Evidence of meeting #31 for Canadian Heritage in the 40th Parliament, 3rd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was content.
A recording is available from Parliament.
November 23rd, 2010 / 5:05 p.m.
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
It may have a good reason but the government could very well improve the Broadcasting Act and the Telecommunications to ensure that the service providers benefiting from using the Canadian service also invest in Canadian content.
Suzanne D'Amours Consultant, Association des producteurs de films et de télévision du Québec
Let us not forget also that the CRTC does not regulate the new media, that is to say the new broadcasting media, which are recognized as broadcasting but through the Internet.
Bloc
Consultant, Association des producteurs de films et de télévision du Québec
Take a broadcasting service, video-on-demand, VOD, which may broadcast television shows on the Internet, for example. This is clearly a broadcasting activity that could be regulated by the CRTC but the CRTC has decided not to do so in order to let those services explore this new market. At this time, we can see that this market is quite open.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Do you believe that merging the Telecommunications Act and the Broadcasting Act would be a first solution?
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
I must admit, Mrs. Lavallée, that we have not specifically looked at that issue. It would probably have many impacts and there might be some reservations.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
If I have nothing to do one weekend, I might send you the two pieces of legislation for you to have a look at.
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
Yes, I could do so, but we have not yet examined the issue from that very specific point of view in order to assess its advantages and disadvantages.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
However, you would still want the BDUs, VOD, mobile phones and the web to be regulated.
Are there any countries where those technologies regulated? If so, what does that regulation look like in order to achieve the objectives that you want to achieve today?
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
The first country to do so with probably be France, which has already started. We do not claim that Canada is behind the rest of the world. However, we can see some trends at the international level. There is an increasing tendency to regulate the new technologies, the distribution of national progress based on those technologies. And there is also a desire to ensure that everyone contributes reasonably to the production of content.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
I will give you an example of what France has done, from what I have heard. For example, Mr. Sarkozy himself as announced — which is quite surprising, as a matter of fact — that Google would now be taxed on the advertising income it collects in France. This would generate some revenues since the French government decided that he did not make sense for Google to come in France to collect advertising income and then leave with that loot to the US. That is only an example and I admit that there does not seem to be any content regulation there.
If we were to regulate, if the CRTC or another body were to establish a framework for what is being done in the fields of mobile phones, VOD or BDUs, what would be your objectives? In what direction would you want them to go?
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
The example you gave only has a short term effect, which we would also like to have. The point would be to make sure that Google base taxes on the income it collects from the French market, giving at least the French government the possibility to reinvest all or part of those amounts in the production of French content.
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
It is a solution.
Here, we would want all the industry players to contribute to that funding.
There is another important aspect that Mr. Bolen expressed very well a while ago . In Canada, we also have to find terms of agreements with the broadcasters. This would ensure that, taking account of integration, when you went to negotiate with the company owning cablevision, the Internet, traditional television and specialty channels, it would give you the same value for your license as what it gave you four years ago.
By purchasing all the platforms, the independent producer cannot succeed. The owners of the rights do not make any money. They do not want to pay for content. If they do not contribute to content, why should they keep all of the future uses and collect all the profits?
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
Yes, the BDUs.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
The broadcasters are sitting next to you. Go ahead, negotiate!
Conservative
The Chair Conservative Michael Chong
Thank you.
I believe that Mr. Maavara would like to add something.
President and Chief Executive Officer, Association des producteurs de films et de télévision du Québec
I started in 1972, so I'm either older or I started younger. I'm not sure which.
Executive Vice-President and General Counsel, Corporate, Corus Entertainment Inc.
Actually, we worked together on the Olympics many moons ago. We won't say when that was.
The question about taxation was a good one. I believe Google probably does pay tax on its income in Canada, but one of the recommendations we've made to the government is that section 19.1 of the Income Tax Act be applied to digital media. That would result in making the advertising expensive on foreign sites, in the same way as that works for Canadian television. We believe that would be a great incentive.
NDP
Charlie Angus NDP Timmins—James Bay, ON
Thank you very much.
This has been a fascinating discussion.
Mr. Maavara, I'm always interested in knowing what Corus is up to. It's a very interesting company.
I am interested in the issue about section 19.1, because that is one of the supportive tools that we put in place to support a market or protect a market. You're saying to move it onto new media platforms. For example, would that be if YouTube.ca is showing Canadian products, or are you talking about specific media?
Executive Vice-President and General Counsel, Corporate, Corus Entertainment Inc.
Basically, any commerce they're operating in Canada would be subject to that, so anybody who was advertising on those sites would not be able to take it as a business deduction, which effectively makes it more expensive. It has really worked in the television sector. I think the last estimate was that it was worth about $60 million or something, and there's no public money involved, as it were.
The difficulty—and we recognize that it's a difficulty—is defining what is digital media. That is a really tough question, but I know there are people who are working on that. If we can come to that definition, we think this is a terrific way to help recapture some of that value.
NDP
Charlie Angus NDP Timmins—James Bay, ON
It's an excellent suggestion.
Madam Samson, it's great to have you here again. You're a passionate defender of the creative class in our country.
I was interested the other day when we spoke with Mr. von Finckenstein. He said the jury was out, that it was too early to tell what the implications of massive media concentration were, which happened with these buyouts.
You've been sort of ahead of the curve with us in the Quebec context, with Quebecor and its large, vertically integrated empire and very little other options. What's been the experience for you in the independent production company in the Quebec experience?