Backgrounder Article from  Canadian Radio-television and Telecommunications Commission

Archived - Additional information on the changes to the Canadian television system

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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.

Associated Link

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

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