3.2 Lack of Capital to Exploit Intellectual Property (IP)

Canadians have significant talent and compelling stories to tell, and should therefore be able to compete at with foreign content at home as well as in global markets. However, many cultural producers in Canada are undercapitalized; they are often compelled to sell their IP rights just to get their products made. Many are not in a position to retain and exploit their IP rights by earning revenues from foreign markets and other digital platforms. In the convergent world of media, where a feature film can quickly become an online game or an electronically distributed book property, ownership of these ancillary rights is increasingly important.

A national digital strategy should recognize and address this financial predicament, and start re-orienting incentive systems to develop companies that can develop and grow the IP rights that they create. Current support mechanisms tend to drive the creation, production, and distribution of content – as well as employment in doing so. Though there is recognition of the need to support content production companies engaged in creating, producing, and distributing content, most of the support incentives are primarily aimed at projects not the growth of companies. A national digital strategy that considers the importance of content development needs to take a fresh and more comprehensive look at the various support programs for the cultural sector. It should address how to facilitate changes in these measures that will support sustainable companies rather than simply content creation for established distribution channels.

The ability to develop and exploit one’s own IP on globally will help to define Canada’s comparative advantage. Thus, a national digital strategy should address this issue through a review of the support systems for Canadian content. Such a review should look for incentives designed to encourage Canadians to invest in their IP, and so gain the fruits of its exploitation in foreign markets and other digital platforms.