Outlook 2008 (9 sectors to watch): Entertainment

The focus continues to be on the fate of the recording industry and, in the online age, its future remains grim.

Viewers will get the action they love in 2008 when Canadian entertainment industries go face-to-face with policy-makers. Major decisions are set to impact television, film and music industries as new media continue to provide big challenges.

The recording industry has lost almost 50% of its value since 1999, according to the Toronto-based Canadian Recording Industry Association. The Music World chain joined the likes of Sam the Record Man and filed for creditor protection this fall, and 2008 will likely be another tough year. “We can’t expect sales to be going up in the short term,” says Graham Henderson, president of the association. Though HMV has expressed interest in buying some Music World stores, closures of others could leave some mid-sized markets in Canada without a record store — further pushing consumers online.

After years of arguing for stricter copyright laws, the industry is holding its breath as federal copyright legislation is rumoured to change soon. Speculation is that Ottawa might adopt legislation similar to the U.S. Digital Millennium Copyright Act, whose controversial rules crack down on file sharing. Music creators, meanwhile, hope their new share of download revenues, approved by the Copyright Board this year, aren’t removed when they undergo judicial review in 2008. The tariffs force online music services such as Apple’s iTunes Music Store and Bell Canada’s Puretracks to pay 3.4% of the price of every download between 1996 to 2006 to composers, songwriters, lyricists and publishers.

In film and TV, Canadian screenwriters will fight a similar battle for compensation for their work when they enter bargaining in 2008. Along with actors, producers and other industry players, writers argue it is unfair for broadcasters to show content across multiple platforms without compensating the creators. “That is bankrupting the entire talent pool in Canada,” says Maureen Parker, executive director of the Toronto-based Writers Guild of Canada. Members of the Writers Guild of America took to the picket lines in early November over similar issues.

Broadcasters face challenges of their own, as advertising dollars increasingly go to the Internet and specialty channels. CRTC hearings in the spring will determine whether conventional broadcasters will win a new slice of revenues by forcing cable companies to pay carriage fees for their signals. Separate CRTC hearings in 2008 will focus on the Canadian Television Fund, and those could affect all players involved in the production of domestic content. “Either the CRTC is going to support Canadian content or it isn’t, and if it isn’t, I think we’re going to have a very different industry come 2009,” says Parker.

The remote is in the hands of the policy-makers now, and everyone is watching.