Canadian TV Fund in watchdog's eye

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OTTAWA -- Canada's TV watchdog on Tuesday formed a task force to revamp the Canadian Television Fund after threats to its survival from dissident cablecasters.

The Canadian Radio-television and Telecommunications Commission said the regulator's broadcasting vice-chair Michel Arpin will head up a task force charged with resolving "long-standing concerns" by cablecasters over how the CTF is run and hands out subsidies to independent producers.

The CTF is the main source of investment for Canadian producers looking to get their homegrown shows onto primetime schedules and into foreign markets.

The CTF equity comes in part from CRTC-mandated contributions from domestic cablecasters and other content carriers.

But rebel media companies Shaw Communications Inc. and Quebecor Media Inc. said last month they would halt contributions to the CTF and make their own arrangements for investments in homegrown production.

But after the CRTC intervened, Shaw and Quebecor agreed to resume equity contributions to the CTF, while urging reform of the industry fund.

Shaw Communications CEO Jim Shaw Jr. on Tuesday told an all-parliamentary committee on Canadian Heritage in Ottawa that he would bow to the CRTC's order, but added the CTF was "flawed and broken and it has to be fixed or it won't go anywhere."

After consultations with industry players and the public, the CTF task force will issue its recommendations in a report by Aug. 31.

The earlier threats by Shaw Communications and Quebecor Media provoked anger by independent producers and calls for the CRTC to bring the revolting cablecasters into line.

Shaw told the parliamentary committee that he changed his mind over helping finance the CTF to help stabilize the industry.

But he also said the decision to withdraw its payments made the production industry stronger because the move ensured problems with the fund were highlighted and likely to be dealt with.

Shaw repeated an earlier insistence that CTF money was going to Canadian programming that wasn't drawing domestic primetime audiences, and called for some kind of criteria to judge the fund's performance.

But the Canadian Association of Broadcasters, representing private broadcasters, urged the CRTC to hold other content carriers to their financial obligations.

"No one player can decide to unilaterally withhold payments when it no longer suits their purpose," CAB president and CEO Glenn O'Farrell said during his own appearance Tuesday before the parliamentary committee.

Quebecor Media Inc. president and CEO Pierre Karl Peladeau last week insisted the CTF was incapable of dealing with new distribution technologies, such as YouTube.

He added Quebecor that video-on-demand product, which it offers through its cable division Groupe Videotron Ltd., should be eligible for CTF funding.
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