CMPA says without the rules, Cancon won’t get made
TORONTO – Corus CEO Doug Murphy this week restated his call for an affiliated studio system in Canada, akin to what U.S. and U.K. broadcasters have, so that companies like his can make, own and market shows of their own creation, worldwide.
The current system of regulations, as they stand now, force Canadian broadcasters to spend a certain percentage of the previous year’s TV revenues with independent producers to make programs of national interest (PNI). That means, however, it’s those producers, and not the broadcasters, who profit from the potential long tail of content sales on multiple platforms all around the world.
In an op-ed in the Financial Post this week, and then at the BMO Media and Telecom conference in Toronto, Murphy again called for change.
“Private broadcasters like Corus are the backbone of the Canadian content and media sector,” wrote Murphy in the newspaper. “But we face many challenges. Today, there are virtually no barriers to entry into our industry. Many massive, foreign, internet-based media and content companies have unfettered access to our market, with more on the way. These international companies are fragmenting audiences, intensifying competition for programming, viewers, and advertising, while diverting revenues out of Canada.
“…In order to compete with multibillion-dollar — even trillion-dollar — foreign internet giants, Canadian media companies need enough scale to finance increasingly expensive programming and the freedom to make the types of shows audiences want to watch. Unfortunately, that is not possible today, not because we don’t aspire to do so, but because it is expressly forbidden.
“To my knowledge, no other country’s regulatory and funding mechanisms are designed specifically to limit their home broadcasters from producing programming they can own outright and export internationally.” – Doug Murphy, Corus
“Canadian broadcasting policy still regulates the type of content we can make, where we can get it from, and when we can broadcast it. To my knowledge, no other country’s regulatory and funding mechanisms are designed specifically to limit their home broadcasters from producing programming they can own outright and export internationally,” Murphy wrote.
He followed up that opinion piece with more on Tuesday during his appearance at the BMO conference when he was a bit more specific. If Canadian broadcasters are going to continue to have to spend 30% of their revenues on Cancon (which includes all programming, not just PNI) “we need to have more of an ability to build an affiliate studio system in Canada, owned by broadcasters, to really strengthen our model,” he said.
“I’d like to think there will be some mechanism where [the federal government is] going to… perhaps get them (Netflix, Amazon, Apple, et al) to pay into the pot – and reduce some of the obligations on the traditional side. I’d like to think there will be some sort of movement towards the affiliated studio system,” he added later.
Broadcasters in Canada have often said the rules forcing them to do original Canadian drama and comedy (PNI) only through independent producers ensures they will only ever treat it as a tax, hitting their minimum spend obligations, often reluctantly, because they can’t profit from it outside of the country. In fact, the Corus submission to the Broadcast and Telecom Legislative Review panel says almost that.
“This obligation to spend a fixed amount on the most expensive genre of programming, the rights to which the broadcasters largely cannot monetize in international markets, remains a huge impediment [to investment]. It is an obligation Canadian broadcasters literally cannot afford as other, more profitable, lines of their business decline,” reads the submission.
The Canadian Media Producers Association has a far different take, of course, and took Murphy to task over his comments.
“We agree with much of what Doug Murphy writes in his recent op-ed, particularly that foreign digital media companies must share responsibility for supporting the production of Canadian content and that all who benefit from the Canadian system should contribute to that system,” said CMPA president and CEO Reynolds Mastin in an emailed statement to Cartt.ca.
“Regulators have found time and again that without requiring broadcasters to work with independent producers, Canadian dramas, comedies and documentaries do not get made.” – Reynolds Mastin, CMPA
“Also core to the sector’s success is the integral contribution of independent producers. Existing regulatory rules drive the creation of high-quality programming, which reflects the diversity of voices that make up our country.
“Regulators have found time and again that without requiring broadcasters to work with independent producers, Canadian dramas, comedies and documentaries do not get made. And it should be noted, Canada is not alone in the world in prioritizing the importance of a sustainable domestic production industry. Broadcasters in the U.K. and France, for instance, have similar obligations,” Mastin continued.
“Corus, which made $458.4 million in revenues in the last quarter alone, is only required to spend 6.375% of its annual revenues on these protected genres with independent producers. Aside from that small commitment they are free to produce programming in any genre with or without a partner.
“Loosening regulatory requirements on broadcasters, whether foreign or domestic, would ultimately lead to the reduction, and possible extinction, of high-quality Canadian programming enjoyed by audiences across Canada and the world.”
