Desperate Canadian Networks and the "permanent downturn"

UPDATED: 4:00 p.m. Clarified some language and fixed some typos.

Last Thursday, CBC had its mea culpa invitation to producers event in Studio 41 of the Downtown Broadcast Centre (the building John Doyle so lovingly calls, "Fort Dork.")

Now, aside from the irony that the "please help us" meeting was being had in a studio that they soon won't be able to do anything in (cause they're laying off the crews and support staff that work there) the crowd was a grumbly bunch of Independent Producers there to be skeptical.

I happened to be carrying the copy of Desperate Networks I'd just purchased. Which optically probably didn't look too good, but what are you going to do?

I felt a little sorry for the team of CBC programmers as they stood up and gave their speeches about how CBC was now "open for business" (one wag in the crowd said the whole thing should have been called, "help us not suck.") but to my ears it did seem an earnest and heartfelt attempt to clear the decks and try to chart a new relationship. Everyone on the stage was in a new job. They promised things like "we'll get back to you quickly from now on." And "we'll have contracts to you in two weeks..." (a promise that even the woman who'll be in charge of administering it seemed to be nervous about.)

Then, before they opened the bar and brought out the dead things on sticks, (peanut beef..mmm.) they went to questions from the audience.

And that's where I started to tune out. Because the questions were largely disappointing. They were CBC insider questions about CBC insider topics. The first one was about the CBC "dumbing down" -- a stupid spin that VP Stursberg probably made worse with comments he made a few weeks ago. The room was heavily stacked with documentarians, surprising, I thought, considering that most of the production companies were in Toronto. Or at least I thought they were. There was a lot of defending-my-turf stuff...a bit about diversity this or that, some whingeing about the Documentary channel takeover (seriously, doc people, are you always this whingey?) and then... ummmm... that was it.

Anyway, it was only later, having read Desperate Networks, that I realized just how much is stacked against the programmers not just at CBC, but anywhere in Canada.

Because in the US, everybody knows they need the next hit, and everyone's afraid to take a risk. But that's in a country that celebrates, venerates, and promotes great risk takers who succeed.

Canada is not that country. Canada is one of the most risk averse nations on the planet. Canadians like to debate, and debate, and be cautious, and even more cautious...it's part of the natural national character, partly due to 150 years of watching the lunatics to the south go off half cocked every few years into some Civil War or brouhaha or what have you.

The lesson of Carter's book is that the middle executive who speaks up for a project, and really pushes it, believes in it, tends to ride their way to the top. Is there anyone at CBC or CTV or Global or other Canadian networks willing to be that person? Or is that even relevant here? I mean, before the current shakeup, the people making the calls about what went on the schedule at CBC had been in their jobs for twenty years. People can fail here, and not get fired. People who'd be tossed out on their asses in the US at the slightest complication Jeff Zucker their way through for years.

So I'm not sure that middle exec here can stick their neck out, because I'm not sure there's anywhere to go. Or that it will even be read as a positive thing. (Remember: risk averse.) The problem is, I don't see any better alternative. So the question remains: Is anyone going to stop being quite so Canadian for a second and do what needs to be done to generate a creative hit and make some money?

Anyone?

Bueller?

The Canadian story is actually far more commonly this -- the passage in the book that will doubtless be of most interest to Canadians, who've been hearing a bunch of vague stories for years.

Ladies and gentlemen, how Alliance Atlantis scored CSI:

Everyone involved with CSI had reason to be elated, but the tale took a new twist only two months later. CBS got word that its 50/50 business partner on CSI wanted to pull its investment out of the show. The partner was the Touchstone studio, owned by the Walt Disney Company, which also owned ABC. Moonves immediately smelled a rat....Moonves wasted no time driving home the point, telling the Wall Street Journal, "Any network that expects to get a show from that company is out of their minds."...Disney pulled its money out of the series....That left CBS Productions holding the bag for all the show's cost...Moonves realized he had to look beyond Hollywood -- way beyond, as it happened. He decided to call Peter Sussman, the chief executive at a Canadian production company called Alliance Atlantis. The company had coproduced a sucessful miniseries version of Joan of Arc with CBS the previous year. Moonves pitched Sussman on the value of becoming a partner in a weekly series. His timing, as it often was, was perfect. Sussman had been pondering how to get his company into the series business....Moonves's call offering a half stake in CSI turned out to be the most financially significant conversation Peter Sussman would ever have in his life.

I'll say.

If you have any knowledge of the Canadian TV industry, the above passage is just going to set you howling. Howling because, of course, Alliance Atlantis was very much, very famously IN the series business. Between the merged company and the two separate corporate entities they were before merging (Alliance and Atlantis) these two companies were the biggest producers of series TV in Canada, with credits for all networks, and shows including Cold Squad, Traders, The Associates, Due South, Tekwar, Earth: Final Conflict, The Outer Limits, The Eleventh Hour, Degrassi: The Next Generation and on and on and on.

(I don't know whether to fault Carter for his research here or not. The problem, of course, is when you talk to people at the CEO and Exec level -- you get the CEO or Exec spin. There were huge, huge structural problems in the way Canadian series were financed in the 1990's, and rather than working to fix them, well....keep reading.)

Then, sometime after CSI took off, came this:

What happened, basically, is that Alliance Atlantis took the gift horse they'd been given, the winfall they had not worked for at all, and used it to gut the Canadian industry which had built them up. Yes, it's a business. It's a business that took years and years of Canadian Tax breaks and incentives to produce, build up their company, merge and grow -- and then when they got the easy score, they didn't reinvest. They cashed out.

Worse, they actually salted the earth behind them. In getting out of the series production business, Alliance said that Canadian TV series had entered a "Permanent downturn."

Read that again. Permanent. Downturn. No ideas how to fix it. No desire to try. Risk averse, meet defeatism. But boy, those three CSI shows sure do help the bottom line...

See, the problem here is not that the networks -- and the prodcos -- are Desperate. It's that they're not Desperate enough. Grown fat on subsidy and retransmission of American hits, they do little or nothing to engender the creativity or business that has risk, yes, but could pay off down the road -- if only you find the right formula, the right product, the right show.

Ironically, Alliance Atlantis now makes most of their money by distributing Miramax and New Line stuff here in Canada, and on their stable of specialty channels, for which they receive a steady revenue stream from cable subscriptions, and the benefits of CRTC oversight.

If they ever let in more U.S. channels, or if the flow of subscription fees is threatened by, say, letting consumers choose which channels they want and which they don't want, well, I expect we'll hear from AA about the "permanent downturn in the cable specialty channel business."

The American Network Programmers, for all their skittishness, shortsightedness, and uncertainty, know what business they're in.

And in Canada, they're waiting for the next call from sugar daddy Les.