TORONTO – Can cord cutting in Canada be halted, or at least slowed, by solving the country’s “drama problem”?
Veteran lawyer and engineer Peter Miller and Ken Engelhart, former SVP regulatory and chief privacy officer of Rogers Communications, think so. Speaking Wednesday at the CTAM Canada Leadership Forum in Toronto, the duo drove home some key points from their recent report Strengthening Canadian Television Content: Creation, Discovery and Export in a Digital World, penned with Lawson Hunter for the C.D Howe Institute.
The “drama problem”, according to Engelhart, is the dearth of big budget, well-produced, made-in-Canada dramas that would conceivably keep Canadian eyeballs from straying to foreign online providers, and could also be profitably exported to international markets like the U.S.
“Saying that you have a great TV system and you have a drama problem is like saying you’ve got a great steak house but the steaks aren’t very tasty. This is a problem,” he quipped.
While Canadians eat up their homegrown sports and news, some 40% of prime time viewing is dramas, Engelhart added. And in English Canada, that means a steady diet of big Hollywood shows that have either been picked up by Canadian broadcasters or are being served by the likes of foreign OTT providers like Netflix.
Canadian dramas just don’t do well here at home, he said, but it is not for lack of infrastructure or talent, both of which Canada has in abundance.
"We have a regulatory system which is not designed to create great programming and great drama." – Ken Engelhart
“I think the problem is the regulatory system”, Engelhart continued. “We have a regulatory system which is not designed to create great programming and great drama. It incents the production of a lot of low budget TV, it doesn’t encourage export, and (requires that) a lot of the drama must be made by independent producers (rather than the broadcasters)… But the budget does matter. Big budget shows do better than low budget shows and in Canada we’re creating too much low budget stuff.”
The CRTC’s decision to drop the requirement that over-the-air channels air Canadian content outside prime time, meaning broadcasters may spend more on top programming during prime time, is “a good first step” but more is needed, he continued. CRTC and Canada Media Fund rules which have the effect of limiting the export of Canadian shows must be changed, too, he added.
Canadian broadcasters also need more “skin in the game”, meaning that they should absorb the risk of funding and producing high quality dramas and in turn retain and exploit all rights, a move that would also decrease their reliance on slick U.S. fare.
But BDUs, too, need to start thinking of how stronger Canadian content could offer them a competitive advantage in the battle against non-Canadian OTT players, added Miller.
Miller described Bell Media’s recent decision to acquire a majority stake in Pinewood Toronto Studios as interesting, emphasizing the broadcaster's choice to invest in infrastructure “out of the whole value chain.”
“One of the things we do in Canada is we worry about people using their leverage and we have these vertically integrated players that are not allowed by regulation to use their leverage," he added.
“I think what we’re trying to say is ‘we’re up against global behemoths – how can we stop Bell Media from using its leverage across the value chain when we’re fighting Netflix?’ We’re not suggesting there are simple answers, we’re suggesting that we need to look at this because we’re tying hands behind our back while we’re being beaten up by players that have 10 times the resources that we do.”
