Canadianizing the Press

One of the great rallying cries of Prime Minister John Diefenbaker's Tory government is Canadianization. Seeking to build a specific Canadian identity in the shadow of its overpowering U.S. neighbor, Diefenbaker has called for Canadianization of industry, of investment, of natural resources. Last week Canadianization was applied to a new area: the press. In a 263-page report, a Royal Commission set up by the government nine months ago recommended strict penalties against "foreign" magazines sold in Canada. Said the Commission: "Only a truly Canadian printing press, one with the 'feel' of Canada and directly responsible to Canada, can give us the critical analysis, the informed discourse and dialogue which are indispensable in a sovereign society."

The three-man Commission* expressed its impatience with "venerable and sanctified cliches about 'press freedom' shouted at the Commission through so many of its hearings," protested that it had no "desire to create a protected haven or storm shelter for Canadian periodicals, and least of all a sanctuary for mediocrity." It declared "that a Canadian periodical press given to a narrow, bigoted nationalism would not be worth salvation." But in its proposals to end the "unfair" threat from the U.S. periodicals that comprise 75% of the magazines Canada reads, the Commission made recommendations that the Winnipeg Free Press described as "discriminatory, protectionist and narrowly nationalistic." Items:

P: ADVERTISING by Canadian companies should be restricted to Canadian periodicals. Tax laws should be changed so that Canadian advertisers would no longer be allowed to deduct from their income tax as a business expense the cost of advertising directed at Canadian readers in a foreign-owned periodical "wherever printed." The effect: to "approximately double" the cost of advertising in U.S.-produced magazines aimed at the Canadian market. The Commission urged that the customs laws should also be rewritten to prohibit importing any magazine unless it contained "no advertising which on its face indicates the availability of a product or service in Canada."

P:OWNERSHIP of magazines with Canadian advertising must be Canadian. No magazine must be a licensee of or "otherwise substantially the same as a periodical owned or controlled outside Canada."

P: PROMOTION provisions should be sharply changed so that U.S. publishers could not send in business reply cards and other subscription devices, and postal regulations on foreign second-class mail should be tightened in Canada's favor.

The Commission made abundantly clear that it was out in particular after TIME and the Reader's Digest, both of which publish special editions for Canadian readers. Though TIME offers no direct competition to any Canadian periodical ("The Canadian market is probably too small for such a development," agreed the Commission), it and the Digest have been growing rapidly in circulation and advertising, while purely Canadian magazines show a much slower growth. TIME, with a circulation of 245,000, grew 77% in circulation, 208% in ad revenues in eight years. The Reader's Digest, with a monthly circulation of 1,070,000, grew 48% in circulation, 194% in ad revenue during the same period. By contrast, say the commissioners, a list of ten "leading Canadian consumer magazines" grew only 20% in circulation, 57% in ad revenues.

The report also hits such magazines as the Saturday Evening Post, McCall's and Look, which, though they do not have special Canadian editions, sell split-run advertising in magazines exported to Canada. Conclusion: "The newsstands are dominated by American publications which, with their greater bulk and more expensive appearance, overpower as well as outnumber the native product."

The Commission's report is buttressed by intriguing statistics about the state of the Canadian magazine business and of the difficulties encountered by small cultural magazines. The Commission proposed free mailing privileges for 5,000 copies per issue of nonprofit, cultural and little magazines. It said that of 287 Canadian periodicals published since 1920, no fewer than 211 have given up. Only five survive as major English-language consumer magazines, and three of these (Maclean's, Canadian Homes and Chatelaine) are run by Toronto's Maclean-Hunter Publishing Co., Ltd., which commands 59% of the circulation and 78% of the advertising revenue spent in Canadian magazines.

Maclean-Hunter President Floyd Chalmers, who says he expects to lose a million dollars this year on his magazines, hailed the report. Since he "freely admitted," said Royal Commissioner Johnston, that Maclean-Hunter hoped to get "a substantial part" of the $8,000,000 or $9,000,000 a year that would be taken away from U.S. periodicals, "the Commission was concerned lest a recommendation for improving the climate for Canadian periodical publishing could be construed as a recommendation mainly for the benefit of this one large and successful company." The Commission seemed to have found no answer to this worry.

It also raised, but did not answer, the question whether advertisers might prefer to divert their money "to competing media--radio, television, newspapers" rather than to support Canada's hard-pressed magazines. Ad revenues on TV, according to the Commission, have doubled to $27.3 million since 1955.

As was to be expected, the head of Canada's Periodical Press Association cheered the report, as did the Toronto Star and the Montreal Star, who could expect to gain ad revenue for their weekend publications. But there were vigorous dissents: "Give this report the ax," snapped the Tory Toronto Telegram.* Said the Calgary Herald: "To punish advertisers for wanting to use media promising the best returns is not the way to go about it in a free enterprise society. If Canadian publications do not enjoy the large circulations other publications are able to command, the obvious thing for them to do is to improve their quality."

Submitting the report to the Commons, Prime Minister Diefenbaker said only: "The government is giving careful study to the recommendations in the light of its objectives to foster a sound and strong Canadianism."

* Headed by Ottawa Journal President and Edftor M. Grattan O'Leary, 71. His fellow commissioners: Toronto Public Relations Man John George Johnston and Montrealer Claude Beaubien, vice president for advertising of the Aluminum Co. of Canada.* For TIME'S view, see A LETTER FROM THE PUBLISHER.

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