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The CBC’s conundrum: Change isn’t easy, but the public broadcaster needs to try by Scott Stinson

Dec 9, 2011

Source: National Post

Adam Beach, the star of the upcoming CBC series Arctic Air, spoke about his show recently as the network launched its winter schedule. It was not a typical endorsement.

“What Canada needs is a show that speaks volumes about what it is to be Canadian,” said Beach, the Manitoba-born actor who has appeared in Hollywood films such as Flags of Our Fathers.

“[Arctic Air] brings the inheritance of the landscape, the connection to the Dene language and people, but it also incorporates a community and an enterprise that integrates the multicultural diversity of Canadian-ness.”

Beach sat back and smiled. “Whoa, that was pretty good.” He looked at his interviewer’s notepad. “I should write that down.”

It was just an impromptu comment, but Beach had unwittingly underscored the key point in the debate about the importance of Canada’s public broadcaster.

Can the CBC simply try to make interesting programming? Or does it have to aim for programming that is both good and yet noble, as with Beach’s lofty description of Arctic Air? If it’s the former, does it need a billion-dollar subsidy from taxpayers? And if it’s the latter, does it actually need more than that?

These questions, which have been around pretty much since the Canadian Broadcasting Corporation was created in 1936, are newly relevant as the federal Conservatives, long thought to be harbouring CBC-gutting tendencies, have said the Crown corporation will be expected to reduce its budget as Ottawa embarks on broad spending reductions. One lobby group has launched a campaign for the removal of the public subsidy, while another has demanded that the CBC’s current funding be protected. The public broadcaster has engaged in a visible spat with rival broadcaster Quebecor about everything from accusations of liberal bias to the disclosure of Peter Mansbridge’s salary.

The sabre-rattling seems unlikely to abate so long as the CBC retains its hybrid funding model, in which it raises about a third of its cash from advertising sales and other measures and receives the rest via what is called a parliamentary appropriation. The system requires the CBC to pursue advertising dollars with ratings-driven programs such as Hockey Night in Canada and Battle of the Blades while at the same time delivering low-uptake offerings such as classical radio that are part of its public-service mandate. For the CBC, this is often a lose-lose. Those who believe in the inherent goodness of a public broadcaster are nevertheless annoyed that it airs figure-skating reality shows and those who have no interest in the fate of the otter are chagrined that they are paying for The Nature of Things.

The model is tricky, yet the CBC appears to have no interest in changing it. But in resisting reform, the CBC’s strategy seems likely to let the Conservatives begin a slow bleed.

The latest indication of the CBC’s commitment to the status quo is a study released last week titled “Why Advertising on CBC/Radio-Canada is Good Public Policy.” The study, commissioned by the public broadcaster and conducted by Nordicity Group, examined what would happen if the CBC were to forego advertising revenue, as is the case with the BBC in the U.K. and PBS in the United States. The paper’s assessment of an ad-free CBC was bleak: a negative financial impact of more than $530-million.

“The impact would be devastating,” Nordicity warned. It went so far as to forecast a loss of $150-million worth of production in the Canadian television industry, and a “net loss of GDP” of $165-million, “which translates to 3,600 job losses.”

“There is no good public policy reason to eliminate or seriously reduce advertising on the TV services of the CBC,” the study concluded.

That it would reach that conclusion, though, is not the least bit surprising since it was asked to consider a doomsday scenario that is tremendously unlikely: the elimination of advertising on the CBC [ital] with no attempt to compensate for lost revenues. [ital] If the Canadian government were to strip the CBC of its right to sell TV ads, Ottawa would have options to help it make up at least a significant chuck of the revenue shortfall. In Britain, the BBC is funded primarily by licence fees that households pay in order to receive a television signal. In Australia, the public broadcaster receives almost all of its revenue from taxpayers. In some other Western countries, private broadcasters pay a tax to the public broadcaster since they don’t have to compete with it for advertising.

The Nordicity study considered none of those options; it wasn’t asked to do so. “We didn’t get into how the CBC would respond,” as senior partner Peter Lyman put it in a conference call with reporters last week.

On that same call, CBC president and chief executive Hubert Lacroix was asked why the broadcaster commissioned the study. Did it have any indication that such a change was in the offing?

“This is not being discussed,” in government, he said. “I’ve had no conversations to that effect.”

But, he said, talk of an ad-free CBC TV is raised from time to time, and “I think it’s important that as this is being discussed and raised by, perhaps, other broadcasters, it’s important that the discussion is grounded in fact.”

It was a none-too-subtle shot at the CBC’s most vocal of critics, Quebecor Inc., which, since it launched Sun News Network in April, has targeted the CBC for it what it sees as its profligate use of taxpayer money, among many other beefs with the network.

“This is not about engaging Sun Media,” Mr. Lacroix would say, allowing only that “this is about ensuring they have the facts.”

Sun Media, though, is plenty engaged. It has filed access-to-information requests for everything from the amount of the money spent on CBC events to the salaries of its most high-profile employees. (Parliamentary officers have agreed that the CBC refuses far too many freedom-of-information requests.) Sun News has alleged liberal bias at every turn and focused a considerable amount of its own news programming on criticism of the CBC. The CBC has responded by accusing Quebecor of hypocrisy in its stance since it, like all private broadcasters, is also the beneficiary of various government-funded initiatives. Mr. Lacroix last week referred to the “false dichotomy” touted by CBC critics in which only the public broadcaster receives public money. But while it is true that Canadian programming on private networks is subsidized by Ottawa through initiatives like the Canada Media Fund, the CBC also has access to those same programs — and is still the only broadcaster to receive a direct stipend from Parliament. It might not be the dichotomy as described by all of the CBC’s antagonists, but a dichotomy certainly exists.

While Sun News has focused its ire on the CBC’s public funding, the CBC is not without ardent supporters. Watchdog group Friends of Canadian Broadcasting launched a “Stop the CBC Smackdown” campaign with satirical videos in which the CBC is purchased by a U.S. wrestling promoter. It also released a poll it sponsored that said a healthy majority of Canadians want to see the broadcaster’s current level of funding maintained or increased.

“We’ve been doing that kind of thing for years,” spokesman Ian Morrison said in an interview, “and if I were to summarize it in a sentence, it’s that about 80% of Canadians really like public broadcasting.”

Mr. Morrison said that although the federal Conservatives have continued to increase the dollar amount of the CBC’s funding since coming into power, the broadcaster’s funding has declined, in constant dollars, under successive governments. And he argues that, compared to the rise in total program spending, the CBC “has been starved of funds.” On this he has a point: total federal program spending has jumped more than 25% over five years, while the CBC’s appropriation has remained relatively flat.

Mr. Morrison’s group wants the CBC to be preserved as is, with more public money if possible, although it does not think highly of current management. And Friends of Canadian Broadcasting eschews the idea of a revamp via an altered funding model, saying such prospects — switching to the fully public BBC system, for example — are “straw man discussions” since the impacts would be so significant. An ad-free CBC would have to fill all the air-time currently filled by ads with something else that would cost a lot of money. The Noridicity study said the CBC would have to spend almost $200-million just to fill its dead air. “In the real world, that’s just not on,” Mr. Morrison says.

But such options should at least be on the table. An ad-free CBC would be able to focus on television that serves its public-service mandate and not chase dollars with programming that private broadcasters are anxious to provide. On the other end of the spectrum, a subscription-based CBC, freed somewhat from its public-service mandate, could provide the quality Canadian shows that it insists Canadians want to see.

The CBC, though, seems keen to avoid such discussion in favour of protecting what it has. Last week’s Nordicity study came a few months after the broadcaster released a study it commissioned on the CBC’s economic value. The Deloitte & Touche report stated that the CBC added $3.7-billion to the economy. It further argued that removing the public subsidy from the broadcaster would effectively cost the Canadian economy $1.3-billion due to spin-off benefits such as homemade television production. The conclusion was almost laughably simple: there is no better government investment than in the CBC. Coupled with the new study, it becomes pretty clear that the broadcaster is erecting sandbags around the status quo.

Unsourced reports have said CBC bosses have been told to expect a cut of 10% in the next fiscal year. (In response to interview requests for this article, both Mr. Lacroix and Heritage Minister James Moore said, through their offices, that they were unavailable.) And if that cut takes place, which would amount to a CBC with about $100-million less to spend, it will bring tough decisions for the corporation. And no further guarantees for its future.

Major changes wouldn’t necessarily be easy for the CBC. But given the forces aligned against it, it might regret not angling for them.

© National Post