To the Standing Senate Committee on Transport and Communications
Ottawa, Ontario
March 5, 2014
Check against delivery
Thank you, Mr. Chair.
We appreciate this opportunity to offer the CRTC’s perspective on the opportunities and challenges facing the Canadian Broadcasting Corporation (CBC) and Societé Radio-Canada (SRC) in a fast-changing communications environment. With me today is Peter Foster, Director General of Television Policy and Applications.
As the national public broadcaster, CBC/Radio-Canada must meet the objectives of the Broadcasting Act to properly serve all Canadians. This means offering a wide and diverse range of programming that informs and entertains in both official languages.
You are also likely aware that the Commission recently examined the impacts of technological change on its ability to satisfy these objectives. This was part of our comprehensive review of CBC/Radio-Canada’s licences for its English- and French-language radio and television services last May.
Our decision to renew the licences was influenced by a number of factors, including the thoughtful interventions of the more than 8,000 Canadians who expressed their interest in the future of CBC/Radio-Canada. It also reflects our confidence in their long-term plans.
As CRTC Chairman Jean-Pierre Blais said when announcing our decision, the renewal of CBC/Radio-Canada’s licences signals our belief that:
This assessment was based, in part, on the Corporation’s five-year plan, “Strategy 2015: Everyone, Every way.”
In addition to conventional broadcasting using traditional media, the plan emphasizes CBC/SRC’s commitment to having a strong presence on digital platforms—the way of the future.
With continuing innovations planned through to end of its new licence term in 2018, this should ensure that Canadians will have access to leading-edge digital content from their national public broadcaster. Equally important, it should help to secure the viability of the Corporation’s operations.
This approach recognizes that Canadians today want access to their favourite programs anywhere, anytime and on the device of their choice. It also confirms CBC/Radio-Canada’s understanding of just how dramatically the broadcasting and communications landscape is changing.
Of course, Canadians are still watching conventional television. TV takes up more of our time than almost anything we do aside from work and sleep—about 28 hours per week, on average.
But there is no denying that technological innovation is redefining the very definition of “broadcasting.” Canadians are plugged in 24/7 in ways that few people could have imagined even a few years ago. This has irreversibly altered the TV landscape.
CBC/Radio-Canada’s coverage of the Sochi 2014 Olympic Winter Games reflected this evolving reality. It worked in partnership with other broadcasters to provide Canadians with extensive coverage on television, the Internet and mobile devices.
While Canadians still have access to over 700 traditional channels, TV is now offered on different media—as Internet-based offerings like Netflix, Tou.tv, YouTube and Apple TV attest.
According to the CRTC’s 2013 Communications Monitoring Report, a third of Canadians watch over three hours of Internet television per week. That’s an increase from 2.8 hours in 2011. And 4% report only watching programs online.
A further six percent 6% of Canadians watch television programming on a tablet or smartphone.
The report also found that revenues for Canadian television services reached $6.5 billion in 2012. That’s a 1.9% increase from the previous year.
Another notable trend: the percentage of Canadians subscribing to Netflix grew from 10% in 2011 to 17% in 2012.
The CRTC has been monitoring trends like Internet television, trying to determine the implications of these innovations for Canada’s telecommunications and media industries.
After an initial review in 1999, we exempted digital programming services from our regulation. A second review in 2009 confirmed that this was the right approach.
The CRTC does not intervene into the commercial arena unless absolutely necessary to achieve the objectives of the Broadcasting Act. We allow market forces to drive change and only intervene when the market is unable to achieve the policy objectives set out in the Act.
While some might like to turn back the clock, the reality is that broadcasting as we once knew it is no longer—and will never again be—the same. Just as Canadians’ viewing patterns are changing, the system needs to evolve.
That’s not necessarily a bad thing. Rather than seeing companies like Netflix and YouTube as a threat, they should be looked at from the standpoint of the new opportunities they present.
We should be leveraging them to promote Canada’s creative advantage in the global arena. Because information and communication technologies now drive industry and create business opportunity.
Certainly, this is how CBC/Radio-Canada seems to view the situation.
A few of the SRC’s French-language TV shows—such as Les Invincibles, Les Parents and La Galère—can be viewed on Netflix. This is in addition to the large library of titles available through its Tou.tv website.
The CBC recently extended and expanded its licensing agreement with Netflix for its English-language TV shows. The agreement will see new seasons of shows added to Netflix, such as Republic of Doyle, Heartland, Mr. D, Dragons’ Den and other titles. As well, the deal adds its popular Murdoch Mysteries series to the service for the first time.
This agreement reflects CBC/Radio-Canada’s—and Canadian content creators generally—proven ability to make quality programming which appeals to audiences both here at home, and around the world.
Last October, the CRTC launched a national conversation with Canadians about this new age of television in an undertaking called Let’s Talk TV: A Conversation with Canadians. We have purposely sought out Canadians’ opinions before moving to formal public proceedings.
We want to put Canadians at the centre of their television system. So we need to hear directly from them about their needs as engaged citizens, as consumers that make informed choices about programming, and as creators of television content.
More than 3,100 Canadians took up our invitation to express their views on the future of their television system during the first phase of the consultation.
Many Canadians told us that they want more choice and control over the programming they watch and pay for.
So I don’t think we should expect to see a change in the trends I’ve already outlined when it comes to Canadians’ viewing habits.
The Commission is continuing this conversation with Canadians. Last month, we released the Let’s Talk TV Choicebook, created using the comments received in Phase 1.
In this second phase, we are asking Canadians to weigh the different outcomes that certain changes to the television system could bring about and to think about what is important to them. We are asking them to look beyond individual interests to the bigger picture and what this means for their television system.
Because individual preferences, multiplied by the actions and choices of other Canadians, are not without consequences. The demands of one group may have a detrimental impact on the choices of others.
This spring, we will launch a formal proceeding that will include a public hearing in September 2014. Our objective is to develop a framework for the television system that is responsive to the needs and expectations of all Canadians.
I would be pleased to answer your questions regarding these initiatives or any other aspect of my presentation that you may have.
- 30 -