Let's Talk TV: CRTC announces measures to support the creation of content made by Canadians for Canadian and global audiences

OTTAWA–GATINEAU, March 12, 2015 /CNW/ - The Canadian Radio-television and Telecommunications Commission (CRTC) today announced significant changes to ensure Canada's television system adapts to an audiovisual environment that is in profound evolution. This is the third in a series of announcements related to Let's Talk TV: A Conversation with Canadians, and the changes focus on the creation of content made by Canadians for both Canadian and global audiences.

Canadian television supports a thriving industry that employs nearly 60,000 people and invests over $4 billion each year in the creation of content made by Canadians. The television system, however, is undergoing a fundamental shift brought on by broadband Internet and wireless networks. Increasingly, Canadians are bypassing the traditional curators of content, the broadcasters, and watching programs in new ways: on their mobile devices, by binge-viewing multiple episodes of a TV series in one sitting and by accessing vast online libraries of content from around the world. In this age of abundance, the viewer is in control.

To foster the continued success of Canada's creative talent, the CRTC is removing barriers that stand in the way of innovation and reinventing its approach to content made by Canadians. These measures will ensure the creation and promotion of compelling and high-quality content that audiences in Canada and abroad want to watch.

Promoting and discovering content

For Canadian-made productions to succeed in a sea of digital content, they must be well-promoted and easily discovered by viewers, both within Canada and abroad.

As such, the CRTC will host a Discoverability Summit in the fall of 2015. This Summit will bring together innovators and thought-leaders from the public and private sectors to explore how technology can be used to help viewers find programs made by Canadians. Further details on this summit will be released at a later date.

The CRTC is also providing more flexibility to broadcasters, so that they can better promote original Canadian television programs.

Creating Canadian-made content for global audiences

The CRTC is also launching two pilot projects that provide a more flexible and forward-looking approach to the production and financing of Canadian programs. Under these pilot projects, live-action drama and comedy series that either have a budget of at least $2 million per hour or are based on best-selling novels written by Canadian authors will be considered as being Canadian productions, provided certain additional criteria are met.

These changes are intended to support a production sector that has the financial capacity to develop scripts and concepts, as well as to create and market big-budget productions that can attract global audiences.

The CRTC is calling on other policy makers and funding agencies to follow suit for the benefit of the television system and Canadians. For instance, existing funding models could be updated to provide incentives for international co-productions and co-ventures, promotion and international distribution opportunities, and the creation of online content.

Removing barriers to innovation

The CRTC is confident that content made by Canadians can compete with the best in the world. Certain protections are no longer needed in a world of abundance and choice, and where many Canadians no longer watch shows according to a broadcaster's schedules. The future of television lies in Canadians' proven ability to create compelling, high-quality content.

As such, the CRTC is reducing the quotas setting out the amount of Canadian programs that local television stations and specialty channels must broadcast. At the same time, the CRTC is ensuring that the majority of these stations and channels reinvest a portion of their revenues into the creation of content made by Canadians. For certain types of programs, such as drama and documentaries, broadcasters will continue to invest at least 75% of these funds on content created by independent producers.

To foster a more open and competitive market, the CRTC is also eliminating rules under which specialty channels, such as HGTV Canada and MusiquePlus, can only broadcast certain types of programs. As a result, existing channels will be able to acquire or produce shows that better respond to their audiences' interests and needs. Moreover, new specialty services will be able to enter the Canadian marketplace and compete with existing channels. Both existing and new channels will need to be innovative and creative to succeed.

Finally, the CRTC is allowing video-on-demand services to offer exclusive content to cable and satellite subscribers, as long as they are available to all Canadians over the Internet without a television subscription. This will enable Canadian services to compete on a more equal footing with online video services.

About Let's Talk TV

In 2013, the CRTC launched Let's Talk TV: A Conversation with Canadians on the future of their television system and how it can adapt to evolving technologies and viewing habits. The CRTC received more than 13,000 comments from Canadians during the conversation's various phases.

Today's announcement is the third in a series of decisions that will set out a new forward-looking framework that will guide the television system in the coming years. The CRTC previously announced decisions relating to cable and satellite companies' 30-day cancellation policies, local television and simultaneous substitution.

Quick Facts

• The CRTC is taking steps to ensure Canada's television system adapts to an audiovisual environment that is in profound evolution.
• The CRTC will host a Discoverability Summit in the fall of 2015 to explore how technology can be used to help viewers find content made by Canadians in the digital environment.
• The CRTC is experimenting with two pilot projects that will allow greater flexibility in the funding of Canadian programs.
• The CRTC is confident that content made by Canadians can successfully compete with the best in the world and that certain regulatory protections are no longer needed.
• The CRTC is allowing video-on-demand services to offer exclusive content to cable and satellite subscribers, as long as they are available to all Canadians over the Internet.

Quote

"Canadian television rests on a solid foundation. We have more than enough money and talent to tell our stories. But the system cannot remain frozen in time when the world around us is changing. That's why we are adopting bold and forward-looking measures to ensure that Canadians can produce and promote compelling content that attracts audiences within and beyond our borders. We know that it will not be easy for everyone to adapt to this shift. We are confident, however, that Canadian creators have the know-how and tools to succeed.

We are also asking: What makes a production Canadian? For too long, narrow criteria have prevented potentially successful content from being made by Canadians. In a world where the content's origin is secondary to its quality and desirability, we need to show more flexibility in determining which productions can benefit from financial support. We are taking the first steps in this direction with two pilot projects, and encouraging others to join us on this exciting journey. Let's give the world great content made by Canada."

Jean-Pierre Blais, Chairman of the CRTC

Associated Links
Broadcasting Regulatory Policy CRTC 2015-86 - Create
Let's Talk TV Notice of Hearing: Broadcasting Notice of Consultation 2014-190
Let's Talk TV: A Conversation with Canadians

Backgrounder

Additional information on the changes to the Canadian television system

The Canadian Radio-television and Telecommunications (CRTC) is confident that Canadians have the talent and creativity to produce content that audiences both in Canada and around the world will want to watch. It is introducing significant changes to the Canadian television system that will encourage the creation of this content. Below is additional information on some of these changes.

1. Promotional and marketing expenses for Canadian-made content

For content made by Canadians to succeed in the future, it must be widely available and visible. The challenge in today's television age is an abundance of choice. Hundreds of television stations and countless Internet channels broadcast programs. And traditional media, which have previously acted as content curators by bringing programs to air, cannot perform such a task to nearly the same degree. It is therefore important to connect viewers with content in new ways.

It will be easier for audiences in Canada and abroad to find content that is well-promoted, whether it is broadcast on television, watched over the Internet or made available on other platforms. This is a particular challenge for independent broadcasters who do not have the same resources as the larger companies.

The CRTC is providing these broadcasters with more flexibility to promote their Canadian-made programs. Independent broadcasters will be able to use up to 10% of the amount they invest in the creation of programs for certain marketing and promotional activities, such as payments made to other broadcasters for paid promotional time.

2. Promoting Canadian programs

Non-Canadian specialty channels, such as A&E and CNN, typically reserve two minutes per hour for television service providers to air advertising time (known as local availabilities). In Canada, this advertising time is used to promote Canadian channels as well as the services offered by cable and satellite companies. This represents a useful promotional opportunity that could be used more effectively. In an on-demand world, however, Canadians increasingly seek out programs rather than channels, and the promotion and discoverability of programs are key to their success. The CRTC is therefore requiring that at least 75% of local availabilities must be used to promote first-run, original Canadian programs on a daily basis.

3. Video-on-demand services

The Commission has separate rules for video-on-demand services available to cable and satellite subscribers and online video services. In the case of video-on-demand, these services must invest in Canadian productions and include these programs in their libraries, among other requirements. They are also not allowed to offer exclusive programs, since not all Canadians would be able to access them. Online video services, on the other hand, are exempt from these requirements.

The CRTC is introducing an important change to ensure Canadian video-on-demand services can compete on an equal footing with online video services. Canadian video-on-demand services will be able to offer exclusive content as long as they are available to all Canadians over the Internet. This means that Canadians would not need to have a cable or satellite subscription in order to access these services.

4. Funding models for Canadian-made programs

To create content that can compete with the best in the world, Canada needs production companies that have the capacity to develop scripts and concepts, as well as to create and market big-budget productions that can attract global audiences. The CRTC is launching two pilot projects that provide a more flexible and forward-looking approach to the production and financing of Canadian programs.

Pilot project 1

Under this pilot project, the CRTC will recognize as Canadian live-action drama and comedy productions based on the adaptation of best-selling novels written by Canadian authors.

Pilot project 2

Under this pilot project, the CRTC will recognize as Canadian live-action drama and comedy productions with a budget of at least $2 million per hour.

Productions under both pilot projects will have to meet only the following criteria:

• the screenwriter is Canadian
• one lead performer is Canadian
• the production company is Canadian
  • at least 75% of the services costs are paid to Canadians, and
  • at least 75% of the post-production costs are paid to Canadians.

These pilot projects are exceptions to the CRTC's standard Canadian program certification process. Generally, the CRTC certifies programs or series that meet each of the following criterion:

• the producer is Canadian
• the production earns a minimum of 6 points (out of a possible 10) based on the key creative functions being performed by Canadians, with at least one of the director or screenwriter positions and at least one of the two lead performers being Canadian
• at least 75% of the services costs are paid to Canadians, and
• at least 75% of the post-production costs are paid to Canadians.

Different rules apply for animated productions, co-ventures and official co-productions.

The CRTC will be looking to government departments and other relevant agencies to collaborate on these projects and to assist in measuring their success.

5. Set-top boxes

Most Canadians who subscribe to television services have a set-top box that they either purchased or are renting from their service provider. These devices transfer or convert video content, enabling it to be displayed on a television screen, and can be used for audience measurement purposes. Currently, the larger cable and satellite companies have a certain advantage since they can share this data with their own television stations and channels.

Data from set-top boxes could help all broadcasters better provide Canadian viewers with the programming they want to watch and could also be used to make more informed programming and scheduling decisions. It could also serve to increase revenues flowing to program creators.

The CRTC is requiring the industry to form a working group to develop an audience measurement system based on the data from set-top boxes. This group will be tasked with proposing technical standards, privacy protections and a governance structure, as well as determining how costs will be shared.

The working group must report back to the CRTC on its progress by June 10, 2015.

6. Canadian-made content on television

Although television quotas have helped to create a thriving television industry in Canada, they have also created a situation where some programs are repeated on the same television channel or recycled from other channels. A particular episode of a program is often repeated numerous times over the course of a day, week, month and even a period of many years. Although they once served an important purpose, they are less useful in an on-demand environment where content is increasing fragmented and available across multiple platforms.

The CRTC is reducing the quotas for the overall amount of Canadian programs that local television stations must broadcast during the day from 55% to zero. However, more Canadians watch television between 6 and 11 p.m. on weeknights than at any other time. It is important for Canadian-made programs to continue to be available to viewers at these times, particularly since simultaneous substitution provides television stations with an incentive to air non-Canadian programs. The CRTC is therefore keeping the requirement that 50% of the programs broadcast during prime time must be made by Canadians.

The CRTC is also harmonizing the requirements for specialty channels, which range from 15% to 85% depending on the service. Going forward, specialty channels will have to ensure that 35% of all programs broadcast overall are made by Canadians. There will no longer be a specific requirement for the evening hours.

7. National news services

The CRTC requires that Canadian news services be offered to all television subscribers. This ensures that Canadians have the option of subscribing to a wide range of Canadian news services, either in bundles or à la carte. To make sure that Canadians have access to high-quality news, information and public affairs programming from various viewpoints, the CRTC is introducing new requirements for national news services.

In addition to their current requirements, new and existing services will need to:

• broadcast an annual average of 16 hours per day of original programming, seven days a week
• draw at least 95% of all programming broadcast each month from these program categories: news, analysis and interpretation, long-form documentary, and reporting and actualities
• operate a live broadcast facility and maintain news bureaus in at least three regions other than that of the live broadcast facility
• comply with the Radio Television Digital News Association of Canada
  (RTDNA) Code of (Journalistic) Ethics, the Canadian Association of Broadcasters' Code of Ethics and the Journalistic Independence Code, or other similar codes, and
• have the ability to report on international events from a Canadian perspective.

SOURCE Canadian Radio-television and Telecommunications Commission

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Related Links

http://www.crtc.gc.ca