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Thank you for allowing us to share this perspective. I'd be pleased to answer any questions.

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To begin with, there are the content quotas. For example, TVA must have 50% Canadian content in the evening. After that there are the Canadian programming expenditure requirements, the expenditure requirements for national interest programs, the independent production and local production requirements. We also have to comply with the expenditures and the number of hours for local news. We also have subtitling and described video requirements, and the obligation to contribute to independent funds and the CMF.

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Fortune, you were giving a good legal statement on policy. You didn't get to the consequences, in a sense. You referred to the Lincoln study.

As I was saying, this situation itself is also Kafkaesque. What we're talking about here is a practical matter, and I want to emphasize that. Were no longer talking about state television or cultural missions, but practical matters, particularly in connection with the capacity to counter private broadcasters.


I think I would want to reframe that and say that it's not about reducing CanCon. That's not what we've been talking about. I think it's about being more flexible about the sorts of CanCon that Canadian broadcasters can invest in. Right now there are fairly strict rules on what sorts of programs have to be supported and who it is that broadcasters have to support.

Ownership is still concentrated among a few major broadcasters. In fact, the smallest players, the independent broadcasters, for example, represent a declining share of the market. Could you tell us how important it is for ownership of the cultural industry to be diverse?


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I'm hoping to get two rounds in. I may ask for permission to cut down a little bit on the time in the second round. Please bear with me. We will get to that a bit later.


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You've received our seven main proposals for the improvement of Bill C-10. I'll go over them quickly and I'd be happy to hear any comments or questions you may have.


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Third, the act must continue to promote Canadian talent. The wording of paragraph 3(1)(f) under subclause 2(3) of the bill, could mean that Canadian broadcasting undertakings would no longer have any obligation to use Canadian talent, whereas the current wording already allows for factoring in the nature of the undertaking.


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It has been devastating because of COVID, but it started long before COVID. Who knows when it will come back or if it will come back?

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Furthermore, they're the ones that will have the last word about our cultural sovereignty. That will mean major decisions concerning the content that's offered. The algorithms that direct Canadians to content via various apps are created outside the country for global platforms. Those major platforms are therefore of no particular interest to Canada.


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We saw a greater training ability and we saw opportunities that would otherwise not exist for Canadian talent, and the same takes place in the writing room as well. I think it's a tougher battle for the writing room, but one that can be overcome. Again, the flexibility of allowing the CRTC to deal with these issues can address those issues.

Some broadcasters find Canadian content regulations and requirements onerous, but it's important to provide this content to Canadians. All of this could also be managed via the new contributions that online broadcasters will contribute. Thus if a broadcaster is receiving a lot of money for production, it is only to be expected that it will have more demanding obligations.


I mean, that's absolutely a canard. It's about allowing broadcasters to invest in programming that is their own and to not necessarily just have to spend externally.

First of all, distribution services provided by online companies need to be included, as was mentioned earlier today, and social media need to be included unambiguously. We understand that the intent is to include social media, and the role they play, in organizing professional content, but we find that the exclusions in Bill C-10 are causing confusion. Our approach would included them from the outset, so that the Canadian Radio-television and Telecommunications Commission, the CRTC, can fully exercise its new powers to collect information from these companies, and determine whether they should to be required to contribute to our ecosystems and how they should do so.


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I'm hearing over and over again people talking about the difficulties that Canadian broadcasters face, in part because of regulation, and then also because of new streaming content, for example, coming on and not being subject to the same regulation. I tend to agree with your point that easing regulation on traditional broadcasters would be a better approach.

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The group supports Bill C-10 but requests that it be amended before it is adopted. The bill gives the CRTC the necessary authority to supervise online programming services, such as Netflix, that offer individual programs to subscribers. The bill confers significant powers on the CRTC but withdraws the power to supervise online distribution services at the very moment the major cable companies in Canada are preparing to offer Internet distribution services in conjunction with their established cable services.

My name is Pierre-Karl Péladeau, the President and Chief Executive Officer of Quebecor Media. With me is Peggy Tabet, Vice President, Public and Regulatory Affairs of Quebecor Media.


We were stunned when we found out that the CRTC was holding public hearings for CBC/Radio-Canada while we were studying Bill C-10. The bill does not affect the CBC/radio-Canada mandate at all in terms of determining how to make it more profitable, to review its role and other aspects. You spoke about it in your address.

If I could leave with one note of concern from the workers in this industry, it would be do no harm. As well, I would like to take this opportunity to thank the Department of Canadian Heritage for its incredible work to support cultural workers during the pandemic. The IA also represents workers in the live-performance industry, and the actions of the federal government have made a difference for thousands of families who have seen their livelihood decimated.


It's important that we begin to supervise this ecosystem to ensure the discoverability of Canadian content. We have to see to it that Canada and Canadians have access to Canadian programmers, not programmers who sign global, worldwide agreements with certain services.

I'm co-chair of the Coalition for the Diversity of Cultural Expressions, CDCE. We are a coalition of 43 organizations representing more than 200,000 creators, performers and professionals in trade associations, music and screen production, publishers, unions and collectives.


The directions are relatively consistent with the discussions we've had with members of the committee. However, the Independent Broadcasters Group would prefer that certain elements be included in the act rather than the directions.

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Today, after a 30-year wait, the government is proposing to regulate foreign players instead of deregulating domestic broadcasters. We have serious reservations about the CRTC’s ability to enforce these new regulations and restrict the behaviour of foreign online services.

Without going into the details, could you tell me whether you think the CRTC has the capacity required to enforce the new regulations to restrict foreign online companies? I'd like to hear your opinion, but only briefly, because I have other questions.


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In the meantime, I want to introduce our guests. From the Coalition for the Diversity of Cultural Expressions, we have Nathalie Guay, executive director, and Bill Skolnik, co-chair. From the Motion Picture Association-Canada, we have Wendy Noss, president. From the International Alliance of Theatrical Stage Employees, we have John Morgan Lewis. Finally, from Quebecor Media, we have Pierre Karl Péladeau, president and chief executive officer, and Peggy Tabet, vice-president of public and regulatory affairs.

I'd like to remind everyone that we are still in a hybrid format. We are all online, by the looks of things, with the exception of me. I would remind all of you that you are not allowed to take pictures or snaps of the screen for distribution.


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Well, I think it means that you're building policy for the future here, and that policy needs to be predicated on the fact that these are not the same business models as broadcasters'. They are not producing the same kinds of content. They do not have the same regulatory benefits, and they're not protected from competition in the same way. There have been witnesses who have come before you and have said that you should just impose on online services the same obligations and same definitions that Canadian broadcasters have.


I believe that the context has definitely evolved. Many have pointed that out here today. However, it does not mean that the goals we were defending 30 years ago are no longer applicable today. There are emerging concerns and new players, and it's altogether legitimate to ask them to make a contribution. I think that many of them will benefit. What's important is to make the right decisions today, here and now, for the future of our cultural sovereignty and the future of our culture.

Anyway, I want to refer back to Wendy and John. I use this phrase: It's not mutually exclusive. Helping one does not take away from the other. We need to take advantage of the fact that we can enhance our own folks with our own talent.


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We're afraid that we will end up with more translated content or content subtitled in French unless the act is strengthened. We believe that it's important to strengthen the act with respect to original francophone content.

As for broadcasting funding, I'll give you an instance of this. One might wonder how such a thing might still exist, but to give you an example, there are people who time the length of audience applause during programs to determine whether or not broadcasters can get a tax credit. This was something that used to be done when awarding a licence, or a privilege, but it no longer exists. Now, distribution is over the Internet.


You support Bill C-10, but you have many reservations. We've had a chance to discuss it amongst ourselves.

We cannot leave unmentioned a point that is notably absent from this bill: a refocused mandate for CBC/Radio-Canada. Recently, the CRTC held public hearings on the renewal of CBC/Radio-Canada’s licences. One after the other, more than 70 industry stakeholders said the public broadcaster has gone off the rails.


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I know Mr. Skolnik mentioned creators and performers in our culture or industry. You used the word “devastating”, and I could not agree more. Digital content more and more is becoming demonetized. For so many consumers, music has become practically free, writing is becoming free, people obtaining videos and images is practically free. We all know that creating art and creating music, those stories, take years of dedication. That requires a means of support. If things aren't going to change, a lot of our art is going to basically cease to be sustainable.

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Directions may change from one government to the next. Consequently, if the Governor in Council has to issue directions to the CRTC every time the government changes, you can understand why broadcasters may find it hard to prepare their strategic plans.

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When Bill C-10 was tabled, the Department of Canadian Heritage’s presentation document promised, and I quote, to “address regulatory asymmetries” and “provide flexibility and predictability”. However, it is clear that the consequences resulting from the bill in its current form go against these objectives.


I was listening with interest to Ms. Guay just a short while ago. The fact is that we don't need regulation to know that we need to invest in Canadian programming. We have always considerably exceeded the established thresholds. And yet we still have this mandatory administrative burden. We know full well that it's important for us to disseminate Canadian content, and that's what we do. We also provide work for the craftspeople and all those involved in the cultural, television and cable sectors, and all for one very simple reason—our audience. God knows that there's talent in Quebec, and the audience expects us to put it on the screen.

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This goes to the previous question. We were talking about the idea of Canadian ownership. I think that one of the things we keep talking about in this discussion is creating a less and less equitable broadcasting system between Canadian operators and international operators.

I can't speak exactly to the last quarter or whatnot. I do know that effectively, over the last seven years, broadcasting at large has been losing money, certainly on the TV side. We've seen independent producers that have basically seen about seven years of growth, while we've seen seven years of decline.


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Global streaming services bring opportunities for Canadian creators, contribute to economic growth and offer appealing entertainment for Canadian consumers. Allowing the CRTC to tailor conditions of service flexibly, based on how best each of these services can or should contribute to Canada, is a modern, sensible approach.

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Yes, it has to be provided somewhere, either in the preamble to the act or in the directions, that the aim is to increase support for the production and dissemination of Canadian content. I think that has to be clear because, as Mr. Perreault says, we may indeed be at the mercy of successive orders that might be made by the Governor in Council, which could alter the interpretation from one government to the next.

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The original and legitimate intention of the legislator to regulate television broadcasting had, as a corollary, the granting of a licence and the holding of a privilege. Today, and for many years now, technology has made it possible to broadcast without borders and without a licence. Trying to regulate what cannot be regulated is unrealistic. That's why the bill should provide traditional players with the regulatory flexibility they need and lighten their administrative and financial burden by removing unnecessary requirements. Quebecor believes that to modernize the Broadcasting Act and make it fair for Canadian businesses, regulation should be eased when market forces are operating effectively, and regulated only when necessary.

We're going to go into the second round. I say that because I like doing that, but also because we've asked these guests to come back after we scheduled them several weeks ago and cancelled at the last minute for reasons of democracy.


I want to say thank you to my colleagues for helping me out on that second round. I'm glad we got through it for reasons that are quite evident.

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For traditional broadcasters, those that showcase our Quebec and francophone culture, and the resulting economic benefits, the bill imposes new regulatory restrictions that will not redress the unfair conditions they have been coping with for years and will only pull them even deeper into the financial abyss and a Kafkaesque universe of regulation. From 2021 to 2021, the profits before interest and taxes of Canada’s main private over-the-air television broadcasters plunged by a combined total of $223 million. By 2021, the decrease was even more drastic, totalling $336 million.


Take the OutTV channel, for example, which represents the LGBTQ2 community and signs agreements with Apple and in Australia. Consider the Pelmorex corporation as well, which broadcasts the weather in Canada, Spain and Portugal and is targeting the Latin American market. These entrepreneurs create solid corporations, like Stingray, which is established in more than 100 countries and has hundreds of millions of subscribers outside Canada. That's not what the major platforms like Bell, Vidéotron and others do, but the entrepreneurs that belong to the Independent Broadcasters Group invest and export.

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The matter of protecting original francophone and Canadian content is of great concern to you. You are suggesting three amendments to Bill C-10 for the protection of French-language productions.


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In the rest of the country, only 4% of francophone content is created by francophones outside Quebec, and I don't think that's enough. We have to find a way to ensure both that the creation, production and presentation of original French-language programming flourishes across Canada, including in French in Quebec, and that the act recognizes the francophone communities outside Quebec and the anglophone community in Quebec.

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Here with me today, albeit virtually, is John Lewis, who leads the IATSE in Canada. The IATSE is the largest union representing Canadian entertainment workers, costume and set designers, editors, cinematographers, visual effects artists and virtually all of the crew.


The Canadian Heritage minister and representatives clearly stated that this was not the intent of the bill, but nothing in the text of the act so indicates or guarantees. This concerns and troubles us, even more so given the emphasis placed on flexibility in the Directions to the CRTC issued yesterday.

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We're worried that the regulations will be lowered to the lowest common denominator, that we need to say they can do this, but if they want to get these benefits, they have to use Canadians and use them all the way through. The market is going to look after a lot of it. You have to sell it whether it's Canadian or not. However, we believe, just as we do with so many regulations in this country, that Canadians must be put forward and Canadians must be part of it. Our amendment should ensure that all aspects consider Canadians, and not just the regular ones. We know that in other jurisdictions, like Latin America, the Disney Channel, for example, is obligated to have local content.


CCSA also proposes that the CRTC’s authority to protect against undue preference and disadvantage in the distribution environment be brought into the bill. Both changes respond to the reality of the consolidated broadcasting industry in Canada.

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Online undertakings create global entertainment, and reflect a wide range of viewpoints and experiences. This content is made in Canada with Canadian creativity. It is part of a global content marketplace that has led to foreign investment in production in Canada of over $4/8 billion annually. Almost 90% of the growth in production investment in Canada over the last five years, and more than half of all production in Canada, comes from global studio investments fuelled by these new undertakings.

I don't think that it's attempting to change the behaviour; I think it's attempting to recognize the behaviour. I think that part of the problem that we have is that the Broadcasting Act is still looking at broadcasting as if it were 1992 and not as it is in 2021. It's very much to the detriment of our Canadian broadcasters.


I'd like to remind my colleagues about addressing your question directly. If you name the person, since we are all in a virtual format, it makes it much easier.

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This lack of supervision also affects global platforms such as Netflix, Amazon and Apple TV, which also offer distribution platforms that include applications and services provided by other businesses. Many of those, such as Pluto TV, also offer services including programming guides and linear content.

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One of your member companies, Corus, in their testimony to this committee, said that producers are making record profits while broadcasters are suffering. That was the reason why they want to loosen CanCon obligations, but in their last quarter, Corus recorded a 45% profit margin.

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The CDCE applauded the tabling of Bill C-10 on November 3, 2021, and welcomed the agreement of all parliamentarians to move the bill forward at an accelerated pace. To us, this represented agreement on the urgency to act.

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Many of the people who have appeared before you have referred to our proposals to improve the bill. We have gone to the heart of the matter to ensure that the Broadcasting Act truly allows Canada to maintain cultural sovereignty. The changes that we ask you to contemplate are the result of an unprecedented consensus created by our multi-faceted and eclectic membership. We will respond to the draft policy direction with the same objectives. The Broadcasting Act is not just for regulation; it's cultural policy, and it has to remain cultural policy.

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It doesn't mean that Canadians don't want to watch The Crown on Netflix, it means for Canadian broadcasters that there are some specific stories in Quebec and in the rest of Canada. Those broadcasters know this, and therefore they will address the requirement or the needs of the Canadian population. But if we have over-regulation on top of the purpose of investing at the right place, obviously we're not doing the right thing.

You said in your presentation earlier that the CRTC has the authority under the present act to supervise online distribution services but that power will be withdrawn under Bill C-10. I'd like you to clarify your thinking on that subject because I thought the situation was the reverse.

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Diversity also means diversity of ownership. Ownership of radio and television broadcasters in Canada is held by some major interests. However, independent broadcasters are entrepreneurs that, for example, will invest in platforms that don't belong to conventional niches and thus add to cultural diversity.


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Some argue that Bill C-10 should simply impose the same like-for-like obligations on online undertakings as Canadian broadcasters. This argument implies that nothing has changed in decades, from a time when the Broadcasting Act was designed to limit consumer choice. This approach ignores the many policy benefits that broadcasters have long enjoyed. It doesn’t take into account the very different business models of streaming services, their content offerings, and it doesn't recognize the unique benefits that global studios bring to Canada through investment in production.


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You spoke about cultural sovereignty. You spoke about the need to avoid a race to the bottom. I would like to give you the final word. Can you talk about what we need to do, again, to prevent the race to the bottom, to ensure our cultural sovereignty and to ensure that we hit the balance we need correctly?

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In its submission to you, the CCSA underlines the importance to this committee’s work of the market power of Canada’s own media giants. We support the CCSA’s comments, which echo our own, and the changes the CCSA is proposing in addition to our own. CCSA suggests an amendment to proposed paragraph 9/1(1)(f) to add a reference to contracts between broadcasting undertakings.

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You mentioned that the behaviour has changed of the subscriber, the clients, the customers. What in this bill will change that behaviour back?


IBG recently completed a study that demonstrates some of the problems with Canada's existing broadcasting system. Between 2021 and 2021, some Canadians cut the cord and the base of Canadian subscribers fell by about 6/5%. IBG's study finds that over this same time period, the revenue of non-mandatory, Canadian independent television discretionary services fell faster, by 20%. Meanwhile, the revenue of the large, vertically integrated discretionary services actually rose. The collective per-subscriber wholesale rate for these services increased by more than 20% over this same time period. This is more than twice the rate of inflation.

First of all, all IBG members agree that any ownership has to be part of the law. It can be achieved via directive.


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Yesterday, we learned about the direction that the minister intends to send to this CRTC when the bill is adopted. What was your reaction yesterday when you learned about this letter and this direction?

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