HERI Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Canadian Heritage

EVIDENCE

CONTENTS

Wednesday, December 4, 2002

¹

1535

The Chair (Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.))

Ms. Janet Yale (President, CCTA, Coalition Against Satellite Signal Theft)

Mr. Luc Perreault (Chair, Canadian Association of Broadcasters Piracy Committee; Coalition Against Satellite Signal Theft)

Ms. Elizabeth McDonald (President, Canadian Film and Television Production Association; Coalition Against Satellite Signal Theft)

¹

1540

The Chair

Ms. Lise Lareau (President, Canadian Media Guild)

The Chair

Ms. Lise Lareau

The Chair

Ms. Lise Lareau

¹

1545

The Chair

Ms. Lise Lareau

Mr. Jan Ravensbergen (Member, Newspaper Guild of Canada)

¹

1550

¹

1555

The Chair

Ms. Phyllis Yaffe (Chief Executive Officer, Alliance Atlantis Communications Inc.)

º

1600

º

1605

º

1610

The Chair

Ms. Lise Lareau

The Chair

Ms. Lise Lareau

º

1615

Mr. Arnold Amber (Director, Newspaper Guild of Canada)

º

1620

º

1625

The Chair

Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance)

Mr. Arnold Amber

º

1630

The Chair

Ms. Phyllis Yaffe

Mr. Jim Abbott

The Chair

Mr. Michael MacMillan (Chairman and Chief Executive Officer, Alliance Atlantis Communications Inc.)

The Chair

Ms. Lise Lareau

º

1635

Mr. Jim Abbott

The Chair

Mr. Jim Abbott

The Chair

Ms. Christiane Gagnon (Québec, BQ)

The Chair

Mr. André Bureau (Chairman of the Board, Astral Media Inc.)

º

1640

The Chair

Ms. Christiane Gagnon

Mr. André Bureau

Ms. Christiane Gagnon

Mr. André Bureau

º

1645

The Chair

Mr. Dennis Mills (Toronto—Danforth, Lib.)

The Chair

Ms. Sarmite Bulte (Parkdale—High Park, Lib.)

º

1650

Mr. Michael MacMillan

Ms. Sarmite Bulte

Ms. Phyllis Yaffe

Mr. André Bureau

º

1655

Ms. Wendy Lill (Dartmouth, NDP)

The Chair

Ms. Wendy Lill

Mr. Jan Ravensbergen

»

1700

Ms. Wendy Lill

Mr. Jan Ravensbergen

The Chair

Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.)

»

1705

Mr. André Bureau

Ms. Liza Frulla

Mr. André Bureau

Mr. Jan Ravensbergen

»

1710

The Chair

Mr. Jan Ravensbergen

The Chair

Mr. Jim Abbott

Mr. André Bureau

Mr. Michael MacMillan

Mr. Jim Abbott

Mr. Michael MacMillan

Mr. Peter Miller (Vice-President, Planning and Regulatory Affairs, CHUM Television)

»

1715

The Vice-Chair (Mr. Paul Bonwick (Simcoe—Grey, Lib.))

Mr. Arnold Amber

The Vice-Chair (Mr. Paul Bonwick)

Mr. Arnold Amber

»

1720

The Vice-Chair (Mr. Paul Bonwick)

Mr. André Bureau

The Vice-Chair (Mr. Paul Bonwick)

Ms. Christiane Gagnon

»

1725

Mr. André Bureau

Ms. Christiane Gagnon

Mr. André Bureau

The Vice-Chair (Mr. Paul Bonwick)

Mr. André Bureau

Ms. Christiane Gagnon

Mr. André Bureau

Ms. Christiane Gagnon

The Vice-Chair (Mr. Paul Bonwick)

Ms. Sarmite Bulte

The Vice-Chair (Mr. Paul Bonwick)

Ms. Wendy Lill

Mr. Arnold Amber

»

1730

The Vice-Chair (Mr. Paul Bonwick)

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CANADA

Standing Committee on Canadian Heritage

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NUMBER 009

l

2nd SESSION

l

37th PARLIAMENT

---

EVIDENCE

Wednesday, December 4, 2002

[Recorded by Electronic Apparatus]

¹  (1535)  

[English]

    The Chair (Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.)): I'd like to call the meeting to order.

    I've agreed to give three witnesses ten minutes to show us a short video about satellite piracy. They have promised me it will take ten minutes, so we can carry on with our other invited guests.

    I'll give the floor to Mrs. Janet Yale.

    Ms. Janet Yale (President, CCTA, Coalition Against Satellite Signal Theft): Thank you, Mr. Lincoln, as committee chair, and committee members, for giving us the time to present to you on behalf of the Coalition Against Satellite Signal Theft.

    We're here today to profile the public service announcements for the committee, and to explain the public education initiatives our coalition has undertaken.

[Translation]

    Our coalition is made up of a group of broadcasters who are concerned about the situation, as well as the CBC, producers, cable companies and satellite distributors from all over North America, including DIRECTV, Bell ExpressVu and Star Choice.

[English]

    The Canadian Association of Broadcasters is represented here today by the chair of the digital piracy committee, Luc Perreault; and by the Canadian Film and Television Production Association and their president, Elizabeth McDonald.

[Translation]

    We are here today because of the growing problem facing the broadcasting system. It is estimated that there are between 520,000 and 700,000 illegal satellite antennas that are short-circuiting the Canadian broadcasting system. This is a very serious problem.

[English]

    We believe there are roughly two million legal satellite systems in Canada now, and our figures show, using a very conservative number, that a market one quarter of the size of that is operating illegally in this country. I say it's a conservative number because there are many in the industry who will tell you the problem is more likely in the million range.

    We've joined together to address this problem on a number of fronts, including public education, litigation, and enforcement. We want to talk to you today about the public education initiative, which was created largely at the request of the Minister of Canadian Heritage, the Honourable Sheila Copps.

    Mr. Luc Perreault (Chair, Canadian Association of Broadcasters Piracy Committee; Coalition Against Satellite Signal Theft): Illegal satellite theft comes with a very heavy price tag, in the neighbourhood $400 million. This is the approximate total of the amount of revenue lost to broadcasters, specialty services, producers, and cable and satellite distributors due to satellite theft. It is too early to quantify the impact on employment in Canada's cultural industry,

[Translation]

but our coalition has targeted its energy to ensure that all Canadians are informed that piracy is theft, and that goes for satellite signals as well.

[English]

    Through a broad-based educational campaign, including print, radio, and now television, we are getting the message out that stealing satellite signals is a crime.

[Translation]

    The objective of this broad multimedia campaign is to make people aware that stealing satellite signals is a crime.

[English]

    Broadcasters are donating time on their networks for a 13-week period to run these ads, and where possible, run them on their holdings in radio and print.

[Translation]

    Recently, we were encouraged by and applauded the action of the RCMP which resulted in seizures in Winnipeg, Montreal, Regina, Saskatoon and, earlier this week, in Kingston, Peel and Toronto.

[English]

    We hope these actions will begin to put a chill on the market of illegal satellite equipment, and we also hope that this information campaign will aid all enforcement efforts.

    Ms. Elizabeth McDonald (President, Canadian Film and Television Production Association; Coalition Against Satellite Signal Theft): Our goal is to raise awareness that this is not a victimless crime. Theft of television signals is stealing from producers, actors, directors, technicians, and thousands of others who provide services to this industry. Copyright is its essential asset, and if it is undermined, Canadian workers are hurt.

    From the producers' perspective, this crime is immediate: $400 million is being syphoned off from the system. The Canadian Television Fund alone is estimated to be losing at least $4 million to $7 million annually.

    The budgets of most Canadian productions are small, often only in the few hundred thousand dollar range, yet these small and medium-sized companies are providing over 100,000 jobs each year.

[Translation]

    We are sure you share our concern about this problem. We hope that the people of Canada will start to understand, as a result of this campaign, that theft is theft, and that goes for satellite signals as well. Thank you.

¹  (1540)  

[English]

    The Chair: Thank you very much to all of you. I appreciate that you respected the time you were allotted. Thank you.

    I will now call on our other witnesses: Lise Lareau, president of the Canadian Media Guild; from the Newspaper Guild of Canada, Mr. Arnold Amber and Jan Ravensbergen; from Alliance Atlantis, Phyllis Yaffe, chief executive officer, and Michael MacMillan, chairman and CEO; from Astral Media, Monsieur André Bureau, président du Conseil; and from CHUM TV, Peter Miller, vice-president, planning and regulations.

    We will start with those who are at the table now, because I understand you want to address the question of cross-media. We'll open the meeting with the Canadian Media Guild, Madame Lareau.

    Ms. Lise Lareau (President, Canadian Media Guild): Merci.

    We would actually like to speak about foreign ownership and cross-media ownership, if that suits you at this stage.

    The Chair: That's okay.

    Ms. Lise Lareau: I am president of the Canadian Media Guild, which is--

    The Chair: Ms. Lareau, in view of the number of people here, if you could keep your remarks brief--

    Ms. Lise Lareau: We will.

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    The Chair: --so that we will get a chance....

    Ms. Lise Lareau: Just to describe how we all fit together, I am president of the Canadian Media Guild, which is one local of the Newspaper Guild in Canada. The Newspaper Guild represents a lot of people who work at CanWest-owned operations. As a result, we have a distinct opinion about what is going on in terms of cross-ownership in the media in this country.

    You've heard here in the past few weeks in particular a lot about cross-ownership. You've heard the disparity of views--everything from how it's really a myth, it doesn't really matter in a hundred-channel universe anyway, who cares about cross-ownership, people have all kinds of access. And you've heard that it's a real threat to media integrity and diversity of views.

    The same is true on foreign ownership. You've heard lots here that it's a threat to our sovereignty and you've heard probably an equal amount that it's needed for capital. Those of us who work on the ground in some of these operations have a distinct view. Our job here today is to tell you a little bit about what it's like to work on the ground in a climate of cross-ownership now and what it could be, and the potential perils of what that may be like, under foreign ownership, if the rules were loosened up to allow more foreign ownership.

    Actually the beginning of this is kind of funny because of the uncertainty about sitting with union colleagues, I guess. I'd like to start with a little bit of humour here and to distribute this to you folks--a little editorial cartoon about what convergence in cross-ownership potentially means to many of our members. What we have here is a man who is carrying everything from a mike, to a computer, to a television camera, to a note pad, to a television screen, and he is the media. I will distribute this to you folks and then proceed.

    I am going to now introduce my colleague, Jan Ravensbergen, who is with the Montreal Newspaper Guild and a reporter at The Gazette. As you know, The Gazette is owned by CanWest and the Asper chain and probably has taken a symbolic role in the issue of cross-ownership in this country in the past year and a half.

    Mr. Jan Ravensbergen (Member, Newspaper Guild of Canada): Good afternoon, everyone. I am the first vice-president of the Montreal Newspaper Guild and I am here to give you the report from the trenches. Cross-ownership has brought convergence to the newsroom inside The Gazette and to many other newsrooms across the country. I would like to give you some insight into what has happened and how that is being dealt with. You don't read all about it in all of the newspapers in this country.

    As regards the national editorial issue, which I guess everyone is familiar with now, we don't have to go into much detail, but that's only a symptom of some of the other attitudes, approaches, and policies that have been introduced under a cross-ownership scenario. The CJFE, Canadian Journalists for Free Expression, did a very detailed report, and we have copies, so that can give you a bit of a sense of how it evolved. But the issue is centralization--centralization of opinion, centralization of control over opinion, centralization means less diversity. That's a word everybody seems to be using these days. I'm proud to say the guild has been using it for quite a while, specifically in this debate in front of the CRTC and in others.

    It goes to news coverage and it goes to opinion--how the news is covered, by whom, by how many people, and how many perspectives. We have seen a narrowing of perspectives under a cross-ownership scenario. We have seen a narrowing of opinion. The name Lawrence Martin comes to mind, for one.

    There is an expression that is floating around, and again you won't find it if you go looking through some of the newspapers in this country, and it is two words: “newsroom chill”. In fact, one of our members used that expression in a column, a column that she wrote to talk about freedom of expression issues, a column that was triggered by a speech in Montreal about the Middle East and Middle Eastern issues and media coverage. References to newsroom chill were taken out. They were removed in the editing process.

    That will give you, I think, a sense of some of the issues we are very concerned about. Columns have been spiked--Stephen Kimber and many others. Everyone in this room, since you are in Ottawa, recalls a very rich history in June regarding Mr. Russell Mills.

    Specifically, the evolution of the philosophy behind national editorials has also permeated other areas, in the sense that we are now seeing a scenario where people and editing are being centralized. There are a couple of people who work what's called “the desk” at Southam News here in Ottawa. The word came down from Winnipeg recently that those people had a choice: they could either move to Winnipeg or join the unemployment lines.

    The word also came down that more people would be hired. Now, that's a marvellous piece of news--that journalists and copy editors are going to be hired, particularly given the financial context of CanWest. There are going to be, we are told, between 15 and 18 jobs created in Winnipeg. What are these people going to do? These people are going to handle centralized copy. These people will be editing and assigning and maintaining control over what goes out on the Southam newswire from Winnipeg.

    Questions come to mind. If 18 people are being hired, how much attrition will there be, how many people will disappear from newsrooms across the country? Will we have one perspective? Will we have a situation on the Hill, for example, where there will be fewer people covering important events, and one reporter's take on a situation or a news development will be published in 18 or 20 or 25 newspapers across the country? Do we have a situation, and it's fairly clear it seems to be on the horizon, where you can't expect a lot of elements of regional interest and regional flavour--what people say in Ottawa or in Regina or in Vancouver about a particular issue being discussed on the Hill--in a story that is written for publication in 20 or 25 newspapers?

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    That's very disturbing, because it goes not to what the national editorials represent, not to what a diversity of opinion or of columns or decreasing diversity represents, but to the information that is essential to the public, to Canada, so that there can be a full understanding of public issues and the depth that print offers in these public issues. That is being diluted and diminished and narrowed, and that's an extremely disturbing development, again, at the risk of repeating myself, under cross-ownership.

    There are some specific developments on convergence, and I'll touch on them very briefly. Around the CanWest organization we understand there about 20 television cameras installed inside newsrooms. They are operated remote from Global TV technical facilities and they can focus and pan remotely. In The Gazette we call the camera there Darth Vader. There are different hits being done, reporters sometimes give a little heads-up on the local news, and it's seen as primarily driven as a way to cross-promote.

    So again there is an effect of cross-ownership where you have the newspaper being promoted on the airwaves, the airwaves provided courtesy of the CRTC, and you will also see in the pages of The Gazette--for those who read it--a lot of Global ads. So there's an economic driver to this that's extremely interesting.

    In terms of convergence topics, I remember that when convergence was discussed at the licence hearings involving CTV and Global Television, the message that was sent was--this was our famous reporter with 15 different kinds of equipment on his or her shoulders--this will free up other resources so we can provide more and different kinds of coverage. I would like to challenge those who hold that this is still the case to provide some actual numbers, because there's a lot of budget-cutting going on.

    So when you have one person covering possibly the web for print, for television, and possibly for radio, clearly their attentions will be somewhat divided. You'd get less depth, and that is not a good thing. Inside, there is a very strong directive to produce showcase pieces where they can again cross-promote. For instance, recently there was a series of features in The Gazette tied to a series of TV clips on Global Television about the debate over drugs and marijuana. And again, there have been four or five or six of these projects.

    Again, the news judgment seems to be driven by “this is pretty, this is something that shows that convergence is working, please push these projects out as quickly as you can”. Normally reporters or editors will often come up with angles or the hook for a news story themselves. In this case, what drives the subject is not necessarily pure news value but what works both on television and in print.

    Speaking of that, it's like mixing oil and water. The cultures are completely different. It wouldn't surprise you to hear that we refer to it around the newsroom with a bit of imagery--it's the poodle and the St. Bernard: the poodle of course because newsroom staffs in Global Television are quite small, and the St. Bernard because historically, and for very good reason, newsroom staffs are larger in the newspapers. So it's the poodle trying to get together with a St. Bernard, and the wags in the office are saying that the poodle wants to be on top.

    There's a loss of quality in the sense that it takes away the focus from just doing what is required during a particular day for the newspaper. So there's a dilution.

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    One other thing, and I've touched on it already, is the Southam News centralization in Winnipeg. There are many, many more questions than answers.

    I would like to finish by just harking back to the words in a submission by CanWest to this committee in early September. I would draw your attention first to the rich record of other events that have intervened since September 10 of last year.

    “Each of our metropolitan and local newspapers is a strong player in its own community. Each is relentlessly local in its coverage and fiercely independent in its editorial policy.” That was the position. And the commitment, the undertaking, was made: “Under CanWest's ownership, that will not change.”

    Yet it's clear, looking at what's been happening, that is changing. It's very disturbing, and again it goes to cross-ownership.

    Thank you very much, Mr. Chairman and committee members.

    The Chair: Mrs. Lareau, why don't we give a chance to Mrs. Yaffe. We'll come back to you after.

    Mrs. Yaffe.

    Ms. Phyllis Yaffe (Chief Executive Officer, Alliance Atlantis Communications Inc.): Thank you very much. Thank you, Mr. Chairman.

    Good afternoon, members of the committee and staff. I'm Phyllis Yaffe, chief executive officer of Alliance Atlantis Broadcasting.

    We'll have a joint presentation today. I'm accompanied by Michael MacMillan, chairman and CEO of Alliance Atlantis Communications; Monsieur André Bureau, chairman of Astral Media; and Peter Miller, vice-president, planning and regulatory affairs, CHUM Limited. I will do the presentation for all three groups, so we've added up our time collectively—if that's all right.

    It's not often we find ourselves at the same side of the table. We generally compete with each other in providing attractive programming to Canadian viewing audiences. But today we come before you with a common purpose. We would like to address two main issues during our presentation.

    The first is whether the current ownership rules for broadcasting programming services, including the conventional, specialty, and pay television services we collectively represent, could be eliminated so long as the services remain subject to existing Canadian content rules. The second issue relates to the prospect of more relaxed ownership rules for telecommunications companies, and whether such liberalized rules should be extended to Canada's cable companies and other broadcast distribution undertakings--BDUs--given that both telecommunications and cable companies are involved in broadcasting activities. We'll address each one of these in turn.

    The first issue is ownership of content providers. The ownership rules for broadcasting programming services are a fundamental lynchpin in the achievements of our broadcasting system. We're pleased to see there is, for the most part, a consensus that the ownership rules for content companies should remain unchanged. We cannot overstate the important role that Canadian ownership and control of broadcasting companies has in shaping a distinct and diverse Canadian broadcasting system. Canadian ownership and control rules for broadcasters have provided the necessary conditions to allow our entire content sector—script writers, artists, actors, directors, producers, distributors, and broadcast companies—to cause content to be created, produced, acquired, presented, and scheduled that reflects and promotes Canadian values, stories, and perspectives to our viewers.

    There is in fact a direct linkage between effective control of our broadcast platform and the achievement of a uniquely Canadian perspective and point of view within the overall North American context. Without these ownership rules, the inevitable result would be a purely continental view, one that subsumes the Canadian view under a continental influence.

    One might argue we should not be concerned about ownership as long as these owners play by our rules. Some have suggested we need only require that the president of a broadcast company and a majority of its board of directors be Canadian citizens to ensure Canadian policy objectives are met. In our view, this is overly simplistic. Unless these content companies are fundamentally inspired, run, operated, and managed by Canadians, the cosmetic requirement of a Canadian president or Canadian board members will be meaningless. Their budgets for production and acquisition of programs and day-to-day operations will be subject to the ultimate decisions of the controlling foreign shareholders.

    This is not just a theoretical linkage. The overall perspective of these companies is fundamentally linked to their ownership sensibilities. Keep in mind that there is already a significant level of foreign investment in Canadian broadcast companies. If you now decide to cede control to foreign investors, you would merely ensure the creation of a North American market, leaving broadcast undertakings in Canada as branch plants. Decisions about scheduling and promoting would ultimately be made by foreign owners, who will naturally be looking to maximize the return on their investment.

    These companies are only seeking access to our markets because of a business imperative. They want to extend the reach of their existing activities, whether programming services, Internet services, or distribution services, for a single reason—to increase their profitability, period.

    Of course we too are driven by the creation of profit and shareholder value. We hope to continue to grow both domestically and abroad. But in contrast to these media multinationals, our companies are run, operated, and managed by Canadians, underscoring the fact that our home market is our key market and our first priority.

º  (1600)  

    At the end of the day, is it realistic to ask multinational companies to encourage Canadian cultural diversity and regional Canadian expression as the Broadcasting Act requires? Their primary corporate objective is the singular focus on distributing their programming in as many markets as possible. If Canadian control over programming services were ceded to foreigners, it would be tantamount to surrendering our control over the key creative editorial function performed by broadcasters.

    We play an active role in causing to be created, promoting, and presenting a unique mix of Canadian and foreign television content to our audiences, which helps to strengthen Canadian identity and Canada's place in the global environment. The loss of control over this activity puts at risk a uniquely local and regional viewpoint in favour of a homogenized global perspective, if not squarely a foreign one.

    Removing foreign ownership limits on programming services would inevitably introduce a branch plant economic structure in our broadcasting sector. This would potentially result in the loss of a whole layer of management and strategic and creative talent, as well as the obvious loss of the Canadian expertise in programming and technology associated with the domestic broadcast industry.

    The issue, however, is about more than jobs or talent. It is about maintaining the ability to have control over the most powerful medium of our time by far, a medium that ties Canadians together and is fundamental to maintaining Canada as a proud and distinct nation. We are here today because we all share this view on the ownership of broadcast distribution.

    Now we turn to that subject. You've heard a lot about the issue of relaxed rules for distribution. The cable industry has already pleaded its me-too case to you, asking to be brought along in any liberalization of the ownership rules for telecom companies. We're relieved, however, to see that no Canadian company has suggested to you that, if BDU ownership rules are relaxed, the rules for programming undertakings should also be changed. We support that approach.

    Nevertheless, we wish to caution the members that there are several challenges raised by the proposed changes, even if they are focused only on distribution. Today many Canadian media companies have combined ownership and control over BDU and programming undertakings. Members of the cable industry argued before you last week that companies involved in both carriage and content will face a business decision about whether or not to take advantage of any change in the rules by creating separate and distinct corporate identities with separate management and boards of directors with no link between the two.

    All this sounds simple in theory, but in reality there is more to it than just the technicalities of corporate reorganizations and structural separation. Structural separation is a concept that has been borrowed from the telecommunication sector. If you recall back nearly twenty years ago, Bell Canada effected a corporate reorganization in which BCE Inc. was created from Bell Canada so structurally separate companies could engage in activities without creating accounting and cost-allocation problems. For example, BCE wanted free rein to do new ventures in places such as Saudi Arabia while also complying with regulatory policy that prohibited this activity from being subsidized by Bell Canada subscribers. Structural separation was the solution. It was effective in resolving some fundamental accounting issues.

    But in this case we are not talking about mere costing methodologies or accounting procedures. There is a unique relationship between broadcasting content companies and broadcasting distributors, one that has little to do with solutions of structural separation. The role of a broadcast distribution undertaking in our system is difficult to surgically remove from the overall anatomy of our broadcasting system. Once the ownership distribution genie is let out of the bottle, the prospect of non-Canadian influence over programming services is raised yet again.

    Last week you heard representatives of BCE explain that BDUs are not really the analog of, the same as, common carriers. As they explained, there is an established legal concept that says that a common carrier cannot control the content or influence the meaning of the content of what is being carried. But when a broadcast distributor offers television programming to its subscribers, it does something very different. Unlike a phone company, the BDU has an active role in controlling or influencing the contented offers. It makes critical decisions about which services to market, promote, and package as well as the appropriate level of resources that should be devoted to such marketing and promotion. It also negotiates vital wholesale prices and sets program packages. It sets retail prices and programs the barker channels. So BDUs make programming decisions every day. They play an indispensable role in shaping the nature, character, and perspective of Canadian programming services.

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    That's how different the two functions of common carriage and broadcast distribution are, and as we go to the world of hundreds of channels, digital channels, there is more influencing in choosing on the part of the service offered as to what people get to see and hear: what's economic, how it's packaged, and what gets carried.

    As you know, under the current ownership rules non-Canadian investors already enjoy significant minority interests in both BDUs and programming services. This reflects an assumption that all links in the broadcasting chain--production, acquisition, presentation, scheduling, and distribution--are owned and controlled by Canadians. Keep in mind that at the time the foreign ownership rules were adopted in the late 1960s there was no vertical integration. The ownership patterns at that time generally reflected silos in which distribution and programming were carried out by separate and distinct unaffiliated entities.

    In today's distribution environment BDUs are enjoying far more leverage over programmers. Recent industry consolidation has made the BDU platform even more critical to a programmer. Because of the balance established in our foreign ownership rules, our cultural policy goals have been shared between BDUs and programming undertakings. In today's highly consolidated environment, if you remove one of the links in the chain and permit non-Canadian control of the distribution pipeline, things will start to unravel. If you allow foreign control over BDUs, non-Canadian influence over the entire Canadian broadcasting system will be significant, even if you leave the programming ownership rules unchanged.

    It is not simply a matter of a U.S.-owned BDU operating in Canada complying with CRTC requirements. Why? Because it is not just about access to capital. Keep in mind that there is already a significant level of foreign investment in Canadian broadcasting companies. We should not forget that while there is a limit on the voting side, there is no limit on ownership of non-voting equity. Canadian BDUs are not in fact prevented from accessing foreign capital. If there are foreign companies who wish to invest in Canadian BDUs but are not satisfied with simply owning non-voting shares, presumably it is the strategic operating control they seek. Let's be clear. This is not about accessing foreign mutual funds or pension funds or getting more access to stock markets in general. This is all about ceding strategic operating control to non-Canadian media companies.

    If integrated foreign media companies were to gain control of a Canadian BDU--and remember, we're talking about strategic operating control--it would surely and quite understandably be driven by a different set of concerns. Such companies are not just cable companies or Internet portals. They're generally dominant distributors of a very large volume of television and film programming. They would have a natural incentive to promote their own content whether on non-Canadian services currently available to Canadian BDU subscribers or with programs their other arms already sell to Canadian broadcasters. They have the means and the leverage to prefer their own properties.

    So there's a real potential for significant influence over programming undertakings by non-Canadian investors who control the BDU platform. This potential for influence is magnified by the fact that under the current rules they can take significant minority ownership stakes in Canadian program services. Once you introduce non-Canadian BDU control alongside existing cross-ownership of programming services, it becomes far more difficult to ensure continued Canadian control over programming decisions. We've managed under the current rules to strike a balance and to allow a non-Canadian to enjoy significant minority ownership interest in both Canadian programming undertakings and BDUs.

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    However, once a non-Canadian investor is also permitted to control the distribution platform, we risk losing the checks and balances of our current system. It's one thing for the current level of cross-ownership between BDUs and programmers to exist among domestic companies. It's another thing completely to allow such integration by a single non-Canadian investor who acquires control of a key link in the broadcasting distribution chain.

    We have heard the cable industry's arguments for allowing BDUs to access more non-Canadian capital. We believe that the ideal solution is to maintain the existing ownership rules for both broadcasting distribution and programming. However, if ultimately changes to the BDU ownership rules are recommended, we would urge policy-makers to recognize that a change made to one policy lever will inevitably have consequences for other policy goals. In such event, we propose a limitation that prevents a non-Canadian who acquires control of a BDU from acquiring or retaining any interest in a Canadian programming service. This, in our view, is the bare minimum to reduce the inherent risk that foreign control of BDUs imposes on our existing broadcasting policy objectives.

    Thank you for your time. We'll be happy to answer your questions in both English and French.

    The Chair: Thank you, Ms. Yaffe, for the challenge you pose to us and for being so forthright.

    Ms. Lareau, do you or Mr. Amber want to conclude?

    Ms. Lise Lareau: I had wanted to note one thing before throwing it to my colleague Mr. Amber.

    The Chair: Don't throw it too hard.

    A voice: He can take it.

    Some hon. members: Oh, oh!

    Ms. Lise Lareau: Mr. Ravensbergen was speaking here on behalf of the Newspaper Guild, and not The Gazette. As you know, if he were speaking here for The Gazette, he would be under a gag order. I wanted to make that perfectly clear. I think that also illustrates a point in this entire discussion.

    More to what Ms. Yaffe was speaking about, my colleague Mr. Amber is now going to discuss the potential loosening up of foreign ownership in media.

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    Mr. Arnold Amber (Director, Newspaper Guild of Canada): Thank you very much. I'm glad to be here to represent some views concerning the foreign ownership issue.

    I actually have been amazed at the debate thus far, because I think there's a fundamental issue here, and that is the contention by those who wish to loosen the restrictions on foreign ownership and control...and the fallacy about the ability of the Canadian economy to support the industries in question.

    I'm not an expert on telecommunications, but I certainly know a lot about newspapers and broadcasting. In fact the record over the last twenty years in this country has been extremely healthy in the issues of acquiring and selling properties in newspapers, in radio, in television, and in the Internet. Let me draw a map for you.

    Twenty years ago there were a number of papers from very large cities in Canada like Montreal to much smaller cities like St. Catharine's, Ontario, that were owned by families. Over the last period of time nearly all sizable family-owned newspapers have disappeared and they've been replaced by a succession of owners, people who put up real money, and in some cases very big money, to buy newspapers.

    So we had the Southam group. We had the Thomson group. We had the Sifton group in Saskatchewan. We had the Free Press group. And all of them now are gone. They've been replaced in turn by other groups. In 1996 we had Conrad Black walk in and take control of Southam through another group, which he developed all of in the last 25 to 30 years, which was the Hollinger group. And then when Black decided to sell, CanWest was there with $3.2 billion to buy up those newspapers. And since CanWest has been on the scene it has decided to sell some of its papers and Mr. Conrad Black sold other papers. We've seen the group out of Montreal, Transcontinental group, we've seen the creation of a brand-new publishing group in this province where Osprey bought 36 papers belonging to Conrad Black for upwards of $300 million.

    We saw a local group in Winnipeg buy the Winnipeg paper from Thomson and buy the Brandon paper. We've seen Quebecor prosper not only in the French-language media, but also in the English-language media, and of course the ever-present Toronto Star, which keeps acquiring properties.

    What I am saying here is that it is a total fallacy to believe that there is not money existent in Canada and we have to turn abroad to invite in American, British, and German people to buy our properties. I'm not saying that every time someone bought a property they paid the right price and they made a good move. But there is money there. And beside all the companies that now exist are sizable banks, and they seem to have the ability to talk any bank into financing almost any deal they wish to make.

    If we go over to the broadcast side--you all know this because you all live out there in Canada and you've noticed the way many times over the last twenty years your radio station has changed ownership--people swap radio stations between one group and another group. Sometimes as many as thirty stations get swapped in a package. We've seen the creation in radio and television of major chains. There's the CHUM group, there's the Standard Broadcasting group, and we've seen the transformation of CTV from wholly owned stations in a cooperative into now a solid one network, which in turn was again sold to a Bell company.

    Global itself, years ago, was not a national network. It is a national network now. In Quebec, you also have seen the development of not one but two commercial channel networks in addition to Radio-Canada.

    My point is very clear: it's that what I know about broadcasting proves beyond a shadow of a doubt that over the last twenty years there is financial wherewithal to create and sustain those industries. In addition, around me at this table are people who've developed large independent production houses and other aspects of the media industry.

º  (1620)  

    The problem about moving away from your control from Canadian to foreign is easy. People who come in and are going to spend hundreds of millions of dollars or even more to buy up your telecommunications, your cable, your broadcasters, or your newspapers don't just come with their money. They also come with their control.

    In the past, we have seen in this country.... I will use one example--the example is a weird one, you may think--TSN, The Sports Network. The Sports Network existed at one stage owned by one group of people. The owners of that were prepared to sell, and there was an internal buyout by senior managers. They didn't have the money, so they sold 30% of TSN to ESPN, which is the large American sports television network controlled, by the way, by Disney. ESPN said they would buy the 30% but they wanted various controls.

    When finally this private group decided to sell again, I have it on good authority that one of the reasons why Global Television did not buy it was because they did not want to have to share with ESPN, the Americans, control of TSN, which has its sister network in Quebec as well.

    What we are looking at here is a debate about a fundamental change, which we have seen in other areas. We have seen deregulation, not only in telecommunications in this country, but also in various other walks of life. Many times when we have gone from regulation to deregulation we have gone from bad to worse or from good to bad. Right now in this province there is an incredible debate about hydro deregulation.

    We have seen the effects of cross-ownership. My colleague has pointed some out to you. Other people have, and others will point that out to this committee as well. At one point we will distribute to you a study about the problems of cross-ownership, which was prepared by the Canadian Journalists for Free Expression. It is a valuable document to read. It doesn't take long to read. We will give it to you because it's about the story of the struggles in CanWest a few months ago. There is some perspective that time has given them to write a proper report about it.

    But let me go back to the foreign issue. What would happen if we give up foreign control in the media is it means the entire editorial agenda changes for Canadians. I think the news changes. Right now we are at what looks to be--I am going to predict--the brink of a war in Iraq. I can tell you I have just spent a week in the United States. What the American readers are getting in their newspapers, what they are seeing on television, is different from what we are getting up here.

    News is too important to give away to foreign people. There is no doubt that if a big company comes up, either from the United States or across the ocean from Britain, our presentation, our news, is going to change. As has been pointed out by Mrs. Yaffe, on the issue of promotion of vertical companies, all the large foreign companies, whether they be British, German, American, or Japanese, are vertical companies. They have something else to promote. If you think you get a little bit teed off now when every time you watch CanWest you see a promotion for one of their newspapers, wait until the Americans get here and begin to mix it all up; then you will find out what cross-promotion is all about. We don't need more foreign view in this country; we need more Canadian view.

    It seems to me that the people who tell us we have to do this to be part of globalization miss one very important point. This is the only country in the world that shares two things with the Americans--the language to a great extent and the vast border making the ease by which messages flow from the United States to Canada.

    So it may be very easy for someone to come here like Mr. Fraser did last week and say it doesn't really matter, because all these other countries don't have limits on foreign ownership of their broadcast systems. Canada is different, and I guess that's why we are here today, because this is the heritage committee, and we have to protect ourselves as a nation. We have to protect ourselves as a culture. We have to protect ourselves as a people. It's very interesting to me that the basis of the argument from the other side is so tied financially.

    I am not going to go in and attack anybody's motives for why they want this, but I will give you one quote. The quote is not from anybody in Canada or anybody in one of the countries that might be an exploiter of Canadian media; it's from the Secretary-General of the United Nations. When he was speaking earlier this year in South Africa at the World Environmental Conference, in his keynote speech he said to all the delegates, “Let us stop being economically defensive and start being politically courageous.”

    This is what I call upon you folks to do today. I ask you this for the present generation of Canadians and those to come.

º  (1625)  

    This committee must say no to the idea of more foreign control of our media in this country. Over the last 50 years various industries have been sold to foreigners piecemeal or sometimes holus-bolus. I cry every time I go to a Tim Hortons. If we couldn't keep Tim Hortons, let's at least keep the media.

    So I say to you--and I do this in a jocular vein, but it's a very serious issue, and the serious issue is that this is something that relates to the heritage committee's role. If other committees want to talk about industry and commerce, let them fight it out on the dollars and cents. But you know, Canada in the end is not just a good health plan. Canada is more than a health plan. It's about a people, it's about a spirit, it's about a history, and it's about a future.

    And I can tell you now, as has been said in every study that's been done in every western European country and in every other country, the media is fundamental to the quality of the democracy. We're saying to you in both parts of our presentation here that the quality of your media is determined partly by Canadians owning it and controlling it. The second point, which my colleagues made, is that in our view the quality of the media is vastly improved if there isn't a cross-ownership situation as well.

    Thank you very much.

    The Chair: You speak well, Mr. Amber.

    Mr. Abbott.

    Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance): Well, Mr. Amber, that was really interesting. I was trying to think how to come back against some of your assertions, and your rather humourous point about Tim Hortons is absolutely spot on the money from my perspective. Yet how and in what way has Tim Hortons changed to the negative? How are they exhibiting a terrible, gosh-awful U.S. attitude as per the Canadian nationalist? How has the issue of the foreign ownership of Tim Hortons changed Timbits one little bit?

    Take a look at the advertising. We still see ourselves reflected in the advertising or we wouldn't go there. Take a look at the product offerings. I've had the opportunity to be offshore a few times this fall, and I can tell you that I love to come back and get a soup and sandwich deal, I really do, because that's my Canadian food.

    You know what? The foreign ownership hasn't changed Tim Hortons and what they're offering or the appearance of Tim Hortons and their Canadiana one little bit. I don't know, maybe you can help me understand how the terrible spectre of Wendy's and those awful old U.S. people has changed Tim Hortons. Obviously that applies to your assertions and, I suggest, to the assertions of Ms. Yaffe.

    Mr. Arnold Amber: I should tell you, there are two risks whenever you try to do humour. One is that no one will get it and they won't laugh, or they will laugh but they'll turn it into something else.

    I actually made my comment about Tim Hortons because it's a visceral issue. Tim Hortons was a very unique Canadian thing, and I still like to think that it's unique from the top to the bottom. To tell you the truth further, I use it more as a point rather than something that really affects me. I happen to be a diabetic, so I never eat at Tim Hortons.

    The point is really, if we're getting serious, that the reason there are heritage committee meetings about the media and not about Tim Hortons is because it's one thing to be making doughnuts and running a very good, very well-run place where people can seek food and comfort, and it's another to be running the media. The media are a fundamental part of democracy. It's about nation building and it's about agenda setting, and for all the things Tim Hortons professes to be, I don't think it covers those areas as well. We're talking about two different things.

º  (1630)  

    The Chair: Thank you, Mr. Amber.

    You also mentioned Mrs. Yaffe, so I was wondering if one of your group wants to add anything.

    Ms. Phyllis Yaffe: I think it was well said by Mr. Amber. He answered for us as well.

    Mr. Jim Abbott: Well, carrying on with this thing, I'd say we are having a respectful debate here.

    What I would suggest to you is the reason Tim Hortons continues to attract Canadians in the tremendous numbers they do--and I don't know how many millions of cups of coffee or doughnuts they sell every day in this country--is because they exhibit to all intents and purposes everything they have always exhibited.

    Mr. Dennis Mills: Who runs it, Jim?

    Mr. Jim Abbott: The difference in ownership is absolutely irrelevant, and I'm suggesting that they will continue to attract people, what with putting the ice down or whatever it was they were doing, all the Canadiana things we do. They will continue to attract Canadians to that because they exhibit all the things that reflect us.

    So again, I suggest--and I'm glad we're having this debate, because I don't see that ownership, the actual decision-making process, is relevant--that if it gets away from what Canadians want and what Canadians expect, they are going to lose their business, just as you would in the news media or in the entertainment business in Canada.

    The Chair: Mr. MacMillan wants to join the debate.

    Mr. Michael MacMillan (Chairman and Chief Executive Officer, Alliance Atlantis Communications Inc.): Thank you.

    One of the points I would make is this. Our view is that television programs are not a regular product. They are not like cups and saucers and pens and paper and so on. They have much important social impact.

    Consider the 21 hours a week Canadians spend watching TV, which is probably the most powerful medium of all time and which probably has one of the biggest effects on how we figure out and feel who we are, what we think, what we remember, and what we hope for. It has an importance well beyond most commodities. It's not a commodity, it's a cultural influence, and that's why we are here to talk about it and not about cups and saucers and pens and pencils.

    Ownership has a great deal of influence, I believe, over what is produced and why. If there were foreign ownership of Canadian broadcasters.... And keep in mind, as Phyllis Yaffe was mentioning, that this debate is not over access to non-Canadian money. It's not about having American or European pension funds or mutual funds, because we all can and we already do access Wall Street. We've all traded in the U.S. pretty much through our non-voting share structures. This is not about money. It's about attracting new shareholders who presumably aren't satisfied with merely a passive economic interest but who want active, strategic operating control.

    In order for active, strategic operating control to be of any use whatsoever.... And if I were in their shoes, I would immediately want to program my Canadian channel as similarly as possible to what I was programming with my U.S., British, or German channel. I'd want to use similar resources and the same programming as much as possible. Ideally, I'd want to amortize the cost across a wider audience.

    I know that in our business, he who pays the piper calls the tune. Most of those programs would very naturally, predictably, and properly be aimed mostly at the largest audience, where most of the cost is being paid. I would fear, therefore, that our Canadian channels would be, first of all, trying to serve a foreign audience, a different audience. They would deal with their preoccupations and not with those of Canadians. I fear, therefore, that the social impact of that programming would change. It is a very different thing being in the cultural product business.

    The Chair: Madam Lareau.

    Ms. Lise Lareau: I want to follow up on that point with something we've seen. We are here to talk about two things here. Cross-ownership has shown us, just the track record over the past two years, the impact in this country of one owner who has incredible penetration in the market and what kind of impact that's had on editorial and other issues. If you were to start discussing in the media, say, the idea of a national editorial policy being dictated from Washington or New York rather than from Winnipeg, you'd get the idea of what kind of impact this could have on the freedom to express issues of importance to Canadians in this country.

    We have seen a track record, and we see what can happen in this country. You open it up to outside interests and I don't think it takes much of a stretch of the imagination to see us looking at national editorials and the like in television being dictated from Washington, New York, or London.

º  (1635)  

    Mr. Jim Abbott: But I saw it as recently as this morning in the Toronto Star. We have a situation where seven years ago we entered into a $2 million program that became a $1 billion program--a 500 times multiple. When questions were asked about the program in the House of Commons, the members of Parliament were kept in the dark. The program was already at $300 million, and the department knew it was going to be $700 million more.

    It seems to me that's newsworthy, and it's no surprise it ended up on the front page of the other two national papers. I couldn't find it anywhere in the Toronto Star. I went to the site and was astounded that they wouldn't report something as outstanding and egregious as that because editorially they supported the gun control program.

    The Chair: What is your question, Mr. Abbott? You have to move on there. What is the linkage?

    Mr. Jim Abbott: I suggest to you there are editorial decisions being made every day, and if I were in the Toronto area and didn't like the editorial policy of the Toronto Star, I wouldn't subscribe to it.

    If I don't want to watch Global, I won't watch Global. If I don't want to watch whatever, I make those choices. The marketplace will end up making the decision. But meanwhile, back at the ranch, I take it you're suggesting foreign ownership will suddenly change the editorial decision-making process. I'm suggesting that may be the case, but the marketplace will ultimately work that through the system.

    The Chair: I think we'll leave it like that. You'll have all kinds of opportunities to pick up on what Mr. Abbott has said.

    Madame Gagnon.

[Translation]

    Ms. Christiane Gagnon (Québec, BQ): I think the issue is more complicated than a decision to eat cookies or to watch one program rather than another. When it starts to be a sort of control over the type of programs we want to watch, the situation becomes more serious.

    Personally, I have doubts about the possibility of loosening foreign ownership restrictions for broadcasting distribution undertakings. In Quebec for example, if a decision was made to invest in the cultural industries, that could limit public support for culture.

    Would a company in which the majority of shares were owned by foreigners rather than Canadians have enough power to require governments to invest less in culture, on the pretext that it would be disadvantaged otherwise? There has been a recent example of this situation.

    Does such an eventuality scare you? Are you afraid that this type of pressure would be exerted by American owners, for example?

    The Chair: Mr. Bureau.

    Mr. André Bureau (Chairman of the Board, Astral Media Inc.): I must confess that we never looked at the issue from that point of view.

    The fact that a foreign owner of a Canadian television service may or may not have access to financial support programs for television or film productions would not change the situation significantly.

    I think it would be quite easy to claim that some rules may apply under the Canadian content requirement. However, as you say, the problem is much more fundamental.

    First of all, we have to understand that the Canadian broadcasting system is sort of our last bastion: it is what allows us, even today, to speak each other, to express our views and our talents from one ocean to another. It is also an industry that has developed in a rather exceptional way. Because of its development, artisans, writers, musicians and artists of all types have had an opportunity to display their talent and ultimately to become known elsewhere.

    It is said that...[Editor's note: inaudible]...of ownership has been changed and that gives rise to two different effects. If there has been a change in the area of distribution, either with respect to cable or satellite distribution, it could happen that the new owners, since they have an important role to play to support the work done in programming, may have different concerns, priorities or objectives.

    There's a danger that we would find ourselves quickly placed within a foreign model. Although we have not yet mentioned the company in question, we should not be too naive about this: I have not met any Latvians lately who wanted to purchase our services. However, we know there are others, and we recognize them easily, who are just waiting at our door.

    If these people come in and become the effective owners of our companies, they will not be, as Michael was saying earlier, managers of the pension plans or a group of shareholders in the United States, but rather companies that are already developing in this field and that want to take advantage of the opportunity to do a little more dumping in Canada. So they are going to come into our country buy up our properties and then do everything they can to offset their costs, as they are already doing in their own country.

    We have to wonder what would ultimately be gained. As far as broadcasting goes, we do not need access to the American market; not a single broadcaster has come to tell us otherwise. The fact is, we already have access to that market.

    In addition, all those who want to invest in our companies may do so, and when, for our part, we need money, we issue non-voting shares. We have been warned that if, for whatever reason, distributors were to obtain the right at issue, the consequences would be serious.

    At the least, make sure that this is not just air and make sure that these individuals do not come in through the distribution door and become 100% owners of distribution undertakings, while at the same time being entitled to 43.6% or 46.3% of our programming companies.

    We think there should be an air-tight separation between the two. That does not rule out the right for some interest in the company, but it means that it will not be the same individuals as those controlling distribution.

    That is what really counts, since there is already too much concentration in this field.

º  (1640)  

    The Chair: You may ask a final question, Ms. Gagnon.

    Ms. Christiane Gagnon: Yesterday, some witnesses told us that in the cultural industry, the financing ceiling—20% for licence holders and the other percentage, 33.33%—has not been reached. It is reasonable therefore to ask why we would want to increase the percentage on the total at the moment, which is not being used.

    Can you provide us with any information on that?

    Mr. André Bureau: I cannot provide you with any information, but I can draw a conclusion.

    Some American investors are interested in investing in distribution and programming, but they do not want to come here to be merely passive shareholders, they want to take control. That is what they are interested in. They work in these media themselves, and they will want to broaden their activities and maximize their profits.

    These people are not interested in passive investment in our companies; that is why they are not coming.

But the day we open up the door to them, you will see them in here fast.

    Ms. Christiane Gagnon: Would we be the only company to open up the door in this way? Would we be in the vanguard, if ever...

    Mr. André Bureau: We have often been in the vanguard, Ms. Gagnon, and that is not what concerns me, because our situation is not comparable to any other.

    The Canadian context is completely different from France and England, particularly England, which has always felt protected and continues to think that. Here, we have never felt protected. We have had them at the door of our country, for heaven's sake, as a model and as an influence, and now we have satellite penetration. They have always been there. So our situation is not at all the same as that of other countries.

    I do not think that what we are proposing today is necessarily what should be done in England or in some other country. We are trying to find a solution that will limit the impact of a massive influx of these people into our country.

º  (1645)  

[English]

    The Chair: Mr. MacMillan, you'll have a chance during the debate too.

    Next are Mr. Mills, Mrs. Bulte, Mrs. Lill, and Madame Frulla.

    Mr. Mills.

    Mr. Dennis Mills (Toronto—Danforth, Lib.): Thank you very much, Mr. Chairman.

    Witnesses, you've done a fantastic job here today. I was saying yesterday in committee that over the last couple of weeks I've been travelling to different parts of the country. You should know that the number one emerging issue right now, especially among younger people and university people who are just graduating, is the whole issue of foreign ownership. It is going to come at us in the next few months from the people of Canada like a ton of bricks. Ms. Yaffe, we need a thousand CEOs in this country who share your views.

    I want to move my remarks over to Mr. Abbott, and link his point about donuts with Mr. Amber, because it is extremely relevant. In the last eight years in this country, we have lost to foreign ownership $500 billion worth of Canadian assets. Now it's not about doughnuts and coffee; it's about who does the creative quality advertising for these firms. Look at our ad industry in this country. It's in shambles. Who controls the purchasing? Do you think the purchasing for these multinational organizations is run out of the branch of the company in Canada that was just furnished?

    I know of dozens of CEOs in my own city in Toronto right now who receive e-mails on how to run their companies in Canada. They no longer have the capacity to use their ingenuity. There are controls on the way they purchase and the way they operate--it's crazy. The country is slipping away from us.

    The cultural sector is the last sector in which we have a shot at maintaining some real Canadian identity and presence, and there's an infrastructure there that affects the lives of millions of Canadians. So if this committee is really going to have any kind of substantive meaning, along the lines of Kent and Davey, we cannot fudge on this issue of ownership in any way, shape, or form.

    We have to take the lead in this committee and set an example for the industry committee, which over the last seven to eight years has been very quiet on this very important issue.

    Thank you.

    The Chair: Thank you, Mr. Mills.

    Mrs. Bulte.

    Ms. Sarmite Bulte (Parkdale—High Park, Lib.): Thank you very much. I want to thank everyone for coming as well.

    I want to go back to what you said at the end of your presentation. It almost flows from what Dennis is thinking. In your paper you say “We would urge policy makers to recognize that a change made to one policy lever will inevitably have consequences for other policy goals”.

    What concerns me is the presentation made by the cable companies, where they talked about the CRTC decision 96-1 recognizing that cable companies are also carriers under the Telecommunications Act. Currently, the industry committee—not the heritage committee—is looking at foreign ownership or whether there's a review of the telecommunications industry.

    In your opinion, it is almost as if the left hand and the right hand don't know what they are doing. If the industry committee came down with a recommendation to allow foreign ownership in the telecommunications industry, will that policy not inevitably require us, almost with this lever you talk about, to open up the foreign ownership in the BDUs just as you're talking about? I have great concerns, and I share your concerns. At one point it will start with allowing foreign ownership of telecommunications, then we'll have the cable companies, and then we'll have the programming. What stops us from inevitably having the CBC owned by foreign ownership?

    Are you making the same submission to the industry committee?

º  (1650)  

    Mr. Michael MacMillan: Perhaps we should.

    I think we and everybody know that the left and right hand know what each other is doing. There is a process in industry, and there is a discussion about changing the telecommunications rules. I think it's bloody disingenuous of us to say, “Oh my gosh, if we do change the telecommunications rules, a year later, oh, we will have to change the BDU rules because it's only fair”, and the year after that to say, “Oh my gosh, look, the BDU companies are also in the content game. I guess we'd better change the content rules.” We know all of this now, ahead of time. Who's fooling who?

    It's the only possible set of logical decisions that would flow from this. That's why now we have to look at the initial decision, which is a telecommunications ownership rule. Otherwise, we're going to be fighting for our lives in content. We know this now.

    Ms. Sarmite Bulte: Mrs. Yaffe, you talked about the cable companies. I understand that part of their presentation, which I was not here for, addressed the role of the regulator. They said the regulator would act, and asked why anybody would come in and not listen to the regulator, because it would make good business sense and because the regulator has rules. But if you look at the Broadcasting Act, there's also a requirement for regional and local perspective. Yet I'm hearing Mr. Ravensbergen say in his presentation that we're getting a national policy, and the whole local and regional perspective is being overlooked completely. People are going to say, “What can the regulator do at this point?” I guess this is a concern. If you could just elaborate on the CRTC's role....

    I think we're fooling ourselves completely. Anybody who thinks for sure that just because you have Canadian-controlled directors.... We all know from basic law school that all you need is a unanimous shareholders' agreement taking away that control, and boom, the control is gone.

    Ms. Phyllis Yaffe: I think the answer to performance in front of a regulator is that, of course, everybody expects everyone to uphold laws in foreign countries when they bring their businesses there. I guess that would be the fundamental point of entry. They would have to obey laws.

    But the broadcast system is made up of laws, and it's made up of the spirit of what we're here to do. It's made up of understanding the Broadcasting Act and committing yourself to actually uphold the Broadcasting Act. I guess you have to ask yourselves the very fundamental question, “What is the business imperative of a foreign-owned company to come to Canada to be in broadcasting?” It's clearly not to represent all parts of the country to themselves and to each other. It cannot be, as their fundamental economic interest is not being served by that.

    So I would expect everybody to behave properly. But I would also say their first efforts, in terms of upholding the rules and laws in a country, would be to uphold the economic rules and laws, which is to export their fundamental properties around the world. This is what multinationals are in the business of doing. This is their fundamental reason for getting up in the morning.

    So I would never ascribe foreign companies not coming to Canada and upholding our rules, but I would ask where their priorities would lie, in terms of more than just the rules. Rules don't set the broadcast system: the spirit and the contribution we all make is much more important than just the rules.

    Mr. André Bureau: It's easy to compare it to the behaviour of foreign people coming into Canada and abiding by some rules, like the speed on the roads. That's pretty easy, and doesn't need a lot of interpretation or sensitivity. But when you talk about being in charge of a grid of programs for a specific market or target group, and you have to decide whether you will do it the way they do it in the United States or France--because we don't want to mention anybody in particular--they don't do it the same way. It's that simple.

    It's impossible to ask the CRTC to oversee that, watch every program, and say, “Ah ha, you're losing the spirit of your local mission”. It's not something you can count like that. We will end up with a lot of programming done under the model of some foreign-interest expertise, and it won't necessarily be what we would like to have here--and what we have here currently.

º  (1655)  

    Ms. Wendy Lill (Dartmouth, NDP): It's really wonderful to hear your comments about foreign ownership, and I'm glad we all seem to be feeling quite bullish against the idea of foreign ownership.

    The Chair: There are exceptions.

    Ms. Wendy Lill: I am very concerned about cross-media ownership. Bruce Wark, a tremendous journalist, came before our committee in May in Halifax. He quoted from John Seely Brown's book, The Social Life of Information--I read my transcripts as well. They wrote that the way forward is paradoxically to look not ahead, but to look around. I'd add that when you look around there's ample concern about the impact cross-media ownership has on local and regional audiences.

    We've travelled across the country and have really seen, up close, the impact that cross-media ownership has had. We were in Winnipeg when WTN went downtown to Toronto with Corus. Alliance Atlantis bought Salter Street, and very shortly after that the independent film channel was taken to Toronto. That's a big problem, from where I sit. BCE bought the CTV stations in northern Ontario, and then suddenly they were leaking money and they had to move.

    All across the country we've heard from local people that they are suffering from cross-media ownership. They are not being served the regional programming--regional comedy, those little stations, those quirky voices. It broke our hearts in Newfoundland to hear that ten programs that had existed there in the 1980s had all disappeared, and the only show they had was a Rogers show called Out of the Fog. This is the place where Codco started. This is the place where comedy in this country cut its teeth, yet they were reliant on this slim little Rogers cable show.

    So tell me how cross-media ownership is serving the interests of the cultural mandate. We are the culture committee, the heritage committee, and I'm not seeing it. I'm not seeing it at the film level or the journalistic level. I know you probably share my views, but I'd like to hear your comments on what I'm saying.

    Mr. Jan Ravensbergen: There are the same concerns you mention about television right across the country in the newsrooms. It's been a very profound challenge for our members, and not just reporters, but copy editors and everyone involved in the news production area.

    One thing that's really crystallized things for us is a fellow in the States named Bill Kovach. Ironically enough, he has put together a book about the elements of journalism. There are a couple of principles, and I think they also speak to cross-ownership and what's going on in terms of opening the doors to Gannet, Knight Ridder, and all of the rest of them.

    Journalism's first obligation is to the truth--local truth. Its first loyalty is to citizens--local citizens. Its essence is a discipline of verification. Its practitioners must maintain an independence from those who they cover, and clearly those who own them. It must also serve as an independent monitor of power.

    All of that speaks to some real fundamentals in this country, because Canada is Canada. I'm from Montreal. That's where I grew up, and I have a regional perception and a flavour of Canada that is different from what you have in Halifax, or right across the country.

»  (1700)  

[Translation]

    Ms. Gagnon, your appreciation of Canada is different from mine and that of Ms. Lill. That is to be expected, and that is what defines us. We are not like American consumers, from A to Z.

    The trend we see everywhere is toward globalization, which removes the control, the sense of citizenship that is ours. Once we open the door in that way—and they are already quite wide open in some areas—

[English]

What have we got? What's left? Hey, free trade, rock and roll--let's do the whole thing and have a political union, and merci le Canada, it was great.

    That's one of the elements. When we talk about heritage, I think of heritage and all the things that make this such a great country. The local flavours, the regional flavours are also what define Canada, and we're losing them.

    Thank you.

    The Chair: Briefly, Ms. Lill.

    Ms. Wendy Lill: We talk about cross-promotion, and I'm wondering if anybody has done any research on the impact of cross-promotion. It's been 15 months now since the CRTC opened the doors to BCE and CanWest Global. Has there been any content analysis of press entertainment pages? I'm wondering what's been done so far.

    Mr. Jan Ravensbergen: It's very anecdotal at this point. Global ratings for the news program haven't really gone up. The Gazette circulation numbers have gone up, to some extent. That may be related more to moves they made, in terms of discounted subscription rates and that sort of thing. So there's no clear evidence that cross-promotion is working.

    Anecdotally, if you look through the pages of The Gazette--I think I mentioned this--you see a lot of Global TV ads. I don't think those are particularly revenue-generating, because it's just a kind of cross-barter deal. So is it working? That's a good question for--I was going to say Mr. Monty--Mr. Asper and Mr. Sabia.

[Translation]

    The Chair: Ms. Frulla.

    Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.): Thank you, Mr. Chairman.

[English]

    I think we're right to be worried about foreign ownership, because look what happened, Jim, in the cinema. It's very hard for Canadian films to get a place to show their films.

    I've negotiated with Jack Valenti, if you can call it negotiations. Francis Fox was my lawyer, and believe you me, they don't give an inch. Even if you tell them it's a French market and they have to at least try to help us to protect our culture, we're different, they don't give an inch. So if you're saying we're worried about foreign ownership, I think we have a right to be worried.

[Translation]

    I would like to direct my question to André Bureau, the former chairman of the CRTC.

    André, Mr. Amber was saying that there is capital available at the moment. So we do not really need foreign capital. However, the corporations have grown. They have grown out of all proportion, often as a result of very large purchases, of properties that were not worth what they paid, just so as to control the market. That is what has happened over the last 10 years. We find ourselves with some extremely large corporations. Some of them are now saying that they are having some financial problems and need help. In the case of such major undertakings, can we still say that there is enough Canadian capital to help these corporations?

    Otherwise, may we see a partial re-fragmentation of some of these large corporations? This could reflect our concern about foreign ownership, but also our concern about cross-ownership.

»  (1705)  

    Mr. André Bureau: You asked at least two questions.

First of all, is there enough money in the market to support these companies?

    I do not want to pass judgment on each individual case, but we know for a fact that companies that were purchased two, three, four or five years ago fetched prices we are no longer seeing today. The multiples being paid in the market today for shares in the companies have dropped dramatically. Obviously, there is a considerable difference in value, which limits their opportunity to borrow and their growth potential.

    Is there enough money in the market? I do not know whether there is enough money in the Canadian market as compared to the American market, but there is no doubt that the current foreign ownership rules do everything necessary to enable a company, whether it be Star Choice or Quebecor, to go to the American market for financing through non-voting shares. To be clear here: we are talking about non-voting shares.

    If they cannot sell non-voting shares, if the American market is not interesting in non-voting shares, then we have to ask why not. Here we encounter the next question: is it not because those who would be interested in coming to Canada are people who work in this media in the United States? The fact is, these people will not come in as passive players; they will come in as controlling shareholders. That is the first point.

    In your second question, you referred to the possibility of fragmentation...

    Ms. Liza Frulla: A new fragmentation.

    Mr. André Bureau: ...or a new fragmentation of these companies. I know that at one point, the Department of Heritage wondered whether there would be any Canadians who could pay the required price to buy up any of these fragmented companies we have here, if that become necessary.

    I can tell you that I am assured that this could be done. The three of us here have companies with quite high stock values. And despite that fact and the extra that would have to be paid to purchase our companies, there is no shortage of buyers at the moment. People have been interested in buying up our companies for a long time—and I can speak for the three of us here. So there are Canadians out there who are prepared to buy, to invest in this area in Canada. I'm talking about Canadian entrepreneurs here.

    It seems to me that if there were some fragmentation of some of the companies that may have been a little too greedy at one point, these smaller companies would find Canadian buyers very quickly if they were put up for sale.

    Mr. Jan Ravensbergen: Ms. Frulla, on the question of fragmentation, it could happen, because of business circumstances, if this is allowed under the act, if you open the door yourselves, that a company such as Knight Ridder, Media General Inc. or one of the other large American firms could get into the Southam chain, which has about 20 dailies. This could happen despite the issue of the deductibility of advertising expenses.

    There are some lawyers in the room. It is very possible to structure something officially controlled by Canadians, even though the cash is American. There is a danger that could happen in some cases.

    In that case, there would not be cross-ownership as such, because the connection to Global Television, for example, would be broken. However, at the same time, a company such as Media General Inc. could get into the back door.

    There is a publicity video that is very striking. It was presented at the meeting of the Quebec Professional Federation of Journalists a year ago. It is a promotion for financial analysts. Media General Inc. owns the radio station, two television stations and the Tampa Bay newspaper. The closing line of the video is: “In Tampa Bay, we are the news”. Oh boy! I can send you a copy of the video.

    This may be the sort of thing that investors want to hear, but it is not the sort of thing that Canadian citizens think is good for democracy or diversity.

[English]

»  (1710)  

    It's like a chessboard. We see where the players are now. Where the game is now is way different from where it was two years ago. If you had said newspapers that always had an independent editorial policy would suddenly be told, boom, this is the policy and you are not to deviate, nobody would have believed it. Nobody foresaw it.

    The Chair: Mr. Ravensbergen, you make a great speech, but I think we have to move on.

    Mr. Jan Ravensbergen: Thank you, Mr. Chairman.

    The Chair: The point is taken.

    Mr. Abbott, briefly.

    Mr. Jim Abbott: I am beginning to feel like a butcher at a vegetarian convention.

    I would put it back to Mr. Bureau, though, that you are a person who is chairman of the board of your company and who deals with numbers that I probably can't imagine. When you, or anyone else in your position, is dealing with those kinds of numbers, and you ask why would an American company that's prepared to put half a billion dollars into this, that, or the next thing, let it be out of their control, where they don't have any vote, I don't understand your point.

    As a responsible capitalist, would you not want to have a voting control over the many dollars that you would be putting into these kinds of ventures? It just strikes me.... And I also heard Mr. MacMillan--and I wrote it down because I found it difficult to understand--say that the broadcasters, if they came in with the foreign ownership, would be trying to serve a foreign audience. I don't understand.

    The people who are the owners are going to the Canadian market with a product with which, hopefully, they're going to drive an audience and with that audience are going to drive revenue, and that revenue is going to drive the bottom line.

    So I don't understand why we are hung up on foreign ownership at all. I really don't.

    Mr. André Bureau: In response to the first question you asked, obviously, anybody who, as an expert in that sector, wants to invest in media in Canada here wants control. That's perfectly normal. We are not questioning that. We are saying that's precisely what they have in mind. In fact, we're saying they're not coming now because they can't have control.

    If the door were opened, not by you, but if the door were opened at some point, they would all come in. They would all come in either to buy the existing entities there or to dump their service here.

    I'll let my friend Michael respond to your second question, in the hope that by the end of this afternoon you will have joined us.

    Mr. Michael MacMillan: And be a vegetarian.

    Mr. Jim Abbott: A good vegetarian.

    Mr. Michael MacMillan: In terms of the companies we are talking about in theory being interested in acquiring control, as we have been saying a few times, these are not passive pension funds. These are active, presumably existing, media companies that are already successful in other countries, likely, quite frankly, in countries fairly close to home, presumably the U.S. or the U.K., most likely.

    If I were in their shoes, what I would try to do is reduce my costs by using similar programming, or similar programming pieces, in Canada and in that other country or other countries.

    It's very expensive to produce television programming that people want to watch. Producing it only for a Canadian audience, or any audience in any one country, is a real challenge, and if I were in their shoes I would immediately try to homogenize the programming available in, say, the U.S. and in Canada.

    Given that the U.S. market is ten times bigger than the Canadian market, my first priority would be to make sure that it was suitable and attractive in the U.S.

    Mr. Peter Miller (Vice-President, Planning and Regulatory Affairs, CHUM Television): Mr. Abbott, I would like to add to that and situate this in the context of the discussions and meetings you've been having over the last year about the state of the broadcasting system and some of the challenges that have been presented to you in terms of improving local programming and regional programming, challenges facing Canadian drama. I would ask whether adding foreign ownership helps in any way with those challenges.

    I think when we look at it what we are suggesting is in no way would foreign ownership help improve local reflection or local programming, because a foreign media company's interests would be in taking the product they have and trying to amortize it over the Canadian market and extend it as much as possible, not in investing in doing more local reflection or stuff that perhaps is already quite marginal.

    So it really comes down to, I think, and this is challenge the committee has to address, what are the pros and the cons, and are there sufficient pros in foreign ownership to outweigh what are considerable concerns on the other side.

»  (1715)  

    The Vice-Chair (Mr. Paul Bonwick (Simcoe—Grey, Lib.)): Thank you.

    We'll move on to the next question. Thank you, Mr. Abbott.

    Mr. Lincoln apologizes for having to leave early, but he did have a commitment he couldn't get out of. So he's asked me to take on the role of chair for the last part of the meeting. My only condition was that I didn't give up my time to question. Again, Clifford offers his apologies.

    I'd just like to say thank you very much for a very passionate and informative presentation. I don't think you could help but be moved by the passion towards this Canadian culture and the content aspect of it.

    What I would like to do is bring forward a couple of points that have been previously brought forward by different groups and maybe get your perspective on them. I'm thinking of firstly a point that was brought forward about a week ago last Thursday. I was reminded of it by Mr. Amber's very passionate and eloquent address suggesting that Canadians be patriotic with their investments versus going beyond, or foreign investors. I'm thinking about an example that was provided by way of Cineplex-Odeon when it took on that dominant role in the movie-house industry.

    As a Canadian company, we were under the impression it might provide an incredible opportunity for a Canadian-owned company that has a vehicle to deliver Canadian content, Canadian stories, Canadian movies to the Canadian people. In fact quite the opposite took place. Their total allegiance was to the bottom line and Walt Disney and those kinds of things. So I'm wondering if Mr. Amber might address that patriotic sense that the investor in Canada is good, the investor beyond may not be quite so good.

    The second question I would pose is to Mr. Bureau. Do you see any potential benefit, fiscal or cultural, from opening up the foreign ownership limits if we maintain, or perhaps even tighten by way of regulation or law, provisions for Canadian content?

    Mr. Amber, would you like to go first?

    Mr. Arnold Amber: I obviously wasn't here for this presentation, so I'm not quite sure I got the gist of it. Is the question about...?

    The Vice-Chair (Mr. Paul Bonwick): The premise of the previous thing--and all I can deal with is my interpretation--was that the committee perhaps should be not so naive as to think that just because they're Canadians who are investing, versus Americans or people from Britain or Germany, we are going to be more patriotic by way of ensuring there are content provisions beyond regulation for Canadians.

    The premise of the statement was that the loyalty, generally speaking, is to the bottom right-hand corner, regardless of which country it's from. I'm interested in your perspective on that, using Cineplex-Odeon as an example.

    Mr. Arnold Amber: I don't know enough about the film industry to draw that comparison. But in the areas I do know there's no doubt that the responsibility of somebody who runs a business is obviously to the shareholders and so on and to keep the business going. So one does not dismiss a business person from a profit motive.

    However, what changes.... And I think it was illustrated very well by our folks on my left--not left philosophy politically, but on my left in reality today--who talked about the difference when a foreign company comes in. For Canadian entrepreneurs, whether it be in newspapers or some place in broadcasting, this is the house in which they live.

    As it has been noted to you, it's very hard to make product that easily flows across the world. There are a lot of things you have to do. And one of the things you would have to do is keep diminishing partly, as you heard, the regional aspect of it and also to some extent the national ones. In that respect we're better off with the locally grown entrepreneur than the foreign one.

    By definition, the foreign one comes in with their idea of how to do radio, television, newspapers, which is vastly different from ours, I think. So you are better off, because basically the house they live in has parameters around it. There are walls that are peculiarly Canadian. There are rules and regulations, but there's also the fact that this is the only game they're playing.

    I think that without going too much to do a litmus test on whether there are good entrepreneurs or bad entrepreneurs, we are probably much better off with Canadian owned and controlled companies in the media than otherwise.

»  (1720)  

    The Vice-Chair (Mr. Paul Bonwick): Mr. Bureau, if you could shorten it, and then Ms. Gagnon.

    Mr. André Bureau: If I understand the question you formulated, you've asked me if there is any benefit to opening up the ownership rule on the BDU side, provided we maintain the Canadian content rules.

    We are saying that ideally we should maintain the status quo. That's to start with. If you or the government at some point find any benefit to opening up the ownership rules on the telecom, for example, and the BDU side, for whatever reason, because of fairness, because of the lack of liquidity in the markets in Canada, because of the need of these companies to grow and provide good services to Canadian customers, if you were to come to that conclusion.... And frankly, we're not in a position really to make any comment on that at this point in time, as we don't know enough of their plans and of their needs to be able to voice any comment on that, but if you were to be convinced that they need access to that kind of liberalized ownership rules, we're saying it is so risky to go in that direction that you have to take the time to put some safeguards in place.

    We say the minimum safeguard that should be put in place is that if anybody comes in and buys one of the BDUs here in Canada, or two, three, or five of them, the foreign company that acquires the control should have absolutely no interest in any programming service, period. That has to be clear. If they want to come in as a distributor, fine. Well, fine? It's not fine. That's my English.

    We said we would not address that part of the issue, because we don't have the elements to deal with it. But if you were convinced and you believed at the minimum there should be that kind of safeguard that would say a ban on cross-ownership...then I join my friends here on the cross-ownership issues, but we really believe there should be absolutely no interest from the company that acquires a Canadian BDU into some specialty, pay, or conventional television service.

    That doesn't mean that pay, specialty, or conventional television will not have access. They could have foreign investors up to the existing limits, but a different one.

    The Vice-Chair (Mr. Paul Bonwick): Thank you, Monsieur Bureau.

    Madame Gagnon.

[Translation]

    Ms. Christiane Gagnon: Do you not think that the fact that we are dealing with this aspect of the proposals has just paved the way for this to happen?

    I think it is fortunate that the witnesses we have heard in the last two days are unanimous, because when we heard from the representatives of the Association of Cable Companies, they said that there was no link between the container and its contents, and that we were not speaking to the right people regarding the concerns you are raising today.

    But to think that "if, probably, we would have to...", I think it is rather...

»  (1725)  

    Mr. André Bureau: Like opening a door?

    Ms. Christiane Gagnon: Opening the door, but at the same time, being rather pessimistic.

    For example, I know that the debate will go to the Industry Committee, and that the telecommunications companies will be applying pressure to have the restrictions on foreign ownership lifted.

    Do you think that the battle will take place there first? Do you expect pressure will be applied to insure that broadcasting companies...? What leads you to say that there may be...? In any case, your page two is somewhat pessimistic.

    Mr. André Bureau: First of all...

[English]

    The Vice-Chair (Mr. Paul Bonwick): If I can just interrupt for a second, perhaps we can keep the remarks fairly short, because I have two more people who want brief remarks, and we're supposed to adjourn shortly.

[Translation]

    Mr. André Bureau: I would say, Ms. Gagnon, that we drew this conclusion and made this recommendation, not because we favour that or because we are taking for granted that this is something that has been decided and with which we will have to live. Rather, we did so because we realized that we would not be participating in the debate on whether telecommunications and cable companies need this money.

So we are going to stay outside this debate, and once we do that, we think two things could happen: either you say yes, or you say no. If you say yes, this is what we recommend. If you say no, we say that that is the ideal solution. For us, it is the ideal solution, but clearly, we do not want to get into a debate about their needs.

    I would say very frankly that when we prepared our presentation—and we have been working on it for months— there was no question of appearing before the Industry Committee. The issue had not been even been raised. We were coming to see you here, and we wanted to tell you what we thought, because we think you have done some quite outstanding work in the past year in your comprehensive review of the system. We thought this aspect would really be debated by this committee and we wanted to be part of that.

    Ms. Christiane Gagnon: Will you be appearing before the Industry Committee?

    Mr. André Bureau: It is quite possible that we will appear before it as well.

    Ms. Christiane Gagnon: You should do that.

[English]

    The Vice-Chair (Mr. Paul Bonwick): Thank you.

    A small announcement by Ms. Bulte.

    Ms. Sarmite Bulte: I have a follow-up question.

    Mr. Bureau, I understand you said you would not enter into a debate with the cable and telecom companies about their needs. But I think this is not about a question of need any more. It's joining the debate to talk about the consequences.

    In many decisions we have in our lives and as governments, we think there are certain consequences, but there are many unintended consequences. To me this is a very large, blaring, unintended consequence that we are seeing. I think it behooves you to make people aware of it.

    As Mr. MacMillan said, it is disingenuous of us to sit back and say, oh well, if that's what has to happen. It becomes fair here, then it's fair and we're all very fair. But the unintended consequence of what will happen if we open up the telecoms to foreign ownership is the end of us. I would urge you all--please, don't get into the debate, I'm not suggesting you get in the debate about what the needs of the cable and telecom companies are--certainly to consider, not just what the consequences are, but what the unintended consequences will be.

    The Vice-Chair (Mr. Paul Bonwick): Madame Lill.

    Ms. Wendy Lill: Thanks. In a way I regret that foreign ownership and cross-media ownership are being lumped together, because I think that cross-media ownership is far too important to play second fiddle.

    Peter Murdoch was with us a couple of days ago representing CEP and he put forward some very important recommendations that he felt needed to happen in terms of controlling cross-media ownership, basically, breaking up monopolies, putting in place press councils.

    I'd like to ask you this, Mr. Amber, as the president of the Newspaper Guild. What kind of mechanisms are needed now to deconstruct the cross-media juggernaut we are facing?

    Mr. Arnold Amber: Well, one of them is a re-examination by the only part of the government that has any control mechanism at all, and I think rightfully so. This is not a country where we're going to have the government dictating to the newspapers what they should be doing. However, there is through the CRTC. The CRTC has the mechanism, the ability to try to say okay--let's call it company X--you own this, you own that, you own this, let's make a real division between how each of those elements are controlled and how they're run, so that you will never have the occasion when somebody begins to pollute each one through the actions of the other.

    That is the regulatory body that should have done it. They're the ones that, when CTV and CanWest Global came for licence renewal 18 months ago, did not do their work. And that is quite in keeping with the history in Canada.

    If you want to go back and look at the government decision that allowed cross-ownership to exist, as you know, years ago there was actually a change.

    The pressures on the last couple of questions here.... Is there going to be pressure about this foreign issue outside of the country? Sure. There's pressure right now from people trying to get us to relax the foreign ownership things. There was pressure brought years ago to relax the cross-ownership. I think one could stop it now that it exists and make the companies not divest--I think that this again is perhaps an un-Canadian way of looking at it after the horse is out of the barn--but you definitely could decide which horse is in which pasture and make sure they don't keep going to and fro.

»  (1730)  

    The Vice-Chair (Mr. Paul Bonwick): Thank you very much.

    It being 5:30, I want to make a brief announcement Miss Bulte has passed on to me.

    Minister Copps, along with the members of the Canadian Recording Industry Association, is having a reception this evening, and it's certainly very culture-oriented. So we would extend an invitation to both the colleagues and those of you who are witnesses to feel free to attend. It's from 5:30 to 7:30 and it's in 200 West Block, just across the Hill. So please join us for a little fellowship, and some libation and cheeses and what not.

    To close out, thank you again so much for the presentation. It was really well received.

    The meeting is adjourned.