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Minister's Message

The Government of Canada recognizes that the cultural sector plays a vital role in building dynamic communities across Canada and contributes immensely to our economy. As a Canadian Heritage Portfolio agency, the National Film Board (NFB) works to engage Canadians in a vibrant cultural and civic life and encourages us to celebrate the uniquely Canadian nature of our country.

As a public producer and distributor of audiovisual works, the NFB plays a unique and essential role in the digital era. It has successfully harnessed the potential of the Internet and mobile platforms to provide avant-garde Canadian programming in both official languages. It has demonstrated leadership by charting the course for cultural enterprises that seek to meet the challenges of digital migration. The NFB sets the example when it comes to connecting with Canadians and encouraging their full participation in society.

In addition, the NFB provides an unparalleled environment for nurturing innovation and creativity for the benefit of Canadian artists, filmmakers, and distributors in all regions of the country. It develops Canadian creative and technological innovations that help our country play a leading role on the creative economy's international scene.

As the Minister of Canadian Heritage and Official Languages, I am pleased to present the 2009–2010 Departmental Performance Report of the National Film Board of Canada. This report illustrates the activities of the NFB during the last fiscal year.

The Honourable James Moore, P.C., M.P.

 

Commissioner's Message

2009-2010 was a year of economic uncertainty for Canadians and Canadian cultural industries, which have witnessed reshuffling with the consolidation and integration of media companies, brought about by the digital revolution. The global marketplace for financing and producing programming is still in transition. Adaptation to this ongoing turmoil is a complex process for all Canadian firms, small and large, public and private, and it involves a significant effort to re-imagine the nature of their organizational structures and operations. Ultimately, the success of their adaptation will determine how well they reach audiences, as well as the overall role they will play in Canada's creative economy, and on the global cultural stage. The Canada Media Fund is a step in beginning a restructuring of the support mechanisms for Canadian content, and for Canada's media industries. Yet, the preparatory work undertaken this year to replace Canadian Television Fund with the Canadian Media Fund has also underscored the difficulties we face in such a transition.

Mentioned in this year's Speech from the Throne, the digital economy will play an important role in sustaining and developing Canada's productivity. Digital cultural media, and the proficiency of Canadians in these media, form a key component of our success in this area. We must ensure that we keep pace with global developments, and that we establish a Canadian presence on all relevant digital platforms.

Canadians are avid users of digital technology. According to the comScore 2009 report¹, digital media usage in Canada has grown 11 percent over the past three years. On average there are more than 24.5 million Canadians online each month—among the world's highest Internet usage rates. Crucially, Canadians are also the greatest consumers of online video. The impact of mobile phones, and smartphones, will be profound because of their ability to penetrate where landlines and electricity are not widely available.

The ways in which the NFB has embraced the challenges of digital reveals the remarkable opportunities it offers for Canadian culture. Last year, our online screening room generated over 4 million views, 2.5 million of which were in Canada. To date, it has made over 1,500 productions available for viewing, a number that keeps growing as we move towards the digitization of our collection. In addition, the NFB iPhone application, launched in the fall of 2009, was an instant hit. iTunes Canada named it the year's best app and it has been downloaded over 200,000 times around the world, with over 500,000 views of films in Canada alone. There have also been many creative achievements on digital platforms. Waterlife, an interactive work directed by Kevin McMahon, offers a truly immersive experience that allows audiences to admire the beauty of the Great Lakes, and to understand the perils that threaten them. The project GDP-Measuring the Human Side of the Economic Crisis, directed by Hélène Choquette, is an in-depth exploration of the repercussions that have affected people across Canada, and involves the participation of more than 30 filmmakers and photographers who have produced 120 films for viewing the Web.

We have also continued to work the traditional areas in which we render service to Canadians. In addition to the digital projects, we released 112 new films which explore social issues that are important to Canadians, and that celebrate Canadian excellence and achievement in documentary and animation.

Today, the NFB remains distinct as a creative laboratory, as a leader in exploring terrain that cannot be undertaken by the private sector, as a voice for underrepresented Canadians, as a prime means to assure the vitality of a francophone culture and, not least, as one of Canada's leading pioneers in the digital realm.

This past year has required our attention in three major areas: (1) Creative Excellence in both traditional and digital media (2) Accessibility of our works and (3) a review of our organizational processes to adapt to the digital shift. We have learned where we have opportunities to better connect and engage with Canadians.

The example of the NFB shows what boldness of vision, commitment to change, and innovating with a clear focus on serving the public, can do to revitalize a venerable institution. Our continued success in today's changing media landscape will be achieved by focusing on the goals of our strategic plan, by keeping strong ties with our stakeholders, and ensuring our activities are aligned with the priorities of the federal government. Even if all the momentum is now with digital, traditional television is not going away anytime soon and continues to show remarkable strength and vigour, as well as a voracious appetite for programming. Our challenge is in feeding this greatly enlarged audiovisual behemoth with only modest increases in funding.

We often talk about the digital revolution in terms of an economic strategy and global competitiveness. There is, however, a larger story. As much as it is said that digital democratises media, it also risks dissolving social cohesiveness. The paradox of the virtual world is the isolation of connection. In moving forward we need to understand that something crucial is at stake here, and that it has to do with nation building. Canadians have a desire to connect with one another beyond individual interests—we saw this in their phenomenal outpouring of pride during the Vancouver Olympics, the events of which tapped into a deeply felt need. If we recognize this need, then digital can become a powerful tool with which to create social cohesiveness. Yet, such success relies on ensuring a public space in the online world. If these challenges are great, our opportunities are greater.

The possibilities for new platforms, new approaches and new ideas remain wide open. We will continue to use our creative energies, inventiveness and boldness to energize ourselves as a public institution that not only serves the Canadians of today, but helps build the Canada of tomorrow.

Tom Perlmutter
Government Film Commissioner and Chairperson of the National Film Board of Canada

 

SECTION I: OVERVIEW

 

Raison d'être and Responsibilities

Raison d'être

The National Film Board of Canada (NFB) was created by an act of Parliament in 1939 and is a federal agency within the Canadian Heritage portfolio. The NFB's mandate is to produce and distribute original and innovative audiovisual works that add to our understanding of the issues facing Canadians and raise awareness of Canadian values and viewpoints across the country and around the world. Throughout the decades, the NFB has also played an important role in marking the major changes and events taking place in Canadian society and has become Canada's best-known cinematic brand.

Responsibilities

As a producer and distributer of audiovisual works, the NFB provides a unique perspective on Canada's cultural wealth and ensures that Canadians have access to it through cutting-edge technological media. The NFB has opened new avenues for point-of-view documentaries, auteur animation and new media content and continues its creative thrust by exploring new horizons in the digital age. In an environment where the digital revolution is having a dramatic impact on the media environment, the NFB continues to be a distinct and essential creative laboratory. It broadens the range of possibilities for the population and the Canadian industry by taking commercial and artistic risks that the private sector is reluctant to take on. By supporting emerging filmmakers, members of diverse cultural and linguistic communities, Aboriginal communities and people with disabilities, the NFB ensures that its audiovisual works reflect the country's diversity and illustrates the changing cultural and social realities of Canada.

The NFB is the caretaker of a remarkable Canadian audiovisual heritage. At NFB.ca, Canadian and international audiences now have unprecedented access to audiovisual content that reflects Canadian culture and values. As a trusted provider of Canadian audiovisual content in both official languages to Canada's educational institutions, the NFB is a significant carrier of Canadian values to Canada's youth. For more information on the NFB, please visit our website at onf-nfb.gc.ca/eng/about-us/organization.php.

 

Strategic Outcome and Program Activity Architecture (PAA)

Strategic Outcome

In pursuing its mandate, the National Film Board aims to achieve the following strategic outcome:

The reflection of Canadian values and perspectives through the production of innovative Canadian audiovisual works accessible in relevant media of the day.

Program Activity Architecture

The chart below illustrates the NFB's program activities and sub-activities that contribute to the strategic outcome.²

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Summary of Performance

2009–2010 Financial Resources ($ thousands)

Planned Spending	Total Authorities	Actual Spending
65,062	70,119	69,680

 

2009–2010 Human Resources (FTEs)

Planned	Actual	Difference
452	447	-5

 

Strategic Outcome : The reflection of Canadian values and perspectives through the production of innovative Canadian audiovisual works accessible in relevant media of the day.

Performance Indicators	Targets	2009–10 Performance
Percentage of Canadian public that perceives the NFB as an innovative, creative and socially engaged institution.	60% by March 31, 2011	According to an online survey conducted on behalf of the NFB in March 2010, 62% of Canadians believe the NFB to be innovative, 75% agree that the institution is creative, while 59% felt that the NFB is socially engaged. These perceptions are similar to those found in the 2008 baseline survey. There was, however, a stronger sense in 2010 than in 2008 that the NFB is more relevant than ever in the digital environment.
Percentage of completed productions dealing with major social issues.	90% by March 31, 2011	81% of NFB productions completed in 2009-2010 dealt with major social issues.
Percentage of NFB audience who indicated that NFB productions reflect Canadian values or perspectives.	85% by March 31, 2011	According to an online survey of Canadians conducted on behalf of the NFB in March 2010, 69% of respondents feel that NFB productions are reflective of Canadian values, and associate the NFB with many core Canadian values. The number is relatively consistent from the 2008 survey results (71%)

 

($ thousands)

Program Activity	2008-2009 Actual Spending	2009-20103				Alignment to Government of Canada Outcome
		Main Estimates	Planned Spending	Total Authorities	Actual Spending
Production of Audiovisual works	45,148	45,417	45,417	48,278	47,754	Social Affairs: A Vibrant Canadian Heritage and Culture
Distribution, Accessibility & Outreach	15,090	12,150	12,150	13,516	13,814
Internal Services	7,768	7,495	7,495	8,325	8,112
Total	68,006	65,062	65,062	70,119	69,680

 

Variance explanation

The variance between the 2009–2010 planned spending and the total authorities includes funding from the Supplementary Estimates appropriation. These covered retroactive salary revisions from 2007–2008 to 2009–2010 following the signing of the collective bargaining agreements for an amount of $3.2 million; $1.2 million for severance pay and parental leave; and, the 2008–2009 carry forward of $617,000. The carry forward from 2009–2010 to 2010–2011 reached $439,000 for a total actual spending of $69.7 million.

($ thousands)

Planned Spending	65,062
Supplementary Estimates appropriation	5,057
Total Authorities	70,119
2009-2010 Carry Forward	(439)
Actual Spending	69,680

 

Contribution of Priorities to Strategic Outcome

Overall, the NFB successfully delivered on priorities identified in its 2009-2010 Report on Plans and Priorities. These are aligned with the orientations of the 2008-2013 Strategic Plan. The chart below summarizes progress achieved per priority.

Operational Priorities	Type	Status	Linkages to Strategic Outcome (SO) and Program Activities (PA)
CREATIVE LEADERSHIP AND PROGRAMMING EXCELLENCE The NFB will exercise leadership as the key reference point globally for innovation and creation, connecting with Canadians.	New	Mostly Met The programming criteria have been reviewed and are now online at the NFB's corporate site: onf-nfb.gc.ca/eng/directing-co-producing-film/ In 2009-2010, the NFB completed 112 original productions and co-productions, 9 original websites which included 140 films. The NFB has merged the Accessibility, Distribution (traditional and online), Outreach and into a single branch, which also allows it to refocus its marketing strategies.	SO: The reflection of Canadian values and perspectives through the production of innovative Canadian audiovisual works accessible in relevant media of the day. PA 1: Production of audiovisual works. This priority contributes to PA 1 and supports the SO by ensuring the production of relevant, challenging and innovative audiovisual works that give Canadians a better understanding of Canada and the world.
WIDE ACCESSIBILITY AND DEMOCRATIC ENGAGEMENT The NFB will make its works and the work of its partners readily and widely accessible to Canadian and world audiences on all relevant platforms.	New	Exceeded The NFB has implemented a digital distribution strategy targeting three major markets: the consumer market, the educational market and the content aggregators market. The educational sector strategy was revitalized by launching a Web destination for teachers at nfb.ca/education/en. The NFB has enhanced its online presence by offering 3D and HD productions and creating awareness of the programming available via its online Screening Room. It also launched its iPhone application.	SO: The reflection of Canadian values and perspectives through the production of innovative Canadian audiovisual works accessible in relevant media of the day. PA 2: Distribution, Accessibility and Outreach This priority contributes to PA 2 and supports the SO by ensuring that audiovisual works are accessible to the Canadian public in all regions.
DIGITAL TRANSFORMATION The NFB will ensure that it can deliver on its mandate into the future by continuing with the implementation of its digital strategy in programming, distribution, new business development, outreach and preservation of its audiovisual heritage. To do so, it must invest in high-definition digital production technologies, leverage new technologies and update its internal systems to capitalize on the opportunities afforded by digital production.	New	Mostly Met The NFB continued its digitization plan with the development of a digitization and archiving plan. It now offers stockshots in HD on the NFB Images site. As a result of the implementation of a minimum rights policy, the NFB can better manage intellectual property rights.	SO: The reflection of Canadian values and perspectives through the production of innovative Canadian audiovisual works accessible in relevant media of the day PA 1: The production of audiovisual works and PA 2: Distribution, Accessibility and Outreach This priority contributes to PA 1 and PA 2 and supports the SO through ongoing innovation in the production of audiovisual works and their distribution by means of all relevant channels in order to reach Canadians.

 

Management Priorities	Type	Status	Linkages to Strategic Outcome (SO) and Program Activities (PA)
ORGANIZATIONAL RENEWAL The NFB will become a model for the creative organization of the 21st century: a transparent, efficient and effective agency of the federal government, an organization that embraces ambitious environmental stewardship, values its employees and is a crucible for creative innovation. These values will extend to our industry and community partners, with whom we will work in a timely and transparent way to deliver value to Canadians, aligned with their priorities.	New	Mostly Met The NFB streamlined its organizational structure, established an Operations Committee ensuring two-way communication between the Senior Management Committee and the NFB's various divisions. It also underwent the Strategic Review. The NFB developed a risk profile. It also performed a needs analysis for an institutional training and succession plan. A sector responsible for the brand image was created to ensure that the NFB's public image is consistent. The NFB revamped its corporate site to comply with government rules regarding standardization of websites.	SO: The reflection of Canadian values and perspectives through the production of innovative Canadian audiovisual works accessible in relevant media of the day. PA 1: Production of audiovisual works PA 2: Distribution, Accessibility and Outreach This priority contributes to PA 1 and PA 2 and supports the SO by ensuring a work environment that is conducive to the creation and distribution of innovative audiovisual works that are accessible to all Canadians.
FIRM FINANCING Anchor the NFB on solid financial footing through sound budgeting, responsible fiscal management and cost-effectiveness in order to focus resources on programming and accessibility and assure the NFB can deliver on its mandate and responsibilities into the future. The NFB will also seek new sources of revenues through new distribution activities and by leveraging public and private partnerships.	New	Mostly Met The NFB continues to improve its financial planning and management mechanisms through the implementation of strict financial controls, detailed financial analyses and reviews for all expense elements and through the establishment of internal efficiency programs. The NFB focused on new revenue-generating sectors and developed partnerships in the digital media market.	SO: The reflection of Canadian values and perspectives through the production of innovative Canadian audiovisual works accessible in relevant media of the day PA 1: Production of audiovisual works PA 2: Distribution, Accessibility and Outreach This priority contributes to PA 1 and PA 2 and supports the SO by ensuring sound management of public funds and efficient use of resources.

 

Risk Analysis

Financial crisis and digital migration

The financial crisis which continues to affect the global economy will result in an acceleration of the underlying trends that are already having a profound impact on the film and television industry, i.e., the breakdown of the traditional broadcasting model and the migration to digital distribution. The NFB – like its partners in the private sector – is not immune to these realities. In 2009–2010, the NFB saw an 11% decrease in its revenues from public and private broadcasters. All markets considered, the NFB has nonetheless fared well with a 7% increase in its revenues compared to the preceding year. However, over the years, the NFB has seen its buying power diminish and is seeking to improve its efficiency by reassigning its resources and rationalizing its activities.

While we are witnessing a drop in traditional broadcasting options, business opportunities linked to technology and new consumer behaviour are on the rise. Consumer habits are rapidly changing in Canada. Additionally, consumers are using digital platforms such as the Internet and cell phones to access cultural content. According to the February 2009 comScore report, 21 million Canadians viewed over 3.1 billion videos online during that month. Young Canadians in particular are avid consumers of digital products and, in the absence of rich cultural programming featuring Canadian stories and values, they will continue to turn to foreign sources. Digital technologies can facilitate a better response to the needs of Canadian consumers and promote Canadian cultural products around the world.

The NFB, caretaker of a vast audiovisual heritage of over 13,000 titles, is expending considerable financial and human resources to digitize its collection. At present, approximately 20% of the productions created during its 70-year history risk being lost over the medium term unless they are transferred to an appropriate digital format. Added to this are the risks of obsolescence caused by rapidly evolving technologies and the increasingly complex management of intellectual property rights. In this context, technological choices must go hand in hand with meticulous analyses while rights clearance requires additional financial and human resources. Organizationally, the digital shift requires more collaborative, coherent and efficient ways of doing business.

Despite the challenges, we must bear in mind that the global digital revolution is providing the NFB with tremendous opportunities to serve Canadians by:

• reaching audiences across Canada, including remote rural areas and official language minority communities.
• reaching young Canadians via a medium that interests them, providing them with access to Canadian stories and values.

 

Expenditure Profile

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In 2009–2010, the Total Authorities include retroactive salary revision from 2007–2008 and funds for severance pay and parental leave, which are excluded in the Main Estimates. From the total Authorities, the NFB carried forward $439,000 to 2010–2011, the lowest amount in the last three years (2009 was $617,000 and 2008 was $748,000). Strict financial controls have allowed the NFB to finance investments required for the digital shift without additional funds.

In 2008–2009, NFB received $750,000 for the production of the DVD boxed set associated with the celebrations linked with the 400th anniversary of Quebec City, and funding for the last year of the Interdepartmental Partnership with the Official-Language Communities (IPOLC).

2007–2008 was the end of the Canadian Memory Fund program resulting in a reduction to NFB's planned spending in 2008–2009.

 

Voted and Statutory Items

($ thousands)

Vote # or Statutory Item (S)	Truncated Vote or Statutory Wording	2007-2008	2008-2009	2009-2010
		Actual Spending	Actual Spending	Main Estimates	Actual Spending
65	National Film Board - Program expenditures	71,167	68,006	65,062	69,680
TOTAL		71,167	68,006	65,062	69,680

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