APRIL 4, 1974
The National Broadcasting Dream
AN ADDRESS BY Laurent Picard,
PRESIDENT, CANADIAN BROADCASTING CORPORATION
CHAIRMAN The President,
Robert L. Armstrong
Distinguished guests, ladies and gentlemen: Approximately two years ago on the occasion of an address to this Club by the Chairman of the Canadian Radio Television Commission, the introducer, Alan Leal, referred to the rather rough voyage of the hero of Virgil's Aeneid, who was said to have been buffeted about by the violence and unrelenting anger of Juno. Although the terms violence and unrelenting anger are too harsh to provide an appropriate simile in relation to recent events, our hero of today has experienced a rather stormy passage before the CRTC and has come through the ordeal with colours flying.
The renewal by the Commission of the CBC's broadcasting licences has been granted but with certain priorities and restrictions related to an increase in the quantity of Canadian content and improvement in the quality of its programming capability. The CRTC recommends a substantial reduction in the disproportionate influence of merchandising on programme policies.
The public may justifiably ask who pays for the lack of commercial revenue? Presumably, it is the taxpayer and despite the apparent attitude of the tax collector, the well is not bottomless.
Professional athletes participating in televised sports events will have to be in even better physical condition if the pause for commercials is eliminated. At present, the spotlight in Toronto is on football and whereas the action in Canadian football in the old days used to be described as two bucks and a kick, inflation has caused the price to rise astronomically to more than 3,000,000 bucks for a package which still includes only one KIICK. The World Football League Northmen transaction appears to have made its Marc in Ottawa.
Laurent Picard was appointed President of the Canadian Broadcasting Corporation in August 1972, having been Executive Vice-President since April 1968. He obtained his baccalaureate in Arts and Philosophy, and later in Applied Sciences (Physics) from Laval University. In 1964 he received a Doctorate in Business Administration from Harvard.
A Professor in the Faculty of Commerce at Laval from 1955 to 1959, Mr. Picard was Research Associate and Assistant at the Harvard School of Business from 1960 to 1962. From 1962 to 1968 he was Professor and Associate Director at L'Ecole des Hautes Etudes Commerciales, University of Montreal.
Mr. Picard has provided research and consultative services for many industries.
In September 1973 he was appointed Trustee of the International Broadcast Institute, London, England and is also Trustee, British Commonwealth International News Film Agency Trust.
Mr. Picard is a member of the Boards of Directors of the National Theatre School of Canada, Telesat Canada, the University of Montreal, the National Film Board, the National Arts Centre and of the Advisory Council of the School of Public Administration at York University. He is a dedicated individual who has brought a fresh philosophy to the network and it is now with great pleasure that I ask you to welcome Mr. Laurent Picard, President of the Canadian Broadcasting Corporation, who will speak to us on the subject, "The National Broadcasting Dream".
Messieurs les invites de la table d'honneur, messieurs les membres du Empire Club, mesdames, messieurs, c'est avec un grand plaisir et Cest un grand honneur pour moi de pouvoir m'adresser a vous aujourd'hui. Je veux remercier l'introduction tres flatteuse que vous avez fait de ma presentation aujourd'hui et vous parler de ce qu'il reste, that is what remains of the national broadcasting dream after the CRTC hearing. I'm in a very awkward position. I had a conventional speech and with the CRTC decision, the world around me has changed or as we say in strategy at the CBC, the environment has changed substantially.
On the other hand there are a number of processes, defined by the law, which we should follow before we can define exactly what our position is, or what the result of these hearings will be, so that I somewhat feel, not in legal terms but in moral terms in a sub judice position. So I will have to give you half a conventional speech and half a general statement about the CRTC decision which are not going to get into some of the basic problems but can express our fears and our reaction.
I think we've been asked to perform a miracle, and that's great. Though, I'm afraid sometimes of miracles. I'll always remember a story and I hope Father Fournier will not be embarrassed. It's a story of a young missionary going to Africa. His superior told him: "Any time you have a problem, pray to God. " And here he faced a problem, the first day in the jungle. He's right in front of a lion and the lion is looking at him with tenderness, evaluating the size of the thing and ready to eat it. So the young priest fell on his knees and said "God, would you purify the intention of this lion?" At that very moment, a miracle happened. The lion fell on his knees and said "God is great, God is good, let us thank Him for this food."
So I am afraid of miracles. I cannot make many comments before I talk to the highest authority in the Corporation which is the Board of Directors. On the other hand, the newspapers have indicated that we are somewhat upset by some of the statements. We feel sometimes that one of the difficulties between policy making and operation, or one critical thing in a good operation, is that the policy is related to the capacity of the operation and the operation is related to a well-set, well-organized set of policies or what you would call a strategy. If you live in an organization, if you work in an organization where the policy process and the operational process are in the same building, with the same team of managers, still the problem isn't easy to resolve.
I'm not saying that CBC doesn't have the right to define a strategy and policy, but it really creates a problem if too much detailed policy is defined outside the organization. It has a new level of complexity. And looking at the demands of the CRTC . . . when we were in front of the CRTC, we appeared with what we thought we could do in five years and we did that by over- stretching as much as we could all the resources of the Corporation. And I'm going to talk about these resources later on. But we really did take the view that we have no right to be defensive, no right to protect ourselves, that we should go to the limit.
Even though at 75% Canadian content, if one thinks of the problems of the Olympics, of the Commonwealth Games in '78, of the United Nations Environmental Meeting in British Columbia in '76,-four or five weeks before the Olympics,-if one thinks of the incredible impact of the Olympics on the Corporation, I'm sure you understand that an operation of that size has to be ready at a fixed date, contrary to Expo. If you're two weeks late with the Olympics it creates some sort of a problem. You've got to wait till 1996 to use your equipment. So, with this tension in the industry, and there is a great tension in the industry, I'm sure people here who are close to the electronics business know that the delay has been increased substantially, that the lead time has been decreased substantially. With all of these things and the tremendous impact of covering the equivalent of 47 hockey games in one day at the same time-that's what the Olympics is all about-for two weeks, all these problems are not solved easily.
There is, I think, a problem of growth. And contrary to maybe most people in the field, I'm more afraid of too great a growth than too slow a growth.
Looking back at the question of policy, or policy orientation set by another organization, and CBC at the operational end of that, again I claim the right for CBC to define its strategy and its policy. Keeping that in mind I was reminded of the story of the centipede. The centipede was suffering with arthritis and it was a terrible life with the number of legs he had. He couldn't sleep at night, there was always one of the legs, if not all of them, in bad shape and he was complaining all the time. So one of his friends said "There is in the forest, not very far from here, a very wise, old owl." Is that how you say that, owl? Let me use the word "hibou" because I have difficulty using owl. I'm sure any wise, old "hibou" must have some French blood in him. Anyhow, he said, "There is that very wise, old 'hibou' and he's been helping a number of people, why don't you go and talk to him about your problem. " So he went there and explained to the "hibou" how it was impossible to live as a centipede with arthritis. And the "hibou" thought for a while and said: "I've got a solution. You're going to change yourself into a stork. This means that you're going to have only two legs and, more than that, half of the time you can stand on just one of them. " And the centipede was flabbergasted. He said: "Do you know that's the greatest piece of advice I ever had in my life." "Now," he asked, "how do you do that?" And the "hibou" looked at him a bit insulted, and said: "Listen, I deal with policy, not with operations."
I think it's at least a sort of hypothesis to be studied, it's not totally right but I think it could be studied. Most large organizations, and I think I can say the CBC is a large organization, have faced great problems by a too-rapid rate of increase, too rapid a growth, by a contracting market. I don't know how true what I'm saying is or how general. But we all know examples of that, starting with General Dynamics, which has been a well-studied example of growth destroying a corporation, and which had to be rescued by government. We can think of some of the conglomerates in the last five years, of LTD, the problem of the price or what was called the price-fixing in GE, which could very well be interpreted as a problem of growth. I think we can list a number of large firms which have been, if not destroyed, paralysed, and which needed reorganization because of a too great rate of growth. And I have the feeling that with everything we're trying to do, the big danger of the Corporation is to try to do too much and by trying to do too much, not to succeed in doing well what is critical for it to do-its first priority which I think is program quality.
I would just like to mention a number of things which are happening to the CBC now. Because of the demands of the public, and justified demands of the public, we have been working on-and I would like to thank the CRTC for having helped us in that regard-and have had approved an accelerated coverage plan to cover all small communities over 500 which don't receive any service now in their own language. This is a 50-million dollar project. It will take five years to do instead of ten. We have a northern plan which is fully developed but has not been approved in terms of timetable by the government or by Parliament.
We have an incredible problem in obsolescent equipment. Those who have followed the CRTC hearing or read TIME have heard or read the beautiful description of the Toronto plant by Norman Campbell. The Toronto plant needs to be rebuilt. We've got plans for that. We have more than plans, we have a model, we're moving in that direction. We still have some important problems to clarify but the direction is there and we'd like to move and move as soon as possible.
One other thing which has been asked of us is to bring regional programs to the network. To do that you have to have high-quality equipment and the capacity in the region. Vancouver consolidation is going to be completed in a year and a half from now. It will provide Vancouver with a much better basis to produce better programs, though Vancouver has been consistently producing excellent programs for the network. But we are not going to produce in Victoria until we have a station there. We are not going to produce in Moose Jaw/Regina until we have a station there which is something more than the kind of small operation that we have now. All over the country if we want to develop regional programming, develop the quality, we have to think of consolidating our facilities. We also have to deal with the fact that our equipment is obsolescent at a level of 30 million dollars below what it should be. Not only do we have to build new buildings, but the equipment we have now is substantially under standard and much too old. Not only is it obsolete in economical terms but it's obsolete also in physical terms. Those are some of the problems we have.
I read with some kind of misgiving a statement at the CRTC hearing which says "lack of determination, vigour and purpose in addressing the objectives of Parliament". That's a description of CBC. I must say I feel it's a bit like complaining of a lack of purpose if your taxi driver only gets you through Toronto traffic at 35 miles an hour, and you say to him if you were really acting with purpose to get me home you would drive at 100 miles an hour.
I don't believe that the job of the CBC is clearly understood, because of the tremendous spread and size of the country; its extreme complexity; the two networks and the fact that the Corporation has been under-financed in the past; the fact that it's also a very large country with a very small market, a very rich situation; and because the demands on the Corporation go in all directions. Not only are we a broadcasting organization, but also a public service.
And let me make that clear. The only problem is not necessarily the problem of money, it's also the problem of human resources. You don't develop creativity very fast. You need to experiment, you need to test, you need to make mistakes, or at least take the risk of making mistakes. And slowly you develop an environment which is more and more conducive to high quality programs. So the real question is not only a question of money. The whole question is one of defining your objectives very well and getting organized well. Marshall the resources of the organization to attain your objective.
And what are the resources of a broadcasting organization? What are the critical ones? They are the creative people. And this is a very difficult aspect of the problem, to develop inside and outside the corporation, not only creativity, but the structure, the flexibility, that permits creativity to express itself. In an under-financed organization it's even a greater problem. I would like to mention some figures here. I was struck when I went to Japan, two or three years ago, looking at a city which had no high-rise apartments or buildings of any kind, if you leave aside two or three or five maybe, large hotels. Here were about twelve to fourteen million people served by one antenna. The same is true in London. The same is true in Paris. In Canada we need about 400 antennas to serve the same number of people. Those cities are a broadcaster's dream. Twelve, thirteen, maybe fifteen million people if you think of the suburbs, served by one antenna. That's the English population of this country and twice the French population of this country. It indicates the level of problems we have. CBC is one of the most decentralized organizations in broadcasting that I know of, and I have to say that there are a great number that I don't know of, that I haven't studied. I have to say also that data on broadcasting is hard to find, not always reliable, that the comparisons between figures don't always fit together, so that everything I say now cannot give an accurate picture, but it gives some kind of idea of the magnitude of the problem.
Osaka is the second largest city of Japan. I think it has about six million population and it is the centre for something like twenty million. It is the second richest part of Japan, about 350 miles from Tokyo. Osaka, the second largest city in Japan, has a station which produces less local and regional programming than one of the smaller cities of Canada, Corner Brook, with thirty thousand people. The CBC is decentralized to a point which challenges the imagination. Our production is 67% regional, 33% network. BBC is 33% regional, 67% network in a country which is very small. Japan which has a hundred million population or more spends 10% of its production in regions, as opposed to 90% network.
What strikes any person reading that, is that this country is based on regions, and it may be the unique characteristic of the country. I have nothing against that. If Canada is like that, so much the better, let's encourage it, let's develop it. But the fact is that at one point we have to realize the technical, personal and financial implications of a situation like that.
Now let me read you a couple of figures before we end up. We have made an analysis of the number of program hours per person produced in a year in radio and in television. Again I want to warn you about these figures. If you deal with general broadcasting, or if you deal with educational operations, the level of expenditure and cost of production and number of people are strikingly different. NHK, the company in Japan, is both in the ETV structure and in general broadcasting so that the efficiency of NHK tends to be inflated because of that, because half of their work is ETV work which takes a lot less in cost structure and much less in resources.
If we look at the hours per person in radio, CBC production averages 11.3 hours. Sweden, the second best, is 5.3. France, the third, of the ones we looked at, is 5.2. So the second and third best, their hours of production per person is half that of Canada. BBC is 2.5, one fourth the production of the Canadian Broadcasting Corporation. And finally Japan, that we've described so much as the epitome and the paragon of efficiency is 2.1, one fifth of CBC.
On television, hours per person 1.4 in CBC. Second is Sweden with 0.9. Third is Japan with 0.8. Fourth is France with 0.6, and fifth is BBC with 0.2.
Now again let me warn you I am not giving these examples as if you could compare these things. I am not saying that Japan is doing a worse job, because it is so different, because if you do a ballet, if your schedule is crowded with large undertakings and drama, it obviously takes a lot more than something else. So we are not really talking about efficiency, I am not trying to say here are the bad guysand the good guys. What I am trying to say is look at the resources involved in the production of CBC as opposed to the others. These figures tell us something.
Now we should think about these things-a country which is so vast, in a country which has tremendous problems of communication, where there is a great number of small communities, when the north by itself presents a problem, where we all know it has been recognized at the CRTC hearing that we are under-financed, where we have to use 400 transmitters to do the job that one does in Japan. The President of NHK and, for that matter, the DirectorGeneral of the BBC, both say they need more money for coverage, and their budgets are substantially higher than the CBC, even much higher if we look at them in terms of purchasing power rather than the equivalent of the dollar.
A pound is worth $2.50 or $2.30 but a pound of purchasing power in England in terms of work and equipment is worth much more than that because the costs are lower and the salaries are lower. When you look at that I think you have a better picture of what the Corporation is all about.
It's not without admiration that I look at some of my predecessors who have built the CBC. I am told that the CBC was built in five years and the American networks were built in ten years. It's much smaller than some of the American networks but the complexity of the problem is much greater. This is what the CBC is. I think that if you look at the under-financing, if you look at the tremendous pressure on the people, if you look at the royal commissions through the years, if you look at all that you find out that it's very hard to say that the CBC doesn't show purpose, determination, and vigour in implementing the objectives established by Parliament.
I would like to thank you very much for your attention. I feel very much at ease, I hope rightly so, in a business environment. I think some of this data has a meaning for you and this is why I wanted to talk about it. So having said that, I am going to state again that I am not going to talk about the CRTC decision. Thank you very much.
The appreciation of the audience was expressed by H. Allan Leal, Q.C.