Standing Committee on Canadian Heritage on the Future of Television in Canada

Ottawa, Ontario
April 29, 2009

Introduction

I want to thank the Committee for inviting me here today as part of your study on the future of television in Canada.

Given the structural shift the broadcasting industry has been undergoing, and the global economic situation, this study is particularly timely. And I welcome your efforts to delve into this issue.

The impact of the current situation on our television industry ... in fact the broadcasting industry in general ... is high on my list of concerns.

The Terms of Reference for the study at hand speak to the tremendous complexity of the situation facing Canadian broadcasting.

As everyone in this room knows, the Canadian broadcasting system is unique. The challenges of geography, language, and proximity to the largest cultural exporter in the world, have shaped our system. It broadcasts in Canada's two official languages, and also provides space for a host of minority-language services, including shows in Aboriginal languages.

The English and French markets have distinct challenges and opportunities. Where Canadian English-language programming faces tough competition in the domestic market, it is more readily exportable. On the other hand, home-grown French-language programming is highly successful and has far fewer foreign competitors, but it also has fewer export opportunities.

Canada has a well-established broadcasting system that makes an important contribution ... both to our society and to this country's economy. Nevertheless, this system is undergoing a period of significant transformation. And in recent years, the pace of change has intensified. Technology has forever changed the way we create, access, and use content. Digital technologies are offering Canadians an unprecedented abundance of choice in terms of how and when they obtain information and entertainment.

And as we have seen over the last few years, while many of these new technologies bring the promise of new services and content, they sometimes also supplant existing products and services and cause disruption and instability in the traditional industries.

Consumers have adapted to the new environment. We've embraced our PVRs, our smart phones, and the Internet. Canadians are moving toward more interactive experiences. Experiences with content creation and access are becoming richer, more meaningful, and relevant. New Canadians are using the new platforms to share their stories, engaging with fellow citizens and facilitating cross-cultural understanding. In essence, new technology is providing Canadians with new opportunities to participate in our society.

And at the same time, Canadian companies are adapting. Traditional competitors are partnering, merging, and exploring new business lines and strategies. We've seen the development of converged media companies involved in a wide spectrum of telephone, cable, satellite, broadcasting, and Internet services. There are lower barriers to entry, which means opportunity for competition from new entrants.

The current economic situation is clearly having an impact on the broadcasting industry. As your current study clearly indicates, conventional television broadcasters are facing challenges. However, other stakeholders, for example pay and specialty services, continue to experience strong growth in revenues and profitability.

In today's environment, consumers want what they want, when they want it, and how they want it. And businesses are in the process of adapting to the changing consumer and business environments.

And against this setting of unprecedented transformation within the broadcasting industry, our Government has played and will continue to play a strong role in this changing industry. And as always, we will place Canadians at the centre, as citizens, as consumers, and as creators.

Government Support for Public Broadcasting

At this point, I would like to speak about our Government's support for public broadcasting.

As the Minister of Canadian Heritage, I have taken every opportunity to express my support for a strong national broadcaster that serves the interests of all Canadians.

And as the Minister of Official Languages, I am sensitive to the important role Radio-Canada plays for Francophones in Canada. In fact, it operates the only French-language national radio and television networks that are offered to all Francophone communities, across the country.

I am proud to say that CBC/Radio-Canada is one of our Government's biggest investments. By giving CBC/Radio-Canada more than $1 billion a year, I believe the Government of Canada provides adequate funding for our public broadcaster.

As well, since 2001, CBC has received an additional $60 million for Canadian programming ... funding that has been renewed several times, including for this fiscal year.

Like other Canadian broadcasters, CBC/Radio-Canada has had to make a number of difficult decisions. Last month, the Corporation's CEO and President Hubert Lacroix announced actions that would be taken to deal with the current situation.

The Government of Canada will work closely with CBC/Radio-Canada to ensure that it remains a strong national broadcaster, and that it reflects Canadian diversity, protects our official languages, and is a platform for Canadian content.

Government Support for Private Broadcasting

Our Government supports broadcasters because we understand that they provide a public service to Canadians in the form of news and other content that informs, enlightens, and entertains.

While the current situation poses challenges, it also brings opportunities for our broadcasting industry ... for stakeholders who take an innovative approach to meet the needs of consumers and the conditions of the current economic environment.

There is tremendous opportunity for Canadian broadcasters to harness these new trends in digital technology, to become more innovative and consequently more profitable. The efficiency of digital technologies and the dropping prices should leave room for effective solutions.

In the meantime, our Government has provided and continues to provide strong support to the industry.

For example, last month, I announced the creation of the Canada Media Fund. Our support of 134.7 million dollars per year over two years, along with the additional financial contribution that cable and satellite companies make to the Fund, will bring the combined investments to more than 310 million by 2010.

The new Fund will support the industry, Canadian content, and official-language minority communities. It will help provide the content Canadians want to watch on their preferred platform ... whether it's television, the Internet, smart phones, or mobile devices.

The Canadian Television Fund and the Canada New Media Fund will continue to operate for fiscal year 2009-2010, and the Canada Media Fund will be in place by April 1, 2010.

Our Government also supports the Canadian film industry, which provides important content for our broadcasting industry.

In 2008, we invested more than 300 million dollars in the audiovisual production industry through the Canadian Film or Video Production Tax Credit and the Film or Video Production Services Tax Credit.

As well, in 2007-08 we provided approximately 90 million dollars through the Canada Feature Film Fund, which supports the development, production, distribution, and marketing of Canadian feature films.

Last year alone, more than 40 feature films were created thanks to this fund. And it triggered an additional 153 million dollars in feature-film financing from other public- and private-sector sources.

Conclusion

The Canadian broadcasting industry has played a critical role in telling our stories and shaping our national identity, and it will continue to do so.

The Government of Canada provides significant support to both our private and public broadcasters, and we will continue to be a strong supporter of the Canadian broadcasting system.

We believe there are opportunities for the Canadian broadcasting industry. And if we look at companies like RIM and Lionsgate productions ... it's clear that Canadians have the capacity to lead the way with new technologies.

Canadians deserve quality, choice, and access to services at fair prices. They need to continue to find deep value in a broadcasting system that has served them well throughout the years.

As for industry stakeholders, I have no doubt that meeting the needs of the public will drive them as they look at innovative ways to reengage the market ... to deal with the longer-term transformation that is happening.

Moving forward, the Government will do what it has always done. We will put Canadians first, as citizens, consumers, and creators.

In closing, I want to once again acknowledge the important work the Standing Committee on Canadian Heritage is doing. The wide-ranging witnesses you're hearing from represent a dynamic, evolving, and complex industry. I look forward to what I know will be an interesting report.

Thank you.