As a big movie fan, I have strong opinions about movies (as well as almost everything else :-).
Canadians watch mostly Hollywood movies for the same reason that Americans do - they are fun. Genuine Canadian movies (as opposed to American movies filmed in Canada) resemble American independent films more than Hollywood productions. They are often very well written and well acted, but lack expensive production values, tend to be overly preachy, and incorporate subtleties that bypass the mainstream audience (and often bypass me as well). In a word, they are boring. You can always identify a Canadian movie within less than a minute just by listening for background music. Most Canadian movies have almost none.
Canada has worked hard to build a strong movie industry here, but the result has backfired. You have seen a great many Canadian movies and television shows, but you thought that they were American because they were Hollywood productions. American stars perform American scripts in front of American street signs that have been bolted to Canadian buildings. More often than you realize, those movies set in New York or Chicago are being filmed on the streets of Vancouver, Toronto, and Montreal. Rather than building an indigenous Canadian movie industry, we have only succeeded in moving a big chunk of the American movie industry north. And we have been so successful at that, that the American film trade unions have staged protests complaining about Canadian competition.
We had hoped that the expertise that was being developed in Canada would trickle down to indigenous Canadian films. For the most part, that has not worked. The best Canadian stars, writers, and directors get noticed by Hollywood and move across the border.
The other half of the equation is film distribution. Thatīs where Canada loses big time. Canadian theaters are controlled by American distributors. They require that Canadian theaters screen American films by imposing quotas that say, in effect, "You canīt show a mixture of Canadian and American films. If you donīt fill your screens with our movies weīll freeze you out of showing any Hollywood films and bankrupt you." A great many Canadian films are forced directly to video, even if they would have found a reasonable theatrical audience.
The Government of Canada built the modern Canadian music industry with "Canadian Content Rules" that require that radio stations to broadcast at least 30% Canadian music. They cannot enforce the same rules in movie theaters because movie theaters will go bankrupt - most of the time, their audience wants to see expensive American productions. I know of at least one case where a Canadian film producer leased a screen in a commercial theater for a week because that was the only way that he could get his own film screened. Maybe the National Film Board of Canada should set up subsidized theaters that only show Canadian films in "virtual theatres" by leasing screens from multiplexes as required. The only problem with that approach is that too many voters would yell about the government wasting money and interfering in private industry again.