More producers and broadcasters see the need to get into the interactive space, which is good news, but major private and public funders warn that their capacity to assist them is, as a result, becoming increasingly strained.

‘We’re seeing sheer volumes of applications increasing. We’ll probably cover 40% to 50% in terms of what we’re able to fund with the capacity that we’ve got. If application volumes continue to grow, we may not be able to sustain that,’ said Karen Thorne-Stone, president and CEO of the Ontario Media Development Corporation, speaking on a panel at this week’s nextMEDIA conference in Toronto.

Her outfit’s current offerings include the Interactive Digital Media fund and a tax incentive, and, she added, there is a new intellectual property development fund on the way that will dispense dollars based on a project’s market viability.

The situation is similar at the Bell Broadcast and New Media Fund, which supports TV projects with a complementary interactive component. It awarded production funding to 18 projects last week, turning away about as many. The results indicate producers are thinking more virally.

‘A large number of applications were some form of social networking, across every genre, across every age group – and that’s a big change,’ said Howard Rosen, the fund’s manager of business affairs. ‘Everybody is starting to play in the social networking area.’

One such production is GlassBox Media’s AUX Uncover, which puts music fans on a scavenger hunt leading to a secret concert gig, offering clues on the TV show, online and through social media. Meanwhile, an indie producer on another AUX project, City Sonic, explained from the audience how Nokia came in with a helpful $15,000. That sponsorship tie-in made sense given that show content can be accessed via mobile devices.

Lianne Stewart from YTV’s digital division said she has noted an increase in pitches producers are bringing with sponsors already attached.

‘Just make sure that you check with the broadcaster,’ she advised. ‘Sometimes the broadcaster has deals in place that conflict with where you have set up potential sponsors.’

While both Rosen and Thorne-Stone said they welcome projects that embrace new revenue models, at the Canada Media Fund the jury remains out with its launch set for April 1.

Said Stéphane Cardin, the fund’s VP of policy and stakeholder relations: ‘We have to look at and work out what the appropriate or acceptable levels of sponsorship or other types of third-party financial involvement will be.’