Canadian Heritage Committee on May 4th, 2010

[The Chair, Conservative, Gary Schellenberger]

I did not introduce Mr. Piché from Library and Archives. I'm sorry about that.

Now we move on to the Writers Guild, and Maureen Parker and Kelly Lynne Ashton.

Maureen, could you go ahead, please?

[Maureen Parker, Executive Director, Writers Guild of Canada]

Good morning, members of the heritage committee.

My name is Maureen Parker and I'm the executive director of the Writers Guild of Canada. Also with me today is Kelly Lynne Ashton, WGC director of policy.

The WGC welcomes this opportunity to appear before the Standing Committee on Canadian Heritage. The Writers Guild is the national association representing more than 2,000 professional screenwriters working in English-language film, television, radio, and digital production. Our members are on the forefront of the creation of cross-platform, convergent, and transmedia content.

Screenwriters are today's storytellers. As such, they welcome these new opportunities to entertain, but they are also worried about the challenges and about how they and we, as Canadians, are going to meet those challenges. We are appearing before you today to urge you to support a comprehensive national digital strategy to help screenwriters meet these opportunities and challenges.

A national digital strategy must first ensure that there is sufficient funding to create professionally produced digital entertainment; second, it must ensure that Canadian-owned and Canadian-controlled enterprises exist to support Canadian content, and that they have appropriate incentives or requirements to do so; and third, it must amend the Copyright Act and support terms of trade to ensure that fair revenue streams flow back to content creators.

First we'd like to talk a bit about what our members are actually doing in digital media. They are taking advantage of a variety of new creative opportunities. They write webisodes such as the ones for Little Mosque on the Prairie, in which characters from the television series extend the experience through additional stories. They also write original web series, such as the award-winning My Pal Satan, which is about what life would be like if your roommate were Satan.

My Pal Satan is an example of how digital platforms allow screenwriters more creative freedom. Our members not only write for linear formats but also for interactive games such as Autotopsy, which is an extension of the television series Crash and Burn.

Screenwriters are experimenting with the convergence between story and game, and some members are breaking new ground with innovative new forms of storytelling, such as the Twitter soap opera Crushing It. By the way, we know that you do not have time right now, but we'd be happy to stay after the meeting and show you a few of these examples on our laptop.

Canadian screenwriters are interested in developing new methods for reaching audiences directly, without having to go through broadcasters. The online world offers very quick feedback from audiences. This allows writers to respond immediately, as they can incorporate ideas as they continue to create.

Also, the lower cost of digital production means that screenwriters can become digital content producers, overseeing all aspects of production in a way that just cannot be done in traditional broadcast television. Screenwriters now have control over their stories all the way through production to delivery to the audience.

Digital platforms also offer more opportunities for the distribution of traditional television programming as Canadians migrate their viewing to online platforms. Canadian television can now be viewed on broadcasters' websites and cable companies' online portals, and it can be downloaded to own through iTunes. Unleashed from the broadcast schedule, more Canadians will get a chance to view Canadian programming.

The primary challenges for everyone working in this digital world come down to money. There must be more money to fund new digital production and fair compensation for the exploitation of both new digital content and traditional television content.

Let's start from our very basic principle that screenwriters and artists need to be paid for their work and need to earn revenues from the exploitation of their work. We look first to our collective agreements and individual contracts to set minimum fees and identify revenue streams. We need to be flexible in collective bargaining and contract negotiation to take this new digital world into consideration.

Online business models are in flux, so it's difficult to identify where and how those revenues will flow. This is our challenge as a guild. What we cannot address alone are lost revenues from common consumer uses such as illegal file sharing and saving to hard drives, which are currently not allowed under the Copyright Act and not compensated for.

We don't want to stop these uses, but rather make them allowed uses for consumers and put in place collective licensing to compensate creators for those uses. There has to be a balance between consumers and creators.

It has been suggested by some that fair dealing be expanded to include these consumer uses. While this solution decriminalizes this common behaviour, it also eliminates revenue streams to creators. We therefore oppose the expansion of fair dealing or other exceptions to copyright infringement except in those specific cases, such as allowing for parody and satire, where it makes sense. Of course we agree that the definition of fair dealing and other exceptions to copyright infringement should be technology-neutral and not so specific as to require amendment again when technology evolves, but they should also not be so vague as to allow every use imaginable under the name of fair dealing.

Another challenge is that the lack of revenue flowing to screenwriters from online distribution is not just limited by things like illegal file-sharing. Broadcasters are demanding more rights from producers for the same licence fee. For example, if a broadcaster exploits a TV show through iTunes downloads, in most cases the broadcaster keeps that revenue, and it is not shared with the production community. We support a terms of trade agreement between the broadcasters and the producers, because without it no one but the broadcaster earns revenue from these new uses. We will be working with independent producers to ensure that compensation flows equitably to the creative community.

Kelly Lynne.

[Kelly Lynne Ashton, Director, Industrial and Policy Research, Writers Guild of Canada]

Without adequate production financing, Canadians will not have the choice of sufficient professionally produced Canadian digital entertainment media. Yes, the costs of content creation have dropped so low that anyone can be a content creator. But it is the production costs that are dropping--cameras and editing equipment and software. The content is still amateur if unskilled amateurs are writing and performing in it.

My 13-year-old daughter has a YouTube channel, as do many of her friends. Jacob Glick from Google has appeared before you and told you that there is plenty of Canadian content on YouTube. He is counting my daughter's videos, and while I think she's very talented, I'll be the first to say that she is not a professional and her audience is somewhat limited. YouTube can be an inexpensive way to distribute content directly to consumers without the broadcaster as a gatekeeper, and our members are increasingly interested in this opportunity. But amateur content is not a substitute for professionally produced Canadian content. Canadians deserve better. Without government support, Canadians will have no choice but to enjoy the vast amount of U.S. professionally produced content that is online.

We welcome the changes to the Canada media fund that require content on more than one platform. However, as a result, the CMF now requires that broadcasters, producers, and content creators do more, by creating content for more than one platform. Under the new CMF, every TV show it finances must be accompanied by content on a digital platform, such as streaming the TV show, building a simple brochure site, or, for at least 50% of a broadcaster's CMF programs, building value-added digital content.

While the first two can be easily financed by the broadcasters themselves, value-added content requires third-party financing in addition to what is being provided by CMF and broadcasters. There simply isn't enough money in the system to cover the shortfall. The answer is not to reallocate more money from broadcast to digital content, either. We cannot compromise the quality of our television content. We must remember that the bulk of viewing is still to TV. According to a recent Nielsen study in the U.S., 99% of screen viewing is still TV, and according to the CRTC's annual communications monitoring report, an increasing proportion of viewing of video online is of traditional TV. Private sector investment is not a viable alternative, as there are not yet any secure business models available to guarantee a return. Yes, there have been a few online successes, such as Club Penguin and Justin Bieber, but they are the exception to the rule.

What do we need to ensure a Canadian presence in the digital world? We need the government to extend the current Canadian film or video production tax credit to linear original web series so that online distribution on a Canadian-owned site also acts as a trigger for the tax credit. We also recommend that the government create an interactive digital media tax credit modelled after several successful provincial digital media tax credits. However, to ensure that such federal funds support Canadian talent as well as producers and crews, there must be a Canadian content certification system for digital media, similar to CAVCO. The WGC has been recommending that the top five highest-paid creative talent must be Canadian, in addition to current funding rules that require that 75% of costs are spent in Canada under Canadian ownership and control of the project. This should not be hard to do.

We also need the ISPs, like Rogers and Shaw, to make an appropriate contribution to Canadian content under the Broadcasting Act. They are not dumb pipes. For one thing, due to graduated fees, ISPs earn more revenue when consumers download more rich media content. With our colleagues in the independent production community, we recommended to the CRTC at their new media hearing last year that ISPs make an appropriate contribution to the creation of content that they carry, through a levy. Even though the CRTC chose to extend the new media exemption order and not impose a levy, we still see the need for ISPs to make a contribution to the creation of the Canadian content they benefit from.

We look forward to the government's public consultation on the national digital economy. We will look to ensure that any national digital strategy includes an updated Copyright Act; terms of trade; expansion of the Canadian film or video production tax credit and creation of an interactive digital media tax credit; maintenance of Canadian ownership and control requirements on telecommunications and broadcasting.

We thank you for your time and look forward to answering any questions you may have.

[The Chair, Conservative, Gary Schellenberger]

Thank you.

My finger didn't work, but that's okay. You were only a little over time.

First question, Mr. Simms, please.

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

Don't worry. He won't resist giving me the finger, so don't worry about it.

Ms. Parker, it's good to see you again.

I have a few quick questions here. Correct me if I'm wrong, but what you're looking at is a revenue stream that you believe, under the current regime, should be shifted to other platforms. Is that too general a statement to make?

[Maureen Parker]

It's not too general, but I guess to clarify a little bit, what we're really looking for are amendments to the Copyright Act. Those have to be made first in order to extend the private copying regime for artists of audio-visual works. We need to amend the Copyright Act to ensure that the uses that are currently illegal and are copyright infringements.... That needs to be corrected.

As the union representing creators, we want to ensure that our members' work can be distributed in various forms. We're not trying to stop that. That's what our members want. We want to be able to show you what we have, and you can store it on your PVR. We want you to be able to--Kelly Lynne had some other examples--use EOD and so on, but the bottom line is that we're not compensated for those uses. That's why we need to amend the Copyright Act first.

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

Recently there was a huge fuss, a highly publicized fuss in the United States by writers. They went on strike. And from what I understand, the crux of the issue was the money that the bigger companies, the distributors, were getting through digital. Is that correct?

[Maureen Parker]

That is correct.

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

From that, have we learned anything, or have we seen anything that's going to tell us how we get revenue in the future? For example, two days ago I downloaded a movie. A lot of Canadian money, government money and taxpayers' money, went in to produce it. The name of the movie is Rare Birds, the one made in Newfoundland. I downloaded it through iTunes. So explain to me--

[Maureen Parker]

That's a very good question. That, unfortunately, has an even different answer. Those rights--

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

Could you address the American thing first?

[Maureen Parker]

Okay. The Writers Guild of America did go out on strike approximately two years ago over compensation for digital production. However, their system is quite a bit different. They were really looking for expansions to their collective agreement. They were looking to ensure that they were properly compensated for their traditional TV fare—things produced under their collective agreement, which are now distributed on the Internet, as well as original digital writing. The big strike issue was following the money flow for television content on the Internet. That is not what we're talking about up here.

Up here we have a collective agreement as well, with independent producers. So let's just talk about your iTunes, because it all connects. Our collective agreement looks after something called primary uses. Our job as a union is to negotiate on behalf of our members with their contractors, the independent producers. Independent producers then make arrangements and licensing deals with broadcasters. All of that creates money flow—revenue flow. Our deal with the independent producers covers things like sales and downloads—iTunes downloads. Those are covered between the writers and the producers.

However, the wrinkle is that when broadcasters purchase a television licence, they're acquiring every right, including iTunes downloads. So they're paying the producers, let's say, $500,000 per episode, and that will cover all rights. That revenue flow stops there. There's no money to the producer. There's no money to the writers. There's no money to the actors. There's no money to the directors. The revenue is cut off. That is an issue called “terms of trade”, and we're dealing with that at the CRTC. The chair has told the broadcasters that they're not to apply for licence renewal next year unless they have draft terms of trade agreements in place with independent producers.

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

You're confident that this is going to work itself out in a way that will be satisfactory to you?

[Maureen Parker]

In this particular issue, we certainly expect that the broadcasters will have to make fair deals with the producers. Then it's up to us to ensure that money flows back to creators.

[The Chair, Conservative, Gary Schellenberger]

We now move on to Madame Lavallée, please.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Thank you very much, everyone, for being here today. I'm going to start by putting a question to the Writers Guild of Canada. It's not for lack of interest in the library, on the contrary, but I only have five minutes, and I'm going to try to see what I can do.

You at the Writers Guild of Canada have a talent for raising major problems, among other things, when you talk about having all the funds necessary for production; about ensuring that Canadians retain ownership of broadcasting and telecommunications businesses; about amending the Copyright Act, and the fact that you suggest there be contributions by the ISPs. I assume that's the FAIs in French, the fournisseurs d'accès à Internet.

I don't know which issues to start with, but I'm first going to talk about Google. Ms. Ashton, you said that what Google was doing was very good for people who used it as amateurs, if I may put it that way. Despite all the excellent work that represents, the fact remains that the money won't go to professional artists, that is to say to the people who live from their art or who are trying to live from it. I don't know whether the parallel I'm going to draw is a good one; you'll tell me. Thirty or 40 years ago—I'm not as old as that—some artists were invited to appear on stage and were told that, since they were going to become well known, there was no need to pay them. I've heard that so often it's hopeless. I don't think there's any difference between that physical stage I'm talking about and Google. So I want to know what you think of that.

[Maureen Parker]

Just to clarify the question, is it whether the same rules the performance artists have apply? Is that the question?

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

I'd like to hear your comments on the fact that Google is distributing a lot of Canadian and Quebec content but that it's amateur content, if I can put it that way. Furthermore, professionals can't use it as a real stage because they have to find financing and earn income from their work.

[Maureen Parker]

It's absolutely two different forms of content, Madame Lavallée. You're absolutely right.

What we're talking about is content created by professionals. These are not kids creating in their bedrooms or downstairs. That definitely has a place, and it's entertainment. But what we're talking about are professionally trained artists. They are the people who have chosen to do this as a career, and the content they create is also not being compensated for.

When you listen to people like Jacob Glick talk about the overabundance of content, they're not talking about professionally produced content; they're talking about amateur content. That's fair. As we say, it has a place, but it's not the same thing. Yes, there are certainly Canadians who are being highlighted, such as Justin Bieber, as Kelly Lynne was mentioning. Their success does happen, but it's extraordinarily rare. He was an amateur artist. But he was discovered by another professional, by the way, who actually assisted and mentored him.

It has its place. Google is a wonderful tool, but it's not the same as providing Canadian content through what we call affiliated media broadcasters--that would be CTV.ca and so on--and ensuring that there's professionally produced content available for Canadians.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

I'd like you to tell me how the ISPs, the Internet service providers, could make contributions to Canadian content.

[Kelly Lynne Ashton]

When we talk about an ISP levy, this would be under the Broadcasting Act. All carriers of the content should make an appropriate contribution to the creation of the content. That was our argument in front of the new media hearings. There are still outstanding issues on that in front of the Federal Court, so I'm really not in a position to talk about the issue of jurisdiction, but we still believe that ISPs should have an obligation to contribute to the content they carry.

[The Chair, Conservative, Gary Schellenberger]

We're almost at five minutes.

I'm going to move on to Mr. Angus, please.

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

Thank you, Mr. Chair.

Both presentations have been fascinating.

Mr. Caron, I was very interested in what you mentioned about the digitizing project with the Inuit. I'm a big believer in digital archives. I worked with the Algonquin Nation in Quebec; we did a photo thing, and it was really empowering to have kids bring their grandparents' photos, and we started to identify people. All across Canada I see digitizing projects and museums and phenomenal collections, but what I don't see is an overarching narrative that makes it possible to access all these works with key search words. When a small museum hires three students for the summer at nine dollars a student and tells them to digitize a very crucial collection, you can't expect that they're necessarily going to put in the right names or the right key searches.

How do we ensure that in this immense project of collective digitization of history that's going on, there is some way we can have an overarching narrative for us as a nation?

[Daniel J. Caron]

We have just started with associations of librarians and archivists across the country. They are national, provincial, and territorial associations. We met once on the topic of developing a common trusted digital repository and working together to get a better understanding of what's being digitized where, so as not to duplicate.

We're finding there is a lot going on everywhere in the country. For example, the University of Toronto has a project of 20,000 francophone books that we just found out about. We need to grab this information and develop a collective catalogue. That's what we will do, and that's what we're starting to do collectively.

There will be meetings in June in Calgary with the Canadian Library Association and the Association of Canadian Archivists. Those are the discussions we are entertaining currently through these associations and the various groups we have.

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

Thank you.

I'm going to make a transition to YouTube. We always have this discussion about YouTube. My kids never watch TV. The TV just sits there. The only time they watch TV is when they buy a DVD, and they buy a DVD because they saw something on YouTube that a friend posted and told them to check out. Then they posted it on Facebook.

YouTube is where they communicate. We can call them pirates or we can call them whatever you want, but there's so much information. I would challenge the image that it's amateurish. People post on YouTube because they love it. We see people posting all kinds of historic footage that they recorded on their own. There are amazing historic archives on there.

The transition is in terms of how we value this. It seems to me that there's one model being put out: we'll just make it illegal to break a digital lock, and then everything will go back to the market that used to be. I'm sorry, but that market's dead. It's never coming back. We have to find a way to attach a monetizing value to the content that the kids are loving and creating and posting. That, to me, should be the question of where we're going. It's not about how we stop people from using it, but about how we monetize it.

You've raised the issue of collective licensing. You've raised the issue of a levy. How do you see copyright realistically moving forward in the 21st century?