Canadian Heritage Committee on Nov. 18th, 2010

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

As members of the Bloc Québécois, we are always very pleased to have a chance to defend the interests of Quebeckers and people in the regions experiencing television reception problems. We can discuss them at another time.

So, we jumped the gun by inviting you to come today. You don't have answers to the questions we may want to ask. I can't even ask you whether, in your opinion, vertical integration in Quebec has benefited broadcasters and consumers. But it was a good question.

[Scott Hutton, Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission]

We have seen a number of developments in Quebec. The market is a little different from the English-language market, although--

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

I'd like to hear you say “very” different.

[Scott Hutton]

It may be very different, or it may be only somewhat different. The English-language market monitors what is occurring in Quebec. The largest integrated company is Quebecor. I guess you could say that other distributors are falling into step to a certain extent and doing business in Quebec. There are benefits. For example, the company itself is doing very well. Also there is a star system in place that has been very successful under its direction. There are new services--

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

The Quebec star system is a success—not only Quebecor's system. I really like Quebecor, but still--

[Scott Hutton]

Yes, but that company has created its own star system, I believe, through vertical integration. This is a company that is very successful and has been pushing its stars, for its own benefit. Is this affecting others—in other words, people who are not part of that big team? That is the question. That may be the negative side of it.

[The Chair, Conservative, Michael Chong]

Thank you, Mr. Hutton and Ms. Lavallée.

Mr. Angus, please.

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

Thank you for coming today. It's always a pleasure to have the CRTC before our committee.

As I listened to your talk this afternoon, I must admit that I was starting to get very nostalgic for the 20th century. I had a great time in the 20th century. There were a lot of great shows, there was a lot of great music, and my hair was a little darker then.

[Voices]

Oh, oh!

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

And in the 20th century, we did worry about two television stations and one market being controlled, so we needed to have a third one. We were worried that we couldn't have three radio stations being controlled. We were worried about the future of AM radio.

Here we are in 2010 and we have had this massive tectonic shift. My kids don't care how many stations there are in the Toronto market, because they have their phones. I think the question we need to talk about today is that under your watch we have seen vertical integration and consolidation to the point that the people who run the phone companies are now running the broadcasts. So what are you going to do about it?

Because I'm not really worried about the situation with AM radio. I'm worried about ensuring diversity of voice when two or three players control the entire market.

[Konrad W. von Finckenstein]

You proceed from the assumption that there's a problem and we have to worry about it. As you yourself said, we've seen a tectonic shift, to use your words, and you have a huge number of sources of information right now, something we hadn't... Yes, we have a great concentration of ownership, but does that reflect itself in a homogeneity of voices? That's a big question.

As you well know, your kids, as you say, much prefer their iPhones, and their iPhones may be from Rogers or Bell or one of the three big companies, but the content they get, the access over that iPhone, comes from all over the world, from all over Canada, etc.

So yes, the means of access are owned by three companies or four, however many you want to consider, but it doesn't necessarily mean the content is the same and that you therefore have problems and not a diversity of voices.

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

This is the fundamental question. You say I assume there's a problem. You tell us your prime directive is to assume there's not a problem and--

[Konrad W. von Finckenstein]

I didn't say--

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

--that the CRTC's “prime directive”, as we said in the old Star Trek days, because I'm going back to the 20th century here, is to interfere in the market as little as possible. You say that again and again, and then you say that of course you want to ensure diversity of voice. I would have assumed that the main role of the CRTC--why we have it--is to ensure the public interest is defended. It's not the job of industry to represent the public interest. It's not the job of industry to do the diversity of voice.

We're in a situation here where Bell can offer their phone viewers exclusive highlights of the Grey Cup if they sign on at $3.99 a month or $5.99 a month. That would make perfect sense from a business model. A small start-up company that's competing with Bell would like to get access to content. As you say, certainly content comes from all over the world, but we're interested in content that's coming from Canada, that's being created now by this exclusive group.

What steps are in place? Or have you even addressed the fact that the guys who are selling me my phone package every month are the same guys who are controlling the content? And they might not want that content going to their competitors, because hey, you're going to get a better deal in their little walled garden. That's the issue we need to look at.

[Konrad W. von Finckenstein]

Let's start with.... You made a huge number of assumptions here, most of them which I would disagree--

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

A huge number of questions.

[Konrad W. von Finckenstein]

Okay, fine. Call them questions, call them assumptions.... You said, for instance, that you have to protect the public interest. That's absolutely right, but the public interest is not only diversity of voices. We also want to make sure we have a thriving industry that employs people and is productive and innovative.

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

But that's not in your mandate. That's what you've decided. I don't see your job as protecting the industry, as the role of the CRTC.

[Konrad W. von Finckenstein]

Oh, absolutely, it's in my mandate. Read the objectives of the Broadcasting Act. It--

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

To allow industry to succeed?

[Konrad W. von Finckenstein]

No. It presupposes that you make sure you have a healthy broadcasting communications industry. You don't have that if you're over-regimented and throw regulatory roadblocks in the way.

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

But we're at the point now--

[Konrad W. von Finckenstein]

So our job is--

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

--where you have two guys running the market.

[Konrad W. von Finckenstein]

You have to let me finish. You asked the question. Let me finish the answer.