Evidence of meeting #17 for Canadian Heritage in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cbc.
A recording is available from Parliament.
Vice-President, Remstar - TQS
I think you'd get better assurance if you could get a fee for carriage.
NDP
Charlie Angus NDP Timmins—James Bay, ON
Fair enough.
I'm interested in the obligations for the transition to digital. We looked south of the border. There are teams in place between the FCC, the broadcasters, the cable players, the government. They're setting up booths at local fairs, they're going to local church groups to talk about the transition. Here there seems to be radio silence, television silence, in terms of the massive transition that's expected to happen in 28 months.
My question is twofold. Are you ready for that transition? With the massive spectrum sale that will be afoot when the analog spectrum is sold off by the government, have there been talks with the government about getting a piece of that action to reinvest in the digital transmitters and the digital transition that is an obligation on the broadcasters?
Vice-President, Remstar - TQS
On your first question, yes, we will be ready. We're obliged to be ready before other broadcasters, as we're moving and improving our equipment, so we're going straight to digital.
On your second question, there have been talks. I'm not sure if you mean talks directed to the government, but with the CRTC there has been a committee put in place to look at how this transition can be made easier for the consumer.
NDP
Charlie Angus NDP Timmins—James Bay, ON
Are you looking at a piece of that spectrum sale? Is that what you're saying?
Vice-President, Remstar - TQS
No, not the spectrum itself. As a broadcaster we're not looking to purchase a piece of the spectrum.
NDP
Charlie Angus NDP Timmins—James Bay, ON
So you wouldn't be interested in that. Okay. That's perfectly fine by me. I was just wondering, because it seems to me that's going to be a huge piece of the pie.
Co-Founder and President, Remstar - TQS
I think what you were referring to is whether we're in discussion with the government about getting some piece of the sale of the spectrum, and the answer is no, there has been no discussion.
Conservative
Conservative
Dean Del Mastro Conservative Peterborough, ON
Thank you, Mr. Chairman.
I'd like to begin by welcoming you to our committee, Mr. Rémillard, Mr. Porrello. I would also like to welcome Mr. Mario Dumont who is in the room today.
Welcome, everybody. Thank you for appearing before us today.
I found your presentation very interesting, frankly. I think you're presenting from a unique point of view, being a producer, particularly of Canadian content, and secondly now a broadcaster. I find your point of view very interesting. Congratulations, obviously, on building your market share back up. It's encouraging to hear that there is improvement there.
I want to pick up a little bit on where Mr. Angus was with the local program improvement fund. First of all, you mentioned the rules, that they have to be known—I'll get to amounts and so forth in a minute. When CBC was here the other day, they indicated that they would absolutely want a piece of that funding. I don't know whether that's something the CRTC would agree with.
Can you just spell out for me exactly how you would like to see those rules work? I think it is important that this be right.
Co-Founder and President, Remstar - TQS
In our mémoire, we're asking that the local production improvement fund be accessible only to private broadcasters. We believe CBC/Radio-Canada has access to large sums of public funding, which should be sufficient for it to complete its mandate.
Also, as my colleague mentioned, the fund is fairly small. If we're talking about $20 million for French Canada, then we're talking about 33 stations. So that's not a lot of money per station. Imagine if the public broadcaster also were to have access to a significant share of that fund--there would be very little left for the private broadcasters.
Conservative
Dean Del Mastro Conservative Peterborough, ON
I may have mistaken what I heard, but did you indicate that public broadcasters are actually using some of the public funds to directly compete with you for market share? Are they using that as an advantage to compete with private broadcasters for content?
Co-Founder and President, Remstar - TQS
I wouldn't say they're using public funding directly against us, but obviously they're our competitors. They have access to the advertising dollars in our markets. They have two revenue streams: they have advertising and public funding. TQS has only one revenue stream.
TQS is really the poster child for fee-for-carriage, because we're not owned by a cable giant. We don't own specialty channels. Really, we're the only independent network in Canada.
So we are in direct competition with public broadcasters. They have two revenue streams and hence can be more aggressive with the advertising dollars and with the purchasing of programs, plus with the purchasing of American programming. That's what I refer to in our mémoire.
Conservative
Dean Del Mastro Conservative Peterborough, ON
In fairness, the Quebec market is unique compared with the English Canadian market. Frankly, the bulk of the U.S. programming is being bid up by most of our conventional broadcasters. You're not really doing that in Quebec. You're not in a bidding war like two rivals bidding up the value of U.S. network programs. It is unique from that perspective.
This is my concern with respect to fee-for-carriage. First of all, the very companies, the big companies, that are talking about closing private networks also own most of the specialty channels. And I understand why they bought them--because they're profitable. So they're literally doing what I would call “cutting their own lawns”. They're selling advertisements against their own local conventional broadcasters, and they're successful at it.
But my concern is that fee-for-carriage will simply wind up south of the border in a constant bidding war for U.S. programming, because that's where they're making money. I actually think the local program improvement fund can be dedicated to Canadian content, and I'd like to talk about what that fund should be. You've indicated $20 million is not enough. In your opinion, what would be enough? How much do you need to sustain your operations and to put into Canadian content?
What's most important to me and the reason the CRTC exists is to make sure there's Canadian content, so that we're broadcasting a uniquely Canadian perspective on things. That's why it was established. We sit next to the largest exporter of culture in the world, but we're trying to maintain our own identity.
What should that fund be so that you can properly work, so that your business model works?
Co-Founder and President, Remstar - TQS
That's a very difficult question to answer, because, as I said earlier, there are so many unknowns about the calculation method and about who's going to be able to access it.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Assuming we get the rules right, how much money do you need? How much money would you like to get from the LPIF?
Conservative
The Chair Conservative Gary Schellenberger
That can be the next question. I have to move on. I have to be fair with everyone.
Mr. D'Amours.
Liberal
Jean-Claude D'Amours Liberal Madawaska—Restigouche, NB
Thank you, Mr. Chairman.
Mr. Rémillard, thank you for coming today.
Just to give you some context come from the northwestern part of New Brunswick. You know then that TQS also serves my region, more specifically the francophones in my riding, as well as those in other ridings and regions of New Brunswick. That is what I want to talk about.
I was pleased that TQS survived, because when we're talking about transmitting messages, or ensuring that francophones can watch television, TQS certainly has an important role to play in the francophone regions of New Brunswick, regardless of how big that company is.
A little earlier, in response to a question from my colleague Mr. Rodriguez, you said that if you were to receive additional funds, they would serve only to maintain the current content that you must broadcast. In the beginning, you stated that your situation had improved. I understand that things have improved, but there's still something missing. If things are going better and there is still something missing, that means that even if there were additional funding there would be no extra content for the regions. The money would only serve to meet your minimum obligations with respect to Canadian content and regional service.
Did I understand you correctly?
Co-Founder and President, Remstar - TQS
What I wanted to say earlier... Obviously things are better, the recovery of TQS is an encouraging sign. I mentioned that the recovery had not yet been translated into dollars. TQS is still in financial difficulty because it is emerging from a significant financial slump. It is still running a deficit.
I meant that if we had access to additional funding, even though we do not currently foresee increasing our local programming, we do definitely foresee increasing the quality of the services we provide to our public.
That means being able to meet our obligations and increasing quality. We believe in local programming and we want to do high-quality programming. So we will be heading in that direction.
Liberal
Jean-Claude D'Amours Liberal Madawaska—Restigouche, NB
That direction... You truly want to guarantee what you are offering but with better quality? You've been talking about quality. Quality is one thing but you're already providing programming—
Co-Founder and President, Remstar - TQS
Local programming, absolutely, yes, we—
Liberal
Jean-Claude D'Amours Liberal Madawaska—Restigouche, NB
What do you mean by quality? Are you talking about a better image, the quality of—
Co-Founder and President, Remstar - TQS
Content quality, obviously. We want to offer top-notch content. We are in the content business. Quality content is obviously very expensive. You know, everything boils down to cost.
For now, we do not even foresee increasing our commitments, because we're having difficulty just meeting the ones we have. We want to be able to meet our commitments; we want an additional source of funding that would allow us to offer high-quality programming throughout Quebec.
Liberal