Canadian Heritage Committee on May 6th, 2015

[Louis Dussault]

I will summarize as best I can.

We have put forward proposals to improve the situation of independent film distributors in Quebec, who account for the majority of all distributors. They provide production funds for independent films, which constitute the majority of films produced in Quebec, even though they do not receive most of the funding.

We suggest that capitalization envelopes be introduced to help distributors participate in project development. That should have been one of the conditions for allowing the merger of Christal Films, Séville and Alliance. That merger has created a huge monopoly that is currently channelling 90% of the funding for production and distribution. No conditions were imposed on the merger. Normally, the development of capitalization assistance envelopes for companies left behind should be allowed, as those make up the majority of companies developing independent films in Quebec.

We also want financial assistance for developing a content aggregator. Details on what a content aggregator is are in the document. We also want VOD and SVOD platforms to be regulated so as to ensure they are investing in Canadian productions, which is not currently the case, and even less so when it comes to Netflix.

We also want a subsidized network of cinemas dedicated to art and experimental films to be created to provide the Quebec public in all regions of the province access to its national films. I could add that this idea is even more applicable to English Canada, since there are no independent theatres beyond the chains, such as Cineplex.

Those are all the comments we have prepared. You will find more details on them in our brief.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

We have learned a lot, and I want to thank all the witnesses for that.

I first want to say that there are two organizations in Canada that are ambitious, creative and whose initialism is NDP!

My first question is about something we have heard several times—the fact that everything has changed.

Virginia, you made it very powerful when you said that everything has changed. That means the rules are different.

Mr. Noble, we heard that there's not so much adherence to Canadian regulatory authorities. It's easy to raise that as a lament, as opposed to asking what we can do about it.

Ms. Thompson, you gave us several suggestions. You ran through them very quickly.

[Virginia Thompson]

Yes, I did.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

You said to bolster Telefilm in this digital age, make sure that established producers from TV have an edge.... I didn't really—

[Virginia Thompson]

No, I raced through that. I can probably be a little more thoughtful now.

I think everything has changed. I think that what is exciting about the new world is the capacity for storytellers to reach a global audience at home. But at the same time, what's happening is that our funding is drying up to a large degree. It's getting very tight in Canada, and I think it's an unfortunate situation, because Corner Gas: The Movie really illustrates that if you can have a digital marketing plan that allows you to reach the audience through social media, you can double your audience. So this is actually a golden age, should there be the funds in the system to support reaching the world.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Okay, there's the key. How did you get money from all of those viewers from around the world—

[Virginia Thompson]

I didn't get money, but I reached them.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Okay, so having reached them.... What's the financial model there? That's the part that I think—

[Virginia Thompson]

Well, I think what's interesting is that we judge feature films to a large degree on their box office success, and it's a long tale. A film doesn't just exist for three months in the theatre. It goes to VOD, and then it goes to pay TV, then it goes to TV, and then it's on DVD, and then it might be picked up by Netflix. It can have a very long life.

When one releases a film, that's the only chance you have to reach an audience. You have a great opportunity, but there really aren't marketing dollars, number one, that producers can access in order to get that funding. I was able to do it because I negotiated a deal with a television broadcaster, and that deal then allowed me to access television funding for digital media engagement. But a typical feature filmmaker doesn't have that opportunity.

[The Chair, Conservative, Gord Brown]

Thank you, Mr. Weston.

[Virginia Thompson]

Is that clear?

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

It somehow doesn't answer the question: what is the business model that we can learn from that experience?

[The Chair, Conservative, Gord Brown]

Mr. Nantel, you have seven minutes.

[Pierre Nantel, NDP, Longueuil—Pierre-Boucher, QC]

Thank you, Mr. Chair.

Thank you, Mr. Weston, for letting the witnesses finish up. That's very appropriate. I hope that we will have an opportunity to come back to your question. As for me, I have some burning questions, specifically about the Quebec film industry, which is so prolific and of which I believe all Canadians are very proud.

Ms. Prégent and Mr. Charron, I feel that two major issues arose from your testimony, including translation. As you pointed out earlier, that is a major aspect. You also talked about the visibility of content produced in Quebec and alluded to the changes made by the CRTC.

We have here an example of a union of workers, actors and performers that decided to take a wage cut of 15% to 20%—which, in this case, is as exceptional as it is pragmatic—to be able to face the international competition.

Do you feel that governments understand the magnitude of your effort?

The infrastructure is often very heavy, very difficult to move. It's dangerous when that becomes frequent. The members of the committee often wonder whether there is a way to be more proactive, more lively in the face of technological changes. When we were elected in 2011, no one had an iPad, but everyone has one today.

Do you feel that governments are reacting fairly quickly to technological changes?

For example, advertisements seem different to me. I am noticing more and more of a slide in television ads, for instance. I'm hearing people I do not recognize, who speak with a funny accent, and I am wondering whether Quebeckers did the translation into French.

[Sophie Prégent]

It should be pointed out that the dubbing of a film and that of an advertisement are two different things. They are covered by totally different collective agreements.

At the Union des artistes, we have 54 collective agreements. In the case you are telling me about, the Association québécoise des productions médiatiques, AQPM, is probably involved. It could also be the APC.

We are currently concluding an agreement on new media advertisements. However, it has not yet been signed. That is probably why you are hearing all sorts of voice-overs, and not necessarily the best ones. In fact, those professionals are not members of the Union des artistes, since the agreement has not yet been concluded. But it shouldn't be too long now. I think we will sign it this fall.

[Pierre Nantel, NDP, Longueuil—Pierre-Boucher, QC]

Oh, I see.

[Sophie Prégent]

That said, it is definitely a market that influences the other one.

[Pierre Nantel, NDP, Longueuil—Pierre-Boucher, QC]

In a negative sense.

[Sophie Prégent]

Clearly, and that is why it is very difficult for the Union des artistes to keep the bar high and negotiate extensively. I am hearing that there is no money to be made in new media, while the income of actors who do advertisements on television is still decent. But they are not in the Internet and new media industry.

[Pierre Nantel, NDP, Longueuil—Pierre-Boucher, QC]

That's clear.

[Sophie Prégent]

So those are two completely different things.

[Pierre Nantel, NDP, Longueuil—Pierre-Boucher, QC]

The Minister of Canadian Heritage said that her department was not getting involved with Netflix, that it let that company do whatever it wanted.

Isn't that encouraging the company's departure, even though it had begun the translation of its program's third season? It was on the second episode, and the company decided to move to France.

[Sophie Prégent]

You are probably talking about House of Cards.

[Pierre Nantel, NDP, Longueuil—Pierre-Boucher, QC]

Yes, exactly.

[Sophie Prégent]

As we specified in our brief, Netflix will no longer do dubbing in Quebec, and I'm not only talking about House of Cards. In fact, that is why the union sat down with the major producers, including Technicolor, which accounts for 50% of the market. They clearly told us that we had to reduce our rates. But that is very difficult. We were satisfied, but we were no longer competitive, and we had to evolve. I believe that Quebec dubbers have had to have the courage to say that, to preserve their local market and avoid being taken over by Barcelona, Madrid or Israel—that is what the current situation looks like—they had to take action. And they did so without bending over backwards. I find them to be extremely brave.

We are now talking about very different markets. In the DVD market, for instance, we have reached almost 25%. In the markets that are still doing very well, such as theatrical releases, the drop is less significant. That at least gives dubbing producers some breathing room.