Canadian Heritage Committee on June 1st, 2022

[The Chair, Liberal, Hedy Fry]

I call this meeting to order.

Good afternoon, everyone. Welcome to meeting number 29 of the House of Commons Standing Committee on Canadian Heritage.

I want to acknowledge that this meeting is taking place on the unceded traditional territory of the Algonquin Anishinabe nation.

Because of the order of reference of Thursday, May 12, this committee is meeting on the study of Bill C-11, an act to amend the Broadcasting Act and to make related and consequential amendments to other acts.

Today's meeting is taking place in a hybrid format, pursuant to the House order of November 25, 2021. Members are attending in the room and remotely using Zoom.

As per the directive of the Board of Internal Economy on March 10, those who are in the room should wear a mask. I actually encourage people to wear a mask to speak, because that's when particles are spewed, so to speak.

I'd like to make a few comments for the benefit of the witnesses and members. Please wait so that I can recognize you before you speak. If you look at the bottom of your screen, for those who are virtual, you will see that there's a microphone icon. Please click on that to unmute yourself, and click on it to mute again when you're not speaking. There's a globe at the bottom of your screen, which is used for interpretation. You may go to English or French, or whatever suits you. For those in the room, you know you can use the earpiece and select the desired channel.

I also want to recognize that no photographs should be taken of this meeting. Finally, if you want to speak, you should speak through the chair.

Thanks very much. I want to welcome our patient witnesses. All I can say is that you have patience.

I would like to welcome, as an individual, J.J. McCullough. Also we have the Association québécoise de la production médiatique, Hélène Messier, president and chief executive officer. We have BCE Inc., with Jonathan Daniels, vice-president, and Karine Moses, vice-chair Québec and senior vice-president, content development and news. From Black Screen Office, we have Joan Jenkinson, executive director. From the Canadian Media Producers Association, we have Reynolds Mastin, president and chief executive officer, and Catherine Winder, chief executive officer, Wind Sun Sky Entertainment Inc. Then, we have Friends, with Marla Boltman, executive director; and finally the Public Interest Advocacy Centre, with John Lawford, executive director and general counsel.

Each group will have five minutes. You can divide who speaks in that five minutes amongst yourselves, but you have five minutes. I will give you a 30-second notice so that you know that you should wrap up. When everyone is finished, we will then move to a question-and-answer segment.

I will now begin with J.J. McCullough.

[J.J. McCullough, As an Individual]

Hello, friends. My name is J.J. McCullough and I am a professional YouTuber from New Westminster, B.C.

Today I hope to teach the committee about Canada's vast YouTuber community and why so many of us fear Bill C-11, a bill we did not ask for and do not need, and one that threatens the success we've already achieved.

My channel subject matter is mostly cultural analysis with a focus on Canadian identity. My video topics have ranged from a biography of Wilfred Laurier to the history of potato chips to why different political parties use different colours. My most popular video, which is about a Dairy Queen in my community, has been reviewed over eight million times.

Professional YouTubers like me earn a living from in-video advertisements, with ad revenue generally correlating with the popularity of our videos. A YouTuber subscriber's count can offer a very rough estimate of its channel's potential audience size. My channel recently passed 750,000 subscribers. In total my videos have been viewed 230 million times. Now, these numbers might sound impressive, but I am actually one of this country's mid-level YouTubers at best.

According to socialblade.com, I am merely the 414th-most popular Canadian YouTuber. Indeed, according to Social Blade there are over 100 Canadian YouTubers with over 3.5 million subscribers and over a billion video views. However, popularity at this level isn't necessary for success. My friend Joe Lee is a professional Canadian YouTuber who makes videos about life in Vancouver and who was recently able to parlay the popularity of his channel into his own clothing line. He has just 156,000 subscribers and 12 million views, making him the 945th-most popular Canadian YouTuber.

This should hopefully offer a sense of the size of the YouTuber community as a faction of the Canadian cultural economy. The tremendous success and even worldwide fame of many Canadian YouTubers in the absence of government regulation should invite questions about the necessity of Bill C-11. An unregulated YouTube has been a 17-year experiment, and the result has been an explosion of popular Canadian content produced by Canadians of every imaginable demographic.

Now, much of the debate around Bill C-11 has centred on so-called user-generated content, which is often meant as frivolous social media posts, but proposed section 4.2 states that the government is interested in regulating content that “generates revenues”, which describes the sorts of videos professional YouTubers create. Regardless, it is important to understand that it is simply impossible to regulate a platform like YouTube without also regulating creator content. It's like promising not to regulate books while regulating what can be sold in bookstores. Hence subclause 3(7) of this bill states that online platforms must “clearly promote and recommend Canadian programming”, but what is Canadian programming?

We know from the precedent of television that merely having a work produced by a Canadian is not good enough for the CRTC. The nationality of basically everyone involved from editors to musicians to visual effects artists must be factored in too. A detailed budget is expected, and the project's theme and subject matter must be explained. The CRTC website features countless forms TV producers must fill out in order to get their work certified as officially Canadian and thus worthy of promotion on Canada's heavily regulated airwaves.

Most Canadian YouTubers shudder at the thought that this could soon be our fate as well. Given the broad powers of the CRTC, which Bill C-11 expands to include digital platforms, the Canadian YouTuber community is right to worry that the continued success of their channels could soon be dependent on their ability to make content that's Canadian enough to obtain government endorsement.

Even more ominously, proposed section 9.1 of this bill says the CRTC can dictate “the proportion of programs to be broadcast that shall be devoted to specific genres” on digital platforms. Given that YouTubers make videos of every genre imaginable, from fitness to architecture to political commentary, it is frankly terrifying to imagine that government may soon have a hand in determining which genres of video are more worthy of promotion than others.

In summary, anyone proud of the tremendous success of Canadians on YouTube should be deeply concerned about the damage that Bill C-11 could do to their livelihoods.

I also worry that the dreams of the next generation of Canadian YouTubers will become less achievable once they're forced to navigate intimidating new regulatory hurdles my generation did not. Most of all, I fear the damage that will be done to Canada's legacy as a global leader of cultural entrepreneurship once our online creators are forced to make narrowly nationalistic content under duress in order to win the favour of a government in denial of what we've accomplished on our own.

Thank you.

[The Chair, Liberal, Hedy Fry]

Thank you.

Now I go to Ms. Messier for five minutes.

Go ahead, please.

[Hélène Messier, President and Chief Executive Officer, Association québécoise de la production médiatique]

Thank you, Madam Chair.

Thank you for having me today.

I am Hélène Messier, president and chief executive officer of the Association québécoise de la production médiatique, AQPM.

The AQPM advises, represents and supports more than 160 independent Quebec film, television and web production companies. Members of the AQPM also produce content for online platforms, such as documentaries or web series. Therefore, many of them are also creators of original digital content.

On February 1, 2021, I appeared before the Standing Committee on Canadian Heritage to talk about the importance and urgency of passing Bill C‑10. One year later, I am reiterating the same message concerning Bill C‑11.

How do things stand one year later? Canadian domestic production and Quebec production are both declining. Less and less Canadian content is being produced in Canada. In fact, 58% of spending in the Canadian audiovisual sector now comes from companies that are headquartered outside Canada.

Independent production companies now account for 31% of the production volume—that figure was 35% last year—and broadcaster in‑house productions, which are essentially news, public affairs or sports programs, account for 11%.

Some will say it's great that Canada is a land of welcome for foreign businesses, but that leads to a loss of intellectual property for Canadian businesses and job losses for Canadian creators and actors.

Giving up our ability to create, produce, showcase and broadcast our cultural content to benefit foreign interests is like accepting foreign companies exploiting 58% of our agricultural land, according to their own standards, and controlling the marketing of grains, fruits and vegetables, while selling them back to us at a profit. On top of that, we would be thanking them for the jobs they have created. That is what Bill C‑11 remedies by giving the CRTC the tools it needs to support all actors that decide to do business in Canada.

Online broadcasting services occupy a space that is constantly growing in the broadcasting ecosystem. In Quebec, 70% of francophone adults subscribe to at least one on‑demand video service, with Netflix being at the top of the list. In the francophone market, individuals in the 18 to 34 age group consume on‑demand online content more than they do traditional television. In the 18 to 24 age group, people watch YouTube nearly eight hours a week, while TikTok is now one of the most used platforms by the youngest people and has grown by 55% over the past year. The TikTok platform even became an official partner of the Cannes Film Festival this year and created for the event a competition of short films under three minutes in which both experienced and emerging filmmakers participated. This situation was unimaginable only a year ago.

The use of social media to broadcast original and professional audiovisual content to reach audiences that are forsaking traditional media is a phenomenon that will keep growing. So it is essential that Bill C‑11 enable CRTC to include in its area of jurisdiction both subscription-based streaming companies, such as Netflix and illico, and social media companies, such as YouTube, Facebook and TikTok.

It is also important for companies that provide Internet and mobile telephone services to be included in the bill, so that the CRTC may potentially determine how they could contribute to the creation and presentation of Canadian content. Those companies are currently completely excluded from the application of the act. Yet they play an important role in the ecosystem, not only by enabling content broadcasting and distribution, but also by providing privileged access to certain broadcasting platforms. For instance, Telus users get free access to ICI TOU.TV Extra; Vidéotron users have the same privilege, for three months, for Vrai and Club illico; and Bell Media and Rogers offer similar packages for Crave or Disney+.

The AQPM is also proposing certain amendments for the audiovisual industry, which are the result of a collaborative effort with the Coalition for the Diversity of Cultural Expressions or with the Canadian Media Producers Association and the Alliance des producteurs francophones du Canada. I may tell you about this later. Otherwise, I will send you those amendments.

Thank you very much.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Ms. Messier.

I'm going to go to BCE Inc. for five minutes, please.

[Karine Moses, Vice-Chair Québec and Senior Vice-President, Content Development & News, BCE Inc.]

Madam Chair and honourable committee members, thank you for hearing from us today.

Bell is Canada's largest broadcaster. We operate a variety of broadcasting services across Canada in English and in French.

We support Bill C‑11 and urge its swift passage into law. It is long overdue. The bill begins to level the playing field between us and our foreign competitors, and that is important to the Canadian broadcasting system.

That said, the bill can and must be improved. Bluntly put, it does not properly recognize the central role Canadian broadcasters should have in our own broadcasting system. After all, it is the Broadcasting Act. The discussions to date—including those that occurred as part of Bill C‑10—have dealt with important issues, but have also almost completely ignored what domestic broadcasters require to succeed.

As it stands, Bill C‑11 does not explicitly incentivize foreign content providers to work in partnership with Canadian broadcasters.

This needs to change. Let me explain why.

Historically, Canadian broadcasters have succeeded by running hugely popular U.S. shows that appeal to Canadian audiences and attract significant advertising and subscription revenues. In turn, these revenues are used to fund the creation, production and showcasing of Canadian content.

At Bell Canada alone, we spend $1 billion annually on Canadian productions, both our own and with independent producers. Part of this spend is for local, national and international news that provides uniquely Canadian perspectives on events here and around the world.

Let me be clear. Everything we are able to achieve as Canadian broadcasters is directly related to the profits we make by accessing foreign content. Without it, we simply don't have a business. We have achieved that access through a regulatory regime that enables it.

Go ahead, Jonathan.

[Jonathan Daniels, Vice-President, Regulatory Law, BCE Inc.]

How did the regulatory regime enable it? Through bold regulatory decisions that were made over 50 years ago to harness the power of Hollywood for the greater good of Canada through creative regulatory measures that put Canadian broadcasters at the centre of the broadcasting ecosystem.

Licence rules required partnerships between foreign and Canadian broadcasters, creating such success stories as Discovery Canada, a partnership between Bell Media and Discovery. Another example is simultaneous substitution rules that ensure that broadcasters can monetize all the Canadian viewership and generated revenues that could be funnelled back into news and Canadian shows. These solutions were not always obvious. It took the vision and fortitude of your predecessors to bring our ecosystem to life.

Let's be clear. Today these rules no longer work. Our access to popular U.S. shows has become increasingly challenging and expensive. Foreign streamers are bidding up the costs of programming acquisition. Even more concerning is that major U.S. studios have either cut out domestic broadcasters all together or are about to do so. Disney+ and Paramount+ are already using their own streaming platforms to reach Canadians directly. Others like HBO have launched their own OTT platforms in the U.S. and could still choose to do so in Canada. With the ability to go directly to Canadians on an OTT basis, we are starting to see these platforms refuse to sell us their content all together.

Why does this matter? It matters because it puts all we do—and by "we", I mean all that Canadian broadcasters do—at risk. Canadian broadcasters produce Canadian news that quite simply is essential to our culture, to protecting our democracy and to our national sovereignty. Let's not delude ourselves. The entire Canadian broadcasting ecosystem is funded by profits generated from foreign content. We cannot expect broadcasters to continue to produce and support the Canadian content that we do without access to foreign content and partnering with foreign players.

We can ensure the central role of Canadian broadcasters by securing access to foreign content. We can also incentivize foreign streamers to partner with Canadian broadcasters, much like foreign linear services have done for decades. We believe Bill C-11 should explicitly enable this. That is why we are proposing two important amendments to clauses 3 and 5 of the act today.

Finally, we wanted to let you know we are supportive of both the CAB's and Unifor's proposed amendments. A copy of them, as well as our specific amendments to clauses 3 and 5 of the act, are attached in our submission that we sent to the clerk.

Thank you for the opportunity to present our views. We look forward to answering your questions.

[The Chair, Liberal, Hedy Fry]

Thank you very much.

Next up is Black Screen Office and Ms. Jenkinson for five minutes, please.

[Joan Jenkinson, Executive Director, Black Screen Office]

Good afternoon.

My name is Joan Jenkinson. I'm the executive director of the Black Screen Office, which is a non-profit, non-partisan advocacy association.

Our mission is to make Canadian screen industries equitable and free of anti-Black racism and to empower Black Canadians working within the screen industries to thrive and share their stories.

The BSO was founded in the fall of 2020 with the support of Telefilm Canada and the Canada Media Fund in response to Canadians' growing awareness of the need to take action to fight anti-Black racism. By this fall, the BSO will have released three research studies. One is on creating authentic and inclusive content. A second report will be Canada's very first race-based audience survey. A third report is a comprehensive labour market study of Black professionals in the Canadian screen industries. We also support Black producers and creatives with content incubators, by creating pipelines to decision-making roles in the sector and in attending international film festivals and markets. We work with industry partners to fund Black content creators.

Thank you for inviting the BSO to talk to you today about Bill C-11—the bill to amend the Broadcasting Act. The BSO supports the Racial Equity Media Collective's submission to this committee with proposed amendments to the bill. We agree with others about the need to ensure that all the players who work within the Canadian broadcasting system that compete for Canadian audiences and earn revenues from it should also contribute to it. However, the bill could be improved with a few small consequential amendments.

Canadians of all backgrounds have not had access to programming within the Canadian broadcasting system that authentically reflects the diversity of this country. The proposed amendments in Bill C-11 will prioritize greater equity and inclusion. We welcome Bill C-11's references to serving the needs and interests of racialized Canadians, but wherever the word “racialized” is used, we ask that it be replaced with “Black and racialized”. We request this amendment as recognition there has historically been greater oppression of Black Canadians and greater barriers to inclusion for them than with other racialized Canadians.

For example, in the 2019 Statistics Canada survey, 45% of Black Canadians expressed that they experienced discrimination in the past five years compared to 27% from other visible minorities. This discrimination can play out in education, health care, employment, housing and, yes, the Canadian screen industries. There needs to be a targeted strategy to break down these systemic barriers and fight anti-Black racism. Lumping Black Canadians in with all other racialized Canadians risks policy and regulation being adopted that do not consider the specific needs and challenges of Black communities.

I would also like to address comments I've heard at this committee that under-represented Canadians have access to unregulated platforms, such as YouTube, for content that reflects them. I would like to ask why Black Canadians should be limited to user-generated and short-form content found on YouTube and TikTok and not have access to longer form stories found in serialized dramas, sitcoms and documentaries that reflect their lives, experiences and interests.

It is true that Black Canadians have access to content from the U.S. and the U.K. that is created by Black screenwriters, directors and producers, but that content does not reflect the Canadian Black experience. This is important. Canadian Black communities are incredibly more diverse than African American communities. We consist of communities in Nova Scotia and southern Ontario that are older than Canada, newer communities made up of people from the Caribbean, and more recent communities from Africa. With limited exceptions, the many stories of these various communities are not being told.

Why can't there be everyday Black Canadians in romcoms, sitcoms, sci-fi series, kids' show and documentaries?

The Black Screen Office looks forward to the swift passage of Bill C-11, with the proposed amendments and the subsequent CRTC proceedings that will create a regulatory framework that will support the creation, delivery and promotion of more Canadian programming that reflects the lives and experiences of Black Canadians.

Thank you, Madam Chair.

[The Chair, Liberal, Hedy Fry]

Thank you very much.

I'll now go to the Canadian Media Producers Association for five minutes, please.

[Reynolds Mastin, President and Chief Executive Officer, Canadian Media Producers Association]

Good afternoon, Madam Chair and committee members.

My name is Reynolds Mastin, and I am the president and CEO of the Canadian Media Producers Association. The CMPA represents more than 600 companies across Canada engaged in the production of Canadian programming.

With me today is Catherine Winder, a member of the CMPA board and the CEO of the Vancouver-based production company, Wind Sun Sky Entertainment. Catherine has built a prolific career as a multiplatform adaptor of intellectual property, with such projects as Star Wars, The Angry Birds Movie and Invincible, to name a few. Thank you for inviting us to appear today.

The CMPA supports the passage of Bill C-11. The modernization of our broadcasting regulatory framework is critical to maintaining our national sovereignty, promoting a diversity of voices in our system and serving Canadian audiences.

[Catherine Winder, Chief Executive Officer, Wind Sun Sky Entertainment Inc., Canadian Media Producers Association]

For your consideration, we are proposing three amendments to the bill.

The first amendment would help ensure that Canadians own Canadian stories, meaning Canadian ownership of intellectual property and of all the rights that make up ownership of a Canadian show.

Unfortunately, that’s not what’s happening today. When a foreign web giant commissions a show from a Canadian producer, while on paper the producer gets to keep the copyright, the deals are structured such that the rights and the financial upside are expected to be given up. The result is that most—if not all—of the show’s revenue is vacuumed up by Hollywood for the life of the property.

An updated Broadcasting Act would ensure that Canadians share in the success of their own IP. In assessing the definition of a Canadian program, the bill should instruct the CRTC to consider the extent to which Canadians effectively own the full range of intellectual property in that program. In support of this objective, the CRTC would assess the extent to which online streamers and broadcasters are collaborating with independent Canadian producers.

When Canadian producers own the rights to their own IP, they reinvest the revenues that flow from that ownership into hiring more Canadian talent and developing the next great Canadian show. Owning our own IP also means that Canadians are in the driver’s seat when it comes to who tells our stories and where and how they are told. Quite simply, ownership of Canadian IP by Canadians is an assertion of our national sovereignty.

Our second amendment is about ensuring a healthy balance in our broadcasting system by requiring fair negotiations between buyers and sellers of content. The buyer side of our system is currently concentrated in the hands of the foreign web giants, as well as Canada’s vertically integrated telecom companies. These buyers hold an outsized advantage in negotiations with Canadian producers. The reason for this is simple. They are among the biggest companies in Canada—and, in some cases, the planet—while Canadian producers are overwhelmingly small and medium-sized companies.

With the deck stacked against them, most producers are forced to agree to a “take it or leave it” upfront payment. This means that with little leverage to negotiate meaningful ownership for the bucket of rights associated with their IP, producers risk not getting their shows made at all.

[Reynolds Mastin]

Change is needed to correct this market imbalance. The bill should ensure that the CRTC is empowered to require and enforce collective terms of trade between these buyers and independent Canadian producers. Terms of trade would provide a code of baseline conditions to be used in good faith negotiations between the parties when licensing a program.

This is not a novel solution. In 2003, the U.K. adopted terms of trade in its own Communications Act. Less than a decade later, the value of the U.K. independent production sector had almost tripled. In fact, this tool has been so successful that the U.K. government recently announced that it would maintain and modernize terms of trade. Given its success not only in the U.K. but also in France and Germany, we are confident that the adoption of a terms of trade amendment in Bill C-11 would result in similar success here in Canada.

Our third and final amendment would be to close a legislative loophole that generally excludes telecom service providers from the application of the Broadcasting Act. This exclusion no longer makes sense at a time when ISP and wireless services are playing an ever greater role in our broadcasting system.

Today Canadians watch content through their phones, tablets, laptops, and yes, also in their living rooms on TVs but those televisions increasingly stream programs over the Internet. The CRTC should have the ability to determine whether and how telecom providers could contribute to the creation of Canadian programming and the policy directions should instruct the CRTC to do this in a way that protects consumers and upholds the principle that those who benefit from our system should contribute to it.

In closing, we applaud the government for the introduction of Bill C-11 and look forward to responding to any questions you may have.

[The Chair, Liberal, Hedy Fry]

Thank you very much.

I now go to Marla Boltman, executive director of Friends.

Ms. Boltman.

[Marla Boltman, Executive Director, FRIENDS]

Thank you. I'm going to switch to good evening now, Madam Chair.

Honourable members of the committee, thank you for inviting me to speak with you today.

I've had the pleasure of meeting some of you in advance of this bill's arrival at committee but for those I have not met, my name, again, is Marla Boltman, and I am the new executive director of Friends.

We have over 360,000 supporters, Canadian citizens from coast to coast to coast, who stand up proudly for Canadian culture in film, in TV, in music and in journalism, really in every space and place we can share our stories at home and abroad.

While I am new to the organization, I bring with me both a content production and entertainment law background, which for more than 20 years I have used to help advance the interests of those working in the Canadian cultural industries.

The last time my organization appeared before you to talk about Bill C-10 our name was Friends of Canadian Broadcasting. Today we are more simply called Friends. This is quite fitting because I'm not just here to talk about broadcasting. I'm also here as a friend of Canadian storytelling and Canadian cultural sovereignty, both of which will be affected by the work of this committee when this bill is adopted. I say “when” because I want to clearly and unequivocally state that, while it's not perfect, we support the adoption of Bill C-11 and believe it can be improved with some minor amendments.

One of the bill's imperfections lies in its silence when it comes to addressing the CBC's mandate. We are very disappointed by this, but a conversation about the modernization of our nation's public broadcaster clearly requires more singular attention, something that the government has committed to doing via Bill C-18, which we welcome.

In the meantime, I don't want to use these few minutes to give those who would like to see this legislation stalled any more reasons to pause, to prevaricate, to do nothing, because if we do nothing, how our stories are told, who gets to tell them and how Canadian audiences access these stories will all be decisions made by foreign tech giants, billion-dollar companies who have effectively been crashing on our cultural couch for almost a decade, paying nothing toward the structures and systems that allow Canadians to tell their own stories.

With the adoption of Bill C-11 we, as a country, will finally send a long-overdue notice to these foreign tech giants that their rent is due, but we cannot stop there. Bill C-11 must prioritize Canadian ownership and control of our broadcasting system as well as the content created to serve it. If it does not, these companies will not be paying us fair rent for the use of our home. Rather, their contributions may simply amount to a down payment on a broadcasting system that they could potentially own and control.

Our amendment to proposed paragraph 3(1)(a), jointly submitted with the Coalition for the Diversity of Cultural Expressions, is meant to address this ownership and control issue. As currently drafted, the language in proposed paragraph 3(1)(a) is a massive retreat of Canadian public policy. If we don't support our own media and preference over foreign media, then we are ultimately relegating ourselves to having no Canadian media at all.

We need only look to the decimation of the Canadian local news sector for a preview of what is to come if we do not take care of our media institutions, which is why support for Friends' amendment to proposed subsection 11.1(1), dealing with expenditure requirements, can lay the foundation for a stronger, more viable local broadcast news sector. It would help ensure that the cuts we've seen to local print outlets across Canada do not start coming to local radio and TV and that broadcasters have the resources to maintain quality local coverage.

In closing, I would like to remind this committee that the modernization of the Broadcasting Act isn't just about protecting industry and jobs. It's what Canadians want, Canadians who have sent a clear message to Ottawa that streaming platforms should contribute to Canadian storytelling and reflect our stories back to us. They think this is fair and we agree.

Thank you for your time and consideration on this incredibly important matter.

I am happy to answer any questions you have.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Ms. Boltman.

Finally, we will go to John Lawford from the Public Interest Advocacy Centre.

Mr. Lawford.

[John Lawford, Executive Director and General Counsel, Public Interest Advocacy Centre]

Thank you, Madam Chair.

The Public Interest Advocacy Centre defines the consumer interest in broadcasting as ensuring that consumers benefit from access to a wide variety of programming in the broadcasting system that offers choice in an affordable manner.

Unlike in 1991, consumers now pay for almost all broadcasting, whether with money or with personal information, including their online subscriptions, cable TV and video on demand, delivered by a BDU, or over the top, via the Internet. Consumers are now a key stakeholder in this debate. We are of equal importance to creators, platforms and producers.

We believe that extending CanCon financial support requirements to online services such as Netflix or Amazon Prime, and even social media platforms such as YouTube and Facebook, when used as program distributers, are generally supported by Canadians.

However, the bill grants the CRTC discretion to set the financial and potential other obligations of online undertaking registrants, no matter their size or type, provided they distribute any programs, which is overbroad. To solve this, we support an amendment to the bill exempting small online undertakings below a high Canadian revenues threshold, perhaps $150 million, from financial and other conditions. This threshold would not affect registration or information requirements.

Consumers naturally resist the insertion of CanCon into automated plays or algorithmic suggestions of platforms such as YouTube, and digital first creators are concerned that such discoverability tools will backfire and reduce their audiences.

PIAC believes that the user-generated content problem can be addressed by redefining “discoverability” as not one concept, but two: static discoverability and dynamic discoverability.

Bill C-11's only new mandatory broadcasting policy requirement is proposed new paragraph 3(1)(r), which states:

online undertakings shall clearly promote and recommend Canadian programming, in both official languages as well as in Indigenous languages, and ensure that any means of control of the programming generates results allowing its discovery;

Clearly, discoverability is key to the drafters and must stay in some form. This policy objective mandates both static discoverability and dynamic discoverability. The first half could be satisfied by a banner ad on YouTube that simply links, upon a consumer's click, to selected CanCon. It is static. It is unobtrusive and likely unobjectionable to consumers, but still clearly promotes and recommends CanCon.

The second half of the new policy objective is dynamic. It requires AI prediction tools to insert a CanCon video or song into a user's auto-play feature or to dynamically suggest links. It is intrusive and disruptive to the user's expectations and experience. It is overkill to achieve the goal of “promote and recommend” CanCon. It is even more intrusive than the exhibition requirements on traditional broadcasters, because the online world is a world of abundance and consumer choice, not scarcity, where mandated exhibition makes more sense.

Digital first creators are rightly concerned that the bill's requirement to use dynamic discoverability will backfire and actually demote the importance of, and user engagement with, their content. Canadian users who are involuntarily exposed to discoverability links will avoid or react negatively, thereby signalling to the AI globally and in Canada to demote the content.

The solution is to require only static discoverability tools and to require any Canadian content creator who wishes to have their content promoted, even by static discoverability, to apply to a new CanCon authorization authority, likely the CRTC. This will allow digital first creators the choice to continue to operate untouched by this entire regime, which PIAC believes they want, or to have their content promoted in the limited sense of static discoverability.

PIAC recommends amending proposed paragraph 3(1)(r) to remove the last 15 words, thereby directing the CRTC to satisfy the bill's discoverability requirement with only static discoverability tools.

I welcome your questions. Thank you.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Mr. Lawford.

Now we're going to go to the question-and-answer segment.

The first segment begins with a six-minute question and answer for each one of the parties on this committee. The six minutes includes questions and answers, so everyone please try to be succinct so I don't have to cut you off. This allows you to expand on some of the things you may not have been allowed to say in your opening remarks.

We will begin with the Conservative Party and Mr. Waugh.

Kevin, you have six minutes.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

Thank you, Madam Chair.

My disclosure to BCE is that I was an employee of your company for nearly 40 years. I'm going to start with you.

I find it astonishing that for 30-plus years, you made millions of dollars off U.S. productions, and you can sit and tell us in committee that others are holding back the U.S. production and now you're on the outside.

Live with Kelly and Ryan, The View, Dr. Phil, The Big Bang Theory, Ellen, American Ninja Warrior, Weakest Link, The Daily Show, The Late Show, Young Sheldon, NFL football—what do you pay today for American programming that is played on your stations across Canada on CTV?

That would be for Mr. Daniels or Ms. Moses.

[The Chair, Liberal, Hedy Fry]

Go ahead.

[Jonathan Daniels]

Thank you.

I'll give it over to Karine to give you the answers to your question about what we pay today. We pay a lot of money for American programming. We're not denying that. You say it's surprising, but that's the business model. The business model is that we pay a lot for American programming, and then we take that and we have regulatory requirements to put it into Canadian content, including news.

I think when you look at what we do, it is all about the collection of the two together. We are able to monetize our American content by partnering with them in a way that's profitable both for us and the Americans, the content owners, but now they're seeing an opportunity to cut us out. It's not just us. I'm talking about all Canadian broadcasters.

Therefore, the kinds of things you can associate with us producing, including Canadian programs, which you didn't list off, but I can ask Karine to list all of our examples of that.... To see all of those examples, look at all of that and ask, are we going to continue to produce that...? Especially with news, who's going to produce the news if we don't have a model that ensures that Canadian broadcasters still have a role to play?

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

That's a good point, because last year with TSN Radio, you flipped the switch on three markets, eliminated it in seconds, and then you went to comedy channels. You did this across the country, from Vancouver onward. You hold several radio properties, which are under Bill C-11. It's disrespectful to the listeners of TSN Radio, which you own in the Vancouver markets and so on. You cut Hamilton overnight and flipped the switch on the comedy channels without any input from the CRTC on licensing. It was just done. Jobs were lost and people were escorted out of the business. This is what we're seeing.

Yes, I'm going to give you kudos on Canadian news. You've exceeded your obligations in most markets. You have it in the morning, at noon, five and seven and late at night in many markets, so I will give you kudos for that. You've exceeded the hours required by the CRTC for news coverage.

At the same time.... You can talk about Canadian production, but I see very little Canadian production between seven and 10, which is the prime time. I see The Big Bang Theory over and over again at night. It's on three or four times.

Can we see any Canadian productions in the seven to 10 slot to promote Canadian culture, so that you don't have to go to L.A. and buy those foreign competitor shows that you're now up against, from the big, foreign people you just talked about? Is there any hope that Canadian programming from seven to 10 can rival other programming that people can see, other than the NHL?

[Karine Moses]

Yes, there is definitely hope. As we mentioned, we are investing $1 billion every year in Canadian content. As we speak, we have more than 150 projects under way with 75 independent producers here in Canada to develop Canadian projects. If we look at our prime-time schedule.... I don't think the debate should be around timing on the grid, but more about what Canadians want to watch and when, and on which platforms. That's what we're pushing.

You referred to a lot of titles that are American shows, but we have a lot of Canadian shows. We have Children Ruin Everything, Canada's Drag Race, Transplant and Cardinal. We have tons of shows in Quebec that are produced by our Quebec producers. Ninety-five per cent of our programming grid in Quebec is Canadian content. In English Canada, this is growing.

One of our strategic imperatives is to develop Canadian content more and more. Yes, we're investing in Canadian content.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

How's Crave doing? When I was at Bell and a streaming service like Netflix started, Bell thought at the time, “Don't worry. They're just streamers. They're not going to affect us.” You started Crave, then you closed Crave and then you brought Crave back.

How are you doing with Crave? If you're going to talk about the new media, which is streaming, have you put any money into Crave and Canadian shows on Crave? If so how much have you put into Crave?

[Karine Moses]

We have many Canadian shows on Crave. We never closed it. Crave was launched many years ago, and it has always been there since. In fact, we grew Crave because we included French-Canadian content in Crave. We have more than 6,000 hours of French-Canadian content in Crave.

It's a success story for Canadians. It's the only Canadian streaming service that provides content in both languages across the country.