Source : Globe & Mail

With the nation's role on the airwaves facing its first rewrite, all the players are tense. Subplot: get Global.

by Doug Saunders

To understand the strange circus that will roll into Hull this morning, it helps to remember Barney Panofsky, the dissolute TV producer in Mordecai Richler's novel Barney's Version, who spent his days churning out "Canadian-content TV series sufficiently schlocky to be syndicated in the U.S." Sound familiar?

Whenever Mr. Panofsky's franchise was threatened by changes to Canadian-content rules, he would become an instant patriot, fly to Ottawa and defend the subsidies and protections he received: "I did a quick change in the hypocrite's phone booth, slipping into my Captain Canada mode, and appeared before the committee. 'We are defining Canada to Canadians,' I told them."

For the next three weeks, a great mob will gather each day outside a concrete office building in Hull, don business clothes and cherubic faces, and prepare to step before the microphone.

For the first time since it was created 28 years ago, the complex system of regulations that govern Canadian content on TV screens is up for a complete review and overhaul, and rarely has a federal policy been the subject of such intense scrutiny and debate.

Although the arguments will be lengthy and complex and the rhetoric often overheated, at their heart is a deceptively simple question: How do we make and pay for Canadian TV shows?

That question has been controversial since it was first asked by the Canadian Radio-television and Telecommunications Commission in 1970 in a series of hearings that bear an uncanny resemblance to this month's events, both in the intensity of the emotions involved and the potential impact on the television we see each night.

In fact, 1998 may be remembered as Year Zero for Canadian TV: By year's end, both the CTV and Global networks will have become powerful national entities, the CBC will be nearly all- Canadian in content for the first time in its history, and Alliance Atlantis will be one of the world's larger TV-production companies.

Even though the entire Canadian TV system could not exist without a system of licences and subsidies, that system is now strained to the breaking point.

If the world of TV is changing fast, its politics have become dirtier and more complex. The old tension between broadcasters and regulators has spread to new businesses that didn't even exist in 1970, and developed some intriguing new elements:

Lobbyist versus lobbyist: Two weeks ago, several journalists received phone calls from an Ottawa researcher and freelance journalist.

She was seeking negative information about Ian Morrison, the head of Friends of Canadian Broadcasting, the viewers' lobby group calling for increased spending by broadcasters on Canadian- content programs.

Were there any stories going around about Mr. Morrison's relationship with his wife, say, or about his organization's finances? After some prodding, she told two reporters that she had been hired by the Canadian Association of Broadcasters, the main lobby group for private TV stations. The CAB was looking for stories that might deflate Mr. Morrison's credibility before the hearings.

Asked about the researcher's quest last week, CAB president Michael McCabe denied having heard of her. "She has not been contracted by us, we are not interested in Friends," he said.

Network versus network: Last week, an extraordinary shift in alliances took place. CTV, the country's oldest private network, decided it would not argue alongside Mr. McCabe and the rest of its industry at the hearings.

After a closed-door meeting with top TV-production lobbyists, CTV president Ivan Fecan quietly let it be known that he would side with the producers in arguing that Canadian-content quotas should become more arduous, not less. While CTV has not formally abandoned the CAB, it appears to have rejected the group's key positions.

The move appears to be aimed directly at CanWest Global Communications Corp., Canada's other national private network, which is strongly allied with the CAB. Because Global only recently became a national force (by acquiring the Alberta assets of WIC Western International Communications Ltd.), it has faced far lighter CRTC licence obligations, even though it is a far more profitable company. CTV has faced far higher Canadian-content quotas than any other private network since merging the assets of its member corporations into one entity last year.

Instead of arguing that its quotas should be reduced, though, CTV is taking the unusual tack of arguing that Global and the other private networks should raise their Canadian-content commitments at least to CTV's level.

In less than a year, the relationship between CTV and Global executives has descended from co-operation into acrimony. "CTV is on a very personal mission ... they must be driven by debt, or something like that," Global president Jim Sward said this week.

"I think that what they're trying to do in this hearing is they're saying, 'We want the commission to bring everybody up to our level of mistakes.' ... I don't understand how it works."

Many industry observers have long referred to these as the "gang-up-on-Global hearings," and the CTV-producer alliance is unlikely to make Mr. Sward and his colleagues any more comfortable.

Producer versus broadcaster: In the past, Canadian-content commitments have been seen as an obligation: If you're granted a broadcast licence, which gives you casino-like profits from carrying U.S. shows, you must channel some of those profits into making Canadian programs.

This year, the private networks (including CTV) have developed a new angle: They now want the ability to make a profit, not just from their entire operations, but from each of the Canadian shows they produce. They will argue that they should have the right to own the government-subsidized programs they show and to sell those programs internationally. The rights are currently held by the production companies, and networks have not been allowed to produce their own shows using taxpayers' money.

Needless to say, this stance faces fierce opposition from the production companies, which fear they would be driven out of business.

Despite its new-found maturity and complexity, Canada's TV industry still faces Barney Panofsky's problem: As virtuous as Canadian programs may appear, the potential for profit still lies south of the border.

For broadcasters, it is far more remunerative to purchase and replay successful U.S. shows, which can be had for as little as $50,000 an hour, rather than Canadian programs, which cost three or four times as much, even if they flop. For producers, it is more rewarding to create low-rent U.S. action shows than high-quality Canadian dramas.

"There has been a great privilege in owning broadcast licences, and that privilege is in exchange for supporting the Canadian broadcast sector," said Elizabeth McDonald of the Canadian Film and Television Production Association, which is to make its arguments to the CRTC this morning.

"There are very few other businesses where, if a competitor wants to come into the market, they have to convince the regulator to let them in, so there's a lot of money to be made here .... What we're asking for is that some of that money be returned to Canadians."

In the view of Ms. McDonald and many other TV-industry figures, not a minute of Canadian TV (except sports and news) would have been created without the CRTC and federal subsidies. When a nationalistic Liberal government created the commission 30 years ago, almost everything broadcast during the evening hours was American in origin, but for news, hockey and a few low-budget game shows.

The 1970 Canadian-content hearings were a crusade, with such venerable figures as Pierre Berton delivering long speeches on the Yankee takeover of Canadian culture. The newborn CRTC's aims were forceful: 60 per cent of all TV on Canadian stations should be domestic, and a good part of it during prime-time hours.

Broadcasters were furious. CTV president Murray Chercover argued that the new regulations would put his network out of business, turning its $4-million profit into a $9-million loss (in fact, its profits increased continually for 20 years after that).

The CAB launched into a seven-hour filibuster that included loud arguments against the very principle of regulation and a nasty personal attack against a Toronto Star reporter whose articles took a viewers-rights point of view.

Late that evening, the CAB president was visited by John Bassett, the Toronto businessman who owned CTV's largest member station, and Stuart Griffiths, who owned a major Ottawa station. Disgusted by their lobby group's position, they both pulled their stations out.

"The brief made it seem the CAB was totally opposed to the objective of the CRTC, which is distinctly Canadian programming," Mr. Bassett told The Globe and Mail. "I've spent over $5-million to try to achieve that objective." CTV later fought the regulations, even taking the CRTC to the Supreme Court in 1980 (and losing), but Mr. Bassett's 1970 decision foreshadowed the current showdown with Global.

Today, the emotions and battles are much the same, but the future looks rather different: Almost one-third of the TV Canadians watch is on cable stations, not on networks; the rebroadcast of U.S. programs here may not be as lucrative in the near future; the industry is increasingly controlled by the people who create the programs, not those who broadcast or distribute them.

A small panel of CRTC commissioners, most of them either former Liberal fund raisers or former TV-industry figures, will sit at the head of a small hearing room and watch all this unfold. "The pressures are enormous, to hear 300 briefs and get a handle on the issues," said Andrew Cardozo, the lone member without an industry background.

In the months ahead, as the commissioners try to transform all those arguments into a way to create watchable Canadian TV, the pressures are sure to intensify even further.

© Globe Information Services