Production volume for the country in 1995 reached about $1.3 billion overall and, according to the findings of a Playback survey of the industry at large, to which 85 companies responded, $951 million was spent on indigenous, independent production (see chart, p. 23).

Comparatively, in 1994 the same survey indicated $1.1 billion was spent on Canadian production, and that year, Robert Morrice of the Royal Bank of Canada estimated $1.5 billion was spent overall on production domestically. The $400 million discrepancy in both years is created by service deals (and those companies not participating in the survey).

The current climate for producing in Canada has never been more unpredictable and vexatious and neither have the conditions for prosperous enterprise been better.

Looking ahead, the likes of Atlantis Communications, Sullivan Entertainment, Nelvana, Catalyst, Cinar and many other production houses in Canada are anticipating their busiest year ever.

In the service arena, things are booming, and activities such as the rumored $75 million Renni Harlin’s The Long Kiss Good Night has brought to Toronto in the first four months of 1996, are making locations kitties purr across the country.

Looking back over 1995, season one of Cancon series Traders, Wind at My Back, Urgence, Jake and the Kid and Omerta: The Code of Silence rolled and Due South made it into season two without cbs, its season-one trigger.

A handful of domestic feature films were made including Joe’s So Mean to Josephine, Mr. Happy and Le Polygraphe. The bulk of the lot were coventures, such as the Paragon/HandMade Sweet Angel Mine (made with Canada’s Imagex and the u.k.’s Mass Love).

Although these productions found their way to Canadian screens and contributed to 1995’s $951 million, it was despite persistently decreasing domestic licence fees, further local and international media consolidations, fewer government subsidies, a continuing trend in poor theatrical performances, and generally rising production costs.

As Atlantis Films president Seaton McLean comments, it’s a bit of a miracle they got made at all.

Salter Street president Paul Donovan says it’s a fabulous time for producing in this country, provided you adapt. ‘My view is that producers are responding to the new reality or perishing, and the new reality is less government money and what government money there is, is much more market-influenced,’ he says, adding: ‘It’s never been easier. Really, it’s unbelievable.’

While McLean says the production environment is ‘probably as superb as it ever has been,’ he is not shy about the hurdles.

‘Nobody talks about it’

‘What I find curious about this industry, is that you can go to the Geminis, the wift awards and all these industry functions where nobody actually talks about how bad the situation is,’ says McLean, pulling a scenario out of his hat to prove the point.

Consider financing a $2 million to $3 million tv movie in Canada. You’ve got somewhere in the neighborhood of 12 partners, a Canadian broadcast licence (‘which is right there an assumption because they tend to buy American movies,’ says McLean) with a $100,000 fee. The fee is too low to trigger Cable Production Fund monies, the matching Telefilm dollars are a baby step ahead, and the rest has to come from somewhere else. Other domestic funds are added to the pot, but in the end it’s the u.s. – the dominant force, as Telegenic president Michael Kennedy comments – that is crucial.

‘Canada is unlike any other English-speaking entity in the world. Australia, England – if they want to buy a program they can stick it on the shelf, air it this year, next year, whenever. In Canada, everything is 100% time sensitive to what happens south of the border.’

Traders, as McLean points out, is one of the fortunate few to see a significant domestic broadcast commitment (somewhere in the vicinity of one-fourth of the $800,000-per-episode budget from CanWest Global) that renders it free of international pressures (except er ratings) and makes it possible to launch a Canadian product made for Canadian audiences and financed at home.

At the other end of the spectrum, Playback’s survey, when compared with government totals for overall production, shows that Canada’s service industry accounts for about 32% of overall production spending in the country. McLean thinks it’s probably in fact around the 40% mark and, as industry gurus have espoused in the past, he gives credit to the low dollar as the main attraction.

For the productions that straddle service deals and domestic production, such as coventures, Kennedy says there is some interference from federal regulations such as the point system for the upcoming tax credit.

‘Last year, we had a couple of mows where we had to decide between shooting in Canada with Canadian content or in the States, and unfortunately they went to the u.s.,’ says Kennedy. ‘I’m sure the regulating bodies see the benefit of doing productions here. It would be a shame if we can’t continue to support the people who are currently earning their living in this industry.’

The international influence beyond the u.s. is increasingly important, whether through presales, coproductions or sales. Compared to domestic licence fees (which McLean says have dropped from about $300,000 for an hour of primetime drama five years ago to one-third of that today), the problem in the international arena is not so much a dip in the fees but increasing competition, smaller territories and a marketplace that is generally shrinking.

‘More competition’

Kirstine Layfield, senior vp of Paragon International, says, ‘People had thought with the 500-channel universe you would have more outlets. I think if anything, you have more competition. It’s more difficult to sell out there nowadays because there’s a lot of the same product and you have to prove to buyers that you have something different.’

Layfield adds that although the licence fees are lesser overall simply because they cover smaller territories, ‘you do have an opportunity to make more if you can sell all your windows.’

Historically, on the animation front, a lack of domestic broadcast opportunities has not only created an environment for the Nelvana/ Cinar/Family Channel/ytv application for a cartoon channel, but also skewed animation producers’ focus decidedly beyond Canada’s borders.

Cinar vp of animation production and development Cassandra Schafhausen is in good company (with the likes of Michael Hirsh of Nelvana) when she comments on the conditions out there: ‘The universe is strange now, not just for Canadian production but for animation production anywhere because of the consolidation of so many previously individualized broadcasters.’

Despite international obstacles, Cinar production volume increased by $10 million to $35 million from ’94 to ’95.

Another pie Canadian producers are increasingly keen to bite into is u.s. first-run syndication.

Telegenic, which went from $32 million of production in ’94 to $40 million in ’95, has wrapped the final season of Lonesome Dove and is in preproduction on a new series for syndication called Too.

While the syndication market can be highly lucrative, Kennedy notes that things are changing with the expansion of more new networks in the u.s. such as Fox, wb and upn.

‘The u.s. market is absolutely the toughest and the most important element to what we’re doing, and u.s. syndication is unbelievably difficult,’ he says. ‘I think a few years ago when there were three networks and every city had an independent station, that independent station aired whatever it wanted. Now that station has become a Fox affiliate, so he’s airing Fox programmingin addition to that, any independent stations (left) have signed on to either the wb network or upn.

‘The biggest challenge is just that there are so few independent broadcasters out there who have time slots that they can do what they want with.’

The bottom line, says Kennedy, is you have to be flexible and able to try new fronts.

Atlantis, which has landed above the $100 million mark in production volume for the last two years, recently ventured forth into first-run syndication in an unprecedented, aggressive manner with its new series Psi Factor and Sinbad. Is this a flash in the pan or a wave of the future?

Says McLean: ‘The incredible thing about this industry is it doesn’t in any way, shape or form resemble the industry of two years ago, and that didn’t resemble what we had two years before that. The radical changes that have occurred across the board are staggering. Any assumptions of two years ago you can throw out the window, and the assumptions we’re basing things on now won’t apply in two years. It’s scary.’