Evidence of meeting #155 for Canadian Heritage in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was content.
A recording is available from Parliament.
Liberal
Anju Dhillon Liberal Dorval—Lachine—LaSalle, QC
The CRTC prefers the fourth approach in the conclusion of the recommendations. Can you please elaborate more in detail why that is the case?
Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission
Deregulation.... The current tools don't really work for all the new players. We need new tools. There are different types of players. They can contribute in different ways. Amazon and Netflix can contribute differently and must contribute differently from a traditional local CTV news station, which gives you news and information. That's why we need a new mechanism, so that new players are clearly part of our system and that we clearly have to tools to be able to ask them to contribute in the best way possible so that we further the objectives of the Broadcasting Act.
Liberal
The Chair Liberal Julie Dabrusin
We are going back to Mr. Shields for five minutes.
Oh, Mr. Yurdiga.
Conservative
David Yurdiga Conservative Fort McMurray—Cold Lake, AB
I'd like to thank the witnesses for being here today. It's a very interesting topic, the CRTC. It affects everyone to some degree.
Growing up, I remember there was the old rotary phone and the party line. That really ages me. I'm not as old as Martin, so that's a good thing.
Technology is changing so rapidly. I'm not sure if we're keeping up, as far as a regulatory body is concerned, the CRTC. There's always something new. What needs to be done? Are you guys keeping up with technology, or are you always behind the eight ball? I'd like to get your opinion on the current status and what needs to be done to be able to be relevant, being there when something changes.
Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission
Whether the CRTC is the right body or relevant is not something for all of you to answer. I think we'll talk more about the system. I think the system certainly remains relevant, providing news and information to Canadians so that they know what the positions are, know how to interact in democracy, know about important information in local markets, have access to emergency information on an effective means. Our system clearly remains relevant.
Telling the stories, Mr. Nantel gave examples of social issues that are then debated through our system that are really Canadian issues. Those issues will not be discussed in the same way on international-based platforms. We used to be concerned about the U.S. and its impact on Canada. The market has gone global, so it's a global environment. Stories by Netflix are being produced on a global platform and being distributed all over the world, so there's a great benefit. We're learning more about what's happening elsewhere and being exposed to new and different ideas, but the real risk is that actual Canadian ideas may not be on that global platform in the future.
Conservative
David Yurdiga Conservative Fort McMurray—Cold Lake, AB
As time goes by and if one compares the situation now with that 10 years ago, is the per cent of Canadian content and the number of hours a person watches going down, or is it steady? What would we need to do to ensure that we have more Canadian content?
Director, Television Programming, Canadian Radio-television and Telecommunications Commission
As far as viewing goes, the numbers seems to suggest that it is remaining relatively stable. The number of viewers of our traditional platforms, though, is in decline. One can certainly see that even if the people who remain are continuing to watch roughly the same amount of Canadian content, as the subscriber or viewer base declines, you're going to experience decreasing profitability for those services.
Conservative
David Yurdiga Conservative Fort McMurray—Cold Lake, AB
We've talked a little bit about demographics. I just want to know about the rural and urban split. Obviously, there is faster Internet.
Is there any difference between rural viewing habits of traditional cable or streaming services? Do you have any data on that, or even a comment in any way?
Director, Television Programming, Canadian Radio-television and Telecommunications Commission
The largest defining feature between rural and urban environments tends to be access to broadband Internet. When there is access to broadband Internet, you see a larger audience for online services. When there is a lower level of access or lower speeds available, you see a smaller number of people who are relying on the online services and they rely more consistently on the traditional services.
That's not consistent across the board. There are demographic splits, of course, and there are language market splits that show differences, but in general the biggest difference tends to be access to broadband.
Conservative
David Yurdiga Conservative Fort McMurray—Cold Lake, AB
I have a quick question, then. Forty seconds is not a long time.
Where do you foresee television going? Is it going to slowly phase out and everything will be streaming, or do you think the market share is going to stay relatively stable?
Director, Television Programming, Canadian Radio-television and Telecommunications Commission
We would say that it's unquestionable that there will remain a traditional type television service. It will adapt and change.
One of the reasons we described cable service as still being mature, rather than in decline, is that there are options ahead for them. There is a move to IP-based services. There are certain changes that are already in progress to cable services across the country that may make them more appealing to Canadians and maintain subscriber bases.
But they are certainly challenged, and there are difficulties ahead unless significant adaptations are made.
Liberal
The Chair Liberal Julie Dabrusin
That's the end of your time.
We are now going to Mr. Long for five minutes.
Liberal
Wayne Long Liberal Saint John—Rothesay, NB
Thank you to our presenters. It's very interesting.
Can you just provide me with a bit of context? I know that you talked about traditional television earlier. I think you said it reaches about 85% of Canadians, and Internet television reaches 60% to 65%?
Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission
Yes.
Liberal
Wayne Long Liberal Saint John—Rothesay, NB
Can you give us the context of what it was five years ago and 10 yeas ago? And where do you see it—
Director, Television Programming, Canadian Radio-television and Telecommunications Commission
I'll talk about cable numbers, or what we call BDUs.
Five years ago the cable penetration rate was closer to 85% in English-language markets. It's now about 71%. That's just cable penetration. Of course, you have over-the-air television layered on top of that.
But yes, that's a significant change in not too long a period of time.
Liberal
Wayne Long Liberal Saint John—Rothesay, NB
I, too, can remember when we went from two channels to four channels. We added ABC and NBC and our lives were never the same.
You published the report in May 2018. In your view, has the Canadian broadcasting landscape changed significantly since then?
If you were to publish a report today, would you make any changes or suggest any other different policy options from those you outlined in the report? Are things changing so quickly that you're trying to catch up to this, or what would—
Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission
I think the trends are pretty much in line with what we had evaluated about a year ago, and they certainly are, as we've explained in the report, consistently downward trends in consumption. As Sheehan has indicated, I don't think we're anywhere near a cliff, per se.
There may be additional changes coming forward. That's one of the reasons why, as we've suggested in our report, we need to look forward. We need to adapt our system, but keep it flexible because of that very reality that there is constant change and ever-evolving digital platforms.
Liberal
Wayne Long Liberal Saint John—Rothesay, NB
You don't see a point where traditional television will drop right off the map. Do you see it levelling out at some point? Where do you see it in, say, 20 years?
Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission
I don't think we would venture to look 20 years ahead.
Executive Director, Broadcasting, Canadian Radio-television and Telecommunications Commission
We would venture to look five years ahead. I think we'll still have a system for the next five years, but beyond that I would certainly question what the system would look like.
Liberal
Wayne Long Liberal Saint John—Rothesay, NB
Okay.
The report also looks at the viability of business models in the audio and video markets. In looking at the models in decline and those that are becoming more successful, are there potential new markets and business models that you foresee taking the place of other models? Do you see any other options, opportunities, maybe, Mr. Carter?