2008 Economic Report on Film & TV Industry in Canada

Profile 2008

– An Econom

ic Report on the C

anadian Film

and Television Production Industry

Pro

fil 2

008

– R

appo

rt é

cono

miq

ue s

ur la

pro

duct

ion

ciné

mat

ogra

phiq

ue e

t té

lévi

suel

le a

u C

anad

a

1

Produced by the CFTPA and the APFTQ,

in conjunction with the Department of

Canadian Heritage.

Production facts and fi gures prepared

by Nordicity Group Ltd.

An Economic Report on the Canadian Film

and Television Industry

An Economic Report on the Canadian Film and Television Production Industry

2 Profi le 2008

Nordicity Group Ltd.

Peter Lyman, Senior PartnerDustin Chodorowicz, DirectorTerry Wills, Manager

Nordicity Group Ltd. (www.nordicity.com) is the pre-eminent Canadian consulting fi rm providing business strategy and policy analysis to the media/entertainment, culture/content and telecommunications sectors. Nordicity consultants provide clients with strategic planning, business case analysis, market assessment and forecasting, economic analysis, fi nancial modelling, evaluation frameworks, and other tools for strategic and operational decision making.

The Department of Canadian Heritage contributed to the funding of this report. Its content represents the opinions of the authors and does not necessarily represent the policies or the views of the Department of Canadian Heritage or of the Government of Canada.

Ottawa

151 Slater Street, Suite 902 Ottawa, ON K1P 5H3

Tel: 800-656-7440 (Canada only)/613-233-1444 Fax: 613-233-0073Email: [email protected]

Toronto

160 John Street, 5th FloorToronto, ON M5V 2E5

Tel: 800-267-8208 (Canada only)/416-304-0280Fax: 416-304-0499Email: [email protected]

Vancouver

736 Granville Street, Suite 600Vancouver, BC V6Z 1G3

Tel: 866-390-7639 (Canada only)/ 604-682-8619Fax: 604-684-9294Email: [email protected]

1450 City Councillors, Suite 1030Montréal, QC H3A 2E6

Tel: 514-397-8600Fax: 514-392-0232Email: [email protected]

Lynn ForanManager,Film and Video Policy and Programs

Lisanne LegrosResearch Analyst,Film and Video Policy and Programs

At the Department of Canadian Heritage:

15 Eddy Street Gatineau, QC K1A 0M5

Tel: 866-811-0055/ 819-997-0055 TTY/TDD: 819-997-3123 www.canadianheritage.gc.ca

At the CFTPA:

Guy MaysonPresident and CEO

Susanne VaasVice-president, Business Affairs

At the APFTQ:

Claire SamsonPresident and CEO

Céline PelletierDirector of Communications

Profile 2008 is published by the Canadian

Film and Television Production Association.

The report is the result of a collaboration

between the CFTPA, l’Association des

producteurs de films et de télévision du Québec,

and the Department of Canadian Heritage.


Profi le 2008 33

Contents

1 Introduction 13

2 National Indicators 14

2.1 Volume of Production 152.2 GDP 172.3 Employment 172.4 Export Value 182.5 Production by Province 18

3 Canadian Production 20

3.1 Total Canadian Production 213.1.1 Volume 213.1.2 Employment 223.1.3 Language 233.1.4 Genres 233.1.5 Production by Province 323.1.6 Financing 323.1.7 Treaty Co-production 33

3.2 Television Production 353.2.1 Volume 36 3.2.2 Employment 373.2.3 Types 373.2.4 Genres 383.2.5 Trends in Budgets 403.2.6 Language 413.2.7 Content Points 443.2.8 Production by Province 453.2.9 Financing 453.2.10 Broadcaster Spending 493.2.11 Canadian Television Fund 513.2.12 Treaty Co-Production 543.2.13 Audiences 56

3.3 Theatrical Production 583.3.1 Volume 583.3.2 Employment 603.3.3 Language 603.3.4 Genres 613.3.5 Trends in Budgets 623.3.6 Production by Province 643.3.7 Financing 643.3.8 Canada Feature Film Fund 653.3.9 Treaty Co-Production 673.3.10 National Box Offi ce Trends 683.3.11 Box Offi ce Trends of Canadian Films, by Linguistic Market 693.3.12 Top Films, by Language of Presentation 71

4 Foreign Location Production 72

4.1 Volume 734.2 Employment 744.3 Production by Province 744.4 Types 76

5 Broadcaster In-House Production 78

5.1 Volume 795.2 Segments 795.3 Employment 805.4 Production by Province 81

Key Statistics on the Canadian Film and Television Market 82


4 Profi le 2008

Exhibits

Section 2

Exhibit 2 - 1 Total volume of fi lm and television production in Canada 16Exhibit 2 - 2 Total volume of fi lm and television production in Canada, share by segment, 2006/07 16Exhibit 2 - 3 Average annual real GDP growth by industry, 1998 to 2006 17Exhibit 2 - 4 Number of full-time equivalent jobs (FTEs) in fi lm and television production in Canada 17Exhibit 2 - 5 Export value of fi lm and television production in Canada 18Exhibit 2 - 6 Volume of fi lm and television production in Canada, by province 19Exhibit 2 - 7 Share of total volume of production in Canada, by province, 2006/07 19Exhibit 2 - 8 Total direct and indirect full-time equivalent jobs (FTEs) generated by fi lm and television production in Canada, by province 19

Section 3

Exhibit 3 - 1 Total volume of Canadian production 22Exhibit 3 - 2 Number of full-time equivalent jobs (FTEs) in Canadian production 22Exhibit 3 - 3 Volume of Canadian production, by language 23Exhibit 3 - 4 Total volume of fi ction production 24Exhibit 3 - 5 Volume of fi ction production, by language, 2006/07 24Exhibit 3 - 6 Number and share of fi ction projects, by type, 2006/07 24Exhibit 3 - 7 Total volume of children’s and youth production 25Exhibit 3 - 8 Volume of children’s and youth production, by language, 2006/07 26Exhibit 3 - 9 Volume of children’s and youth production, by language and format 26Exhibit 3 - 10 Number and share of children’s and youth projects, by type, 2006/07 26Exhibit 3 - 11 Total volume of Canadian animation production 27Exhibit 3 - 12 Total number of hours of Canadian animation production 27Exhibit 3 - 13 Total volume of documentary production 28Exhibit 3 - 14 Volume of documentary production, by language, 2006/07 29Exhibit 3 - 15 Number and share of documentary projects, by type, 2006/07 29Exhibit 3 - 16 Total volume of variety and performing arts production 30Exhibit 3 - 17 Volume of variety and performing arts production, by language, 2006/07 31Exhibit 3 - 18 Number and share of variety and performing arts projects, by type, 2006/07 31Exhibit 3 - 19 Volume of Canadian production, by province 32Exhibit 3 - 20 Sources of fi nancing for Canadian production, 2006/07 33Exhibit 3 - 21 Total volume of treaty co-production with Canada 34Exhibit 3 - 22 Total volume of bipartite treaty co-production with Canada, by partner country, 2006 34Exhibit 3 - 23 Total volume of multipartite treaty co-production with Canada, by partner country, 2006 34Exhibit 3 - 24 Total volume of Canadian television production 36Exhibit 3 - 25 Total hours of Canadian television production 36Exhibit 3 - 26 Number of full-time equivalent jobs (FTEs) in Canadian television production 37Exhibit 3 - 27 Volume of television production, by type 38Exhibit 3 - 28 Number of television projects, by type 38Exhibit 3 - 29 Volume of television production, by genre 39Exhibit 3 - 30 Total volume of Canadian television production, by genre, share of total volume, 2006/07 39Exhibit 3 - 31 Number of hours of television production, by genre 39Exhibit 3 - 32 Trends in budgets of English-language Canadian television production 40Exhibit 3 - 33 Trends in budgets of French-language Canadian television production 41Exhibit 3 - 34 Volume of Canadian television production, by language 42Exhibit 3 - 35 Volume of Canadian television production, by language, 2006/07 share 42Exhibit 3 - 36 Volume of Canadian television production, by genre and language 43Exhibit 3 - 37 Animation, volume of Canadian television production, by language 43Exhibit 3 - 38 Television production, by Canadian content points (excludes international treaty co-production) 44Exhibit 3 - 39 Volume of Canadian television production, by province 45Exhibit 3 - 40 Financing of Canadian television production 46Exhibit 3 - 41 Financing of Canadian television production, by genre, 2006/07 47Exhibit 3 - 42 Financing of English-language Canadian television production 47Exhibit 3 - 43 Financing of French-language Canadian television production 48Exhibit 3 - 44 Average licence fees paid by Canadian broadcasters for Canadian television programming, 2006/07 48


Profi le 2008 5

Exhibit 3 - 45 Expenditures on Canadian independent production by private Canadian broadcasters 49Exhibit 3 - 46 Expenditures by private Canadian broadcasters on broadcaster-affi liated production 50Exhibit 3 - 47 Total revenue of private Canadian broadcasters 50Exhibit 3 - 48 Total profi t before interest and taxes (PBIT) of private Canadian broadcasters 51Exhibit 3 - 49 Total Canadian television production with CTF contributions 52Exhibit 3 - 50 Number of full-time equivalent jobs (FTEs) generated by CTF-supported production 53Exhibit 3 - 51 CTF-supported hours of television production, by genre 53Exhibit 3 - 52 CTF contributions to television production, by genre 53Exhibit 3 - 53 Treaty co-production with Canada in the television sector 54Exhibit 3 - 54 Treaty co-production with Canada in the television sector, by partner country, 2006 and 2007 55Exhibit 3 - 55 Volume of international treaty co-production for the television market, by genre 55Exhibit 3 - 56 Television audience share to Canadian programming, English-language market, September 2005 to May 2006 56Exhibit 3 - 57 Television audience share to Canadian programming, French-language market, September 2005 to May 2006 56Exhibit 3 - 58 Top ten television series in Canada, September 2006 to May 2007 57Exhibit 3 - 59 Top ten Canadian television series in the French-language market, September 2006 to May 2007 57Exhibit 3 - 60 Top ten Canadian television series in the English-language market, September 2006 to May 2007 57Exhibit 3 - 61 Total volume of Canadian theatrical production 59Exhibit 3 - 62 Number of Canadian theatrical fi lms produced in Canada on an annual basis 59Exhibit 3 - 63 Number of full-time equivalent jobs (FTEs) in Canadian theatrical production 60Exhibit 3 - 64 Volume of Canadian theatrical production, by language 61Exhibit 3 - 65 Number of theatrical fi lms, by language 61Exhibit 3 - 66 Volume of Canadian theatrical production, by genre 62Exhibit 3 - 67 Number of Canadian theatrical fi lms, by genre 62Exhibit 3 - 68 Trends in budgets of theatrical feature fi lms (fi ction genre only) 63Exhibit 3 - 69 Annual shares of theatrical feature fi lm projects, by budget size 63Exhibit 3 - 70 Volume of Canadian theatrical production, by province 64Exhibit 3 - 71 Financing of Canadian theatrical production 65Exhibit 3 - 72 Total Canadian feature fi lm production activity with CFFF contributions 66Exhibit 3 - 73 Number of Canadian theatrical-release feature fi lms that received fi nancial support from the CFFF 66Exhibit 3 - 74 Treaty co-production with Canada in the theatrical sector 67Exhibit 3 - 75 Treaty co-production with Canada in the theatrical sector, by partner country, 2006 and 2007 67Exhibit 3 - 76 Canadian box offi ce revenues, by origin of production 68Exhibit 3 - 77 Share of Canadian box offi ce revenues, by origin of production 69Exhibit 3 - 78 Number of fi lms playing in Canadian theatres, by origin of production 69Exhibit 3 - 79 Canadian box offi ce and market share, by linguistic market 70Exhibit 3 - 80 Top ten fi lms presented in the English-language market, 2007 71Exhibit 3 - 81 Top ten fi lms presented in the French-language market, 2007 71Exhibit 3 - 82 Top ten Canadian-produced fi lms presented in the English-language market, 2007 71Exhibit 3 - 83 Top ten Canadian-produced fi lms presented in the French-language market, 2007 71

Section 4

Exhibit 4 - 1 Total volume of foreign location production 73Exhibit 4 - 2 Number of full-time equivalent jobs (FTEs) in foreign location production 74Exhibit 4 - 3 Volume of foreign location production, by province 75Exhibit 4 - 4 Share of total volume of foreign location production, by province, 2006/07 75Exhibit 4 - 5 Total volume of foreign location production, by type of production 76Exhibit 4 - 6 Annual number of foreign location projects, by province 77

Section 5

Exhibit 5 - 1 Total volume of broadcaster in-house production 79Exhibit 5 - 2 Broadcaster in-house production, by segment 80Exhibit 5 - 3 Number of full-time equivalent jobs (FTEs) in broadcaster in-house production 80Exhibit 5 - 4 Broadcaster in-house production, by province 81


6 Profi le 2008

A Year of Great TransitionCanada’s production industry faced a series of economic challenges in 2007 – a sharply rising Canadian dollar, threats to the financing of the Canadian Television Fund (CTF), and corporate consolidation in the broadcasting industry. New platforms continued to erode the traditional base of production, but were not yet mature enough to offset the traditional market losses with much in the way of new sources of revenues. However, the industry proved quite resilient in a year of great transition, and adapted well to many of these challenges.

6


Profi le 2008


Profi le 2008 7

The threats

Available funding for domestic production came under threat, with Shaw Communications Inc. and Vidéotron ltée’s attempt to withdraw from the CTF. The market saw a reduction in the number of domestic buyers for Canadian programming, as the Canadian Radio-television and Telecommunications Commission (CRTC) approved the acquisitions of Alliance Atlantis Communications Inc. and CHUM Limited. At the time of writing, the future of the French-language private conventional broadcaster TQS was in jeopardy. And the competitiveness of Canada’s foreign location production (FLP) industry remained under threat in 2007, as it continued to grapple with a rising Canadian dollar.

And while all of these developments unravelled in our domestic market, technological change – as well as consumer and business adaptation to such change – continued apace the world over. Peer-to-peer technology providers, such as Joost, accelerated the potential for broadband to become a more effi cient means of distributing content. Consumers found themselves paying more and more attention to the Internet, mobile phones, and video-game consoles. Advertising dollars followed many of the new communities established by online properties – thus sapping growth for traditional media, and television in particular.

A collaborative response

The crisis over CTF funding was averted…..for the time being at least. The debate is not over, however, just delayed. The impact of broadcaster consolidation may be attenuated by the benefi ts packages put forward by the acquiring broadcasting groups. Some provincial governments responded to the rise in the Canadian dollar by increasing their tax credits. The diversion of advertising revenue away from broadcasters remained a trickle rather than cascading into a torrent.

Despite this tremendous potential disruption, Canada’s production industry has continued to shine with great creative successes. Internationally recognized Little Mosque on the Prairie, Les hauts et les bas de Sophie Paquin, and Emmy-award

winning interactive platform for ReGenesis are but a few examples of such creative excellence.

In 2008, the production industry seeks to secure a sound foundation from which to grow, prosper and innovate across borders and platforms. It will continue to need a strong collaborative effort among all segments and government. Strong and stable CTF and Canada Feature Film Fund (CFFF) funding are imperative; measures to encourage production-company fi nancing that drives slate development and cross-platform innovation are also vital. The fi nancing secured through enhanced domestic and foreign tax credits, and federal and provincial programs – including the CTF – coupled with the chance to work with broadcasters from development to broadcast exhibition, affords producers the opportunity to complete the best product possible.

The CRTC needs to maintain much of the regulation for broadcasting distribution undertakings (BDUs) that has been in place for decades and has allowed Canadian BDUs and broadcasters to reap fi nancial rewards, while giving Canadians access to Canadian television programming. At the same time, the CRTC should not shy away from developing innovative approaches for the regulation of new platforms that allow this growing segment to also contribute to the goals of Canada’s broadcasting policy. Regulatory decisions that secure access to distribution, and reaffi rm foreign investment limits and Canadian ownership rules will enable the production industry to focus on what it knows how to do best – creating award-winning, world-recognized, and commercially successful content.

Canadian television – improved success for Canadian productions in international markets

While platforms are indeed multiplying and younger age groups are spending less time exclusively in front of the television, linear television remains the primary source of high-budget, mass-media audiovisual content – the type of content that spawns webisodes and mobisodes for other digital platforms.


8 Profi le 2008

There were some very promising trends in Canadian television production in 2006/07. The statistics in Profi le 2008 point to a rise of 15% in the volume of Canadian television production in 2006/07. What is more, the increase was fairly broad-based: the three major genres – fi ction, children’s and youth, and documentary – all experienced strong increases. It is important to recognize that the increases in 2006/07 came after eight years of relative stagnation in Canadian television production.

Profi le 2008’s statistics also point to a small recovery in the export value of Canadian television production. It was 7% higher compared to 2005/06, and reversed seven years of annual declines. As our market is a small one, the long-term health of the Canadian production industry depends increasingly on the international success of Canadian programs – whether they are original or formats. The success of both our drama and children’s and youth programs abroad demonstrates that it is possible for highly Canadian content to resonate with markets abroad – and reap the fi nancial benefi ts of such resonance. In drama, certain programs have seen success in the U.S. and abroad: ReGenesis airs in over 100 international countries,1 and is in syndication in 75% of U.S. markets.2 Da Vinci’s Inquest, Degrassi: The Next Generation, and Cold Squad are also in syndication in the U.S.3 Minuit, le soir garnered four awards at the Rencontres Internationales de Télévision de Reims in 2007, while France 2 purchased the fi rst two seasons of Les hauts et les bas de Sophie Paquin in late 2007.4

In children’s and youth television programming, Canadian animation and live-action productions have become staples on children’s broadcasters throughout the world. Life with Derek airs in 100 countries;5 Atomic Betty can be seen in 125 countries;6 young viewers in more than 90 countries can enjoy Naturally, Sadie.7

But before any of these television programs could see success internationally, they needed to be supported and promoted by the domestic market. Successful domestic exposure and promotion provides the boost needed for securing international sales.

Canadian theatrical production – increasing reliance on public funding

Six years into Script to Screen, the Canadian Feature Film Policy’s “in-cinema” results are mixed.

Although higher than before the Policy, Canadian theatrical production was down by 14% in 2006/07 over the previous year – even though the level of CFFF production rose, there was less third-party fi nancing. These results highlight two concerns: fi rst, less and less Canadian theatrical production is actually taking place outside of the CFFF. And second, production that is taking place inside the CFFF is drawing less and less external fi nancing – thereby reducing the leverage of the CFFF investment.

In 2006, Bon Cop Bad Cop and Trailer Park Boys: The Movie gave the industry reason to be hopeful that Canadian fi lms – particularly in the English-language market – could achieve some box-offi ce momentum. David Cronenberg’s Eastern Promises and Sarah Polley’s Away from Her were the bright spots for Canada’s English-language cinema in 2007. However, neither of these fi lms – both recipients of wide international acclaim – represented the type of audience blockbuster required to move the box-offi ce-share needle in any signifi cant way: Canadian fi lms garnered almost 1% of the English-language box offi ce in 2007, consistent with historic levels, but not a breakthrough year for English-language producers.

Canada’s French-language fi lms’ box offi ce essentially moved sideways in 2007. The strong box offi ce runs for Les 3 p’tits cochons, Nitro, and À vos marques… Party! kept Canadian fi lms’ share of the market at just over 16%.

The talent of Quebec’s fi lmmaking community is now well-established. There is no shortage of quality scripts; however, the fi nancing available to turn these scripts into successful fi lms is in short supply. SODEC, like most of the provincial funding agencies, is limited in the resources it can put towards jumpstarting Quebec fi lm production. The box-offi ce performance of Canadian fi lms in both language markets demonstrates that $100 million is not going to be enough to yield the output and quality of Canadian fi lms needed to achieve any sustained domestic box offi ce share. Industry and


Profi le 2008 9

Government need to look at ways of encouraging private investments in the production sector and more international fi nancing.

With Script to Screen’s attention to Canadian dramatic cinema, Telefi lm Canada should not lose sight of the future of the Canadian theatrical documentary. In 2007, Telefi lm Canada, along with its partners, Rogers Group of Funds and the National Film Board, extended the feature-documentary pilot program by one year, offering just under $1.9 million for the production and post-production of English- and French-language productions. The documentary genre, however, deserves a long-term feature fi lm fund, still separate from the CFFF.

Many feature-length documentaries are best enjoyed in theatres; today, however, many Canadian documentary fi lms must forego theatrical releases and rely on television fi nancing and windows. In recent years, Canadians have produced such outstanding national and international successes as The Corporation, Les Voleurs d’enfance and Manufactured Landscapes. A stand-alone, long-term fund would go a long way towards furthering Canada’s long tradition of cinematic leadership in the feature-documentary genre and permit the fi lms to secure a theatrical release that will generate interest in subsequent windows.

Foreign location – remaining competitive even as the dollar climbs

The statistics in Profi le 2008 show a general decrease in Canada’s competitiveness in the FLP market: volume was down by 14% in 2006/07. While Quebec posted a small recovery, British Columbia and Ontario witnessed steep declines. At the time of writing, governments in Nova Scotia, Ontario, Quebec and British Columbia had already responded by raising their FLP tax credit rates; other provinces will likely have to follow suit.

Some form of high-dollar offset is an appropriate policy response. FLP represents a source of knowledge and technical transfer for domestic producers; these transfers help improve producers’ own abilities and international competitiveness.

Treaty co-production – in urgent need of a new policy

Treaty co-production was at one time a prominent piece of the Canadian production industry. Canada’s co-production policies and treaties must keep pace with the changing global production industry and the rules of national treatment in partner countries. While the level of Canada’s treaty co-production activity was up in 2007, it was still about half the level reached in 2000.

The international success of treaty projects such as Eastern Promises and The Tudors is a testament to the importance of treaty co-production for Canadian producers: co-production represents one of the best avenues for Canadian producers to create and fi nance fi lms and television programs that attract global audiences. The Canadian market is often just too small to singularly fi nance independent feature fi lms or high-impact television dramas.

The slow recovery in Canada’s treaty co-production sector underlines the urgent need for the federal government to implement a new treaty co-production policy. Any policy must be fl exible enough for Canadian producers to attract international fi nancing, without diminishing the contributions from Canadians to the key creative roles. Indeed, a comprehensive fi lm, television and interactive media co-production policy may be required to address the specifi c circumstances of this market. Such a policy, coupled with enhanced domestic tax credits that would help balance any increases to the FLP credits, would help raise co-production levels while allowing Canadian producers to retain and exploit the rights in their projects.

Developments in 360 content and new-platform distribution

Canadian producers continued to be at the leading edge of innovations in 360-degree-content strategies that combine linear content with an array of interactive content over broadband and mobile platforms. Canadian producers, Shaftesbury Films and Xenophile Media, together, collected an International Interactive Emmy Award in Cannes last April for the interactive applications accompanying ReGenesis.8 The ReGenesis’ team


10 Profi le 2008

shared their Emmy with another Canadian producer, Zinc Roe Design, for its interactive children’s program, Zimmer Twins. The online animation shorts comprising Les têtes à claques turned into a runaway success in Quebec in 2007. By the end of the year, this web-based compilation of puppet-animation shorts was a hit in France, pulling in over 200,000 visitors per day to the web site; it was also one of the top-selling DVDs in Canada.9

More success stories like these are going to become vital to the continued health of the Canadian production community and its ability to engage Canadian and international audiences. During the past twelve months, the distribution of television-style content over the Internet took, arguably, a great leap forward. Up until recently, Internet TV had been plagued by defi ciencies in download speed and picture quality. Last year, however, the same peer-to-peer gurus who brought us Kazaa and Skype entered into the Internet-TV fray with the launch of Joost.

Joost applies peer-to-peer technology to the legal distribution of TV content over the Internet, and…it earns revenues from advertising sales. Joost is far from the only online player in Internet television; there are countless other sites popping up daily to offer television-style content. Some content is exclusive to the Internet; but much of what is available is comprised of pieces or complete episodes of licensed television content.

Apple’s iTunes Store has also taken-up TV content. Territory by territory, Apple’s iTunes Stores are starting to add downloadable television content to their libraries. CBC/Radio-Canada and CTV have now joined iTunes.ca’s family of content providers. For around $1.99 per episode, Canadians can now download their favourite episodes of Little Mosque on the Prairie or Corner Gas – presumably after they air on conventional television. Canadians cannot – as of yet – download simulcast American network programs that dominate the prime-time schedules of Canada’s English-language conventional broadcasters10 – further evidence that borders do exist in cyberspace.

A review of developments in new-platform distribution in 2007 would not be complete without a mention of Facebook. Facebook demonstrated that the social-networking site could be another

“killer app” on the Internet – just as e-mail was a decade ago. Indeed, Canadians proved to be some of the most avid users of Facebook and social networking sites. Solutions Research Group reports that nearly eight million Canadians use social networking sites – more than any other country except the United States.11 Social networking sites may prove to be more than just “stay-in-touch” tools; they may become important portals for distributing television content, as well.

At this juncture in the development of Internet TV, we see a diversity of business models out there. Some are based entirely on advertising revenues and so are very similar to conventional television. Other Internet TV services – such as iTunes – are gravitating to on-demand models. Regardless of which revenue models persist, one can expect advertising dollars to migrate to Internet TV as audiences migrate. And while the migration will probably not be a deluge of any sort, such a future scenario obviously has policy implications for the Canadian broadcasting system that relies to a great extent on advertising revenues to further the goals of Canada’s broadcasting policy.

Investing in new content

To successfully incorporate new platforms into Canadian broadcasting and cultural policy, government and stakeholders must take a number of steps. First and foremost is a renewed investment in Canadian content production. As Canadian audiovisual content competes more directly with international fare through new platforms, it will have to be of higher quality. Given this, industry stakeholders should be looking at enhancing the CTF rather than reducing or even eliminating it. The CTF is an effective tool for supporting Canadian audiovisual production and many of the television programs that it supports are successful in Canada and elsewhere.

The need for additional monies for high-quality Canadian content suggest that it may be time for the CRTC to restore the CTF contributions to 5% of eligible BDU revenues. The original design of the CTF was based on the 5%; BDUs should no longer erode this amount through other initiatives. The CRTC should also look closely at ways in which Internet service providers (ISPs) may begin


Profi le 2008 11

to contribute to the CTF or a similar fund. As Canadians increasingly turn to the Internet for broadcasting content, ISPs stand to benefi t from the monthly rental of more and more bandwidth.

The CTF itself – and other support measures – will have to be fl exible enough to support the new fi nancing and business models that come with new-platform content. New guidelines and policies for the CTF are likely going to be required for the multi-platform world. The policies will have to recognize that Internet or mobile releases may precede television distribution in some cases.

Renewed content investment also requires the involvement of the public broadcaster. CBC/Radio-Canada’s resources must be restored to a level at which it can operate with limited commercial infl uence.

Multi-platform rights: new business models

Multi-platform business models are built around rights – distribution, exhibition, advertising placement, and so on. A good rights environment begins with appropriate and effective copyright legislation – legislation that protects producers’ right to earn economic benefi ts from their works. The enactment of reforms to Canada’s Copyright Act should be a priority for the federal government; the new provisions should bring Canada’s copyright regime in line with international treaties and provide much-needed property protections against piracy.

The Canadian Film and Television Production Association has been quite clear about the need for mandatory Terms of Trade between Canadian broadcasters and producers. To date, the CRTC has only made Terms of Trade an “expectation” of Canadian broadcasters.

The corporate consolidation within Canada’s private broadcasting sector in 2007 has only further tilted the economic leverage within the sector towards broadcasters: the control of domestic outlets and revenues is more concentrated than Canadian audiences and producers ever envisioned. Mandatory Terms of Trade is a step towards mitigating the potential strengthening of buyer power in the content-licensing market.

In the United Kingdom (U.K.), a mandatory Terms of Trade regime has introduced transparency and fairness into the production sector. As a result, the U.K. has witnessed improved fi nancial health and rapid capitalization in its production sector, which is now in a better position to fulfi l the U.K. government’s public policy goals.12 Not surprisingly the producers and broadcasters in the U.K. are moving very aggressively into new-platform production and distribution.

Canadian Terms of Trade agreements should also provide a fair and transparent framework within which producers and broadcasters can negotiate licensing agreements. It should establish clear minimums for the television broadcasters’ licensing fees for Canadian programming. It should also recognize that online, mobile and on-demand windows are distinct from scheduled broadcast windows, and offer broadcasters the potential for incremental revenue. Terms of Trade should also provide an effective mechanism for grievance arbitration and dispute resolution for both parties, monitored by – and accountable to – the CRTC.

Without some type of Terms of Trade agreements, there is a grave risk that producers will be compelled by the licensing marketplace to steal from Peter to pay Paul. The creation of webisodes and mobisodes cost money to produce – money that could go into the production of the core property – the property that really drives audiences. Without some framework for allowing producers to seek remuneration for these ancillary properties, production companies simply will not have the resources to develop and produce quality content.

Building healthy production companies

Building healthy production companies is going to require a combination of policy and regulatory initiatives. There needs to be improved fi nancial support for Canadian production – traditional and new platform – through the expansion of federal and provincial support programs. Tax credit programs need to be adjusted to ensure their corporate development objectives are reinforced. This expansion could include drawing in even more


12 Profi le 2008

fi nancing to Canadian audiovisual production and giving Canadian producers the maximum fl exibility to attract international fi nancing.

The various initiatives discussed in this essay would encourage an environment where Canadian audiovisual content can be more internationally competitive and fi nancially healthy, and would help redress the economic imbalances that have existed within the Canadian broadcasting system for decades.

The production industry, itself, may also need to consider changing the way it does business. More corporate consolidation may help the industry form some national leaders: companies with the size and resources to better negotiate rights and build libraries. The improved economic position of the Canadian production community would permit it to make the investments in storytelling, format development, audience engagement, interactivity and HD that are necessary in the multi-platform world. This could lead to a virtuous cycle whereby the Canadian production industry improves to the point of being a world leader in digital production.

The Canadian production industry has had a strong year. The industry has once again shown that it can achieve signifi cant audiences when given the opportunity to compete. As Canada’s independent production industry continues to develop, invest and compete, one thing will be constant: Canadian producers will continue to offer stories and perspectives for audiences around the world to enjoy for years to come.

1 Mark Dillon, “Producers excel in the face of uncertainty,” Playback, November 26, 2007.2 Playback Staff, “Sold!, ”Playback, July 9, 2007. 3 Michael Shepard, “Making sense of syndication,” Playback, November 26, 2007.4 Richard Therrien, “Sophie Paquin à la conquête des Français,” Le Soleil, October 18, 2007.5 Mark Dillon, “Producers excel in the face of uncertainty,” Playback, November 26, 2007.6 “Atomic Betty,” Breakthrough Films & Television, downloaded January 7, 2008, http://www.breakthroughfi lms.com/production_showlistings_show_microsite_default.asp?sid=75.7 Gary Rusak, “Sadie travels the world,” Playback, July 3, 2007.8 Marise Strauss, “ReGenesis, Zimmer Twins sites share Emmy win,” Playback, April 19, 2007.9 Matthew Hays, “Online smash to launch in English,” Playback, December 17, 2007.10 Sean Davidson, “CBC, CTV jump on iTunes bandwagon. Finally,” Playback, December 12, 2007.11 Chris Sorenson, “1 in 4 Canadians on Facebook,” Toronto Star, December 10, 2007.12 CFTPA, Submission by the Canadian Film and Television Production Association with Respect to: Broadcasting Notice of Public Hearing CRTC 2007-5 Diversity of Voices, July 18, 2007, paragraph 105.


Profi le 2008 13

1. IntroductionThe Canadian Film and Television Production Association (CFTPA), the Association des producteurs de films et de télévision du Québec (APFTQ), the Department of Canadian Heritage, and Nordicity Group Ltd. have once again collaborated to prepare Profile 2008.

Profi le 2008 provides an analysis of economic activity in the Canadian fi lm and television production industry from April 1, 2006 to March 31, 2007.

Profi le 2008 includes several new production indicators that provide readers with additional insights into the historical trends and current composition of fi lm and television production in Canada. In relation to Profi le 2007, the authors have removed the section on international treaty co-production and integrated these data into parts of Section 3, Canadian Production, which includes an overview of Canadian production, followed by more detailed statistics on both Canadian television and Canadian theatrical production.

In terms of new statistical indicators, Profi le 2008 includes:

• Detailed statistics on the volume of Canadian television production in each genre by language;

• A breakdown of the sources of fi nancing for English-language and French-language Canadian television production;

• A breakdown by language of Canadian television in each genre;

• Statistics for international treaty co-production for both the television and theatrical feature fi lm sectors, as well as a listing of all treaty co-production partners in these sectors; and,

• Key statistics on the Canadian fi lm and television market.

Taken together, the existing and new statistical indicators will give readers the most comprehensive look yet at fi lm and television production activity in Canada.



14 Profi le 2008

2. National IndicatorsThe Canadian film and television production industry has, for the last several years, been a major source of economic activity and jobs for Canadians right across the country. In this chapter, we review the overall national activity in the film and television production industry. In subsequent chapters, we examine activity in each of the major segments of Canadian industry: Canadian production, foreign location production, and broadcaster in-house production.

14


Profi le 2008


Profi le 2008 15

2.1 Total Volume of Production

The total volume of production in the Canadian fi lm and television industry increased slightly to just under $5 billion in 2006/07. After experiencing a 9% drop in 2004/05, the fi lm and television production industry in Canada posted two consecutive annual increases – 7% in 2005/06 and 2% in 2006/07.

The expansion in the total volume of production (ie., the total dollar amount of expenditures on fi lm and television production in Canada) was driven by increased volumes in two sectors – Canadian television production and broadcaster in-house production. The other two sectors of the production industry in Canada – foreign location production and Canadian theatrical production – experienced decreases in production volume.

The Canadian television production sector was the largest sector of the Canadian industry in 2006/07: it accounted for 42% of total production with a volume of $2.1 billion. Canadian television production experienced a staggering annual increase of 15% in 2006/07, as it climbed from $1.8 billion in 2005/06.

The signifi cant expansion in Canadian television production can be traced back to increased production volumes in the fi ction, children’s and youth, and documentary genres. The children’s and youth genre, in particular, staged a dramatic jump in production volume in 2006/07.

The expansion of this genre and the other genres is largely domestic. The increased production volume is being fi nanced from Canadian sources. Foreign pre-sale demand did recover slightly in 2006/07, but not to a great extent, and certainly not to a level that made it the driver of this sector’s expansion.

After staging a signifi cant recovery in 2005/06, Canadian theatrical production dropped 14% to $282 million in 2006/07. This sector accounted for 6% of total production volume in 2006/07. In part, falling foreign fi nancing put downward pressure on the volume of activity.

Foreign location production (FLP) was the second largest sector of the Canadian industry with $1.4 billion in production volume in 2006/07, accounting for 29% of the national total. FLP was down by 14%, as Canada started to feel the effects of a stronger domestic currency and competition from other jurisdictions with concerted efforts to attract Hollywood studios’ location production. Canada’s two largest centres for FLP – British Columbia and Ontario – both experienced decreases in production volume in 2006/07.

Broadcaster in-house production also increased, largely due to the resumption of NHL hockey; broadcaster in-house production increased 11% to reach just over $1.1 billion. This sector accounted for 23% of total production activity in Canada in 2006/07.

• The total volume of fi lm and television production in Canada increased 3% to just under $5 billion in 2006/07. The increase was largely due to strong growth in Canadian television production and broadcaster in-house production.

• The Canadian television production segment was the largest single sector of the industry in 2006/07, accounting for 42% of total production.

• Film and television production generated 126,900 full-time equivalent jobs (FTEs) in Canada in 2006/07, including 48,800 FTEs directly in fi lm and television production activities. The number of FTEs was up by less than 1% compared to 2005/06.

• Total export value was down 14% to $1.7 billion, largely because of drops in levels of foreign location production and the foreign fi nancing of Canadian theatrical production.

Highlights

16 Profi le 2008

Exhibit 2 - 1: Total volume of film and television production in Canada

0

1,000

2,000

3,000

4,000

5,000

6,000

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Canadian Television

Canadian Theatrical

Foreign Location

Broadcaster In-House

Source: Estimates based on data collected from CAVCO, CRTC, CBC/SRC, the Association of Provincial Funding Agencies and the Department of Canadian Heritage. Some totals may not add due to rounding.Note: The figures for volume of production contain a variety of sources with different reporting periods. All data sources are reported on a 12-month basis for each fiscal year, but the reporting periods overlap. For example, in 2006/07 the bulk of data sources were for the government fiscal year (April 2006 to March 2007). However, some data sources that reported results on a fiscal-year period ending in August 2006 are included in the fiscal year.

2,983

790

1,239

186

768

2,925

743

1,114

249

819

3,844

760

1,787

201

1,096

4,452

850

1,870

226

1,506

4,631

885

1,757

227

1,762

4,736

963

1,785

228

1,760

4,995

997

1,805

279

1,914

5,011

1,043

1,723

342

1,904

4,550

1,094

1,816

177

1,463

4,856

1,032

1,829

329

1,666

4,973

1,144

2,112

282

1,435

$ m

illio

ns

Exhibit 2 - 2: Total volume of film and television production in Canada, share by segment, 2006/07

Canadian Television, 42% Broadcaster In-House, 23%

Foreign Location, 29%Canadian Theatrical, 6%

Source: Estimates based on data collected from CAVCO, CRTC, CBC/SRC, and the Association of Provincial Funding Agencies.

16


Profi le 2008


Profi le 2008 17

2.2 GDP

Real gross domestic product (GDP) in the Motion Picture and Video Production, Distribution and Post-Production industry grew by an average annual rate of 1.5% between 1998 and 2006, trailing the growth in the overall economy by 1.8 percentage points.

2.3 Employment

Film and television production continued to be a major source of job creation in Canada in 2006/07. Film and television production activity in Canada led to the creation of an estimated 126,900 full-time equivalent jobs (FTEs). Production activity generated 48,800 FTEs directly within the fi lm and television production industry, and an additional 78,100 FTEs in other parts of the Canadian economy. The number of FTEs generated by fi lm and television production rose for the second consecutive year, increasing by less than 1%, from 126,200. Production industry FTEs (direct jobs) also rose by less than 1% in 2006/07.

Exhibit 2 - 3: Average annual real GDP growth by industry, 1998 to 2006

Source: Calculations based on data from Statistics Canada * Based on the North American Industry Classification System. Information and Cultural Industries includes publishing industries (except Internet), motion picture and sound recording industries, broadcasting (except Internet), Internet publishing and broadcasting, telecommunications, Internet service providers, Web-search portals, data-processing services and other information services. Motion Picture and Video Production, Distribution and Post-Production Industry comprises establishments primarily engaged in producing and/or distributing motion pictures, videos, television programs or commercials; exhibiting motion pictures or providing post-production and related services.

0 2 4 6

Radio and TV Broadcasting + Pay TV, Specialty TV and

Program Distribution

Information andCultural Industries*

Service-ProducingIndustries

Goods-ProducingIndustries

Motion Picture and VideoProduction, Distribution and

Post-Production Industry*

All Industries

2.4%

3.7%

3.9%

1.5%

3.3%

5.3%

Exhibit 2 - 4: Number of full-time equivalent jobs (FTEs) in film and television production in Canada

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Indirect Jobs

Direct Jobs

Source: Estimates based on data collected from CAVCO, Statistics Canada, CRTC, CBC/SRC, the Association of Provincial Funding Agencies and the Department of Canadian Heritage.Note: Estimates of direct FTEs take into account annual changes in average wages.

0

50,000

100,000

150,000

93,100 91,100

117,800

135,100 137,000 135,900 139,100 136,700

121,100126,200 126,900

35,800 35,00045,300 52,000 52,700 52,300 53,500 52,600 46,600 48,500 48,800

57,300 56,100

72,500

83,100 84,300 83,600 85,600 84,100

74,500 77,700 78,100

FTEs

Profi le 2008


18 Profi le 2008

2.5 Production by Province

Ontario maintained its position as the leading province for fi lm and television production in Canada in 2006/07: it accounted for $1.7 billion in production volume, or 34% of the national total. With a 29% share, British Columbia was Canada’s second-largest production centre, with fi lm and television production activity rising to just over $1.4 billion. British Columbia was followed closely by

Quebec, where the volume of production increased 12% to just under $1.3 billion – a 25% share of the national total.

British Columbia, Quebec, Alberta, Nova Scotia, Manitoba, Saskatchewan, New Brunswick and Prince Edward Island all experienced increased production levels in 2006/07, while production dipped in Ontario, and Newfoundland and Labrador.

18

Exhibit 2 - 5: Export value of film and television production in Canada

Canadian Television

Canadian Theatrical

Foreign Location

Source: Estimates based on data collected from CAVCO, the Association of Provincial Funding Agencies and the Department of Canadian Heritage. Some totals may not add due to rounding.

$ m

illio

ns

0

500

1,000

1,500

2,000

2,500

96/97

768

1,312

63

481

97/98

1,247

78

350

819

98/99

1,704

68

540

1,096

99/00

2,177

71

600

1,506

00/01

2,319

80

478

1,762

01/02

2,271

69

442

1,760

02/03

2,371

78

380

1,914

03/04

2,321

104

314

1,904

04/05

1,767

27

277

1,463

05/06

1,955

75

214

1,666

06/07

1,684

19

230

1,435

2.4 Export Value

Export value tracks the value of international fi nancial participation in the fi lm and television production industry in Canada. Export value includes foreign presales and distribution advances for all projects certifi ed by the Canadian Audio-Visual Certifi cation Offi ce (CAVCO)1; estimates of presales and distribution advances for non-CAVCO-certifi ed productions; and the total value of foreign location production in Canada. Export value as opposed to just exports better refl ects the nature of fi lm and television production in Canada. It acknowledges that fi lm and television productions are intangible products and portions of the copyright can be exported to foreign countries. It also accounts for the budgets of productions shot in Canada, even when the copyright is held by a foreign entity.

The export value of fi lm and television production in Canada totalled $1.7 billion in 2006/07 – a decrease of 14% from 2005/06. The drop in export value can be attributed to a decrease of $231 million in FLP, as well as a drop of $56 million in the export value of Canadian theatrical production, from $75 million in 2005/06 to $19 million in 2006/07.

Despite the overall decrease in the export value of fi lm and television production in Canada, the Canadian television sector showed signs of recovery in its export performance in 2006/07. The export value of Canadian television production increased 9%, from $214 million to $230 million, reversing a trend of six consecutive annual declines.

1 “CAVCO certifi ed” refers to productions certifi ed as “Canadian” by the Canadian Audio-Visual Certifi cation Offi ce (CAVCO) for the purpose of utilizing the Canadian Film or Video Production Tax Credit (CPTC). It does not include foreign productions that use the Film or Video Production Services Tax Credit (PSTC), which must also get certifi cation from CAVCO, but are not considered “Canadian” productions.


Profi le 2008 19

Exhibit 2 - 6: Volume of film and television production in Canada, by province

Source: Estimates based on data collected from CAVCO, CRTC, CBC/SRC, the Association of Provincial Funding Agencies and the Department of Canadian Heritage. Note: Various provincial film agencies in Canada also publish statistics for film and television production activity using tax and marketing data in each province. Their statistics may differ from those in Profile 2008 due to such differences as data collection periods (fiscal vs. calendar year) and production activity reported on the basis of location of spend. Some totals may not add due to rounding. * Figures for film and television production in the Territories (Nunavut, Yukon, Northwest Territories) have been combined with figures for British Columbia.

( $ millions ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Ontario 1,330 1,214 1,506 1,717 1,825 1,943 1,917 1,820 1,940 1,941 1,710British Columbia* 560 583 843 1,079 1,166 1,165 1,156 1,548 929 1,339 1,429Quebec 835 872 1,092 1,172 1,180 1,201 1,385 1,209 1,243 1,132 1,266Alberta 124 105 133 237 180 153 199 117 119 134 182Nova Scotia 64 63 124 135 119 129 138 130 116 133 150Manitoba 35 36 64 44 70 74 85 112 95 80 122Saskatchewan 21 36 50 37 41 32 83 45 71 55 78New Brunswick 7 11 21 15 32 17 17 16 28 19 23Prince Edward Island 1 1 2 8 6 8 10 5 2 1 7Newfoundland and Labrador 5 4 9 7 12 15 6 8 7 22 6

Total 2,983 2,925 3,884 4,452 4,631 4,736 4,995 5,011 4,550 4,856 4,973

Exhibit 2 - 8: Total direct and indirect full-time equivalent jobs (FTEs) generated by film and television production in Canada, by province

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Ontario 41,600 37,700 46,300 52,000 54,100 55,600 53,300 49,700 51,700 50,400 43,500British Columbia* 17,400 18,200 25,700 32,800 34,600 33,300 32,200 42,100 24,700 34,800 36,300Quebec 26,000 27,000 33,500 35,600 34,800 34,300 38,500 33,000 33,000 29,400 32,200Alberta 3,900 3,400 4,200 7,300 5,200 4,400 5,500 3,100 3,100 3,400 4,700Nova Scotia 2,100 2,100 3,900 4,200 3,600 3,600 3,900 3,600 3,100 3,400 3,900Manitoba 1,000 1,000 2,100 1,300 2,100 2,100 2,300 3,100 2,600 2,100 3,100Saskatchewan 800 1,000 1,600 1,000 1,300 1,000 2,300 1,300 1,800 1,600 2,100New Brunswick 300 300 500 500 1,000 500 500 500 800 500 500Prince Edward Island 0 0 0 300 300 300 300 300 150 150 300Newfoundland and Labrador 300 0 300 300 300 500 300 300 300 500 300

Total 93,400 90,700 118,100 135,300 137,300 135,600 139,100 137,000 121,250 126,250 126,900

Source: Estimates based on data collected from CAVCO, CRTC, CBC/SRC, the Association of Provincial Funding Agencies, Statistics Canada and the Department of Canadian Heritage. Some totals may not add due to rounding and the sum total of jobs may differ from amounts in Exhibit 2 - 4 due to rounding. * Includes the Territories.

Exhibit 2 - 7: Share of total volume of production in Canada, by province, 2006/07

Source: Estimates based on data collected from CAVCO, CRTC, CBC/SRC, the Association of Provincial Funding Agencies and the Department of Canadian Heritage.* Includes the Territories

Ontario, 34% Nova Scotia, 3%

Newfoundland and Labrador, <1%

New Brunswick, <1%

Manitoba, 3%

British Columbia*, 29%

Alberta, 4%Saskatchewan, 2%

Quebec, 25%

Prince Edward Island, <1%


Profi le 2008


20 Profi le 2008

3. Canadian ProductionCanadian production includes all Canadian television and film production produced by Canadian production companies. This includes independent production companies as well as broadcaster-affiliated production companies.

20


Profi le 2008


Profi le 2008 21

3.1 Total Canadian Production

Canadian production includes television programs and fi lms with CAVCO certifi cation; it also includes CRTC-certifi ed television programs made by production companies. This sector excludes broadcaster in-house production – that is, news and sports and other genres normally produced by Canadian broadcasters.

3.1.1 Volume

Canadian production reached a total volume of $2.4 billion in 2006/07. The total volume jumped by 11%, following an increase of 8% in 2005/06. The sharp rise in Canadian production was due to an increase of $283 million in Canadian television production; the increase in Canadian television production was partly offset by a $47 million decrease in Canadian theatrical production.

• Canadian production jumped 11% to $2.4 billion, largely due to a sharp increase in Canadian television production.

• Canadian production generated 61,100 FTEs in 2006/07, including 23,500 FTEs directly in the production of Canadian television programs and fi lms.

• English-language production rose 13% to $1.7 billion; French-language production increased 12% to $651 million. Production in bilingual format and other languages dropped from $50 million to $24 million.

• Canadian production in the fi ction genre increased by 5% to $1.2 billion.

• Children’s and youth production climbed by 25%, increasing from $275 million in 2005/06 to $344 million in 2006/07. The increase was fuelled by a $70 million rise in animation production in the genre.

• Canadian documentary production increased by 17% to a total of $435 million.

• Canadian production in the variety and performing arts genre increased 32% to $132 million.

• Canadian production attracted fi nancing from several different private- and public-sector sources in 2006/07. Broadcasters were the largest single source of fi nancing – contributing 31% of the total. Tax credits accounted for 26%. Foreign sources accounted for 9% of the fi nancing of Canadian production.

• Canada’s total volume of treaty co-production increased 14% to $478 million in 2007, with Canadian budgets of $195 million and foreign budgets of $282 million in partner countries. However, the level of co-production in 2007 was still approximately half the peak level attained in 2000.

• France moved past the United Kingdom to become Canada’s largest bipartite treaty co-production partner in 2007; Canadians produced $202 million worth of bipartite treaty co-production in 2007 with producers from France.

Highlights


22 Profi le 2008

3.1.2 Employment

Canadian production generated an estimated 61,100 FTEs in Canada in 2006/07. This amount included 23,500 FTEs directly in the production of Canadian television programs and fi lms,

as well as 37,600 FTEs in other parts of the Canadian economy. The total number of FTEs and production-industry FTEs (direct jobs) rose by 9% in 2006/07.

Exhibit 3 - 1: Total volume of Canadian production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Source: Estimates based on data collected from CAVCO.Note: Canadian production includes CAVCO-certified television and film production, and an estimate for CRTC-certified television production. Canadian production also includes production with non-theatrical release.

1,4251,364

1,9882,095

1,985 2,0132,084 2,065

1,993

2,159

2,394$

mill

ions

0

500

1,000

1,500

2,000

2,500

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Exhibit 3 - 2: Number of full-time equivalent jobs (FTEs) in Canadian production

Indirect Jobs

Direct Jobs

Source: Estimates based on data from CAVCO and Statistics Canada.Note: Estimates of direct FTEs take into account annual changes in average wages.

44,50042,400

60,90063,600

58,700 57,700 58,000 56,40053,000

56,100

61,100

FTEs

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

17,100 16,30023,400 24,500 22,600 22,200 22,300 21,700 20,400 21,600 23,500

27,400 26,100

37,50039,100

36,100 35,500 35,700 34,70032,600 34,500

37,600


Profi le 2008


Profi le 2008 23

3.1.3 Language

Both English-language and French-language production contributed to the overall increase in Canadian production in 2006/07; however, production in bilingual format and other languages dropped by half.

Canadian production produced in English increased 13% to over $1.7 billion in 2006/07. Canadian production in the French-language increased 12% to $651 million. Production in bilingual format and other languages dropped from $50 million in 2005/06 to $24 million in 2006/07.

Exhibit 3 - 3: Volume of Canadian production, by language

$ m

illio

ns

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

English French Bilingual and other

0

500

1,000

1,500

2,000

2,500

1,055

1,623 1,6321,431 1,433

1,4961,437 1,413

1,5281,719

1,094

1,364

1,9882,095

1,985 2,0132,084 2,065

1,993

2,159

2,394

1,425

282

340 400

394 483508 522 532

50

24

32627

2563

15998

80 10748

581

651

5

Source: Estimates based on data from CAVCO.Note: Some totals may not add due to rounding.

3.1.4 Genres

Fiction

The production of television programs and fi lms in the fi ction genre increased by 5% in 2006/07, and reached a total of $1.2 billion. The overall increase was largely due to an expansion in the level of television fi ction production, where the volume of production grew by $113 million, or 14%, to a total of $948 million in 2006/07.

On a dollar-volume basis, just over three-quarters of Canadian fi ction production in 2006/07 was for English-language television and theatrical markets; 23% of the production volume was for French-language markets; while fi ction production in other languages accounted for less than 1% of the total volume of production in the genre.

The fi ction genre is comprised almost entirely of live-action production; animation production totalled only $13 million in 2006/07.

Nearly 70% of the fi ction projects made by Canadian producers were either television movies or television series. Canadian producers made a total of 121 television movies (36%), 117 television series (34%), 71 theatrical feature fi lms (21%) and 19 short-length fi lms and television programs (6%) in the fi ction genre; there were 13 mini-series made by Canadian producers in 2006/07.


24 Profi le 2008

Exhibit 3 - 5: Volume of fiction production, by language, 2006/07

English, 76%

French, 23% Other, <1%

Source: Estimates based on data from CAVCO.Total does not add due to rounding.

Exhibit 3 - 6: Number and share of fiction projects, by type, 2006/07

TV series, 34%

Mini-series,4%Short-length filmsand TV programs, 6%

Theatricalfeatures, 21%

MOW/TV features, 36%

Source: Estimates based on data from CAVCO.

Total number of projects: 341

117

1319

71

121

Exhibit 3 - 4: Total volume of fiction production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Theatrical

Television

923 913

1,162

1,296

1,100 1,093 1,123

1,038

953

1,1531,215

0

300

600

900

1,200

1,500

755 672

981

1,071

892 875852 721

801835

948

168241

182

225

207 218 272

317 152

318

267

Source: Estimates based on data from CAVCO.Some totals may not add due to rounding.

$ m

illio

ns



Profi le 2008 25

Children’s and Youth

Children’s and youth production experienced an astounding recovery in production volume in 2006/07, following six consecutive years of annual declines. In 2006/07, the volume of this genre’s production jumped by 25%: it increased from $275 million in 2005/06 to $344 million in 2006/07. While the theatrical production volume rose from $2 million to $7 million in 2006/07, this growth was overshadowed by the strong expansion in television production: it rose from $273 million to $337 million. The increase in television production was due, in large part, to an increased number of high-budget animation television series.

On a dollar-volume basis, most children’s and youth programming in Canada is produced initially for English-language markets. In 2006/07, 85% of programming in this genre was originally produced in English; 15% of production was in originally made French.

A more detailed look at the breakdown of children’s and youth production reveals that a large share of the genre’s production in the English language can be traced back to the fact that most animation production in the genre is produced originally in

English. Approximately 94% of the $223 million of children’s and youth animation production in 2006/07 was originally made in English. The vast majority of French-language production in the children’s and youth genre was in the live-action format: live-action production accounted for 73% of all children’s and youth production originally made in French in 2006/07.

The low volume of French-language animation production can be explained by the fact that animation is a highly exportable commodity which presupposes the existence of an English version. The cost of producing an English version from an original French version was, up to now, signifi cantly higher than the reverse. This could change however, given the recently negotiated agreements between producers and French-speaking performers. Based on accepted practices in English Canada, these agreements should promote an increase in animation production in the French-language market.

The vast majority of children’s and youth television productions are television series. In 2006/07, Canadian producers made 91 television series – accounting for 95% of all children’s and youth projects in that year.

Exhibit 3 - 7: Total volume of children’s and youth production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Theatrical

Television

$ m

illio

ns

0

100

200

300

400

240

173

366389

358 355

300

288276

273

337

13

1

168

41

2

7

253

174

382 389

366355

304289

276 275

344


Profi le 2008


26 Profi le 2008

Exhibit 3 - 8: Volume of children’s and youth production, by language, 2006/07

English, 85%

French, 15%


Exhibit 3 - 9: Volume of children’s and youth production, by language and format

( $ millions ) Live Action Animation Total Live Action Animation Total

English 70 146 217 84 209 292 French 40 7 46 38 14 52

Total 110 153 263 122 223 344

Source: Estimates based on data from CAVCO.Note: Totals exclude production in bilingual format or other languages.

05/06 06/07

Exhibit 3 - 10: Number and share of children’s and youth projects, by type, 2006/07

Theatrical Features, 1%

MOW / TV, 1%

Single-Episode Television Programs, 3%

TV Series, 95%



91

3

1

1


Profi le 2008


Profi le 2008 27

The Canadian production community has long been a global leader in animation production. Several successful independently produced Canadian animation programs are televised on children’s broadcasters around the world. In 2006/07, the Canadian animation production segment experienced a spectacular jump in production

volume. Animation production increased 35% to $257 million. Canadian producers made 585 hours of animation in 2006/07, up from 473 hours in 2005/06. Children’s and youth programming accounted for 87% ($223 million) of total Canadian animation production in 2006/07.

Exhibit 3 - 11: Total volume of Canadian animation production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

152

99

274

249

280

241

208 203

225

190

257$

mill

ions

0

50

100

150

200

250

300


Exhibit 3 - 12: Total number of hours of Canadian animation production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

232

168

335313

333

380

311

347

392

473

585

Hou

rs o

f pro

duct

ion

0

100

200

300

400

500

600



Profi le 2008


28 Profi le 2008

Documentary

There was a strong increase in the volume of Canadian documentary production in 2006/07, after three consecutive years of stalled growth. The increase in the volume of documentary production was due almost entirely to a jump in the production of documentaries for television. Canadian documentary production increased by 17% to a total of $435 million in 2006/07. Television production accounted for $428 million, or 98% of total Canadian documentary production.

Between 1999/00 and 2006/07, Canadian documentary production displayed a long-term growth pattern; during this period, it more than doubled. And while the genre’s growth was relatively fl at between 2003/04 and 2005/06, it resumed its growth trend in 2006/07.

On a dollar-volume basis, approximately three-quarters of Canadian documentary production in 2006/07 was made initially for the English-language market. Documentaries made initially for the French-language market accounted for 19% of production. Bilingual documentaries and documentaries produced in other languages accounted for 4%.

Television series and single-episode television programs together accounted for 93% of all Canadian documentary projects in 2006/07.

Canadian producers made 215 documentary television series in 2006/07 and 262 single-episode documentary programs for television; they made 23 documentary mini-series. There were nine feature-length documentaries made primarily for theatrical release in 2006/07.

Exhibit 3 - 13: Total volume of documentary production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Theatrical

Television

0

100

200

300

400

500

119

122 132

255

184

260

293314

385 379 373

435

125

253

184

254286 311

361 374 370428

4 7

3 7

73

24 5 3

6

$ m

illio

ns


Profi le 2008


Profi le 2008 29

Exhibit 3 - 14: Volume of documentary production, by language, 2006/07

Bilingual and Other, 4%

English, 77%

French, 19%


Exhibit 3 - 15: Number and share of documentary projects, by type, 2006/07

Mini-Series, 5%

Single-Episode Television Programs, 51%

TV Series, 42%

Theatrical Features, 2%



262

215

23 9


30 Profi le 2008

Variety and Performing Arts

Production in the variety and performing arts genre increased 32% to $132 million in 2006/07. This increase followed two consecutive years of decreases in production volume. After experiencing steady growth during the late 1990s and early years of this millennium, production in the variety and performing arts genre experienced sharp drops in 2004/05 and 2005/06 before recovering in 2006/07.

All production in the variety and performing arts genre in 2006/07 was in the television sector. Indeed, with a few exceptions in the last eleven years, virtually all of the programming in this genre was in the Canadian television sector.

On a dollar-volume basis, most variety and performing arts programming in Canada is produced for the French-language market; this is the opposite of the language distribution found

in other genres. In 2006/07, approximately three-quarters of programming in this genre was made in French, while 25% of production was made in English. The high share of variety and performing arts programming in the French-language market is largely due to the existence of an established star system in Quebec.

Of the 130 variety and performing arts projects produced in 2006/07, 51 (40%) were television series, 43 (33%) were single-episode television programs, 29 (22%) were MOW/TV features, and seven (5%) were mini-series.

Exhibit 3 - 16: Total volume of variety and performing arts production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Theatrical

Television

0

50

100

150

200

51

52

69 70

83

99

114

127

151

120

100

132

69 6983

99111

127151

118100

132

23

1

1

$ m

illio

ns


Profi le 2008


Profi le 2008 31

Exhibit 3 - 17: Volume of variety and performing arts production, by language, 2006/07

English, 25%

French, 75%


Exhibit 3 - 18: Number and share of variety and performing arts projects, by type, 2006/07

Mini-Series, 5%

Single-Episode Programs, 33%

TV Series, 40%

TV Series, 40%

MOW / TV Features, 22%



51

43

29

7


32 Profi le 2008

3.1.6 Financing

The production of Canadian television programs and theatrical fi lms relies on fi nancing from a variety of private- and public-sector sources – both within and outside of Canada.

In 2006/07, Canadian broadcasters were the single-largest source of fi nancing for Canadian production. Private and public broadcasters accounted for a combined 31% of total fi nancing for Canadian television programs and theatrical fi lms.

On a combined basis, federal and provincial tax credits represented the second-largest source: they accounted for 26% of total fi nancing.

Tax-credit fi nancing represents part of a Canadian production company’s equity in television and fi lm projects. Canadian production companies receive tax credits based on their eligible labour expenditures; in most cases, they have to invest their tax-credit claims directly into the fi nancing of television projects. As well, producers often have to raise capital for project fi nancing through corporate or personal lines of credit, mortgages on personal property and deferral of producer fees. After taking into account tax credits and production-company fi nancing for Canadian production, the producers’ contribution to production budgets is, at a minimum, between 25% and 30% in most instances. Producers also organize domestic and foreign distribution, as well as arrange bank fi nancing.

3.1.5 Production by Province

Quebec led all other provinces in 2006/07 in terms of Canadian production. Quebec-based producers generated $900 million of Canadian production. Quebec was followed by Ontario with $739 million. Canadian production in British Columbia increased 77% to $472 million in 2006/07, marking the fi rst time in that province that the volume was above $350 million.

Nova Scotia, Manitoba, Alberta and Saskatchewan comprised the middle tier of provinces, based on levels of Canadian production. These four provinces recorded between $57 million and $69 million in Canadian production in 2006/07. Producers based in New Brunswick, Prince Edward Island, the Territories (Nunavut, Yukon, and Northwest Territories), and Newfoundland and Labrador also generated Canadian production in 2006/07.

Exhibit 3 - 19: Volume of Canadian production, by province

( $ millions ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Quebec 546 555 705 752 626 745 766 783 736 814 900Ontario 662 606 757 814 796 854 802 891 772 894 739British Columbia 138 100 338 350 342 241 256 217 274 266 472Nova Scotia 41 39 88 53 62 58 63 56 66 56 69Manitoba 18 13 23 20 25 20 29 17 27 32 68Alberta 13 23 37 70 72 62 82 55 58 33 63Saskatchewan 7 23 22 18 29 18 67 33 37 36 57New Brunswick 0 5 13 7 21 6 9 8 20 10 15Prince Edward Island 0 0 1 7 5 7 9 2 1 0 6Territories* 0 0 0 2 0 0 0 0 0 3 3Newfoundland and Labrador 1 0 5 3 7 3 1 3 2 15 1

Total 1,425 1,364 1,988 2,095 1,985 2,013 2,084 2,065 1,993 2,159 2,394

Source: Estimates based on data collected from CAVCO.Some totals may not add due to rounding. Note: Various provincial film agencies in Canada also publish statistics for film and television production activity using tax and marketing data in each province. Their statistics may differ from those in Profile 2008 due to such differences as data collection periods (fiscal vs. calendar year) and production activity reported on the basis of location of spend.* Territories include Yukon, Nunavut and Northwest Territories.


Profi le 2008 33

Other private-sector sources – including private-sector monies (BDU contributions) from the Canadian Television Fund (CTF), broadcasters’ equity investments and funding from independent production funds – accounted for 12% of total fi nancing. Other public-sector sources – such as the CTF (public contributions) and Canada Feature

Film Fund (CFFF) – also accounted for 12%.Foreign fi nancing sources such as foreign broadcasters and distributors contributed 9% of the total fi nancing for Canadian production. Canadian distributors contributed 7% of total fi nancing in 2006/07.

3.1.7 Treaty Co-production

International treaty co-production is another avenue through which Canadian producers can tap into international fi nancing and talent to create fi lms and television programs with international audience appeal. The Government of Canada currently has co-production treaties with 53 countries. As co-production treaties are founded on the principle of reciprocity, the Canadian producer is responsible for approximately one-half of the total treaty co-production budget.

Canada’s total volume of treaty co-production increased 14% in 2007, following a 43% jump in 2006. Canada’s total volume of treaty co-production reached $478 million in 2007, with Canadian budgets of $195 million and budgets of $282 million in partner countries.

In terms of bipartite production, France was Canada’s largest treaty co-production partner in 2007, with 21 projects totalling $202 million in production volume (Canadian and foreign budgets). Canada’s other major bipartite partners included the United Kingdom (U.K.) ($106 million), Ireland ($43 million), Germany ($25 million), China ($14 million) and Luxembourg ($11 million).

In addition to bipartite treaty co-production, six of Canada’s treaty co-productions in 2007 took place through multipartite (three or more countries) projects. Among Canada’s multipartite partner countries in 2007 were Japan, Brazil, South Africa, U.K., Australia, Singapore, Romania, Switzerland, France, and Germany.

Exhibit 3 - 20: Sources of financing for Canadian production, 2006/07

Public Broadcaster Licence Fees, 12%

Federal Tax Credit, 10% Private Broadcaster Licence Fees, 19%

Foreign, 9%

Canadian Distributor, 7%

Provincial Tax Credit, 16%

Other Private**, 12%

Public*, 12%

Production Company, 3%

Source: Estimates based on data obtained from CAVCO. Based on CAVCO classifications. * Public includes financing from the Canadian Television Fund (public contributions), provincial governments, Telefilm Canada and other government departments and agencies.** Other Private includes financing from the Canadian Television Fund (BDU contributions), independent production funds, broadcaster equity, and other private investors.


34 Profi le 2008

Exhibit 3 - 21: Total volume of treaty co-production with Canada

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Canadian Budgets

Foreign Budgets

0

200

400

600

800

1,000

163

149

312

410

210

200

565

255

310

608

293

315

893

404

489

776

368

408545

264

281

637

315

322 439

229

210 294

158

136

420

249

171

478

195

282

Source: Telefilm Canada.Note: Some totals may not add due to rounding. Statistics are subject to change.

$ m

illio

ns

0 50 100 150 200 250

202

106

43

25

14

11

7

5

3

3

Exhibit 3 - 22: Total volume of bipartite treaty co-production with Canada, bypartner country, 2007

France

United Kingdom

Ireland

Germany

China

Luxembourg

Australia

Switzerland

Philippines

Czech Republic

Number of projects

Source: Telefilm Canada.Note: Statistics are subject to change.

21

16

2

5

3

1

1

2

1

2

$ millions

Exhibit 3 - 23: Total volume of multipartite treaty co-production with Canada, by partner country, 2007

Japan - Brazil

South Africa - U.K.

Australia - Singapore

U.K. - Romania

Switzerland - France

Germany - Greece

0 10 20 30

Source: Telefilm Canada.Note: Statistics are subject to change.

Number of projects

28

13

9

5

4

1

1

1

1

1

1

1

$ millions



Profi le 2008 35

• Canadian television production jumped 15% to $2.1 billion, compared to an increase of only 1% in 2005/06.

• Canadian television production generated 53,900 FTEs in 2006/07, including 20,700 FTEs directly in the production of Canadian television programs.

• Television-series production of various genres was the largest component of Canadian television production. Canadians produced 622 television-series projects in 2006/07 with a total volume of $1.4 billion.

• Fiction production jumped by $113 million, or 14%, to $948 million. Children’s and youth production was up by $64 million over the 2005/06 level; it increased 23% to a total of $337 million. Documentary production rose 16% to $428 million. Variety and performing arts programming increased 32% to $132 million. Production in other genres doubled to $130 million. The magazine-programming genre experienced a decrease of 26% in 2006/07 – dropping to $136 million.

• While both English-language and French-language Canadian television production experienced increases in 2006/07, the overall expansion in Canadian television production was led by English-language production, which increased 22% to over $1.5 billion. French-language production increased 7% to $553 million. Production in bilingual formats and other languages contracted from $46 million to $19 million.

• Canadian television production continued to rely heavily on fi nancing from Canadian broadcasters, as fi nancing from foreign sources and Canadian distributors remained relatively low compared to previous years.

• The average per-hour broadcast licence fee for English-language Canadian fi ction productions was $286,000; for French-language productions, the average was $150,000 per hour – albeit on a much lower average budget.

• The CTF made fi nancial contributions of $252 million to support $880 million in television-production volume in 2006/07.

• Quebec-based producers accounted for the largest share of Canadian television production – 37%; Ontario and British Columbia accounted for 31% and 21%, respectively.

• Canada’s volume of international treaty co-production in the television sector decreased 18% to $178 million in 2007; this decrease followed a 5% decrease in 2006.

Highlights

3.2 Television Production

Canadian television production includes the production of various genres of television series, mini-series, MOWs, television feature fi lms and short fi lms made primarily for the television audiences. It includes productions that are

certifi ed as Canadian content by either CAVCO or the CRTC. This sector excludes broadcaster in-house production – that is, news and sports and other genres normally produced by Canadian broadcasters.


36 Profi le 2008

3.2.1 Volume

The total volume of Canadian television production jumped 15% in 2006/07, following eight consecutive years of fl uctuation around the $1.8 billion level. Canadians produced a total 9,090 hours of original television production in 2006/07 with a total volume of over $2.1 billion.

Statistics in this section of the report show that the gains in Canadian television production were broad-based: all of the genres, except the magazine-programming genre, experienced increases in production volume. The fi ction, and children’s

and youth genres led the sector’s increase in production volume; the documentary, and variety and performing arts genres also posted strong increases in 2006/07.

The growth in production was driven almost entirely from additional domestic fi nancing. Canadian broadcasters, distributors, and other private sources, along with public sources increased their levels of fi nancing for Canadian television production. Foreign pre-sale demand for Canadian television programming and the associated fi nancing played a very limited role in the expansion of Canadian television production in 2006/07.

Exhibit 3 -24: Total volume of Canadian television production

$ m

illio

ns

0

500

1,000

1,500

2,000

2,500

Source: Estimates based on data from CAVCO.Note: Canadian television production includes CAVCO-certified television production and an estimate for CRTC-certified production. Canadian television production also includes productions for non-theatrical release.

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

1,2391,114

1,7871,870

1,757 1,785 1,8051,723

1,816 1,829

2,112

Exhibit 3 - 25: Total hours of Canadian television production

Hou

rs o

f pro

duct

ion


96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

4,9805,392

6,465

8,087

9,4278,631

9,981

9,1309,406

8,7079,090

0

2,000

4,000

6,000

8,000

10,000

Profi le 2008


Profi le 2008 37

Exhibit 3 - 26: Number of full-time equivalent jobs (FTEs) in Canadian television production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Direct Jobs

Indirect Jobs

FTEs

0

10,000

20,000

30,000

40,000

50,000

60,000

14,900 13,300

21,100 21,800 20,000 19,700 19,300 18,100 18,600 18,300 20,700

23,800

38,700

34,700

54,80056,700

52,000 51,200 50,200

47,00048,300 47,600

53,900

21,400

33,700 34,900 32,000 31,500 30,900 28,900 29,700 29,300 33,200

Source: Estimates based on data from CAVCO and Statistics Canada.Note: Estimates of direct FTEs take into account annual changes in average wages.

3.2.2 Employment

Canadian television production generated an estimated 53,900 FTEs in Canada in 2006/07. This amount included 20,700 FTEs directly in the production of Canadian television programs, as

well as 33,200 FTEs in other parts of the Canadian economy. Total FTEs and production-industry FTEs (direct jobs) both rose by 13% in 2006/07, after experiencing declines of 1% in 2005/06.

3.2.3 Types

Since 1996/97, the vast majority of Canadian television productions have been television series of various genres. MOWs and television movies, short-length programs (less than 74 minutes), and mini-series have accounted for a smaller share of Canadian television production activity.

In 2006/07, television series production increased to just over $1.4 billion; production of MOWs and made-for-television feature fi lms increased to $389 million; short-length program production rose to

$159 million; production of television mini-series increased to $96 million; the production budgets for television pilots jumped to $28 million, from only $6 million the prior year.

The number of Canadian television series decreased to 622 in 2006/07. The number of MOWs and television feature fi lms increased to 205, while the number of short-length programs for Canadian television dropped to 302. The number of mini-series increased to 43. The number of television pilots rose to 27, from 17 the year before.


38 Profi le 2008

Exhibit 3 - 27: Volume of television production, by type

( $ millions ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Series 1,004 877 1,412 1,509 1,421 1,411 1,374 1,362 1,363 1,248 1,411MOW / television feature films 141 127 206 215 193 143 181 157 217 369 389Short-length programs 48 46 90 75 79 133 100 132 152 147 159Mini-series 38 54 68 66 59 86 142 63 77 59 96Television Pilot 7 11 11 5 6 13 8 8 7 6 28

Total 1,239 1,114 1,787 1,870 1,757 1,785 1,805 1,723 1,816 1,829 2,112


Exhibit 3 - 28: Number of television projects, by type

( number ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Series 314 315 450 538 591 613 692 662 674 665 622MOW / television feature films 76 70 96 99 98 113 115 88 129 158 205Short-length programs 205 177 259 265 311 358 361 426 431 372 302Mini-series 21 19 22 25 40 39 61 59 56 41 43Television Pilot 19 14 8 12 9 18 11 7 20 17 27

Total 635 595 835 939 1,049 1,141 1,240 1,242 1,310 1,253 1,199


3.2.4 Genres

All of the television genres except the magazine-programming genre contributed to the increase in the volume of Canadian television production in 2006/07.

Fiction production jumped by $113 million, or 14%, to $948 million. Children’s and youth production was up by $64 million over the 2005/06 level; it increased 23% to a total of $337 million. Documentary production rose 16% to $428 million. The magazine-programming genre experienced a decrease of 26% – dropping to $136 million. Variety and performing arts programming increased 32% to $132 million. Production in other genres doubled to $130 million.

Fiction production comprised 45% of total Canadian television production in 2006/07. The second-largest genre was documentary with a 20% share, followed by children’s and youth (16%). Magazine- programming, variety and performing arts, and other genres each accounted for approximately 6% of total Canadian television production.

While the fi ction genre was the largest genre in terms of volume of production, the magazine-programming genre was actually the largest genre when measured in terms of hours of production. In 2006/07, Canadian producers generated 3,274 hours of original magazine programming. The magazine-programming genre was followed by the documentary genre (2,483 hours), fi ction (1,189 hours), children’s and youth (827 hours), variety and performing arts (771 hours), and other genres (546 hours).



Profi le 2008 39

Exhibit 3 - 29: Volume of television production, by genre

( $ millions ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Fiction 755 672 981 1,071 892 875 852 721 801 835 948Children’s & Youth 240 173 366 389 358 355 300 288 276 273 337Documentary 119 125 253 184 254 286 311 361 374 370 428Magazine 58 48 68 96 119 130 148 136 152 185 136Variety & Performing Arts 51 69 69 83 99 111 127 151 118 100 132Other 16 28 50 48 35 28 68 66 94 65 130

Total 1,239 1,114 1,787 1,870 1,757 1,785 1,805 1,723 1,816 1,829 2,112


Exhibit 3 - 30: Total volume of Canadian television production by genre, share of total volume, 2006/07

Documentary, 20%

Magazine, 6%

Variety & Performing Arts, 6%

Other, 6%Fiction, 45%

Children’s & Youth, 16%

Source: Estimates based on data from CAVCO. Total may not add due to rounding.

Exhibit 3 - 31: Number of hours of television production, by genre

( hours ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Fiction 891 725 914 1,066 1,023 1,012 1,096 1,133 1,205 1,065 1,189Children’s & Youth 767 732 817 884 826 933 808 694 839 867 827Documentary 790 709 1,272 1,180 1,790 1,891 1,921 2,119 2,103 1,983 2,483Magazine 1,720 1,764 1,906 3,337 4,280 3,491 4,479 3,673 3,925 3,645 3,274Variety & Performing Arts 650 907 903 1,107 1,095 1,016 1,088 1,033 848 582 771Other 162 555 653 512 413 289 589 478 486 566 546

Total 4,980 5,392 6,465 8,087 9,427 8,631 9,981 9,130 9,406 8,707 9,090



Profi le 2008


40 Profi le 2008

Exhibit 3 - 32: Trends in budgets of English-language Canadian television production

( 000s per hour ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Fiction Average 1,352 1,314 1,466 1,360 1,175 1,283 1,282 1,034 1,033 1,314 1,206 Median 1,123 1,108 1,345 1,224 1,292 1,074 1,192 1,151 1,168 1,261 1,533Documentary Average 161 204 230 172 196 157 177 197 211 205 183 Median 182 197 215 214 225 208 210 235 242 229 261Children’s & Youth Average 746 399 648 638 575 488 483 538 514 489 608 Median 615 541 765 681 652 630 490 469 550 530 640Variety & Performing Arts Average 140 113 101 87 106 117 138 163 236 350 348 Median 127 133 114 99 123 159 300 230 355 311 260Magazine Average 32 31 38 32 49 52 43 43 46 75 34 Median 34 45 51 43 61 55 42 51 48 48 12

Source: Estimates based on data from CAVCO.Note: The calculation of the average budget excludes the foreign budgets of treaty co-productions.

3.2.5 Trends in Budgets

English-Language Production

For English-language production, average budgets were higher in 2006/07 for children’s and youth programming; they were lower in all other genres.

• English-language fi ction production had an average hourly budget of just over $1.2 million in 2006/07 – down from $1.3 million in 2005/06 and well below averages in the late 1990s.

• For documentaries, the average hourly budget dropped 11% to $183,000 in 2006/07.

• Children’s and youth programming had an average hourly budget of $608,000 in 2006/07 – a 24% increase over 2005/06. In part, this increase was due to the higher share of animation production in the genre; the hourly budgets for children’s animation projects are often considerably higher than those of live-action projects.

• The average hourly budget for variety and performing arts programming was virtually unchanged at $348,000 in 2006/07.

• The average hourly budget in the magazine-programming genre was $34,000 in 2006/07 – less than half of the 2005/06 average of $75,000 per hour.

French-Language Production

For French-language production, average budgets were higher in 2006/07 in the genres of fi ction, children’s and youth, and variety and performing arts programming; they were lower in the documentary and magazine-programming genres.

• French-language fi ction production had an average hourly budget of $336,000 in 2006/07 – up from $282,000 in 2005/06.

• For documentaries, the average hourly budget decreased 7% to $141,000.

• Children’s and youth programming had an average hourly budget of $145,000 – a 22% increase over 2005/06.

• The average hourly budget for variety and performing arts programming rose slightly in 2006/07 to $154,000.


Profi le 2008 41

Exhibit 3 - 33: Trends in budgets of French-language Canadian television production

( 000s per hour ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Fiction Average 298 366 320 340 335 307 291 244 282 282 336 Median 243 491 258 349 283 288 390 334 363 487 476Documentary Average 131 146 149 124 74 135 124 123 120 151 141 Median 216 191 173 186 145 182 152 175 172 191 173Children’s & Youth Average 126 65 157 166 102 172 142 177 95 119 145 Median 96 64 123 107 115 138 131 182 105 141 153Variety & Performing Arts Average 65 63 64 70 86 111 110 105 121 148 154 Median 97 77 78 85 94 146 142 159 144 133 143Magazine Average 35 26 35 27 23 33 32 38 40 51 45 Median 35 25 45 34 33 37 35 36 41 38 41

Source: Estimates based on data from CAVCO.Note: Calculations exclude the foreign budgets of treaty co-productions.

• The average hourly budget in the magazine-programming genre was $45,000 in 2006/07 – down by 11% from 2005/06, but still well above the rates in previous years.

In the fi ction genre, the average hourly budget of French-language programming is typically lower than that of English-language programming for several reasons. Many of the popular fi ction

programs in Canada’s French-language market are téléromans (soap operas); as well, they are typically not produced for export. For these reasons, fi ction productions in Canada’s French-language market are characterized by lower production costs; they are shot in digital with smaller supporting casts and production crews, often on location, and with limited special effects and stunts.

3.2.6 Language

While both English-language and French-language Canadian television production experienced increases in 2006/07, the overall expansion in Canadian television production was led by an expansion in English-language production. English-language television production increased 22% to over $1.5 billion; French-language television production increased 7% to $553 million. Production in bilingual formats and other languages contracted from $46 million to $19 million in 2006/07.

A breakdown of Canadian television production statistics by genre and language reveal the following developments in 2006/07:

• Both language markets experienced signifi cant increases in fi ction production. English-language fi ction production was up by 12%; French-language fi ction production was 21% higher.

• The vast majority of the increase in children’s and youth television production in 2006/07 was in the English-language market. English-language television production rose by $68 million, or 31%. French-language production was up by $7 million, or 16%.

• The rise in the volume of documentary production was due entirely to growth in the English-language market; the volume of French-language production actually dropped. English-language documentary production increased 38%; French-language production decreased 24%.


42 Profi le 2008

• The growth in variety and performing arts programming in 2006/07 was largely due to an increase in the French-language market, which accounts for the majority of production in this genre. French-language production rose by $33 million, while English-language production increased by $4 million.

• The French-language market accounted for 89% of total magazine-programming production in 2006/07. Both language markets experienced decreases in the volume of production in

this genre.

• The vast majority of Canadian animation programming produced in 2006/07 was originally shot in English. English-language animation production for television totalled $230 million, or 92% of total television-animation production. Animation production originally shot in French was $19 million in 2006/07, or 8% of total animation production for television.

Exhibit 3 - 34: Volume of Canadian television production, by language

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Bilingual and other

French

English

$ m

illio

ns

0

500

1,000

1,500

2,000

933

301

1,2391,114

1,7871,870

1,757 1,785 1,8051,723

1,816 1,829

2,112

5

25926

31425

359

59

355

150427

98

458

78

440

7547346

519

19

46 553

830

1,447 1,4521,253 1,261 1,269 1,208 1,297 1,264

1,540


Exhibit 3 - 35: Volume of Canadian television production, by language, 2006/07 share

Bilingual and other, 1%

French, 26%

English, 73%


Profi le 2008


Profi le 2008 43

Exhibit 3 - 36: Volume of Canadian television production, by genre and language

( $ millions ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Fiction English 633 568 883 942 765 728 668 583 621 680 762 French 122 104 98 121 118 124 156 138 164 151 183 Other 0 0 0 8 9 23 28 0 16 4 4 Total 755 672 981 1,071 892 875 852 721 801 835 948

Children’s & Youth English 170 122 304 287 209 242 232 224 236 217 285 French 66 25 51 61 35 61 44 44 34 45 52 Other 4 25 12 40 115 52 24 20 5 12 0 Total 240 173 366 389 358 355 300 288 276 273 337

Documentary English 84 80 163 125 184 191 212 249 272 240 332 French 34 45 77 54 57 81 81 91 82 108 82 Other 0 1 13 5 12 14 18 21 20 23 14 Total 119 125 253 184 254 286 311 361 374 370 428

Variety & Performing Arts English 19 29 35 33 37 32 37 47 40 30 34 French 32 39 33 47 59 71 84 73 76 66 99 Other 0 0 0 3 3 8 5 31 2 4 0 Total 51 69 69 83 99 111 127 151 118 100 132

Magazine English 22 18 19 24 37 42 55 50 43 34 14 French 36 30 50 69 81 88 90 83 106 148 121 Other 0 0 0 2 1 1 3 2 3 4 1 Total 58 48 68 96 119 130 148 136 152 185 136


Exhibit 3 - 37: Animation, volume of Canadian television production, by language

( $ millions ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

English 91 74 227 175 148 165 174 149 210 161 230 French 47 1 21 26 8 20 5 25 6 16 19 Other 4 24 12 43 114 56 22 14 5 12 <1 Total 142 99 261 244 270 241 202 187 222 189 250



Profi le 2008


44 Profi le 2008

3.2.7 Content Points

Canadian content in television programs is measured on a ten-point scale (see box at right). The number of Canadian content points that a production receives is related to the creative contributions of key Canadians (i.e., writers, directors, actors), and can reach a maximum of ten points. Treaty co-productions are not subject to the ten-point scale; as such, all Canadian productions except international treaty co-productions receive a content score.

Over the last several years, a larger and larger share of Canadian television productions has garnered the maximum points available to them. The prevalence of television productions with fewer than the maximum points has dropped signifi cantly in the last several years. Ten-point or full-point television productions accounted for 80% of Canadian television production in 2006/07 (based on the dollar volume of production). Television productions with between six and nine points accounted for 20% of Canadian television production.

The shift away from lower-point production to higher-point production refl ects the overall effect of weaker demand from international markets for Canadian television production. With the decline in the television presale market, Canadian producers

have focused on ten-point Canadian production in order to be eligible to receive fi nancial assistance from the Canadian Television Fund (CTF).

CAVCO uses the Canadian content points scale to certify fi lms and television productions. A certifi ed Canadian production qualifi es as Canadian content; broadcasters can use it to meet their Canadian television exhibition requirements. It also allows the production to access the Canadian Film or Video Production Tax Credit (CPTC). To be certifi ed as Canadian content, the production must obtain six or more points on the ten-point scale. There are two separate point scales – one for live-action productions and the other for animation productions. For both scales, points are awarded for various key creative positions. In the case of animation, points are also awarded based on the location of certain animation functions. For more information on the Canadian content points scale, please visit: www.canadianheritage.gc.ca/cavco.

Canadian Content Points

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Exhibit 3 - 38: Television production, by Canadian content points(excludes international treaty co-production)

10 points*

8 and 9 points

6 and 7 points

Shar

e of t

otal

volu

me o

f tele

visio

n pr

oduc

tion

(

base

d on

dol

lar v

olum

e)

0%

20%

40%

60%

80%

100%

26% 24% 24% 25% 28%22% 21%

14% 14% 17% 11%

9%8%

7%10%11%10%

12%16%20%16%14%

60% 60%56% 59% 60%

68% 68%75% 78%

75%80%

Source: Estimates based on data collected from CAVCO.* Includes productions that received the maximum number of eligible points. For example, productions that scored 7 out of 7 points are included in data covering 10 out of 10 points.Note: Some totals may not add due to rounding.

Profi le 2008


Profi le 2008 45

Exhibit 3 - 39: Volume of Canadian television production, by province

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Quebec 457 388 642 627 558 643 660 589 644 728 776 37%Ontario 587 561 678 781 726 764 715 772 704 729 649 31%British Columbia 120 79 292 307 283 212 208 200 264 206 440 21%Manitoba 16 10 17 18 19 17 23 16 26 29 58 3%Alberta 13 20 36 54 63 62 58 53 56 32 57 3%Saskatchewan 7 17 22 13 19 18 63 33 37 36 57 3% Nova Scotia 39 33 84 53 62 55 59 48 61 45 51 2% New Brunswick 0 5 11 7 20 6 9 8 20 10 15 1%Prince Edward Island 0 0 1 7 5 7 9 2 1 0 6 <1%Newfoundland and Labrador 1 0 3 1 2 2 1 3 2 15 1 <1%Territories* 0 0 0 2 0 0 0 0 0 0 0 0%

Total 1,239 1,114 1,787 1,870 1,757 1,785 1,805 1,723 1,816 1,829 2,112 100%

( $ millionsunless specifiedotherwise)

Source: Estimates based on data collected from CAVCO.Some totals may not add due to rounding.Note: Various provincial film agencies in Canada also publish statistics for film and television production activity using tax and marketing data in each province. Their statistics may differ from those in Profile 2008 due to such differences as data collection periods (fiscal vs. calendar year) and production activity reported on the basis of location of spend.* Territories include Yukon, Nunavut and Northwest Territories.

06/07 (share)

3.2.8 Production by Province

Quebec-based producers accounted for the largest share of Canadian television production in 2006/07; Ontario and British Columbia were the two other provinces with more than $100 million of annual Canadian television production. All other provinces recorded production volumes below $100 million.

The volume of Canadian television production by Quebec-based producers topped $776 million in 2006/07, accounting for 37% of the national total. Ontario-based producers generated $649 million

in Canadian television production, or 31% of the national total. Production by producers based in British Columbia more than doubled in 2006/07 – jumping from $206 million to $440 million and giving the province a 21% share of the national total.

Four other provinces – Manitoba, Alberta, Saskatchewan, and Nova Scotia – had more than $50 million in Canadian television production in 2006/07; all four experienced strong growth, as well. In fact, production levels in Manitoba practically doubled from 2005/06.

3.2.9 Financing

Canadian television production continued to rely heavily on fi nancing from Canadian broadcasters, as fi nancing from foreign sources and Canadian distributors remained relatively low in 2006/07, compared to previous years. While the total amount of foreign fi nancing for Canadian television production did increase in 2006/07, fi nancing from domestic sources – particularly Canadian broadcasters, tax credit, and other private sources – fuelled the expansion in Canadian television production.

In terms of the overall distribution of fi nancing in 2006/07:

• Private broadcaster licence fees accounted for 22%, a decrease of one percentage point over the previous year.

• Public broadcaster licence fees accounted for 13%, an increase of two percentage points.

• Federal and provincial tax credits accounted for 26%, an increase of one percentage point.

• Canadian distributors accounted for 6%, the same level as the prior year.


46 Profi le 2008

Exhibit 3 - 40: Financing of Canadian television production

% $ millions % $ millions % $ millions % $ millions % $ millions % $ millions

Private broadcaster licence fees 16% 292 20% 355 22% 377 23% 417 23% 418 22% 460Public broadcaster licence fees 8% 135 9% 159 10% 169 10% 183 11% 200 13% 275Federal tax credit 9% 160 9% 163 10% 174 11% 194 10% 192 11% 230Provincial tax credit 11% 191 11% 206 12% 203 13% 230 15% 277 15% 322Canadian distributor 11% 195 7% 127 8% 133 6% 107 6% 101 6% 135Foreign 22% 390 19% 341 14% 247 13% 228 10% 189 9% 196Production company 4% 77 3% 62 4% 67 3% 56 3% 54 3% 59Other public* 8% 146 9% 156 8% 140 8% 152 8% 139 8% 175Other private** 11% 200 13% 236 12% 212 14% 248 14% 258 12% 259

Total 100% 1,785 100% 1,805 100% 1,723 100% 1,816 100% 1,829 100% 2,112

01/02 02/03 03/04 04/05 05/06 06/07

Source: Estimates based on data obtained from CAVCO. Based on CAVCO classifications. Note: Some totals may not add due to rounding.* Other public includes financing from the Canadian Television Fund (public contributions), provincial governments, Telefilm Canada and other government departments and agencies.** Other private includes financing from the Canadian Television Fund (BDU contributions), independent production funds, broadcaster equity, and other private investors.

• Foreign sources accounted for 9%, a decrease of one percentage point.

• Production companies contributed 3%, the same level as the prior year.

• Other public sources accounted for 8%, the same level as the prior year.

• Other private sources accounted for 12%, a decrease of two percentage points.

Sources of production fi nancing can vary considerably across the television genres. Producers often look to different sources of fi nancing, depending on the genre of the content. In 2006/07, the various genres of Canadian television production had the following fi nancing patterns:

• Fiction productions received 25% of their fi nancing from broadcaster licence fees, 26% from tax credits, and 14% from foreign sources.

• Children’s and youth programming received 28% of its fi nancing from broadcaster licence fees, 29% from tax credits, and 16% from other private sources. Only 4% of the fi nancing for children’s and youth programming came from foreign sources; however Canadian distributors did account for 10%.

• Documentaries received 40% of their fi nancing from broadcaster licence fees, 26% from tax credits, and 10% from other private sources.

• Variety and performing arts programming received 63% of its fi nancing from broadcaster licence fees, and 20% from tax credits.

• Magazine programming received 66% of its fi nancing from broadcaster licence fees, and 26% from federal and provincial tax credits.

The fi nancing models for Canadian television production also vary between Canada’s two language markets. French-language television production is fi nanced largely from Canadian broadcaster licence fees and tax credits, with limited amounts from other sources. The lower average budgets for French-language Canadian television programming (see Section 3.2.5) permits Canadian broadcasters to cover a larger share of the total budget. English-language Canadian television production derives more fi nancing from foreign sources and Canadian distributors; the fi nancing from these two sources offsets the relatively smaller share from Canadian broadcasters.


Profi le 2008 47

Exhibit 3 - 41: Financing of Canadian television production, by genre, 2006/07



Total 100% 948 100% 337 100% 428 100% 132 100% 136 100% 2,112

Fiction

Children’s

and Youth Documentary

Variety and

Performing Arts Magazine All Genres

Source: Estimates based on data obtained from CAVCO. Based on CAVCO classifications. Note: Some totals may not add due to rounding.* Other public includes financing from the Canadian Television Fund (public contributions), provincial governments, and other government departments and agencies.** Other private includes financing from the Canadian Television Fund (BDU contributions), independent production funds, broadcaster equity, and other private investors.

Exhibit 3 - 42: Financing of English-language Canadian television production



Total 100% 1,261 100% 1,269 100% 1,208 100% 1,297 100% 1,264 100% 1,540


01/02 02/03 03/04 04/05 05/06 06/07

In the English-language market, Canadian broadcasters accounted for 29% of total fi nancing in 2006/07; in the French-language market, the share was 49%. Foreign sources and Canadian

distributors contributed 22% of the fi nancing for English-language Canadian television production; while in the French-language market, these two sources contributed only 1%.

Profi le 2008


48 Profi le 2008

Broadcaster Licence Fees

Canadian broadcasters represent the largest single source of fi nancing for Canadian television production. Most fi nancing from Canadian broadcasters is in the form of a broadcast licence fee. On a per-hour basis, broadcast licence fees vary signifi cantly across genres and Canada’s two language markets.

• In 2006/07 in the fi ction genre, broadcaster licence fees averaged $150,000 per hour in the French-language market and $286,000 per hour in the English-language market.

• For documentaries, the average broadcaster licence fee was $54,000 per hour in the French-language market and $128,000 per hour in the English-language market.

• For children’s and youth programming, the average broadcaster licence fee was $90,000 per hour in the French-language market and $156,000 per hour in the English-language market.

• For the variety and performing arts genre, the average broadcaster licence fee was $101,000 per hour in the French-language market and $218,000 per hour in the English-language market.

Exhibit 3 - 44: Average licence fees paid by Canadian broadcasters for Canadiantelevision programming, 2006/07

Children’sand Youth

Variety andPerforming

Arts

Documentary

Fiction

0 50 100 150 200 250 300

French

English

Source: Estimates based on data obtained from CAVCO for a sample of 2006/07 projects and on CAVCO classifications.

150

286

90

156

101

218

54

128

$ 000s per hour

Exhibit 3 - 43: Financing of French-language Canadian television production



Total 100% 427 100% 458 100% 440 100% 473 100% 519 100% 553


01/02 02/03 03/04 04/05 05/06 06/07



Profi le 2008 49

3.2.10 Broadcaster Spending

Canadian broadcasters license original and repeat programming from both independent Canadian production companies as well as broadcaster-affi liated production companies. The latter includes production companies in which broadcasters own or control at least 30% of the equity, whereas the former are independent from broadcaster ownership.

During the 2006 broadcasting year (September 2005 to August 2006) Canadian broadcasters’ spending on independent Canadian production (original and repeat programming) increased 22% to a total of $613 million. There were increases in spending on Canadian programming in each of the three broadcasting-industry segments.

Specialty television services accounted for the largest share of the increased broadcaster spending. In 2006, their expenditures on Canadian programming increased by $86 million, or 27% over 2005. The increase in expenditures was due, in part, to the increase in the number of specialty

television services: the number of services in this segment rose from 123 to 136 – an increase of 11%.

Spending by pay television services rose 45% to $58 million. This increase was largely due to signifi cantly higher levels of spending on Canadian programming by pay-per-view (PPV) and video-on-demand (VOD) services. Eligible Canadian-programming expenditures by PPV and VOD services increased from $7 million to $20 million in 2006.2 This segment also experienced an increase in the number of television services – from 22 to 27 – which contributed to the rise in expenditures.

Private conventional broadcasters increased their spending 5% to $145 million.

2 CRTC , Broadcasting Policy Monitoring Report 2007, p. 82

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Exhibit 3 - 45: Expenditures on Canadian independent production by private Canadian broadcasters*

Private conventional television

Pay television

Specialty television

$ m

illio

ns

0

100

200

300

400

500

600

700

116171 198

233291

331 354 324

410

58

4038

3430

2326

15

121715

76 72 87

97100

101

109

122126

138

145

613

501517

487

430

358324

283

215194191

101 106

Source: Data obtained from the CRTC.* Includes CBC-Radio Canada’s specialty-television services.Some totals may not add due to rounding.Note: Spending on Canadian Independent Production Programming refers to programming and production expenses of conventional television licensees, and Canadian program amortization of specialty and pay television licensees.

Profi le 2008


50 Profi le 2008

In addition to their expenditures on independent production, Canadian broadcasters spent $92 million in 2006 on the licensing of television programs produced by broadcaster-affi liated production companies. The level of expenditures was unchanged from 2005. Of the total amount in 2006, private conventional broadcasters accounted for $55 million; specialty and pay television services accounted for $36 million.

The Canadian broadcasting industry experienced increased revenues in 2006; however, its level of profi ts dropped from 2005. The total revenues of private Canadian broadcasters increased by $272 million, or 6%, during 2006. The specialty and pay television segments both posted higher revenues in 2006; while private conventional broadcasters saw their revenues actually drop by $2 million. The revenues of pay television services rose 18% to $482 million. The revenues of specialty television services increased 11% to just over $2 billion. Private conventional broadcasters still accounted for the largest share of broadcasting-industry revenues, with revenues of $2.2 billion.

The pay television segment was the only part of the Canadian broadcaster industry that improved its profi tability in 2006. Pay television services earned profi ts before interest and taxes (PBIT) of $125 million in 2006, up from $108 million in 2005. The PBIT of specialty television services actually declined

$1 million to a total of $448 million in 2006. Private conventional broadcasters saw their PBIT drop 62% to a total of $91 million in 2006. This steep drop in PBIT can, in large part, be traced back to private conventional broadcasters’ higher expenditures on foreign programming. Private conventional broadcasters’ spending on foreign programming rose by $74 million in 2006; their spending on Canadian programming rose by $37 million.3

3 Source: Nordicity calculations based on data in CRTC, Television: Statistical Financial Summaries, 2005 and 2006.

Exhibit 3 - 46: Expenditures by private Canadian broadcasters* on broadcaster-affiliated production

( $ millions ) 2000 2001 2002 2003 2004 2005 2006

Private conventional broadcasters 47 37 37 28 44 49 55

Specialty and pay television services n.a. n.a. n.a. n.a. n.a. 43 36

Total n.a. n.a. n.a. n.a. n.a. 92 92

Source: CRTC.* Includes CBC-Radio Canada’s specialty-television services.n.a. – data not available.Some totals may not add due to rounding.

Exhibit 3 - 47: Total revenue of private Canadian broadcasters*


Pay television


$ m

illio

ns

0

1,000

2,000

3,000

4,000

5,000

542 590 717 881 1,057 1,205 1,370 1,5351,680 1,811 2,013

482410

384350

333286

214157

125127123

1,6051,707

1,8251,867

1,8801,903

1,8932,092

2,1152,197

2,195

4,6904,418

4,1793,977

3,5963,394

3,1512,905

2,6672,424

2,270

Source: Data obtained from the CRTC.* Includes CBC-Radio Canada’s specialty-television services.

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Profi le 2008


Profi le 2008 51

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Exhibit 3 - 48: Total profit before interest and taxes (PBIT) of private Canadian broadcasters*


Pay television


$ m

illio

ns

0

100

200

300

400

500

600

700

800

83 109 104 118

32231715

213

267202

280

260

26

196 209

62

242

178

80

112193

90

299

233

85

329

449

108

242

91

125

448

Source: Data obtained from the CRTC.* Includes CBC-Radio Canada’s specialty-television services.

311

393

329

430

482513

370

582

647

799

664

3.2.11 Canadian Television Fund

The Canadian Television Fund (CTF) is a public-private partnership with the objective of funding the production of high-quality, distinctly-Canadian television programs in the genres of drama, (fi ction), children’s and youth programming, documentary, and variety and performing arts programming. The CTF derives its revenues from broadcast distribution undertakings (cable television services and direct-to-home satellite services), and the federal government; the CTF then distributes this revenue to producers of Canadian television programs.

Volume

The CTF was established in 1996 and continues to be one of the key tools for supporting Canadian television production. In 2006/07, its contribution to Canadian television programming rose, as did the total production volume supported by its fi nancial contributions.

• The CTF contributed $252 million to production volume totalling $880 million in 2006/07.

• Other fi nancing – comprised largely of contributions from production companies, broadcasters, other government sources and distributors – contributed an additional $628 million to CTF-supported productions.

• CTF contributions rose by 1%; the total volume of CTF-funded production increased by 8%. The increase in CTF contributions was possible because of increased contributions from cable-television and direct-to-home satellite service providers.

• The CTF made a slight improvement in the fi nancial leverage on its projects. Each dollar of fi nancial support from the CTF attracted an additional $2.49 from other public and private fi nancing sources in 2006/07, compared to $2.28 in 2005/06.



52 Profi le 2008

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Exhibit 3 - 49: Total Canadian television production with CTF contributions

Other financing*

Contribution

$ m

illio

ns

0

200

400

600

800

1,000

182

396390

162 200

558

391

181 195 227

425

507

255

509

219 236

497568

249 252

628

880

817

733

659

764

440

733

620

758

572552578

Source: Canadian Television Fund.Some totals may not add due to rounding.* Other financing includes contributions from production companies, broadcasters, other government sources and distributors.

Jobs Supported by CTF Production

In 2006/07, CTF-supported television production generated an estimated 22,400 FTEs, including 8,600 FTEs directly in television production and a further 13,800 FTEs in other parts of the Canadian economy. The FTEs generated by CTF-supported production rose 5% in 2006/07, as the volume of CTF-supported production itself increased. Hours of Television Production

The CTF supports genres that are traditionally under-represented in the Canadian broadcasting system. In 2006/07, the CTF supported just over 2,297 hours of production. This total included:

• 798.2 hours of documentary programming;

• 680.7 hours of children’s and youth programming;

• 548.5 hours of drama (i.e., fi ction) programming; and,

• 270 hours of variety and performing arts programming.

Two of the genres – drama, and variety and performing arts – experienced increases in the

number of supported production hours; while the documentary, and children’s and youth genres experienced declines in production hours. In 2006/07, the CTF’s funding contributions to documentary, and variety and performing arts genres increased; contributions to drama production decreased; while contributions to the children’s and youth genre remained unchanged.


Privately funded independent production funds are a major source of private-sector funding for Canadian fi lm and television production. In the 2006 fi scal year, Canada’s 15 independent production funds made funding commitments totalling $59 million to fi lm, television, and new media projects. Of this amount, production fi nancing comprised approximately $39 million, interim fi nancing comprised $17 million, and development fi nancing comprised $3 million. Amounts based on statistics collected from independent production funds.

Independent Production Funds


Profi le 2008 53

Exhibit 3 - 51: CTF-supported hours of television production, by genre

( hours of production ) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Documentary 543.0 568.0 713.0 634.0 968.0 1,120.8 1,000.2 738.5 809.8 836.5 798.2Children’s & Youth 724.0 517.0 647.0 582.5 513.0 681.5 749.6 595.8 781.8 717.2 680.7Drama (fiction) 614.0 418.0 600.0 638.0 631.0 624.0 532.0 441.0 471.5 525.0 548.5Variety & Performing Arts 312.0 380.0 285.0 180.5 275.0 364.2 273.0 366.5 312.5 197.0 270.0

Total 2,193.0 1,883.0 2,245.0 2,035.0 2,387.0 2,790.5 2,554.8 2,141.8 2,375.6 2,275.7 2,297.3

Source: Canadian Television Fund.Some totals may not add due to rounding.

Exhibit 3 - 52: CTF contributions to television production, by genre

( $ millions) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Documentary 23.8 28.4 32.5 31.8 44.0 55.7 50.0 44.6 46.5 48.3 51.6Children’s & Youth 40.0 33.9 37.3 28.3 31.1 48.8 58.1 40.5 45.0 46.3 46.3Drama (fiction) 113.3 89.1 122.0 115.1 113.1 111.8 135.8 126.1 133.8 146.3 143.6Variety & Performing Arts 4.5 1.6 7.2 6.0 6.2 10.6 10.4 7.7 10.2 8.0 10.2

Total 181.6 153.0 199.0 181.2 194.4 226.9 254.3 218.9 235.5 248.9 251.7

Percent of totalDocumentary 13.1% 18.6% 16.3% 17.5% 22.6% 24.5% 19.7% 20.4% 19.7% 19.4% 20.5%Children’s & Youth 22.0% 22.2% 18.7% 15.6% 16.0% 21.5% 22.8% 18.5% 19.1% 18.6% 18.4%Drama (fiction) 62.4% 58.2% 61.3% 63.5% 58.2% 49.3% 53.4% 57.6% 56.8% 58.8% 57.0%Variety & Performing Arts 2.5% 1.0% 3.6% 3.3% 3.2% 4.7% 4.1% 3.5% 4.3% 3.2% 4.1%

Total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

Source: Canadian Television Fund.Some totals may not add due to rounding.

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Exhibit 3 - 50: Number of full-time equivalent jobs (FTEs) generated by CTF-supported production

Indirect Jobs

Direct JobsFT

Es

0

5,000

10,000

15,000

20,000

25,000

6,900 6,6008,900

6,700 7,100 8,100 8,2006,900 7,500 8,200 8,600

11,100

18,00017,200

23,200

17,40018,400

21,000 21,300

18,00019,500

21,30022,400

10,600

14,300

10,700 11,30012,900 13,100

11,10012,000

13,100 13,800

Source: Estimates based on data from the Canadian Television Fund and Statistics Canada.


Profi le 2008


54 Profi le 2008

3.2.12 Treaty Co-Production

Canada’s volume of international treaty co-production in the television sector totalled $178 million in 2007. Canada had a total of 35 treaty co-production projects in the television sector in 2007. The Canadian budgets of these 35 projects totalled $81 million, while the foreign budgets totalled $97 million. The average size of Canada’s television treaty co-production projects decreased slightly in 2007 to $5.1 million.

France maintained its position in 2007 as Canada’s largest bipartite partner for television treaty co-productions. Canadians partnered with French producers to make 12 television projects with total budgets of $56.3 million. Ireland moved past the U.K. in 2007 to become Canada’s second largest partner for television projects. Canadians produced two television projects with Irish producers in 2007 with total budgets of $43.4 million.The U.K. was Canada’s third largest partner in 2007, with $24.2 million in production volume in 2007.

Canadian producers were involved in four multipartite television treaty co-productions in 2007, with combined budgets of $27.2 million.

While the children’s and youth genre had, for the last few years, been the leading genre of Canada’s television treaty co-production, in 2007, the drama genre accounted for the largest share.

Canadians produced only fi ve television programs in the drama genre under international treaties; however, these programs generated total budgets of $82 million, and accounted for 46% of total treaty co-production for the television market.

Children’s and youth television production made under international treaties totalled $63 million, or 35% of total television treaty co-production.

The number of television-documentary projects made by Canadians under international treaties was unchanged in 2007, at 20. However, the value of the total budgets of these documentaries dropped slightly, to $32 million.

Exhibit 3 - 53: Treaty co-production with Canada in the television sector

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Foreign budgets 134 117 161 183 277 274 183 143 117 128 124 97Canadian budgets 116 105 218 211 387 313 185 125 104 100 93 81Total volume 250 222 379 394 664 587 368 268 221 228 217 178

Number of projects 31 37 60 53 76 82 78 55 55 52 41 35Average project budget 8.1 6.0 6.3 7.4 8.7 7.2 4.7 4.9 4.0 4.4 5.3 5.1

Source: Telefilm Canada.Note: Statistics subject to change.

( $ millions unlessotherwise specified)


Profi le 2008 55

Country

Bipartite France 15 70.8 12 56.3Ireland 2 41.6 2 43.4United Kingdom 13 62.4 11 24.2Luxembourg - - 1 10.7Australia 2 6.4 1 6.6Germany 2 1.1 3 6.3Philippines 2 13.1 1 3.3Total Bipartite 36 195.4 31 150.8 MultipartiteSouth Africa-UK - - 1 13.1Australia-Singapore - - 1 8.7UK-Romania 1 7.2 1 4.8Germany-Greece - - 1 0.6Germany-Ireland 1 5.3 - -Germany-South Korea 1 4.5 - -France-South Africa 1 2.3 - France-Israel 1 1.8 - -Total Multipartite 5 21.1 4 27.2

Grand Total 41 216.5 35 178.0

Number

of

Projects

Total

volume

($ millions)

Exhibit 3 - 54: Treaty co-production with Canada in the television sector,by partner country, 2006 and 2007

2006Number

of

Projects

Total

volume

($ millions)

2007

Source: Telefilm Canada.Note: Total volume refers to the global budget rather than only the Canadian portion of the budget. Statistics subject to change.

Exhibit 3 - 55: Volume of international treaty co-production for the television market, by genre

2001 2002 2003 2004 2005 2006 2007

Total volume of production ($ millions)Drama 267 171 30 51 42 66 82Documentary 39 57 28 43 51 34 32Children’s & Youth 280 138 211 124 133 116 63Other -- 2 -- 3 2 -- --Total 587 368 268 221 228 216 178

Number of projectsDrama 14 12 5 4 3 5 5Documentary 32 47 27 31 29 20 20Children’s & Youth 36 18 23 18 19 16 10Other -- 1 -- 2 1 -- --Total 82 78 55 55 52 41 35

Average project budgets ($ millions) Drama 19.1 14.3 6.0 12.8 14.0 13.2 16.4Documentary 1.2 1.2 1.0 1.4 1.8 1.7 1.6Children’s & Youth 7.8 7.7 9.2 6.9 7.0 7.3 6.3Other -- 2.0 -- 1.5 2.0 -- -- Total 7.2 4.7 4.9 4.0 4.4 5.3 5.1

Source: Telefilm Canada.Note: Total volume refers to the global budget rather than only the Canadian portion of the budget. Statistics subject to change.


Profi le 2008


56 Profi le 2008

3.2.13 Audiences

Between September 2005 and May 2006, the share of viewing to Canadian programs remained much lower in the English-language market than in the French-language market, particularly in the drama genre.

In the English-language market:

• Canadian drama programs captured 17% percent of the viewing to all drama programming on Canadian television.

• Canadian documentaries accounted for 65% of viewing to all television documentary programs.

• Canadian children’s and youth programming accounted for 48% of total viewing to children’s programming.

• In the variety and performing arts genre, Canadian programs captured 35% of total viewing.

• Overall, Canadian programming across all genres accounted for 44% of total viewing; foreign programming accounted for the remaining 56% of total viewing.

Canadian programming continued to hold a strong share of audiences in Canada’s French-language market between September 2005 and May 2006.

• Canadian drama (fi ction) programs captured 42% of the viewing to all drama programming on Canadian television.

• Canadian documentaries accounted for 82% of viewing to all television documentary programs.

• Canadian children’s and youth programming accounted for 66% of total viewing to all children’s and youth programming.

• In the variety and performing arts genre, Canadian programs captured 90% of total viewing.

• Overall, Canadian programming across all genres accounted for 66% of total viewing in Canada’s French-language market; foreign programming accounted for the remaining 34% of total viewing.

Exhibit 3 - 56: Television audience share toCanadian programming, English-language market, September 2005 to May 2006

Drama

Documentary

Children’s &Youth

Variety &Performing Arts

All genres

0 20 40 60 80 100

17%

65%

48%

35%

44% 56%

65%

52%

35%

83%

Share of total viewing

Source: CTF and BBM Nielsen

Exhibit 3 - 57: Television audience share toCanadian programming, French-language market, September 2005 to May 2006

Drama

Documentary

Children’s &Youth

Variety &Performing Arts

All genres

17%

65%

48%

35%

44% 56%

65%

52%

35%

85%

0 20 40 60 80 100

42%

82%

66%

90%

66% 34%

10%

34%

18%

58%

Share of total viewing

Source: CTF and BBM Nielsen


Profi le 2008 57

Top-Rated Television Programs

American-produced television programs occupied all ten spots on the list of the top-rated television series in Canada between September 2006 and May 2007 when measured on the basis of Average Minute Audience (AMA).

• C.S.I. was the leading television series in Canada, with an AMA of just over three million persons aged two and over.

• No Canadian-produced series made it into the top ten between September 2006 and

May 2007.

Top-Rated Canadian-Produced

Television Programs

The leading Canadian-produced French-language programs between September 2006 and May 2007 included:

• the dramatic series, Lance et compte : La revanche, Nos étés, Le Négociateur;

• the teleromans, Les Poupées russes, Annie et ses hommes; L’auberge du chien noir;

• the comedy series, Taxi 0-22, Le Petit Monde de Laura Cadieux, Bob Gratton: Ma vie, my life; and,

• the comedy-sketch program, Le Sketch Show;

In the English-language market, the list of top ten television programs included:

• the comedy series, Corner Gas, Little Mosque on the Prairie, Rick Mercer Report, This Hour Has 22 Minutes, Winnipeg Comedy Festival, and Halifax Comedy Festival;

• the current-affairs programs, W-Five and W-Five Presents;

• the dramatic series, Degrassi: The Next Generation; and,

• the documentary series, Hockey: A People’s History.

Exhibit 3 - 58: Top ten television series in Canada, September 2006 to May 2007

Program (country of origin)

1. C.S.I (U.S.) 3,0472. American Idol 6 - Performance Show (U.S.) 2,8303. American Idol 6 - Results Show (U.S.) 2,6304. C.S.I. Miami (U.S.) 2,2735. Desperate Housewives (U.S.) 2,2616. Grey’s Anatomy (U.S.) 2,1737. House (U.S.) 2,1278. Criminal Minds (U.S.) 2,0779. E.R. (U.S.) 2,01110. Law & Order: SVU (U.S.) 1,773

Average MinuteAudience* (000s)

Source: CTF and BBM Nielsen * Average Minute Audience (Aged 2+) – the number of viewers, aged two and over, tuned to the average minute of a program. Note: The list of top television programs is based only on television programs in the CTF-supported genres (drama, children’s and youth, documentary, and variety and performing arts).

Exhibit 3 - 59: Top ten Canadian television series in the French-language market,September 2006 to May 2007


1. Lance et compte : La revanche 1,7162. Taxi 0-22 1,5253. Les Poupées russes 1,4784. Le Petit Monde de Laura Cadieux 1,3285. Annie et ses hommes 1,3266. Nos étés 1,3157. Le Négociateur 1,2028. Bob Gratton: Ma vie, my life 1,1749. Le Sketch Show 1,06310. L’auberge du chien noir 1,052



Exhibit 3 - 60: Top ten Canadian television series in the English-language market,September 2006 to May 2007


1. Corner Gas 1,5052. Little Mosque on the Prairie 1,0623. W-Five 7564. Rick Mercer Report 7145. This Hour Has 22 Minutes 5976. Degrassi: The Next Generation 4967. Winnipeg Comedy Festival 4958. Halifax Comedy Festival 4719. W-Five Presents 45710. Hockey: A People’s History 415




58 Profi le 2008

3.3 Theatrical Production

Canadian theatrical production (or theatrical-release production) includes feature fi lms and short fi lms made with movie theatres as the primary venue for initial release to the public.

In recent years, many Canadian theatrical fi lms, such as Les 3 P’tits cochons, Nitro, Eastern Promises, Away From Her, Shake Hands with the Devil, and À vos marques… Party! have had strong box offi ce runs and critical acclaim.

3.3.1 Volume

The total volume of Canadian theatrical production decreased by 14% in 2006/07, even as the annual number of Canadian theatrical fi lms reached an 11-year high. The total volume of Canadian theatrical

production decreased to $282 million in 2006/07, from $329 million the year before. Despite this decrease in production volume, the annual number of theatrical fi lms made by Canadian producers increased to 96 in 2006/07, from 85 the year before.

• Canadian theatrical production totalled $282 million in 2006/07, a decrease of 14%.

• Canadian producers made 96 theatrical fi lms in 2006/07, up from 85 in 2005/06.

• Canadian theatrical production generated an estimated 7,500 FTEs, including 2,900 FTEs employed directly in production.

• English-language production fell 32% to a total of $179 million, although the number of English-language fi lms actually rose from 56 to 57.

• The number of French-language fi lms jumped from 27 to 36 as the volume of production increased by 61% to a total of $98 million.

• There were 86 Canadian theatrical fi lms made in the fi ction genre, accounting for 95% of the total volume of production.

• The average budget of English-language fi lms fell to $3.1 million, from $4.7 million the year before. The average budget of French-language fi lms increased to $2.7 million from $2.3 million in 2005/06.

• The share of the number of fi lms with budgets over $10 million dropped to 2% from 5% in 2005/06; while the share of fi lms with budgets between $1 million and $4.99 million increased from 46% to 58%.

• Quebec-based producers accounted for 44% of the total volume of Canadian theatrical production.

• Public sources accounted for 58% of total fi nancing of Canadian theatrical-release fi lms.

• Canada’s volume of international treaty co-production in the theatrical sector jumped by 48% in 2007 to reach a total of $300 million; this increase followed a rise of 37% in 2006.

• France was Canada’s largest bipartite partner for theatrical treaty co-production in 2007; the two countries partnered for over $146 million in production.

• A total of 629 fi lm titles played in Canadian theatres in 2007; of this total, 112 were Canadian fi lms.

• Canadian fi lms’ share of the Canadian box offi ce dropped to 3.2% in 2007, from 4.2% in 2006.

Highlights


Profi le 2008 59

Exhibit 3 - 62: Number of Canadian theatrical films produced in Canada on an annual basis

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

57

64

52

70

6367

78

92

63

85

96

Num

ber o

f film

s

0

20

40

60

80

100

Source: Estimates based on data collected from CAVCO.

Exhibit 3 - 61: Total volume of Canadian theatrical production

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

186

249

201

226 228

279

342

177

329

282

227

$ m

illio

ns

0

50

100

150

200

250

300

350



Profi le 2008


60 Profi le 2008

3.3.2 Employment

The production of Canadian theatrical fi lms generated an estimated 7,500 FTEs in Canada in 2006/07. This amount included 2,900 FTEs directly in the production of Canadian theatrical fi lms, as

well as 4,600 FTEs in other parts of the Canadian economy. The number of FTEs generated by Canadian theatrical production dropped by 15% in 2006/07, as the total volume of Canadian theatrical production dropped.

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Exhibit 3 - 63: Number of full-time equivalent jobs (FTEs) in Canadian theatrical production

Indirect Jobs

Direct Jobs

FTEs

0

2,000

4,000

6,000

8,000

10,000

2,2003,000

2,400 2,600 2,600 2,500 3,0003,600

1,800

3,400 2,900

3,600

4,800

3,8004,200 4,100

4,000

4,800

5,700

3,000

5,500

4,600

5,800

7,800

6,200

6,800 6,7006,500

7,800

9,300

4,800

8,900

7,500

Source: Estimates based on data from CAVCO and Statistics Canada. Note: Estimates of direct FTEs take into account annual changes in average wages.

3.3.3 Language

There was a sharp drop in the volume of Canadian theatrical production originally shot in English in 2006/07, even as the volume of French-language production expanded. In 2006/07, the volume of Canadian theatrical production originally shot in English fell 32% to a total of $179 million. Despite the signifi cant drop in production volume, the number of English-language fi lms actually rose from 56 to 57 in 2006/07. The number of French-

language fi lms jumped from 27 to 36 as the volume of production increased by 61% to a total of $98 million. Canadian producers also made three theatrical fi lms in other languages or bilingual format in 2006/07. These three fi lms generated a total volume of production of $5 million.


Profi le 2008 61

3.3.4 Genres

Canadian theatrical production in 2006/07 was concentrated in the fi ction genre; however both the documentary and children’s and youth genres experienced increased levels of Canadian theatrical production.

There were a total of 86 Canadian theatrical fi lms in the fi ction genre in 2006/07; these fi lms generated a total volume of $267 million. The number of

fi ction-genre fi lms rose by 12, while the volume of production contracted by $51 million in 2006/07.

There was one Canadian fi lm produced in the children’s and youth genre in 2006/07; it had a budget of approximately $7 million. The volume of Canadian theatrical production in the documentary genre doubled to $6 million in 2006/07, as the number of theatrical documentaries increased from fi ve to eight.

Exhibit 3 - 64: Volume of Canadian theatrical production, by language

Bilingual and other

French

English$

mill

ions

0

50

100

150

200

250

300

350

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

161

226

176 180 178 172

227 229

115

264

179

98

25

22

2641 40 56

1

4 10

2

32

5081

3

59

4

615

Source: Estimates based on data collected from CAVCO.Some totals may not add due to rounding.

186

249

201

226227 228

279

342

177

329

282

Exhibit 3 - 65: Number of theatrical films, by language

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

English 44 48 40 46 44 42 56 52 40 56 57French 13 15 12 23 17 25 21 36 21 27 36Bilingual and other 0 1 0 1 2 0 1 4 2 2 3

Total 57 64 52 70 63 67 78 92 63 85 96



Profi le 2008


62 Profi le 2008

Exhibit 3 - 67: Number of Canadian theatrical films, by genre

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Fiction 50 58 47 67 58 63 73 80 51 74 86Children’s & Youth 3 1 3 1 2 0 1 2 0 2 1Documentary 2 4 1 1 2 3 4 9 6 5 8Variety & Performing Arts 1 0 1 0 0 1 0 0 1 0 0Other 1 1 0 1 1 0 0 1 5 4 1

Total 57 64 52 70 63 67 78 92 63 85 96


Exhibit 3 - 66: Volume of Canadian theatrical production, by genre

($ millions) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Fiction 168 241 182 225 207 218 272 317 152 318 267Children’s & Youth 13 1 16 <1 8 0 4 1 0 2 7Documentary 4 7 3 <1 7 7 3 24 5 3 6Variety & Performing Arts 1 0 1 0 0 3 0 0 2 0 0Other 1 1 0 <1 6 0 0 0 18 7 1

Total 186 249 201 226 227 228 279 342 177 329 282

Source: Estimates based on data collected from CAVCO.Some totals may not add due to rounding.

3.3.5 Trends in Budgets

With the increase in the number of Canadian English-language theatrical fi lms in the fi ction genre and the drop in the volume of production in this market, the average budget fell to $3.1 million in 2006/07, from $4.7 million the year before. French-language feature-length fi lms actually experienced an increase in the average budget, from $2.3 million to $2.7 million. However, this increase was not enough to raise the overall average budget for Canadian theatrical fi lms in the fi ction genre.On an overall basis, across all languages (including Aboriginal-language and bilingual-formats), the

average budget for a Canadian feature-length fi lm in the fi ction genre dropped from $3.9 million to $2.9 million.

The share of the number of fi lms with budgets over $10 million dropped to 2% in 2006/07, from 5% in 2005/06. The share of fi lms with budgets in the $5 million to $7.49 million range held steady at 14%, while the share of fi lms with budgets between $1 million and $4.99 million increased from 46% to 58%. The share of fi lms with budgets under $1 million dropped slightly, from 25% in 2005/06 to 22% in 2006/07.



Profi le 2008 63

2006/07

2005/06

2004/05

Exhibit 3 - 69: Annual shares of theatrical feature film projets, by budget size

$20,000,000 and over

$10,000,000 to $19,999,999

$7,500,000 to $9,999,999

$5,000,000 to $7,499,999

$2,500,000 to $4,999,999

$1,000,000 to $2,499,999

under $1,000,000

0 5% 10% 15% 20% 25% 30% 35%

Source: Estimates based on data collected from CAVCO.Note: Budget calculations exclude the foreign budgets of treaty co-productions.

1%2%

2%4%

2%

14%14%

19%

28%22%

22%

28%

25%

30%

35%

24%14%

4%10%

share of number of projects

Exhibit 3 - 68: Trends in budgets of theatrical feature films (fiction genre only)

($ millions per film) 96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

English Average 3.7 4.7 4.4 3.9 4.0 4.1 4.0 4.4 2.9 4.7 3.1 Median 2.7 3.4 3.1 2.7 2.5 2.8 3.5 2.2 1.4 2.7 2.5French Average 1.9 1.5 2.2 1.8 2.3 2.2 2.4 2.3 2.8 2.3 2.7 Median 1.9 1.9 2.5 1.3 1.9 1.8 2.4 2.8 3.9 3.6 3.2All languages Average 3.3 3.9 3.9 3.2 3.6 3.4 3.6 3.7 2.8 3.9 2.9 Median 2.6 2.6 3.1 2.3 2.3 2.3 3.0 2.6 1.9 3.1 2.6

Source: Estimates based on data from CAVCO.Note: Calculations exclude the foreign budgets of treaty co-productions. All languages category includes films produced in Aboriginal and other languages as well as bilingual formats.



64 Profi le 2008

3.3.6 Production by Province Quebec returned to the position as the leading province for Canadian theatrical production in 2006/07, after briefl y yielding its long-held leadership in this sector to Ontario in 2005/06.

The volume of Canadian theatrical production by Quebec-based producers rose to $124 million in 2006/07 and accounted for 44% of the total volume of Canadian theatrical production during that year. Meanwhile, Ontario-based producers generated $90 million of theatrical production in 2006/07,

accounting for 32% of total Canadian volume. Ontario-based producers’ output dropped by 45% compared to 2005/06.

Theatrical production by B.C.-based producers also fell sharply in 2006/07: it dropped by 48%, from $60 million to $31 million.

The other provinces and territories with theatrical production in 2006/07 were Nova Scotia ($18 million), Manitoba ($10 million), Alberta ($5 million), and the Territories ($3 million).

Exhibit 3 - 70: Volume of Canadian theatrical production, by province

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Quebec 89 167 63 125 68 102 106 195 92 86 124 44%Ontario 75 45 78 33 70 90 87 119 67 165 90 32%British Columbia 18 20 46 44 59 29 48 17 10 60 31 11%Nova Scotia 2 6 4 0 0 3 4 8 5 11 18 6%Manitoba 2 3 5 2 5 3 6 1 2 3 10 4%Alberta 0 2 1 15 9 0 24 1 1 1 5 2%Territories* 0 0 0 0 0 0 0 0 0 3 3 1%New Brunswick 0 0 2 0 1 0 0 0 0 0 0 0%Newfoundland and Labrador 0 0 2 2 5 1 0 0 0 0 0 0%Prince Edward Island 0 0 0 0 0 0 0 0 0 0 0 0%Saskatchewan 0 6 0 5 9 0 4 0 0 0 0 0%

Total 186 249 201 226 227 228 279 342 177 329 282 100%

Source: Estimates based on data collected from CAVCO.Some totals may not add due to rounding.* Territories include Yukon, Nunavut and Northwest Territories.

( $ millions unless otherwise specified )

06/07(share)

3.3.7 Financing

Canadian theatrical production relies heavily on public sources of fi nancing, including direct funding from the Canada Feature Film Fund (CFFF), Société de développement des entreprises culturelles (SODEC), the Ontario Media Development Corporation (OMDC), other provincial fi lm agencies, as well as federal and provincial tax credits. In 2006/07 public sources (excluding public broadcasters) accounted for 58% of total fi nancing of Canadian theatrical-release fi lms.

While the public fi nancing for Canadian theatrical production increased in 2006/07, the level of foreign fi nancing dropped sharply: total foreign fi nancing dropped from $68 million in 2005/06 to only $17 million in 2006/07. As a share of total fi nancing, foreign sources dropped from 21% to 6%.

In terms of the overall distribution of fi nancing in 2006/07:

• Public sources (including CFFF) accounted for 36%, an increase of nine percentage points.


Profi le 2008 65

• Tax credits accounted for 22%, a decrease of one percentage point.

• Canadian distributors accounted for 13%, an increase of three percentage points.

• Foreign sources accounted for 6%, a decrease of 15 percentage points.

• Other private sources accounted for 13%, an increase of one percentage point.

• Production companies contributed 7% of fi nancing, an increase of two percentage points.

• Private and public broadcaster licence fees accounted for less than 3%, a slight decrease from the year before.

Exhibit 3 - 71: Financing of Canadian theatrical production


Private broadcaster licence fees 1% 3 2% 5 3% 12 2% 3 2% 8 2% 6Public broadcaster licence fees <1% 1 <1% 1 <1% 1 <1% 0 1% 3 <1% 1Federal tax credit 6% 15 6% 18 7% 25 7% 12 7% 23 5% 14Provincial tax credit 13% 29 11% 29 14% 49 14% 24 16% 52 17% 49Canadian distributor 19% 42 19% 54 10% 35 14% 25 10% 33 13% 36Foreign 19% 43 17% 46 26% 90 10% 17 21% 68 6% 17Production company 9% 21 8% 23 7% 25 6% 10 5% 15 7% 21Other public* 26% 60 28% 78 24% 83 35% 61 27% 89 36% 101Other private** 6% 15 9% 26 6% 22 13% 23 12% 39 13% 37

Total 100% 228 100% 279 100% 342 100% 177 100% 329 100% 282


01/02 02/03 03/04 04/05 05/06 06/07

3.3.8 Canada Feature Film Fund

The Canada Feature Film Fund (CFFF), established in 2000 and administered by Telefi lm Canada, is the federal government’s main program for the support of the Canadian theatrical fi lm industry. The CFFF is comprised of several component programs designed to support the various stages of the feature fi lm production cycle, from scriptwriting to marketing. The CFFF also encompasses programs to support low-budget independent fi lmmaking.

Unlike the CTF, the fi nancial resources for the CFFF are entirely comprised of contributions from the federal government.

In 2006/07, the CFFF provided a total of $96 million in fi nancial support to the development, production, distribution and marketing of Canadian feature fi lms.3 The $96 million in fi nancial assistance was comprised of $82.9 million in parliamentary appropriations received by Telefi lm Canada, and $13.2 million in recoveries by Telefi lm Canada from past investments in feature fi lm projects.4

3 Telefi lm Canada, Annual Report 2006-2007, p. 81. This amount also includes CFFF funding for Canadian fi lm festivals, participation in foreign festivals and markets, industrial and professional development, and advertising and promotion initiatives (see Telefi lm Canada, p. 100).4 Ibid.


66 Profi le 2008

Out of the total amount of CFFF fi nancial assistance, Telefi lm Canada provided $64 million in production funding to 44 feature fi lms, which, in turn, attracted an additional $98 million in fi nancing from other sources.

The ratio of CFFF fi nancing to other sources of fi nancing dropped sharply in 2006/07. In 2005/06, feature fi lm projects attracted $2.06 for every dollar of CFFF fi nancing; in 2006/07, this rate dropped to $1.53. Telefi lm Canada attributes this decreased fi nancial leverage largely to a drop in foreign fi nancing for CFFF-supported feature fi lms.

01/02 02/03 03/04 04/05 05/06 06/07

Exhibit 3 - 72: Total Canadian feature film production activity with CFFF contributions

Other financing*

CFFF production funding

$ m

illio

ns

0

50

100

150

200

250

300

4670 73 55 48 64

9899

130

188

101156

Source: Telefilm Canada.* Other financing includes contributions from production companies, broadcasters, other government sources and distributors.Note: Total budgets exclude the foreign portion of co-production budgets for which Canada is a minority partner.

202

171

261

185

147

162

Exhibit 3 - 73: Number of Canadian theatrical-release feature films that received financial support from the CFFF

Source: Telefilm Canada.

0

25

5041

47

43

32 31

44

01/02 02/03 03/04 04/05 05/06 06/07

Num

ber o

f film

s

Profi le 2008


Profi le 2008 67

3.3.9 Treaty Co-Production

Canada’s volume of international treaty co-production in the theatrical sector increased 48% to $300 million in 2007; this increase followed a rise of 37% in 2006. There were a total of 25 treaty co-

production projects in the theatrical sector in 2007. The Canadian budgets of these 25 projects totalled $114 million, while the foreign budgets totalled $185 million. The average size of theatrical treaty co-production projects increased to $12 million in 2007, from $9.7 million in 2006.

Exhibit 3 - 74: Treaty co-production with Canada in the theatrical sector

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Foreign budgets 29 93 94 110 127 94 81 172 112 69 125 185 Canadian budgets 33 95 92 104 102 95 96 197 106 79 78 114

Total volume 62 188 186 214 229 189 177 369 218 148 203 300

Number of projects 12 27 16 21 21 20 21 31 17 16 21 25Average project budget 5.2 7.0 11.6 10.2 10.9 9.5 8.4 11.9 12.8 9.3 9.7 12

Source: Telefilm Canada.Note: Some totals may not add due to rounding. Statistics are subject to change.

($ millions unless otherwise specified)

France moved ahead of the U.K. in 2007, to become Canada’s largest bipartite partner for theatrical treaty co-productions. Canadians produced nine theatrical projects with total budgets of $146.1 million with partners in France. The U.K. was still a major partner country for Canada in the theatrical market: with fi ve fi lms produced in 2007 and total budgets of $81.5 million. Among Canada’s other partner countries in 2007 were Germany, China, Switzerland and Czech Republic. China was the only other repeat partner country from 2006.

Canadian producers were involved in two multipartite theatrical treaty co-productions in 2007. Canada’s multipartite partners came from Japan, Brazil, Switzerland and France.

Number

of Projects

Total volume

($ millions)

Exhibit 3 - 75: Treaty co-production with Canada in the theatrical sector,by partner country, 2006 and 2007

Source: Telefilm Canada.Some totals may not add due to rounding.Note: Total volume refers to the global budget rather than only the Canadian portion of the budget. Statistics are subject to change.

Bipartite France 5 9 28.3 146.1 United Kingdom 4 5 82.4 81.5Germany - 2 - 19.0China 1 3 1.7 14.5Switzerland - 2 - 4.9Czech Republic - 2 - 3.1Greece 1 - 11.0 -Cuba 1 - 3.0 -Israel 1 - 2.1 -Morocco 1 - 1.9 -Uruguay 1 - 1.5 -Total Bipartite 15 23 131.9 269.1 MultipartiteJapan-Brazil - 1 - 26.8Switzerland-France - 1 - 3.7UK-South Africa 1 - 28.8 -Italy-Japan 1 - 24.4 -UK-Poland-Netherlands 1 - 6.5 -UK-Ireland 1 - 5.5 -Belgium-France 1 - 4.1 -France-Burkina Faso-Mali 1 - 1.7 -Total Multipartite 6 2 71.0 30.5

Grand Total 21 25 203.1 299.6

2006 2007 2006 2007Country


68 Profi le 2008

3.3.10 National Box Office Trends

Canadian theatres collected $858 million in box offi ce revenues in 2007 – an increase of 3% compared to 2006. American fi lms as well as other foreign fi lms increased their box offi ce revenues and market share in 2007 at the expense of Canadian fi lms.

• Canadian fi lms earned $28 million in 2007, a 20% decrease from 2006. Canadian fi lms saw their share of the domestic box offi ce drop to 3.2%, from 4.2% in 2006. A total of 112 Canadian fi lms played in Canadian theatres in 2007, up from 99 fi lms in 2006.

• American fi lms earned $763 million in 2007, an increase of 4% over 2006. American fi lms accounted for 88.9% of box offi ce receipts in Canada in 2007. A total of 312 American fi lms played in Canadian theatres in 2007, up from 295 in 2006.

• Other foreign fi lms earned $67 million in 2007, up 6% compared to 2006. Films from other foreign countries captured 7.8% of the Canadian box offi ce in 2007. The number of other foreign fi lms in Canadian theatres in 2007 decreased to 205, from 218 in 2006.

Exhibit 3 - 76: Canadian box office revenues, by origin of production

$ m

illio

ns

Source: Motion Picture Theatre Associations of Canada (MPTAC).Further detailed Canadian box office statistics are available from the Motion Picture Theatre Associations of Canada (MPTAC) which offers a subscription service. For more information call Adina Lebo, Executive Director, MPTAC, at (416) 969-7057. All box office statistics presented in Profile 2008 take into account information provided by MPTAC as of January 10, 2008.Note: Some totals may not add due to rounding.

0

200

400

600

800

1,000

2002

945

830

24

91

2003

957

866

33

57

2004

903

780

41

82

2005

834

713

46

75

2006

832

734

35

63

858

763

28

67

2007


Profi le 2008 69

Exhibit 3 - 77: Share of Canadian box office revenues, by origin of production

Source: Motion Picture Theatre Associations of Canada (MPTAC).Some totals may not add due to rounding.

0

20

40

60

80

100

2002

9.7%

87.8%

2.6%

2003

6.0%

90.5%

3.5%

2004

9.0%

86.4%

4.6%

2005

9.0%

85.5%

5.5%

2006 2007

7.6%

88.3%

4.2%

7.8%

88.9%

3.2%Nu

mbe

r of fi

lms

Exhibit 3 - 78: Number of films playing in Canadian theatres, by origin of production

0

100

200

300

400

500

600

700

Source: Motion Picture Theatre Associations of Canada (MPTAC).

2002

194

258

85

537

2003

184

247

99

530

2004

197

256

113

566

2005

202

257

105

564

2006 2007

218

295

99

612

205

312

112

629


Profi le 2008

3.3.11 Box Office Trends of Canadian Films, by Linguistic Market

When examined on the basis of Canada’s two major language markets for feature fi lms, the box offi ce performance of Canadian fi lms varies considerably. In Canada, the French-language market refers to all fi lms presented in French.

This includes fi lms for which the original language of production was French, as well as other fi lms dubbed into French, or presented with French subtitles. The English-language market refers to all fi lms presented in English (original language, dubbed or subtitled).


70 Profi le 2008

Canadian fi lms exhibited in the French-language market saw their market share decline in 2007, following a decrease in 2006. Canadian fi lms in the English-language market experienced a sharp drop in revenues and market share in 2007.

• In the French-language market, Canadian fi lms earned $20.8 million in 2007, down from $22.3 million in 2006.

• Canadian fi lms’ box offi ce share in the French-language market slid by nine-tenths of one percentage point to 16.2% in 2007.

• In the English-language market, Canadian fi lms earned $6.9 million – a drop of 45% compared to 2006.

• Canadian fi lms exhibited in the English-language market accounted for almost one percent of the total box offi ce, down from 1.7% in 2006.

• Canadian fi lms exhibited in the French-language market accounted for 75% of Canadian fi lms’ total box offi ce earnings in Canada in 2007; Canadian fi lms exhibited in the English-language market accounted for 25%.

• Canadian fi lms exhibited in the English-language market experienced almost twice the level of competition from foreign fi lms, when compared to the French-language market. In the English-language market, there were 7.0 foreign fi lms released in Canadian theatres in 2007 for every Canadian fi lm. In the French-language market, the ratio was 3.9 foreign fi lms for every Canadian fi lm released in Canadian theatres.

Exhibit 3 - 79: Canadian box office and market share, by linguistic market

2002 2003 2004 2005 2006 2007

French-language market($ millions)Box office of Canadian films in French 15.2 26.5 30.0 37.4 22.3 20.8Box office of foreign films in French 107.0 118.0 106.7 101.1 108.1 107.6Total box office of films in French 122.2 144.5 136.7 138.5 130.4 128.5Canadian films’ share 12.5% 18.3% 21.2% 27.0% 17.1% 16.2%(Number of films) Canadian films playing in Canadian theatres 52 68 86 80 79 84Foreign films playing in Canadian theatres 262 289 298 302 344 328Total films playing in Canadian theatres 314 357 384 382 422 412Ratio of foreign to Canadian films 5.0 4.3 3.5 3.8 4.4 3.9

English-language market($ millions) Box office of Canadian films in English 8.9 6.8 12.1 8.1 12.5 6.9Box office of foreign films in English 814 805.4 754.1 687.4 703.2 722.2Total box office of films in English 822.9 812.2 766.2 695.5 715.7 729.1Canadian films’ share 1.1% 0.8% 1.6% 1.2% 1.7% 0.9%(Number of films)Canadian films playing in Canadian theatres 60 56 67 62 57 63Foreign films playing in Canadian theatres 395 362 377 388 413 438Total films playing in Canadian theatres 455 418 444 450 470 501Ratio of foreign to Canadian films 6.6 6.5 5.6 6.3 7.2 7.0

Source: Motion Picture Theatre Associations of Canada (MPTAC).Note: The English-language market is comprised of all films that are shown in the English language, regardless of whether the original film was in English, dubbed into English, or exhibited with English subtitles. For the French-language market, all theatres in Canada (only Quebec and New Brunswick are captured at this point in time) showing films in French (original, dubbed, or with subtitles) would be tabulated in the French-language marketplace data. For example, along with all the original French-language films, the French subtitled version of the English film Spider-Man 3 would be included in the box office receipts for the French-language market. Please note that these markets are not province specific either. If a theatre in Quebec exhibited Spider-Man 3 in English, then the box office results would tabulated in the English-language market results.

Profi le 2008


Profi le 2008 71

Exhibit 3 - 80: Top ten films presented in the English-language market, 2007


1. Transformers 27.2 U.S.2. Spider-Man 3 26.9 U.S.3. Harry Potter and the Order of the Phoenix 26.9 U.S.4. Shrek the Third 24.2 U.S.5. Pirates of the Caribbean: At World's End 23.7 U.S.6. The Bourne Ultimatum 21.0 U.S.7. 300 20.5 U.S.8. The Simpsons Movie 16.3 U.S.9. Superbad 14.1 U.S.10. Knocked Up 13.4 U.S.

Box office receipts (millions)Title

Country of origin


1. Les 3 P'tits cochons 4.5 French2. Nitro 3.6 French3. Ma Fille mon ange 2.6 French4. À vos marques… Party! 2.0 French5. Ma tante Aline 0.9 French6. L'Âge des ténèbres 0.8 French7. Soie (Silk) 0.8 English8. J’ai serré la main du diable (Shake Hands with the Devil) 0.7 English9. Nos voisins Dhantsu 0.7 French10. Dinosaures 3-D : Les géants de la Patagonie (Dinosaurs 3D: Giants of Patagonia) 0.6 English

Exhibit 3 - 83: Top ten Canadian-produced films presented in the French-language market, 2007

Box office receipts (millions)

Originallanguage ofproductionTitle

3.3.12 Top Films, by Language of Presentation

A review of the top ten fi lms in each of Canada’s linguistic markets further underlines the fundamental differences between the two language markets in Canada.

• In the English-language market, there were no Canadian fi lms ranked among the top ten fi lms in 2007.

• In the French-language market, Canadian fi lms held three of the spots among the top ten fi lms in 2007.

1. Harry Potter et l’ordre du Phénix (Harry Potter and the Order of the Phoenix) 5.8 U.S.2. Spider-Man 3 4.7 U.S.3. Les Simpsons : Le Film (The Simpsons Movie) 4.6 U.S.4. Les 3 P’tits cochons 4.5 Canada5. Shrek le Troisième (Shrek the Third) 4.3 U.S.6. Pirates des Caraïbes : Jusqu’au bout du monde (Pirates of the Caribbean: At World’s End) 3.9 U.S. 7. Nitro 3.6 Canada8. Transformers : Le Film (Transformers) 2.7 U.S.9. Ma fille, mon ange 2.6 Canada10. La vengeance dans la peau (The Bourne Ultimatum) 2.1 U.S.

Exhibit 3 - 81: Top ten films presented in the French-language market, 2007



Countryof originTitle

1. Eastern Promises 2.9 English2. Away from Her 1.4 English3. Sharkwater 0.8 English4. Shake Hands with the Devil 0.3 English5. Partition 0.3 English6. Fido 0.3 English7. Silk 0.2 English8. Days of Darkness (L'Âge des ténèbres) 0.1 French9. Young Triffie 0.1 English10. Radiant City 0.1 English

Exhibit 3 - 82: Top ten Canadian-produced films presented in the English-language market, 2007



Originallanguage ofproductionTitle


72 Profi le 2008

4. Foreign Location ProductionThe foreign location production (FLP) sector includes feature films and television programs filmed in Canada by foreign studios and independent producers. In this type of production, the foreign producer retains the copyright, but Canada benefits in the form of jobs and economic activity. FLPs employ Canadian producers, performers, and crews to deliver films and television programs for global audiences.

72


Profi le 2008


Profi le 2008 73

4.1 Volume

After recovering in 2005/06, Canada’s FLP sector experienced a retreat in production volume in 2006/07, as the rising Canadian dollar and competition from other countries and U.S. states impacted on Canada’s position.

The total volume of FLP in Canada fell by 14% in 2006/07, decreasing from $1.7 billion to $1.4 billion. The drop in FLP was largely due to decreased

activity in the feature fi lm segment, as well as lower levels in the production of TV MOWs and mini-series (see Exhibit 4 - 5).

The decreases in FLP volumes were largely confi ned to the largest provinces of FLP – British Columbia and Ontario – with Ontario experiencing a signifi cant drop in production in 2006/07. Quebec, Nova Scotia, Alberta, and Manitoba all raised their levels of FLP in 2006/07.

• The total volume of FLP in Canada was $1.4 billion in 2006/07 – a decrease of 14% from almost $1.7 billion in 2005/06.

• There were a total number of 162 FLP projects in Canada in 2006/07 – a decrease of 24% from 207 in 2005/06.

• FLP generated an estimated 37,500 FTEs in 2006/07, including 14,400 FTEs directly in fi lm and television production.

• British Columbia accounted for 60% of all FLP volume in Canada in 2006/07.

• British Columbia, Ontario and Saskatchewan experienced decreases in FLP volume in 2006/07, while Quebec, Nova Scotia, Alberta and Manitoba raised their levels of FLP.

• The overall drop in FLP volume in 2006/07 was driven by lower levels of feature fi lm production in British Columbia and Ontario, as well as lower production levels for TV MOWs and mini-series.

• While the overall level of FLP volume dropped in 2006/07, the production of FLP television series increased – both in British Columbia and Ontario.

Highlights

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

Exhibit 4 - 1: Total volume of foreign location production

768 819

1,096

1,506

1,762 1,7601,914 1,904

1,463

1,666

1,435

$ m

illio

ns

0

500

1,000

1,500

2,000

Source: Association of Provincial Funding Agencies and the Department of Canadian Heritage.Note: The Association of Provincial Funding Agencies collects data for foreign location production from provincial film commissions and film development corporations.

Profi le 2008


74 Profi le 2008

4.2 Employment

The FLP sector continued to be a major source of production-industry employment and economic spin-offs in 2006/07. FLP generated an estimated

37,500 FTEs in Canada, including 14,400 FTEs directly in FLP, and a further 23,100 FTEs in other parts of the Canadian economy. Total FTEs fell by 16% in 2006/07, as the volume of FLP dropped.

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

FTEs

0

10,000

20,000

30,000

40,000

50,000

60,000

9,200 9,80012,900

17,60020,000 19,400 20,500 20,000

15,000

14,700 15,700

20,700

28,100

32,10031,100

32,800 32,000

24,000

17,10014,400

27,300

23,100

Exhibit 4 - 2: Number of full-time equivalent jobs (FTEs) in foreign location production

Indirect Jobs

Direct Jobs

Source: Estimates based on data from the Association of Provincial Funding Agencies, the Department of Canadian Heritage and Statistics Canada.Note: Estimates of direct FTEs take into account annual changes in average wages.

23,90025,500

33,600

45,700

52,10050,500

53,50052,000

39,000

44,400

37,500


Canada’s two largest provinces for FLP experienced decreases in production volume in 2006/07, while Quebec and several of the smaller FLP centres in Canada posted modest increases.

British Columbia was the largest province for FLP in 2006/07, with a total volume of $861 million. The province experienced a 12% decrease in FLP volume, as its annual number of FLP projects dropped from 94 to 79 (see Exhibit 4 - 6). Despite the drop in the province’s production volume and activity, 60% of FLP in 2006/07 took place in British Columbia.

The volume of FLP in Ontario dropped by $167 million, from $455 million to a total of $288 million in 2006/07 – a decrease of 37%. Quebec

experienced a 26% increase in its FLP, as the volume of FLP rose from $99 million to $125 million in 2006/07. A large part of the increase in Quebec can be traced back to a rise in the number of FLP feature fi lms shot in the province in 2006/07; the number of fi lms increased to 17 from 8 in 2005/06 (see Exhibit 4 - 6).

Nova Scotia posted a modest increase in FLP, from $61 million to $63 million. In Alberta, the increase in FLP was more pronounced, rising from $37 million in 2005/06 to $54 million in 2006/07. Manitoba also experienced an increase in FLP: its FLP volume rose from $34 million to $38 million.

FLP in Saskatchewan dropped for the second consecutive year. In 2006/07, the volume of FLP was down to $5 million, from $7 million in 2005/06.


Profi le 2008 75

Exhibit 4 - 3: Volume of foreign location production, by province

96/97 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07

British Columbia 362 425 445 664 760 857 830 1,236 567 973 861Ontario 253 221 347 443 543 561 549 340 521 455 288Quebec 87 129 197 213 337 215 399 193 261 99 125Nova Scotia 4 5 18 60 35 48 52 51 36 61 63Alberta 60 32 46 112 57 34 50 0 1 37 54Manitoba 0 7 27 7 25 33 34 79 54 34 38Saskatchewan 0 0 16 7 0 0 0 0 23 7 5Yukon Territory 2 0 0 1 2 1 0 2 <1 <1 <1New Brunswick 0 0 0 0 3 3 0 0 0 0 0Newfoundland and Labrador 0 0 0 0 0 8 0 0 0 0 0Prince Edward Island 0 0 0 0 0 0 0 2 0 0 0Northwest Territories 0 0 0 0 1 0 0 0 0 0 0Nunavut -- -- -- -- -- -- -- -- -- -- --

Total 768 819 1,096 1,506 1,762 1,760 1,914 1,904 1,463 1,666 1,435

Source: Association of Provincial Funding Agencies and the Department of Canadian Heritage.Note: Some totals may not add due to rounding.“--” Data not available or reported


Exhibit 4 - 4: Share of total volume of foreign location production, by province, 2006/07

Ontario, 20%

Quebec, 9%

Alberta, 2%

Yukon, <1%

Saskatchewan, <1%

British Columbia, 60%

Manitoba, 3%

Nova Scotia, 4%

Source: Association of Provincial Funding Agencies.



76 Profi le 2008

$ m

illio

ns

02/03 03/04 04/05 05/06 06/07

Exhibit 4 - 5: Total volume of foreign location production, by type of production

0

500

1,000

1,500

2,000

509

274353 278

186

507380320466

417

989

1,163

7891,008

742

Source: Association of Provincial Funding Agencies (data are not available for years prior to 2002/03).Note: Some totals may not add due to rounding.

1,915 1,904

1,463

1,666

1,435

4.4 Types

Even as the total volume of FLP decreased in 2006/07, television-series production in the FLP sector increased by 33%. Both Ontario and British Columbia experienced increases in television-series production, but British Columbia accounted for the majority of the increase. British Columbia was the location for the production of several American television series, including Battlestar Galactica, Bionic Woman, Men in Trees, Smallville, and Supernatural.

The production of other types of television programs dropped in 2006/07, as did the production of feature fi lms. The production of other types of television programs, including MOWs, mini-series and television pilots dropped by 33%, as a result of decreases in production activity in British Columbia, Ontario and Nova Scotia.

Signifi cant pullbacks in feature fi lm production in British Columbia and Ontario led to a 26% drop in this segment of the FLP sector. The annual number of foreign feature fi lms shot in British Columbia dropped from 42 in 2005/06 to 27 in 2006/07; in Ontario the annual number of foreign feature fi lms decreased from 25 to 17.


Profi le 2008 77

Exhibit 4 - 6: Annual number of foreign location projects, by province

02/03 03/04 04/05 05/06 06/07

British Columbia 65 69 68 94 79 Feature films -- 25 19 42 27 TV Series -- 15 21 13 25 TV Other -- 29 28 39 27Ontario 76 36 35 49 28 Feature films -- 14 13 25 17 TV Series -- 7 4 7 5 TV Other -- 15 18 17 6Quebec 39 40 38 22 23 Feature films -- 14 19 8 17 TV Series -- 6 10 5 0 TV Other -- 20 9 9 6Nova Scotia 13 8 8 14 5 Feature films -- 0 0 1 1 TV Series -- 2 2 3 0 TV Other -- 6 6 10 4Alberta 3 0 1 9 16 Feature films -- 0 0 2 4 TV Series -- 0 0 0 2 TV Other -- 0 0 7 10Manitoba 11 9 5 14 8 Feature films -- 5 1 7 6 TV Series -- 0 0 0 0 TV Other -- 4 4 7 2Saskatchewan -- 0 0 1 2 Feature films -- 0 0 1 2 TV Series -- 0 0 0 0 TV Other -- 0 0 0 0 Yukon Territory 4 3 1 4 1 Feature films -- 2 0 1 -- TV Series -- 0 0 0 0 TV Other -- 1 1 3 1New Brunswick -- 0 0 0 0 Feature films -- 0 0 0 0 TV Series -- 0 0 0 0 TV Other -- 0 0 0 0 Newfoundland and Labrador -- 0 0 0 0 Feature films -- 0 0 -- 0 TV Series -- 0 0 0 0 TV Other -- 0 0 0 0 Prince Edward Island -- 1 0 -- -- Feature films -- 1 0 -- -- TV Series -- 0 0 0 -- TV Other -- 0 0 0 --Northwest Territories -- -- -- -- -- Feature films -- -- -- -- -- TV Series -- -- -- -- -- TV Other -- -- -- -- --Nunavut -- -- -- -- -- Feature films -- -- -- -- -- TV Series -- -- -- -- -- TV Other -- -- -- -- --

Total 211 166 155 207 162

Source: Association of Provincial Funding Agencies (data are not available for years prior to 2002/03).“--” Data not available or reportedNote: Totals are based on available data and make no allowance for unavailable data.


78 Profi le 2008

5. Broadcaster In-House ProductionBroadcaster in-house production (“in-house production”) refers to productions made internally by private television broadcasters, the Canadian Broadcasting Corporation (CBC), Société Radio-Canada (SRC), and specialty- and pay-television services. In-house production is largely comprised of news and sports programming, but can also include production in other genres.

78


Profi le 2008


Profi le 2008 79

5.1 Volume

During the 2006 broadcasting year, in-house production increased by 11% to just over $1.1 billion. This increase followed a decrease of 6% in 2005.

• All of the broadcasting industry segments – private and public conventional television, specialty television, and pay television – recorded increases in in-house production in 2006 (see Section 5.2).

• Approximately 74% of the $112 million increase in in-house production can be attributed to higher spending in the specialty-television segment; spending in this segment was up by $83 million

over 2005. Public and private conventional broadcasters accounted for 24%, or $26 million, of the increase in 2006. Increased production in the pay-television segment amounted to $3 million (see Section 5.2).

• The rebound in in-house production was due in large part to resumption of professional hockey in 2005/06.

5.2 Segments

During the 2006 broadcasting year, and in prior years, most in-house production took place in the conventional television segment.

• In-house production reached an all-time high of just over $1.1 billion during the 2006 broadcasting year.

• In-house production rebounded by 11% in 2006, following a decrease of 6% in 2005.

• All of the broadcasting industry segments – private and public conventional television, specialty television, and pay television – recorded increases in in-house production in 2006.

• The sharp increase in in-house production can, in large part, be attributed to the resumption of the National Hockey League during the 2006 broadcasting year, following the cancelled hockey season the year before.

• In-house production generated an estimated 29,200 FTEs in Canada in 2006, including 11,200 FTEs employed by Canadian broadcasters directly in in-house production.

Highlights

Exhibit 5 - 1: Total volume of broadcaster in-house production

$ m

illio

ns

Source: Estimates based on data from CRTC and CBC/SRC.

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

790743 760

850 885963 997

1,0431,094

1,0321,144

Broadcasting year ending

0

300

600

900

1,200

Profi le 2008


80 Profi le 2008

• In 2006, in-house production by conventional television broadcasters increased by 4% to reach 717 million; in-house production in this segment accounted for 63% of total in-house production.

• In-house production by specialty television broadcasters totalled $418 million in 2006, or 37% of total in-house production. In-house production by specialty television services climbed 25% in 2006.

• Pay television services made expenditures of $9 million on in-house production, and accounted

for under 1% of total in-house production in 2006. In-house production among pay television services was up by 42% compared to 2005.

5.3 Employment

During the 2006 broadcasting year, in-house production generated an estimated 29,200 FTEs in Canada. This amount included 11,200 FTEs directly in in-house production at Canadian broadcasters, as well as 18,000 FTEs in other parts of the Canadian economy.

0

200

400

600

800

1,000

1,200

1996 1997 1998 1999 2001 2002 2003 2004 2005 20062000

Exhibit 5 - 2: Broadcaster in-house production, by segment

790743 760

850885

962996

1,0421,094

1,032

1,144$

mill

ions

135 107 166 198254219

293 312 333

8 6 987542233

335

418

652633

591650 662

705697

723 753 691

717

Source: Estimates based on data from CRTC and CBC/SRC.Some totals may not add due to rounding.


Exhibit 5-3: Number of full-time equivalent jobs (FTEs) in broadcaster in-house production

FTEs

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Source: Estimates based on data from CRTC, CBC/SRC and Statistics Canada.Note: Estimates of direct FTEs take into account annual changes in average wages.

0

10,000

20,000

30,000

9,500

15,200

24,700

8,900

14,200

23,100

9,000

14,300

23,300

9,900

15,900

25,800

10,100

16,100

26,200

10,600

17,000

27,600

10,700

17,100

27,800

10,900

17,500

28,400

11,200

17,900

29,100

10,300

16,500

26,800

11,200

18,000

29,200



Profi le 2008


Profi le 2008 81

Exhibit 5 - 4: Broadcaster in-house production, by province

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Ontario 415 387 402 461 486 528 566 588 647 592 683 60%Quebec 203 188 189 207 216 240 220 233 246 219 241 21%British Columbia* 58 58 60 62 62 65 69 92 87 96 93 8%Alberta 52 51 50 55 52 57 67 63 61 64 65 6%Nova Scotia 19 19 18 21 22 23 22 23 14 16 17 2%Manitoba 17 17 15 17 20 22 22 16 14 14 15 1% Saskatchewan 14 13 12 12 12 14 16 13 12 13 16 1%New Brunswick 7 7 8 8 8 8 8 8 8 8 8 1%Newfoundland and Labrador 4 4 4 5 5 4 5 6 5 8 5 <1%Prince Edward Island 1 1 1 1 1 1 1 1 1 1 1 <1%

Total 790 743 760 850 885 962 996 1,042 1,094 1,032 1,144 100%

Source: Estimates based on data collected from CRTC, CBC/SRC, and Statistics CanadaSome totals may not add due to rounding. * Includes the Territories.Note: A complete set of provincial statistics were not available for private broadcaster in-house production in the Prairie Provinces and Atlantic Canada. For the Prairie Provinces, Nordicity developed estimates based on the historical shares observed in the CRTC statistics prior to 2001 – before the CRTC began to suppress the provincial statistics. The breakdown of private broadcaster in-house production among the provinces in Atlantic Canada was also based on the development of estimates. Because no historical data existed, each province’s share of Atlantic Canada’s total GDP was used as the proxy variable for the estimate. CBC/SRC data was available on a provincial basis for 2002/03 to 2006/07. The average share across these five years was used to extrapolate provincial data back to 1996/97.

2006share of total



Most in-house production during the 2006 broadcasting year was concentrated in Ontario. Many of Canada’s English-language conventional broadcasters and specialty and pay television services are based in Ontario. In 2006, Ontario accounted for 60% of total in-house production with a total volume of $683 million. Ontario also accounted for 80% of the rise in total in-house production in 2006, with an increase of $91 million.

In Quebec, in-house production totalled $241 million in 2006 – an increase of 10% compared to

2005. As the home for most of Canada’s French-language conventional broadcasters and pay and specialty television services, Quebec accounted for 21% of total in-house production in 2006.

In-house production in British Columbia dropped slightly to $93 million in 2006 and accounted for 8% of the national total. In addition to the conventional broadcasters based in British Columbia, the province is home to specialty television, including Talentvision and ATN Zee.


82 Profi le 2008

Key Statistics on the Canadian Film and Television Market

1. Population of Canada (July 2007): 32,976,026

2. Per-capita spending on fi lm and television production in Canada (2006/07) $151

3. Number of private households (2006 Census) 12,437,470

4. Number of subscribers to multi-channel television programming services (2006): 9,978,000

5. Number of subscribers to cable-television services (2006): 7,350,000

6. Number of subscribers to direct-to-home (DTH) and multipoint distribution systems (MDS) (2006): 2,628,000

7. Number of subscribers to digital television services (September 2006): 5,789,700

8. Penetration of digital television services among subscribers to multi-channel television services (September 2006): 58%

9. Total number of television services available in Canada (December 2006): 662

10. Total number of Canadian television services available in Canada (December 2006): 500

11. Total number of non-Canadian television services available in Canada (December 2006): 162

12. Number of Canadian theatrical feature fi lms produced per one million inhabitants (2006/07): 2.7

13. Number of theatre admissions (2005) 105,190,134

14. Number of movie-theatre screens (2005): 2,826

Sources: 1. Statistics Canada; 2. CFTPA and Statistics Canada; 3. Statistics Canada; 4 – 11. CRTC; 12. CAVCO and Statistics Canada; 13-14. Statistics Canada.

Date post:	12-Nov-2014
Category:	Documents
Upload:	showbc
View:	2,289 times
Download:	2 times

2008 Economic Report on Film & TV Industry in Canada

Documents