Broadcaster,  11/7/2006


Stursberg Speaks on 'Need for a Robust Canadian English Television Service'

Richard Stursberg, Executive Vice-President, CBC Television addressed the Economic Club of Toronto luncheon today.

Stursberg's speech was on 'The Need for a Robust Canadian English Television Service'......

"The CBC plays many roles in the public life of our country. It provides Canadians with news and current affairs programs of the highest quality, runs the country's number one news and information Web site, is the home of the most iconic sports property in Canada Don Cherry and makes the largest Canadian entertainment offer on television. Today I want to focus on entertainment because it is the area where our greatest challenge lies.

Television remains the most pervasive, most popular medium, and it is still a nightly destination for more than 90% of Canadians. While English Canadians enjoy more choice in television programming than almost anyone else in the world, millions of Canadians tune in weekly to foreign essentially American content. The result is that English Canadians are the only people in the industrialized world who seem to prefer the content of another country to their own. We believe this is the most important cultural challenge facing English Canada. There is nothing wrong with the programming they are watching in such large numbers. In fact, much American programming has never been better it is beautifully produced, written and acted. But it has nothing to do with our Canadian life, values, mores and culture. Reflecting Canadians' needs, perspectives, sensibilities or sense of humour is not of course the priority of American producers. English Canadians read English Canadian newspapers, they go to Canadian rock and hip hop concerts, they read Canadian novels, they buy the records of Canadian artists and in theatre, dance and classical performance, we have our global stars and we rave about them. But when it comes to the most popular forms of narrative - television and feature films - Canadians overwhelmingly prefer the stories of another country. Canada has yet to make a real breakthrough in terms of drawing more Canadians on a consistent basis to see our own stories and talents brought to life on the small screen. While drama itself is the most popular category of prime-time programming it accounts for more than half of our screen time Canadian drama accounts for only 9 per cent of screen time and 5 per cent of viewers. This we believe is the fundamental cultural challenge facing English Canada. Television is the most important and influential of all the mass media. Television can bring our stories and perspectives more powerfully to more Canadians than books, dance, theatre or newspapers. So, the central challenge for CBC television is simply stated: To make more Canadian programming that more Canadians actually want to watch. This is the focus of our efforts at CBC Television and it is what I want to talk about today.

As with any strategy, we start with a clear objective, simply stated:

We want to make more programming by, for and about Canadians, that really connects with more of the country's diverse range of citizens.
There is growing acceptance that our programming must be entertaining and fun as well as intelligent, interesting and engaging. Public service broadcasting can no longer be - as the UK Government White Paper on the BBC says and I quote - "confined to the 'worthy'. Indeed, in most cases [a public broadcaster's] output will achieve its maximum impact and its public policy goals only by entertaining its viewers and listeners." End quote.
And the CBC is the only national network broadcaster in English Canada that is in any position to be able to do that effectively with Canadian material. The schedules of CTV, Global and CHUM are overwhelmingly populated in deep prime time, with U.S. shows. They can't get out of that. That's their business model. If they were to attempt to Canadianize their schedules, they would completely destroy the economics of their business.

The CBC is the only broadcaster where deep prime time from 8 to 11 p.m. Monday to Friday is actually available for Canadian shows. So what is CBC Television's programming renewal strategy? We started with the sure knowledge that when Canadians are offered Canadian programming that is done well they will respond with enthusiasm and in large numbers. Programs like H20, Shattered City, our comedy stalwarts The Rick Mercer Report, This Hour has 22 Minutes and Air Farce, Trudeau, Canada: A People's History, and yes, Corner Gas all have done exceptionally well. Canadians will watch homegrown programming when it is beautifully made, engaging, and designed for them, when it is rooted in their sense of humour, their values, their lives and their history. English Canadians are the same as television viewers throughout the world whether in France, Germany, Australia or the United States if they are offered wonderful shows that speak to them, they will embrace them. Any strategy must aim to make quality Canadian programs more regularly and densely available in prime time, when Canadians are actually sitting down to watch television.
We've taken four key steps to do that. First we analyzed our offer in prime time. We want CBC Television to be the place Canadians turn for the best Canadian programming. But it's hard to build that loyalty when you don't give them a reason to come back night after night, week after week.
We concluded that we had too many specials and mini-series. It's hard to build loyalty with them and they are not typically what English Canadians prefer. So now we are populating our prime time schedule with longer running series series keep people coming back to the network, build loyalty and allow us to optimize our promotion. Our strategy is to ensure that Canadian drama and entertainment is more densely available in real prime time, in order to build the category as a whole. We want to create an opportunity to build critical mass, to create a sense of excitement and momentum, and dare we say it to lay the basis for the creation of an English Canadian star system. That's why we are expanding the number of hours of Canadian entertainment programming that's dramas, comedies, and factual entertainment. This year we'll offer 191 hours up from 150 last year building we hope to 250 hours over the next two years. Second we executed the largest audience segmentation study ever undertaken for English television in Canada. It has taught us a lot about the different tastes and interests of Canadians. In turn we can use that information to determine what kind of programming appeals to different Canadians, and where we need to put that programming on our schedule to make sure that they are available to watch it when it's on. The research has also informed our development process and we now do more program piloting and audience testing to refine concepts. We do more research. In short, we try to get it right before we bring a program to air. Third, we hired a new executive team. You can only succeed in this business if you have the most creative and talented people, and I believe we do. We hired Kirstine Layfield our smart new executive director of network programming. We convinced Fred Fuchs, former head of Francis Ford Coppola's American Zoetrope, to come on board and head our arts and entertainment group. Mark Starowicz, the dean of Canadian documentaries is now head of the CBC's documentary unit. He produced the most popular historic series ever, Canada: A People's History, and recently received the Governor General's performing arts award. And we've built a new factual entertainment group under Julie Bristow, the former head of Current Affairs at CBC, who did such a brilliant job reinvigorating the fifth estate which drew 800,000 viewers two weeks ago. Finally, since our schedule is our shelf space like any good manager a prime tactic was to go to our suppliers the independent producers who we count on to develop the product to explain much more clearly than we ever had what we needed. We criss-crossed the country this summer, and met more than 1,600 independent producers face to face. We told them for the first time clearly what we were looking for. We streamlined our procedures to try and make us easier to deal with. And we explained that the more successful and appealing the programs they produce for us, the larger the audiences, the better the revenue, the more we can produce a virtuous circle.

So how are we doing? It's important to remember the long business cycles in television. Renewal is not achieved quickly or easily. For instance, the current schedule includes programs that were green lit three years ago. New program ideas that conform to our current strategy will not see air for a couple of years. This is the nature of television: from the time the idea for a new series is born to its' airing on screen, a number of years can often pass.

Nevertheless, we are pleased with the way things are going. I'm happy to report that our share in prime time this season is about on par with where we were last year at this time. In fact, we have some real success stories. The newly formed comedy combo of the Rick Mercer Report (over 1.5 million viewers) and This Hour Has 22 Minutes has beaten its U.S. competition on CTV and Global every week since its debut this fall. Returning shows, such as the fifth estate (which had the highest rated episode last week in over a year), Air Farce, The National, and CBC News: Sunday, have come back strong with good overall numbers. I'm sure you've seen the low performance of some new U.S. series. It's a tough fall for all new shows everywhere those who follow these things know about the churn in debuting new series on US and other Canadian networks. You may have read recently that 12 of the 16 major new prime time shows on US networks have not achieved ratings success. But our new series Intelligence debuted higher than the debut of Da Vinci's City Hall. Dragon's Den which I hope some of you business people in the audience are enjoying, has had the biggest increase of viewers week to week. And CBC Kids has had a great resurgence in viewers with its new lineup.

But, let's not be under any illusions: we have a steep hill to climb if we are to achieve what are admittedly ambitious goals for English television.
We are in the toughest competitive television environment in the world. In just about every hour of prime time we are up against not only the best shows in the world on US television, but on the so-called Canadian networks as well. CTV, Global and CHUM buy killer shows that are running simultaneously on the US networks -- and for which they can charge top advertising rates. The economic realities of creating Canadian product that is competitive are brutal. Let me walk you through them: Say we want to buy an hour of high-end dramatic programming right now. We can buy the rights to a sensational, beautifully made American program that could have cost in excess of $3 million to produce for approximately $200,000 per hour and make more than $425,000 in ad revenue per hour. An hour of Canadian programming which will be judged against the production values and standards of American programs is going to cost anywhere from $1 million to $2 million per hour to produce. Because of the relative performance of the programs and believe me we do not pretend we can get the 4 million viewers that CSI gets we can recover by way of revenue, between $120,000 to $150,000. Filling this financing gap is a huge problem, despite the existence of tax credits and the Canadian Television Fund. There's a promotional gap too. The immense promotion the US shows and their stars get in the USA, spills seamlessly into Canada from the flood of US magazines, TV shows and chatter. So how do we find the money to produce and promote the high quality Canadian entertainment programming I've been talking about for the last 20 minutes? English television now costs about $580 million in total, which includes Newsworld. Of that, about $275 million would comes from the public subsidy, and about $305 million comes from earned revenue. In other words, about 55 per cent of our total revenue is earned and about 45 per cent actually comes from government. So the thing is that although we are the public broadcaster, we must rely on private revenue for more than half our budget. Indeed our revenues from public sources have fallen significantly over the last 10 years. We are in English television alone down approximately $80 million in government subsidy compared to where we were in 1996, which is almost a third of our current appropriation. I know it's not popular to bemoan the low level of public support for the public broadcaster in this country. But it is interesting to note that Canada stands third last just ahead of New Zealand and the US in the lowest rank of per capita taxpayer support at $33.00, less than a third of the $124 per capita the BBC gets. France, Germany and Italy, all of which have intensely vibrant national cultures and are under no cultural pressure from the USA, spend an average of $81 per capita on public broadcasting. There is to me a further irony in the fact that while the country's so-called private broadcasters not only benefit from the overwhelming economic advantages of filling their schedules with US products, they also receive significant public support through a host of regulatory and tax advantages. Among other things they enjoy simultaneous substitution support, which requires the cable companies to overlay their signals on the US channels if they are showing the same program at the same time. They benefit from C-58, which disallows advertising expenses deductions for tax purposes if the expense is incurred on border stations. They have recently been allowed to add two more minutes of advertising time to their US shows. Collectively these public preferences are worth a considerable amount of money to the so-called private broadcasters. Nordicity, the economic consulting firm specializing in broadcasting, estimated that simultaneous substitution and C-58 alone were worth between $270 and 330 million dollars. Adding in the extra advertising minutes increases the value of the preferences to almost $400 million. This is a number that significantly dwarfs the $275 million we receive from the government. It is important to note that these preferences are over and above the private sectors access to the television production service tax credits, which are worth roughly $140 million in subsidies to them. And as well they take 63% of the Canadian Television Fund, which provides them with almost another $165 million in cash support.

CBC English television simply must succeed. We cannot continue to allow ourselves to be in the culturally unenviable position of having our fellow citizens overwhelmingly prefer foreign fare. But above and beyond the cultural imperative, there are important economic benefits. In practical terms, here's what that means: CBC Television invests more than $80 million in various programs dramas, comedies, documentaries which in turn generates more than $300 million in production with Canada's independent production community. That's a huge investment in Canadian creative talent of all kinds, an investment that would not happen without us.
And we invest in areas largely ignored by other Canadian broadcasters for instance in adapting Canadian literary works for television. We are committed to bringing to CBC Television, and to its audiences, Canada's most compelling literary works. For this year and next the list is impressive. We are adapting such favourite Canadian works as Margaret Atwood's The Robber Bride, Guy Vanderhaeghe's The Englishman's Boy, Mordecai Richler's St. Urbain's Horseman and Barney's Version and Douglas Coupland's JPod. CBC's national English services are strong and essential partners with our major creative and cultural institutions sustaining and funding talent and providing effective channels for all Canadians to enjoy and appreciate the output of our best performers, writers and creators. This is done Monday through Friday in prime time when the choice is CBC or American period. It would be difficult to overstate the cultural impact in English Canada of a service which alone provides us in prime time with laughter (Rick Mercer, Air Farce, This Hour), compelling Canadian drama (Intelligence) riveting and informative experiences of events and situations which formed who we are (Trudeau, October 1970, Levesque). And of course, in the morning hours we alone provide wall-to-wall quality children's' programming overwhelmingly Canadian and all of it commercial free. Sports too play a unique role in that, whether it is amateur sports or professional sports. Hockey Night in Canada is the oldest program at the CBC; it pre-dates television. The fact is that Hockey Night in Canada is not just sports programming it also plays the role of "rassembleur" as the French like to say. That is, it brings us together and forms an important part of our national dialogue. Anyone who disputes the nation-binding power of a hockey game should pay closer attention. You will never hear our anthem cheered or sung more loudly than at the start of a hockey game.

And CBC has leveraged Canada's love affair with the national sport into drama series like the Canada Russia 72 series that attracted a million viewers. If you think we are on a mission to protect and enhance the sense of ourselves that only Canadian television produced for Canadians can provide you are right. We are!

During the second week of October, 15 million Canadians were entertained, captivated and informed by their own Canadian programming on CBC. These are Canadian eyeballs that were not absorbing US content on all the other networks. We're the best cultural investment Canada can make, we are an amazing force in reinforcing our Canadian identity, our collective voice and experience. But success requires that we take risks. And that means that at times we will fail. We know that programs and platforms will fail and that some ideas will not work, but if we are to remain relevant to Canadians all Canadians we must put their needs and interests first, listen to them and try new things. If we succeed Canadians will recognize CBC as the source of the best, most informative, enlightening and entertaining programming by, for and about Canadians.

And I will not be shy in saying that I believe Canada will be the better for it. Wish us luck thank you".

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