a stunning absence, of financial acumen. They've squandered billions buying at the top of the market or in misguided ideas of media convergence and synergies--the embarrassing buzzwords from a few years ago that fortunately we don't hear very much any more. They've loaded their companies up with billions of dollars in debt, and now they're worried about the mess they've inflicted on themselves and they want you policy-makers to rescue them from their folly.

These owners want the market opened up to offshore investors so that they can try to flip their properties for which they recently overpaid, properties they bought knowing full well what the ownership restrictions were in Canada.

We believe the main problem facing the industry executives who have appeared before you is the debt with which they've saddled their companies. What debt really means is that the industry has attracted too much capital, and this capital has had a perverse effect of weakening these businesses.

Cable companies, for instance, have been awash in capital, as signified by their debts and their huge high-speed Internet investment activities. CanWest and Quebecor were both able to borrow billions for acquisitions. These industries are not starved for capital, which is something that I think some of the executives previously have said. The argument that the industry has been starved for capital simply isn't true. The industry might be in even better shape had this capital not been so freely available. It would have forced more responsible investment activity.

We believe the industry is undergoing or is about to enter a period of instability. New Canadian chains are and can emerge in the newspaper industry--witness the activities of Osprey or GTC Transcontinental. Why couldn't the CTV or Global become an independent company again, or an income trust, for that matter?

Maybe the solution to last week's complaints by the cable companies is that they should be allowed to merge with their rivals in the telecom business. The two industries are co-evolving in the same direction and might be better off under the same ownership structure.

The alternative of foreign ownership of the media would be a disaster, I think, for Canadian culture and our democracy. We find it hard to believe that if, for instance, ABC were allowed to take over CTV, the U.S. broadcaster would care about Canadian news content. Would it have a large group of Canadian foreign correspondents seeking to interpret the world for Canadians when their own U.S. correspondents could easily feed their reports into Canada? Would The New York Times, if it owned the Globe, want to keep Canadian reporters in New York, Moscow, or Washington when they have dozens of their own reporters in those locations? I doubt it. I think we would be sacrificed in the next round of corporate cost-cutting.

¿ (0920)

I don't think the Americans see the world we do; yet we'd be constantly at risk of having their interpretations of reality imposed on us. The temptation to use U.S. entertainment content in broadcasting remains, as always, overwhelming and would likely only be greater.

We worry about the foreign ownership also spurring media concentration. Some of the large foreign companies could, if they wished, create conglomerates of truly enormous size in a market like Canada. Why wouldn't a foreign buyer be able to acquire both, say, CanWest and Torstar, to use a hypothetical example, and create a domestic print and broadcasting company of a size that's downright scary and something that would be unlikely to emerge in Canada on its own?

Most of the country's individual media properties are sound. They're good profitable businesses loaded up with too much debt by their current owners. TV stations still have plenty of viewers. I think if companies overpay for acquisitions and must sell at a loss to get their debt levels down, then let them and let their shareholders suffer the consequences. Our cultural industry should not be sacrificed for the problems the owners have created. We work for those people. We know they're not worth changing our ownership restrictions for.

Thank you.

The Chair: Thank you.

[Translation]

Before giving the floor to Ms. Anne-Marie Des Roches from the Union des artistes, I would like to welcome a colleague who has joined us, Ms. Liza Frulla, who has vast experience in the cultural sector given that she was formerly the Minister of Culture in Quebec.

[English]

She was a broadcaster for several years with Radio-Canada, so she comes with a lot of experience in the field we're covering here. We're pleased to welcome Ms. Frulla here.

Thank you.

[Translation]

Ms. Anne-Marie Des Roches, from the Union des artistes, you have the floor.

Ms. Anne-Marie Des Roches (Public Affairs Director, Union des artistes): Claire Samson will speak first. The four associations are doing a joint presentation.

The Chair: Ms. Samson.

Ms. Claire Samson (Chief Executive Officer, Association des producteurs de films et de télévision du Québec (APFTQ)): Good morning, Mr. Chairman, ladies and gentlemen members of the Standing Committee on Canadian Heritage.

Last April, together with three other professional associations, the Association des réalisateurs et des réalisatrices du Québec, the SARTEC, and APFTQ, we presented our common position on several aspects of the Broadcasting Act. Unfortunately, the representatives of these three associations were not available for this hearing, but they would like the committee to know that they support the position that we will be presenting again today and expanding on.

I would like to remind you that our seven associations represent practically all those who are involved in the design, creation, direction, performance, production, and distribution of Canadian works on French-language radio and television in this country.

Thus, we have come back before you today to consider more specifically the issue of ownership in the broadcasting sector. From the outset, we would like to repeat that the principle of effective ownership and control of our system by Canadians is the cornerstone of Canadian broadcasting. Without Canadian ownership of broadcasting companies, it would be impossible to maintain the integrity of the system and its fundamental mission, which is to safeguard, enrich and strengthen the cultural, political, social, and economic fabric of Canada.

We feel that the globalization argument must be demystified. Those who advocate relaxation of foreign ownership rules argue that Canada must join the globalization movement if it wants to progress. We feel that globalization can encourage the development of our cultural industries, but on the condition that the process is undertaken appropriately. In the area of culture, globalization must not simply mean liberalizing trade, with no consideration given to the conditions under which musical pieces, television programs, and other works are produced and distributed. Looking at the trade of cultural goods from a strictly economic viewpoint would be harmful to the fundamental makeup of culture and society.

If we leave this process up to the market without providing any parameters, it will become practically impossible to produce and broadcast content that reflects different cultures. Globalization must be undertaken in a way that allows us to maintain and develop cultural diversity, and that can only happen by maintaining those conditions in each country that allow the production of original pieces of work.

¿ (0925)

Ms. Anne-Marie Des Roches: I will now say a few words on the Broadcasting Act.

The Broadcasting Act meets a need to preserve and enhance national identity and cultural sovereignty. This need still exists in today's context. Our challenge is to find ways of guaranteeing those conditions that allow our broadcasting system to continue to meet the needs of Canadians. One of those ways is Canadian ownership.

In Quebec, the public has clearly expressed a preference for cultural products that it can identify with. When they are available, works that reflect the cultural environment of our public are truly successful. So, programs on French-language television that have the most listeners are domestic programs.

On radio, Quebec and Canadian music make up a large part of the musical programming on francophone FM stations. This type of programming is drawing more and more listeners. The increase in advertising revenue on those radio stations testifies to that.

I would like to digress for a moment. We obtained the box office results for the movie, Séraphin: Un homme et son péché. It made $1 million at the box office in three days. It beat out Harry Potter and James Bond, which were showing for the third week. In three days, that movie generated that amount in Quebec, a small market, in one language. That's phenomenal. I think that that proves that television is popular because it has roots. It is rooted in cinema, in the live arts, in show business, music, humour, etc. It is those roots that we must not tamper with.

In order to contribute to cultural diversity, Canada must be a master of its own creative and broadcasting space. This challenge can only be met through a consistent regulatory strategy. We must avoid communication infrastructures that only serve as relays for the broadcasting of foreign cultural products.

Controlling our own creative and broadcasting space means strengthening the balance established by the Broadcasting Act. The CRTC is responsible for managing the delicate balance between achieving social and cultural goals and supporting an economically solid and competitive communications industry. The balancing required is therefore closely linked to Canadian content requirements and the ownership of companies.

The Canadian content policy depends on several measures whose purpose it is to promote the development of a cultural environment that will ensure the birth and viability of creative talent, without which there would be no Canadian broadcasting.

Canadian content does not just depend on broadcasting quotas. Policies whose purpose it has been to promote Canadian content on radio and television have always depended on an industrial structure controlled from within Canada. Besides being controlled by Canadians, this industrial structure must be diverse in order to ensure production quality. A handful of vertically integrated businesses will not encourage innovation and the development of good original productions.

Over the past two decades, a regulatory framework encouraging the diversification of creative sectors has been established. This has led to healthy competition and good complementarity for integrated broadcasting and production businesses and those businesses involved mainly in production. For example, the independent audiovisual production sector in Quebec, which involves more than 100 businesses, has contributed to the diversity of creative sectors and has produced works known for their quality at the national and international levels.

The current market trend makes the broadcasting and distribution of foreign works, especially American works, easier. That is why we need to continue to ensure that there are enough high quality Canadian pieces in these environments of abundant broadcasting. In order to do that, we need to ensure that the resources resulting from distributing foreign or Canadian content are reinvested in production.

¿ (0930)

Ms. Francine Bertrand Venne (Director General, Société professionnelle des auteurs et des compositeurs du Québec): Of the major elements of the Canadian system of broadcasting is the fact that Canada constitutes a specific market with regard to the copyright necessary for the use of works. Maintaining a copyright market in Canada prevents the problems which could arise from a continent-wide copyright market on radio and television content.

If copyright on American works could be negotiated apart from Canadian- controlled entities, it would be difficult to assure the survival of Canadian businesses which relied only on Canadian works for their living.

As a result, the possibility of presenting such content would be in the hands of the businesses which specifically hold the rights for Canada. In this way businesses which are obliged to respect the objectives of the Broadcasting Act would be able to collect the revenue from the presentation of foreign content.

If this policy were to be abandoned, broadcasting and distribution businesses located outside the country would be able to provide content to the Canadian public without being subject to the restrictions imposed on Canadian businesses. It would be far too difficult to require such businesses to make a significant contribution to the production and broadcasting of Canadian programming. By pursuing a policy which maintains a distinct Canadian market for broadcasting and distribution rights with regard to works for broadcast purposes, Canada acquires an essential tool for controlling its radio and television space.

Ms. Solange Drouin (Vice-president of Public Affairs and Director General, Association québécoise de l'industrie du disque, du spectacle et de la vidéo (ADISQ)): Control over media ownership is a measure used by many countries to protect the diversity of their cultural expression.

Ownership policies deal with the nationality of the people who have control over the businesses. They are there to guarantee that the regulations are effective. There are also conditions for acquisitions, which can lead to mixed and multiple ownership of media companies. The purpose there is to protect pluralism.

Many countries, to protect their sovereignty, have decided that broadcasting or telecommunications companies must be controlled by a majority of, for example, Canadian nationals.

Given the phenomenon of globalization, it has become more important than ever to ensure that Canadian broadcasting is effectively controlled from within Canada. This is about keeping our control over a key sector of the economy. Speaking of which, we all know that your committee's work is closely linked to the study that the industry committee will undertake on ownership of telecommunications companies. Mr. John Tory, from Rogers, who appeared before you last week, as well as other people whose many quotes we have seen in the papers, have been very clear about this. We're not just talking about this key broadcasting and distribution sector, but also another key sector of our economy, telecommunications.

In order to be able to enforce the regulatory requirements of a broadcasting policy, the companies we are imposing these conditions on must be controlled within Canada. For example, if we were to allow the implantation of American distribution companies, they could then artificially lower their fees, use dumping practices, and then claim that they were incapable of reinvesting in Canadian production. There would be a ripple effect on other businesses which could threaten the many measures that require reinvesting in Canadian production.

The Broadcasting Act refers several times to the Canadian nature of the system. First and foremost, the system must truly belong to Canadians and must remain under their control.

The most fundamental goal of our broadcasting policy is to promote Canadian radio and television. Canadian ownership rules have led to the creation of Canadian companies that we are very proud of. These companies are very good at contributing to and promoting our culture. Surely it is not the time now to weaken this ability by allowing them to become branches of foreign companies.

To protect the Canadian nature of our system, it is essential that the control of the fundamental components, broadcasting and distribution companies, remain in Canada, in Canadian hands.

There are many ways of providing Canadian companies with the necessary levels of capitalization without sacrificing their control, and I see today that we share our colleagues' views on that topic.

For example, a company such as BCE has most likely no difficulty in obtaining, in Canada or elsewhere, the necessary capital for its development. In fact, BCE made public its intention of purchasing the remaining foreign share of its company, that is 16.5% of a Texan company, to get it back. In other words, BCE has had no difficulty in obtaining foreign capital.

We want to point out the weaknesses in the argument that says that Canadian businesses absolutely need foreign capital to ensure their growth, capital that cannot be obtained unless ownership requirements are dropped.

Over the past few years, a considerable number of large transactions have occurred in the Canadian communications, broadcasting and media sector.

¿ (0935)

The Canadian businesses involved in these transactions easily obtained the billions of dollars they needed, sometimes millions, for financing. Furthermore, most of them obtained all their financing in Canada, without having to take advantage of allowed levels of foreign ownership, that is, 33.3% for holding corporations and 20% for licence holders.

Foreign broadcasters and media cartels that would like to play a role in the development of the Canadian broadcasting system must do so according to clear rules, and these rules must be established with the sole purpose of meeting the goals expressed by Parliament.

Ms. Francine Bertrand Venne: A variety of broadcasting tools and, in general, sources of information, are essential for ensuring creative freedom and this creative freedom is essential in ensuring original content. We firmly believe that if companies are held by a variety of owners, they will be in a better position to allow the expression of a variety of viewpoints.

This trend towards convergence in the broadcasting sector should encourage us to reconsider our ownership policies. We need to establish conditions that will allow us to benefit from the advantages of merged resources made possible by mixed ownership, while ensuring that conditions conducive to varied programming are in place.

For example, it would be unacceptable for a radio or television company with links to a group with interests in broadcasting, publishing, production and other related areas to exclude artists or works produced by a business that is not part of that group. We must ensure that all creators and producers have equal access to broadcasting. The more we allow concentration of ownership and of decision-making in broadcasting, the more we need to guarantee that those types of decisions will be made according to balanced criteria and ethics that are consistent with the Broadcasting Act.

We therefore need to require transparency. Companies with mixed ownership must periodically be accountable, and not only responsible for renewing their licence. We need efficient and public mechanisms for inquiries into complaints in order to ensure that more concentration will not lead to less pluralism in our creative sources.

Ms. Claire Samson: We need to acknowledge that Canada, over the past few decades, has been able to develop a policy ensuring that Canadians have control over their broadcasting companies. This has allowed the creation of conditions needed to ensure that resources are used for the production of Canadian content. Establishing a regulatory body with the means of intervening in the broadcasting sector as well as the telecommunications sector has allowed Canada to adapt to the convergence of these two sectors, and to guarantee a space for content that reflects our values and our culture.

Thank you. We would be happy to hear your questions.

[English]

The Chair: Thank you very much.

¿ (0940)

[Translation]

Before we move on to questions, I would like to speak to the members of the committee about two issues.

[English]

First of all, a lot of members have asked when we would have a business meeting to schedule our work from here until the break.

[Translation]

Ms. Gagnon, don't sulk. We'll explain.

[English]

I just wanted to let you know that tomorrow we have a meeting between 3:30 and 5:30. Then on Thursday we meet again from 9 to 11 on cross-media, and you'll be happy to know that Tom Kent, who published a very important report on the subject, will be there, as well as Wilson Southam and, from Ryerson University, John Miller.

So you will let me know between now and the end of the meeting whether you want to have a business meeting today or you want to skip it. It is up to you.

[Translation]

We will now move on to questions.

Ms. Hinton.

[English]

Ms. Betty Hinton (Kamloops, Thompson and Highland Valleys, Canadian Alliance): Good morning.

As usual, it's very interesting. I'm always interested in hearing witnesses' definition of culture. What I heard from the two gentlemen today was that culture is what's happening in Canada and covered by Canadians, so I look for a comment on that after. But what was even more significant to me was that you asked for the set-up of an independent council to monitor the media. I found that rather incredible coming from a member of the media, and I would like to hear a little bit more on that subject, if you would, please, because my concern has always been that there might be too much government influence over the media. It drowns out the diversity of voices, so for you to ask for a council to monitor the media came as a surprise. I would be interested to hear your reasoning.

The Chair: Mr. Murdoch.

Mr. Peter Murdoch: It's a proposal that in some ways springs from the Kent commission, and you might also ask Tom Kent about that. We've sort of reworked that proposal, and it was passed at our convention.

The idea is to have these councils set up at individual newspapers and broadcasters. There would be a contract outlining the responsibilities signed between the editor and the ownership. It would only be the editor who would have responsibility for the control and direction of editorial policy, not the publisher; there would be no interference from the ownership. The councils themselves would be made up of representatives from the employer, from the public, and from journalist groups.

This would be at arm's length from government. The only sort of muscle, in a sense, we would suggest they have is the tax credit one, that ownership might lose the tax credit if they didn't comply. It would be a completely transparent and public council responding to citizens' complaints, and the newspaper and/or broadcaster would be obliged to print or broadcast the annual reports of these councils.

We would also suggest that, in the case of national networks and/or national chains of newspapers, such councils be set up on a national basis to monitor the performance on a national level as well. That's essentially it.

The Chair: Mr. Abbott.

Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance): Mr. Murdoch, as I understand it, you are a journalist. I find it quite astounding that you as a journalist would be in favour of some kind of news-monitoring system. I just make that as a statement. Quite frankly, I find it appalling that journalists would feel that way.

But let me just ask the question, what would the penalty be? In other words, if there is going to be a media-monitoring thing, what is the penalty? There has to be some method of enforcement. Are we going to now have government laws that are going to go into the marketplace?

I believe your colleague just said that he would be in favour of some kind of rescinding of tax credits by the government. This is Big Brother gone crazy.

¿ (0945)

Mr. Peter Murdoch: Well, there are a few things. One is, the CBC is essentially an arm of the state, and we don't see a colonel in a uniform giving the news there. It's a very professional, very well-run news organization. I don't feel that to have some sort of government regulation is necessarily bad in itself. That essentially is the nature of government, to protect the public and provide service.

Also, I think the evidence is quite to the contrary. In fact, what the concern is and what we've seen to be the concern over the past two years is from corporate ownership. They're the ones that are creating the problem, and they create great concerns about abuse of power.

Finally, our view is not that these councils would be set up as an arm of government but that they would be tripartite. Employers would be represented there, journalists would be represented there, and there would be input from the public there.

Mr. Jim Abbott: But the government's power would be invoked by the use of rescinding of tax credits, so the government is involved.

Second, with respect to the Canadian Broadcasting Corporation, we must remember that the Canadian taxpayer has an $800 million involvement every year. Are we now going to say that the Canadian taxpayer should be paying for the news so we can monitor the news?

This is a very dangerous and a very slippery slope. It's just loaded with grease, in my opinion.

Mr. Peter Murdoch: The evidence is absolutely overwhelming that the danger has come from the corporate sector, not the public sector. Whether it's the Ottawa Citizen, the Montreal Gazette, or the Regina Leader Post, the evidence is overwhelming that it's corporate abuse we are concerned about, and we have to do something to protect this democratic society.

The Chair: Madame Gagnon.

[Translation]

Ms. Christiane Gagnon (Québec, BQ): For the most part I agree with you, Mr. Murdoch. In terms of press concentration, someone must be responsible for ensuring that the information being broadcast is sound and given good analytical treatment. If that responsibility is left up to the large consortiums, in my opinion, journalists might end up being laid off simply because they did not convey the ideology of the owners of these large consortiums.

I would like to ask you a question regarding the listing of foreign ownership restrictions for cable companies. You heard what some witnesses from that sector said last week; they spoke about content protection. They all told us they had no concern regarding content. They compared themselves to highways having no effect on content and they implied that I was not putting my question to the right people, that I should perhaps put my questions to you.

And so I am happy to see you. I was a little confused by what they said and I think that we need to talk more about this link between the highway and the content, which they say are two completely different things. My answer to that was that they cohabit and that an ideology of control can in fact be transmitted.

I would like to raise another question. Given that foreign ownership rules in the cable sector fall under the Broadcasting Act and that the telephone sector falls under the Telecommunications Act, lifting protection in the telecommunications sector, which falls under the Department of Industry, will put the cable companies at a disadvantage. In other words, do you think that this policy should apply equally to the Department of Industry and to the Department of Heritage for broadcasting?

Ms. Anne-Marie Des Roches: I am going to start, but I am certain that others will add on to what I say. We believe that there are strong links between cables, in other words the cable operators, and content. It is a little like journalism produced by Canadian journalists; it is a question of individuals, yet, nevertheless, it is also an issue of perspective. Similarly, a cable operator's involvement in providing content goes beyond providing cables; it includes portal layout, programming, scheduling, all of which has a direct influence on content.

I am sure that Solange has more to say on this subject, but I would like to add that, regarding telephony, what concerns me, is that WTO treaties on services suggest that telephony is merely the transfer of data banks and private conversations. If this is the case, where is the line which separates such a definition from e-mail?

Whether e-mail be delivered by Sympatico or Videotron, whether one uses a Bell or Videotron portal, where is the difference, and what are we downloading? When we get the news from TVA or from CTV, or when we download such and such a report or such and such a program, exactly under which category do we fall? Would it still be considered private given that it is one to one?

We are, in fact, in a gray area. The line separating telephony from broadcasting is subject to change. If we open telecommunications to foreign ownership—and we have, through the WTO, effectively committed to opening our services— then that will lead to another problem. What will become of the government's commitment, the government who, in the interest of preserving cultural diversity, said that culture would not be up for negotiation in trade agreements?

The door has already been opened as regards telephony and, little by little, they are getting ready to do the same thing for cable operators. This is a slippery slope and a blatant danger. If we open the door for telephony, I believe, that within about seven years, in other words the length of time that the CRTC licence lasts, everything will be out of our control. It should be noted that the pressure does not just stem from foreign capital; it also stems from all the free trade agreements on which no firm commitment has yet been made.

Is the treaty going to be concluded under the auspices of the WTO or UNESCO? Will it be a parallel agreement? All of these factors are important and create huge pressures. Personally, I do not see how we can claim to be protecting our cable operators and the broadcasting industry while opening up telephony.

¿ (0950)

Ms. Francine Bertrand Venne: Ms. Gagnon, let me tell you an anecdote on this subject. Cable operators took Canadian authors, composers and music publishers as far as the Supreme Court on the pretext that they, the cable operators, were simply carriers and that, therefore, they were not in violation of the Copyright Act. The case was before the courts for 10 years, it was eventually taken before the Supreme Court where it was decided that, given that they offer a range of services, they are providing Canadian cultural content. From that time on, they became cultural industries. They have protected themselves by using the term “cultural industry” and are now asking the minister to defend them internationally by using the term “cultural industry”.

We welcome them into the cultural milieu, but we want to remind them that they were considered to be in breach of copyright in terms of content. Therefore, they have strong ties with us. It is not true that they are mere carriers.

As regards the Internet, the last time that we appeared before you, we told you that it was essential—and we were asked to state this during the CRTC hearing on the Broadcasting Act—to regulate the Internet for the reasons that you have just described. We have many concerns regarding this convergence and the fact that it is all so closely linked.

Ms. Solange Drouin: That is an important point. Perhaps the cable operators are not keen to stress it, and we all understand why, but they are the ones who control the public access to content. So, when they say that they are merely carriers, we must bear in mind that they are also the public gateway. For us, it is clear-cut; if the public's gateways are controlled by foreigners, what will become of us? How much room will there be for the Canadian television services and the record producers that I represent? What gateway will we have? What access will we have to the public? We cannot bury our heads in the sand and say that they are only carriers. It is not true. They are responsible for making a system accessible to the public, and I believe that is very important.

To illustrate just how important it is to control this gateway, I would like to refer you to the example of the experience of the record industry in Quebec which clearly illustrates how important it is not to become dependent on foreigners in any sector.

Obviously, there was music in Quebec before 1980. Music did not start in 1980, it existed prior to that. But the majority of our success stories, for example Félix Leclerc and Beau Dommage, were under multinational labels. Before 1980, it was the multinationals who produced records. So, in terms of record production, we were totally dependent on foreign producers, not just American producers, but other nationalities such as Japanese, etc. This dependence created a real problem at the beginning of the 1980s. What happened? Between 1980 and 1982, as we all remember, there was a recession. Multinational record companies were told by their corporate headquarters, situated in Los Angeles or wherever else, to stop producing domestic products and to concentrate exclusively on distributing foreign products, distributing Michael Jackson. That is what they were told to do, and that is what they did. They completely pulled out of the market and Quebec artists who were starting out at that time, such as Paul Piché, could not find anyone to take them on. Multinationals had been told to no longer produce domestic products. There was, therefore, a void; 1980 to 1985 was the dark age for the record industry in Quebec. Little by little, an independent music industry was built. Such was its success, that today the producers of independent records control about 95% of foreign artists' output.

I am explaining all of this to you because I believe that it is important to understand that the state of dependence in which this important sector found itself resulted in something of a dark age. We needed 20 years to rebuild.

At the moment we are laying down tomorrow's infrastructure for the knowledge-based economy. If, once again, we allow ourselves to be dependent on foreigners, what will happen when AOL and others pull out? We will have to start everything over again, and I think that, as Canadians, we cannot allow such a situation to occur.

¿ (0955)

The Chair: I am going to give the floor to Mr. Harvard, but before doing so, I would like you to clarify something for me. You said that in the 1980s, people in Los Angeles told record producers to end domestic production. I thought it was the opposite, that they decided to end foreign production. Was that not the case?

Ms. Solange Drouin: No, multinationals were clearly told to focus solely on distributing American products, because distributing domestic products is a riskier proposition. For example, distributing Michael Jackson carries a lot less risk than making Paul Piché's next record.

The Chair: Yes, I see what you mean.

[English]

Mr. Harvard, followed by Mr. Mills, and then Ms. Lill.

Mr. Harvard.

Mr. John Harvard (Charleswood —St. James—Assiniboia, Lib.): Thanks, Mr. Chairman.

I want to direct my remarks to Mr. Murdoch.

Mr. Murdoch, unlike Mr. Abbott, I don't think we should dismiss your idea of some kind of an arm's-length council. As I understand it from you, this would be a council that would involve members from the employers, from the public, and from journalists. It seems to me that would be a way of bringing about an additional measure of accountability.

After all, these large enterprises are just that--large enterprises, large institutions. Some of them are as large as government now, and governments do have offices of accountability. We have our own auditor general, we have our information commissioner, we have our privacy commissioner, provinces have ombudsmen, and so on.

So something like a council that could offer up some pretty strong observations of the performance of a private institution may be in the public interest. I think it's something we should explore.

Let me ask you a question regarding cross-media ownership and concentration and foreign ownership. The way I hear you, you basically say this all comes as part of the package, really, that it's difficult to separate out. It's difficult to separate out, say, cross-media ownership from concentration or convergence, and then you can throw foreign ownership into that and make it really complicated.

My question really has to do with limits. You're talking about setting a limit, perhaps not unlike what we already have, when it comes to foreign ownership, and perhaps some kind of a limit with respect to concentration or convergence.

Also, when we're thinking of these issues we think of entities such as BCE, Rogers, and CanWest. Do you think these enterprises have become so large that we in government should start considering breaking them up into smaller units to perhaps meet limits that you have in mind?

À (1000)

Mr. Peter Murdoch: I'd certainly consider breaking them up.

Mr. John Harvard: I'm sorry?

Mr. Peter Murdoch: Yes, I would definitely--

Mr. John Harvard: You didn't use the word “break-up”, though. That's--

Mr. Peter Murdoch: What we suggested here--which was a bit of an arbitrary figure--is five years for them to divest themselves of properties where particularly there was a concentration of ownership that I think risks a democratic society. Vancouver is one, and I'm sure you know the case in Vancouver.

So, yes, I would think that would be our very first suggestion, and without threat to the shareholders, to be sure. You give them time to do this. It's not going to happen tomorrow, but, yes, I think the idea of putting them on notice that they're going to have to divest themselves of some of these properties is a sound idea.

Mr. John Harvard: But give me a specific example of what a divestiture might look like. Just give me an example. Would you take Rogers and say, as a beginning, that they would have to divest themselves of either cable, or print, or broadcasting? How would you do it?

Mr. Peter Murdoch: I'll just take the example of Vancouver, where CanWest has predominant ownership of both television and print. You would say, we're not going to allow that. That's not in the interests of Canadians, the Vancouver community, or British Columbians. You will have a period of time--we've suggested five years--in which you're going to have to divest yourselves of these properties. On a national chain you might want to look at the percentage of ownership or readership in the country and put thresholds there. We pointed out to you the British example. You can't have more than this percentage in any one city, this percentage in any one province, or this percentage nationally. I don't think the mathematics are too confusing to suggest when the threshold of danger to an information society is going to crop up.

I'm going to ask Martin to talk a little bit to the councils. This idea, as I say, was refined from Mr. Kent and his commission, but it came out of Martin's local.

Mr. Martin Mittelstaedt: I want to talk about foreign ownership and the breaking up of the chains before we leave that topic. I think the market is trying to break up these chains anyway. I think it's going to happen because the debt levels are so high that there's pressure on them to divest. I think policy-makers, in seeing that this is going to happen in the media, should set up firm rules around it to prevent the situation from happening again where we have overwhelming domination by a couple of companies in terms of control of the media. I think the print and television connection doesn't work well from a corporate standpoint, because there just aren't those synergies in it that they like to talk about. I don't think in owning CTV and The Globe and Mail that Bell has found that, and I don't think CanWest has found that in its Global and Southam connection.

On the councils, we developed that idea based on the Kent commission work, because we thought there was something fundamentally wrong in Canada when reporters were being threatened by their owners. If a reporter or editor spoke his or her mind about what their company was doing with regard to the journals they were producing, they were threatened with being fired. We found that unacceptable in the CanWest case.

We thought that media outlets have a larger purpose in a society than just grubbing for money for the owners. We have an important cultural and democratic role to play, and that role has to be safeguarded. We thought the best way would be by having an editor contract with the community they serve. This contract would spell out the goals of the organization, how the organization wished to cover the community, and the resources it would put into that. That contract would be monitored by a type of council, which would have input from reporters and editors, the community, and the owners. We didn't see it as an attempt to get state control of the media or to have government monitor your local newspaper--far from it. When these ideas were first brought up in the eighties by the Kent commission, the newspaper industry did try to spin it as an attempt at government control, incorrectly and somewhat deviously, I think. In response to that they set up ombudsman-type roles and local press councils in an effort to forestall higher performance standards being put on them. At that point they defeated these proposals. They put in something that's inadequate. I think that given what has happened in Canada in the last few years, it's time to revisit it.

The Chair: Mr. Mills.

À (1005)

Mr. Dennis Mills (Toronto—Danforth, Lib.): Thank you very much, Mr. Chairman.

I want to begin, sir, by apologizing to you because I missed the last two meetings. I was travelling the country, talking to Canadians about a whole range of issues. Not to my shock, but to my real surprise, the number one issue with Canadians today in terms of their concern is foreign ownership. If you read a newspaper or watch television, most people would think it would be Kyoto or the health care system. But foreign ownership, even though we're only seeing the tip of the iceberg right now, is an issue of special resonance and concern to young people.

Right now 38% of our nation is foreign owned, the highest it has been since the time we had to bring in the Foreign Investment Review Act. We're at a critical moment right now with this issue of foreign ownership. What a lot of young people said to me is, “If you only do one thing between now and the end of your political career, hammer away on the issue of foreign ownership”.

To me this very straight ahead idea of the four-point plan is a no-brainer, with its firm limits and a five-year timeframe, the formation of the monitoring counsels, the independent inquiry on the whole issue of foreign ownership, and with the broadcasters fulfilling their mandate. I'm going to campaign vigorously with all of my colleagues that these be part of the recommendations of this committee.

In fact, Mr. Chairman, I think your leadership on this committee and on this issue will be right up there with Kent and Davey, if we make sure foreign ownership is a key element of our recommendations.

But the thing I find disappointing in this whole exercise I just completed over the last little while has to do with the journalists of this country.

My question is to Mr. Mittelstaedt. How many members do you have in your union?

Mr. Martin Mittelstaedt: [Editor's Note: Inaudible]

Mr. Dennis Mills: Are the 3,200 mostly print journalists?

Mr. Martin Mittelstaedt: They're almost all print journalists. A reporter is supposed to be a member of our union at the Toronto Star, The Hamilton Spectator, Maclean's, and The London Free Press. We also represent editors and advertising and circulation people.

Mr. Dennis Mills: Help me out, Mr. Mittelstaedt. The question I have to ask you is why have journalists become so blasé on this issue of foreign ownership? I know there are exceptions like Linda McQuaig and Jim Travers, and a couple of others. But why are Canadians so far ahead of journalists, and, quite frankly, this House of Commons, in their concern around the whole issue of foreign ownership? Do you have some views on this?

Mr. Martin Mittelstaedt: I have had a number of discussions with colleagues. Some people at the Globe and Mail figure that if the ownership restrictions were lifted, a quality foreign chain like The New York Times would take them over and they would become a better newspaper. I think this is an absurd idea, because we could just as well be taken over by Rupert Murdoch.

Mr. Dennis Mills: It's sad.

Mr. Martin Mittelstaedt: I find it strange that the publisher of my newspaper would be one of the ones leading the charge for foreign ownership. He recently made a pitch for it in a business speech.

If there is one reason, I think many reporters and editors feel their papers have been so mismanaged and run into the ground by the current crew of owners and managers that anything would be better. But I think this is a false hope.

Mr. Dennis Mills: It wouldn't be fear at all, would it? It takes a lot of courage to talk about this issue because of the way we're dominated right now in terms of....

Mr. Martin Mittelstaedt: I think there's fear in the industry. But it's mainly at the CanWest end of things, where the owner has been much more aggressive in threatening people's employment. I haven't found this fear in other newsrooms.

Mr. Dennis Mills: Thank you, Mr. Chairman.

À (1010)

[Translation]

The Chair: Go ahead, Ms. Drouin. Please keep your comments brief so that everyone has a chance to speak.

Ms. Solange Drouin: I will be brief.

Mr. Mills, I am happy to learn that

[English]

foreign ownership is the number one issue in Canada. I didn't travel Canada coast to coast, but I'm sure you did. I'm very glad to hear that. I think this committee is in a good position to set the pace, because the industry committee has not even started its work.

I don't know when you plan to issue your report, but I think you'll make a difference. You can make a difference, because if you're very strong on the foreign ownership issue, you can direct some points to the industry committee. We think you will have to discuss it with your colleagues on that committee at some point. But I guess you're in a good position to set the pace.

Mr. Dennis Mills: I think it should be brought to the attention of the industry committee that over the last seven to ten years we've sold off almost $500 billion of Canadian assets--the worst sell-off of Canadian assets in the entire history of the country. I wouldn't look for any reversal of attitude from that committee.

The Chair: Ms. Lill.

Ms. Wendy Lill (Dartmouth, NDP): Thank you very much for coming here today.

I feel we're being rushed, and a very important piece of this problem we're looking at is being crammed into a short period of time, but believe me, that's not the case. What you are bringing to us today is critical to all of the members here.

Last week we heard from BCE, CanWest Global, and Matthew Fraser from the journalism school. They all basically had the official line that we no longer need any kind of regulation because the marketplace has changed. There are now thousands of media products out there, and it's possible to get these diverse voices from all over the place. The net was used as an example. Matthew Fraser said he gets on the net and looks at The Guardian or Le Monde. He said all of his students are multi-tasking all the time.

It's interesting. I think the Internet is being used widely, but I don't think it's to get diverse media opinions. I'd like your comments on that. I have a couple of teenagers. They multi-task, but they look at sports and chat with their friends. Some people who presented to us last year said the majority of people were looking at pornography on the net. I don't think we should be too lofty about what the net is being used for.

I want to look south of the border. I have an article here by Paul Krugman from The New York Times, who talks about the economic interest of the media and how they undermine objective news coverage. I have a quote from Roger Ailes, network chairman for Fox News, who said: “It was because of our coverage” that he won the midterms--meaning Bush. He said, “People watch us and take their electoral cues from us”. That's pretty scary.

In the United States, restrictions on ownership are being loosened even more--that's in the States; we're pretty small fish here--to the point that it's quite possible that the major networks will start to buy each other.

We have a handful of organizations that are essentially economic engines, not democratic protectors. They're not there to make sure many different views are being expressed. They don't deny that. I need to know from you if you can give concrete examples of when economic interests of the media undermine our objective news coverage. We need those kinds of incidents. We certainly have anecdotal stuff, but it would be great if we could have some clear examples.

Roy Romanow's commission just wrapped up, and one of the things he did was to challenge private health care deliverers to come forward with evidence that they could be as efficient and effective in doing the job. Should we not be asking the same thing of private broadcasters? Can you demonstrate that you can actually carry out the goal of protecting the Canadian right to democratic voices, as we've asked you to do?

À (1015)

Mr. Martin Mittelstaedt: One example I can cite of where economic interests have prevailed over journalistic ones is the London Free Press, a newspaper we organized around 1990. At the time we organized it, we organized the editorial section only; that was the initial organizing drive there. We had 150 people in that department, and right now that number has fallen by half.

If you look at the roster of the Ottawa press gallery, there's nobody on it from the London Free Press any more. There's nobody from the London Free Press at Queen's Park. The London Free Press under the Blackburn family had local bureaus spread all around the London area; they had one in Sarnia and one in Woodstock. They did a great job with covering the area around the newspaper.

They've been flipped a couple of times and now are with the Quebecor chain. The economic pressures are intense. They're restricting the number of staff they have for obvious debt-servicing reasons, and I think the quality of the journalism you can do in a news organization that's had half its journalists taken out is much reduced.

As for the kind of coverage people in London are getting as opposed to what they would have received had they had someone here, it just isn't there. The press gallery reporters for the large regional papers interpret what's happening here with an eye to what it means to their community, but for them it's gone.

[Translation]

Ms. Francine Bertrand Venne: I suggest that you look at it from a cross-ownership perspective. From that perspective, we see involvement by private companies and public organizations, or organizations subject to public structures. Here, I am thinking of the Broadcasting Act and the CRTC. As Canadians, we decreed that the airwaves would be public. But in cross-ownership, we encounter problems because some companies are subject to cultural content regulations and legislation through the CRTC, and of course we should bear in mind that the CRTC reports to cabinet. Now, we find ourselves in cross-ownership situations with private companies.

You should have seen Mr. Péladeau at the CRTC hearing when he wanted to buy TVA. This is a businessman who is used to conducting his affairs alone in his office. He was amazed that he had to spend days listening to all the pressure groups who wanted to talk about his plans to buy a company.

So we inconvenience business people, but we should remind the business people who complain about such inconvenience that in Canada they are not entirely private companies. At some point we decided to regulate the airwaves, and to add a political and cultural dimension to the industry.

Moreover, we should bear in mind that those people do owe us something, because we have made it possible for them to achieve a world-class level of expertise, something that now makes it possible for them to sell themselves—let's say things plainly—to foreign companies. Would they have achieved that level of expertise if we had not, as a country, decided that these were matters we should control?

The situation of journalists is rather similar to that of culture. From an economic standpoint, thousands of people in Quebec with jobs in the record and television industry will find that their jobs depend on the issues we are discussing today. Some may not rack up huge international sales, but they are not on welfare either. They make a living from their jobs, and that living is now threatened. So, in the same way as the concept of democracy applies to journalists, the concept of cultural diversity applies here. Ask yourself whether you really want to listen to Michael Jackson and not much else for the rest of your days. That is the issue here. Both democracy and cultural diversity are at stake. Those components cannot be seen in isolation; they are part of a whole. We want to make you understand that we earn a living with our art, even though we may not sell it in 185 different countries. We do have successes nonetheless. I would like you to understand that there are a number of Canadian citizens living off their art, and that is no small thing.

The Chair: I will give you a chance to speak a little later, Ms. Des Roches.

[English]

Go ahead, Mr. Abbott.

Mr. Jim Abbott: I would be very interested to hear from our friends about French programming in particular.

I would put to the committee and the witnesses that foreign programming, specifically U.S. programming, basically pays for Canadian content. We have $800 million a year coming into the CBC, and we have approximately the same amount of money coming through the various other subsidy programs for Canadian content. But the only way the private broadcasters can afford to pay for the other portion of Canadian content is because we have U.S. programming Canadians want to watch. That drives the commercials, which drive the gross profit, which can then be put back into Canadian content.

I wonder if you could help us understand if that's also true in Quebec.

À (1020)

Ms. Claire Samson: Mr. Abbott, you're raising a situation that is very clearly different in Quebec from English Canada. I would say that 15 years ago the most popular programs broadcast on French networks were probably translated U.S. programs, such as Dallas, Little House on the Prairie, and Three's Company. Thanks to some cultural willingness on the part of government with incentives and programs, in Quebec we have succeeded in building a star system that today allows made-in-Quebec productions to account for 19 out of the 20 most popular programs broadcast on either TVA, TQS, or CBC French network--but it took 15 years.

I know this situation is quite particular to Quebec. We're lucky; we have that. It's more difficult in English Canada because of course the proximity of American programming is there. And it's true, local and private broadcasters need those American programs to draw the commercial revenues that allow them to purchase the Canadian programming.

There needs to be in English Canada the same effort invested in local programming so Canadians can discover the quality of what can be done in Canada. I think it's very possible; it's a question of policies and a willingness to do that, but if for some reason tomorrow those Canadian companies were to belong to U.S. interests, it's over. It will never happen.

Mr. Jim Abbott: I wonder if you and I have a respectful difference of opinion, because it's my thought that this could be accomplished and is currently being accomplished by regulation. I'm not really sure that ownership itself makes any difference.

Any Canadian business person who is not driven by the bottom line will be replaced. It's that simple; that's what business is. Whether it's a Canadian-owned business or an American-owned business, if you have Canadian regulation in place, the business is obliged to abide by Canadian regulation. I'm suggesting, with the greatest respect, that we have a difference of opinion on that.

Mr. Peter Murdoch: I just want to add something briefly on the English side and say that a number of unions involved with television and film production got together and established a thing we call a Coalition of Canadian Audio-visual Unions, which represents about 50,000 workers in television and film. Madame Des Roches and I are the co-chairs of that organization.

One of the things we've been doing some research on is exactly this question, Mr. Abbott. We've found that in fact in places such as Australia, ten out of ten of their top shows are indigenous shows; in Germany indigenous shows are their most-watched shows. It is something we will be making recommendations on to both the CRTC and the Canadian content study. Something's gone amiss here in the way we have tried to encourage broadcasters and independent producers, particularly broadcasters, in airing and encouraging Canadian drama, particularly Canadian drama series, which is what you're talking about. That's another avenue for another world in some ways, but we are looking into it.

It's not, believe me, unheard of for countries to create an indigenous television and film production system and be very successful at it. Quebec is an example of that, but I think there are still some things they would probably like to see improved in Quebec as well.

À (1025)

[Translation]

The Chair: If you have recommendations for the Canadian Content and Cultural Identity Steering Committee, please make them to our committee as well.

[English]

It won't be lost, for sure. If there is anything you feel we should hear about, make sure you send it to our clerk.

[Translation]

Ms. Des Roches.

Ms. Anne-Marie Des Roches: Actually, I will answer both Mr. Abbott and Ms. Lill to some extent.

Broadcasters say that what counts is the bottom line. That is one of the reasons why the regulations are no longer working. The companies tell you that there are many approaches open. The trend is to hide out in unregulated sectors such as newspapers or the Internet. They hide there and make their money there, and they do as little as possible according to the regulations. All the things that can cause an imbalance in the system, particularly advertising, is done outside the regulations. This is similar to what we were saying—namely that when there is a diversity of options and there is a trend toward the unregulated sectors, we lose control. This will not work for more than five years.

As to the diversity of options, it has been proven that conventional television attracts the most viewers. Even though we have the Internet, we see that it is newspapers and conventional television that attract most people—I read at least three newspapers, including Le Monde, I watch the BBC, and so on. TVA has one million viewers, as does TQS. That is what most people are watching; that is where the largest audiences are. Thus, when we say that we have a diversity of options because of the Internet, we are creating a bit of a myth about the Internet. People are attracted by newspapers, radio and television; these are the media that shape people's attitudes.

[English]

The Chair: Madam Frulla.

[Translation]

Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.): Thank you, Mr. Chairman.

À (1030)

[English]

Thank you.

Thank you for having me here. I'm getting back into things that we discussed over and over again in Quebec. We had these discussions, took some actions, and were very successful in getting things accomplished.

[Translation]

Everyone knows me, and you all know that you are talking to someone who is already converted. Here, we are concerned first and foremost with protecting Canadian culture. And when I talk about protecting Canadian culture, I am emphasizing particularly the protection of English-language Canadian culture. In the francophone community, even though it is very, very fragile, we do have our language to help us out. What we are talking about today, I have not only observed but also experienced firsthand. I have seen large corporations buy up radio stations at crazy prices. It was well known that these corporations were paying three or four times the real price in order to dominate a market. These are the same people who come to see us now to ask us for help because it has become impossible to sell these stations. It is rather hard to take.

There is another problem, and I would like to know whether you agree with me on this. There is the whole issue of the Competition Bureau. The Competition Bureau will be studying the situation to see whether the company owns several radio stations or most radio stations in Canada. The fact is that the Competition Bureau never considers whether a company owns a few radio stations, a television station and several newspapers and magazines, and this means that we end up with cross-ownership. However, it is vertical cross-ownership, such as we see with Quebecor, for instance, where the same content is broadcast on television, on the radio, in the newspapers and in the magazines. That is the problem. I do not know whether you agree, but often, there is very little diversity of opinion and information. Why? Because in the case of a single corporation, it is the same information that goes from top to bottom. I think that is a very significant problem.

We discussed this issue on the weekend at the meeting of the Fédération professionnelle des journalistes du Québec. I am speaking here to Messrs. Murdoch and Mittelstaedt. The Quebec Federation of Professional Journalists called for a much more powerful Press Council that has real clout and can take action. At the moment, the Press Council can make recommendations, but it has no real power. Yes, there is also the body you are suggesting,

[English]

which is a multi-level regulatory--not regulatory, I don't like that--

[Translation]

but I wonder whether you would be satisfied with a press council made up of professional journalists, that would have enough power to denounce specific situations pertaining to information. Do you like the suggestion made by the Fédération professionnelle des journalistes du Québec, Mr. Murdoch, or do you think we should go even further?

[English]

Mr. Peter Murdoch: First of all, the press councils, as they are now formulated, certainly in most of the provinces, are simply, in a sense, organisms of the employer, employer-funded and in some ways employer-controlled, and there's really no teeth other than that some of them do occasionally print the results of the decisions. So we do have to find some other mechanism that has some more teeth to it, and that's why we have suggested these advisory councils, with the clout of the tax credits.

Ms. Liza Frulla: You're talking about this advisory--

[Translation]

The Chair: We would have to think of the others.

Ms. Liza Frulla: May I add a short comment?

[English]

I agree with all the recommendations; I'm sold. I'm like Dennis. We are going to fight for it and push for it. But the only thing that bothers me with the advisory board, where you have the owners and then the journalists, is, don't you feel it would have a tendency to be controlled by the owners, since they have the power?

When you tell me that the journalists are not scared, I don't know about your federation, but there's one thing I do know: in Quebec, journalists are scared. Certain of them are scared. They're scared to talk, because the market is even smaller. That's what worries me about it.

Mr. Peter Murdoch: I think there is a climate of fear in many newsrooms, not all of them, but certainly in a number of them there is definitely a chill, as they say, and great concern about how to thaw that chill--which I guess is what we're trying to do and I suspect what you're trying to do here. But it's there; there's no question about it. It's there in the English language media, as well as the French media.

Concerning the question of what we do about it, I'll diverge a bit here, but one of the things we are going to do as a union is to put together a code of conduct, a code of principles, for journalists, and because the employers have not in any way responded to academics, to journalists organizations, to unions--there has been absolutely no response from the employers to address the concerns--we are now going to have to come to the bargaining table and bargain these things, and we will be putting on the bargaining table for these employers a code of conduct that we expect them to live up to. Perhaps the teeth there will be in the collective bargaining process, but sadly, that takes away a bit from the input of the public, and that's why we see these advisory councils, because it's the public, the consumers, the readers in a democratic society that have the highest stake, in some ways.

Journalists have an obligation to provide the public with the best of information, but Canadians have a right to expect it.

The Chair: Madame Gagnon.

[Translation]

Ms. Christiane Gagnon: I think it is indeed a fundamental right. There's the freedom of the press, but also the freedom to be informed. It is one of the fundamental rights within the freedom of the press.

I get a little annoyed when I hear that Quebec francophones enjoy language protection. I think efforts must be made because protecting the language is not the only important thing; the ability to produce it is as well. You can broadcast American television programs in French and say that the language is protected. The public watches those shows because they are broadcast in French, but I think we should stop using that argument. If English Canada wants to protect its cultural diversity, let it do so, but the fact that we speak French is not an all-powerful protective barrier.

You say that you read a lot, including Le Monde. I recently read an article in Le Monde diplomatique in which Ignacio Ramonet issued warnings about media concentration. He said the introduction of players such as the Internet and satellites has resulted in many businesses that are involved in water, electricity or arms purchasing major portions of communications businesses. Those companies have become the major players, at least in terms of number of shares, in communications businesses. If, for example, there were a war in Iraq, imagine what the arms producers would do. There is perhaps a need to monitor that type of information control. It is important to be diligent and cautious and to see who owns those big companies. I invite you to read the December 2002 article by Ignacio Ramonet. Is that the type of concern you foresee?

À (1035)

Ms. Solange Drouin: I understand and I share your concerns. You raise a very interesting point: when telecommunications and cable companies request that property rules be more flexible, that is really why they do it. That is also something that should be discussed here.

When the property rules suited them and helped with their bottom line, the telecommunications and cable companies did not challenge them. No one did. I think their bottom line is still very good. That is not my personal opinion, but that of Matthew Fraser, whom Ms. Lill quoted, and whose articles I always read with interest because I find him intelligent. I do not share his views, but he is intelligent and we have to recognize that. Ian Morrison, the Friends of Canadian Broadcasting representative, usually totally disagrees with Matthew Fraser, but they both agree on one thing. What is currently driving the telecommunications companies to ask for a softening of the property rules? Well, they want to break Bell's monopoly. That's very clear and I'm not the only one to say so. There are lots of people who do.

As for cable broadcasting, what is driving cable companies to ask for more flexible rules? Companies such as Shaw, Rogers and COGECO, which are family-run businesses and who might have a succession problem, want to boost their image so that they can be bought out by foreign interests, because their executives want to retire and have enough income for a good retirement.

What I am about to say may be harsh, but are the telecommunications and cable companies really interested in Canadian culture? I do not think anyone is interested, neither the cable providers nor the telecommunications companies.

I think their underlying motivation is cause for us to be extremely cautious.

Ms. Christiane Gagnon: I am not sure whether I read this in your brief or in a different one, but perhaps you can answer me in any case. As regards the 20% foreign ownership, no attempt was even made to try to find the capital abroad to do the necessary development work.

When the representatives from the Canadian Cable Television Association appeared before us, they said that the broadband needed to be developed, given the advent of the Internet, and the fact that television programming on request was coming. If we did not try to get this 20% of the capital abroad, then we did not try to raise the maximum. Can you give us more information on that and tell us where you got these figures?

Ms. Solange Drouin: The example I mentioned in our presentation involved the telecommunications companies. At the moment, 16.5% of Bell shares are owned by a Texan company, and Bell has announced its intention to recover this 16.5% foreign ownership for several billion dollars. The company should not have any cash problems in that regard.

As far as the major cable companies go, our analysis shows that no one is involved at this level. We must ensure that the combined effect of the two ownership rules—namely the 33% for the parent company and the 20% for companies—represent an effective control of 47%.

We thought you would be asking us whether it is possible to increase the 20% to 25%, to give these companies a little more flexibility. It is quite clear to us that if there were even a slight increase, some interests could quickly gain a majority, because of the combined effect of these two rules, which amounts to 47%. Consequently, it is very clear to us that the rules must remain as they are at the moment.

À (1040)

[English]

Ms. Wendy Lill: One of the things we've heard from large conglomerates is that it is possible to separate content and carriage. For the life of me, I can't understand how that happens. I'd like to hear opinions on that. Is it something that is realistic, that is, within your experience, a possible scenario?

Ms. Francine Bertrand Venne: Let's always remember that for AOL and Time Warner, the worth in the company is in Time Warner, it's not AOL.

[Translation]

Finally, as regards the content and the carriage, there must be a reason in order for this to be a value added. I was saying earlier that the cable companies waged a campaign to get us to admit that they were just carriers. For some reason, the broadcasting companies tried to stop iCraveTV and Junk TV, because they were reusing their signals. It is nonsense to say that we can dissociate the content from the carrier, because, somewhere, we have seen companies wanting to add value to their business. Those who were carriers wanted to get some content.

With time, we see that the content companies are the ones that offer the most attractive economic value.

[English]

Mr. Peter Murdoch: I'll make a brief comment.

It's quite possible for carriers to influence the content. For instance, where you put your station on the list of 1 to 134 is a very important positioning of your content. AOL is one that can certainly limit access to the net, and it has a majority of subscribers. So the carrier has a huge influence on the content and can, I suspect, dictate what the content is that they would prefer.

I encourage this committee not to suggest that there's a trade-off and that to some degree we can relax foreign ownership in exchange for something like a benefits package of Canadian content. This is the great concern we have here, that you will relax foreign ownership and say, this money will come in with this kind of a price tag to it. That is not going to happen.

The Chair: We have 15 minutes left. I should mention to members, with regard to the business meeting, we can't have it because too many members have committee meetings at 11 o'clock, so it wouldn't be fair. We'll just have to find another slot somewhere.

There are 15 minutes left, so I would like to keep at least a couple of minutes to ask a question myself. I will allow one brief question from Ms. Frulla, Mr. Harvard, and Mr. Abbott, and one answer from any one of you there.

[Translation]

Ms. Liza Frulla: Thank you, Mr. Chairman.

I did not say that it was a protection, but rather a special incentive. English Canadians also enjoy the same benefits, and I think they use them very well. Otherwise, we would have to say that Ms. Lemieux is right. She said there is no Canadian culture, and this is absolutely incorrect. That said, however, I do not think they are as successful at it.

I would like to come back to what you were saying. Let us look into the future and talk about the upcoming steps. The CRTC has allowed many things in recent years because it said that perhaps it could not control everything, that it could not control the airwaves and telecommunications. Consequently, the CRTC has granted some licences. What do you expect of the CRTC now? What are you asking of it and what are you asking us to control in the case of this problem which is of tremendous concern to all of us here, with a few exceptions perhaps?

À (1045)

Ms. Solange Drouin: In our opinion, the current Broadcasting Act contains all the principles that the CRTC may apply. We are asking the CRTC to enforce its incorporating act until it is amended by Parliament. As I understand it, there are no plans to amend the Broadcasting Act at this time. Thus we think that if the act is not to be amended, it should be applied in its present form. The directive on ownership exists and is not being changed. The policy on broadcasting is clear. Let us apply it.

[English]

The Chair: Mr. Harvard.

Mr. John Harvard: Mr. Mittelstaedt, you people have mentioned how these large media companies are drowning in red ink. Where was the mistake made with respect to the overextension of debt or loans? One would have thought that by convergence, by cross-media ownership, that there would be economies of scale in these models. Where was the miscalculation, if indeed it is a miscalculation, where some of them are going to go bankrupt as opposed to this just being a heavy debt load for a short duration and they'll come out of it somehow successfully? Where was the mistake?

Mr. Martin Mittelstaedt: I think they overestimated what you could get out of combining a newspaper chain, say, with a television network. There are no great cost savings in putting those two businesses together. I think they thought there were. I think they also thought they could make more revenue by putting them together, and that hasn't happened. I think they got caught up in the bubble mentality in the stock market. They figured they could buy a property and flip it to somebody else and make a bundle of money, and they were wrong. I think they bought the properties knowing what the ownership rules were and now they want to be rescued.

I think the next course is that some of the debt that's being held by these companies will likely be converted into equity to allow them to be able to be viable business entities. That's maybe painful for existing shareholders and the families that run these companies, but it shouldn't be a reason for sacrificing Canadian cultural interests or sacrificing the means by which we can protect democratic access to the media.

The prime examples are Quebecor and CanWest. They were the most caught up in these trends and they are the ones who are suffering the most now.

The Chair: Mr. Abbott, go for it.

Mr. Jim Abbott: I'm rather curious as to how the union would see unravelling exactly what Mr. Harvard is talking about. I believe it was Mr. Mittelstaedt, or maybe Mr. Murdoch, who said it can be unravelled, and I wrote down the quote, “without threat to the shareholders”.

So the government is going to step in and interfere with private enterprise, and people around the world who may be inclined to invest in Canada, or even Canadian investors, aren't going to pay any attention to that. “Without threat to the shareholders”, I would suggest, is kind of pie in the sky, isn't it?

Mr. Peter Murdoch: First of all, shareholders in a lot of these media companies have already been beaten up severely without the long arm of government. So we can just look to the senior leaders of the corporations for that.

What I was suggesting was over a period of time. If you gave these companies a period of time, there wouldn't be that kind of trauma to the stock market. People would see, as they do now, that proposals would go out and there would be some time for tenders and bids to be made. So I wouldn't see the kind of immediate plummeting of share prices.

But let's remember--and I think it's important to remember, Mr. Abbott--that stocks in these companies have gone down severely on the basis of this misguided acquisition spree. Canadians are already paying a price, and we would suggest not only a price in terms of the democratic press but actual money.

I don't think there would be any threat in terms of the unraveling if we gave them some period of time to know. We've done it before. The United States did it with AT&T. If they can do it with AT&T, we can certainly do it with something like CanWest. Just give them some time to do it so it's not traumatic.

À (1050)

Mr. Jim Abbott: So the government can undo the bad corporate decisions?

Mr. Martin Mittelstaedt: I think the market is going to undo these decisions.

Mr. Jim Abbott: Exactly. That's precisely my point.

Mr. Martin Mittelstaedt: But what I would urge you to do is to give a bit of guidance to the market so that we don't get a situation where the concentration problem is even worse as this question is resolved.

Mr. Dennis Mills: High-quality intervention...you have to get back to the business of governing.

The Chair: There was an interesting comment that I picked up the other day in one of the sessions. One of the intervenors, Mr. Geoffrey Elliot, made the comment that one of the reasons for seeking a lifting of the foreign ownership limits was to enable these corporations and the other corporations to better invest in the United States. That was very interesting.

[Translation]

I very much liked your comment, Ms. Des Roches. It struck me because it was new for us; that was the first time we've heard it.

With respect to foreign ownership, with regard to the WTO and the Convention on Cultural Diversity, which Ms. Copps has moved onto the international scene, could you tell us why you think the issue of foreign ownership will come up at the WTO? This would be harmful to any opportunity to achieve a convention on cultural diversity in the context of UNESCO.

Ms. Anne-Marie Des Roches: The first stage will be in March 2003, when we will see the initial commitments of all countries on services. These are commitments made following the Doha Summit.

The Chair: You are talking about the WTO, are you not?

Ms. Anne-Marie Des Roches: Yes, I am talking about the WTO. Countries will be submitting their files on this matter. Audiovisual services have not yet been withdrawn. Canada has not put them on the table, but there is still pressure, particularly from the Americans, to put audiovisual services on the table.

The Chair: But Canada has made it very clear that all cultural products would not be included, has it not?

Ms. Anne-Marie Des Roches: That is correct. However, telecommunications, as well as insurance and travel services are included. So telecommunications and insurance are already on the table. Things were already being prepared for telecommunications, and I believe Canada has not yet said no. Two weeks ago, we heard Minister Rock pushing for a review of the foreign ownership rules in the area of telecommunications. We think this opens the door to this possibility.

The other point is that the Canadian government has not yet made a firm commitment not to place outside the WTO the instrument on cultural diversity. It would be our Kyoto protocol on culture. This matter is at UNESCO, but it is still open, and it is always said that the United States have a very major role to play in defining this instrument.

I do not want to cry wolf, but all these factors are disturbing. We have to look at the telecommunications sector as a whole, at all the services and their direct or indirect impacts—because in the long term there will be such impacts—on audiovisual services and our creative capacity. I am presenting a comprehensive view of this, because in March, when discussions on telecommunications will get underway, the pressure will come from there. We will be opening up the issue of ownership of telecommunications shares, and this will be where things start to slide, as I see it and from what I hear.

The Chair: Will you be appearing before the Industry Committee?

Ms. Anne-Marie Des Roches: Yes, our coalition of francophones is preparing for that appearance.

[English]

The Chair: Mr. Murdoch.

Mr. Peter Murdoch: Our union also represents telephone workers. We have workers at Manitoba Tel, SaskTel, Bell here in Ontario, Bell in Quebec, and Aliant.

I was at a conference in Halifax just two weeks ago where the issue of foreign ownership and preparing something for the industry committee were very much on the table.

I'll echo Madame Des Roches. We see it as a slippery slope. Once again, on the face of it there's no need for this foreign capital. The large players already have access to capital. We think they're capable business people. If there's an opportunity to make more money, I'm sure they'll go out and find it. But we're very concerned that it is a slippery slope to moving into the media. Once one of these small companies, such as AT&T and Rogers, finds a way to attract more capital, we'll have the CanWests of this world saying they have an unfair competitive advantage.

À (1055)

The Chair: I think I should give those colleagues who have a meeting at 11 o'clock a chance to leave now.

I would like to thank you all for appearing today. I think it was a really interesting session, where both sets of views were discussed, thanks to Mr. Abbott. We really appreciate that we can hear both sides of the story.

Thank you very much for coming. Merci beaucoup d'être venu.

Mr. Peter Murdoch: Thanks to the committee.

The Chair: La réunion est suspendue.