The Future of Television in Canada
So, news clips may fare better on the web, but live events will still play better on TV.
The report gives some reasons why the industry is far from a state of collapse: people are investing heavily in HD sets, indicating they’re not abandoning TV for internet video any time soon; cable and satellite subscriptions are very high in Canada compared to other countries; while some ad revenue is leaking to the internet, the overall ad-market pie is still growing; and Canadian broadcast companies and producers may be able to themselves earn back some lost revenue by building web properties themselves.
Part of the changes happening are the same as in the US – the growth of internet video, a move towards on-demand viewing, whether over the internet, cable pay-per-view, or iTunes. And the more general spectre of people spending more time online than watching TV, whether they’re on YouTube, Facebook or just emailing. In the US, the broadcasters have already responded by putting their shows on their websites (with ads, natch) and selling them on iTunes. In Canada, that’s not so simple – they must buy the online rights to these programs from the US companies, who are at the moment charging too much for any Canadian broadcaster to want to buy them. And that’s because of the much larger issue here: Canadian channels make their money airing the big US shows, and are forced by law to funnel some of the money they make into Canadian production. So with the growth of internet distribution, they are in a much more precarious situation – no longer the only way to get to the content.
The other Canada-specific issue is the role of government. Our government regulates TV and film to support domestic cultural production; it does not regulate the internet. So if people increasingly go to the internet instead of TV, the government cannot use Canadian content requirements any more.
The report wisely suggests government intervention on the supply side: tax credits and more funding for Canadian new media. This is essential. But on-demand programming still needs CanCon requirements. On-demand portals (whether Rogers on-demand or, say, iTunes Canada) should be required to carry a certain amount of CanCon. That’s not enough, though, as they could simply let cheap shows languish in the long tail. They could be required to spend a certain amount of their marketing budget on Canadian properties.
Of course, that does nothing about sites like YouTube, the sixth most popular site in Canada. So I’d like to just raise this one issue, although in somewhat of a half-baked state. US channels use geo-blocking (based on the physical location of your IP address) to prevent Canadian viewers from watching shows on US sites. Also, US magazines of a certain size are forced to create Canadian versions that have some CanCon and carry Canadian ads. There are similar laws in place to force Canadian ads into US programming on TV. Why would something similar not be possible for big US sites? First, YouTube and Facebook could be forced to sell Canadian ads to Canadian viewers. Secondly, a portion of that ad revenue could be required to go into developing Canadian content, just as we require of Canadian TV channels.
Now, I’m not saying every US blog with AdSense should have to do a blog post a week on Canadian issues. But we should think about it for the top-20 internet properties.
Anyway, for those of us in the TV, film or internet industries in Canada, that report is definitely a must-read.