Canadian Heritage Committee on April 20th, 2009

[Pierre Karl Péladeau]

I'm sorry, but I don't know what you're referring to, because we don't have any local station in Hamilton, or—

[Charlie Angus, NDP, Timmins—James Bay, ON]

Well, there's the CKXT station in Toronto, SUN TV, of which the CRTC asked how you reflected the region, including Hamilton.

[Pierre Karl Péladeau]

In Hamilton?

I'm sorry, sir, but I don't have any clue what you're asking about.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Okay. I'm looking at a submission that I thought was from you.

But you want to go down to five hours a week of original content there. The rest of the programs are repeats. Again, if conventional television is broken, it seems to me that it's broken because there's not enough investment in making people actually want to watch the shows. Why would they watch if they're only getting five hours?

[Pierre Dion]

The only thing I can say, sir, is that SUN TV is a very, very, very small station. We have one grid and we're trying to do our best, and we are losing a lot of money right now.

[Charlie Angus, NDP, Timmins—James Bay, ON]

When we met in 2007 about the decision by Vidéotron to pull out of the Canadian Television Fund unilaterally, you had a number of concerns. You didn't believe in a public fund. Luc Lavoie called it a socialist and ideological approach. You wanted to keep the money coming from Vidéotron and be able to use it for in-house, video-on-demand services. That was your argument at the time.

Now we've redone the fund, so now it's in-house. It can be for video-on-demand, and it can be for multi-platform. Your number one competitor for TVA in Quebec, Radio-Canada, no longer has a dedicated fund. So you're sitting at the table, but the other broadcasters aren't; the independent producers aren't.

How do we know that the Vidéotron “hat” isn't going to be there for the TVA “hat”, when everybody else, it seems, has basically been booted off the board?

[Pierre Karl Péladeau]

What was your question, sir?

[Charlie Angus, NDP, Timmins—James Bay, ON]

Well, my question is simple. With the new media fund you guys are like the last men standing. There are no broadcasters. There are no independent producers. They've all been kicked off. You've now got a fund that is set up exactly the way you wanted it when you pulled out unilaterally. You're able to use it for in-house without using independent producers. You're able to do it multi-platform, so you're a video-demand service. But you're doing this at the table, as Vidéotron, and yet you've got TVA on all your internal services.

How do we know you are going to be making decisions--with public money, on this very, very small board now--that are going to reflect the public good and not your bottom line?

[Pierre Karl Péladeau]

At this stage, there are no such rules. There are no details about who is going to sit around the table.

[Charlie Angus, NDP, Timmins—James Bay, ON]

But there are only five. Everybody else has been kicked off.

[Pierre Karl Péladeau]

Yes, but probably that's because there were too many previously.

[Charlie Angus, NDP, Timmins—James Bay, ON]

But you're still there.

[Pierre Karl Péladeau]

Yes, and we have the right to be there because we're one of the biggest contributors of Canadian programming.

[Charlie Angus, NDP, Timmins—James Bay, ON]

But you're also going to be receiving from it directly. The issue is how you protect against conflicts of interest.

[The Chair, Conservative, Gary Schellenberger]

Mr. Angus, we've gone over a minute here.

We're going to move now to Mr. Bruinooge, please.

[Rod Bruinooge, Conservative, Winnipeg South, MB]

Thank you very much for your testimony so far. It is good to hear various opinions. We've had a number of opinions today. Clearly there are a lot of different viewpoints on some of these matters, and I appreciate your bringing them to our attention.

First I want to thank your company, and of course you, Mr. Péladeau, for the various representations you made in relation to some of the changes we made to the Canadian Television Fund. I know that Mr. Angus has a different opinion on it, but we see some of the changes as improvements to the model and efficiencies that needed to be brought into place.

How have these changes changed some of your viewpoints on the fund, and do you see it as perhaps a more ideal model today? Could you speak to that for a moment?

[Pierre Karl Péladeau]

Absolutely.

Again, I think the Canadian media fund recognizes that the Canadian landscape has changed dramatically in the last few years. They recognize that the market is more fragmented. They recognize that there is more and more of an audience who is watching television on other than conventional TV sets. They're on the Internet, and in the future they will be on mobiles.

They recognize the existence and growth of the other distribution channels. That being said, I think they will be well positioned to make sure we will be able to have content on those new multi-platform distribution channels other than American programming. Canadian will be there. We'll have the chance to figure out what those new channels are all about. We will continue to grow in the existing industry, which is very strong and which we would like to be strong in the years to come.

[Rod Bruinooge, Conservative, Winnipeg South, MB]

Building on that point in terms of some of the new broadcast mediums--new mediums, in general--that are available to consumers throughout our country, and going back to your initial comments, you did talk quite a bit about the capacity of the CRTC to understand the changing industry. You went on somewhat at length on this topic.

What recommendations can you make at this time to perhaps improve the CRTC so it is able to deal with the rapid changes you've spoken about?

[Pierre Karl Péladeau]

We've been loud and clear in front of the commission about the regulations. Again, this industry has been regulated since its inception. We now live in an environment where consumers and citizens have many other alternative choices, which was not the case previously. Recognizing this fact is an important matter.

[Rod Bruinooge, Conservative, Winnipeg South, MB]

You spoke a bit about broadcasting on all platforms. Your company has an interest in being able to do that. Could you speak a bit more about how you would achieve that? What platforms in particular would you like to see added?

[Pierre Karl Péladeau]

One good example we can mention is what I referred to earlier in my presentation, about Star Académie, which is the biggest show right now on television. To be able to invest the amount of money we've been investing in this show, which offers the chance to talk about Canadian culture, Canadian singers, the Canadian production system, we need to make sure that we will be able to move this content in many other platforms. If we are successful in achieving an audience of three million, it is because we have the capacity to distribute this content on many other platforms. This is probably the best example, because this is the larger audience, but that doesn't mean we cannot create the same kind of pattern elsewhere with other programming. This is what we're working on, and we would like to continue to move forward in this direction.

[The Chair, Conservative, Gary Schellenberger]

Thank you.

Mr. Simms.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Thank you.

Mr. Péladeau, thank you very much for your submission. I'm very interested in what you had to say. As you mentioned earlier, there are varying degrees of differences from the prior witnesses from Rogers. I'm not quite sure if you're at opposite ends of the spectrum. Nonetheless, what I want to zone in on is the issue of the fund itself, the local programming improvement fund. Would I be right in saying that the local improvement fund is a model that you would embrace before getting into regulatory changes such as fee-for-carriage?

[Pierre Karl Péladeau]

Yes, we mentioned that we were looking to have more drastic solutions. The point we made in front of the Canadian Television Fund and the CRTC is that we would be ready to invest a dollar more of our actual contribution to the Canadian Television Fund if we had the right to use this content on all our platforms.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

So where's the local commitment there? In the title of our study we talk about local communities. What is your commitment, based on what you extract from that fund, to the local community?