Profile 2012 An Economic Report on the Screen-based Production Industry in Canada

Profile 212 An Economic Report on the Screen-based Production Industry in Canada

c2 Profile 212

Produced by the CMPA and the APFTQ, in conjunction with the Department of Canadian Heritage. Production facts and figures prepared by Nordicity Group Ltd. Profile 212 1

title goes here The report is published by the Canadian Media Production Association (CMPA). Profile 212 marks the 16th edition of the annual economic report prepared by CMPA and its project partners the Association des producteurs de films et de télévision du Québec (APFTQ), the Department of Canadian Heritage, and Nordicity Group Ltd. Profile 212 provides an analysis of economic activity in Canada s screen-based production industry during the period April 1, 211 to March 31, 212. It also provides comprehensive reviews of the historical trends in production activity between the fiscal years of 22/3 and 211/12. Ottawa 61 Bank Street, 2nd Floor Ottawa, ON K1S 3T4 Tel: 1-8-656-744 (Canada only)/ 613-233-1444 Fax: 613-233-73 Email: ottawa@cmpa.ca www.cmpa.ca Toronto 16 John Street, 5th Floor Toronto, ON M5V 2E5 Tel: 1-8-267-828 (Canada only)/ 416-34-28 Fax: 416-34-499 Email: toronto@cmpa.ca Vancouver 736 Granville Street, Suite 6 Vancouver, BC V6Z 1G3 Tel: 1-866-39-7639 (Canada only)/ 64-682-8619 Fax: 64-684-9294 Email: vancouver@cmpa.ca At the CMPA: Susanne Vaas Vice-president, Business Affairs & Secretary Designate APFTQ 145 City Councillors, Suite 13 Montréal, QC H3A 2E6 Tel: 514-397-86 Fax: 514-392-232 Email: info@apftq.qc.ca www.apftq.qc.ca At the APFTQ: Claire Samson President and CEO Department of Canadian Heritage 15 Eddy Street Gatineau, QC K1A M5 Tel: 1-866-811-55/819-997-55 TTY/TDD: 819-997-3123 Email: info@pch.gc.ca www.canadianheritage.gc.ca At the Department of Canadian Heritage: Lynn Foran Manager, Film and Video Policy and Programs Cultural Industries Vincent Fecteau Senior Research Analyst Research and Policy Cultural Industries Katka Selucky Senior Policy Analyst Film and Video Policy and Programs Cultural Industries 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. Nordicity Group Ltd. Peter Lyman, Senior Partner Dustin Chodorowicz, Partner Kristian Roberts, Manager Nordicity is a leading international consulting firm providing strategy and business, economic analysis, and policy and regulation solutions to private and public sector clients in the culture, communications and information technology industries. Cover design: Sarolta Csete Design: Parable Communications Translation: Louise F. Larkin Printing: The Lowe-Martin Group 2 Profile 212

Contents At a Glance: Screen-based Production in Canada.... 4 1. Screen-based Production in Canada.......... 6 Film and Television Production................. 7 Volume........................... 7 Employment and Gross Domestic Product (GDP)....... 8 Export Value......................... 9 Provinces and Territories.................. 1 Convergent Digital Media Production............. 12 Volume.......................... 12 Employment and GDP................... 13 Household adoption of video platforms.......... 13 2. Canadian Film and Television Production....... 15 Total Canadian Film and Television Production........ 17 Volume.......................... 17 Employment and GDP................... 18 Language......................... 19 Genres.......................... 2 Provinces and Territories.................. 3 Financing......................... 3 Audiovisual Treaty Coproduction.............. 31 Television Production..................... 34 Volume.......................... 37 Employment........................ 37 Types........................... 38 Genres.......................... 38 Budgets.......................... 39 Language......................... 4 Canadian Content Points.................. 42 Provinces and Territories.................. 43 Financing......................... 43 Broadcaster Licence Fees................. 45 Broadcaster Spending................... 46 Canada Media Fund.................... 48 Audiovisual Treaty Coproduction.............. 52 Audiences......................... 54 Theatrical Production.................... 58 Volume.......................... 6 Employment........................ 61 Language......................... 61 Genres........................... 62 Budgets.......................... 63 Provinces and Territories.................. 64 Financing......................... 64 Canada Feature Film Fund................. 65 Audiovisual Treaty Coproduction.............. 67 National Box Office Trends................. 69 Box Office by Linguistic Market............... 71 Top Films by Language of Presentation........... 72 Home Video and Television Market Share.......... 73 3. Foreign Location and Service Production....... 75 Volume........................... 78 Employment and GDP.................... 79 Provinces and Territories................... 8 Types............................ 8 Country........................... 81 4. Broadcaster In-House Production........... 82 Volume........................... 84 Employment and GDP.................... 85 Provinces and Territories................... 86 Notes on Methodology................. 87 Profile 212 3

Canadian Film and Television Production at a glance: Screen-based Production in Canada The screen-based production industry in Canada is a major source of economic activity and jobs for Canadians across the country. The industry comprises film and television production as well as convergent digital media production. The film and television production segment comprises three key sectors: 1. The Canadian Film and Television Production sector is the largest of the key sectors. It can be further subdivided into two subsectors: Television Production and Theatrical Production. Canadian production comprises films and television programs made largely by independent production companies, although it also includes television programs made by production companies affiliated with Canadian broadcasters. All of the television programs and films in the Canadian production sector are certified as Canadian content by either the Canadian Audio-Visual Certification Office (CAVCO) of the Department of Canadian Heritage or the Canadian Radio-television and Telecommunications Commission (CRTC). 2. The Foreign Location and Service Production sector is the second-largest segment and largely comprises feature films and television programs filmed in Canada by foreign producers or by Canadian service producers on behalf of foreign producers. The majority of foreign location and service production is made by producers based in the United States (U.S.); however, approximately 1% to 15% of the production activity in this sector is made by Canadian producers. 3. The Broadcaster In-House Production sector includes television programs made by Canadian television broadcasters in their own facilities, and comprises primarily news, sports and current affairs programming. The screen-based production industry also includes Convergent Digital Media Production, which is an emerging sector. Convergent digital media production comprises screen-based content and applications for digital media platforms (e.g., video games, interactive web content, on-demand content, podcasts, webisodes, and mobisodes), which are associated with films and television programs. Global production statistics in Profile 212 such as total film and television production in Canada do not include figures for convergent digital media production. Total film and television production in Canada Canadian film and television production 3, 2,956 6, 5, 4,988 4,97 4,559 4,917 5,1 5,355 5,12 5,46 5,579 5,893 2,5 2, 2,77 2,24 2,3 2,256 2,429 2,45 2,491 2,437 2,458 Total volume ($ millions) 4, 3, 2, Total volume ($ millions) 1,5 1, 1, 5 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada and Association of Provincial Funding Agencies. $5.89 billion in production volume 1 5.6% increase in production volume from 21/11 $2.23 billion in export value 132,5 full-time equivalent jobs (FTEs) 1 Production volume or volume of production refers to the sum of production expenditures (i.e., production budgets). 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO and CRTC. $2.96 billion in production volume 2.3% increase in volume from 21/11 $2.58 billion in television production $381 million in theatrical film production 663 television series 47 mini-series 87 theatrical feature films 66,4 FTEs 4 Profile 212

At a Glance: Screen-based Production in Canada Foreign location and service production Broadcaster in-house production 2, 1,8 1,6 1,4 1,914 1,94 1,462 1,669 1,433 1,77 1,445 1,58 1,874 1,675 1,3 1,2 1,1 1, 9 997 1,43 1,94 991 1,139 1,147 1,184 1,12 1,248 1,262 Total volume ($ millions) 1,2 1, 8 6 Total volume ($ millions) 8 7 6 5 4 4 2 3 2 1 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 22 23 24 25 26 27 28 29 21 211 Source: Association of Provincial Funding Agencies. Source: Estimates based on data from CRTC and CBC/Radio-Canada. $1.68 billion in production volume 1.6% decrease in production volume from 21/11 97 theatrical feature films 78 television series 57 MOWs, mini-series, pilots and other types television programs 37,7 FTEs $1.26 billion in production volume 1.1% increase in volume from 21/11 $725 million in conventional television expenditures $537 million in specialty and pay television expenditures 28,4 FTEs Convergent digital media production* $34.6 million in production volume 217 projects Average project size: $159, 8 FTEs * Convergent digital media production includes content developed for digital media platforms and integrated with a traditional audiovisual product (typically a television series) in order to enhance or deepen the audience experience of screen-based content. The Film and Television Market in Canada Population of Canada (212): 34.9 million 1 Per-capita volume of film and television production in Canada (211/12): $169 Number of private households (211): 13.3 million 1 Number of movie-theatre screens in Canada (21): 2,868 1 Number of paid theatre admissions in Canada (21): 112.2 million 1 Number of television services available in Canada (211): 72 2 Canadian television services: 48 2 Non-Canadian television services: 222 2 Percentage of households subscribing to multi-channel television programming services (211): 9% 2 Number of subscribers to multi-channel television programming services (211)*: 11.8 million 2 Cable-television and Internet protocol TV (IPTV) subscribers*: 8.5 million 2 Direct-to-home satellite (DTH) and multipoint distribution systems (MDS) subscribers: 2.9 million 2 Digital television penetration rate among multi-channel households (211): 8% 3 Sources: 1. Statistics Canada, 2. CRTC, 3. Mediastats. * Includes an estimate of subscribers to broadcasting distribution undertakings that did not report financial and operating data to the CRTC in 211. This estimate is not included in the statistics for cable, Internet protocol TV (IPTV) and direct-to-home (DTH) satellite television. Profile 212 5

1. Screen-based Production in Canada In 21/11, the screen-based production industry in Canada experienced a healthy 1.6% increase in the total volume of production, which was largely on account of a significant rise in FLS production. In 211/12, the industry continued to grow: the total volume of production expanded by 5.6% to a ten-year high of $5.9 billion. In 211/12, however, the industry s overall growth was almost entirely due to higher levels of Canadian production. While FLS production dropped by 1.6% to just under $1.7 billion, all other industry segments experienced increases in production activity. Broadcaster in-house production was 1.1% higher in 211/12; however, it was Canadian production, and in particular Canadian television production, that underpinned another successful year of growth for the industry. Canadian television production increased 21.3% in 211/12, to a ten-year high of just under $2.6 billion. While both the English- and French-language markets contributed to this increase, it was English-language fiction television production that really fuelled the rise in activity. In 211/12, the volume of English-language fiction television production climbed by 41.4% to just under $1.1 billion. A large portion of this increase was due to higher average hourly budgets, rather than more projects. Canadian theatrical production also reached a ten-year high, climbing by 14.1% to $381 million. As was the case with Canadian television production, both language markets contributed to the increase: English-language production increased by 15.4%, while French-language production rose by 11.2%. Most of the increase in the volume of Canadian theatrical production was due to higher budgets, since the number of projects actually decreased in 211/12. With these higher budgets came an influx of foreign financing. Indeed, the increase in production volume ($47 million) in 211/12 was nearly equivalent to the increase in the level of foreign financing of Canadian theatrical production ($55 million).

Screen-based Production in Canada Film and Television Production Volume Exhibit 1-1 Total volume of film and television production in Canada 6, 5, 4, Canadian television Canadian theatrical Foreign location and service 4,988 4,97 1,799 1,696 4,559 1,825 4,917 5,1 1,896 2,131 5,355 2,128 Broadcaster in-house 5,579 5,12 5,46 2,124 2,231 2,66 5,893 2,576 $ millions 3, 278 327 179 36 298 323 26 371 334 381 2, 1,914 1,94 1,462 1,669 1,433 1,77 1,445 1,58 1,874 1,675 1, 997 1,43 1,94 991 1,139 1,135 1,184 1,12 1,248 1,262 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada, and the Association of Provincial Funding Agencies. Notes: Some totals may not sum due to rounding. Exhibit 1-2 Total volume of film and television production in Canada, real inflation-adjusted 211 dollars 6, 5,811 5,632 Nominal dollars Real 211 dollars 5,595 5,742 5,893 5,5 5,353 5,34 5,38 5,289 5,73 5,893 $ millions 5, 5,1 5,355 5,12 5,46 5,579 4,5 4,988 4,97 4,917 4,559 4, 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada, the Association of Provincial Funding Agencies and Statistics Canada. Profile 212 7

Screen-based Production in Canada Exhibit 1-3 Total volume of film and television production in Canada, share by segment, 211/12 Canadian television 44% Canadian theatrical 6% Foreign location and service 28% Broadcaster in-house 21% Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada, and the Association of Provincial Funding Agencies. Notes: Some totals may not sum due to rounding. Employment and Gross Domestic Product (GDP) Exhibit 1-4 Number of full-time equivalent jobs (FTEs) generated by total film and television production in Canada 16, Spin-off jobs Direct jobs 14, 12, 14,3 138,9 123,9 13,7 13, 134,8 124,4 12,1 13, 132,5 FTEs 1, 8, 85,1 84,3 75,2 79,3 78,9 81,8 75,5 72,9 78,9 8,4 6, 4, 2, 55,2 54,6 48,7 51,4 51,1 53, 48,9 47,2 51,1 52,1 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada, the Association of Provincial Funding Agencies, Statistics Canada, and Conference Board of Canada. Note: See the Notes on Methodology section for a description of the job-estimation methodology. 8 Profile 212

Screen-based Production in Canada Exhibit 1-5 Summary of the economic impact of film and television production in Canada, 211/12 Canadian production FLS production Broadcaster inhouse production Employment (FTEs) 26,1 14,8 11,2 52,1 Direct Labour income ($ millions) 1,478 787 631 2,896 GDP ($ millions) 1,537 821 656 3,14 Employment (FTEs) 4,3 22,9 17,2 8,4 Spin-off Labour income ($ millions) 1,531 87 654 3,55 GDP ($ millions) 2,282 1,375 974 4,631 Employment (FTEs) 66,4 37,7 28,4 132,5 Total Labour income ($ millions) 3,1 1,657 1,285 5,952 GDP ($ millions) 3,819 2,196 1,63 7,645 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada, the Association of Provincial Funding Agencies, Statistics Canada and Conference Board of Canada. Note: See the Notes on Methodology section for a description of methodology. Total Export Value Export value tracks the value of international financial participation in the film and television production industry in Canada. It includes foreign presales and distribution advances for all projects certified by CAVCO; estimates of presales and distribution advances for non-cavco-certified productions; and the total value of FLS production in Canada. Exhibit 1-6 Export value of film and television production in Canada 25 2,345 Canadian television Canadian theatrical Foreign location and service 2,276 2,35 2,231 $ millions 2 15 359 271 72 12 1,741 251 27 2,32 1,959 225 192 1,713 37 98 252 27 28 28 1,754 267 42 1,848 255 85 367 64 44 116 1 1,914 1,94 1,914 1,462 1,94 1,669 1,433 1,77 1,445 1,58 1,874 1,675 1,874 5 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO and the Association of Provincial Funding Agencies. Notes: Some totals may not sum due to rounding. See Notes on Methodology for a detailed definition of export value. Profile 212 9

Screen-based Production in Canada Provinces and Territories Exhibit 1-7 Total volume of film and television production in Canada, by province and territory ($ millions) 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Ontario 1,915 1,85 1,951 1,951 1,792 1,96 1,93 1,929 2,118 2,568 British Columbia* 1,157 1,55 931 1,379 1,41 1,683 1,338 1,42 1,714 1,58 Quebec 1,381 1,185 1,24 1,13 1,247 1,212 1,346 1,291 1,349 1,355 Alberta 199 115 118 138 179 179 181 152 137 16 Nova Scotia 139 131 117 135 156 93 151 17 88 91 Manitoba 82 111 95 8 124 17 55 72 67 71 Saskatchewan 84 4 71 58 73 82 11 33 44 49 Newfoundland and Labrador 6 8 7 22 7 12 12 4 44 44 New Brunswick 16 16 27 18 19 22 3 19 18 23 Prince Edward Island 1 6 2 5 3 6 2 1 1 4 Total 4,988 4,97 4,559 4,917 5,1 5,355 5,119 5,46 5,579 5,893 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada and the Association of Provincial Funding Agencies. 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 212 due to such differences as data collection periods (fiscal vs. calendar year) and production activity reported on the basis of location of spend. Note: Some totals may not sum due to rounding. * Includes the Territories (Yukon, Nunavut and Northwest Territories). Exhibit 1-8 Share of total volume of film and television production in Canada, by province and territory, 211/12 Prince Edward Island, <1% Ontario, 44% New Brunswick, <1% Newfoundland and Labrador, 1% Saskatchewan, 1% Manitoba, 1% Nova Scotia, 2% Alberta, 2% British Columbia*, 27% Quebec, 23% Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada and the Association of Provincial Funding Agencies. * Includes the Territories (Yukon, Nunavut and Northwest Territories). 1 Profile 212

Screen-based Production in Canada Exhibit 1-9 Total direct and spin-off full-time equivalent jobs (FTEs) generated by film and television production in Canada, by province and territory 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Ontario 45, 42,4 44,8 44,4 39,7 41,8 4, 4,7 43,4 51,3 British Columbia* 31,7 42,5 24,9 36,4 35,6 4,7 31,7 32,7 39,5 36, Quebec 48,1 42,2 42,8 38,1 41, 38, 41,1 37,5 38,8 37,9 Alberta 6,2 3,5 3,5 4, 4,9 4,5 4,2 3,7 3,2 2,3 Nova Scotia 4,1 3,9 3,4 3,6 4,1 2,4 3,8 2,8 2,2 2,2 Manitoba 1,8 2,3 1,9 1,6 2,5 2,2 1,1 1,2 1,2 1,2 Saskatchewan 2,3 1,2 1,9 1,4 1,9 1,9 2,3 8 9 9 Newfoundland and Labrador 1 1 1 4 1 1 1 7 7 7 New Brunswick 4 4 6 4 4 4 6 4 4 4 Prince Edward Island 4 4 4 4 3 3 Total 14,3 138,9 123,9 13,7 13, 134,8 124,4 12,1 13, 132,5 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada, Association of Provincial Funding Agencies and Statistics Canada. Notes: Some totals may not sum due to rounding. See Notes on Methodologyfor a description of the job-estimation methodology. * Includes the Territories (Yukon, Nunavut and Northwest Territories). Exhibit 1-1 Direct full-time equivalent jobs (FTEs) employed in film and television production in Canada, by province and territory 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Ontario 2,2 18,9 2, 19,7 17,8 19, 18, 18,2 19,4 22,7 British Columbia* 12,7 16,9 9,9 14,4 14,2 16,5 12,7 13, 15,7 14,2 Quebec 15,9 13,8 14, 12,4 13,5 12,7 13,6 12,3 12,7 12,3 Alberta 2,2 1,2 1,2 1,4 1,7 1,6 1,5 1,3 1,1 8 Nova Scotia 1,7 1,6 1,4 1,5 1,7 1, 1,6 1,2 9 9 Manitoba 1, 1,3 1,1 9 1,4 1,2 6 7 7 7 Saskatchewan 1, 5 8 6 8 8 1, 3 4 4 Newfoundland and Labrador 1 1 1 2 1 1 1 4 4 4 New Brunswick 2 2 3 2 2 2 3 2 2 2 Prince Edward Island 1 1 1 1 1 1 Total 55,2 54,6 48,7 51,4 51,1 53, 48,9 47,2 51,1 52,1 Source: Estimates based on data collected from CAVCO, CRTC, CBC/Radio-Canada, Association of Provincial Funding Agencies and Statistics Canada. Notes: Some totals may not sum due to rounding. See Notes on Methodology for a description of the job-estimation methodology. * Includes the Territories (Yukon, Nunavut and Northwest Territories). Profile 212 11

Screen-based Production in Canada Convergent Digital Media Production The digital media production sector consists of Canadian and non-canadian individuals and companies that create digital media content and experiences that range across platforms: from mobile devices, to computers, to television screens. Digital media production varies greatly: from applications used in passing, on a person s daily commute, to rich and immersive experiential content supported by multi-million dollar budgets. As audiences expand their use of digital devices (i.e., computers, smartphones, tablet devices) to find, access and enjoy screenbased content, digital media production will become increasingly important to the audiovisual experience. In 211/12, several Canadian-produced digital media products achieved significant international recognition. For example, a graduate student from the University of Montreal won a 211 Indie Game Award in the Best Student Game category for FRACT, a first-person puzzle game set in an abstract world inspired by electronic music. 2 Also, several National Film Board of Canada productions were nominated for Webby Awards in 211, including Highrise/Out My Window, The Test Tube with David Suzuki and GDP: Measuring the Human Side of the Canadian Economic Crisis. 3 Highrise/Out My Window also won an International Digital Emmy Award for best digital nonfiction program. 4 Canada s digital media production industry continued to grow in 211/12, particularly in the area of mobile application development. Toronto-based Polar Mobile was tapped as one of Canada s most promising emerging software companies by PricewaterhouseCoopers. Meanwhile a former employee of Electronic Arts in British Columbia founded the mobile game studio, Genius Factor (creator of the Gravity Well app). One key segment of the digital media production industry is the production of convergent digital media. 5 Convergent digital media production refers to the digital media components of television projects. Such components are typically standalone products that relate to, extend, and/or enhance the associated television property. This type of product, though not dependent on, is often stimulated by the stipulations of the Canada Media Fund (CMF) with respect to the expenditures of broadcasters performance envelopes. As defined by the CMF s Performance Envelope Program Guidelines 212-213, a convergent digital media product must be associated with a standard television project, must be made available for the Canadian public via a digital network (e.g. internet, mobile and wireless services) and must be rich and substantial. Volume Convergent digital media production is, of course, only one relatively small aspect of Canada s wider digital media industry. While no industry-wide survey was conducted in 211, there are signs of vibrant industry activity. For example, the games-development portion of the digital media production industry alone which comprised some 348 companies generated over $1.7 billion in economic activity and employed 15,7 Canadians in 211. 6 Convergent digital media production, as a segment of the wider digital media industry, yielded $34.6 million in production volume in 211/12. 2 Independent Games Festival, 211 Independent Games Festival Announces Student Showcase Winners, press release, downloaded from http://igf.com/211/1/211_independent_games_festiva_12.html on November 18, 212. 3 National Film Board of Canada, NFB nets five Webby Awards nominations, press release, April 13, 211, downloaded from http://onf-nfb.gc.ca/en/ press-room/press-releases-media-kits/?idpres=2249 on November 18, 212. 4 National Film Board of Canada, National Film Board of Canada interactive documentary wins International Digital Emmy, press released, April 4, 211, downloaded from http://onf-nfb.gc.ca/en/press-room/press-releases-media-kits/?idpres=2233 on November 18, 212. 5 Profile 21 presented statistics for Canada s digital media content creation sector. These statistics were based on a survey of digital media companies in Canada that derived more than 5% of their 28 revenues from digital media creator activities. Profile 212, in contrast, presents statistics for convergent digital media production. This is a new data series for measuring digital media production activity in Canada for which only two years of data is available at this time. 6 Entertainment Software Association of Canada, Canada s Entertainment Software Industry In 211, May 211. 12 Profile 212

Screen-based Production in Canada Exhibit 1-11 Convergent digital media production 21/11 211/12 Total volume of production $ 27.6 million $ 34.6 million Number of projects 16 217 Average project budget $ 126, $ 159, Source: Estimates based on data from Bell Fund, CMF and Ontario Media Development Corporation. Employment and GDP Exhibit 1-12 Summary of the economic impact of convergent digital media production, 211/12 Direct Spin-off Total Employment (FTEs) 39 41 8 Labour income ($ millions) 25.9 15.3 41.2 GDP ($ millions) 27.3 31.1 58.4 Source: Estimates based on data from Bell Fund, CMF, Ontario Media Development Corporation, Statistics Canada and Conference Board of Canada. Note: See the Notes on Methodology section for a description of methodology. Household adoption of video platforms There was a sharp rise in the percentage of Canadians using the Internet to watch video (e.g., television programs or video clips) in 211. At the same time, the percentage of Canadians watching television over the Internet or using their cellphones to watch video also increased in 211. Exhibit 1-13 Adoption rates for Internet video, Internet television and cellphone video 7% 6% English-language French-language 68 64 Internet video* Share of total population 18+ 5% 4% 3% 2% 1% % 52 51 49 42 44 38 37 34 3 3 31 33 31 26 26 21 22 16 14 13 12 9 5 8 5 2 1 2 2 4 25 26 27 28 29 21 211 Internet television programming** Cellphone video* Source: Media Technology Monitor 211 (see CRTC, Communications Monitoring Report 212, pp. 111 and 114). * Used in the past month ** Watched a TV program or clip from a TV program available on the Internet Profile 212 13

Screen-based Production in Canada In the English-language market, the usage of the Internet for watching television programming was on par with the use of personal video recorders (PVRs) in Canada in 211. While the share of Canadians watching video on their cellphones was above 8% in 211, the share watching television programming on their cellphones was much lower: 3% in the French-language market and 4% in the English-language market. The use of tablet devices for watching television programming was also still quite low in 211 at under 3%. Despite the fact that Netflix only launched its service in Canada in September 21, by fall 211, 1% of Canadians reported that they already held a subscription to the over-the-top video streaming service for films and television programming. Exhibit 1-14 Percentage of Canadians using new video-distribution platforms, 211 Personal video recorder Watch TV programming on the Internet* 23% 35% 34% 33% Watch video on a cellphone* 8% 12% Watch TV programiming on a cellphone* Watch TV programming on a tablet device* Netflix (National - all languages) 4% 3% 3% 2% 1% English French All languages % 5% 1% 15% 2% 25% 3% 35% 4% Source: Media Technology Monitor 211 (see CRTC, Communications Monitoring Report 212, pp. 112 and 114). * Used in the past month 14 Profile 212

2. Canadian Film and Television Production Canadian film and television production includes all film and television production made by Canadian production companies. Most Canadian production is made by independent production companies, although broadcaster-affiliated production companies7 also account for some production in this sector. Canadian film and television production includes television programs and films with certification from the Canadian Audio-Visual Certification Office (CAVCO) and/or the Canadian Radio-television and Telecommunications Commission (CRTC). This sector excludes broadcaster in-house production: that is, television programming such as news, sports and public affairs programming, produced by Canadian broadcasters. Highlights from 211/12 The volume of Canadian film and television production jumped by 2.3% to an all-time high of $2.96 billion. Children s and youth production rose by 24.9% to a ten-year high of $451 million, after falling by 18.7% in 21/11. Canadian film and television production generated 66,4 FTEs of employment in Canada, including 26,1 FTEs directly in film and television production roles. Documentary production increased by 14.6% to $369 million. Canadian film and television production generated GDP of $3.82 billion for the Canadian economy, including $1.54 billion in production-industry GDP and $2.28 billion in spin-off GDP. The sharp increase in Canadian film and television production was largely driven by increases in the English-language market, where production volume rose by 23.6% to $2.17 billion. French-language production increased by 9.5% to $75 million. The production of lifestyle programming increased by 29.7% to $297 million. Production in the variety and performing arts genre decreased 4.1% to $165 million. Production in the magazine-programming genre rose by 1.6% to $94 million, following a 26.7% drop in 21/11. Canadian animation production also recovered strongly, increasing by 46.5% to $28 million, after dropping by 36.6% in 21/11. Canadian film and television production in the fiction genre increased by 23.4% to $1.56 billion. 7 Affiliated production companies are production companies in which a Canadian broadcaster owns or controls at least 3% of the (voting) equity. CRTC, Guide to the Canadian Program Certification Application Process, CRTC, downloaded at http://www.crtc.gc.ca/canrec/eng/guide1.htm#s9b on November 3, 212.

Canadian Production // total canadian production Higher levels of production volume in both the television and theatrical sub-sectors helped push the overall volume of Canadian film and television production to an all-time high of just under $3 billion in 211/12. While the contribution to this increase was broadly based across different genres and language markets, it was television-fiction production, in particular, that was largely responsible for the overall increase in volume in this sector. In the five years leading up to 211/12, the annual volume of Canadian film and television production had essentially stayed in the range of $2.4 billion to $2.5 billion, as annual increases in one sub-sector were typically offset by decreases in the other (Exhibit 2-1). In 211/12, however, both sub-sectors and both language markets displayed strong synchronized increases in production volume, foreign financing and other private Canadian financing (Exhibit 2-27). All of the key genres, except variety and performing arts, posted higher levels of production volume in 211/12, with most of these increases originating in the television sub-sector. The fiction genre the largest genre of Canadian production broke out after five years in which it, too, had stayed at around $1.2 billion in annual production volume (Exhibit 2-5). The overall volume of fiction production rose by $296 million to an all-time high of $1.56 billion in 211/12. And while fiction production in the theatrical sub-sector was virtually unchanged at $32 million, production in the television sub-sector rose by 3.4% to $1.26 billion. Statistics presented later in this report show that this sharp rise in television-fiction production in 211/12 was due less to higher numbers of television series than to higher average budgets in the English-language market. The production of prime-time Canadian dramas such as Saving Hope, Rookie Blue and Bomb Girls underpinned the higher levels of Canadian television production, which, in turn, helped attract greater numbers of Canadian television viewers to Canadian programming, and offered the potential for increased exports of Canadian programming to other markets. Along with international sales and audience appeal, Canadian fiction television and theatrical production also garnered considerable international critical acclaim in 212. Monsieur Lazhar received an Oscar nomination for Best Foreign Language Film. The Canada-U.S. mini-series, The Kennedys was nominated for ten Primetime Emmy Awards and won four. Meanwhile, the long-running Canadian serial, Degrassi, received an Emmy nomination for Outstanding Children s Program for the second consecutive year. Children s and youth production bounced back from a sharp drop in 21/11, rising by 24.9% to $451 million in 211/12 (Exhibit 2-8). Children s and youth production in 211/12 was higher than it had been in any of the past ten years, surpassing its previous peak in 29/1. In both 29/1 and 211/12, this genre enjoyed a boost from higher-than-normal levels of theatrical production a type of production that was very limited for this genre prior to 26/7. Documentary production also rose after two consecutive years of decline. Its production volume increased by 14.6% to $369 million, largely due to the rise in television production (Exhibit 2-12). Over the past decade, virtually all documentary production was in the television sub-sector. During the past decade, the annual volume of theatrical documentary production never exceeded $24 million and averaged half of that level. Canadian animation production also recovered in 211/12. After dropping by 36.6% in 21/11 to a ten-year low of $142 million, it rebounded to $28 million (Exhibit 2-22). Higher levels of children s and youth animation production in both language markets helped to underpin the sharp rebound. However, over the longer term, the steadily rising levels of overall children s and youth production did not translate into higher levels of animation production activity. The volume of animation production in 211/12 including both television and theatrical production was at virtually the same level ($28 million) it stood at in 22/3 ($27 million). 16 Profile 212

Canadian Production // total canadian production The increased level of Canadian film and television production in 211/12 was fuelled by higher levels of both foreign financing and other private Canadian financing. The former increased by $73 million in 211/12 and accounted for 9% of total financing, while the latter grew by $41 million and accounted for 1% of total financing (Exhibit 2-27). Canadian distributors also increased their investment in Canadian films and television programs, with a view to international sales. In total, these three sources added $265 million in financing to Canadian film and television production, bringing the total value of their combined annual investment to $943 million. Total Canadian Film and Television Production Volume Exhibit 2-1 Volume of total Canadian film and television production 3, 2,956 2,5 2,256 2,429 2,45 2,491 2,437 2,458 2, 2,77 2,24 2,3 $ millions 1,5 1, 5 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Note: Canadian production includes CAVCO-certified film and television production, and an estimate for CRTC-certified television production. Profile 212 17

Canadian Production // total canadian production Employment and GDP Exhibit 2-2 Number of full-time equivalent jobs (FTEs) generated by total Canadian film and television production 8, 6, 58,5 56,6 54,4 Spin-off jobs 63,1 6, 61,7 Direct jobs 6,5 58, 57,2 66,4 FTEs 4, 35,5 34,3 33, 36,4 38,3 37,4 36,7 35,2 34,7 4,3 2, 23, 22,3 21,4 23,6 24,8 24,3 23,8 22,8 22,5 26,1 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data from CAVCO, Statistics Canada and Conference Board of Canada. Note: See the Notes on Methodology section for a description of the job-estimation methodology. Exhibit 2-3 Summary of economic impact of total Canadian film and television production, 211/12 Direct Spin-off Total Employment (FTEs) 26,1 4,3 66,4 Labour income ($ millions) 1,478 1,531 3,1 GDP ($ millions) 1,537 2,282 3,819 Source: Estimates based on data from CAVCO, Statistics Canada and Conference Board of Canada. Note: Some totals may not sum due to rounding. See the Notes on Methodology section for a description of methodology. 18 Profile 212

Canadian Production // total canadian production Language Exhibit 2-4 Volume of total Canadian film and television production, by language 3, Other languages French English 2,956 37 $ millions 2,5 2, 1,5 2,77 77 498 2,24 2,3 19 49 5 527 2,256 53 572 2,429 2,45 2,491 18 29 42 66 634 672 2,437 2,458 28 16 684 685 75 1, 1,53 1,414 1,428 1,631 1,739 1,774 1,81 1,725 1,756 2,17 5 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Note: Some totals may not sum due to rounding. Profile 212 19

Canadian Production // total canadian production Genres Fiction (drama and comedy) Exhibit 2-5 Total volume of fiction production 1,4 Theatrical Television 1,561 $ millions 1,2 1, 8 6 1,142 273 1,51 987 32 163 1,194 356 1,233 1,224 1,172 1,192 282 297 226 31 1,265 299 32 1,26 4 868 749 824 838 952 928 945 882 966 2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Note: Some totals may not sum due to rounding. Exhibit 2-6 Volume of fiction production, by language, 211/12 Other languages 1% $11 million $1.28 billion English-language 82% $274 million French-language 17% Source: Estimates based on data collected from CAVCO. Note: Some totals may not sum due to rounding. 2 Profile 212

Canadian Production // total canadian production Exhibit 2-7 Number and share of fiction projects, by type, 211/12 Mini-series 4% 1 69 Theatrical films 25% TV movies 22% 59 Total number of projects: 272 11 TV series 4% 24 Other TV programming* 9% Source: Estimates based on data collected from CAVCO. * Other TV programming category includes single-episode television programming and television pilots. Children s and Youth Exhibit 2-8 Volume of children s and youth production 5 Theatrical Television 444 451 $ millions 4 3 3 4 28 282 1 37 1 367 6 324 13 369 16 4 361 17 56 2 296 279 282 36 361 311 352 45 344 395 1 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Note: Some totals may not sum due to rounding. Profile 212 21

Canadian Production // total canadian production Exhibit 2-9 Volume of children s and youth production, by language, 211/12 Other languages 4% $17 million $322 million English-language 71% $111 million French-language 25% Source: Estimates based on data collected from CAVCO. Film and television production can be grouped into two categories: live action and animation. A more detailed look at the breakdown of children s and youth production reveals that a large share of the English-language production can be traced back to the fact that most animation production in the genre is originally produced in English. The relatively low volume of animation production originally produced in French can, in part, be attributed to the fact that animation is a highly exportable commodity, and therefore, there is an incentive to make the original version in English for dubbing or subtitling into other languages. Exhibit 2-1 Volume of children s and youth production, by language and category 21/11 211/12 ($ millions) Live Action Animation Total Live Action Animation Total English-language 182 18 291 151 171 322 French-language 63 5 68 94 17 111 Other languages 2 2 16 1 17 Total 245 116 361 267 189 451 Source: Estimates based on data collected from CAVCO. Note: Some totals do not sum due to rounding. 22 Profile 212

Canadian Production // total canadian production Exhibit 2-11 Number and share of children s and youth projects, by type, 211/12 Theatrical films 1% TV movies 5% 13 Other TV programming* 6% 8 6 Total number of projects: 132 15 TV series 8% Source: Estimates based on data collected from CAVCO. * Other TV programming category includes single-episode television programming and television pilots. Note: Some totals may not sum due to rounding. Documentary Exhibit 2-12 Total volume of documentary production 5 Theatrical Television 4 3 31 1 356 24 383 6 36 4 384 1 421 427 12 11 362 21 322 9 369 2 $ millions 2 39 332 377 356 374 48 416 341 313 349 1 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Note: Some totals may not sum due to rounding. Profile 212 23

Canadian Production // total canadian production Exhibit 2-13 Volume of documentary production, by language, 211/12 Exhibit 2-14 Number and share of documentary projects, by type, 211/12 French-language 25% Other languages 1% TV movies 13% 61 15 Theatrical films 3% $5 million $91 million Total number of projects: 455 $273 million 165 214 English-language 74% TV series 36% Other TV programming* 46% Source: Estimates based on data collected from CAVCO. Source: Estimates based on data collected from CAVCO. * Other TV programming category includes single-episode television programming, mini-series and television pilots. Note: Some totals may not sum due to rounding. Lifestyle Exhibit 2-15 Total volume of lifestyle production, by language 4 French-language English-language 3 297 229 81 $ millions 2 61 1 168 217 21/11 211/12 Source: Estimates based on data collected from CAVCO. 24 Profile 212

Canadian Production // total canadian production Exhibit 2-16 Number and share of lifestyle projects, by type, 211/12 TV series 92% Other programming* 8% 97 8 Total number of projects: 15 Source: Estimates based on data collected from CAVCO. * Other TV programming category includes single-episode television programming, television movies, mini-series and television pilots. Variety and Performing arts Exhibit 2-17 Total volume of variety and performing arts production 2 19 157 172 165 15 129 143 126 117 142 133 $ millions 1 5 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Profile 212 25

Canadian Production // total canadian production Exhibit 2-18 Volume of variety and performing arts production, by language, 211/12 French-language 57% $94 million $4 million English-language 41% $68 million Other languages 2% Source: Estimates based on data collected from CAVCO. Exhibit 2-19 Number and share of variety and performing arts projects, by type, 211/12 Other TV programming* 44% 39 Total number 49 of projects: 88 TV series 56% Source: Estimates based on data collected from CAVCO. * Other TV programming category includes single-episode television programming, mini-series and television pilots. 26 Profile 212

Canadian Production // total canadian production Magazine Programming Exhibit 2-2 Total volume of magazine programming production 18 16 156 148 163 154 158 14 134 12 117 116 $ millions 1 8 85 94 6 4 2 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Exhibit 2-21 Volume of magazine programming production, by language 16 158 3 Other languages French-language English-language 14 12 117 116 3 $ millions 1 8 6 119 91 9 85 94 4 76 94 2 35 22 26 1 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Note: Some totals may not sum due to rounding. Profile 212 27

Canadian Production // total canadian production Animation Exhibit 2-22 Total volume of animation production 3 255 25 2 27 2 234 212 22 194 224 28 $ millions 15 142 1 5 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Exhibit 2-23 Volume of animation production, by genre, 211/12 Children s and youth 91% $189 million Total animation production: $28 million $19 million Other genres 9% Source: Estimates based on data collected from CAVCO. 28 Profile 212

Canadian Production // total canadian production Exhibit 2-24 Total number of hours of animation television production 5 452 412 4 364 369 344 377 347 321 Hours of production 3 2 276 283 1 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Source: Estimates based on data collected from CAVCO. Exhibit 2-25 Volume of animation television production, by language ($ millions) 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 Englishlanguage 177 152 215 183 223 192 171 184 124 16 Frenchlanguage 6 17 11 15 23 16 18 25 9 26 Other languages 19 15 6 13 4 12 4 13 2 1 Total 21 184 231 21 249 22 193 222 135 187 Source: Estimates based on data collected from CAVCO. Note: Some totals may not sum due to rounding. Profile 212 29

Canadian Production // total canadian production Provinces and Territories Exhibit 2-26 Volume of Canadian film and television production, by province and territory ($ millions) 22/3 23/4 24/5 25/6 26/7 27/8 28/9 29/1 21/11 211/12 211/12 share of total Ontario 797 875 782 934 824 937 1,5 1,55 1,14 1,422 48% Quebec 762 759 733 821 882 836 861 923 841 928 31% British Columbia 257 22 276 32 44 421 34 22 256 381 13% Nova Scotia 65 57 68 58 75 5 57 53 4 52 2% Manitoba 29 16 28 33 72 38 4 44 41 48 2% Newfoundland and Labrador 1 3 2 15 2 7 6 3 37 37 1% Alberta 82 53 57 38 59 89 92 81 65 35 1% Saskatchewan 67 27 37 38 58 51 73 15 27 31 1% New Brunswick 8 8 19 1 1 16 14 14 1 15 1% Prince Edward Island 9 5 1 3 2 5 3 <1% Territories* 1 3 3 1 1 2 1 2 <1% Total 2,77 2,24 2,3 2,256 2,429 2,45 2,491 2,437 2,458 2,956 1% Source: Estimates based on data collected from CAVCO. Notes: Some totals may not sum due to rounding. 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 212 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. Financing Exhibit 2-27 Financing for Canadian film and television production 27/8 28/9 29/1 21/11 211/12 % $ millions % $ millions % $ millions % $ millions % $ millions Private broadcaster licence fees 19 476 22 541 19 461 21 59 18 536 Public broadcaster licence fees 11 268 9 221 8 21 7 179 8 222 Federal tax credit 11 262 1 241 1 232 1 237 1 296 Provincial tax credit 14 347 14 353 18 446 18 437 19 552 Canadian distributor 8 25 8 197 6 157 9 218 12 369 Foreign 9 225 11 264 9 216 8 24 9 277 Canada Media Fund 1 242 11 275 13 37 11 282 1 33 Canada Feature Film Fund 3 68 3 65 3 67 3 65 2 58 Other public* 3 68 2 61 3 62 3 72 2 45 Other private** 12 291 11 272 12 289 1 256 1 297 Total 1 2 45 1 2 491 1 2 437 1 2 458 1 2 956 Source: Estimates based on data obtained from CAVCO, CMF and Telefilm Canada. Note: Some totals do not sum due to rounding. * Other public includes financing from provincial governments, and other government departments and agencies. ** Other private includes financing from production companies (excluding the tax credit contribution), independent production funds, broadcaster equity, and other Canadian private investors. 3 Profile 212

Canadian Production // total canadian production Audiovisual Treaty Coproduction 8 Audiovisual treaty coproduction is production developed jointly by production companies in two or more treaty nations. It is founded on the principle of reciprocity whereby partnering companies share economic risk, ownership, creative control and benefits from their respective governments pursuant to the terms of a treaty. The Government of Canada currently has coproduction agreements with 53 partner countries. Treaty coproduction is an important avenue through which Canadian and foreign producers are able to combine their creative, technical and financial resources to coproduce films and television programs that benefit from national status in each of the partnering countries. Partnering production companies can take either a majority or minority participation position in a coproduction project, depending, in large part, on the proportion of financing each producer brings to the project. Exhibit 2-28 Audiovisual treaty coproduction with Canada, majority vs. minority Canadian production 7 54 Volume of production (global budget) Number of projects Majority Minority Majority Minority 6 5 45 44 4 36 35 4 4 43 45 43 32 39 $ millions 4 3 2 45 354 191 21 258 189 26 175 176 24 334 27 37 27 191 186 28 251 249 27 292 171 24 26 324 219 1 131 Source: Telefilm Canada. Note: Statistics as of September 212. 22 23 24 25 26 27 28 29 21 211 8 The Canadian share of audiovisual treaty coproduction volume (or the Canadian share of coproduction budgets) is already included in Canadian production volume figures throughout this report. Profile 212 31