Senate Hearings on Bill C-11 – A Look at the Eighth Hearing (Second Segment)

We are continuing our special coverage of the Bill C-11 hearings. Today, we are looking at the second segment of hearing eight.

The special coverage of the Bill C-11 senate hearings continues. While we did fall a little bit behind with these, this is understandable given how many details were poured over in the last few hearings.

For those of you are curious about our coverage of previous hearings, here are the older ones:

Hearing 1 – Privacy Commissioner and Global Affairs/Justice Department
Hearing 2 – Digital rights organizations and lobby groups (1)
Hearing 3 – Lobby groups (2) and platforms (1)
Hearing 4 – Lobby groups (3) and lobby groups (4)
Hearing 5 – Lobby groups (5) and lobby groups (6)
Hearing 6 – Music Canada / platforms (2) and lobby groups (7)
Hearing 7 – Scholars/researhers and digital first creators

The 8th hearing wound up being a star attraction to these hearings thanks largely to the controversy that blew up before it. During that hearing, we heard from more digital first creators and Digital First Canada. As you can imagine, that panel was very much opposed to the legislation in its current form. Some have even gone so far as to say that if the legislation goes through without amendment, that their careers are either over or they have to move their operations outside of the country to continue. So, it really highlights just how desperate of a situation things are for digital first creators thanks to this legislation.

So, this is likely going to be a tough act to follow, but we are moving forward with the second segment to see what happened. Like before, the video we are watching can be found here. While we will try to do what we can to summarize the points, nothing will truly beat the original video and transcript. Still, we are happy to provide what we can as well as the usual analysis that goes along with it. With that, let’s take a look inside this hearing!

Opening Statements

Michael Prupas of Muse began with opening remarks. He basically introduced himself and shared his time with Michael Solomon.

Michael Solomon of Les Films Band With Pictures Inc. Quebec English-Language Production Council. After introducing himself, he commented that he, along with his lobbying partners, enthusiastically support the passage of Bill C-11. He called for an amendment to the legislation and commented about how cultural pressure from America has been a long struggle for decades. He talked about the establishment of the CBC ion 1936. He then talks about the amendment about contributions of independent broadcasters.

Prupas decried the large tech companies potentially getting access to the Canada Media Fund among other things thanks to the aforementioned change. The translation error that was previously mentioned by other witnesses in past hearings was brought up. He also brings up language consultations and says that they support keeping the text of that section as-is.

Jean LaRose of Dadan Sivunivut opened with his remarks. He says his company supports Bill C-11. He spoke about the right of indigenous people to produce and release media in all formats. He also spoke about ownership of broadcasters in relation to indigenous people. He then calls for the power of the CRTC to set terms for the distribution of content online. He calls for the CRTC to have dispute resolutions between internet distributors and broadcasters. From there, he calls for greater powers of the CRTC to regulate online services and apps.

David Errington of Accessible Media Inc. then opened with his remarks. He says he fully supports Bill C-11. He says that broadcasters are increasingly turning to the internet to operate as virtual broadcasters. From there, he says that Canadians are increasingly cancelling their traditional broadcasting subscriptions in favour of these “unregulated” services online (this is clearly in reference to cord cutting). He called for greater regulation of online broadcasters.

Questioning the Witnesses

Senator Rene Cormier asked about consultations at the CRTC.

Prupas said that he hasn’t been consulted by the CRTC, but spoke about thei mportance of consultations especially with the francophone population.

Senator Cormier said that it’s important to protect official languages.

Prupas said the CRTC wanted to remove it and he supports that clause.

Senator Fabian Manning noted that much of the concern around Bill C-11 has to do with the definition of Canadian content. He notes how many referenced The Handmaid’s Tale as an example. A production can be manned, written, stars, and otherwise hire Canadian workers, but it won’t be classified as Canadian content. He asked if the witnesses see any way to increase flexibility of what is Canadian content.

Prupas responded that they key is the ability to produce the content. The Handmaid’s Tale, though set in Canada, does not benefit Canadian entrepreneurs. The governments funding is an important element in the financing of those Canadian shows. If we allow such productions to be classified as Canadian content, then it would decimate the entire independent production industry in this country. The ability to produce programs that are of interest to Canadian’s will disappear. So, he would strongly oppose any changes to the definitions of what counts as Canadian content.

Senator Julie Miville-Dechene asked about broadcasting.

Prupas responded by talking about the translation error in the legislation.

Senator Paula Simons asked about supports for these organizations as broadcasters go towards being streamers as more people move away from traditional broadcasting.

Errington responded by calling for the same rules to apply to virtual broadcasters. He wanted that security that the funding will still be there as that digital transition happens.

Larose spoke about mandatory carriage.

Senator Leo Housakos spoke about how, for the last few decades, three was a fear about how American culture was going to swarm and overtake Canadian culture. So, the government created a monopolistic environment for Canadian culture in an effort to protect it. However, today, there are these platforms that offer a unique opportunity. We’ve seen the results. Digital content creators and streamers have become successful and it has become a massive industry. Traditional broadcasters are complaining because these platforms are succeeding and making money and they are giving exposure his kids generation an incredibly marketplace for Canadian culture. As a result, he is excited because he thinks he can compete around the world. It seems to have given this incredible opportunity for markets that simply didn’t exist before.

So, he says, he gets this sense that we are dragging this modern day internet system into an old archaic broadcasting system. He’s looked at the bottom line of the old model and it’s dead. They are slowly trying to catch up to the internet. There’s no such thing as cable any more. He asked if he could get their perspective from the witnesses in light of young Canadians who believe in a new way of broadcasting.

Prupas responded by saying that he’s been in traditional production for many years and it’s American funding that is coming in because of the low dollar. Things are moving very quickly from Canadian producers to streamers who are largely owned by non-Canadians. He says that if you encourage those who come into Canada and produce content to contribute to the funds, then you encourage Canadian production.

From there, he says that he has listened to the digital first creators and says that he has great admiration for them. However, the average cost to produce a traditional broadcast program per hour is in excess of $5 million. He then cites several other markets with different numbers. He say that these high production programs are what is going to be attracting Canadian audiences (if no one was watching the digital first creators content, they wouldn’t be making money or sponsorship deals.) The ability for Canadian stories to find buyers in foreign markets is extremely limited, he says.

Senator Jim Quinn commented that he has listened with great interest the opportunity for the internet to spread Canadian culture. He notes that traditional broadcasters making the move to internet distribution models. He asked, isn’t it the consumer, at the end of the day, that decides what they want to watch? Does it not come down to the quality of content that’s going to draw the audience to a production? He says he’s at a loss on why we are missing out on that generation.

Prupas acknowledged that this is an important point that he is making, but the quality of programs depends on the budgets that are available to those productions. Yes, you can produce your own digital content in your home, but when it comes to producing high quality content that is going to attract audiences by the millions, it costs millions of dollars (not anymore. Digital first creators pretty much proved they are capable of attracting those high volume audiences and more. Further, if your content is so high quality, why don’t people want to watch it?) If funding isn’t available to those producers, then that programming will disappear.

Senator Quinn said that they have heard from platforms and they say they are willing to contribute.

Prupas responded by saying that Canadian content produced by streamers are largely produced in the United States. It is not programming that tell Canadian stories in a vast majority of the cases. It’s not about Canadian production. At the end of the day, the profits are going outside of Canada.

Senator Quinn said that they had heard from the previous panel that Section 4.2 puts at risk their ability to continue on in that internet space. How do you respond to their concerns?

After a long pause, Errington responded that there is a role for everyone to exist. He says he does take snippets of their programming and put them out on TikTok. However, when you talk about indigenous or francophone content, it has a stronger importance then that (Hey! No need to be a jerk here!) So, does he want those small TikTok people to go away? No. He says they are viable and should be able to participate in the system.

Senator Quinn asked if he supports amending section 4.2 so that it would allow those smaller creators to stay on and continue what the are doing.

Errington said that more Canadian content is better.

Kevin J. Goldstein of Accessible Media Inc. chimed in and said that this is a distinct issue from their issue. Issues surrounding user generated content and when we go into content that Prupas is making or professional content that a broadcaster might do are two very different things.

The hearing was then adjourned.

Concluding Thoughts

Compared to the last several hearings, this is definitely one hearing that is much lighter on content. Still, there were some remarks I think is worth addressing.

The comments by Prupas struck me as basically showing that for legacy producers and broadcasters, digital first creators either don’t exist or don’t produce content that is of interest to Canadians. Obviously, he is very very wrong on that and what is being produced by digital first creators is of not only interest to Canadians, but of interest to people around the world. Clearly, this realm of production and distribution is way far over his head, though that is not surprising. Scott Benzie took great pains to point out that creators like us do exist and we are here, and Prupas literally proved the assessment of the attitude of legacy producers accurate the very next hearing.

Obviously, I have to acknowledge Errington and Goldstein in the end at least throwing digital first creators a bone by saying the more Canadian content, the better. What’s more is that it is fair that these issues are outside their area of interest to them.

Of course, the problem in all of this is is that there is clear evidence of the growing interest in content flowing over the internet. The witnesses themselves acknowledge this. Yet, when Senator Housakos pointed out the opportunities that is presented by the internet, no one really flinched or even seemed to understand that point. Specifically, couldn’t these organizations take advantage of such a medium in their own way?

Over top of that, they themselves mentioned the phenomenon of chord cutting. They brag about how they create such high quality content that is of interest to Canadians, but if the content is so high quality, then why is this cord cutting issue even happening? Basic common sense suggests that maybe they misunderstood their audiences. Maybe the content they are producing isn’t as high quality as they think it is. If a $2 million production is struggling to compete with people supposedly making digital content in their homes with little more than a cell phone and an internet connection, is that not a sign that you are doing something horribly wrong?

Throughout the hearing, you could clearly see senators placing little flags along the way saying, ‘hello? Big transition happening. Lots of opportunities cropping up! Something you might be interested in!’ and the witnesses, for the most part, were completely oblivious from beginning to end. I think some of them truly believe that digital first creators is some niche thing that no one watches and ultimately, that speaks to how much they haven’t paid attention to what has happened in their own industries. Because of that, the worry I’d have if I was in the senators position is if these organizations are going to be money pits in the future.

Drew Wilson on Twitter: @icecube85 and Facebook.

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