By Irene Berkowitz

Canada’s location next to the U.S. has been a basic building block of our media policy since the earliest days of electronic media. A key question now: should it remain so?

Geography has been considered a key aspect of Canada’s policy framework since the country’s first broadcasting commission in 1929, when The Aird Report bemoaned the popularity of U.S. radio shows, which were already a hit with Canadians on CBC. Since then, proximity to the U.S. has often been perceived as a dire threat to the economics of our media system and even to Canada’s cultural sovereignty.

With the Department of Heritage Broadcasting and Telecommunications Legislative Review Panel’s recommendations set to land January 2020, it seems essential to examine this fundamental policy driver: Canada positioned as U.S. victim.

Is it true? This article will examine whether this assumption has historically been accurate and, most importantly, going forward: should geography factor into a winning policy framework for the global, online era?

A review of the facts reveals a stunning irony: while our policy rhetoric has claimed to protect Canadians from U.S. media, our regulation has depended on Canadian affection for U.S. media, including instruments purposed to generate public funds for Canadian content.

Before we zoom to the present – three quick stories from our policy past:

1952: The Road Not Taken

Our most famous broadcasting inquiry was 1952’s Royal Commission on Canadian Broadcasting, a.k.a. the Massey Commission. History has obscured two salient details. First, the record shows that CTV executive, Ken Cooke, pleaded with the Commission that open competition, not protection, would be the way to strengthen Canadian media. The pleas fell on deaf ears and a protectionist policy direction was established. Was sibling rivalry a contributing factor? The chair, Vincent Massey was the older, reportedly less handsome brother of Raymond Massey, a Hollywood star nominated for an Academy Award for the uber American movie, Abe Lincoln in Illinois. When Vincent tabled his report with its famous line about the American media “invasion,” a fork in our policy road was taken.

1969: The Ant and the Elephant

In 1969, Prime Minister Pierre Trudeau delivered a canonical simile that showed how deeply embedded Massey’s mantra had become. With the U.S. being Canada’s largest trading partner, across the world’s longest peaceful border, his words positioned Canada as a media victim of the U.S., requiring economic and cultural protection from its neighbour. Speaking at the Washington National Press Club, Trudeau famously said: “Living next to the US is like sleeping with an elephant…one is affected by every twitch and grunt.”

1971: AmCon for CanCon

In the same year, at the 1969 Los Angeles TV market, another group of CTV execs needed to attract advertising so the network could survive. There, they conceived a policy innovation that would finance Canadian content for four decades and would be impossible in any other country, convincing CRTC to make simultaneous substitution mandatory and by 1971, reverse a regulation forbidding it. The resultant 30% uptick in revenues gave Canada a broadcast industry and funds to build a world-class production sector. While rhetoric promised to save Canadians from U.S. TV, henceforth, regulation depended on Canadians’ affection for American TV. A sort of “AmCon for CanCon,” if you will.

For the next four decades Canada’s TV industry hummed along like that of the rest of the world, except that we cross-subsidized Canadian content with some of the double-digit profits from broadcast and cable – to produce U.S. style content. Our production sector was employed by countless Hollywood productions. Some of our best Canadian content was purchased by U.S. services. No one minded the paradox. Then: enter creative destruction.

2014: Sounding the three-alarm fire

By 2014, Canada’s first inquiry into the 21st century media, Let’s Talk TV, global TV disruptions were a three-alarm fire to our policy framework: national borders, linear broadcast, and cable delivery were burning (they still are). These three financial pillars of the cross-subsidy framework had never delivered a financially sustainable production sector; with profits dropping, where would the money come from to support Canadian content? Although national media borders were waning as a broadcast business model globally, in Canada this transformation re-ignited the invader metaphor and with it, calls for stronger protection from the U.S.

2019: YouTube challenges the assumption

A new study of YouTube in Canada (Watchtime Canada: How YouTube connects creators and consumers – I am lead author and researcher), challenges the belief that Canadian creators are disadvantaged by living next to the U.S. Research shows that Canadian creators do the reverse: use geography to unique competitive advantage.

Per the chart below (one of 50 data visualizations), Canadians not only create content popular with Canadian viewers (largest audience); they also connect with U.S. viewers (next largest audience) and use resultant revenues to finance more Canadian YouTube content. YouTube content depends on the sole factor that has always powered media survival: audience popularity.

Another chart shows that Canadian YouTube creators seek global audiences. In fact, Canadians lead the platform in global export with 90% of views outside country (platform national average is 50%). On YouTube, global export is instant, free, and highly valued by Canadian creators.

Both Canadian creators and consumers value that YouTube leaps Canada’s walled media garden. Typical of more than 9,000 qualitative data points is this one: “I love using my Canadian creativity to inspire the world.”

Further underscoring consumers’ appreciation of open borders, nearly 90% of Canadian consumers don’t search for Canadian content on YouTube, with typical responses such as “We live in a global world; why restrict yourself to one part of it?”

The report’s key take away observes that YouTube has achieved these results and many more (such as 28,000 Canadian FTEs in 14 years) without a public policy support system (the support being the over $6 billion it costs Google to maintain YouTube and offer it free to creators and consumers).

Most salient however: these results have been achieved in open competition, as the CTV executive first advised in 1952 (although he could never have imagined a global media market). Perhaps protection, not the border, has been the disadvantage? Canadian creators are clearly strong and grow even stronger when they compete for audience popularity.

As Canada considers 21^st century policy, it seems critical to figure out how Canadian creators will best thrive in a global market. Might this mean vanquishing a policy staple of compensating for living next to the U.S.? The facts suggest a critical question: was geography ever the real problem?

Irene S. Berkowitz, PhD (@irenesberkowitz) is FCAD Policy Research Fellow and Instructor in Ted Rogers MBA and RTA School of Media at Ryerson University.