The big black box is your actual frame size. The grey area around this is outside the frame. I'm guessing this is a non standard clip, like something from a phone camera?
Changing the size of the canvas won't change the size of the clip. If you need the clip to fill the entire frame you have to scale it up, and you will lose a lot of clarity when you do that.
What are you trying to do - what kind of project? Could you use several pics in the same frame? Or is it more like a News thing where you need to get mobile phone footage big enough to fill the screen no matter what it looks like?