Basically, what's happening right now is that Producers are trying to set down rights sharing agreements with the Broadcasters -- specifically in the area of new media.
Through other decisions, notably by allowing the mergers that eliminated first Craig, then Chum, then Alliance Atlantis as independent broadcast entities, the CRTC has created a powerful class of broadcaster goliaths who seemingly can call all the shots in dictating what they require from a Producer to make a sale.
Producers in the last few years have seen the demands from channels increase: webisodes, various rights and ancillary materials are being requested for a shrinking pot of money. It's made the margins Producers have to exploit their wares razor thin.
There's other stuff going on behind the scenes, too. Did you know, for instance, that Canadian broadcasters put less of their own money into license fees than just about any other commissioning broadcaster in the world? It's true. In some cases these days it's dropped to less than thirty percent of the budget. I'm sure somebody somewhere has the details from country to country -- but the last time I saw them they were astounding.
Anyway, this fight right now is why the CFTPA and the corresponding Quebec union gave Writers a good deal on the 1 year extension of our IPA.
A backgrounder on the "terms of trade" negotiations is available here. An excerpt:
Last week, various unions and guilds representing professional performers, directors and screenwriters wasted no time throwing their "strong support" behind Mayson and his team.
"We support the independent producers' position that equitable terms of trade agreements are needed to secure fairer deals for program rights," stated Stephen Waddell, national executive director of ACTRA.
"Reaching fair terms for granting rights is a struggle with which we are familiar."
Brian Anthony, national executive director of the Directors Guild of Canada, said terms of trade deals are key to ensuring the production sector continues to have sufficient "financial capacity."
The framework agreements, they added in a joint statement, would help diminish "severe imbalances in negotiating power" caused by a wave of mega-mergers in the broadcasting sector in recent years.
Notable transactions include the $2.3 billion acquisition of Alliance Atlantis Communications Inc. by CanWest and United States investment bank Goldman Sachs & Co. There was also CTVglobemedia's $1.4 billion takeover of CHUM Ltd. and a subsequent deal under which Rogers Media Inc. bought five Citytv television stations from CTVglobemedia for $375 million.
Maureen Parker, executive director of the Writers Guild of Canada, suggested that broadcasters have become the "gatekeepers" of Canadian programming.
"This in itself gives them powerful leverage when dealing with producers, and the imbalance of negotiating power has only been exacerbated by the broadcaster mergers of recent years," she said.
"If producers are pressured into granting broadcasters program rights for little or nothing, screenwriters and the creative community are impoverished as a result."
5 comments:
Network license fees represent between 22.5% to 30% of a Canadian drama budget. This is the lowest amount paid in the English-speaking world. Canada has traditionally been in this position of last place.
And that number is for CTF shows only. The Canadian networks have no threshold fee for non-CTF shows and come in for 10% or so on CanCon dramas.
What's the old saying - you get what you pay for?
How do Canadian network license fees compare with Australian ones? The Canadian English-language domestic market is only about 8% of the US one.
There was a gathering of numbers some years ago when the Cdn nets were paying 18% in license fees and the next lowest was 36% which I think was Australia. Someone else might have a better memory than I. I think these days the license fees are around 60-80% of the budget. Of course here if you include the CTF money I think you end up with about 65% of the budget. When you add tax credits to the budget the producer is usually facing a minimum of 20% gap in financing and foreign is only good for 4-10% of the budget. But remember, that if the network does not use CTF money, they take foreign.
Enough to make you crazy.
Deb is right...not just about her numbers, but also the 'make you crazy' part.
And I can hear Denis already:
"Have we come far at all? Is there progress? Is it a growing pain? Are things better or worse? And what the fuck is the next step? Don't tell me "don't fight city hall," because that seems to have been the strategy of the last 20 years and that hasn't gone aces, either. why has no one said anything about this up til now? What is with the fucking silence?
What does it take to rouse you people?"
When you feel powerless to begin with and still question the low license fees and get told to "take it or leave it because we don't REALLY need or want your domestic show and can find 5 other shows that will take that low fee"...'shrugs'...
Enough to make you crazy indeed.
Not sure if you guys are following the shenanigans of late between the the CFTPA and the major broadcast groups. To widen the variance in deals and rights granted, the CFTPA intended to negotiate a minimum standard of terms of trade with each broadcast group ... if you as a producer could better your deal, great, but it was supposed to set at least a benchmark. The broadcasters have banded together and refuse to negotiate as individual companies and are instead insisting on one common terms of trade agreement for each genre. Quite unfair given the very different financial and business situations at each network. I know it will probably be unpopular to say, but the producers are getting squeezed even harder than writers and if they don't get some support, the pain is just gonna trickle down the line. I'm already hearing bad bad stuff about CanWest demanding a 50/50 back end split and not even allowing enough margin in distribution and expenses to get yourself a decent international distributor.
With regard to Australia, they have a similar system to us ... not quite tax credits but a tax based scheme. Inherent difference is that Aussie shows consistently outperform most foreign ones so the broadcasters can justify spending big dollars on them because they get viewers and ergo advertisers. When last I checked, broadcasters were kicking in 40-70% of budget, averaging 50%. With tax kickback and a small (10-20% worldwide) distribution advance, you are pretty much at budget there.
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