Canadian Business Press - Submission on Improving Canada's Digital Advantage

Summary

The government has provided an economic environment for Canadian publishers by restricting foreign investment in cultural industry that has led to healthy, profitable media companies that provide a unique and valued Canadian voice on how business is conducted in Canada and how Canadians can succeed in this market and the global economy. Now the challenge of the digital content delivery can be tackled from a position of strength.

Overriding message: "Canadian business–to–business (B2B) integrated media companies provide compelling content for Canadian audiences both in print and online."

The B2B publishing industry needs the government to maintain funding levels for traditional media as well as digital media and ensure that public policy supports traditional media without a bias towards digital. Our audiences are not either print or digital. They are engaged in a combined information gathering process through print, online, mobile apps and video.

Further, the government needs to recognize the need for training of older workers to the new ways of communicating and offer incentives to business for the transfer of skills. A "no one left behind" mind set should permeated policy making with regards to supporting Information and Content Technologies (ICT).

At the same time, development of standards in the delivery of content would reduce the research and development cost of individual content providers, thus reducing barriers to entry for existing companies. To that end, the government should work with industry groups such as CBP to develop standards for content formatting and delivery, such as could be used in digital content delivery through mobile apps.

Tax incentives work for some industries, however in the B2B publishing sector the profitability is very low and so tax incentives are not always an advantage. To that end, the Canada Periodical Fund is a more flexible and better model for business publishing but we need stability in the funding going forward to ensure that Canadian content will find a place in the mixed media digital age.

Submission

Who We Are

Canadian Business Press (CBP) represents an industry of more than 740 business and professional publishers of information vital to decision making in the Canadian economy that ensures Canada remains competitive, innovative and is providing secure employment for workers in this country. The impacts that the business media (print and online magazines and websites) has on the digital economy cannot be understated as research commissioned by CBP and conducted independently by Starch Research in four consecutive studies that B2B publications rank as the most influential source for information among seven key industry sectors in Canada — agriculture; automotive and trucking; computers and technology; resources and construction; manufacturing; retail; travel and tourism. That influence extends to providing value information about the digital economy and how Canadian companies and the professions can benefit from online technologies and online information.

It has been said that for every industry, profession or business in Canada there is a specialty publication aimed directly at keeping its participants informed about their businesses, about what's new and interesting to them, and what trends they can expect in their respective fields. However, since this type of business media is so carefully targeted to specialized audiences, many people are simply unaware of its existence or of how broad the industry really is.

Doctors, lawyers, teachers, construction companies, oil workers, grocers, benefits professionals, dentists, pharmacists, welders, pilots, hard goods retailers and automobile dealers all have their own publications geared to their particular needs, as does almost every other industry, profession or business in the country. Business and professional publications provide reliable, industry–specific news and information as well as being repositories of knowledge on the sectors they cover and are the ultimate targeted medium. Their raison d'être is built on reaching and serving highly specialized targeted groups of Canadians in business, agriculture and the professions.

The Canadian Business Press (CBP) is the industry association for Canada's 740 business, professional and farm publications across Canada. Our publications — known as "B2B publications" — are important sources of information exchange across a wide variety of industries and represent fully 27% of all magazine titles in the country.

Our members' B2B publications keep readers informed on trends, products, services and items of interest that specifically impact the communities they serve. They are important instruments in the sharing of Canada's business culture and are consistently rated as the number 1 credible source of industry–specific information for business decision makers.

B2B publishers serve every conceivable specialized business in Canada from the Canadian perspective and reflect Canadians' distinct view on issues, opportunities and challenges facing the nation's businesses and professions. Perhaps most importantly, our members produce periodicals that are important to the Canadian economy because they are designed and written for readers who are looking for new ways to improve productivity and to be more competitive in the global marketplace.

B2B publications represent:

• 27% of all magazine titles in Canada;
• 25% of magazine industry revenues;
• 25% of magazine industry expenses;
• 29% of full and part–time employment;
• 30% of remuneration paid to full–time, part–time and freelance magazine employees.

Magazines published by our members include: CGA Magazine, published by the Certified General Accountants Association in Burnaby, British Columbia; Canadian Consulting Engineer, published by the Business Information Group in Toronto, Ontario; Journal of the Canadian Dental Association, published by the Canadian Dental Association in Ottawa, Ontario; Oilweek, published by JuneWarren Nickle's Energy Group in Calgary, Alberta; and Québec habitation, published by APCHQ in Anjou, Quebec — to name just a few.

One trend that is worth noting is that as many print and broadcast journalists face lay–off especially in community newspapers and local television, many are finding employment — sometimes as freelancers — with B2B publications. Their investigative journalism and work shedding light on important issues is now covered in vertical publications that have the space and sophisticated readership to understand and dissect important issues affecting Canadians. While the primary mandate of B2B publications will always be the dissemination of industry news, the role of these publications in exposing and debating public policy issues is increasing in importance.

ICT Challenges for B2B Publishers

Legacy Industry Faced with the ICT Technological Revolutions. Traditional Canadian B2B publishers have ink on their hands from hot–off–the–press editions of their magazines. The printed version of a magazine is the legacy part that many of our member's do not wish to see go away, and quite frankly, most of their readers are of the same mind. New media will join other traditional media forms — radio, television and print — as a complement form, not a replacement.

The reality is, however, that print and distribution costs of the printed magazine are becoming prohibitive in some sectors where the number of potential advertisers is shrinking due the merger and acquisition. At the same time, some sectors have decreased in size due to the fallout from the recent economic turndown. If legacy publishers do not adapt to the ICT revolution, they risk becoming extinct, and with them the content their publications provide to vertical markets from a Canadian perspective.

B2B publishers have recognized the trends and move to be part of the revolution. As an example, the B2B magazine sector has seen revenues from digital income grow to 30% and in some cases 40% of total revenues. Canadian B2B publishers who are rapidly becoming integrated media companies (trade shows, webinars, print and online) are establishing themselves in the workflow of their audiences providing the information that they need to do their job with day–to–day tools.

The Future of B2B: The Role of Digital Media. The Canadian Business Press believes that our ability to overcome the challenges facing our industry is dependent — in large part — on our ability to adapt to new distribution methods and ways to reach our audiences. New media choices provide a great opportunity for B2B periodicals to extend more content to larger audiences, ensure the long–term loyalty of their readers and add new and creative business models.

Furthermore, digital methods offer an alternative to traditional, high–cost distribution models. Editorial content which is 'born digital' drives down costs substantially, especially print and distribution costs. The potential is also there for Canadian–based content to be shared internationally, thus promoting Canadian business sectors and knowhow.

However, as the B2B industry embraces digital media, some concerns are emerging:

• The move to digital represents a high–risk investment of capital with uncertain returns.
• Advertising revenue is lower and advertisers expect on–line and off–line together to be the same price as the print–based publication (i.e. no incremental new revenue from adding digital product).
• Foreign competition is even more intense as large, mostly U.S.–based content creators have greater scale. Digital properties cross borders instantaneously.

Canadian Business Press believes the future of our publications will continue to see a mix of print and digital, but that to preserve a uniquely Canadian perspective for many of its publications, it must have equitable access to Federal Government support to undertake the necessary skill acquisition, research and development to meet the ICT challenge.

Foreign Competition versus Canadian Content. Foreign specialized B2B periodicals have the advantage of a larger market size and home grown manufacturers to support them. Thus, these publications can leverage their superior resources to enter the digital content world where there are few if any barriers to transmission across international boards. It is no longer enough for Canadian publishers to provide content; they must now also own the delivery medium. Websites have been the leading edge of content delivery, but that too is being challenged by the development of Apps for content delivered on handheld devices. Owning and distributing a publication now also requires development of specialized App for a number of platforms, such as Apple (iPhone and iPad), Blackberry, Windows Mobile and Google Android. This is just the latest in the new ICT delivery medium, where revenue model can allow for content distribution supported by advertising or a pay for service basis.

Our predominantly small business based publishers must had the needed access to R&D dollars to grow their delivery model from a single paper base one into an array of ICT based alternatives. This ICT revolution is not something that is coming, it is here now. Just visit an Apps provider, such as Blackberry, to search for magazine apps. Many will come up, but few Canadian ones.

Mobile devices are an emerging platform for B2B information and an investment in secure networks and development of business applications that brings vital information quickly and conveniently is very important to the health of Canadian business. Many B2B publishers are already investing in technology for mobile applications but development costs can be high.

Having this as the background to your recommendations, the CBP wishes to address the specific questions laid out in the Improving Canada's Digital Advantage: Strategies for Sustainable Prosperity.

Capacity to Innovate Using Digital Technologies

Should Canada focus on increasing innovation in some key sectors or focus on providing the foundation for innovation across the economy?

Yes, the CBP strongly recommends that the government should focus on leveraging the existing information content providers skills with the new digital Information and content technologies (ICT). B2B publishers have extensive knowledge in specialized marketplaces which can use assistance in moving to new forms of content delivery.

Which conditions best incent and promote adoption of ICT by Canadian businesses and public sectors?

Promotion of Canadian content is of vital importance to the knowledge base manufacturers and service sector firms require to augment their productivity and market penetration. Incentives should in place to allow content providers to undertake research across the country and internationally.

What would a successful digital strategy look like for your firm or sector? What are the barriers to implementation?

A successful digital strategy would be one that positions it as complementary media to traditional media — radio, television and print. The barriers to this integration are costs of developing the skill and resources needed to deliver content in a multiplicity of forms. Leveraging content in different forms requires B2B publishers to invest in new skill sets with their staff, and heavy investment in technology.

Once anti–spam legislation, and privacy and copyright amendments are in place, are there new legislative or policy changes needed to deal with emerging technologies and new threats to the online marketplace?

Ownership of content and the right to use, and reuse it, are important rules which must be established. Traditionally there has been publishers' with in–house editorial staff, and some external freelance content providers/writers. The owners of material developed under contract for a given publisher must be protected so that the publisher who has made the investment in the content can leverage it a number of different forms.

How can Canada use its regulatory and policy regime to promote Canada as a favourable environment for e–commerce?

As already mentioned, the government has provided an economic environment for Canadian publishers by restricting foreign investment in the cultural industry that has led to healthy, profitable media companies that provide a unique and valued Canadian voice on how business is conducted in Canada. Maintenance of these policies is paramount to the success of a vibrant B2B Canadian publishing industry.

Building a World–Class Digital Infrastructure

What speeds and other service characteristics are needed by users (e.g., consumers, businesses, public sector bodies and communities) and how should Canada set goals for next generation networks?

Speed is paramount in content delivery, especially if video and sound are added. Canada has lagged behind other countries in development of its own internal networks, a situation which should be rectified as soon as possible.

What steps must be taken to meet these goals? Are the current regulatory and legislative frameworks conducive to incenting investment and competition? What are the appropriate roles of stakeholders in the public and private sectors?

Invest in infrastructure to build a truly national network where all Canadians have equal access to the content for their use through Canadian networks. In delivery of Apps, and similar technologies for content distribution, the government should be facilitating standards for to make the formatting and reading the data input. This would allow industry groups to collectively invest in content read apps which could just be rebranded for individual content suppliers, thus reducing the barriers to entry into this new median.

What steps should be taken to ensure there is sufficient radio spectrum available to support advanced infrastructure development?

Spectrum availability should be controlled by the government and leased to providers with expectations, and thus conditions, of specific delivery objectives. When these are not met, resulting in under utilization of the spectrum, the government should have the right to reallocate the spectrum to other providers. There must of course be fair adequate oversight to ensure that all parties are treated appropriately.

How best can we ensure that rural and remote communities are not left behind in terms of access to advanced networks and what are the priority areas for attention in these regions?

Given the costs of the traditional hardwiring or building of relay towers, other avenues must be explored, such as satellite.

Digital Media: Creating Canada's Digital Content Advantage

What does creating Canada's digital content advantage mean to you?

Creating Canada's digital content advantage means to the CBP moving our legacy publishing industry into new realms of content through electronic means. It also means being able to enrich the content by adding features not available in static traditional print media, such as audio and video content. Publishers now need to think of themselves as producers of content, not just purveyors of the printed word.

What are the core elements in Canada's marketplace framework for digital media and content? What elements do you believe are necessary to encourage the creation of digital media and content in both official languages and to reflect our Aboriginal and ethno–cultural communities?

A new set of skills must be learnt by B2B publishers if they are to fully exploit ICT. Encouraging education and retraining must be a focus of any government policy to ensure that ever sector can benefit from the new technology to ensure that as few as possible individual are allowed to retool their skill sets.

How do you see digital content contributing to Canada's prosperity in the digital economy?

Digital content will contribute to Canada's prosperity by the sharing of ideas and information. Canadian B2B publishers are uniquely positioned to provide the necessary skill and knowledge set in the vertical markets they serve to be a knowledge hub.

What kinds of 'hard' and/or 'soft' infrastructure investments do you foresee in the future? What kinds of infrastructure will you need in the future to be successful at home and abroad?

Investment in the development of standards for content delivery, such as already has appended with RSS streams, would assist in minimizing development costs and providing direction for existing business entities.

How can stakeholders encourage investment, particularly early stage investment, in the development of innovative digital media and content?

No comment at this time.

How can we ensure that all Canadians, including those with disabilities (learning, visual, auditory), will benefit from and participate in the Canadian digital economy?

No comment at this time.

Building Digital Skills for Tomorrow

What do you see as the most critical challenges in skills development for a digital economy?

The B2B industry has not traditionally had multimedia skill set required to thrive in the ICT world. Retraining is of paramount importance, otherwise older workers where much of the industry specific knowledge rests, will be forced out. Training for the new requirements of ICT will be one of our biggest challenges.

What is the best way to address these challenges?

Programs developed specifically to industry sectors which provide content to leverage it into an ICT framework. In the case of CBP members, this is related assisting in developing material relevant to the ICT through the Canadian Periodical Fund.

What can we do to ensure that labour market entrants have digital skills?

Drive curriculum towards the jobs that ICT will provide.

What is the best way to ensure the current workforce gets the continuous upskilling required to remain competitive in the digital economy? Are different tactics required for SMEs versus large enterprises?

Programs developed specifically by the industry sectors specific to their needs must be focused on. In the B2B publishing world that means providing education around gathering and distributing content within an ICT framework.

How will the digital economy impact the learning system in Canada? How we teach? How we learn?

No comment at this time.

What strategies could be employed to address the digital divide?

No comment at this time.

RECOMMENDATIONS

Our major recommendations are as follows:

1. The B2B publishing industry needs the government to maintain funding levels for traditional media as well as digital media and ensure that public policy supports traditional media without a bias towards digital. Our audiences are not either print or digital. They are engaged in a combined information gathering process through print, online, mobile apps and video.
2. Government needs to recognize the need for training of older workers to the new ways of communicating and offer incentives to business for the transfer of skills. A "no one left behind" mind set should permeate policy making with regards to supporting Information and Content Technologies (ICT).
3. The government should evaluate the feasibility of developing standards for the delivery of content which would reduce the research and development cost of individual content providers, thus reducing barriers to entry for existing companies. To that end, the government should work with industry groups such as CBP to develop standards for digital content formatting and delivery.