OTTAWA – Once upon a time, the boys and girls in the content production and delivery business gathered for many huddles. They were figuring out how to pass film and video content to the receiver, the Internet, and score a business model for web content. The play action took the form of rights management issues, and the strategy was nearly intercepted by haggling over the ownership and dollar value of rights.
Today, as the Internet joins video MP3 players, cellphones, games and podcasting among the receivers of digital content, the players are huddling once again and again, the quarterbacks of content have no open receiver, no business model in sight. The end zone is fogged in and the play action is complicated by cost concerns around the HD video format.
The Canadian Film and Television Production Association’s (CFTPA) Prime Time in Ottawa event, Feb. 15-17, was the first big huddle focused consistently on questions raised by the proliferation of new digital platforms.
CRTC chairman Charles Dalfen, noting a decision on mobile broadcasting is coming soon, foreshadowed the discussion in his opening keynote. “Broadcasters will face the challenge of increasingly fragmented markets. Content providers will have to tailor their product to…multiple platforms while navigating uncharted territory related to broadcasting rights. Audiences will become increasingly fickle, as viewing options proliferate….
“This change is for the good – it’s going to give television audiences an unprecedented level of choice….And it’s going to present Canadian production companies with new markets for their work….We see that a major shift is underway in television, but none of us knows what the world is going to look like after the dust settles.”
“The way we sort out these complex rights is the issue of the day,” said Paul Robertson, president of television for Corus Entertainment, on the opening panel. “But we all have to figure out how 12-to-24-year-olds want to see TV, and where and when. If we’re not on that train, we’re under it….We still see rights as five percent or maximum 10 percent of our business.”
Whatever the percentage, the CFTPA’s annual state-of-the-industry report declares, “Producers will be looking to retain a fair share of that action rather than cede future rights as a condition of a sale today.”
“The issues come down to what’s a broadcast right and what’s my right,” added another panelist, producer Alex Raffe. “We also have to share fairly with our creative partners in the unions and guilds….It’s not about broadcasters paying more, but if they take more (rights), I have fewer to take elsewhere to finance our shows.”
These days, she says, production shoots must provide “snippets for this download or that. Maybe two years down the road we’ll know what some of these things are worth and which ones aren’t worth anything.”
On the Content Delivery panel later in the day, filmmaker and podcaster Jeff Macpherson reinforced the point that business models don’t exist. Although he sees podcasting as a filmmaking and distribution revolution, he’s not running it as a conventional business. He’s still contemplating rights and clearance issues.
But audiences can be sizable compared to conventionally distributed content. Macpherson showed a clip, produced in his apartment on a mini budget, from Tiki Bar TV, which, he reckons, has been seen by 250,000 podcast subscribers. “More people have seen this five-minute show,” he said, than Come Together, his 2001 feature film.
Fellow panellist Michael Hennessy, currently overseeing the dissolution of the Canadian Cable Telecommunications Association, commented that, “We’re not cable companies anymore, we’re broadband….We’re in the business of putting together digital rights packages and delivering them to the consumer.”
Consumers of cbc.ca, CBC Radio and TV are heating up digital connections with the pubcaster via 10 million unique visits to its website, podcasts accessed via iTunes, and Newsworld newscasts on cellphones. According to Richard Stursberg, EVP of English TV, CBC had delivered 83 Turin Olympics highlight reels to cellphones as of Feb. 16.
“We are deeply committed to online and mobiles,” he says. “Content is going to be made from the beginning as multiple-platform content.”
But Stursberg says the costs-versus-benefits for digital platform content are not yet clear. “We’re hoping to use television’s ‘big bullhorn’ to push content out and split the revenues and costs 50-50, or revenues net of costs.”
Eric Bourbeau, consumer web director with Telus, says the company launched an IPTV trial in 2005 offering Vancouver Canucks games to high speed subscribers in B.C.’s Lower Mainland. On its Mobility platform, Telus fed VOD content to video-enabled subscribers.
“With mobile TV,” says Bourbeau, “it’s less about duplicating channels and (more about starting to use) mobile television as something for living room consumption.” He says people want content to be easier to find. Therefore, search engines with previews would be good – the idea of using your mobile phone as another interface into the living room TV experience.
But as Hennessy pointed out, the availability of more glamorous content – such as episodes of Lost and Desperate Housewives from ABC – “signals to the community that they’ve reached a point where digital rights management was secure enough that they’d start to release real content online.”
With the Americans forging ahead and Canadians lamenting the lack of Canadian drama on mobiles (“mobisodes”) and iPods, how long can creators and rights holders afford to delay sorting out rights clearances and what exposure on these new platforms is worth?
“Everyone’s going to try to hold all the rights to hit content,” says macpherson. “No one’s been successful so far – there’s not enough hit shows out there….If you don’t put your show out there on the Web, somebody else will.”
The growth in online ad revenues is appealing. Bob Reaume, VP of Policy & Research at the Association of Canadian Advertisers, says spending on online ads grew 43% in 2005 to $520 million and is expected to grow another 30% in 2006. Online spending has now outstripped outdoor and is on pace to exceed spending in all magazines next year. He says spending on TV ads looks stable, at about $3 billion.
Of the US$1.99 consumers pay to receive the Housewives on an iPod, Bourbeau says iTunes gets US$0.50 and the rights holder gets US$1.49, more per viewer than with advertising.
Stursberg wonders if similar arrangements can be used to build Cancon delivery. He expects Americans may be big winners in this marketplace because they have the most money. “They can sell separate Canadian rights to Desperate Housewives to the Canadian licensor, or they can envision a North American rights regime,” which he sees as much harsher competition for Canadians.
“The traditional idea of cable companies or broadcasters is disappearing,” Hennessy told cartt.ca in an interview. “They’re not going to change overnight, but success in the future will (depend) on whether you can…acquire rights-protection tools to guarantee rights to the holder….Now (the industry is) just a bunch of people along a chain moving content boxes along; the technology allows you to shift the number of people in the chain….He who controls (content) is in a big position and he who carries it is strong so it’s important to be a big player (to acquire rights).”
Susan Tolusso is an Ottawa-based freelance writer.
