Two years after the crtc shut CanWest and the Craigs out of the Alberta market, broadcasting ceos Izzy Asper and Stuart Craig are back on the bull, pitching for a new regional service with night-and-day applications that are dividing the already beleaguered regional production community.

The quest for a new Alberta service begins July 15, a hearings process in which Craig Broadcasting, owner of Manitoba stations ckx-tv and mdn-tv, will front-line a $14 million commitment to Alberta drama production while CanWest fights to clench national network status in what it’s calling ‘the most significant undertaking in the history of the company.’

It’s silly season in Alberta this summer, with Asper popping up on national media of all types to detail the national network dream while both applicants wine and dine local producers.

But at this point – the ampdc dead, a hard-line government more comfortable with oil and cattle than artists and tax credits, and Jake and the Kid employing more than 100 cast and crew – many producers are taking the fifth instead of supporting or intervening against either applicant.

‘All we have left are licence fees,’ says one. ‘Do I want to be destroyed? Really, it’s damned if you do, damned if you don’t. Only one is going to win and I’m just not willing to go walking on the barbecue.’

Since CanWest first went public with its national plans in January, popular opinion has run that Alberta is a sure thing for the Asper net. With two weeks until the hearings begin, it’s a bigger dogfight than most anticipated.

Fighting to protect its stronghold on the Alberta market and the millions ($14.7 million from itv alone) in revenues it draws from distributing CanWest programming, WIC Western International Communications’ intervention is predictably ballistic, calling the AltaWest proposal ‘the lightest set of promises in comparable applications on record,’ which offers even less by way of benefits than the last ones the commission denied.

Canadian and foreign program expenditures are grabbing the attention of the Directors Guild (Cancon: Craig, $97 million; CanWest, $73 million. Foreign: CanWest, $92 million; Craig, $73 million), which is supporting the Craig app. Gathering steam on the producers’ side is Craig’s A-Channel Drama Fund, a promise of new Alberta-centric production money, with $14 million earmarked for the creation of Alberta mows, miniseries, theatrical films and dramatic productions, and a development fund for Alberta producers running $920,000.

In the package is an $11.8 million commitment to national licence fees over seven years, with Craig in for 20% of the production budget and guaranteeing that it will not take an equity position outside of national rights. Windows are also guaranteed with A-Channel Drama Fund-produced productions airing on a weekly Alberta/ Canada movie night. Perks include free airfare for producers outside of the province to come to Alberta and talk development.

The CanWest proposal puts 17 new hours of local news, sports, and public affairs programming on the table, with new series commitments in the application running to a minimum of 26 new half-hours of kids’ programming per year and ensuring that at least one of the ‘New Producers Series’ produced yearly will come from the West. Its development fund runs $375,000 for the licence term.

CanWest’s investment in Canadian drama can’t be couched simply through new expenditures laid out in this application, says CanWest Global Systems president Jim Sward.

As the only Canadian broadcaster exercising the option to commit to a number of hours in the underserved categories of drama, music and variety, rather than a flat expenditure, CanWest is making a national commitment to air an average of four of its category 7, 8, and 9 hours between 7 p.m. and 11 p.m., 50% of which will be original episodes and surpassing by one hour the crtc’s target of seven hours of Canadian drama and entertainment in primetime by September 2001, four years ahead of the schedule set out in public notice 1995-48.

‘Our commitment is made up of what you do see and what already exists,’ says Sward, adding that CanWest’s entertainment spending is running $12 million for the 1995/96 season, to at least $15 million in ’96/97, and will be a minimum of $17 million in ’97/98 – system-wide, about one-third of the Canadian programming budget.

‘We already have well over 100 hours of primetime original first-run production we’re funding each year. These are not regulatory minimums. These are over and above the regulatory minimum and we’re doing more than what’s required for the purpose of proving we’re capable of meeting the challenge as the largest private sector broadcaster commitment to category 7, 8, 9 programming. It’s a difficult haul,’ says Sward.

Divided loyalties

According to producers, it’s become incredibly difficult to know whether to focus on the microcosm of the flailing Alberta production industry or act to support the big picture development, which may have its own benefits.

It’s a tough situation, says Josh Miller, vp development for Minds Eye Productions in Edmonton.

‘There are advantages to both proposals. If CanWest gets the licence, they’ll move from system to network, and should we successfully sell to them, we’ll have a national window. On the other hand, the Craig application has more incentives for Alberta producers.

‘The big decision is whether consolidation of three or four large broadcasting entities is better than having a number of players with more regional interest. The zeitgeist out here is that we’d probably prefer a more regional layout.’

But Great North president Andy Thomson, who coproduces Jake and The Kid with Nelvana for distribution on the CanWest systems, says giving up the creation of a third national network in favor of a regional licensee would do producers more harm than good in the long run.

‘It may look like I have a vested interest, but I’d say this regardless: what the producers want are national licence fees and options in selling their product, so the consolidation of the broadcasting industry in process is something we should encourage. Baton should get Vancouver, wic in Ontario and CanWest should be welcome in Alberta. If the Craig application is approved, it fragments the market and it closes the door.’

Others are indifferent to how it happens, just so long as more money sinks into the provincial system.

‘Both would be great – any way of having the broadcasters put more money into the system is ideal right now while we’re desperate for some funding alternatives,’ says Mattrix Film and Video Productions’ Matt Palmer, a producer on the Lonesome Dove series.

But Sherry Kozak, former president of the Alberta Motion Picture Industries Association and producer at Missing Link Productions in Calgary, says the concern is that whatever is kick-started has real benefits for regional indies.

‘Frankly, we’re a little bit jaded by promises of regional production that don’t materialize, so I think many are a little leery of supporting anybody. I guess we’re just bitter, twisted producers. New stations tend to concentrate on news. We’re not doing that. Both have significant monies for the work we do, but we need to figure out how much of it will be truly regional and how much will be from other parts of Canada and set up here to trigger the federal funds.’

Targets questioned

While the Drama Fund is raising interest, many point out that the Craig’s projected target – the equivalent of 40 new two-hour films with an average budget of $1.5 million produced in the seven-year licence term – is unrealistic.

‘As a producer, I’m terribly excited about anybody who wants to give me $2 million a year, but based on a 20% licence fee for a $1.5 million mow, that’s spending $300,000 per movie to make seven movies a year.

Where is the rest of the money going to come from? Telefilm would have to reserve their entire English-language private broadcaster envelope just for the province of Alberta,’ says Thomson.

Palmer adds that an international sale of movies at the low end of the budget spectrum may be difficult when the competition is a whack of $2.5 million and $3 million productions from Alliance and Atlantis.

‘In order to get the talent you’re going to need to pull in the international sales, $1.5 million would be difficult. There’s got to be some realism on the part of the broadcasters. It all helps in the long run for the producers to get some more experience, but it’s a business as well as an art and that has to be taken into account.’

But A-Channel executive vp Drew Craig says the balance of the budgets will be made up with ‘other coproduction agreements and foreign sales,’ with the magic 20% triggering Telefilm financing and the Cable Production Fund.

‘I think whether it’s doable depends on who you talk to. The $1.5 million is an average not an absolute, so some productions may be bigger and some smaller. Plus, the sub-licence money we get back from selling the product to other Canadian broadcasters will get rolled back into the fund, which could build the pool to draw from.’

Protecting the integrity of the established broadcasters seems one area in which there’s general agreement amongst most of the producers, in part because while the cftpa revs up the lobby effort for an income tax credit modeled on the Ontario system, there are only broadcast licence fees to generate production.

The potential impact on the status quo needs to be addressed, says Fe Wills, president of Calgary-based Aardvark & Pretzel Productions. wic is projecting a loss of $38 million on Cancon spending in Alberta over the seven-year licence term if CanWest nails the territory, and the whiff of any spending reduction on the part of the local broadcasters is frightening, she says.

Most programming dollars are based on a percentage of revenue, and if those monies go down, so do the available production dollars, Wills surmises. ‘I’d love to be able to get pre-licence fees out of more than one station in the local marketplace,’ says her intervention. ‘But that is not the reality.’

For its part, the cftpa is stressing that the commission carefully examine claims from local licensees that a new player in the market will threaten their ability to meet programming commitments, and that any new licensee ‘should be expected to make Canadian programming commitments that commensurate with their overall revenue base.’

Based in Calgary, the hearing is scheduled to last a week.