Canadian Heritage Committee on March 22nd, 2021

[Alain Rayes, Conservative, Richmond—Arthabaska, QC]

Thank you, Mr. Chair.

I thank all the witnesses for joining us today to help our committee.

My first question is for Mr. Bernhard, from Friends of Canadian Broadcasting.

When the minister appeared before us, in answer to one of my questions, he implied that social media were included in the bill. However, I listened to your remarks today, and when I look at subclause 4(1) the bill is supposed to add to the act, I see that it would not apply to users generating and receiving programs through an online company that provides a social media service. Companies such as YouTube, Facebook and TikTok are some examples of [Technical difficulty—Editor] that enable users to upload content.

Do you have comments or information you would like to add to explain your opinion on this part of Bill C-10 that would lead to the Broadcasting Act not applying to social media services?

[Daniel Bernhard]

That is a very important provision of the act. According to Friends of Canadian Broadcasting, it is important to distinguish between users who share content with one another and the platforms themselves, which generate billions of dollars through those distribution services. So it is a matter of magnitude.

We feel that clear guidelines must be created to exempt small broadcasters, be they users of YouTube, Facebook or professional services, and guarantee that the largest broadcasters would not be exempted and would have to contribute.

So a very clear regulatory structure must be created. As I just said, the minister made a misleading statement. Those social media services are broadcasters under the legislation. That is why an exemption is necessary. So I disagree with the minister saying that YouTube and Facebook are not exempted.

[Alain Rayes, Conservative, Richmond—Arthabaska, QC]

The two of us agree on that.

If Bill C-10 was passed, it would require online businesses, be they foreign or Canadian, to contribute funding to the Canadian broadcasting system so as to support creators and producers of Canadian content.

Conversely, do you think foreign online broadcasting companies should have the right to request funding from federal cultural institutions and from the Canada Media Fund to create Canadian content?

[Daniel Bernhard]

This is another important question. I think the objective must be to create a fair system where competition is fair—in other words, a system where Netflix and Canadian broadcasters, its competitors, are required to contribute based on a similar percentage.

If Netflix can also access cultural funds like the Canada media fund, for example, that's not a major problem in my opinion, but clear rules must be established so that all broadcasters, be they foreign or Canadian, would contribute equally and be subject to the same rules.

[Alain Rayes, Conservative, Richmond—Arthabaska, QC]

That's great.

I have another question for you, and it is also for Ms. St-Onge, from the Fédération nationale des communications et de la culture.

Do you have any specific concerns regarding the powers given to the CRTC, in light of the way the organization has behaved in the past regarding certain files?

Mr. Bernhard, you can answer first, followed by Ms. St-Onge, please.

[Daniel Bernhard]

The situation is unclear, and that worries me.

The bill, through ministerial instructions, gives many options to the CRTC, which could regulate broadcasters in the circumstances it deems appropriate, which are not clearly defined.

We believe it is important to create clear guidelines on income generated in Canada, on users and on the funding of global original content, among others, such that the Parliament of Canada would take business size into account. When a business surpasses a certain size, it must be required to contribute to Canadian content, without exception. It is very important to clarify the situation.

It seems that no one wants to clearly say that companies must pay and contribute to Canadian content. The government wants the CRTC to make a decision, and the CRTC wants the government to make a decision. In the end, no one is making a decision.

So it must be specified, in the legislation and not in a statement from the minister's office, that those contributions [technical difficulties] and more certain for the industry, as well.

[Alain Rayes, Conservative, Richmond—Arthabaska, QC]

Thank you, Mr. Bernhard.

I would like to give Ms. St-Onge an opportunity to comment.

We have been told that this would be included in the order and not in the legislation. We have received the order, but we are not really seeing relevant information in it.

Ms. St-Onge, do you have any comments on that?

[Pascale St-Onge]

This is something we are concerned about because, in the past, the CRTC had the power of life or death over companies through its decision on whether or not to issue a licence, while now, a power to impose fines is being mentioned.

We are concerned about the CRTC's ability to fulfill that mandate, especially when it comes to resources, but also about the way it will do that new job.

We would have liked the order to require the CRTC to publish a roadmap very quickly to tell us how it will behave and how it will apply the legislation passed. So far, we have not heard anything on this.

[Alain Rayes, Conservative, Richmond—Arthabaska, QC]

Thank you very much, Ms. St-Onge.

[The Chair, Liberal, Scott Simms]

Thank you very much.

Ms. Ien, you have six minutes, please.

[Marci Ien, Liberal, Toronto Centre, ON]

Mr. Chair, thank you so much.

Thank you to our witnesses for being here today.

I want to start with ACTRA. Mr. Sparrow, you indicated you are a performer. Can you tell us what you do?

[David Sparrow]

I've had an extremely fortunate career over the last 30 years. I've been in over 100 film and television roles, commercials, voice-overs, cartoons and all kinds of things. I have also been a writer and had a couple of projects made, so I have made my career in the arts for 30 years.

[Marci Ien, Liberal, Toronto Centre, ON]

I want to tap into that insight just a little. Could you provide us some insight into your world right now and what things might look like if the changes you propose aren't implemented?

[David Sparrow]

I think it's obviously a world that impacts performers. Performers are in some respects the most precarious workers in the industry, in that we aren't guaranteed the work we do. In essence, we apply for jobs every single day by auditioning. Sometimes we get those jobs and sometimes we don't.

It's important to note that a typical performer's income in Canada, even an ACTRA member, a union member, is approximately $11,000 a year. Yet many of our performers obviously make significantly more than that, and some less than that. It's a challenging career.

This is not just a performer problem; it's an industry problem. As we look at the changes that are being suggested within the legislation and within the comments that are being sent to the CRTC.... We risk the shift in what is Canadian content and what flexibilities will be given in terms of that, and therefore what kinds of jobs, etc. will exist into the future.

I think Mr. Bernhard stated it quite eloquently that this committee, this current government has a great opportunity to set the stage for the next 20 or 30 years of Canadian broadcasting and also of how we're going to provide a cultural legacy for the generations to come.

[Marci Ien, Liberal, Toronto Centre, ON]

Thank you so much, Mr. Sparrow.

I want to go to Bell now. Mr. Daniels, you talked about news and the fact that this bill doesn't provide financial support for local news. You were talking about Canadian content.

How do you define that? How do you define Canadian stories?

[Jonathan Daniels]

I think I'm going to hand it off in a second to my colleague, Mr. Strati, to discuss that.

In terms of defining, I think there's a very important difference between news, which is what we're talking about, as opposed to Canadian productions and CanCon, because there are strict rules on how CanCon is produced. The foreign providers, the OTT providers, may be investing in Canada, but they are not producing CanCon. They are not making any productions that meet the criteria of the CRTC or the CMF. Like many of the colleagues I heard speak today, I think if we're going to have something to go forward, we have to ensure that's the case for those providers.

In terms of defining Canadian content and so on, there are rules set out about that. I note that there may be some tweaks to the direction that the CRTC would have to consider. We will look at participating with the CRTC in that regard.

If you're talking about defining news, that's something that is already done by the CRTC. There are funds. Maybe Mr. Strati could elaborate on that aspect, because that's something very easy to define and has been the case already.

[Marci Ien, Liberal, Toronto Centre, ON]

Go ahead, Mr. Strati, and then I'll get back to that.

[Alain Strati]

Go ahead.

[Marci Ien, Liberal, Toronto Centre, ON]

I was just focusing in on the CanCon first, because I will note that Bell has laid off hundreds of people who are responsible for Canadian content in this country—and full disclosure, I was an employee for years. This is something that is concerning, if we're concerned about Canadian content and Canadian content producers and jobs are being lost. I'm just trying to balance the two.

[Jonathan Daniels]

Listen. I think that's.... We're all concerned. I think what we're seeing here in the broadcast industry is that the traditional domestic broadcasters are seeing declines in advertising and so on. We have had to make difficult decisions that are necessary to adapt to the transforming media industry but, at the same time, I think this bill enables more money to come into the system generally.

There's a lot more money—I think the minister talked about $830 million, and we have similar predictions by 2023—that can come into the system to promote Canadian content, as long as we have rules around making Canadian content so it can grow in terms of the amount of production that's done. At the same time, we need to be levelling the playing field. We need to make sure that the existing Canadian domestic broadcasters that are seeing a decline in revenues and seeing a competitive threat are able to have more streamlined rules and compete on a level playing field with the OTT providers. We see this bill as achieving that.

[Marci Ien, Liberal, Toronto Centre, ON]

Thanks so much, Mr. Daniels.

Mr. Strati, did you want to comment?

[Alain Strati]

I would just add that COVID-19 in the last year heightened the concerns we have in terms of the sustainability model, especially for local news. Viewership has gone up 15% to 20% and revenue has gone down. It's really a framework and a need for a financial model, which is failing. A change in that framework, and specifically directing the CRTC, I think will give better sustainability. The interest is there; it's just that the model itself, based on advertising, is difficult.

[The Chair, Liberal, Scott Simms]

Thank you very much.

Mr. Champoux, you have the floor for six minutes.

[Martin Champoux, Bloc, Drummond, QC]

Thank you, Mr. Chair.

My first question is for Ms. St-Onge.

Ms. St-Onge, it's very nice to have you with us again.

We've spoken pretty regularly about the concerns you, your organization and your members have regarding the health and survival of the francophone cultural industry, specifically, Quebec's cultural industry. As we know, the act provides little in the way of support. You no doubt saw the draft directive the minister released a few days ago.

I am curious whether you drew any satisfaction or reassurance from the draft directive regarding the way forward, if the bill is passed and the government issues directives to the CRTC as the bill prescribes.

[Pascale St-Onge]

To begin with, the directive mentions French, whereas the act refers to both official languages. In that sense, the policy direction order is a step forward.

However, we feel there could have been more emphasis on funding for French-language productions to ensure they received a significant share of the funding. When you compare the hourly rates allocated for French-language productions and English-language productions, it's clear that French-language productions have been underfunded for many decades. That needs to be rectified. In our view, the order is more meaningful than the act, but that is not to say the act shouldn't be amended to highlight the importance of producing original French-language content.