Canadian Heritage Committee on June 2nd, 2022

[The Chair, Liberal, Hedy Fry]

Hello, everyone.

I call this meeting to order.

Welcome to meeting number 30 of the House of Commons Standing Committee on Canadian Heritage.

I would like to acknowledge that this meeting is taking place on the unceded traditional territory of the Algonquin Anishinabe people.

Pursuant to the order of Thursday, May 12, the committee is meeting to study 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. Those attending in the room must be masked for safety reasons.

To those on Zoom, please look at the bottom of your screen. You will see a microphone icon. Please mute yourself until you are ready to speak, and then you can unmute your microphone. There is also a globe icon at the bottom of the screen that helps you go into French or English, depending on your choice. Those in the room know that they can plug into translation at any time.

We're not allowed to take photographs during the meeting.

I want to ask you one more time to remember to speak through the chair.

Witnesses, please wait until I recognize you by name before speaking. For those participating by video conference, click on the microphone to activate or close it. Thank you very much.

We're going to the first panel. Witnesses, you each have five minutes for your organization. You can decide how to divide up the speaking time within your organization. I'll give you a 30-second call, so that you can wrap up, and then we will go to a question and answer segment. I will tell you how that works then.

The witnesses in this round today, from 3:30 to 4:30, will be as follows. From the Canadian Independent Music Association, we have Andrew Cash, president and chief executive officer; from the Canadian Taxpayers Federation, Jay Goldberg, Ontario director; from ICI Television, Sam Norouzi, vice-president and general manager; and from the Society of Composers, Authors and Music Publishers of Canada, we have Andrea Kokonis, chief legal officer and general counsel.

To begin, we'll hear from the Canadian Independent Music Association and Mr. Cash for five minutes, please.

[Andrew Cash, President and Chief Executive Officer, Canadian Independent Music Association]

Thank you very much, Madam Chair.

Good afternoon, everyone.

I'm the president and CEO of CIMA, the Canadian Independent Music Association.

Our membership includes Canadian-owned music companies, artist entrepreneurs, managers, publishers, promoters, consultants and many other solo self-employed entrepreneurs.

CIMA supports the principles behind Bill C-11. Every entity doing business in Canada operates under some form of federal or provincial regulatory requirements. Online streaming and social media companies should too. These platforms should contribute back into the cultural ecosystem they profit from in the form of, among other ways, financial contributions that can be invested in the sector's industrial infrastructure and artists. We think these things are fair and reasonable and, frankly, a very long time coming.

For over 25 years I was a singer/songwriter, producer/performer and I have to tell you that rarely a day passed when I didn't think: How can I build an audience outside of Canada? That's because the music I was making often didn't fit into the narrow confines of Canadian radio formats at the time. Sometimes it did, but usually it didn't. It was pretty clear that in order to survive, make a living, raise a family, in other words have a middle-class income and life, I had to find a global audience for my songs, which, by the way, I never quite found.

But today, because of a number of factors, including the opportunities created by streaming and social media platforms, more and more of our artists and labels are building that global audience, whereas in the past they would have had no commercial avenue. I think that may be why 75% of all Juno nominees this year were from the Canadian-owned independent sector, and many are finding audiences in markets all over the world.

This growth is also made possible by important public investments in the industrial infrastructure of the Canadian-owned sector through FACTOR and Musicaction. This is a huge success story and a reminder of the importance and potential impact of additional funding from new digital platform partners to the system.

You know that too often when we talk about creators, we tend to hold up the exception as the rule, the über-successful influencer on Instagram, the number of streams Drake has amassed this month or the hit bands that underpin the CanCon structure of terrestrial radio. But they don't tell the true story or the whole story. It has always been, and continues to be, a precarious feast-or-famine life for 95% of those who work in the creative arts, both on and offline—including, alas, Juno nominees. But we do have an incredible opportunity here now to begin to lay a new foundation to build and grow a more stable middle-class arts and culture sector in Canada. So we must really understand the sector we are attempting to legislate and regulate, the opportunities for our artists and Canadian-owned labels if we get it right and the serious ramifications if we get it wrong.

CanCon was put in place to build a domestic industry for a domestic market. Today, we need to invest in the success of Canadian companies and artists for a global market. For CIMA members the best way for Canadian artists to be discovered is to have incredible artists supported by excellent, smart, well-resourced and highly competitive companies that can succeed in the global marketplace, with IP ownership remaining in Canada. We applaud anything in this bill that successfully facilitates these goals. An outcome that results in Canadian artists locked into Canadian-only playlists and a Canadian-only digital ecosystem would be unacceptable.

How music is promoted and shared by music fans on social media platforms has become key to the growth of Canadian-owned independent music, and so we agree with and support the comments by the minister and the chair of the CRTC, who have both said that so-called user-generated content would not be regulated.

Today, music companies have commercial relationships with platforms, therefore, we must ensure the cost of the financial contributions a platform may be required to make—

[The Chair, Liberal, Hedy Fry]

You have 30 seconds left.

[Andrew Cash]

—will not be passed on to Canadian-owned independent labels or artists and that those contributions are not tied to what content is or is not in the bill.

The music business has always been complicated, and is even more so now. We want to ensure that creators who are impacted by Bill C-11 are consulted and that our voices are heard when this bill gets to the CRTC.

I would like to also underline CIMA's support for CDEC's amendments, as well as for the Racial Equity Media Collective's submission and suggested amendments, which would ensure the government's stated objective to see greater equity and inclusion in the broadcasting system is achieved.

We look forward to building stronger partnerships between artists, Canadian-owned labels, platforms and the cultural policy objectives of the Government of Canada.

Thank you so much.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Mr. Cash.

Now I'll move to the Canadian Taxpayers Federation and Jay Goldberg for five minutes, please.

[Jay Goldberg, Director, Ontario, Canadian Taxpayers Federation]

Thank you very much.

I'm very grateful to be here today to speak on behalf of tens of thousands of supporters, including tens of thousands of Canadians who have signed our petition calling on the government not to move forward with Bill C-11.

The Canadian Taxpayers Federation is concerned by this bill for three key reasons.

First, the government's “empower the CRTC now, give guidance later” approach raises major concerns about accountability. There are many Canadians who are asking why the government is trying to give such unprecedented power to an entity like the CRTC without first sharing with Canadians exactly how much power and on exactly what basis it plans to do so. The government has said that instructions and guidance will come later, but that's a backward approach when it comes to accountability.

Second, contrary to the government assertions, the CRTC has determined that user-generated content will be regulated by the CRTC under Bill C-11 through broadcast regulation. As Professor Michael Geist has said, “no other country in the world regulates content in this way”, and to do so is a major threat to individual freedom. Again, many are asking why the government wants to give the CRTC the power to regulate user-generated content while at the same time saying that it's not.

Before I move to my third point, let me note that although the government has insisted that user-generated content won't be regulated, CRTC chair Ian Scott told this committee that “section 4.2 allows the CRTC to prescribe by regulation user-uploaded content subject to very explicit criteria”. In addition, the very fact that user-generated content would be regulated demonstrates that this bill is not, as the minister and others have suggested, solely about Canadian culture.

Third, this could set a very dangerous precedent for the future. Today, this new government regulatory machine that is being built plans to filter content based on what it considers to be Canadian, but this could be repurposed in the future for other means. Not being able to hold the CRTC accountable in determining what is or is not Canadian content may concern some, but not being able to hold it accountable on future issues such as social cohesion, as Minister Mendicino has alluded to in the online harms conversation, is even more concerning.

There are also deep concerns about the process of this legislation, the lack of debate and the government failing to genuinely listen to Canadians. Our right to free speech and free expression must be sacred, and we should not be in a situation in which a bill like this is being pushed through Parliament in this way, with such limited debate and opportunity.

Thank you for having me here. I look forward to your questions.

[The Chair, Liberal, Hedy Fry]

Thank you, that was wonderful.

You were three and a half minutes. Thank you very much, Mr. Goldberg.

I now go to ICI Television and Mr. Norouzi for five minutes, please.

[Sam Norouzi, Vice President and General Manager, ICI Television]

Good morning, Madam Chair and members of the committee.

My name is Sam Norouzi, and I'm here with you today representing ICI Television. ICI is an independent, multi-ethnic television station based in Montreal that offers original programming in 15 languages and serves over 18 ethnocultural communities. ICI is available on all basic cable and satellite services, in addition to being available on Hertzian waves in the Greater Montreal area.

Since September 1, 2017, in partnership with OMNI Regional, ICI is available on all basic services in Quebec.

[Chris Bittle, Liberal, St. Catharines, ON]

Madam Chair, I have a point of order.

[The Chair, Liberal, Hedy Fry]

Yes? I do not know who has raised the point of order.

[Chris Bittle, Liberal, St. Catharines, ON]

It's Chris.

It's just an issue with the translation. We're not getting English translation.

[The Chair, Liberal, Hedy Fry]

I'm sorry. I am getting it.

Could we suspend while that is fixed please, Clerk?

[Martin Champoux, Bloc, Drummond, QC]

It's been fixed, Madam Chair.

[Alexie Labelle, Legislative Clerk]

I'm told that it is back on.

[The Chair, Liberal, Hedy Fry]

Is it back on? I don't know. I'll have to hear from the clerk.

[Alexie Labelle]

It's on.

[The Chair, Liberal, Hedy Fry]

Thank you.

Continue, Mr. Norouzi.

[Sam Norouzi]

I'm here today because of the critical gap in Bill C-11 that could see millions of Canadians lose access to their beloved public interest TV channels over the next few years. We are one of those channels.

For many ethnocultural communities in Quebec, ICI Television is the only source of locally created television programming in their language available at little or no cost.

Our programming is developed by a network of local independent producers who have deep ties to their communities and decades of experience in producing quality television programs.

We cover current events from a local perspective, and connect people in Montreal and throughout Quebec to what is happening around them. We make a difference. However, telling local stories requires resources.

To help keep the lights on, we rely on an order by the CRTC that requires all cable and satellite services to carry our programming as part of their basic TV package and to pay a fixed rate tied to their number of subscribers. ICI is one of a small number of specialty channels that relies on the CRTC in this way.

These channels are known as 9(1)(h) services, a name which comes from the section of the Broadcasting Act allowing the CRTC to issue these orders in support of public interest programming.

You know many of these channels. Let me share a few examples. There's CPAC, which provides Canadians with unfiltered access to Parliament, and committee meetings just like this one. APTN tells the stories of indigenous peoples in Canada in their own voice. AMI-tv and AMI-télé help Canadians living with disabilities access TV programming.

In addition, there is TVA, which has a mandatory distribution order outside Quebec, which supports official language minority communities.

Together with our partner, OMNI Regional, ICI provides Canadians with information and entertainment in their own language, including six daily newscasts in six languages, from a Canadian perspective.

Canada's public interest TV plays a critical role in serving racialized and marginalized communities. We promote tolerance, diversity and inclusion. We help protect our democracy from disinformation.

With more Canadians shifting to online streaming, we need our broadcasting rules to keep up. As Ian Scott told you earlier this week, Bill C-11 doesn't extend the rules for 9(1)(h) services to online streaming. Instead, it leaves our future to good-faith negotiations. However, global web giants like Amazon, Google and Apple know they won't make money off of our content. They have no real incentive to negotiate, and we can't compete with their legal departments.

That is why we are asking you to amend Bill C-11 to help level the playing field and allow the CRTC to set terms and conditions for programming in their online distribution.

Giving the CRTC the power to set the terms of carriage for online public interest programming services would support us and level the playing field for conventional broadcasters competing with online distributors.

We need this change so that we can keep our lights on and serve Canadians in a way that meets their needs—

[The Chair, Liberal, Hedy Fry]

You have 30 seconds left.

[Sam Norouzi]

—whether that is over the air, through cable or satellite or online.

I ask you to consider the racialized and marginalized communities that rely on us. These Canadians need you to act now and amend Bill C-11 to protect the future of made-in-Canada public interest television.

Thank you.

I will be happy to answer your questions.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Monsieur Norouzi.

I will go to the Society of Composers, Authors and Music Publishers of Canada, and Andrea Kokonis, for five minutes, please.

[Andrea Kokonis, Chief Legal Officer and General Counsel, Society of Composers, Authors and Music Publishers of Canada]

Thank you and good afternoon. My name is Andrea Kokonis. I am general counsel at SOCAN. I am pleased to appear before this committee in support of Bill C-11, the online streaming act.

SOCAN congratulates the government on the tabling of Bill C-11. The bill delivers on the minister's promise to regulate online streaming services while excluding its application to individual content creators. This represents a big step in the right direction for Canadian creative sector and for Canadian audiences.

Modernizing Canada's broadcasting legislation today is necessary. The Broadcasting Act was enacted long before the Internet became a dominant platform for the delivery of music. Online streaming has experienced explosive growth in recent years, but Canadian songwriters and composers are not benefiting from that growth. This inequity is due in part to the fact that the streaming services that have benefited greatly from operating in Canada are not required to contribute to Canadian culture.

SOCAN itself has experienced considerable growth in revenues from online streaming. In 2021, SOCAN collected $416 million on behalf of Canadian and foreign rights holders, of which $100 million was from digital sources. SOCAN's collections from digital platforms will soon overtake collections from more traditional sources, such as radio and television. Unfortunately, only a fraction of this digital licensing revenue stays in Canada. For every dollar generated from Canadian TV and radio broadcasters, approximately 34 cents is distributed to Canadian songwriters and composers. But of the revenues generated from online streaming services, only 10 cents is distributed to Canadians.

The situation is even more dire for francophone songwriters and composers who receive only 1.8 cents per dollar generated from online streaming services as compared to 7.4 cents from Canadian broadcasters.

The difference between broadcasting and online revenues that flow to Canadian songwriters and composers is due at least in part to the fact that streaming services are not required to support or promote Canadian creators to Canadian audiences. The market alone has not and will not solve this problem. Only legislative reform can do that, and the online streaming act sets the stage.

Online streaming services like traditional broadcasters must contribute to Canadian culture by participating in financial support programs that help foster the creation of Canadian music. Online streaming services like traditional broadcasters must also participate in the promotion of Canadian music. Canadian content must continue to hold a prominent place for Canadian audiences whether broadcast on television, radio or streaming platforms.

Foreign streaming giants that benefit from unfettered access to Canadian audiences should be supporting our cultural community and the next generation of Canadian songwriters and composers. As online streaming becomes the dominant medium for music distribution, that support becomes even more important. It is vital to the survival of our culture and our cultural sovereignty.

Canadian music creators need to be actively promoted by the streaming services that provide content to Canadian audiences. Promotion helps Canadian songwriters, composers and music publishers find an audience and generate revenue for themselves so they can reinvest in others.

Viewer choice is not enough and frankly misconstrues the role that online streamers play. Online platforms already decide who to promote and who to demote on their services. They already play those curatorial and editorial roles and should fulfill those roles by showcasing Canadians to Canadians. Online platforms must help emerging Canadian talent get discovered and reach Canadian audiences. It is not just Canadian songwriters and composers who will benefit; listeners will too. We all benefit when our cultural policies reflect and encourage the Canadian experience and the creation and dissemination of Canadian stories and songs.

We implore the government to require streaming services to play their part in making it easier to find Canadian music and stories on online platforms in Canada.

SOCAN does not propose any amendments to Bill C-11. The bill must remain broad so that it can adapt to future online services, the models of content delivery from which are not yet known. A bill that is tailored only to services in operation today or that carves out specific services as they exist today will not be flexible enough or have staying power for the future of broadcasting online.

For all of these reasons, we urge the government to pass Bill C-11 as soon as possible. The creative industry is an important economic sector in our country. The best way to support it is through legislative reform and the online streaming act.

Thank you for your consideration. I'd be happy to answer any questions you may have.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Ms. Kokonis.

Now we are going to the first question and answer session. It's a six-minute session, and please be aware, witnesses and colleagues, that the six minutes includes the question and answer.

We begin with Ms. Rachel Thomas for the Conservative Party.

You have six minutes.

[Rachael Thomas, Conservative, Lethbridge, AB]

Thank you very much, Chair.

My first question is for Mr. Goldberg.

Mr. Goldberg, I'm wondering if you can just talk to me a little bit about the work you do on behalf of Canadian consumers and how Bill C-11 might impact them and what your concerns are around that.

[Jay Goldberg]

Yes, thank you for the question.

Essentially, we're deeply concerned about this legislation because it could impede the ability of Canadians to hold the government accountable, and as an organization we focus on less waste, lower taxes and more affordable government. Unfortunately, this legislation sets a very dangerous precedent. It allows for this brand-new regulatory machine that can filter content based on what it considers to be Canadian, but what we're all concerned about is the potential for that to expand into other areas in the future. It may not be phrased that way now, but we have to worry about what governments might do in the future and what ground this lays for potential stretching as we go forward.