Source: Winnipeg Free Press

Let's see if this is right. Let's assume that the federal government's plan to liberalize foreign investment in the telecommunications industry comes to pass. Then, conceivably, the American cable company Comcast could purchase the Canadian cable company Shaw Communications and, providing that Shaw's attempts to buy Winnipeg-based Canwest go ahead, Comcast could end up owning Canada's second-largest television company.

This, roughly, is the fear that the federal NDP has about the Tories' suggestion that the telecommunications sector be opened to foreign investment: Potentially it puts the longtime protection of Canadian popular cultural institutions on the block.

Suddenly, the prospect that Canadian content is up for grabs is back in the news. For at least the last decade pundits have been predicting that, in television, the regulatory borders between the United States and Canada would come down. What has kept them firmly in place is not so much regulation as the protection of intellectual property rights. The forces pushing to dissolve boundaries are well known. The Internet, in theory, knows no boundaries. Anyone under the age of 30 knows how to get around restrictions that prevent the watching of American shows, but for all of that, the restrictions have remained remarkably solid.

That's because the owners of the rights to television shows, producers and broadcasters, make their money by selling rights in individual territories around the world. Selling rights to shows in Canada is a very lucrative business. As a result, American networks have gone to great lengths to make sure that Canadian viewers only have Internet access to the likes of The Mentalist, The Good Wife and Lost from the sites of the Canadian broadcasters to whom they have sold these shows.

The process is called "geo-blocking". Geo-blocking, however, becomes unnecessary if the American and Canadian broadcasters are owned by the same company.

The scenario may be unlikely, but it is surely possible. Comcast, the American cable company, has already agreed to buy NBC/Universal. If Comcast were to buy Shaw, then Shaw, Canwest, NBC and the film studio Universal all become part of the same mega-entertainment Goliath.

This kind of cross-border company is the logical extension of the Tories' admittedly tentative plans to open up the telecommunications borders.

Of course, it is likely, given the long-standing loud opposition to such cultural changes, that any telecommunications liberalization will be heavily hedged with protection for Canadian culture. But there is no doubt that the government is not so concerned about cultural protection as the NDP or the Liberals.

There are other straws in the wind. Amazon, the blockbuster Internet bookseller, wants to set up a warehouse in Canada to help it distribute its titles here. Canadian booksellers see this as the thin end of the wedge. The government is considering it. If they allow Amazon to proceed, then to institute a fair playing field the Tories may need to lift the restrictions on foreign investment in Canadian booksellers. Heather Reisman, who controls Indigo and Chapters, originally planned to set up a big-box book-selling business with the American company Borders but was prevented from doing so by Canadian cultural protection laws. If Amazon can have a physical presence here, then shouldn't Indigo be able to have American investment?

Are these possibilities a bad thing? Maybe, but maybe not. Amazon is arguing strenuously that since it set up Amazon.ca it has been a friend of Canadian authors and publishers. Would American ownership of Canadian television be friendly to Canadian shows or shut them out?

If you look at the example of film, then American control of Canadian airwaves would be extremely detrimental to Canadian content. American film has long dominated Canadian theatres outside of Quebec and American distributors still control a significant part of Canadian distribution.

But American shows also dominate Canadian television despite Canadian ownership of Canadian networks. What exactly would change if the system were opened to foreign ownership? Would Canadian production disappear or rather, would it have easier and faster access to a bigger market with more financial resources?

In Canadian television circles, it is almost a heresy to suggest that any further American intrusion into Canadian airwaves could possibly do any kind of good.

But Canadian broadcasters are in trouble. Canwest is in bankruptcy protection. CTV had to rearrange its debt covenants. Rogers-owned City has killed some of its signature newscasts. After years of public clamouring, the pay companies have at long last established Canadian versions of the much-loved American HBO.

The Tories seem prepared to take a new look at old assumptions about what is good for Canadian culture. The idea of foreign ownership of our popular cultural institutions may be scary, but given the massive changes going on in the telecommunications and broadcast sectors, it may well be worth facing the scariness head-on and asking whether cultural protection works best without foreign investment or with it.

Nicholas Hirst is CEO of Winnipeg-based television and film producer Original Pictures Inc.

© Winnipeg Free Press