Good morning, Mr. Chair and honourable committee members. My name is Jonathan Daniels and I am the vice-president of regulatory law at BCE Inc. With me today virtually is my colleague Alain Strati, assistant general counsel, with whom I'll share my time in this opening statement.
As you may know, Bell operates a variety of broadcasting services across Canada—television, radio and online—in English, such as CTV, and in French, such as the recently launched Noovo network. We are also a distributor of Canadian programming through Fibe TV and satellite TV. We provide critical news and information services, ensuring Canadian voices are represented and heard. We also support Canadian talent with contributions to the Canada Media Fund, FACTOR and Musicaction, among others, and through our own Canadian production.
We support Bill C-10 and urge its swift passage into law. It is long overdue.
By now it should be clear that Canadian broadcasters are struggling. Foreign over-the-top providers are thriving in the Canadian market. Over the last four years, they grew their Canadian revenues by over $2.4 billion, while at the same time Canadian broadcasters experienced a drop in revenue of over $1.3 billion. Here's another jaw-dropping statistic. The three largest OTT service providers—Netflix, Amazon Prime and Disney+, the latter of which just launched a little over a year ago—already have more Canadian subscribers, between the three of them, than all of Canada's television distributors combined.
Local television and radio are taking the brunt of the impact from foreign competition. In 2019, 70% of our country's private local television stations and 40% of private radio stations had a negative profit. The pandemic has, without a doubt, aggravated the situation.
Despite all this, we continue to operate, but we do so in a regulatory environment that is outdated and that imposes massive obligations on Canadian licensees while completely exempting foreign OTT providers.
As a much-needed first step, Bill C-10 would correct the structural imbalance by ensuring that OTT providers financially support Canadian programming. OTT has been granted a free pass for over 10 years, and OTT providers have not contributed to Canadian content programming, while taking away subscription and advertising revenue dollars from Canadian broadcasters. In contrast, Bell Media and Bell TV spend close to $1 billion annually on Canadian programming, through either direct expenditures or contributions to funds like the CMF.
However, it is not enough to require OTT to fund Canadian content. As the impact of OTT providers continues to grow and broadcast revenues shrink, the ability of domestic broadcasters to support Canadian content has weakened considerably. We must reduce the regulatory burden on domestic players. This can be achieved at the same time as growing the total expenditures on Canadian content by making OTT providers contribute their fair share.
Alain.