Whether there exists a conflict of undue preference when a broadcaster moves into the realm of distribution, and vice versa, is a question that does not seem to be occupying the crtc much these days and is certainly not inhibiting the deal-making of one CanWest Entertainment.

In late July, the entertainment division of the third most powerful Canadian broadcaster – and now the country’s most endowed media giant – struck a $146-million deal with Dutch tv giant Endemol Entertainment to buy its international distribution unit, effectively doubling the size of CanWest Entertainment’s library and positioning the company as Canada’s number one tv distributor.

‘The Endemol acquisition will contribute to a substantial growth in revenues, operating profits and net earnings at CanWest Entertainment for fiscal 2001 and beyond,’ says CanWest Entertainment ceo Jay Firestone.

(Endemol, creator of the cbs reality-based series Big Brother, is in the process of being bought out by Spanish telecom giant Telefonica in a deal worth $6.6 billion.)

Endemol International Distribution, whose library holds 600 hours of tv programming, including Beastmaster, Psi Factor and ctv’s canceled series Cold Squad, will be folded into Fireworks International, CanWest Entertainment’s international tv distribution arm, headquartered in London, u.k.

In addition to gaining distribution rights to the existing library, CanWest Entertainment will also have the first rights to acquire all the available distribution rights to future tv programs produced by Endemol Entertainment in the next year and will assume Endemol’s existing program acquisition commitments.

‘[The Endemol deal] puts Fireworks up into another league. They’ve gone from being a mid-sized player to the biggest in Canada,’ says William Alexander, president of Toronto-based distrib Critical Mass Releasing. But while Alexander acknowledges that ‘everybody’s trying to grow for the global market,’ he sees big opportunity for the relatively small player. ‘[The big guys] will be focusing on mass distribution, leaving smaller markets, smaller projects, independent talent open for the smaller distributors.’

CAB lobbying

On the political side, however, the Canadian Association of Broadcasters has been lobbying for private broadcasters to have the right to own, produce and distribute content. In a speech made in early May, cab president and ceo Michael McCabe went so far as to say that if the market was completely open to broadcaster/distributors, they could inject upwards of $30 million in new money for projects supported by the ctf, a 30% increase in the current level of financing available from the Canadian distribution sector.

However, ‘if broadcasters get public funding, then why do we need independent producers?’ asks Canadian Association of Film Distributors and Exporters president Richard Paradis, in a sentiment echoed by the production community.

‘When someone can distribute and have the power to greenlight a project, it brings up the question of safeguards,’ says cftpa president and ceo Elizabeth McDonald. However, in the new media environment, McDonald concedes, ‘we have to be open.’ While self-dealing, and hence undue preference, remains an issue for producers, the association is willing to accept, for example, CanWest distributing for a cbc-triggered production.

Meantime, CanWest Entertainment serves as the paradigm for the kind of integrated media company the broadcast community is looking to parallel, said Corus Entertainment president and ceo John Cassaday, following a McCabe-like address to the Empire Club in May.

In other, brand-identification news, CanWest Entertainment is consolidating its international and domestic distribution subsidiaries, Seven Arts International and CanWest Films, into a new company called Fireworks Pictures.

Firestone and Seven Arts president Daniel Diamond will assume the same titles, and CanWest Films vp Robert Aaronson will become vp acquisitions and coproduction at the new entity.

CanWest Entertainment’s Beverly Hills office will house Fireworks Pictures and the company’s tv arm Fireworks Entertainment. *

-www.canwestglobal.com