Canadian Heritage Committee on Sept. 27th, 2016

[Michelle Hoar]

It's hard to make the kind of very specific recommendations that other witnesses here today can make, because they have so many existing types of support and whatnot, whereas we operate in a field where there isn't a lot of support, a lot of legislation, or a lot of precedent.

Certainly, I think there are a lot of things that could help. There has been a lot of talk about advertising tax breaks. I'm not even sure whether a media company like ours is eligible for the kinds of tax breaks that companies can get to advertise with other types of print or broadcast media. That is certainly of interest to me: looking at section 19 of the Income Tax Act and whether it applies to companies like ours.

Certainly, it's odd to me that Canadian companies can get a tax break for advertising with Facebook and Google. That really needs to be fixed. Organizations like that, which create no content, are creating a very uneven playing field for the rest of us, who do produce journalistic content, whether that's in print, broadcast—

[The Chair, Liberal, Hedy Fry]

Thank you, Ms. Hoar.

I am sorry, but I have to cut you short.

[Pierre Nantel, NDP, Longueuil—Saint-Hubert, QC]

Thank you very much.

[The Chair, Liberal, Hedy Fry]

We've gone to eight minutes on this one, and I've allowed you to answer the question. Thank you.

Perhaps somebody else might let you pick that up.

Mr. Vandal for the Liberals, please, for seven minutes.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

Thank you very much for your presentation.

I am going to direct my first set of questions to The Tyee.

First, I would like to know a bit more about the organization. You've said that you've been around for 13 years.

[Michelle Hoar]

Yes.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

You are an independent online magazine. Do you do any video production at all as part of your magazine?

[Michelle Hoar]

We did do a small amount. Most of our reporting is text-based, but we do some video.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

You also have a Tyee Solutions Society, which is a non-profit organization.

[Michelle Hoar]

Yes, that's a separate organization that we have a relationship with. It produces a longer forum series, a solutions journalism series, and The Tyee is a guaranteed publisher, but not an exclusive publisher. We've collaborated with CBC Radio and NBC. We've collaborated with the Walrus magazine and with the Waterloo region Record and a number of others.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

Are there different owners? I'm assuming that Tyee is privately owned.

[Michelle Hoar]

Yes, it's a limited partnership. We have two investors.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

The non-profit has a board of directors?

[Michelle Hoar]

Yes, that's right.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

Okay. Obviously there are some advantages, and you've made that work. I assume you're a fairly unique model in Canada.

[Michelle Hoar]

I would say we're fairly unique, yes. There are not a lot of players in this space yet. There are certainly more examples in the United States and through Europe of the kind of thing we do. Canada is a little bit behind, I would say, in this field.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

One thing we've heard over and over again as part of this study is that the Canadian government has stopped advertising in traditional media and are going to online and Internet advertising. I note that 20% of your budget comes from advertising. Do you get any Canadian government advertising in The Tyee?

[Michelle Hoar]

No.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

Do you get any government advertising at all?

[Michelle Hoar]

I can think of one provincial government ad that was placed in the last few years.

I can't point to the government and say that they have purposely not advertised with us, but I have been, for most of the 13 years, the entire business department of The Tyee, with one third of my time, maybe, available to sell advertising.

From Vancouver, as an independent, stand-alone, online-only entity, it's very hard to crack the nut of large institutional advertising. Usually you're having to get through an advertising agency that increasingly doesn't want to deal—

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

Sure.

[Michelle Hoar]

—with small independents. It's pretty difficult. I can't say that there's been an explicit intention not to advertise with us, but it's difficult.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

Just to give me some context, what is the annual operating budget of The Tyee versus Tyee the non-profit?

[Michelle Hoar]

The Tyee now has an operating budget of around $1 million. The Tyee Solutions Society operates project by project with contract staff, so its budget really fluctuates every year, depending on what projects it has raised money for.

[Dan Vandal, Liberal, Saint Boniface—Saint Vital, MB]

Much of what we've heard from the traditional media is that we need to look at tax credits for traditional media, and we need to look at government returning to advertise in traditional media.

We've heard comments questioning the quality and the accuracy of online media, yet you appear to be quite successful. I'm not sure about sustainable, but you appear to be quite successful. I'm interested in your comments on how we should approach solutions for traditional media versus your untraditional media success. I'm seeing a potential contradiction there, so I'm wondering if you could comment on that when we get to the recommendation stage.