By Irene Berkowitz 

As a government-appointed panel begins its review of the Broadcasting and Telecommunications Acts, the CRTC has suggested one area of focus must be how the Acts can better support the creation of “high-quality Canadian content” that’s discoverable.

But in CRTC’s recent report to Canadian Heritage, Harnessing Change, as well as its December reference document, I was surprised by the analysis of two charts that reveal a weakness in our current English-language drama policy framework.

Together, Harnessing Change‘s Market Insight #20 (Figure 44) and the reference document’s Chart 26 seem significant to forward-going drama policy. 

DECEMBER 7, 2017: Chart 26: Economic Surplus/Shortfall on Canadian TV without Subsidies ($ millions)

MAY 31, 2018: Figure 44: Current levels of Canadian content would not be sustainable without public support

Profit or loss on Canadian content in aggregate by genre, 2006, 2016 and 2017 (English-language market)

Chart 26 is a “what if” thought experiment. It estimates future profit or loss absent all forms of direct public support for Canadian content, not including indirect support such as cross-subsidization. Figure 44, meanwhile, tracks three years of reported revenues across genres. Both charts agree that English-language drama, the most subsidized genre, sustains the largest annual loss, roughly $300 million.

My surprise is rooted in Market Insight #20’s interpretation of Figure 44, which states that English-language drama would not survive without subsidies. I, however, interpret the data differently and see it as an imperative for policy change regarding how subsidies could be awarded to English-language drama.

The CMPA’s 2017 Profile report found that English-language drama comprises about 75% of Canadian drama production ($1.3 of $1.7 billion). Unlike 50 years ago, when our policy framework was designed, today Canada’s drama producers are thriving. Production is booming. Our workforce is world-class. Strength can be attributed, at least partially, to 20th century TV market insights that built our robust workforce and production volume.

However, to me Charts 26 and 44 suggest our “production is king” policy model has not been effective at popularizing Canadian drama. While the highest-rated Canadian dramas gets between 1.2 and 1.5 million viewers, Hollywood dramas can rake in twice as many Canadian eyeballs.

The historic policy rationale for English-language drama was to solve the problem of Canada’s small market with a supply-driven framework (bolster local industry in an effort to compete with the dramas flowing in from the U.S.); it worked. But global disruption has changed the game. Local media markets are going global.

Global demand for English-language drama, TV’s most popular, profitable genre, has never been higher. For example, it helped propel Netflix to 120 million subscribers across 190 countries.

When delivery disruption settles, Canadian drama producers will have the same opportunity as Hollywood: make great content and exploit it globally. One word defines the demand-driven “content is king” business model: popularity.

Canadian English-language drama’s weak market traction was a mystery that my doctoral research found to be rooted in weak development. Moreover, my study suggests the problem is solvable only by real market pressure. Throwing money at development that is “a bridge to nowhere,” as one of my sources referred to Canadian development, won’t help unless financiers need to succeed. Development (R&D) improves when linked to monetization (ROI).

Might CRTC’s interpretation of the data overlook the sole power of market feedback to strengthen development so the drama wins the battle for attention? 

Market Insight #20 and its interpretation of Figure 44 seem to confirm policy as usual. In academic speak, this might be called confirmation bias. It is one of the most troublesome aspects of human reasoning because it suggests our thinking game is fixed. We have a cognitive tendency to interpret evidence to confirm pre-existing conclusions, discount alternative interpretations, and defend established paths.

To win new opportunity in the global, online era, one could argue the data suggests a need for new policy with new purpose: popularity.

How to do this? It likely requires a demand-driven policy instrument. As a conversation starter, I’ve suggested a pilot: a producer-accessed, platform-agnostic, sliding scale matrix that could be used as a market bonus atop our existing point system.

Market Insight #20 might be a case of confirmation bias. The Review panel appointed to modernize the Broadcasting Act needs to consider if our current framework is hampering, not harnessing, Canadian producers’ ability to seize the moment and take our English-language drama to the next level: national and global popularity.

Irene Berkowitz, PhD, is Policy Research Fellow, Ryerson University Faculty of Communication and Design (FCAD) and Instructor, Ted Rogers MBA.