by Ian Austen
Canadian Forum, May 1996
Republished with permission

Who's the real Izzy Asper? Is he the media mogul whose Global Television Network was effectively heralded as a force for Canadian culture in a late February press release from federal broadcast regulator Keith Spicer? "We are pleased that the licensee has exceeded the minimum expenditure of over $30 million a year on Canadian programming," the CRTC chairman noted while announcing a seven-year renewal of Global's licence.

Or is he the man whose broadcasting vision was portrayed on a cover of Maclean's that appeared just a few days before Spicer's announcement? "Izzy's dream," as the magazine called it, was depicted by a series of television sets showing Global's programming highlights. Four displayed top-rated, U.S. network imports; the fifth featured Izzy's face.

While the magazine illustrator didn't include Global's new Canadian series, Traders, he was nevertheless much closer to the mark about Asper's record as a cultural force than Spicer's upbeat praise. Unfortunately, Asper—who wants to make Global the third national English TV network—has plenty of company. Despite years of effort and study, stacks of regulations and millions of government dollars, English Canada's commercial broadcasters remain largely distributors of the best Hollywood can offer. In short, we've been had, and amazingly, given the current focus on the CBC's sins, hardly anyone seems to be noticing.

Take, for example, most media coverage of the CBC, National Film Board and Telefilm Canada mandate review committee's report [the Juneau Report]. Predictably, reporters were fixated on the panel's suggestion that a modest tax on things such as cable bills should pay the CBC's freight. Almost entirely ignored was the section on Telefilm, the semi-invisible federal agency that's the biggest investor in most entertainment programming on private TV, including the much hyped Traders. While the committee revealed lots of problems with CBC English TV, it was even harsher in its criticism of the private networks."lf the limited amount of Canadian programming (and particularly drama) on our television screens—and the disproportionate amount of time that Canadians devote to watching American programs—is not seen as a cultural crisis, it is only because English-speaking Canadians have grown too accustomed to this situation. It is not now, and never has been, a case of Canadian programs being provided and rejected by domestic audiences."

As the report suggests, the dismal state of private TV is hardly a recent development. Still, it's hard to imagine a more crucial time to start looking at private TV's invisible cultural crisis. As the CBC's resources continue to be squeezed, it becomes more important than ever to press the point that private broadcasters aren't doing us a favour by producing Canadian programming—it's the price of some very valuable considerations from the government. Over the coming months, opportunities to address the issue will surface, including eight CRTC commissioners' spots, among them the chairman's, becoming vacant; an internal review by the Heritage and Industry departments of the CRTC's role and operations; Asper's station licence applications to create his national network; and growing calls for regulatory change prompted by the so-called information highway, calls that have been dominated by industry demands for less regulation and lower Canadian content requirements.

If you only read private broadcasters annual reports and their CRTC submissions rather than watching their programming or even glancing at the TV listings, you might think they actually are major forces for Canadian culture. It's rare that a private broadcaster doesn't appear before the CRTC without an introductory videotape that includes some aerial views of the Rockies, Canada geese in slow-motion flight and perhaps a quaint Innu woman for good measure. When private operators actually produce a Canadian show, their publicity departments do their best to ensure that everyone knows about it —Asper posed with the stars of Traders for publicity photos and even did a walk-on part in one episode.

But nothing turns private broadcasters into greater patriots than the emergence of anything they perceive as a threat to their profit margins—whether it's tax changes, increased regulation, the advent of cancon in the '60s or, more recently, direct to-home satellites. Any decline in their financial performance, they term in usually apocalyptic terms, to doom Canadian production, if not the very fabric of Canada itself. New means of electronic communications are emerging as the latest enemy. Last year's Canadian Association of Broadcasters' convention lamely attempted lay claim to that territory with its theme "Private Broadcasting: Canada's Voice on the Innovation Highway". On the whole, waving the Canadian flag while filling the airwaves with American shows has paid off handsomely. Asper, for one, is estimated to be personally worth 30 million, much of it generated by his company CanWest Global Communications Corp. In the first months of its current fiscal year, CanWest's Global—which broadcasts in Ontario, It does not include the company's Saskatchewan and Atlantic Canada operations—saw its profits rise 36 percent to $66 million on revenue of 71 million. Most of that came from broadcasting popular U.S. sitcoms ch as Seinfeld and Friends.

Asper's performance is not an isolated example. Last year, Vancouver's WIC Western International Communications Ltd., owner of eight stations, a pay-TV network and of the Family Channel, made $2.7 million (The major English private network, CTV, has an extremely spotty financial record. However, its customers are for the most part its owners, including WIC, and their balance sheets are uniformly bright in large part because of the mostly American programming CTV provides.)

Despite all the extreme hype about a possible 500-channel universe and the current rush for more Izzy Asper on the set of Traders cable specialty channels, an over-the-air broadcast licence remains a remarkably valuable piece of paper. Though only Belgium has more of its population connected to cable than Canada, when Canadians turn on the tube they overwhelmingly select conventional, over-the-air stations. The audience gap with the cable channels is startling. Government owned (at least for now) TVOntario is that province's smallest over-the-air network in terms of overall audience. Nevertheless, most of the time, more Ontarians are watching TVO than all the English specialty channels combined.

Licences aren't the only gifts given to private broadcasters. Few steps have been as influential in shaping private broadcasters' programming strategies and balance sheets as the CRTC's introduction of so-called signal substitution. Under the scheme, major cable companies must replace U.S. stations's signals with local Canadian channels' programming if both are airing identical shows. The identical programs are, of course, overwhelmingly American. Under signal substitution, Canadian stations grab 100 per cent of the local audience for their commercials. Its unintended effect is less desirable. Signal substitution creates a powerful economic incentive for private broadcasters to flood key viewing hours with American imports that are sure to be popular with both audiences and advertisers. (The CBC also benefits from the rule when it airs U.S. shows, although the public network has vowed to eliminate its primetime U.S. programming by this fall.)

Substitution has been a constant trade irritant with successive U.S. administrations. In theory, it should be worth the price of that aggravation. Private broadcasters were supposed to take a chunk of extra ad revenue the scheme generated and use it to develop Canadian programming. A CRTC background paper boasts that, thanks to signal substitution ion, "millions of dollars are returned to the Canadian broadcasting system". Perhaps to the system but not necessarily Canadian programming, as former CBC president Tony Manera points out. "This is a case where a public policy has been created to favour the interests of private broadcasters without adding any real benefit for consumers," says Manera, now a consultant after quitting the CBC in 1995 over cuts to its funding. "If the private broadcaster wasn't running those American shows, the consumer would still have access to them. But they'd just have to watch American commercials instead of Canadian commercials. So, big deal. "I think the private broadcasters owe some return to the Canadian system."

Most private broadcasters have the good sense to always honour the minimum CRTC Canadian content requirements. There are some exceptions, but generally private TV stations must make sure that 60 per cent of their programming measured over an entire year is Canadian, including at least half the shows between 6 p.m. and midnight. Quantity isn't the problem; it's how the commercial operators reach the quota.

Asper's Global is a good example. The actual decision that renewed its licence reveals how the network became an overachiever: "The Commission notes...that Global's overexpenditures during the current licence term were made entirely on news programming and not on entertainment programming." Though Global and most private broadcasters have improved their performance, Canadian content on private stations remains overwhelmingly news and sports. Both attract ads and are relatively cheap to produce. But news shows that are heavily laden with U.S. network reports from abroad and Blue lays baseball aren't really the stuff of national identity building. As well, neither sports nor news is what most viewers watch most of the time. Of the top 10 shows in the Toronto-Hamilton market early this year, none was a news program; one sports broadcast, CBC's Hockey Night in Canada, made ninth place. Most were imported American entertainment series that appeared on Global and CTV.

TVO chairman and mandate review committee member Peter Herrndorf gives private broadcasters some points for trying—at least a little. "Private broadcasters have done significantly better in the last 10 years. They do a lot more drama than anyone might have thought possible in the early 1980s." Not enough though.

"Having said all of that, compared to Australia, compared to Britain, compared to the U.S., compared to France; the commercial broadcasters here do quite modest amounts of indigenous programming. They still are locked to a considerable degree into that economic logic that's prevailed in Canadian broadcasting from the 1930s on."

The statistics back that up. There isn't any overall tracking of private sector performance by the CRTC, but it accepts a CBC study that found only 8.2 per cent of shows aired between 7 and 11 p.m. on Global in 1993 were Canadian drama or variety productions. The comparable figure for CTV is 7.9 per cent, while the CBC reached almost 17 per cent.

Indeed, the CBC research department's dismal findings may actually overstate the private networks' performance. Under the CRTC's and Telefilm's point systems for evaluating productions, some pretty strange things can qualify as Canadian content, especially co-productions. (The systems give up to 10 points for using Canadian talent such as actors, directors and cinematographers. A complex series of treaties, however, skews everything in the case of international co-productions.) CTV's "Canadian" offerings have included A Family of Cops, starring Charles Bronson as Milwaukee's police chief Programs filmed in Canada primarily designed for sale in the U.S. market that meet the bare minimum Canadian content levels are known in the trade as six-pointers. They've also become the greatest growth area in production, thanks in large part to the low value of the Canadian dollar. Turning parts of Toronto or Vancouver into Manhattan or Montana for a day certainly provides employment and revenue for independent producers, some actors and technicians. An occasional appearance by the odd Hollywood star is a nice diversion for passers-by, assuming they're not trapped in a film-related traffic jam. What most six-pointers do for Canadian culture, however, is at best unclear. Nevertheless, the push for more continues. The federal government's industry-dominated Information Highway Advisory Council, which reported last fall, was among the latest to join the cause. For cultural industries, it said, "[t]he objective must be a self-sustaining environment." Acknowledging that might not be completely possible, the report claims there's one way to reach most of the goal "Government policies could do more to encourage the production of exportable content. As markets multiply and diversify, Canadian cultural products must stand out and appeal to consumers. They must strive to achieve maximum quality and marketability and not simply take up obligatory shelf space."

It's not hard to see from a pure business standpoint why private Canadian TV broadcasters have become essentially pipelines for U.S. shows. It costs about $700,000 to $1 million to produce a single hour of real Canadian entertainment programming—an eight- or more pointer. While there are a variety of funds and agencies to help finance the show, its chances for commercial success are dicey. Canadian programs receive only a fraction of the free publicity that falls on even the lamest U.S. shows. Three seasons passed before the CBC's This Hour Has 22 Minutes made two Canadian mass market magazine covers. "If it was an American show, it would have had 30 American covers by now and it would have had eight Canadian" says Herrndorf. By contrast, the formula for success with simulisting U.S. shows is dead simple. You by a big American hit for about 90,000 a one-hour episode. Selling commercials is easy. Many advertisers prefer to drop their money on a simulcast of a US-made sure thing such as Americas Funniest Home Videos rather than an unknown 'Canadian' product. Those ads should pull in about 250,000, leaving a ross margin of 160,000. With numbers like that, why would you do anything else?

Despite the economic woes of the Ottawa Valley, the annual fall fair in Renfrew, Ontario, continues to prosper. Last year, mixed with the tractor exhibits, Super Stepper pitch men and back-bacon-a-bun booths, there were two outfits pushing direct-to-home satellite TV systems.

The continuing obsession of Canadian broadcast policy makers with distribution systems rather than programming has guaranteed a lot of attention for satellite TV over the past two and a half years. But despite all the hype and concern, satellite TV remains a tiny niche product used mostly by people in rural areas with either poor or non-existent cable service. In Renfrew's armoury. the fairground's biggest hall, the Women's Institute was dishing out apple pie and TV dealer Ben Sauve had perched a pizza-sized RCA DTH satellite dish on top of a massive Hitachi set. On the screen was one of the 175 channels—none Canadian— beaming into Canada's so-called grey market from Los Angeles-based Hughes DirecTV. The system's clear picture and crisp, CD-like sound certainly attracted attention. After they admired the screen, however, visitors consistently complained to Sauve about one major shortcoming "Many people have been approaching us about it. But they're not interested right now because they want Canadian content. I'd say nine out of 10 want Canadian content."

Many of those nine, it seems, define Canadian content as NHL hockey on the Toronto-based specialty channel TSN. But sports isn't the only draw. dust before the fair opened, Linda and Brett Hodgins had dropped about $2,400 for a conventional, three-metre dish for their home east of Renfrew. Instantly they went from receiving two English channels—Ottawa's CBC and CTV outlets—to over 130. The range is bewildering and includes RTP Portugal, BBC World Service News, internal U.S. network and Canadian network news feeds. As her son watched Barney zapping down from God-knows-where, Linda said she was already longing for some of the local shows on CJOH, the Ottawa CTV station controlled by the Eaton family.

It's one of the great myths of Canadian broadcasting—one that serves private stations well and one that caught the fancy of the Information Highway Advisory Council—that no one watches Canadian shows. "When Canadian programming is available, people will watch it. But it has to be available," says Manera. The CBC's peak viewing time analysis, like other studies, shows that the audience levels for Canadian content roughly match the amount available. In 1993, 25 per cent of programming on all English stations between 7 and 11 p.m. was Canadian. It captured 24 per cent of the audience.

Boosting the number of Canadian shows is a problem that has plagued Canadian television from the beginning. Thirty-one years ago, the Fowler Committee looked at private broadcasting and produced findings that were echoed this year by the mandate review committee "Their program schedules are unbalanced; they do not provide sufficiently wide variety, and do little to further the development of the Canadian consciousness." The establishment of Canadian content quotas in 1970, the creation of the broadcast fund at Telefilm 13 years later, the establishment of the cable industry's Canadian Program Production Fund three years ago and a variety of tax measures were all hailed at their introductions as major steps to reversing the trend.

Most recently, an expanded range of cable specialty channels has been billed as Canadian broadcasting's salvation. Without exception, all the applicants for new channels have claimed that their services will be part of a new beginning for Canadian broadcasting. So far, there's not much evidence of that. "l am a sceptic about the specialty channels," says Herrndorf. "It's a nice thing to have. I happen to be a baseball fan, so I take full advantage of TSN. I like some of the things Bravo! does. But in many ways it's kind of a luxury. Given the economics of the specialty services, it is almost guaranteed that the level of complex original production they do will be minimal."

Sure enough, despite the specialty channels' bold promises to the CRTC, their production records have largely been disappointing. There are some exceptions, including YTV, Discovery and Bravo! to a certain extent. Most of the time, however, reruns and whatever's available at overseas program-buying shows are what specialty channels offer viewers. Reruns aren't necessarily a bad thing if they're Canadian programs. A second or third run is often what's needed to turn a profit. But reruns certainly don't add to the pool of Canadian programming. Programming that does get commissioned by specialty channels tends, on the whole, to be low end, what Herrndorf calls "pocket television". To a great extent, the whole specialty system has become a drain, drawing away ad dollars from over-the-air channels while making a minimal contribution to production.

The CRTC's answer to all this: a call for applications for even more specialty channel licences. Hearings begin this month, and the contenders, if anything, look less promising than the current bunch. They include The Horse Network "All Horses, All The Time."

Despite the less-than-inspiring history of the Canadian content crusade, there are a couple of approaches that still haven't been seriously explored. Neither particularly costs government money, which should be good news for the deficit obsessed federal Liberals. Both, however, demand strong political will from Heritage Minister Sheila Copps and Industry Minister John Manley.

Politicians generally aren't keen to take a hard stand with private broadcasters. Most broadcast licence holders have strong political ties. Asper, for example, is a former provincial Liberal leader. On top of that, the industry has been adept at creating phoney crises whenever it appears its cosy relationship is in jeopardy. Don't he surprised, for example, if you soon hear private broadcasters talking about their need for higher profits and less regulation because of the corporate takeovers sweeping American broadcasting and telecommunications following the near total deregulation of that market in January.

The most important issue for Copps has to be the CRTC and its eight empty chairs. Her closed-door review of the commission indicates that the government isn't happy with the state of the CRTC. Where that's headed is something of a mystery. Manley has talked ominously about making the agency better fit the Liberal Party's values — whatever they may be—and mused about the limited need for regulation in the future. Copps, on the other hand, continues to defend both the need for a CRTC and the importance of broadcasting as a tool for Canadian cultural objectives.

The dismal record of private TV isn't entirely the commission's fault, although the CRTC is obviously part of the problem. Much of the problem lies with the commissioners. That doesn't mean they're dupes of private broadcasters or a gang of fools. For the most part, commissioners are well meaning and work hard for their generous pay. The CRTC's caseload is exploding but hasn't been matched by a corresponding increase in resources. Hearings are seemingly endless, and it's a rare week when at least one commissioner doesn't nod off during some droning presentation.

Offsetting the commissioners' good intentions is their traditional background. With rare exceptions, they tend to be former broadcast or communications managers, journalists or politically connected lawyers, engineers or academics. Certainly those skills can be useful. But others with equally large stakes in broadcasting and communications—artists, consumer advocates, film directors, novelists, actors, musicians— have been conspicuously absent. "I don't know if I'd go so far as to say the CRTC doesn't work very well, but it really needs balance," says Sandy Crawley, president of the broadcast performers' union ACTRA. "The commissioners don't really take our needs into consideration the same way that they do the money people, who can afford to have lawyers, bring them big briefs, take them out to lunch all the time and constantly lobby to get their people appointed to the commission." (Crawley has applied for an appointment but isn't optimistic about his chances.)

This pattern of past appointments has created commissions that try to squeeze the objectives of the Broadcasting act, such as Canadian content, around the broadcast industry's corporate needs and desires. For most of the commissioners, the corporate world is where their ultimate sympathies lie. It won't be easy shifting that. One or two daring appointments, even in the Chairman's job, aren't likely to be enough if recent U.S. experience is an indication. Spicer's equivalent, FCC chairman Reed Hundt, is a former anti-trust lawyer who came to the job just over two years ago with hopes of improving children's programming and maintaining telecommunications access for the poor. Since then he's spent much of his time arguing unsuccessfully with most of his commissioners over such measures as requiring the world's biggest broadcasters to show three hours of educational kids' shows a week. Last fall, The New York Times said Hundt is "looking more and more the head of a dysfunctional family".

A balanced CRTC could be tougher on programming requirements. Other bodies internationally certainly aren't afraid to push the issue. CanWest was the top bidder, in terms at least, for the right to create a new fifth national network Britain. But the U.K.'s Independent Television Commission went for a much lower bid after it found fault with CanWest's programming plans, especially its high level of reruns.

But to really effect change in Canada, Copps and whoever succeeds her must take a hard public stand push private broadcasters to do inspire real Canadian drama. They could require real programming targets and budgets and make it clear private broadcasters that keeping licence will require a dramatic change in attitude. Obviously, it won't be easy. Even small steps by the commission in the past have produced major propaganda assaults from private broadcasting. But if they now have the courage, Asper's national network quest certainly Overrides an opening for such a brave move. Australia shows such a step can be effective. While Australia isn't next door to the U.S., its private networks have long been key sales targets of American program producers. The result was a domestic broadcasting system with programming that would be familiar to most Canadian viewers. Following government pressure, however, the three Australian networks—including one controlled by Can West—all agreed to produce at least 100 hours of original, prime-time drama a year. In turn, they've been allowed to boost the amount of American programming they show in other programming areas and time slots. (The CRTC has a small measure along these lines, allowing a 150 per cent time credit for some Canadian dramas.) "I've heard very few complaints from the Australian private sector about that," says Herrndorf. "They seem to have come to the conclusion that both for identity reasons, prestige reasons and ultimately for profit this was a good deal for them."

Will Copps take such a step? Historically, she's never been shy about speaking her mind, and the need for renewing the Canadian identity has never been greater. But the degree of the Cabinet's commitment to cultural issues is unclear. Much of the confidence instilled in Canadian cultural advocates by Copps's Cabinet appointment and the Cabinet's subsequent rejection of Borders Bookstores' plans for the Canadian market by Investment Canada faded in March when the budget further fuelled the CBC's funding crisis. Copps's main response, so far, has been only promises that some kind of completely new funding plan, completely undefined though apparently not the tax proposed by mandate review, will eventually appear. Manley also has considerable say in the CRTC's direction. Not surprisingly, however, as Industry Minister he tends to view broadcasting as a business rather than a cultural force.

Whether or not the government moves, a number of developments suggest that broadcasters should themselves start rethinking their view of Canadian content out of self interest. While it's unlikely that we'll ever have 500 channels to choose from, it's not unreasonable to expect that 100 might be around by the end of the decade, thus diluting current broadcasters' market share. Similarly, there are growing threats from abroad that could upset the current system, threats that can't be solved by more special deals from the CRTC or government. Entertainment is the second biggest U.S. export after aircraft. Mired in the U.S. administration's support for Nashville-based Country Music Television's ludicrous argument that it has a guaranteed spot on Canadian cable was a message that Washington doesn't regard commercial broadcasting as a cultural industry exempt from trade action. More recently, the Clinton administration's hard-line attack on federal legislation blocking Sports Illustrated's "Canadian" edition confirmed its attitude. Signal substitution may be Washington's next target.

Whatever happens in the future, the best long-term hope for Canadian private broadcasters is developing a distinct identity rather than just acting as American programming packagers. Their attempts so far have been exceptionally superficial. When John Cassaday left Campbell Soup early this decade to run CTV, he immediately began talking about developing a brand identity. There's not been much to show for it beyond a proliferation of on-screen network logos. By contrast, high-quality drama made for and by Canadians can allow Canada's private networks to stand out from the growing crowd. What's more; good, overtly Canadian shows have shown their export sales potential in the past—even if they don't have Charles Bronson. It's time for Izzy to substantially rethink his dream. Asper may not care about his role in Canada's cultural future, but his own financial future may depend on developing it.

lan Austen is a freelance journalist based in Ottawa.