Montreal: Canada’s tv networks are preparing to drop several primetime drama series developed for the 1999/2000 season. Broadcasters will be obliged to make some tough calls in the days and weeks ahead and are being told to key on the essential in light of over 600 funding applications filed with the Canadian Television Fund, information confirmed by both the Canadian Association of Broadcasters and Telefilm Canada.

Telefilm has already received over 300 eip equity applications while more ‘top-up’ apps on the lfp side are expected before the March 15 deadline.

cab says the ballpark ’99/2000 oversubscription rate is already 100%.

cab president Michael McCabe says producers have the capability and broadcasters have the need ‘but the resources in either [eip and lfp] envelope are just not there to meet anything like the demand.’

‘So I think we’ll have a new crisis this spring,’ he says. ‘And you may see the major broadcasters are going to have to make decisions about whether they will drop a series.’

Peter Katadotis, Telefilm Canada director, Canadian operations, says, ‘On our side [for the Feb. 15 eip deadline] we have maybe 50 to 60 more than last year, which is not an enormous amount. There’s no question about it, there will be an oversubscription.’

Ultimately, says Katadotis, the extent of this year’s oversubscription depends on ‘how many big ones we say yes to.’

McCabe says cab members ‘can’t get a grip’ on the overall level of ctf funding for ’99/2000, but the $30-million oversubscription debt from ’98/99 has to be paid back. And with less than 10% or $18 million of ctf funding earmarked for primetime drama on private English tv (6% or $12 million on the French side), McCabe says one of the key ctf objectives is being lost.

Katadotis says ctf’s new operating budget will remain unknown until it’s presented to the board on March 12. ‘We don’t want anybody to know until the board knows,’ he says.

Cancon requirements aside, McCabe says, ‘if we can’t expand our Canadian schedules the way we want to,’ broadcasters will implement ready plans to buy even more off-the-shelf u.s. shows.

‘Someone like ctv [Television Network] really does want to come in with at least 22 [one-hour primetime] episodes, but the fund is saying in effect `only one [per] broadcaster that is over 20 episodes.’ ‘

McCabe says the overall ctf cap for drama ‘kills these series because it takes that long to build an audience. The American competition at that point is running strong, and you have to close down. It’s starting to really hurt, whether it’s DaVinci’s Inquest or Cold Squad.’

According to cab’s president, it’s time to break out of the ctf box.

‘The fund was a godsend when it came but I think what we now have to do is sit down and say, ‘How do we create another $500 million?’

‘I think we can get more public money but we’re going to have to generate more private money in order to lever that public money in,’ he says.

‘If the crtc has the nerve,’ says McCabe, to take on u.s. specialty services which pull in $80 million in annual subscription revenues and hit them with a regulation adding $24 million to a Canadian production fund, then ‘with that kind of money in hand it seems possible to go to the finance minister and say, `Can you match that?’ ‘

Under existing conditions, McCabe says $24 million will trigger an additional $100 million a year in new production – or the equivalent of ‘another major drama series per broadcaster.’

Funding applications on the coproduction side are piling up, too.

Telefilm reports 55 advanced rulings were issued in the first seven weeks of 1999, representing total budgets of $316.3 million. While it’s early on in the coproduction calendar year and more applications will be filed after mip-tv, Telefilm’s numbers point to a growing need for offshore financing, and the prospect of a major hike over 1998 when there were 72 coproductions with combined budgets of $576.1 million.

Deborah Drisdell, Telefilm director, international relations, says she can’t comment on operations issues but many of the ’99 applications are seeking eip funding.

(The eip and lfp coproduction envelopes are capped at $5 million each in ’99/2000. And although lfp’s coprod spending is no longer tied to a 65% Cancon quota, the new cap cuts the ’98 contribution of $9.9 million in half.)

If there’s a corresponding crunch in coproduction, producers think it’ll impact on projects without a trigger-level eip commitment.

Under the revised ctf coproduction guidelines, projects receive 15 lfp points if Telefilm eip has invested $500,000 in the show.

Decode Entertainment partner Steven DeNure says the revised rules mean the eip commitment becomes decisive.

‘With only $5 million, my belief is Telefilm will invest all of that [eip envelope], and if that is the case there will be more than enough projects which have those [bonus] points at Telefilm to completely eat up the available lfp funds. I think what you’ll see is that [from the] coproduction fund, the lfp side will be used almost exclusively by projects that have Telefilm. It will mean that treaty coproductions that don’t are unlikely to get lfp money.’

Asked about the equity impact, Katadotis says, ‘I don’t want to make that speculation at this time.’

While ‘the at-risk money’ in the revised ctf guidelines ‘is seen as a feature of the financing,’ McCabe says ‘in fact, in many cases it is not real.’

McCabe says he can’t confirm the 6% to 9% hike in broadcaster investment in ’99/2000 ctf projects, ‘but certainly broadcaster commitments are up.’

Says McCabe: ‘When I say there’s a new kind of crisis I think we have to not just address the question of renewing the fund but fundamentally go to work together and decide how to get out of the box. We’ve hit a ceiling and we have to figure out how to break through it.’

McCabe says the industry needs a new strategy ‘before next year’s funding crisis.’

‘If we don’t move ahead, we’re going to start sliding backwards.’