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Results: 1 - 15 of 124
Luc Perreault
View Luc Perreault Profile
Luc Perreault
2020-06-18 17:50
My name is Luc Perreault. I'm the strategic adviser for Stingray, a Montreal-based company that owns and operates a portfolio of broadcasting and music-based services, including Stingray Music, available on cable and satellite and through various applications. We also own and operate over 100 radio stations across Canada. We're a global company active in 103 countries, with over 1,200 employees worldwide.
I have to switch languages now, so this requires a little bit of gymnastics.
I appear before you on behalf of the Independent Broadcast Group. With me is Joel Fortune, our association's legal counsel.
Our association represents 10 independent Canadian broadcasters operating in the television, radio and digital media sectors. We serve diverse and varied communities in all regions of Canada.
COVID has hit industries that depend on advertising very hard. We estimate that the broadcast advertising market has shrunk by 50% or more since January.
Before COVID-19, the Canadian ad market was already challenged by the growing dominance of large non-Canadian digital platforms, such as Google and Facebook, which are cutting into the broadcast ad market, much like what has happened in the newspaper industry. COVID-19 has made the situation much worse.
You also need to consider the high levels of concentration of ownership and vertical integration in our domestic market. A small number of the same companies control a large portion of broadcast revenues in all business lines via their multi-platform assets.
For example, in 2018, Canada's four largest media network companies—Bell, Rogers, Shaw and Quebecor—accounted for 73.4% of the $86.2 billion generated by media economic activity.
In the cable sector, the five largest broadcast distribution companies accounted for 88% of the sector's revenue. The same companies accounted for 91% of private Canadian conventional television revenue and 83% of total discretionary service revenue.
While independent broadcasters such as Stingray represent a smaller segment of the business overall, we're still fundamentally very important. Independent broadcasters represent fully 40% of direct employment in the Canadian broadcasting sector. We represent 69% of jobs in commercial radio, 39% in discretionary television and 14% of jobs in conventional television.
There's a multiplier effect as well. In a recent study, it was estimated that the independent sector accounts for more than 28,000 full-time positions annually in Canada through our direct operations and through our production and international distribution activities.
This is why we strongly support the extension of the Canada emergency wage subsidy. The CEWS has been critical for many independent broadcasters to maintain employment levels, especially for businesses exposed to the drop in advertising revenue.
We have also proposed additional measures also targeted to our industry.
First, we propose an enhancement of the existing tax deduction for advertising on independent Canadian broadcasters. The deduction would be increased to 130%. This would help level the playing field in an environment that heavily favours Canada's largest broadcasting groups.
Second, we support the extension of the news content tax credit developed for the print industry to the news programming produced by independent broadcasters.
Third, we support the reimbursement of the 600 MHz transition costs for independent broadcasters. These costs are being incurred to free up spectrum for other uses, including mobile use. All of Canada's largest media conglomerates also operate mobile phone businesses, so they will benefit from this transition. Independent broadcasters bear the same costs, but will not see the benefit, and they should be compensated.
We know that other initiatives have been put forward to support our industry, such as removing tax deductions for advertising purchased on foreign digital platforms such as Google and Facebook. We believe they make sense and are worthy of your consideration.
Thank you for hearing us today. We are ready to answer your questions.
View Kelly McCauley Profile
CPC (AB)
I have one last question.
There's a vote 5 use of, rounded up, $11 million for CRTC that Treasury Board transferred to provide financial assistance to broadcasters facing declines in revenue. Where exactly is that $11 million going? Who is it going to? It's going to CRTC, but obviously they present it to Treasury Board where that money's getting used if they're accessing the contingency. Where is it going exactly?
Glenn Purves
View Glenn Purves Profile
Glenn Purves
2020-06-16 18:36
That money is being used to address the immediate operational challenges.
View Kelly McCauley Profile
CPC (AB)
I got that from your allocations page, but for what though? They would have presented a plan to Treasury Board to access this. Where is it going?
Glenn Purves
View Glenn Purves Profile
Glenn Purves
2020-06-16 18:36
When broadcasting licence fees come off, that means the revenue they're bringing in is less, which means that they need an offset to cover expenses that would normally be covered by these fees.
View Kelly McCauley Profile
CPC (AB)
Your allocations page says that $11 million is going to Canadian broadcasters. Which broadcasters?
Glenn Purves
View Glenn Purves Profile
Glenn Purves
2020-06-16 18:36
It's offsetting revenue shortfalls caused by the reduction of broadcasting licence fees.
View Kelly McCauley Profile
CPC (AB)
If CRTC is writing off fees to broadcasters, it would appear this is making up for the difference.
Glenn Purves
View Glenn Purves Profile
Glenn Purves
2020-06-16 18:37
If broadcasting fees are reduced, as a consequence there's a revenue shortfall.
View Kevin Waugh Profile
CPC (SK)
Many media organizations are struggling. The reality only makes the allegations of predatory behaviour being levied against the Canadian Broadcasting Corporation even more disturbing.
I asked the minister on May 7 about these allegations, and he said he had not been informed of the allegations but would look into them.
We can't afford to have a Crown corporation using its status to try to wipe out its competitors in this country. Has the minister begun the investigation into the Canadian Broadcasting Corporation, and does he have any information that he can share with us here today?
View Steven Guilbeault Profile
Lib. (QC)
As the member said, these are allegations, and as you well know, the Canadian Broadcasting Corporation is an independent body. It's not controlled by the Minister of Canadian Heritage or the government.
View Kevin Waugh Profile
CPC (SK)
Well, these allegations were in the National Post on April 22. I brought this up to you on May 7 when I talked virtually.
Even more interesting, Mr. Chair, is that these allegations against the Canadian Broadcasting Corporation came from an organization in the minister's own province of Quebec, so can the minister take action to address any predatory behaviour on behalf of the CBC, or can the government's friends at the CBC simply get away with anything?
View Steven Guilbeault Profile
Lib. (QC)
Allegations are allegations, whether they are made in Quebec, Ontario or Alberta. As I said, the Canadian Broadcasting Corporation is an independent organization.
Troy Reeb
View Troy Reeb Profile
Troy Reeb
2020-05-07 17:17
Thank you, Chairman Easter. I will say, just off the top, that as a local broadcast partner with the CFL in several markets, we have strong sympathy for and a strong understanding of what the league is going through.
Good evening, committee members. My name is Troy Reeb. I serve as executive vice-president, broadcast networks, at Corus Entertainment. On behalf of our company, and our 3,500 employees across Canada, I want to start by thanking this committee, your parliamentary colleagues in the House and Senate, and all federal public servants for the tireless work you are doing to protect Canadians and support our economy.
I am pleased to be here tonight to discuss the impact that COVID-19 is having on our company and on our programming for Canadians, and to share our thoughts on government responses to this crisis.
First, I will say a few words about Corus. We are Canada’s leading pure play media and content company. We operate 15 Global television stations; 34 specialty networks including such leading brands as HISTORY, W, Showcase, HGTV Canada and Food Network Canada; and 39 radio stations across the country. Our subsidiary, Nelvana, is Canada’s premier animation studio, and Corus-owned Kids Can Press is Canada’s largest independent children’s book publisher.
In Quebec, we operate Historia, Séries+, Télétoon and the Disney channel. Toon Boom, our Montreal-based division, creates software for international studios.
We work closely with producers to create thousands of hours of Canadian programs every year. All told, our programs and our products are exported to 160 countries around the world.
Every part of the Corus Entertainment family has been affected by COVID-19 in some way. As is the case for so many other businesses, our supply lines have been disrupted, our customer demand has fluctuated, our employees have had to adjust to working from home and we just don’t know when things will get back to normal.
Uniquely, we have continued to provide an essential service to Canadians throughout this crisis. Global News, as you will know, is one of Canada’s largest journalism organizations. We employ approximately 1,000 journalists and technicians in the news division and spend roughly $140 million per year to provide local and national news from coast to coast. Since March, we have proudly maintained all of our local newscasts. More than that, we have added special COVID-19 news broadcasts to our schedule, provided round-the-clock updates on all our radio stations, interrupted regular programming to air news conferences and health briefings daily, and launched a 24-7 online news streaming service. We have done this while navigating significant logistical challenges and having to invest in new equipment and technology to protect our news-gathering staff.
Audiences have responded. Ratings for Global News broadcasts have risen significantly since March, and Global News has solidified its place as the number one private-sector online news brand in Canada. In this time of uncertainty, Canadians are gravitating to reliable news and information sources, and we are very pleased to be one of them.
However—make no mistake—the news business is challenging. It was challenging before COVID-19, and it is more challenging now. It is challenging for journalists, like Caryn Lieberman, who last week spent a day behind the scenes, telling the stories of life and death in one of the country’s busiest COVID-treatment wards at Toronto’s Humber River Hospital. It is challenging for our business, which has needed to invest even more in gathering the news while pre-empting the commercials that pay our bills.
Our news content is delivered almost entirely on radio, TV and online platforms, all of which are entirely dependent on advertising. Since social distancing restrictions were enacted in mid-March, and with many businesses closed entirely, we have seen significant disruptions to our advertising revenues. Because news, and local TV and radio more generally, operates on a fixed-cost structure, the bottom line has significantly worsened.
Corus is extremely proud to be a news provider. We want to continue to provide this essential service to Canadians for years to come. Crises like COVID-19 have a way of clarifying what we as a society cannot take for granted. We believe broadcast news is one of those things. It is vital; it faces challenges, and it needs support.
What can the government do to help?
First, I want to recognize certain helpful measures the government has already taken. On March 31, Minister Guilbeault announced that the CRTC will not request payment for part I broadcasting licence fees for the current fiscal year. This measure will provide roughly $30 million in savings to the broadcast industry.
While that amount is relatively small and will not nearly cover the news broadcasters' shortfalls, it is a start.
We would strongly urge the government to place news broadcasters in a stronger position to sustain their operations now and going forward. That would entail measures such as waiving additional fees, such as broadcasters' part II licence fees, which are more substantial, as well as things like reimbursing certain costs, such as the 600 megahertz transition costs that have been forced onto broadcasters not through the will of their own, but by government decisions. We believe it ultimately entails ensuring that private broadcasters are able to cross-subsidize news with other, more profitable parts of their businesses.
While COVID-19 may be consuming a great deal of Corus' current organizational focus, we intend to emerge from this crisis on a solid footing. Our news division and the dozens of communities it serves with public-interest journalism require our future success.
That is why broadcasting policy reform remains so crucial. Before understandably shifting its focus onto COVID-19, this government pledged to table new broadcasting legislation in Parliament by the end of the year, and we certainly hope that's still possible. The government recognized that a rapidly changing, competitive environment has made broadcasting policy reform an urgent priority, and we would say that COVID-19 has made it more urgent still.
While almost every other business in Canada has been making rapid adjustments to deal with the new economic environment, broadcasters are not treated like every other business. Corus' licences require us to spend 30% of last year's revenues on Canadian program supply this year, regardless of what has happened to this year's revenues. Our licences prescribe not just what kinds of programs we need to spend our money on, but the time of day we have to run them. All of this limits our ability to adjust for COVID-19 in the short term as well as remain competitive long term with foreign streaming giants.
Thank you again for the opportunity to appear tonight. I would be pleased to answer any questions.
View Pierre Poilievre Profile
CPC (ON)
Thank you very much.
Mr. Reeb, the government keeps telling us how much we need Canadian content. Corus is actually a gigantic Canadian content factory. You produce not only news but also documentaries and historical productions. You have one of the most, if not the most, impressive animation studios in all of Canada. You are literally cranking out an endless supply of Canadiana through your enterprise at Corus. Yet far from helping Corus, this government, and governments historically, are imposing massive regulatory and other governmental costs on your operation, costs that your inevitable international competitors do not face, in the form of heavy regulation, restrictions on the types of investments you can take, and the requirement that you give some of your air time to content that your viewers and listeners don't want to hear or see.
Some on the left would simply say the solution to that is to impose all of these massive, cumbersome regulations, rules and taxes on your global competitors, but of course, there are some things that we cannot do beyond our borders, and it is impossible to stop the leakage of entertainment and other content across our borders because Canadians have the freedom—thank God— to watch and hear whatever they want. In other words, it's not possible to pick up this monstrous regulatory apparatus that we impose on Corus and impose it on the whole world.
Can you describe the enormous costs and disadvantages that Corus faces as a result of the governmental apparatus that you must navigate just to provide Canadians with the content that they want to receive?
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