Canadian Heritage Committee on April 17th, 2007

[Raoul Bhaneja]

The thing that seems obvious to me is that if you're in a culture that's producing television and you are directly next door to the largest producer of television on earth—being Hollywood—and while I think we love the idea of the quality of Canadian television being one that could compete internationally, that could be an export product, I think we also face the basic reality that anything made in Hollywood has an upper hand because of the ability for it to be promoted through American networks, through all the entertainment media.

I don't think any of us feel that Canadian content isn't up to the challenge of meeting an excellent international standard of quality, but at the same time, to think that Canadian production could exist without the aid of our federal government to help us try to compete in this world, it's not going to be possible without the help of our federal government.

[Chris Warkentin, Conservative, Peace River, AB]

No, certainly, and I didn't want to leave that indication. I certainly believe we have the best actors here in Canada. We have the best producers. There's no question that we have quality folks. We just need to figure out how we're going to be superstars, even on the international scene, moving forward, especially when we look at the new media and different things. Thank you very much for your contribution.

[The Chair, Conservative, Gary Schellenberger]

Thank you, Mr. Warkentin, for that.

Just before we go around for some short questions, I would like to ask the question I asked the previous witnesses.

Again, I will repeat, when Richard Stursberg from the CBC was here, he said the CBC offered independent producers a deal where the corporation would put content online and divide any revenues 50-50 that came as a result. The offer was not accepted. Why have independent producers and the CBC not been able to reach an agreement on this, and when will the CBC and independent producers reach an agreement to put content online? It's a question that has circulated around for a wee bit.

Secondly, I understand that Little Mosque on the Prairie is now made or produced in Hamilton.

[Arlene Duncan]

It's made in Toronto and Saskatchewan.

[The Chair, Conservative, Gary Schellenberger]

It's in Toronto. So it's not made on the prairies anymore.

[Arlene Duncan]

It's made in both Saskatchewan and Toronto, so both provinces are working.

[The Chair, Conservative, Gary Schellenberger]

Okay, good.

Could I get an answer on that first question?

[Richard Hardacre]

New media, or other media, or whatever you would like to call it—sometimes we call it digital media and sometimes we call it Internet—is very complex. We appreciate the question because there is no simple answer to it. It's a very complex situation.

We supported the independent producers when they were speaking with the CBC about their right to share in revenues from broadcasts over new media.

I don't want to reiterate the pain of ACTRA's strike, but the main reason this union took its first strike in our history was because we had Hollywood studios telling us that the contract they wanted to sign would mean no revenue to performers for performances that are exploited or used in other media. We had the leading executives from labour relations at Disney and Sony tell us to our faces that there would be no revenue for us in those formats, as far as they knew.

The day after we called our strike, it was announced that you could buy any Disney product from a beginning library of 3,000 titles. You could buy any of them from a Wal-Mart website. It was the day after our strike was called. It was in The Wall Street Journal.

They knew very well there was going to be revenue from new media. The problem was they didn't know how to share it. They didn't want to share anything, but we proposed that we'd actually study the problem for a year. This was the union and all the producers, including representatives from the Hollywood studios. They wouldn't hear anything about it. They wanted our performances, as they said, in perpetuity, worldwide, for free. We couldn't do it.

CBC has a similar dilemma, and CBC has told us that. They have negotiators that we've been working with too. We have a contract with the CBC, but it expired two years ago. We're still working on an old contract. For the last two years we've been working on trying to hash out how there will be some compensation.

We're really talking about pennies. We're talking about pennies trickling in that add up to dollars and how the metre would tick in order for the use of our work alone. We're not talking about the writers, or directors, or anything. W're talking about the performers' work and how it will be compensated for new media. The CBC does not have a proposal on it because it is such a complex world and no one knows what the value of it is going to be.

The way we succeeded with the independent producers was to say if you don't earn anything, we're going to get a percentage of nothing. We want 3.6% of the distributor's gross revenue that comes from new media. It's what we achieved. The figure was not arbitrary, and it took some negotiation, but it's 3.6% of all distributors' gross revenue. It satisfied the big studios because they said that if they had zero revenue, they'd pay 3.6% of zero.

But we already knew a day after the strike was called that it wasn't going to be zero revenue. They were selling 3,000 films through Wal-Mart, and Sony is selling thousands of titles through Amazon.com.

I'm sorry that my answers are sometimes more complex than you would wish, but the new media world is a new frontier. I don't want to sound cliché, but it is definitely a new frontier. How anyone with intellectual rights is compensated is a very new frontier.

We propose that we will work on it with the other unions involved and with the CBC in the way that we've done it with independent producers. We only wish the CBC management would sit down at the table to discuss it with us. They've been avoiding it for a year now.

[The Chair, Conservative, Gary Schellenberger]

Thank you.

Ms. Fry.

[Hedy Fry, Liberal, Vancouver Centre, BC]

I have a quick question that actually dovetails with the chair's question because it is about new media or digital media.

I was going to ask whether ACTRA had decided to work on analyzing the new ways in which we're going to have to deal with copyright in digital media, because I think it's time to review the Copyright Act and look at how it works in today's medium. I was going to ask you how you intend to do it, but you've said you intend to do it. I think it's important.

As you pointed out so well in your presentation, I think the CRTC should really revoke its new media exemption order. There is a tendency for the CRTC to have in camera consultations a lot now. If the CRTC had looked at the issue of new media in a public consultation, they would have been able to move forward and grasp that they clearly need to look at how to deal with new media and how to look at copyright. I think those things are absolutely necessary.

I hear over and over that the problem isn't so much that Canadian content isn't good enough, but it's that we can't distribute it. New media will provide the distribution.

How do you see those three things working together, distributing Canadian content through new media internationally, dealing with the Copyright Act, and the third part, actually getting the CRTC to look at digital media?

[Richard Hardacre]

Those are very useful questions. Ken Thompson is going to respond.

[Ken Thompson]

Thank you, Ms. Fry. The first thing, working backwards, is that the CRTC just yesterday announced that they are going to hold hearings to review new media. ACTRA has been asking them to do that since about 1999. Previous presidents, and Richard Hardacre, have all been before the CRTC and have repeatedly asked for a review of new media. And why would we want to do that? Because we need some regulation to ensure that there will be Canadian content for Canadians to see on the new media.

On your question about copyright, it's very complex. The last revision of the Copyright Act was in 1997, so we're just about due. They come along about every 10 years. We're just about due for one. There was a bill under the Martin government, Bill C-60. It offered up some new rights for performers, but you would be shocked to know that performers have no intellectual rights to their recorded performances on television and in movies. They have no way of pursuing those rights. They have no way of enforcing any kind of piracy of those rights. And that has to change. That's one of the things. And the government has promised to do that since the early 1990s.

Your final question was.... Oh, there was the distribution of digital media. You know, if any of us here knew exactly how you would distribute, we would be out on the stock exchange. We'd be putting out our IPOs. You can see that the record industry has struggled with this for years, and the film and television industry will.

Everybody is learning as they go along. There are all kinds of ways. There are technical ways, like streaming as opposed to downloading. Streaming allows you to, in essence, watch television or movies or video programs on the Internet. There's Internet TV. Downloading allows you to obtain a copy. But there are some intellectual property rights that are invoked in either of those two methods. There are tethered downloads, like rentals, where you can pull it back after you've actually received the copy, so it's time limited. You'd have access to a television program or a movie for a couple of days or even for a couple of hours.

So there are all kinds of models out there, and as Richard said, it's very complex. Everybody is very concerned about how they would go about doing it to ensure that they would get some kind of return.

[The Chair, Conservative, Gary Schellenberger]

Okay. I thank you very much for those answers. I thank the committee and our witnesses.

Yes, Mr. Hardacre.

[Richard Hardacre]

I have one final comment, if I may. We recognize, ACTRA sincerely recognizes, the weight of responsibility on this committee on heritage. It's a very important committee, not only for us but for the country. We know that, and we indeed appreciate your efforts with this very difficult challenge, and we sincerely appreciate the opportunity to speak with you today on this, and we look forward to future opportunities as well.

[The Chair, Conservative, Gary Schellenberger]

Thank you very much.

The meeting is adjourned.