MR. CHAIRMAN: I want to welcome you and thank you for coming, when the roads are a little greasy. We are delighted that you are here and a particular welcome to David Perlmutter, Andrée Gracie and Michael Ardenne. This is a fascinating topic that we are going to be looking at, music.
On the way in, I was listening to the CBC and they mentioned they are having an upcoming interview with Terry Jacks. All of a sudden, I found myself belting out, in the privacy of my own car, thank goodness, "We had joy, we had fun, we had seasons in the sun", trying the plugged and unplugged versions, according to me. (Laughter)
I reflected on how powerful music is to influence us and what an important part of our life in society it is. I asked myself why music has that power. I didn't really come up with all the answers but one thing I do know is that we have a very vibrant music industry here in Nova Scotia. So we thank you for coming in.
Perhaps we will just go around very quickly. I forget to do this lots of times. Just for a quick introduction of your name and your riding. Then our pattern is that our guests will make their presentation and then we will just have some informal questions. If we could start with you, Don.
[The committee members introduced themselves.]
MR. CHAIRMAN: Welcome, David. We will turn it over to you now.
MR. DAVID PERLMUTTER: Well, thank you. Good morning. We, of course, feel very privileged to be here this morning talking about, certainly, the favourite subject of our organization, the Music Industry Association of Nova Scotia. I think I would like to start by telling you a little bit about ourselves, the Music Industry Association of Nova Scotia.
We are a volunteer organization, primarily. We are a board of directors of 15 volunteers. Three of us are here this morning. We have two staff who are paid staff and do work fairly tirelessly to promote and develop the music industry in Nova Scotia.
Our orientation is very much towards the business side of music. We are not exclusively, but nonetheless, quite shamelessly, commercial in orientation. We want to see more jobs in the music business in Nova Scotia. We want to see people who are already working in the music business earn more money at their jobs and we want to see, well, all kinds of things happen, more music product being sold in Canada and abroad, more licences to use music being sold throughout Canada and abroad. Ultimately, we are hoping that many of our members can quit their day jobs and do what they love full time. That is, work in the business of music.
Our membership at the moment is hovering between 550 and 600 people. We feel that that is a fairly substantial representation of the industry. Our members also include bands, so there would be, actually, more than that number of people. Indeed, we also have other organizations as members. There are many music organizations in the province and we try to maintain relations with them and liaise with them to get ideas on what they want us to do and vice versa.
You may be aware, we have recently helped to complete a survey of the music industry in Nova Scotia that was conducted by Lyle Tilley Davidson. Those materials, I believe, are with you. There are an estimated 2,200 to 25,000 people active in the industry. Again, we are hoping to see those members increase and more profitability develop in the music business.
In terms of what we wanted to speak about today, I know that you have been exposed to a lot of material and maybe we could touch on a few things that, perhaps, have not come up, in the time that we have to begin with. Certainly, the issue of human resource support in the music business would be very topical for this committee. What we have observed is that non-profit organizations like ourselves are able to take advantage of certain human resource support programs; that is, we can hire people and get 50 cent dollars for them and that works, really, very well for us. We can give you some examples of how that is. It works wonderfully for us in the non-profit sector.
What we are going to suggest here today, that the particularities of the music business, given that we are sort of a specialized field, it is a specialized knowledge base, that if those kind of human resource support programs could be translated to the private sector as well, for the for-profit sector in the music business, that would really dovetail well with the nature of the training that is required in our business.
Perhaps I can ask Mike to kind of flesh out this idea a little bit with . . .
MR. MICHAEL ARDENNE: Do you want me to take this now?
MR. PERLMUTTER: Yes, if you would.
MR. ARDENNE: Okay. By the way, I am one of those people who quit his day job and went into the business. I spent 17 years working for the province in the various departments representing culture. I left in 1987 to try to make it on Commercial Street. I now have two companies employing a number of people. One of our big benefactors, I guess you would say, would be artists. Last year, our company, through direct payments or through our clients, paid musicians - primarily, musicians from this province - close to $0.5 million.
It is one of the things that gets lost in the bureaucratic shuffle, if you will, of government programming, when you are looking at what to do with human resource dollars and programs into various sectors. There seems to be a fear in government to provide direct assistance to small businesses, a high risk. We see lots of assistance given to large business, either through discounted loans or tax breaks for creating jobs in call centres or whatever. We see considerable assistance given to the not-for-profit sector by making the summer work programs, student employment programs or apprenticeship programs more accessible to those sectors than we do in small business.
Yet, you hear time and time and time, government saying that the economy of the province is built on the success of small business. Well, I am a small business and we have never been successful in any application to get human resource, 50 cent dollars, to put apprentices into our company. They go into the not-for-profit sector.
Here is a difficulty or here is a challenge that faces. When you put an apprentice in the cultural industry into the not-for-profit sector, you are helping that not-for-profit sector in the short term. That not-for-profit sector, be it Neptune, Symphony, or whatever - and I am not saying those are bad, I am just saying we need to think in broader strokes in order to assist and develop this industry. When you put that 50 cent dollar in there, it helps in the short term for the not-for-profit sector. At the end of that time, the not-for-profit sector, if they want to retain that person that they have trained, it has to come back to the government for 100 per cent dollars, because it is added to their outgo of budget not necessarily added to their increase of revenue. Therefore, in order to retain that person, they need more help.
You take that same person, put them in my business or Andrée's business or another small music business kind of thing and give us the opportunity to train that person and develop them, I guarantee you that that person will develop the skills and the motivation to earn their salary the next year. That's how jobs are created. That's how our training is developed. Because there is no school out there that offers a course in what my company does in an effective way, and that is artist management, artist agency work and event management primarily focusing on music production activities. For instance, just as an example, our company recently planned the 14th Conference of Commonwealth Education Ministers. There was a very significant cultural component to that. The people who were involved in doing that, didn't learn it in school, they learned it on the street and doing what we are doing.
So that, basically, David, very briefly, is the argument. We can take that investment and turn it into long-term jobs. A real quick example. We don't have people, we don't have that trained labour force. Recently a company working with a very successful Nova Scotia artist had to expand, they had to hire more staff. They couldn't hire them on the streets so they had to take them from another company. That company needed to hire staff to replace the staff, so what do they do? They hired our executive director from MIANS, so we have a new executive director starting in a couple of days. That is job creation.
MR. PERLMUTTER: The point really being that the model of training for this industry is on-the-job training. The knowledge base is fairly specialized and there aren't schools in Nova Scotia where you can go to get it and even if there were, I am sure that we could set up community college programs that would assist the music industry - a separate topic - but for the kind of businesses that many of the members of MIANS are in, it is on-the-job training thing. So the kind of training needs that we are looking at do relate to apprenticeship, mentorship programs and also one of the recommendations that was in the Chater report, which was about having a consultation process as well, where people could come to somebody like Andrée or Michael or Brooks Diamond or Andre Bourgeois, people who are very successful in the industry, sit down, take a little bit of their time, an organization like MIANS could administer and orchestrate that, put the people with the needs together with the people who can answer those needs. That is very much an issue here.
There are a lot of different issues that we could talk about. We could talk about a lot of different needs that the industry has. Just by way of example, this industry could be helped enormously if there were a growing number of venues for our artists to perform in. Certainly, one of the things that we had discussed, if there was a concert hall in downtown Halifax that there would be enormous direct and spin-off benefits of that for people who are emerging and developing in this area as well.
MIANS is in the process of putting together a fairly comprehensive, strategic plan for the industry. It is a work in progress. I have put some of the thoughts and some of the discussions in some of the topic areas that we anticipate will be coming forward in that sector strategy in my cover letter to you. I think that, really at this point, we probably would like to throw the floor open and entertain some questions from you.
MR. CHAIRMAN: Thank you very much. We welcome Russell who is filling in for Michel Samson. We will start with you, Don.
MR. DONALD DOWNE: Thanks to MIANS. It is good to see you all. You made it through Christmas all right. You had a few gigs I hope over Christmas and New Years that kept you busy. I am intrigued by Michael's comments there about HR. Just to clarify, HR would provide the same assistance to this industry as they would for a not-for-profit organization for your own company, as the case would be, and that would be for one year or two years or a training program of a specific training nature? I think on our farm, if you have somebody who is unemployed for some period of time and you take him in and train him on the farm in animal husbandry, there was a training benefit. I don't know if that still exists, but years ago it used to
be there. That was not a not-for-profit organization, that was for-profit business. But we trained people specifically in animal husbandry and they went on to find other jobs. Is that the same type of thing you are talking about?
MR. ARDENNE: Well, yes, I think there is a very definite correlation there, but just to perhaps clarify a bit. Last year, there were some government dollars - and I don't know whether they came from the federal or provincial government - and they were given to a not-for-profit organization to administer in terms of awarding apprenticeships or assistance or training programs. You had to develop a very extensive training module for an individual. But in my mind, at least, and I think in my colleagues' here, because that money was provided to a not-for-profit organization to administer, their predilection was to go to the not-for-profit sector; I don't know of any for-profit organization in the province that received benefit of those funds. I am pulling numbers out of the air but I am pretty sure it was something in the vicinity of a $10,000 thing that you had to match or double, so the program put in $10,000, you had to put in $10,000 or $20,000 in a combination of cash and kind, in terms of salary to support the person for a year. But, yes, a very specified training program. That's one aspect.
The other aspect is the consultative mechanism that David was talking about and that was presented in the Chater report that said that a person developing their skills in the industry could apply and get some assistance for the kinds of consultation, either short or medium term, with experienced professionals in the field so that that professional was not always giving their time. We get endless calls from people, well, what do I do about this and how do I do that? Unlike lawyers, the culture of our industry is that (Interruption) Right, or farmers . . .
MR. DOWNE: We should be so lucky.
MR. ARDENNE: You should be so lucky. There isn't a culture in our industry that when you walk through the door the clock starts ticking and the bill starts going out, because they don't have the funds to pay it anyway at that level. So there is both a short-term and a long-term kind of double-pronged approach to training. As David said, and Andrée can certainly attest to, you don't get it in the schools. It is something that you have to learn on the job.
MS. ANDRÉE GRACIE: I would like to attest to that, Don, speaking from experience on two sides. I, too, was in the public sector for 10 years, I worked in market development for the government tourism and convention centre and I now am working in the music industry full time and so is my husband. My husband is John Gracie, the performer. When I entered the music industry, a lot of my marketing background came with me, but I was on a learning curve, obviously. I had wanted a mentor, I was working a 24 hour day anyway and I was hoping to take a portion of my time to mentor with a Brookes Diamond or Michael Ardenne, so that my learning curve wouldn't have been so long. I feel that I lost time with John's career by being on that learning curve. Certainly, I took my marketing skills and transferred them to this industry but lost in areas where I needed to learn on the job, which I had no resources, because like they said, it is not in a book. So on that end, I could have been further along today if I had had that program in place when I entered the music industry.
Now, we are surpassing projections and we are employing two full-time people and many, many freelance musicians. I am very proud of the economic impact that a small company as Gracie Entertainment has impacted this community in the last few years.
I can see, now, for growth of our company, that if I had someone to come in and mentor under me, that that would also enable me to move forward and be able to do more and grow the company more, as well as train that person. So this small business would also - because I need assistance and I cannot at this point, I am at that critical point, as we all know, anybody in small business - where I can't overtly hire somebody by myself. With a program like Michael is talking about on the 50 cent dollar, $10,000 investment, I certainly could and that would take my company to the next level. So then you will see a more successful company in Gracie Entertainment. Those are two examples, from me, personally, that I can see benefiting by Human Resources coming into the small business.
MR. PERLMUTTER: The idea would be that if a program could distribute $10,000, Andrée could probably swing $10,000 and then, having that person in the business that year, they would earn another $10,000. So you would be able to pay them and then the following year they could be absorbed completely and they would be trained and ready to go.
MR. ARDENNE: On their own or out the door.
MR. PERLMUTTER: Yes. (Laughter) It is the kind of thing, also, that is not terribly - it seems to me - difficult to administer. It is a heck of a lot cheaper than bricks and mortar. It is the kind of program that could be administered by an industry association such as MIANS, which has an absolutely incredible record of the board leaving their briefcases at the door. It is unbelievable, the kind of work that that board does. I am not currently on the board but I certainly continue to admire and respect the way in which the organization handles its business.
MR. DOWNE: Am I entitled to another question?
MR. CHAIRMAN: Yes.
MR. DOWNE: I would like to explore that and maybe some time we could because if it is an HR, it is a federal initiative and maybe there are some things we could be doing there with the federal government to take a look at modifying some of the programs, if nothing else, to try it. A mentoring program, as you know, that is a great concept of allowing people to go forward. Anyway, we can talk about that at another time.
The other question, the other comment I have is, the strategy. We have talked about the strategy before now, for about a year now we have been talking about developing a long-term strategy so that Nova Scotia is the music capital of the world, right here; that strategy being important but it would be one that would be a tripartite issue, strategy. Maybe you could flush out some of the points that you think are important like, where the role of provincial, maybe municipal or federal governments - governments being broader, and industry, partnering
together for that strategy. Do you have any comments on that, that we could be looking at as a committee, I guess, is really the essence of that?
MR. PERLMUTTER: Certainly, MIANS is looking to help move the industry forward with the help of government, federal and provincial. We understand that the federal government has a number of programs in place through the Department of Heritage. We administer their foundation to assist Canadian talent on records, the FACTOR programs in this province. That is a foundation that provides funds up to a certain level to assist in touring, recording and marketing. It is a wide variety of programs they have. I believe that there has been about $10 million, federally, in that program.
MR. ARDENNE: For national.
MR. PERLMUTTER: For national. Now, the budget for that is increasing dramatically, or has been promised - we'll see if it really happens. In the red book - and many people in the industry are quite optimistic that we are going to get the benefit of this - they are going to increase it another $10 million, then another $24 million in the following year, then $32 million up to an extra $40 million, so there will be, like, considerable investment in recording on the federal side. Of course, our organization will be working hard to make sure that the benefit of those programs get into this province.
[9:30 a.m.]
What the federal government exactly has in mind is a bit of a mystery to us and it may be that they are going to be looking to organizations like CIRPA, the Canadian Independent Record Production Association and, perhaps an organization that we are a founding member of, the Canadian Council of Music Industry Associations, where we have banded together with industry associations like ourselves from provinces right across the country. Hopefully, we will have input into how those federal dollars are administered.
Separately, I think, there should be HR programs that we just spoke of earlier. We would hope to have that kind of support on the federal side. Provincially, we think it is - well, first of all, I think it is essential that there be a strong industry association to act as an interface between the government and the industry and to be able to communicate the needs back and, again, have an input into policy.
We are looking for a continued - we have enjoyed considerable support from the province for the past number of years. We are hoping that that support will continue because it does continue to be necessary. When you look at the models for industry associations across the country, they are, indeed, all fairly dependent on some degree of provincial support. The alternatives for running a music industry association, such as going to the private sector, relying on dollars from our own membership, is not really practical. We do not get corporate sponsorship because we don't create traffic in Sobeys and we don't create traffic in Kent stores. It is really like that.
At this time, our organization is somewhat vulnerable. We are always having to be lobbying, to be spending a lot of time thinking about fund-raising and so forth. That will continue to happen but at the end of the day, in order to ensure that there is a strong industry association, we will be looking to the province for continued support. If we get that, then we will be able to move forward and help develop some initiatives.
There has been a great deal of talk about a tax credit, as you know. Certainly, that is an initiative that we are in favour of. There is a model in Ontario that appears to be working, although it is quite new. We haven't got a huge amount of feedback, in terms of how well that is working, what their numbers are and what the results are but we anticipate that that information will be coming forward. It just seems fairly logical, given the way that tax incentives have assisted investment and activity in another cultural sector and, in particular, film, that it makes sense that this is a kind of investment that is appropriate for the province to be considering at this time.
MR. RUSSELL MACKINNON: Can I . . .
MR. CHAIRMAN: I will come back to you, Russell. Darrell, you wanted to jump in on this same topic?
MR. DARRELL DEXTER: No.
MR. CHAIRMAN: Oh, okay. We will go to Russell.
MR. MACKINNON: Thank you, Mr. Chairman. Folks, I am looking at Page 1 of your study here and your cover letter, dated January 9, 2001. You indicate that the music industry generates approximately $12 million in revenue for the government. I am assuming that is both federal and provincial, is it, or is that provincial?
MR. PERLMUTTER: No, that is federal and provincial.
MR. MACKINNON: So, let's say it would be safe using a figure of - approximately 40 per cent of that would be provincial, give or take?
MR. PERLMUTTER: Yes, I would agree.
MR. MACKINNON: So for about $5 million, $4.8 million, were you able to quantify how much the provincial government has invested into the music industry to support your efforts? If you don't have that on hand, maybe you can take it on notice. I think it would be an interesting perspective to help further your argument, is essentially what I am suggesting.
MR. PERLMUTTER: Certainly the province has made a direct investment in our industry association, and that was about . . .
MR. ARDENNE: It was between $70,000 and $90,000 this year.
MR. PERLMUTTER: Yes, between $70,000 and $90,000, but that was also with some federal assistance as well.
MR. ARDENNE: Yes, that's right, that was a joint federal-provincial package and then the rest of it would basically be whatever funds the government puts into its own departments for their budgets that go to music. But that would be about it provincially.
MR. PERLMUTTER: There are no provincial programs that they have, for example, in other provinces, such as the sound initiative that the Chater report was arguing for wherein there is actual direct funding into the industry to run specific programs. I think there is an investment in the East Coast Music Association, but other than that I would say that there really isn't anything, there isn't a great direct investment at all.
MR. MACKINNON: That's the point I'm making, because I feel (Interruption) Well, exactly. So you are getting about $5 million and they are only investing about 2 per cent to 4 per cent maximum when you include the additional investment for the annual awards and so on.
In my own constituency I have an experience that we went through several years ago when we invested in Rita's Tea Room in Big Pond; that was federal, provincial and Rita herself - a cooperative effort. We received a fair bit of criticism at the time for investing in that but, you know, the provincial government received all of its revenue back in less than a four year period
and they are making considerable dollars off that one investment. I cannot speak for the federal government, but I would suspect that they have received that back. The payback period was just phenomenally low, it was half of what was estimated. The number of tourists that go through that community of Big Pond, well, Andrée, you know yourself, and now with Gordie Sampson from Big Pond and he has done quite well - we have been quite blessed with having talent from Big Pond - John Curtis Sampson is also from my constituency . . .
MS. GRACIE: There must be something in the water there. (Laughter)
MR. MACKINNON: I am making a PR pitch for all the wonderful talent in Cape Breton West.
In any event, the point I am making is that if we look at Great Britain's experience after the downturn of the coal industry, one thing about the music industry, as put forth by our presenters today is, number one, it is an excellent investment for the taxpayers; number two, it is environmentally friendly. All the concerns that we have about the environment with coal and steel, that's one of the things that we have been blessed with in Cape Breton, from one end of the Island to the other, with the Barra MacNeils, Natalie MacMaster, the Rankins, John Curtis Sampson - and you can go on - and so on.
I am speaking in those terms because I think it is something that politicians, in many cases they appreciate and like the music: some like Scot, some like Irish, some like punk rock, or whatever, but we really don't understand the business behind the scenes and I think it's important that you folks continue on in that vein.
I think you made an excellent presentation. I want to compliment you, Andrée, you and your husband, well, there hasn't been a mall in Nova Scotia that you haven't promoted your husband. I have never seen a promoter - if we had more people like we have here before us, Mr. Chairman, one of the reasons Nova Scotia is doing so well on the national stage is because of the promotion. Even travelling down through the United States, it is amazing how much Nova Scotia music is presented, although we are fighting somewhat of a political fight there and I don't mean at the partisan political level, but politics within the music industry, because they like to promote their own and it is very difficult. But when we have talent such as that promoted, and we do need a greater investment provincially - and I guess we can take some responsibility for not being as supportive as we could have been - but you take it as it comes and it is as strong as the industry makes its arguments, so I would encourage you to do the same. So, that was my sales pitch for the day, Mr. Chairman.
MR. CHAIRMAN: Thank you for making it. Darrell.
MR. DEXTER: Mr. Chairman, this is meant to be very wide-ranging and I intend to pursue that a little bit, mainly because I think there is probably no more romanticized industry on the planet than the music industry and people have a view of musicians kind of as lonely troubadours who go about their business around the province or across the country or, indeed,
around the world as independent spirits out there for the love of their art. That may all well be true, but I think the industry also has levels and tiers in it which people do not appreciate.
Certainly from my practice before this, I had associations with many artists and found that, indeed, they carry out this work in an atmosphere where there is very modest pay, no benefits, certainly no pensions. There isn't insurance in the way that we would see it and that brings together a picture of an industry which although can be extremely rewarding, can also be very difficult for many people out there struggling to make a living doing what they love.
I guess there are a couple things about it that struck me, and one issue that was raised that I found very interesting for entertainers who are working in the bar circuit, for example, one fellow raised an issue with me and said, look, back before VLTs, we were the draw on Saturday night. When we went into a lounge, the people came to see us and the bar owners knew that if they wanted to have a crowd on Saturday night, they are going to hire a band, they are going to hire an entertainer. But now, they cover their overhead through VLTs, they don't need us anymore; in fact, unless they have a particular commitment to promoting a particular kind of reputation for the bar, they don't do it or they pay less or it has had a lot of negative spin-offs. I guess all of this is about the way the industry is changing.
In the very last paragraph of your letter, David, you talk about technology and the delivery of recordings via the Internet. You said that may be coming in the years, that maybe this delivery will take place, but isn't it taking place now with Napster and MP3? Isn't that delivering music to people and isn't it profoundly affecting the way that the music industry is going to move in the next number of years?
MS. GRACIE: I also think it is an important issue that both you and Russell have made, and I feel very close to this. You talk about it being a passion. I probably have the toughest job in the world because I represent my husband and it is very difficult for me to get respect in that fashion, as a businessperson, because I am his wife. I am dealing with somebody who has a passion to succeed, and I also have to put braces on my child without any health care and live a standard of life that I was used to when working for the government. (Laughter)
So, I see that we have two things happening here. I want to have a successful business and today it has changed. We need to educate the layperson on how you can succeed. There are only a very few multinationals today. There are probably only a handful of Céline Dions and Bryan Adamses and whatever, but there is a very successful next tier. I have been amazed on the ways that you can promote music today. You were talking about new technology but we have had very phenomenal success with television marketing and 1-800 lines and I don't want to remember but Russell brings up being in shopping malls, but certainly those ways have enabled me to bring the business further. Yesterday, on an e-mail system I was looking at Iceland, I have e-mail from the New York Consulate that wants John at the Lincoln Center in New York so technology is opening the world.
It is not necessarily a bad thing that people are downloading information on the Internet because we are now making ourselves available to the world through those means. We all adjust
to those changes in technology. As Michael mentioned yesterday, I am sure we all have taped records on cassettes years ago, so it is probably just a more modern version of those things. But we can be very successful and we need to educate people on ways that people can be successful in the music industry except for trying to get that major label record deal, because they don't exist anymore. There is touring and marketing and all types of ways of getting your product, not just through listening to the radio anymore but by getting your music out in different ways, and getting out to the world and bringing your live performances. There are a number of ways, except for the sort of traditional ways of being successful in this business. I think that is what we need to tell people, because there are a number of us who are doing it and doing very well at it.
MR. PERLMUTTER: One of the things that perhaps it would be appropriate for us to communicate is something of - I wouldn't say bias but at least - a perspective that our organization has concerning the importance of having a Canadian-owned, independent recording industry. The dependence on the major labels is not the recommended way to go, at least in North America, if you are a North American. Certainly, the labels are and continue to have value in distribution in other countries but here we like to encourage our artists to maintain ownership of their own material, their own copyright as much as absolutely possible and to learn how to use distribution agreements and working with independent Canadian-owned, maybe, smaller labels in order to get their work out.
Now, what Andrée has been fantastic about in her experience is finding these alternative methods of distribution even before the Internet. Now that the Internet is here and we are able to develop that, that continues to be exciting for those artists who wish to remain independent as well. There are organizations that have bubbled up, one is called IndiePool, these are Internet distributors that are independent and offer a new way of doing business. It is all in transformation but we welcome it and we think it is a very exciting and certainly the music industry is not threatened by Napster. I just don't think that that is really something that is truly intimidating most artists on the ground, most people, most businesses who are trying to get off the ground in the music world. We see it as something that holds a lot of promise.
MR. DEXTER: Mr. Chairman, if I can, I would like to pursue that just a little bit, because that quite amazes me. When you want to start promotion, and I understand somebody like Nelly Furtado, who I think actually started out on the Internet, once you reach a certain level of success then all of a sudden if I want your music, I don't have to pay you, all I have to do is go on-line and download and the relationship between the artist and the consumer is gone.
MR. ARDENNE: That has been happening for years, every time that you played an album and decided to take a cassette recording of it so that you could play it in your car, van or boat any time you wanted to, you were doing exactly the same thing, just at a different level of technology. It is one of the reasons why there are surcharges on blank tapes and things of that nature, so that the artist can get some kind of recompense. It is one of the reasons why IBM and Sony and a Japanese company that I can't remember the name of now are trying to develop technology that will prevent MP3 recorders and things of that nature from pirating - basically stealing is the real word, pirating is the polite word I guess - from not only the creators of the
products but the producers and the distributors of the product. It affects everybody along the food chain.
In the big picture, however, the major companies with the huge investment dollars, the mega-mega-million investment dollars are looking after how to take care of that. Our concern really at the entry level and at the level that Andrée is talking about, is getting out there. If somebody likes our music well enough to steal it, right now, that means that they are going to talk about it to somebody else and maybe that other person is going to go out and buy it. So in the smaller picture, we can deal with that. The bigger picture, the technology giants are going to help and we are going to be the parasites on their research and things of that nature.
MS. GRACIE: Touring is where the money is. Even major artists will say that that is where the majority of the money comes back to them, is in touring. That's where the major money comes to my company.
MR. ARDENNE: And selling off the stage.
MS. GRACIE: And selling off the stage.
MR. CHAIRMAN: Maureen.
MS. MAUREEN MACDONALD: I know absolutely nothing about your industry as an industry. So I really welcome this opportunity, it is great. I know what I like though. I live in the North End of Halifax, Scott Macmillan is my neighbour. My question is really about distribution. If you can help me understand a very specific problem that I myself had. Linda Carvery just issued a wonderful CD, couldn't find it anywhere at Christmastime. Salsa Picante has a wonderful CD. I hear this music, it is widely played, certainly on CBC, so the message is getting out that this music is there but when you go to try to purchase the CDs, you can't find them anywhere. Why is that?
MR. ARDENNE: That's not an easy question to answer. The concept is simple but the answer is very difficult. If we knew the answer to it, we probably wouldn't be sitting here. Very simply, there are three basic levels of relationships between the artist and the recording company distributor. One is a record company, that is the record deal you hear about so much, that is where the record company says, we think you have potential, we think we are going to make money off you, we are going to front the money for your record, we are going to get you a producer, studio time and pay all the costs, et cetera and you will probably get a buck a unit when it is all over. We are going to take all the rest to recoup but we put up all the investment, the marketing, distribution, production everything. That's the record deal.
Then there is the licensing deal. The licensing deal is where the artist and the artist management team, whatever, produces everything right up to the master and the artwork for the sleeve. The record company then says, geez, that's a great product, we think we can make some money on that. Now, we didn't invest in this but here's what we are going to do, we are going
to manufacture it, we are going to market it and we are going to distribute it. You will probably get two bucks a unit.
Then there is the third level, which is the distribution deal. That is where the artist does everything including manufacture, goes to a company and they say, okay, we will distribute it through the network of retail outlets with whom we have established commercial relationships. But they fill orders, they don't market. Therein lies the biggest problem of the independent, the marketing dollars. For instance, Scott Macmillian and Linda Carvery, they have the product, but the distributor can't place the product unless the retail outlet says they want it and then they will probably only buy - Andrée, correct me if I am wrong - two to three to five units on consignment, so the artist is still taking all the risk on that. So you don't manufacture any more than you think you can sell off the stage and do it in dribs and drabs; low manufacturing volumes mean higher prices or higher costs to the artist.
So you are not going to get the Linda Carvery stuff into the stores until somebody has the investment dollars to put into advertising. Now at Zellers, now here, now there. I don't know if you bought advertising lately, but you can chew up - you are better off, quite frankly, not to advertise and to sell your product off the stage when you perform because when you sell that CD for $20, you are probably going to reap $15. If you go through a distributor, the distributor will pay you anywhere from $7.00 to $9.00 to maybe $13 at a maximum, but you still have to do all of the upfront stuff.
I hope I haven't confused you with too much information but that's the challenge.
MS. MAUREEN MACDONALD: No, you didn't, it was very helpful.
MS. GRACIE: Just quickly out of that, because I have to, I think it is so important you know these stories. Just quickly on two items on that. A success story was when John released the Gene MacLellan tribute, we kept it from retail and did television marketing and created a demand. Then retail wanted it. So that was a case of keeping it until we created the demand and then everybody wanted it; EMI wanted it, Atlantica.
Now, the other problem, just on that and maybe where HR would help us, is for instance I had a product again in demand; John has a Christmas album out. So we did a television marketing campaign pre-Christmas. It was very successful but I went into stores and found that it had been sold out but it is only one of many products that you see and the guy in the stores doesn't really care about it so they don't watch what sells out. If I had what the big record labels have, which is what they call a rack jobber, to go monitor stores and tell the retail outlet when you are sold out - you almost have to do that - then I would be able to fulfil more orders and sell more product. Now, the big department stores, I have gone out one time to Wal-Mart and all their Christmas stuff was in the storage area and my records hadn't been brought to the record department.
So, again, if I had that other person at Christmas, my biggest retail time besides the summer, going to retail, which record companies do, not a big amount, I would do it on a
commission basis maybe or an hourly basis like merchandisers do today and other major companies, I could make sure the product was in the stores. So, again, it is managing your company so that you see all the problems and not everybody - that again is where we are lacking artist management - not every artist, they make the record, they get it to the distributor, they get a deal, but they don't have the company people surrounding them that they need to bring them to the next level.
MR. PERLMUTTER: Linda Carvery is a good example of somebody who has been looking for management and if there were more really good managers available, they are the people who take that kind of work that the artist is doing and take a box of CDs that are in somebody's room somewhere and get it on the website, so that when you can't find her record in stores, you can go to your computer, type in Linda Carvery and you get a hit on that website and there you go. You can phone this number and obtain it.
MR. ARDENNE: Poor Linda, we could do a case study on her and she is not even here. But a manager isn't going to take on that responsibility. A manager isn't going to take it on, this is one of the really key things here. People will say, oh, a manager will do that, a manager will do this. The number of artists out there who are looking for management is phenomenal. The number of managers who are running for cover is minimal because there are very few managers out there and we don't want those people knocking on our doors because we can't help them because of the work-up time to the time that they start making a return. We don't have the capital, the cash flow or the staff resources.
[10:00 a.m.]
Now, if there was a human resources apprenticeship program, internship program where you could put an emerging artist - and I won't mention any names - with an emerging professional under the mentorship of an experienced person like Andrée or Brookes or Andre Bourgeois or Joella Foulds or Max MacDonald, then we have the right mix there for creating an ongoing, self-sustaining industry that develops jobs, because every successful artist brings in new jobs; road managers, publicists, not all individually committed, but you get more companies developing because there is more demand for their services because there are more artists that are starting to make more success, and also in the export market. John Campbelljohn is a good example. The largest percentage of his activity takes place in western Europe. That brings in foreign dollars to here. That is a solid investment.
If I could, Mr. Chairman, I would like to go back to one thing that Mr. Downe indicated. He said that HR was a federal thing and maybe we could talk about a few things. But HR is also a provincial thing, because the province puts in money for short-term work programs and student programs and things of that nature. The province used to invest in work terms at university programs but every once and a while, or not every once and a while but quite consistently, you will see that the priority is government departments, municipalities and community organizations, none of which are in the business of creating sustaining jobs. Government is cutting back. Municipalities are looking for people to do short-term work that they can come in, rake the leaves, cut the bushes, kind of thing, that job is done and they can go back out.
You take that same dollar and invest it into small business industries like Andrée's and mine, and as I said before, it doesn't matter where the dollar comes from, as long as it takes some of the risk off the small-business person with a staff of two or three or four people. The amount of time that we have to invest in training, the facilities, the computers, telephones and everything else that we have to have there, it is a tremendous bargain if that money comes in to us and we can create a full-time job out of it. After a one year training period, that goes to a full-time job, and there are dozens of businesses like ours, dozens of businesses that could create dozens of jobs and spin-offs. Sorry, I just wanted to pick up on that point. I didn't want to let you off the hook. (Laughter)
MR. CHAIRMAN: I have lots of questions and I am thinking about why my book wasn't marketed by this B.C. company properly. You have given me some hints. Anyway, of course, I guess a person never feels that it is marketed properly, there are always more sales out there. We will move to Tim, though I will come back at the end.
MR. TIMOTHY OLIVE: Again, I was very pleased to hear the presentation. I want to touch on a couple of points that David made. One of the points you made was that the federal government had a proposal in the red book that we would see over the next few years up to $40 million being added to this sector across the country. I think that is a very laudable situation but from the point of view of a reality check, it is very easy for the federal government to come up with $42 million to put back into an economy that in Nova Scotia alone, in the last four or five
years, they took out over $1 billion in transfer payments. So if you don't spend money, it is pretty hard to find it and then turn it back into the economy. So, I think you have to put that into perspective when you look at what the provincial government is doing.
This year, I think our contribution is about $40,000 into MIANS for administration. I don't question for a minute that that is not enough money. It is ridiculous to think that it is. But given the previous statement regarding the amount of funds that have been cut, it is an issue that we have to deal with: the federal government dealt with it in their own way and the municipalities have dealt with it, other provinces have dealt with it and I think we are in a transition period regarding tourism and culture. As I said to another group here, one of the first things our government did, we peeled Tourism and Culture out of Education and gave it its proper place, as far as we are concerned, as a priority in Nova Scotia, with its own minister. I think it has been completed now, a complete evaluation and restructuring of the cultural sector within the Tourism and Culture Department which, I think, will be much more responsive over the next few years, notwithstanding the changes to the funding, the ability to fund organizations.
I think we are on the right track. Sure, we would love to cut cheques a lot bigger but I really believe that that process is going to happen over the next few years to those organizations that do add, we are talking $100 million into the economy; $12 million in taxes, $4.8 million for Nova Scotia. You cannot argue the numbers. The numbers are there. MIANS and the partners in MIANS, certainly, are providing that economic benefit, as well as the cultural benefit. I think we have to appreciate that.
In your letter, there was a comment there about investment, ". . . includes private investment, investment by financial institutions, government initiatives . . . that provide assistance, grants, subsidies, or tax credits." As I stated about the financial position today, of the government, I am just wondering, what other areas do you see through the ever-expanding participation under MIANS? Are you restricted to what you talk about, private investment, investment of financial institutions? Are there other areas where you see potential financial growth within MIANS?
MR. PERLMUTTER: Do you mean money for MIANS or money for the industry?
MR. OLIVE: Well, money for the industry. You do mention private investment. I think you also mentioned that Kent is not a place where you can go and tap them for money because there is no return investment.
MR. PERLMUTTER: Yes. What I was talking about is, there are two things. One is, financing the running of a music industry association. Then I think in my cover letter I was talking about investment in the music industry, broadly. By private investment, I want to make a record, I go to my Mom and Dad, I go to my cousins, I go to everybody that I know, I beg, borrow and steal and then I go to the bank and I get turfed out. Then I go to the Foundation to Assist Canadian Talent on Records. You know, maybe they give me something to match what I got from my family, so on and so forth.
In some other provinces, there is also direct funding available from their province. Their province has other programs that, perhaps, mirror what the Foundation to Assist Canadian Talent on Records does, funding to support touring and record development, video and so forth.
Then, I suppose, the other thing that we had considered, if I wanted to have my music project go a little further, perhaps I could approach a few business associates that I might know who I could, hopefully, convince to make some investment in it. Maybe one of the selling tools I could use would be the tax credit. Or, perhaps, there could be something like, well, forgivable loans seems to be the model that the Foundation to Assist Canadian Talent on Records uses. That has been a successful model that other provinces have adopted as well.
MR. ARDENNE: Just to explain, that loan that David is talking about, in some of the programs through FACTOR they don't provide grants per se. They do provide loans and you pay that loan back, so much per unit sold over a five year period. If, after a five year period - unless the rules have changed but the last time I did it, it was a five year period - you have not managed to pay it all back, then the balance is forgiven because the lifespan of a recording is not likely to exceed five years, unless it is White Christmas or something like that.
MS. GRACIE: We just came back from a very important showcase performance, two American talent buyers, which is critical because that is the ultimate market for us, the American market place. I did get a grant and a loan from export development, federally, and there is one pending approval, a cultural grant, through the federal government.
Now, unfortunately, where I used to be able to get export development, export marketing funding from Cultural Affairs, those programs no longer exist. That was wonderful because that was an area that I could - you know, international marketing is so important to us because, obviously, that is the growth for our company. Unfortunately, those dollars aren't there any longer and whether they be $2,000 or whatever, they help us with travel expenses and so on. It is difficult.
MR. OLIVE: Just to carry on, there are two issues. There is the administrative issue, the funding to actually establish the organization to do the work, which you say you have two full-time employees. What would be your ideal situation regarding funding in dollars and cents, and/or staffing, to be able to at least have that foundation? The province's contribution is $40,000, but there must be some coming from somewhere else.
MR. PERLMUTTER: Yes, $100,000 is the number. I think that last year our budget was $140,000. We had $40,000 from other sources. We had $100,000 from federal and provincial sources, or $90,000 from federal and provincial sources. That is really all that is required, just to have that continue, to have two people modestly employed in a little office . . .
MR. ARDENNE: Working their butts off.
MR. PERLMUTTER: . . . working like crazy. You know, the phone is just going all the time, people are in and out and we are always sending out messages over the e-mail network. I know there are a number of people who have commented that they get so many from us. They certainly know what is going on in town.
MR. ARDENNE: I think one of the significant things here is that, in my day in the department when I was head of performing arts, there was a music office in the department. Through the natural evolution of departments and changing priorities within government, the restructuring of that department, such that are no longer disciplined, specialty officers available to the clientele, the role that my staff used to fulfil, now falls on organizations such as MIANS. That is one of the reasons why that phone, the fax and the e-mail just absolutely never stop ringing.
It would be interesting, if you spent $25 and became a member of MIANS, you would probably get five or six e-mails daily from members of the organization that are promoting their particular performances, showcase operations, or whatever. It is an absolutely phenomenal service that this organization provides. One of the reasons why it is so important, is that that organization is now doing part of the function that governments used to do and can no longer do. That is not a criticism, it is a recognition of the evolving economic, political times in which we live.
MR. OLIVE: Mr. Chairman, if I could, just two more points. You just mentioned $25. Is that the annual fee to join MIANS?
MR. ARDENNE: For a single member, yes.
MR. PERLMUTTER: I think it is closer to $30.
MR. ARDENNE: Is it $30, $35? I am a corporate member so I don't pay that anymore. (Laughter)
MR. OLIVE: Just as an observation, $35 does not seem like a lot of money for the advantages, as you have espoused here, for the work that you do on behalf of MIANS for the members. That is easy for me to say, I guess, because I am not out there trying to make a living playing a guitar, or whatever, or singing, thank God. (Laughter) That is just an observation.
MR. ARDENNE: No, I think it is a fair observation. The organization has been moving the fee structure upwards. At the same time, however, the people about whom you are talking, are people who are investing their entire life savings, and some of that of their parents, in trying to create products that you enjoy, and find a way to get them to the market place.
MS. GRACIE: It is comparable with membership fees in national associations, CARAS, the Canadian Academy of Recording Arts and Sciences, and the Canadian Country Music Association. They all fall into about $45.
MR. OLIVE: How does that compare to, for example, the musicians' union, dues that are paid into an organization like the musicians' union?
MR. ARDENNE: Well, the musicians pay work dues and I think there are professional dues. David, you might know the answer to that.
MR. PERLMUTTER: Their annual fee, I think, is around $50.
MS. GRACIE: Yes.
MR. OLIVE: There seems to be quite a discrepancy between the two, for the quality of service that you provide and the quality of service that they provide. Not that they don't provide a good quality, but I am just saying that there seems to be quite a difference in the range. I am not familiar with the program so I may be out in left field here.
MR. PERLMUTTER: There is quite a difference in really, I think, what the two organizations are about.
MR. ARDENNE: And it depends which local you are talking about too; the mainland local is a lot more expensive than the Cape Breton local.
MR. OLIVE: It is just that I do know some people that are in the union and some of the comments that have come from them is that it does appear to be somewhat restrictive in their ability to promote themselves and do what they want to do; yet, they pay quite a lot of money to have those kinds of restrictions . . .
MS. GRACIE: But those performing artists in, for instance, the bar circuit would have to, ultimately, be a member of the union.
MR. OLIVE: Exactly.
MS. GRACIE: You don't have to be a member of MIANS, so it is a little bit of a . . .
MR. OLIVE: I guess one other point, if I may, Mr. Chairman, regarding funding. We talked about the Department of Culture. I think, Michael, you mentioned, if I heard you correctly, that there were services provided through Culture years ago that are not provided
now. Because there are obvious advantages to organizations like yourself to be doing this work, instead of having government always do it, have you ever or have you recently identified functions, and dollars attached to them in Culture, that don't have to be done by a civil servant, don't have to be done in government, could be done by MIANS and that if those funds and responsibilities were transferred, everybody would come out a little better off?
MR. ARDENNE: That is an ongoing discussion we have with senior officials in the department. From time to time, there are specific projects and exercises that they would ask us to undertake, for which MIANS . . .
MR. PERLMUTTER: We get 15 per cent.
MR. ARDENNE: . . . would receive an administration fee that is lower than the private sector would give us.
MR. PERLMUTTER: Usually that is always the kind of thing where, once again, the government is taking an initiative, spinning it out to an organization like ourselves to administer. We take in an administration fee but, again, it starts with the government getting involved with some form of direct investment in the industry.
MR. OLIVE: Just a clarification, Mr. Chairman, maybe I didn't make myself clear. What I am suggesting or asking is whether or not you have gone through this - and I heard somebody say program review over there. We went through our program review and identified things that could be done by the private sector or that shouldn't be done by anybody at all.
I am wondering if you have had an opportunity to discuss with the new Tourism and Culture Department, functions that directly affect and direct what you do as an industry that, in fact, you could say to the government, you don't have to do that in-house, we can do that for you on our own. You provide us with the equal funding or at least a fair portion of the funding you are now spending to do that. I guess if that hasn't happened, perhaps that should happen.
MR. PERLMUTTER: I think I will ask Mike to respond to that.
MR. ARDENNE: Okay. I have had some conversations with the department on that. You indicated in earlier comments - and I was going to follow up - that the reorganization of the Tourism and Culture Department is complete. I was not aware that that (Interruptions)
MR. OLIVE: Well, I said it was my understanding . . .
MR. ARDENNE: I'm sorry?
MR. OLIVE: I can't say that it is fully complete but (Interruption) Yes.
MR. ARDENNE: I understood that there was some consideration of that under way. My office is located directly across the hall from them. I haven't had that specific conversation that that has been completely finished at this point.
In direct answer to your question, have we sat down with the department where they have said to us, those are programs that we no longer need to do, the private sector can undertake those, would you consider submitting a proposal or whatever, would you talk to us about doing that, to my knowledge, no, we haven't had that direct a conversation as yet. We would look forward to it, recognizing, of course, that we and our staff have an extremely full palate; they are very busy. So if we are talking about moving and the possibility of shifting programs, then obviously there is a staffing component that becomes a concern to us. It is not a barter system, it is just really practical; how much can two people effectively accomplish within a 90 hour work week, each?
MR. CHAIRMAN: Thank you very much. Barry.
MR. BARRY BARNET: Just a couple of quick points before I go into two main areas. One is to lodge objection to something Russell MacKinnon said about music being environmentally friendly. We know that not all music is environmentally friendly, right, Tim? (Laughter)
MR. OLIVE: Yes, that's true.
MR. BARNET: Some of it, from time to time, we have been told to close our doors.
MR. MACKINNON: I can't speak to the Tory caucus. (Laughter)
MR. BARNET: I guess the second quick point is I want to congratulate the association for the work they do for these emerging artists. I know that a personal friend of mine has been an emerging artist for 30-some years. (Laughter) At some point in time, he will come through, I'm sure. But he is the type of individual who has actually eked a living out of the music industry for over 30 years, that's all he has done. He has been in some successful bands but never really seemed to make the big stage. But someday he might and the association and all those people involved with the music industry will probably share in his success.
A couple of things. One is that it appears to me, as somebody who is not involved in the industry, that the music industry doesn't seem to share the success of others. It would make sense to me that some sort of branding program, particularly for Nova Scotia artists where you look at trying to piggyback off other success to try to promote Nova Scotia music outside of our own borders, would be something that would be beneficial to emerging artists and to the artists, right now, who have CDs released. I would think something along the lines, whether it be a Nova Scotia logo and some kind of joint promotion, would benefit artists in Nova Scotia. Has that been considered, or is there a program right now that does that?
MR. PERLMUTTER: Not that we know of, no. There was an initiative through Years of Music where Nova Scotia music was being promoted . . .
MR. ARDENNE: Nova Scotia was being promoted.
MR. PERLMUTTER: Nova Scotia was being promoted through its music and there was some sort of branding going on and it was promoted nationally. That was effective in that one of the things that was marketed through that was a compilation CD that was marketed nationally in order to attract people to Nova Scotia. They would phone a 1-800 number, there was an ad going on during the broadcast of the East Coast Music Awards, and there was a Nova Scotia Tourism ad where you could phone the 1-800 number and they would send you this promotional CD, that kind of thing. The Nova Scotia logo we had was the Nova Scotia flag actually, and in that case there actually was some branding there. We had some very high-level artists on that CD together with some more emerging artists as well. I think that was the only initiative, that I know of, that might be in the variety of what you are speaking about.
MR. ARDENNE: There is a classic example of something that was working and then somebody went and fixed it and it didn't work anymore. The Nova Scotia Years of Music Program, while it had some quirks in it that drove us absolutely nuts, I think was pretty much universally recognized by the music industry and voiced by our association as perhaps the most effective tool initiated by government to assist our industry in its history. Then it stopped. The reason it stopped was because its genesis was in tourism and marketing and not in the music industry development. That is our single, biggest problem, in direct response to your question, sir. Very, very often, music is exploited for the benefit of other industries; the fisheries product show in Boston, you take music down there and do it, the Christmas tree thing, you take music down there and do it, a tourism thing, you take music down there and do it. But the focus is always on another industry and we are the paid labourers.
When it comes time to put the focus on our industry, to create wealth, which is what we are all talking about here, is the creation of wealth, which is relative, wealth to a guy who can't afford to spend $35 on a MIANS membership is having $35 he can afford to spend on a MIANS membership, wealth to me is to be able to go out and hire that additional person that can take my company to the next level, the same thing with Andrée. There comes a point where you come to the edge of the cliff, where if you are not afraid of success, you have to jump the chasm and you can't jump a chasm in two small leaps, you die. It is time to make the big leap. To recognize the value of this industry and combine the business savvy of those of us who have struggled and learned off the street with the incredible creative genius of some of the best writers, story tellers and songsters that North America can offer. So when it comes right down to it, we are talking here about the big picture and we are trying to draw a big picture with very tiny pens, you can't do it. You need the paint brush.
Man, I got off on something there. Sorry.
MS. GRACIE: You open so many doors. It is an education for people, when you talk about musicians and this art form and they are artists. I just had a flash there of the SOCAN fees
- the big issue that was on the table - I count on that, some weeks I count on that SOCAN cheque to buy groceries, but when people put on a charity, they pay for the food, they pay for the hall but they ask the musicians to play for free, oh a musician can sing for an hour but that is how we make our money. It is always forgotten about.
Another thing, on how important - this is on your point a bit - I was in Saskatchewan two years ago and we did a 21 day tour of Saskatchewan and the Saskatchewan Lottery and the Government of Saskatchewan have a program where they bring music to every community you could possibly imagine in Saskatchewan and the mandate is to not only employ musicians but to bring arts and culture to all the communities in Saskatchewan. We have travelled from Shaunovon, down by Montana, to Hudson Bay in northern Saskatchewan and I can't do that here. I can't bring John Gracie's music to Digby and to Cape North or whatever, and I tell you these places were as small as that. So we had to be creative because we are not only benefiting the music industry but we are benefiting the people of our community, making them more cultured and bringing arts to them. So there are a number of things that we can discuss to better educate people on the importance of this industry.
MR. BARNET: My second point and I am not trying to relive my youth but I know that I have missed something in the past and that is outdoor music festivals. I used to be a regular goer to the Atlantic Folk Festival in Hardwood Lands and it was great.
MR. ARDENNE: Very few people will admit that.
MR. BARNET: Look, it was fantastic.
MR. ARDENNE: I recognize your bravery.
MR. BARNET: I think everybody who goes through their teen years ought to have something like that. I won't go any further. (Laughter) It is starting to bring back some memories, maybe it was not that great. But it seems to me that with the exception of the Stan Rogers Folk Festival and some others, and we know that Fish Aid had limited success, but it seems to me that in Nova Scotia, there isn't enough of that type of thing, that there is some room, some opportunities there. I wonder why, and I am asking the question, is it particularly during our summer months, that we don't have one a week?
[10:30 a.m.]
MS. GRACIE: Tourism marketing department calls us the Festival Province of Canada.
MR. BARNET: Well, we are missing the loop on the music that I want to hear.
MR. ARDENNE: They are out there, but the big problem is sponsorship. There is no money out there. So, who owns the festival? Either a community group who is operating under a board of directors, who more and more often now are being held liable for financial losses,
individually liable for financial losses - it sometimes is very difficult to get insurance for that - or promoters: the Great Big Picnic promoters and things like that. You cannot get sponsors.
There is no philanthropy in government and there is no philanthropy on the street anymore. It is all what traffic does it bring. You can't get money out of a beer company; you can get a rebate based on how much beer you sell, which may or may not be to the benefit of your festival. So it becomes a very difficult balancing act in order to put a new festival on. The Stan Rogers Folk Festival is an incredible success story, but they have some unique characteristics that make that work. But those festivals are out there.
MR. BARNET: I know they are out there, like the bluegrass music, they are all over the place and they are every weekend and I know that. But it just seems to me that the big festivals - I took the time this summer to go across this country and I think I was one step behind a number of acts all the way across the country. I noticed the festivals going across Canada and big music festivals. Every province in this country had them almost every weekend somewhere; if you drive two hours in one direction, you are going to a music festival with big acts and literally thousands and thousands of people.
It doesn't seem that we have the big shows here in Nova Scotia. I think that there is capacity, be it a not-for-profit or for-profit festival and I am just amazed that somebody hasn't taken the initiative, particularly in the metro area or somewhere in the peripheral, to develop and promote a two or three day festival that would either be for profit or not for profit.
MR. ARDENNE: I think if the market conditions are right, then it will happen but nobody is going to go, where is the $1 million, which is what it takes. It is going to take $1 million to do it successfully. It would be like starting a business with not enough capital if you tried to do it for much less than that.
MS. GRACIE: And you have to have longevity. I was involved with the Louisbourg 500th Anniversary, and I submitted a proposal of putting the festival on, that unless it is sustainable, there is no sense opening bed and breakfasts for all these major festivals unless the festival can sustain itself in the future, because people are putting their heart and soul into this and opening businesses and counting on it and then the festival fizzles. But I can tell you, and I know that maybe they are not as glamorous, but that is how I run my household, on the festival circuit. So there are a number of festivals. Maybe it is a Tourism marketing job on getting the people of Nova Scotia to get out and support these local festivals because I travel all summer long, from May until September, on the festival circuit and there are certainly vibrant festivals that just need people at them. That's the biggest problem, we are not getting out there and supporting them. But that may be another issue.
MR. CHAIRMAN: Mr. Dooks.
MR. WILLIAM DOOKS: I have enjoyed your presentation but, Mr. Chairman, I think a lot of issues have been brought up here today and I don't have any further comments to make.
But we do thank you for music, it makes a sad day happy sometimes for us all. So good luck to you.
MR. CHAIRMAN: Mr. Chisholm.
MR. RONALD CHISHOLM: Just maybe one quick point. Stan Rogers Folk Festival has been mentioned here and it is in my backyard. Just what sort of an association would you have with the Stan Rogers Folk Festival; would you be involved with it? Another one, I guess, is the Granville Green Concerts in Port Hawkesbury on Sunday nights, and Celtic Colours down through Cape Breton in the fall.
MS. GRACIE: They are all members of the organization. The Stan Rogers Folk Festival is a nominee at our music awards this year. Certainly, Troy Greencorn sat on our industry educational panels during Nova Scotia Music Week, so we have a close connection with them.
MR. PERLMUTTER: We get involved with the advertising and promotion for the festival.
MR. RONALD CHISHOLM: I know that is one of the major ones in the province right now that seems to be quite successful.
MR. ARDENNE: The Stan Rogers Folk Festival has made a name for itself right across the continent. It is basically synonymous with your backyard.
MR. PERLMUTTER: The members of our board all have what we call a portfolio, an area of responsibility. One of them is the festivals and events portfolio, presently held by James Stewart who runs the New Glasgow Riverfront Festival. So he is active in interfacing with other festival runners and promoters and as the festival goes year after year and is quite successful, he brings his expertise to that.
MR. RONALD CHISHOLM: Well, I guess, Mr. Chairman, through you, prior to today, I didn't know, really, much about MIANS and I certainly appreciate the fact that you are here and made this presentation to us. It is quite informative. Thank you very much for that.
MR. PERLMUTTER: Well, thank you very much.
MR. CHAIRMAN: You wanted a quick comment, Don?
MR. DOWNE: Just a quick comment. We talked about the tax credits. We have been promoting that and, hopefully, the government will see that as being a positive initiative in the upcoming budget. It is one that we are continually pressing for and will continue to press for.
One other area that I think is important, it was mentioned - I think Tim, maybe, touched on it - was the issue of - I remember we had these trade missions around Europe or the United States. I remember taking a bunch of forestry guys down to Boston. We got on the Bluenose and
we sailed up the port of Boston, we sold lumber and we went from 3.6 per cent of the market share to 38 per cent to, now, 65 per cent of the market share, of our exports are in New England.
Are we doing anything, specifically, with trade missions for music? I remember being in a trade mission in Washington, D.C. with the IT sector, a $3 billion industry. They needed government to open doors with other governments or other industries, to say, this is what we can do. We need to find an angel investor or a corporate angel investor, or a partner to leverage the IT industry here with worldwide IT access. Venture capital is hard to get and people are reluctant to invest in certain companies.
Could the same concept be used with music, in regard to opening doors that are impregnable, to some degree now? Andrée, as you are going down to different initiatives - I remember Exit 13 in Bridgewater, trying to find money to go to one of these areas that would open up a door for their music, in our area, that wasn't done. I don't know how many groups I had to go to, to get some money for those guys to go down. Since then, they ended up cutting another album out of it.
It seems that we could be doing so much with these trade mission initiatives that are geared and tooled specifically for the music industry that we have never looked at. I think that is an initiative that development - it ties in with some of the strategies that government is looking at and, with the change of Tourism and Culture, specifically, in the area of culture.
Anyway, I just throw that out as a suggestion. I think it is a . . .
MS. GRACIE: I have been fighting that forever. There is, sort of, different programs but there never have been effective programs where they actually bring a team of artists down, bringing the buyers so that they actually can interact through, maybe, a reverse trade show and performance. I suggested this a number of times and - really focused trade missions, you know.
I'm on the WIN Exports Program, and usually I will get notification on - I think there is one down in New England next month. But it is not focused. It would not be effective for me to travel because I know they wouldn't know the appointments to make for me so it would be focused.
MR. DOWNE: Excuse me, just for a minute. I remember doing - when we were in Europe and we were doing an offshore one. Then we had the Nova Scotia song and they had all the pictures of Nova Scotia. Evans and Doherty, you know, they were singing. Anyway, that was the backdrop but we were there, specifically, with offshore, offshore technologies and we brought people here - whatever industries, specifically to learn and how to connect.
MS. GRACIE: Yes.
MR. DOWNE: We never did anything, that I know of, specifically for music, to go somewhere, to definitely connect. That is the issue, I think, we can . . .
MR. ARDENNE: Well, you have illustrated the point I was making earlier, exactly, in terms of using music for the benefit of other industries. I did have conversations with the Nova Scotia office in Boston last fall. There was a potential for a music-focused mission into New England in December and it died on the order paper somewhere. I don't know whatever happened to it but we had some preliminary discussions on that.
It is something that is vitally important to the development and success of this industry, and there were two key areas, it seems to me. One is our north-south link in the Boston area, which I think would be more effective than New York, but certainly that is debatable. The other one is western European, that huge mass of people, probably centred in a place like the Netherlands where there is a particularly friendly link between Canadians and the Dutch people. But because there are very few borders now in Europe and the Euro dollar has come into effect, things like that, it is much easier to move people and product throughout western Europe. We would very much look forward to partnering with government on developing initiatives in both of those areas.
The export thing that Andrée talked about, I received the same information, Andrée. When you are talking about businesses like ours and there is nothing specific that relates to the music industry in this thing that is going on in New England. It was $1,000 or $2,000 per person, provided your airfare and leads but it didn't tell you very much about whether the leads were going to be focused, specific or whatever. Then you had to be responsible for your own hotel, meals and other things. If you take a look at the cost of participating in that - and I just recently did an event in Boston and the hotel was $272 U.S. a night. So if you go down there for three nights and try to eat well, do you realize how many shows I have to sell, or whatever commission I can get, to even come close to paying the cost? It is not feasible.
MR. PERLMUTTER: I think, though, that this is an area where MIANS really ought to, and can, take some leadership, and as we have been recruiting - we had to recruit a new executive director recently. As part of that interview process, one of the questions that had to be answered is, what is your vision for international marketing and export development? Certainly, to become a force and developer in trade missions, was a common theme.
Many of our artists tell us that they have used Canadian embassies to great effect. The Canadian embassies, when they go places, are really helpful. They set things up for them and do try to cultivate contacts for them. That is how it starts.
We have been incredibly successful in marketing Acadian music in France and Belgium, of late. We have had assistance from the embassies. We have had assistance from ACOA, in terms of running those programs, so much so that I think they had a whole festival of Acadian music in Belgium. I believe it was last summer; maybe it is planned for this summer. One of our board members, Gerry Boudreau, whose portfolio is Acadian music, is spearheading that. He has been enormously successful with bands like Grande Dérangement and Blou.
MR. CHAIRMAN: Thank you very much. Two very quick questions, if I may. You mentioned in the Music Industry Survey report that one of the problems the industry faces is not
enough airtime on local radio stations. What is the reason for that and is there anything that we can do to help that? Is that because they are owned outside the province now? Why do local radio shows not give you much airtime? According to the survey, this is what . . .
MS. GRACIE: It is an ongoing problem across Canada. We talked about, at the beginning of the conversation, the CBC and you know, 30 years ago CanCon was introduced. Radio is there, basically, not to support music but to sell advertising. We all know that. It is easier for them to play top 40 Billboard hits than it is to insert local artists. Michael, maybe you can add to it, but it is an ongoing challenge.
MR. ARDENNE: I think, coupled with that, the very significant role or very significant response to the question is radio is there to sell advertising and not to develop artists. Radio is not going to sell you. Now, as we become more and more developed in our abilities in a whole variety of areas, including production, song writing and management of promotion, there are some inroads being made.
There are two other things to think about here or to consider in this whole thing and they are challenges that we have not overcome yet. One is the fact that an awful lot of radio programming now is - radio stations are owned in the convergence market. They are owned outside and you have syndicated programming. One particular guy sits up somewhere and he might program five hours a day for 26 or 30 radio stations across Canada. The local station gets that package, it comes in on a feed, right? There is nobody in the radio station, kind of thing.
Another thing is that the independent radio stations are, however, becoming increasingly aware of the local product and becoming increasingly interested in it. That, I will venture, is a direct result of a relationship that was initiated by the Atlantic Association of Broadcasters with MIANS, where we are given an opportunity at their quarterly meetings to make presentations which we take advantage of. We meet with them. They now have one of their board meetings at the time of the ECMAs in the city of the ECMAs. Our association, along with our sister organizations in other provinces, have a very vital role to play in that agenda.
From the Valley, Radio Atlantica - what is her name? - Jocelyn Dylan's program is now getting syndicated on some other radio stations. It is gaining, again, through the popularity, through the Internet and through the marketing efforts of people like Andrée and others, some foothold in the independently owned radio stations. We can only hope that those radio stations that are owned by conglomerates will start to take notice of the fact that some of our listeners are switching over at very significant times of the week.
The other thing that we have, of course, and one can't leave a discussion on broadcasting without indicating the absolutely phenomenal support that we get from regional CBC Radio. It is unbelievable. The Saturday morning show has I think something like over 40 per cent of the listenership. Why? It is because they are focusing on our regional music and our regional artists. Not because they are regional artists, because they are good.
MS. GRACIE: I just came back from a major conference in the States, and the majority of American artists are being played on public radio throughout the U.S.: the universities, folk stations and so on. That is where people are tuning in to listen to different music and not, sort of, mainstream elevator-type music that you will hear on commercial radio anyway; you know, 96 minutes of things that are the same.
MR. ARDENNE: Non-stop pop.
MS. GRACIE: Yes. People are tuning in to - like they do with television - public radio to hear different things.
MR. CHAIRMAN: Tim, did you want to come in on this issue?
MR. OLIVE: Just to follow up, what happened to Canadian content? The federal government, years ago, ran around with its Canadian content, saying that a certain percentage of the number of hours on the radio had to be used for Canadian content. I see you smiling, Dave, but what happened?
MS. GRACIE: Well, 30 per cent of Canadian content could be 30 per cent Bryan Adams, Céline Dion and Shania Twain.
MR. PERLMUTTER: That's right. We have fantastic Canadian successes. It's just that . . .
MR. OLIVE: It's just not regional Canadian content.
MR. PERLMUTTER: No.
MR. ARDENNE: They talked a few years ago about increasing the content. It was, effectively, increased, the Canadian content rose. The reactions of major broadcasters? Well, that doesn't mean the artists you are trying to promote are going to get on the radio. It just means we have played Shania Twain seven times instead of six times. (Laughter)
MR. DOWNE: I think it is a definition of that, I guess, is really what Tim is trying to get at, the definition of Canadian content. What you are saying is, let's get some new emerging artists that are there as part of this Canadian content and not just the top five . . .
MR. OLIVE: You made a comment that radio is there for advertising and not to promote artists. You go back to the Buddy Holly story. If it wasn't for radio, he wouldn't have gotten anywhere. It was radio that put Buddy Holly where he was, originally.
MR. ARDENNE: At a time when radio was the only way . . .
MR. OLIVE: It is a shame we cannot do more of that for local talent.
MR. MACKINNON: It worked for John Buchanan for 17 years, Out on the Mira. (Laughter)
MR. CHAIRMAN: This is really more a comment than a question but I would invite any response you give to it. When I came from an urban church in Ontario to take a country church in Nova Scotia, I was absolutely blown away by the musical abilities of the people in the community and in the church. What I found out was, it was very typical in these country areas for entertainment for teenagers, for example, before television and the Internet exploded, and all those, to get together and sing. On a Saturday night they would have a jam session, et cetera.
Now that has changed as people get focused - and I tie it in with what Darrell was saying about the VLTs and tie it into their video games - and that sort of pool of interest seems to be changing due to changing cultural, social patterns and technology. I am not terribly sure what to do about it, to tell you the truth, but I think Cape Breton has benefited from that same sort of culture and we see the benefits of it. As that begins to disappear, I think there is a problem. This was just a comment; if you want to respond to it, you are welcome to. It wasn't really a question.
MR. PERLMUTTER: We don't see social changes as attenuating the vibrancy of the artistic community in this province.
MS. GRACIE: Tenacity. (Laughter) I believe you have to look at the music industry as a business, like every other business, and people just can't seem to do that. There are going to be successful farmers and there will be successful politicians; not everybody here will be the Premier. The greatest compliment I got when John won the East Coast Music Award last year - he won it in 1990 and he won it in the year 2000 - was sustainability. So if you can have a product and you can hang in there and work, like any business, and sustain your business and then still go after the brass ring - I am sure every one of you here still has goals - I think that is so important to realize, that this is a business. We consider it a business and we still try to grab the brass ring at the same time and achieve different levels of success. But it certainly is like everybody else's business.
MR. ARDENNE: I would just make the comment, sir, that I think perhaps your concern or observation about the diminishing, perhaps, of the participation level of young people in music may be a reflection of our generation and not theirs. There is absolutely no shortage of young people coming into my office with ideas and bands and things like this, that are doing it in a different way. They are listening to music that we are not particularly listening to, just like we did with our parents. They are still buying a ton of product out there that may not be the stuff that we buy, but certainly the membership in our organization continues to be strong. The attendance at all of our seminars is increasing. If you take people at the conservatories, the music conservatories, the private music lessons, the Musicstop people and things of that nature, you see the ad in the paper constantly from Musicstop, they are looking for new staff. That is a human resources problem, by the way, right? You don't have the base of trained staff there.
As long as we recognize that emerging genres are just as important as emerging businesses, I think our health in this industry is for the future. The creative people are there, but we need to develop the business infrastructure support people so that they can maximize their potential.
MR. CHAIRMAN: On that note, it is probably a good time to end. I want to thank David, Andrée and Michael; thank you very much for coming.
Our next meeting as a committee is under the ABC hat, and that would be January 30th. We weren't able to fit one witness on the music industry in this meeting and we are wondering if, with your agreement, if we did the ABC work first and then we brought in Mr. Rob Cohn. The times there are just approximate. We don't know; the ABCs, of course, have to be done. We have three names so far, but we may have more by then, so it may take longer. But we are wondering if we can have your permission to sort of piggyback on that meeting. That's very much at the will of the committee whether you agree to do this or whether you want to schedule him at a separate time.
Is it agreed?
It is agreed.
After our next ABC meeting, we will be talking a little bit more about music, then we will discuss what we want to do after this.
One last comment I want to mention is that Jim Spurr's last day with the government is Friday; he is going to be legal counsel to PanCanadian Petroleum. He has been part of our committee, so I would very much like to send him a card on behalf of the committee and a small gift. I will pay for the gift out of my resources. If you want to contribute (Interruption) That's already spoken for, but you can contribute to the small gift.
Is it agreed that we recognize him in this way and thank him for his work?
It is agreed.
We are adjourned.
[The committee adjourned at 10:55 a.m.]