By Ahmad Hathout
Media company Blue Ant’s request to reduce its obligations to programs of national interest (PNI) from 13.5 to five per cent of annual revenues is “unprecedented” and would spell the loss of an important contribution to the content production system, creatives are saying in submission published Tuesday.
The Directors Guild of Canada (DGC) said in an opposing submission to Blue Ant’s July request that the Toronto-based company’s PNI spending is essential to independent productions and the expression of diversity of Canadian and indigenous talent.
“Blue Ant’s historical PNI report is a testimony of the broadcaster’s important contribution to the system and the independent production sector, particularly to long-form documentaries,” the DGC said, adding such a significant reduction to five per cent “would result in an important loss to the system” – in part owing, it said, to dwindling support for PNI over the last five years.
The organization also said that PNI are among the “most high-cost and high-risk types of content to be made within our broadcasting system.
“This reduction would significantly impact the funding available for the creation, production, and support of Canadian and Indigenous content, including independently produced programming,” the DGC said. “Additionally, it would further diminish resources available for content creation by equity-deserving groups and lead to a notable loss for Canadian audiences nationwide. In our view, approving Blue Ant’s application would not serve the public interest and is inconsistent with the public policy objectives outlined in the Broadcasting Act.”
The Writers Guild of Canada added in its own submission that the CRTC has already approved lower regulatory fees for broadcasters with the elimination of Part II licence fees, valued at more than $120 million. It also said now is not the time for another one of these applications while the CRTC implements the new Broadcasting Act brought on by the passage of the Online Streaming Act, which will regulate online streamers and therefore broaden the contribution to Canadian content.
Blue Ant’s application acknowledged the CRTC has suspended similar applications, including from Bell – which filed a submission in support of Blue Ant – for the purpose of allowing it to implement the new law. Blue Ant said its application, which is only two pages in length, is intended to drive home the “urgency” of the matter.
But the Writers Guild of Canada (WGC) takes issue with that reasoning in its own submission, stating the CRTC should reject the application just based on that.
“The paucity of substance in Blue Ant’s two-page cover letter further supports the conclusion that this is an application made not with the reasonable expectation of success on its merits, but to ‘make a point’ to the Commission and/or others about the current pace of proceedings,” the WGC said. “It is fundamentally deficient in terms of evidence, statistical or otherwise, and in terms of a meaningful level of discussion and analysis upon which to base a decision on the relief requested.”
The WGC, like the DGC, said the commission set Blue Ant and others’ PNI obligations based on their historic spend on those programs. And even in that case, the spend isn’t out of line with their revenues because it is a percentage of whatever they take home, they said. In other words, the obligation scales with whatever they make.
This is the same argument creatives presented to the commission before it ruled that Corus should be treated as an exceptional candidate for relief, a decision that is being challenged in court by the Canadian Media Producers Association (CMPA). The CMPA added in its own submission opposing Blue Ant’s application that the CRTC was very specific in its decision to grant Corus relief on an exceptional basis, saying that the pure-play media company was “fundamentally different” from other applicants for relief, including Rogers, Bell, Quebecor, and Blue Ant.
The Documentary Organization of Canada – like the mentioned creative groups – and the Forum for Research and Policy in Communications (FRPC) argued that overall, Blue Ant hasn’t substantiated its request.
The FRPC, a public interest group, said it is opposed on the basis that there is insufficient evidence backing Blue Ant’s position, including estimates of how reducing PNI will impact dramas, documentaries and award shows; empirical analysis of how an existential threat to Blue Ant is eliminated with the reduced PNI; and how its financial position is dire.
Broadcasters back Blue Ant
The Canadian Association of Broadcasters (CAB), Bell, and Corus joined Blue Ant’s corner.
The CAB said the CRTC risks devastating financial consequences if the broadcasters aren’t afforded spending relief or not given the opportunity to judge for themselves where their money should go to align with their audiences.
“What we see in the plan is several proceedings that are likely to increase regulatory burden, rather than decrease it. We are concerned that the Commission will only consider changes to the existing contributions of traditional broadcasters during the “implementation phase” of its modernization of the broadcasting framework – and likely not before 2026. This will be a case of too little, too late.”
While Bell said it supports Blue Ant’s application, it noted that if the CRTC grants its application, it must also provide the aforementioned flexibility to the other applicants, including itself. “The requested relief that we and other broadcasters sought would have allowed us to better manage our other regulatory obligations through the evolving competitive landscape of the Canadian broadcasting industry in the face of competition from [digital media players],” Bell said.
Corus, which had its PNI obligations temporarily reduced from 8.5 to five per cent, added that the old system doesn’t work anymore. What is needed, it said, is an “outcomes-based approach that specifies desired policy outcomes for regulated entities but empowers them with greater discretion to select the means of achieving the objectives.
“This will support a more nimble and sustainable broadcasting system that draws on different players’ strengths to realize shared goals,” Corus said. “The Commission need not, indeed must not, wait to begin the work of transitioning from prescriptive to outcomes-based regulations.
“On the applications of licensees like Blue Ant and Corus, it should quickly entertain requests to eliminate or amend prescriptive licence conditions and commence laying the groundwork for an outcomes-based approach. As Blue Ant noted, ‘We simply cannot wait any longer.’”
