Cinema Canada (Jun 1983)

———— —— ~ Ba RR a ————— ee aa SS JUN 2 & teed E MAG TRADE NEWS Broadcast Fund policies presented to producers for comment MONTREAL — At meetings in Montreal and Toronto with members of the Canadian production community, held May 16 and May 18 respectively, the Canadian Film Development Corporation (CFDC) presented its draft policies on the management of the $35 million Broadcast Program Development Fund, announced as part of Communications minister Francis Fox’s National Broadcast Strategy. In an accompanying letter, CFDC executive director André Lamy called for written comments on the proposed management policies. “As the fund begins operation July 1, 1983, it is essential that management policies be finalized prior to that date,” Lamy commented. The 15-page draft quotes extensively from the Feb. 21 Memorandum of Understanding between the minister of Communications and the CFDC for its definition of the purposes of the fund which will apply to television programming in drama, children’s programming and variety. One-third of the fund will be spent on French-language television programming and 2/3 in English-language programming. Half of the money from the fund shall be applied to productions to be exhibited by private over-the-air broadcasters in Canada and up to onehalf for productions to be exhibited by the CBC. Though the fund “recognizes the desirability’ of a singledefinition of Canadian content, applicable to that of the CRTC or the CCA, “the Fund is autono mous in its decisions, including decisions on Canadian content.” Although the CCA requires that one of the two highestpaid performers be Canadian, the Fund would entertain projects for two years using Canadians or landed immigrants in only two of the four highestpaid performer positions, to allow producers the “leadtime to adjust programming schedules.” — Production companies eligible to apply to the fund must be under Canadian control “and the producer shall obtain a licensing agreement from a Canadian television broadcaster before the Fund will consider an application.” The Fund will consider projects qualifying under Canada’s existing co-production treaties, as Well as future co-production agreements. The eligible producer must demonstrate to the Fund's satisfaction his or her capacity to financially substain the production; the broadcaster shall be contractually bound to the producer with respect to financial participation and intended time or date of broadcast ; and the financial consideration paid by the broadcaster shall be to the Fund's satisfaction. Acceptable projects will be “of high quality, attractive to peak viewing audience and where appropriate internationally attractive.” The fund can participate financially through 1) equity, (the Fund may require producer's financial participation) 2) a guaranteed loan, (contract pro (Cont. on p. 7) First Choice falters, UK fund .MONTREAL —At presstime Cinema Canada learned that First Choice will freeze some $7 mln. in contracts for Canadian shows planned for this year. The 25% shortfall means an estimated $21 million will be spent on Canadian content in 1983, $7 million lower than the $28 million originally planned. The freeze is due to diminished numbers of paying subscribers — an estimated 400,000 by end '83 instead of an initial estimate of 600,000. First Choice, with monthly revenues of $2.5 million, has spent $19 million in capital and is relying on credit to keep up its cash flow. A $50 million private pay Cable production fund, being pursued by British financier and program packer Kent Walwin of Yellowbill offered to discount First Choice’s equity in return for a 20% participation from First Choice in the fund, according to trade sources. Walwin is reported as saying that First Choice executives Victor Mashaal and senior programs Phyllis Switzter and Riff Markowitz generally support the fund. The fund would produce “cheap” U.S. programming that would qualify as Canadian content or would be tailored to qualify under the official Canada-UK co-production treaty which is under negotiation for amendment to include television production, The fund would derive 20% of its money from Walwin’s Yellowbill interim-finance company, already backing at least two Montreal productions, 20% from First Choice, 40% from a U.S. pas cable outfit, and 20% from othet foreign sources. MONTREAL — Reactions to the CFDC’s proposed management policies for the Canadian broadcast program development fund run the gamut from relatively negative in Montreal, increasingly positive in Toronto to distantly hopeful in Alberta. In many cases many of the consulted parties have gone into a week of executive meetings to prepare detailed responses as well as criticisms of the draft policies. ‘My reaction is one of disappointment and alarm,” said Paul Siren of the Federation of Canadian Guilds and Unions in Film and Television, speaking of the consultative meeting in Toronto May 18. “At the meeting in Montreal, May 16, I thought I would see an explosion of joy,” Nicole M. Boisvert, president of the 51member Association des producteurs de films du Quebec (APFQ), told Cinema Canada. “This was going to be the end of the tunnel. Instead it was a funeral — the burial of the independent producer in this country.” Siren, reporting to the Federation’s national executive on May 28-29, said the federation would subsequently call a pressconference to make public its objections to the proposed management policies. Siren said the Canadian content policies “reverse all the practices and immigration policies established with respect to the use of on-camera Canadian talent. “The policies suggest that Canadian production will be primarily co-productions with American producers for American channels. This is not to purpose of the cultural measures proposed by the minister (of Communications).” There was “no debate, no discussion” Siren said, at the Toronto meeting which drew an overflow crowd of some 40 50 people from the production community. After a week of consultation, Boisvert found that the Quebecbased APFQ’s reaction to the proposed policies “exactly matched Toronto reactions.” “I want this fund to work,” Boisvert told Cinema Canada, “and I hate being negative. So we're working out a very detailed response to the policies. I have some 50 questions I'd like to get cleared up and, as you know, people at the CFDC aren't exactly easy to reach. Until we have those answers, I can only respond to the policies with a lot of reservations. “Broadly speaking, the policies put the independent producer entirely at the mercy of CBC/Radio-Canada and _ the CFDC. Now the CFDC only contributes one-third of the production money, and the producer two-thirds, so how is it that the CFDC gets to define all the terms ? Ifs worrisome, to put it mildly. “Secondly, there's a tremendous intrusion by the state on the level of scenarization and contracts. The policies speak of a CFDC contract between itself and the independent producer. Well, we'd like to see that contract; we don’t even know any of the terms. And we're expected to provide two-thirds of the money. “As well, the CFDC is granted what amounts to censorship powers on the level of the script. There are fundamental liberties at issue here : what about the freedom to create? “Who is going to be in charge of the fund ? There’s going to have to be a specific person and it makes a big difference who that person will be. Also we wouldn't like the CFDC to hire on a lot of people to administer the fund and have it melt away under the weight of its administration. These are just some of the questions we'd like clarified. “It seems clear that according to the policies it’s the broadcasters who become the big bosses. The independent producer is reduced to being a gobetween who'll only produce what is acceptable to the broadcasters. And even there, political decisions were taken to exclude the provincial-owned broadcasters from the fund: for francophone producers the lack of access to Radio-Québec and TVOntario makes a considerable difference in terms of market. “None of this makes life any easier for us. There’s a war of exclusion going on between the CBC and pay-TV. We now have to choose either one or another. What sort of progress is this for the independent producer? It does nothing to increase our domestic market ~and that’s the rationale behind all this. We were always told that these measures would enlarge the domestic market by 15-20%. They don’t. “Our greatest preoccupation is the lack of overall vision. In order to respond properly to these initiatives, it would have helped to know what's in the Cohen distribution report, or in the film policy. But we don't have them. “This sort of project-by-project approach has got to cease,” Boisvert concluded. In Toronto, the Canadian Film and Television Association (CFTA) has called a meeting of its members to pool reactions to the proposed policies. “I think basically the policies are heading in the right direction,” Michael MacMillan of Atlantis Films told Cinema Canada. “The draft suggests flexibility and Andre Lamy said there would be a flexible approach. I think that’s the right approach. (Cont. on p. 7) Cineplex registers profit despite Major trouble TORONTO -— Cineplex Corp. president Garth Drabinsky has announced that the company reported a profit before extraor dinary items of $50,473 on revenues of $7.02 million in its first quarter ending March 31, the organization's first quarterly profit since its formation as an integrated company. In addition, a special gain from recovery of income taxes due to previous losses raised net income to $103,973. Drabinsky credited sales by the Pan Canadian distribution division of the company to payTV and entry into the video cassette Wholesale business for the revenue gains. The company’s guaranteed sales to pay-TV total nearly $5.8 million, while first quarter sales of video cassettes brought in $440,000. Cineplex, in the 11 months ending Dec. 31, 1982, lost $15.5 million, or $3.09 per share, on revenues of $20.3 million and a $24.6 million deticit. The company’s working Capital deficit is now $947,142, down from $34 million last June. In its first quarter, Cineplex paid down $913,301 of its long-term debt, which stood at $13.8 million on Dee, 31. Cost-cutting moves have also reduced projected eapenses by $3 million. Drabinsky blamed high interest rates and the “anti-competitive nature’ of film distribution in Canada as reasons tor Cineplex's poor financial showing in 1982. Aruling by the Restrictive Trade Practices Commission, based on an application tiled by the director of invest: gation and research under the Combines Investigation Act, is scheduled tor June 8 Latest reports at presstime have it that a first-run deat has been struck with the Majors, subject to the adjournment of the commission hearings. Cinema Canada June 1983/3