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Canadian Rules Rain on Cloud Music Parade: Why New Services Unlikely To Come To Canada Anytime Soon

The Canadian market features at least three legal issues – licensing, levies, and the lack of legal flexibility – each of which could create a significant entry barrier.

There is nothing to stop the major record labels from licensing a similar service in Canada, yet experience to date suggests it won’t happen quickly. Pandora, a popular U.S. online music service, has indicated that it wants to enter the Canadian market, but that the exorbitant licensing pricing make entry an economic impossibility. Given the current demands of multiple rights holders, the Canadian costs could keep iTunes Match out of the country for the foreseeable future.

Cloud based music services are based on users storing copies of their music on company computer servers. Since that requires additional “copies” of the music, Canadian copyright collectives will likely adopt the position that without a license, they are entitled to additional compensation for each copy. Collectives already receive compensation from radio stations for format shifting music files from CDs to computer hard drives and the Canadian Private Copying Collective (CPCC) recently announced that it is seeking to extend the private copying levy to memory cards that are widely used in digital cameras.

Cloud-based copies could be next, given that the CPCC has argued “the economic value of reproducing music in order to make it portable must be recognized. Rights holders deserve to be compensated for all private copies made of their work, regardless of how a copy is made.”

Even if the levy issue can be overcome, the lack of flexibility within the current Canadian law would create a significant barrier to the Amazon and Google cloud music services. Both of those services rely on fair use, yet Canadian law in this area is far more restrictive than the U.S. The companies would be hard pressed to argue that the Canadian fair dealing provision could be extended to cover this form of copying. The same is true for other emerging cloud-based applications, such as remote storage digital video recorders offered by some U.S. cable companies.

To open the door to these kinds of services, Canada needs Industry Minister Christian Paradis and Canadian Heritage Minister James Moore to focus on greater flexibility in the law by implementing a flexible fair dealing model or establishing a specific exception to allow for backup copies and subsequent streaming access.

69 Comments

  1. How would you put a levy on the cloud, which is theoretically ‘infinite’ or at least ever expansive. If 8GB is costed at $3 then … I can hear the wheels spinning at the CPCC.

  2. Eric Hacke says:

    Copyright is only half the problem
    On top of all the copyright-related fees prospective cloud services would have to pay in Canada, many Canadians would be hesitant to use them because of the caps and usage-based-billing imposed by most ISPs.

    Syncing an iPhone’s worth of data (16-32GB) to the cloud becomes a concern if you are on Bell’s 25GB or 50GB plan. And that ignores other large data uses like Netflix or online backup services like Carbonite.

    Viewed from a wider perspective it’s obvious that the entrenched interests of old media and telecom are doing everything possible to restrain legitimate and legal competition and innovation.

    And that doesn’t even consider the sort of technological leap forward that could occur if we radically reformed our laws to view the infinite duplicability of data and content via the internet as a feature rather than a bug.

  3. Unbelievable
    I cannot believe this is still an issue in today’s day and age. I don’t understand why there hasn’t been a successful court challenge for fair use. Maybe I’m young and naive (I’m 25), but the ability to make and store copies of the content I’ve already purchased should go without saying.

    Somewhat related, how did my parents ever get away with owning VHS machines and recording television broadcasts for viewing later?

  4. Jeff Power says:

    Dan
    ” how did my parents ever get away with owning VHS machines and recording television broadcasts for viewing later?”
    Technically in Canada this is not currently legal, but what we have is a situation where the general public believes it should be and therefor the law gets no respect. Much like the current and upcoming law on breaking digital locks.

  5. Mike Phelan says:

    Why am I not surprised. Copyright should be abolished. Let the artists and record companies toil away with the typewriter folks.

  6. Feels like Canada is being left behind when it comes to technology.
    Netflix selection and stories like this make Canada look like a bad place for consumers and business. (Unless you run an old-fashioned telco or media company).

  7. Jeff
    Do you think I can use that as a defense if/when I’m in court trying to defend my right to do whatever I want with whatever I own?

    Do I even have that right in the first place?

    And, just because I bought this CD in front of me, that doesn’t necessarily mean I OWN it does it?

    Again I wonder, and again it’s probably because I am young and naive about the law but… these issues seem pretty clear cut to me.


  8. Well, what can I say? Am I surprised? Nope…

    With licensing, levies, and the lack of legal flexibility to consider, I’ve long since given up hope on getting decent Internet and/or modern media services in Canada. Pandora is a wonderful service, that most people don’t realize used to be available in Canada until they were forced out. Currently we use it quite often over the winter months with the help of a free VPN service out of New York. Same goes for Hulu, which can easily be accessed with a simple proxy. Netflix.COM (To get access to their full library) is a little more difficult since, like most pay services, you need a US based address and credit card. But it’s certainly not impossible.

    Unfortunately, if our government, media bodies and regulators stay the current course, this is where I see Canada’s digital future going. Our younger tech-savvy generations (Say those under 40) won’t tolerate the digital “oppression” our content industry would like impose when they see the rest of the world enjoying so much more. I see a future where widespread “theft” of US-based content, much like the early days of satellite TV, is going to become common, but MUCH more difficult to detect and stop.

  9. @Dan
    “Again I wonder, and again it’s probably because I am young and naive about the law but… these issues seem pretty clear cut to me.”

    No you’re not naive, I’m 38 and of the same opinion. They’re trying to rewrite history by saying the practice they’ve allowed to become commonplace and acceptable, and often encouraged, over the past two or three generations is wrong and illegal. It simply won’t fly. Much like the Napster fiasco over a decade ago, they might make some small wins, but overall, they’re fighting a losing battle to maintain business models which no longer fit new playing field and serve to keep Canada over a decade behind the rest of the world in Internet and media development and services. All they’ll truly gain is alienation from their customers.

  10. “Rights holders deserve to be compensated for all private copies made of their work, regardless of how a copy is made.”

    No, you don’t. Greedy bastards.

  11. Google Music
    Google didn’t bother with the labels when they created their system. I’m hosting my music with them right now in Canada.

  12. Read somewhere that Pandora’s not making money in the states, and the Canadian Labels want higher rates from them?

  13. I’m not sure I understand why Canadians should care that Amazon and Google face significant barriers to implementation in Canada. Since that significant barrier is the paying of artists for the right to use their work, and since Amazon and Google are two of the richest companies in the history of time, the “significance” of the barrier is an open question, isn’t it? When Dr. Geist writes that Google and Amazone rely on fair use, what he’s really saying is that they maximize their enormous profits by not bothering to negotiate licenses with artists.

    Is it such a horrible thing for Canadian consumers to line up with Canadian artists and ask for a fair price that includes fair compensation for our cultural workers.

    Why does Dr. Geist feel it’s necessary to depict artists as the barrier to consumer nirvana, when the real barrier appears to be corporate greed.

  14. What?
    @Degen
    “Is it such a horrible thing for Canadian consumers to line up with Canadian artists and ask for a fair price that includes fair compensation for our cultural workers.”

    No it really isn’t; though you said with Canadian artists – I think Canadian consumers need to line up and make canadian artists and tyhe CPCC and the CRIA and everybody else realise that a digital copy is really only “worth” its marginal cost — less than a cent.

    If artists want to make money from their works, they should be performing; concerts are *hugely* profitable if done right and if your music is popular — if bands like the rolling stones can make over $550M on a concert tour, then surely smaller artists can make enough to scrape by if they perform on smaller tours.

    They should be releasing their music free, as a promotion for their concerts.

  15. Not overly surprised. The biggest threat to Canadian creators and their various publishers really is themselves. They specifically trying to keep it hard to the point of stupidity for people to do what they think they should be able to. They are doing their best to make themselves obsolete because they fear moving to the future where there’s a whole lot of uncertainty. It’s certainly an understandable fear, but still a fear.

    “Is it such a horrible thing for Canadian consumers to line up with Canadian artists and ask for a fair price that includes fair compensation for our cultural workers.”

    No, but there’s a limit on what is and is not reasonable. For exmaple, I should not have to pay to copy a song I bought on iTunes from my computer to my iPod. Nor should I have to pay extra for an ebook I bought to copy it from my computer to my eReader. Which really is what the whole levy thing is.

    There’s a whole new world out there Degen, one that Canadian content producers are doing their best to hide from rather than embrace.

  16. To add
    Nor should anyone really have to pay to store their music on a cloud service only they can access.

  17. @Degen,

    The issue is that, in the US, Amazon/Apple/Google are able to negotiate with the producers/creators to create a system which will be profitable for all the involved parties. Yet here in Canada, the legislative and societal morass that exists means that this same service would not be financially feasible.

    Take Pandora for instance. Reports indicated that the various rights holders wanted up to 50% of the revenue from the service, something that made no sense economically. Pandora indicated that this would have made the service exorbitantly expensive in Canada, and decided against bringing the service here.

    Who are we to blame for this? Pandora, I think not, and there’s a difference between a fair price, and outright greed from the producers/creators. They’ve set the perceived value of their product so high, that no service will even consider paying their fee, and Canadian consumers and content creators will lose out as a result, since 50% of $0 is still $0.

    In the end, the wailing and gnashing is meaningless, since there are already ways to obtain the services in Canada with no compensation going to Canadian creators (aside from those negotiated with international societies).

  18. Hallelujah .. he’s seen the light!
    @Degen “the real barrier appears to be corporate greed.”

    John, I am pleased to see you recognize the perils of corporate greed and the effect it has on the ‘little people’. I have long lamented this effect on both artists and consumers alike. Just look at the recent $50 million court case settlement that Canadian artists won against the record labels theft of their works. It seems greed breeds well in both the creative and technical realms alike.

    This is why I am such a proponent of leveraging technology and creative business models to give more control and share back to the ‘little people’. If we can bypass some of that greed (yes … from Apple & Google as well), then people can become more of their own masters and we will all be better off.

    Welcome, Padawan ;)

  19. The Cloud
    Why anyone would want any important data stored & accessed on someone else’s remote hardware is absurd, to me. If Canadian law makes it difficult, or even impossible, to have Canadian’s data (music, movies) stored on remote servers, especially servers on foreign soil (with different laws than ours), then go on ya bro. Keep your hands off the things I possess.
    Caveat : I know nothing about iCloud, beyond that is it is being pushed by a company I don’t trust. If the option *exists*, and I was forced to use iWhatever, I would only save my media stripped of any excess metadata, on my own hardware. The Cloud Gods don’t need to know what I consume, when, how often. I don’t have to endure them updating new security (theirs, not mine) schemes forcing me into applying further controls on my system(s).
    The “Cloud” is a bold move in a very wrong direction.

  20. Ki,

    Not sure who you think you’re lecturing on the state of the new world. The kind of legal device shifting you describe already exists, in my very own Canadian home. I have a Kobo e-reader. I buy one book from Kobo, and it is stored in their cloud. I access it on my iPhone, my laptop, my desktop, my e-reader, my sister-in-law’s iPad and, when I get one, my Blackberry Playbook. I’m happy with the service, and I also know that Kobo negotiated and paid for the rights for all those uses with the original owner of the book. It’s not all that hard a thing to do — artists and publishers WANT to license rights to users and intermediaries. Google and Amazon should give it a try.

    The levy is a completely different thing – a fact even Dr. Geist seems to misunderstand. Levies are used to account for transfers that are NOT covered by initial rights clearances. They are, in effect, rights clearances attached to blank media, rather than to the purchase of the content. As I’ve said in the past – levies are not a perfect solution; but they are fair within the letter and spirit of copyright law.

  21. concerned artist
    @JH Give away our music for free as a promotion? What kind of backwards idea is that? May I ask what you do for a living and would you be willing to do that job for free to show your boss just how good an employee you can be?

    Making money as a touring artist is extremely difficult even if you have a decent sized following. Transportation, lodging, food, material costs (if you’re selling merchandise), duty if you’re crossing the border, having your merchandise confiscated at a border crossing, shady promoters that don’t pay, poor attendance the list goes on, can easily stop a tour before it even starts.

    Artists have every right to receive payment for their work and it’s sad that so many people have such little respect for art in general that they think it should all be free. If you’re not willing to pay for a recording why would you pay for a live show? Most “fans” don’t go to shows in the first place.

    Having said all of that, I DO NOT agree that we should receive payment for every single copy of a work we make. Being forced to pay multiple times for the same recording is ridiculous and greedy. I think a one time payment for an album/song should allow that person the right to listen to it on any device they have.

  22. @Degen
    “Why does Dr. Geist feel it’s necessary to depict artists as the barrier to consumer nirvana, when the real barrier appears to be corporate greed.”

    Again, this is deviating from the given topic. I don’t think Geist depicts the artists as the barrier, other than perhaps a notable few such as, Metallica, Kiss and Loreena McKennit. It’s the consumer that paints the artist as the bad guy simply because it’s only the artist the end consumer cares about. Is that fair, not at all, but that’s life. Over 10 years ago, MANY years before I even heard of Geist, I switched to almost exclusively European music due to the DRM usage in Canada. Did I like “Our Lady Peace” any less? No, of course not, but their albums were DRM protected so I stopped buying them. In fact, Raine Maida has been a vocal opponent to DRM. I stopped buying Sarah McLaughlin and Loreena McKennit for the same reason. In fact, there was about 6 year period that I didn’t buy a single album from a North American artist. Even now, I still check to ensure there is no DRM when I buy an album and if I purchase on-line, I only buy content from Web stores that offer unprotected MP3 as a download option.

    The short of it, I will go without before I buy music with a digital lock.

    “When Dr. Geist writes that Google and Amazon rely on fair use, what he’s really saying is that they maximize their enormous profits by not bothering to negotiate licenses with artists.”

    This is neither a lie, nor opinion, nor endorsement. It is simply how it is. In the US, what Amazon and Google are doing is a grey area and will likely get more well defined in the near future. I see them being forced to follow a model similar to that of Apple. In any case, currently they’re not breaking any laws, and that’s what matters, right John? Or, does that only apply when it to the benefit of the content industry?

    We have stricter laws in place that protect our artists from such flagrant abuse. But are we really protecting our artists by denying consumers technology and services they so desire? How much piracy could be stemmed by offering consumers options? Netflix now accounts for the largest majority of the traffic on the Internet, a dubious position previously held pretty much exclusively by BitTorrent. Netflix is legal, paying traffic. No heavy-handed laws forced this shift. In one fowl swoop, Netflix has proven to be the single largest piracy deterrent in history, ahead of draconian laws such as HADOPI and suing people, the preferred approach of the movie industry. Hmmm…I wonder….

  23. Yes, Crockett, except you consistently err in assuming you know what I think. Have I ever been in favour of corporate greed over the rights of individuals? Um, no.

    We simply disagree, fairly consistently, on who are the giants and who the little people. You seem to think a small national collective of artists and publishers run on far less than $10 million per year (all in, legal included) is somehow far larger and more influential that a collection of universities, just one of which has a budget of $806 million, over half of which goes to salaries and benefits. I know math is not highly prized over here, but surely that one is a no-brainer (no offense).

    Greg, of the big three you mention there, it sounds like only Apple bothered to negotiate with the artists and their partners. As Geist points out, Google and Amazon rely on fair use – that’s kind of what got Google in trouble with the Books project.

    Apple will launch its cloud in Canada, just as it launched iTunes in Canada. It seems to be a company that recognizes the best way to do business is to DO business.

  24. Amen, brother …
    John, I do see difficulties with Google’s approach of offering free cloud streaming services for licensed content, as they are profiting via ad screen time. Amazon at least has some shirt tail connection as they sell the works as well, while Apple in the US has negotiated with the studios for their paid cloud service so I assume the content holders are OK with that.

    I differ a little from some of the other posters here that say copies have no value. Convenience always has some value otherwise it wouldn’t be convenient. The rub is putting an agreeable real world value on it and then finding a way to implement or manage that value. My preference would be an up front sticker price right on time of purchase. Levies, as you say, are not a perfect solution but as we move further into the digital realm I think there are going to be better solutions out there.

    The problem we face to day is, as you mentioned earlier, greed and honestly John it’s everywhere from the file sharer to the EMI & Google boardrooms. I’ll say again that the only solution I see is to empower the creator to have more control over their own marketing and distribution, only then will they get the lions share of the remuneration they deserve.

    I personally will only buy music directly from the Artists themselves, usually through their own web portal if they have it, or live. I would like to see the day were video and books could work this way as well. We will never completely loose the ‘distributor’ but we are better situated today for creators to take back control of their craft than most any time before.

  25. John, no I really don’t know what you think …
    Nor did I say you have been in favor of corporate greed, but really that is a hard truth to discern about you as I have never heard you say anything against the greed and misuses from the corporate creative sectors? Does that not concern you as well?

    There is also no need to bring Access Copyright into this discussion … Remember that soapbox problem I mentioned yesterday?

    And please accept my positions of agreement with you in the previous post as something that is sincere and not ‘faked’ so we can continue to have a real conversation.

  26. Degan – Why does Dr. Geist feel it’s necessary to depict artists as the barrier to consumer nirvana

    Actually this comes from the rights holders saying “Won’t someone think about the starving artists” Yes the “rights holders” which are usually the record label/companies that the artist sold the song rights to. That’s who is always playing the “Won’t someone think about the starving artists” It’t not the fault of the average Canadain that thats what the industry wants us to think and tries to reinforce everytime some extortion scheme is announced.

    I have about 700 cd’s with about 100 of them being bought from 1998-2001. After the Napster days which I rarely used I’ve only bought maybe 20 brand new cd’s and the rest were bought from pawn shops. You know why because the industry said “the arsists are starving” they need to be compansated so we’ll make you pay us a levy. Yup sure sure got my money for backing up my photos and burning Linux distros BUT this changed my thinking and I said fuck it I’m getting everything second hard a 1/3 the price or less. At this point of my life I could care less if there is no more commercial music as there are sites out ther like http://www.ektoplazm.com/ that I’d rather support and donate to from time to time.

  27. Well, Crockett, I have less of a middleman-as-badguy attitude than you appear to. I don’t see distributors and intermediaries as either unnecessary or inherently evil (and I have actually been involved in legal fights with publishers on behalf of writers). Bad actors are bad actors and must be challenged, but they are the exception, not the rule. There is great value added to cultural products by intermediaries, and I don’t see that going away anytime soon.

    I don’t at all disagree that artists controlling their businesses more directly is a good thing; but, again, we probably have a different idea of what that means. Artists have always controlled their businesses in one crucial way — they have owned the copyright on their work, and that copyright has been protected by law.

    Weaken or remove that reality, and your happy future of buying direct from artists will likely never happen.

  28. EG said: @JH Give away our music for free as a promotion? What kind of backwards idea is that?

    Actually since it doesn’t cost you anything to send out a music file its a great way of promoting.

    I know of several manufacturers that give away TONS of their hardware products which really cost them nothing to manufacture. Why do they do that? Market penetration. These people have average quality products at higher prices but because their name is so common because its out everywhere in the industry, they gain more from giving away products then from not.

    EG said: Making money as a touring artist is extremely difficult even if you have a decent sized following. Transportation, lodging, food, material costs (if you’re selling merchandise), duty if you’re crossing the border, having your merchandise confiscated at a border crossing, shady promoters that don’t pay, poor attendance the list goes on, can easily stop a tour before it even starts.

    So what? boo hoo working for a living is hard, well tell that to 90$ of Canadians.

    EG said: Artists have every right to receive payment for their work and it’s sad that so many people have such little respect for art in general that they think it should all be free.

    Say who? You don’t see the arhitect or a painter requesting $.01 for every person that looks at his buiulding or picture, do you?

    EG said: If you’re not willing to pay for a recording why would you pay for a live show? Most “fans” don’t go to shows in the first place.

    Actually lots of fans go to shows and the reason is that the money goes TO the artists and not to the label/record company that own the rights to the songs.

  29. IamMe,

    Google’s interpretation of fair use is not a settled point of law. If they were 100% confident in it, they would have fought the lawsuits against Google Books instead of settling. And fair use does not apply across jurisdictions, so there’s a great deal to be decided about Google’s business model and the law. If they want to sell their cloud in Canada, they should respect Canadian law.

    Who is denying Canadian consumers the services they want? There’s a market here waiting to be exploited. All these companies have to do is work with their Canadian partners and respect our laws. We ask that of any foreign company from Toyota to Siemans. If they choose not to do so, then Canadian providers need to step up and create a homegrown service. There’s a price we have to pay for protecting our unique culture. I personally do not think that price is too high.

  30. First of all John, thank you for that reply, it was very civil.
    Such discussions can only lead to better outcomes.

    @Degen “distributors and intermediaries as either unnecessary or inherently evil …”

    Neither do I see them as completely unnecessary, there will always need to be some sort of apparatus of distribution. Nor are the current ones inherently ‘evil’ but they are by human nature not wanting to give up the piece of the pie they have now, even if that would be of benefit to the artist.

    I am also not of the ‘abolish copyright’ camp, but more of the fine tune it to the times variety. Changing the flexibility of copyright is not going to necessarily weaken it … a flexible steel bar is harder to break than a ‘stronger’ one.

  31. @Degen
    Since that significant barrier is the paying of artists for the right to use their work, and “since Amazon and Google are two of the richest companies in the history of time, the “significance” of the barrier is an open question, isn’t it?”
    There are thousands of cloud services out there. It’s Canadian industry that looses out due to the ignorance of a few. Over a decade later and we’re still trying to implement the old system of compensation on a new system, and it hasn’t paid off very much for artists. Cloud services have been out for almost 12 years, and same with the expectation that consumers would be moving to these services. Markets in the media industry are predictable, it’s idiocy and ignorance of change that’s costing artists, not innovators. Intermediaries seem to still be asleep at the wheel.

  32. Crockett,

    One of the things we disagree on the most, I think, is when I am and am not being civil. I say things as I see them. Full stop.

    You’re not going to get much traction with all this talk of soapboxes and civility. I comment here and on my own blog because I think something essential is under attack by a) profound ignorance, and b) cynical ideological manipulation.

    I’m not here to feed my self-esteem or learn core truths about myself. I have many avenues for self-evaluation, and great friends who don’t let me get away with any crap.

    I’m sure you’re a good person; but, I take your praise with the same detachment I take your insults, and frankly I don’t see much difference between them. Please just stick to the facts.

  33. So much for trying …
    John I really try hard at times to find things we agree upon and give you credit where it is due. Yet amazingly after wondering here why people don’t buy into your philosophy or oppose Geist’s, you have no trouble slapping them down.

    Sheesh John, yesterday when I said you need to work on your people skills I was really only half joking but now … not so much.

    And no you have not hurt my feelings, just made my head shake.

  34. Toyota? Siemans? Really?
    Apples to oranges.

    Big, industrial players get big tax breaks and incentives to set up in Canada. In part, because they are usually high volume employers of regular blue-collar Canadians, those Canadians who buy the media, but also those most likely to use social assistance programs such as EI.

    AND, keep in mind we, as Canadians, pay HUGE hidden taxes on vehicles. Even now, with the Canadian dollar being at parity for about 2 years, give or take and prices having time to equalize, a 2011 Toyota Tacoma, manual transmission, Double Cab, with the SR5 sport package is over $10,000 more expensive here than in the US. US price is $30,277 vs. the Canadian price of $40,640.45. When it first started, before they started prohibiting American dealers to sell to Canadians, I had a friend who flew down to Montana, bought a vehicle, payed the import taxes and STILL payed more than $15,000 less than he would have here.

    In comparison, the Internet media distributors, such as Apple’s Match service, Hulu, Pandora, Netflix, (For your benefit, I’ll ignore Google and Amazon as being a bit shady), etc. require little, or no setup in Canada and can effectively operate from anywhere in the world. Unlike Industrial players, these services are hit with steep licensing and/or levy fees, as well as have to deal with onerous laws not conducive to foreign investment or competition. Add to that a relatively small population over an extremely large area, services aren’t rushing to get in to Canada. Why would they when they can look to many European countries that are more friendly to such services. On top of that, European countries generally have vastly better Internet service and much higher population density?

  35. IamMe,

    Are you disagreeing with me? I can’t tell. Canada has many unique factors that make our business environment for homegrown product quite difficult. Geist dismisses them as excuses, but you seem to have enumerated a number of facts that cannot be ignored or dismissed so easily.

    Nevertheless, we remain one of the best countries in the world in which to live. I, for one, am happy to pay for that privilege.

    Crockett,

    There are people skills, and then there are people skills. Some would say that passive agressive comments about people skills, civility and soapboxes are pretty annoying and not really conducive to dialogue. But you probably don’t need to hear that from me.

  36. @end user

    It’s convenient that you completely ignored the part of my previous post that said I do not agree with current copyright laws or the way honest and law abiding consumers foot the bill for corporate greed. You’ll also note that at no time did I complain about the amount of work that goes into making music or touring. It’s harder than you can imagine but that’s part of what makes it exciting.

    After reading your other posts I’ve realized that you’re just one of those poor folks that feels he’s being screwed by the Canadian government and record labels. That is unfortunate but has nothing to do with independent artists that have no record deal.

    It’s too bad that you feel slighted but we didn’t do it so saying that musicians don’t deserve to be paid for their work is not only unfair but ignorant. You wouldn’t work for free so why should anyone else? The cost of sending a file isn’t the problem it’s the work involved in creating that piece of work in the first place. To give you a rough idea of just how much a lot of musicians make per job I was contracted by a large retail chain to make in-store promo music. They asked for 250 pieces of original music varying in length from 5-60 seconds that they would use nation wide. They paid $3000. That boils down to $12 per song or roughly $5/hr if each song took a half hour to write (which many took more than that but we’re averaging here). Would you work for $5 an hour? So why should I?

    You obviously have no idea what you’re talking about as far as arts industries work since you’re likening them to hardware manufacturers and think painters don’t receive money based on viewings. True not all painters make money that way but many make money on traveling exhibitions as well as selling prints of their work.

    If you want to maintain your streak of what you think is defiance against an uncaring, faceless conglomerate fine, more power to you but don’t suggest that I don’t have the right to get paid for my work or that being a musician is easy.

  37. Sound Recordings in the Public Domain
    Anyone want to start a website that distributes sound recordings (a la project Gutenberg for books) for which the copyright expired? Oh? Any takers? Anyone?
    I’ve found that there is actually one such website, archive.org, look for “78 RPMs & Cylinder Recordings”. Yup. Wax Cylinders, and 78s. It’s just a matter of time before that gets taken away, too.

    The problem with the “rights holders” is that they can sit on billions worth of property without paying any kind of property tax. So what do they care? Want 70 year copyrights? Sure! 95 years? Sure! It doesn’t cost them (BigLabels) anything, so there is ZERO downside, and you never know if there’s ever any upside, but there’s for sure no downside. Just a piece of paper sitting in a box somewhere, gathering dust (kind of poetic, come to think of it; the artist turned to dust decades ago, too).

    I always advocate copyright term decrease in combination with an intellectual property tax; the first period (be it 8, 10, 20 years) is free. After that the copyright either expires, or you can extend it for another period of the same length — but for a fee. This allows “high value” property to be protected, but makes it costly to just hang on to low-to-no value property. That is why the fee needs to be sufficiently high to make sure that this happens. Even a second extension is possible, but at 100 times the fee, since the property must be more valuable than originally estimated and thus the tax needs to be reassessed. After that no extension is possible and the property becomes public domain.

    What? Public domain? Yes… you don’t hear that word a lot, do you.

  38. @Degen
    Yes, I’m disagreeing with your assertion that the likes of Toyota can be compared to something like Netflix or Pandora.

    Canada will fall all over itself to get the likes of Toyota or Siemens to set up shop here giving them all kinds of incentives and tax breaks. We have all kinds of foreign investment up in the oil field which has some of the best incentives and tax breaks in the world. Now, at the same time, Canada has so many barriers to foreign investment on the Internet service and telecom front.

    Then I go through several reasons why most decent Internet services are likely to overlook Canada for the foreseeable future. Is Netflix here to stay? Let’s see if our illustrious CRTC finds a way to legislate them out, like they did with Pandora. The SOCAN levy, if passed by the copyright board, will be a good start and open up the door for other groups to apply for similar levies, all working to keep Canada out of the modern era.

    Something truly lost on you artsy types, and I mean that in the nicest possible way…c’mon, you’re a poet, is that in order to profit from a technology, you actually have to let it in. How far behind the rest of the world does Canada have to fall before the creative industry realizes this?

    The youth today are plugged-in, they’re more technologically savvy than any other point in history. They expect instant access and have never known a world without high-speed Internet, a world without instant messaging and cell phones. How long do you think it will be before your analog bubble breaks? People will move forward with technology whether you like it or not and whether “the industry” keeps up or not. More now then ever, if one feels they’re being “oppressed” or unfairly limited on the Internet or with their electronic devices, they’re going to start looking at circumventing these measures and unlocking devices. With the exception of data caps and UBB, most protections, such as region coding, DRM, and geo-blocking are easily circumvented. If you think the silly anti-circumvention sections of C-32 are going to make a lick of difference at the civil level, I have a bridge to sell you. They will ultimately be abused at the commercial and industrial level, much like they are in the DMCA.

    “Nevertheless, we remain one of the best countries in the world in which to live. I, for one, am happy to pay for that privilege.”

    I totally agree, but being in a technical field, and one who would like to take like advantage of services like Netflix (Not Netflix-lite), Hulu and Pandora, I’m also extremely disappointed in our country for falling so far behind and imposing so many barriers without offering similar services. It truly is shameful.

  39. Sigh, Dialogue?
    @Degen “Some would say that passive agressive comments about people skills, civility and soapboxes are pretty annoying and not really conducive to dialogue.”

    Dialouge? Really??

    John, I really do wish you would care more to dialogue than lecture. Your discursiveness instead often leads away from the topic at hand and then (as annoying as you think the term) out comes your Geist soapbox. We can assume just from repetition ad nauseam that anything Geist says will automatically be vexatious to you, so why bother?

    Really I wonder if discourse is even a value you intend to exercise here as you don’t seem to value any opinion but your own.

    If agreeing with your valid points and talk of civility in discussions is offensive to you then so be it. But if expecting to be effective in changing minds or attitudes is your goal then I should not hope for much success.

    The old adage of reaping and sowing has age old meaning for a reason.

  40. @end user

    It’s a shame that you feel slighted by record labels and the Canadian government but indie artists with no ties to labels aren’t the people making money from these arrangements.

    I deserve to be paid for my work just like anyone else but it’s convenient that you left the part of my post where I say that I’m against current copyright law out. You’ll also note that at no time did I complain about the amount of work that goes into touring.

    You obviously have a problem with a group that you perceive as a faceless conglomerate secretly plotting to steal your hard earned money through hidden fees on consumer goods. I’ve got news for you, most of us don’t benefit from that. Just because we’ve manufactured a cd doesn’t mean a label was involved and all the money we’ve put into our recordings comes back to us when/if we sell them. The shows that small bands play don’t work the same way large tours do. We don’t always sell tickets ahead of time and might only make scale depending on the room and union rules. Nothing says big time rock and roll like splitting $300 between four band members, sleeping on a floor then driving ten hours to the next town. The actual money bands make on tour is from merchandise. T-shirts, stickers and yes, albums sold on tour put gas in the tank and food in stomachs. If we’re lucky we have enough to pay for rent when we get home.

    Perhaps you should learn a little more about the industry before you start suggesting that musicians are lazy cry babies that agree with current copyright laws because we’re all getting rich off of cd-r tariffs and therefore do not deserve to be paid for our hard work.

  41. …also…
    “Canada has many unique factors that make our business environment for homegrown product quite difficult.”

    If this is the case, then why make it so difficult for well established foreign investors? Say as Netflix, Pandora, Hulu etc. as well as in the telecom, ISP and cellular areas?

    It’s like a child who throws his favorite toy off a bridge because his mother says he has to share it… It’s the “If I can’t have it, then no one’s going to have it” mentality. So if can’t provide it locally, we’re simply going to make it difficult for others to provide it, with low data caps, excessive licensing, fees and rules.

    It’s time for Canada to grow up.

  42. Welcome!
    EG,

    I for one am a great supporter of artists, I only buy my music directly from the performers, as often is possible. I do not think artists have it easy (have they ever?), and yes like anyone else they should be compensated to the level of their talent.

    I also think a large number of artists are being ‘picked clean’ by those who live off their talent, and yes this includes the file sharers, but also the professionals who say they work for your interests. These same entities are doing their best to maintain their share of the pie at the expense of exploring more efficient methods for your remuneration. In the process their tactics are turning people off to the point of not caring for your plight, pushing people to use infringing or ‘geo-unlocked’ services that lead to nothing for you.

    My hope and main drive in these discussions is to encourage artists to be creative not just in their art but also in their marketing. There are many new and upcoming methods to think outside the box, signing over your rights to the old methods may be the easy or expedient path but for most, not the best.

    I appreciate you posting here, and yes I did notice your disagreements with the company ‘label’ lines. Please continue to offer your opinion as so often what we get here is the ‘upper management’ view. Some more stories from the front lines would be great.

  43. ‘geo-unlocked’ services
    Is geo-unlocking technically illegal? For who? Is it illegal for me? Or illegal for the VPN provider I use? I don’t know. Call it infringing if you will, but using Pandora has led me several bands I would otherwise not have heard of. Bands I have subsequently purchased albums from that I would have otherwise not purchased, so where does that leave me?

    Pandora is only infringing as far as the CTRC is concerned, I don’t see it that way and see most of the Canadian regulations as arcane and out of touch with reality and C-32 is just as bad.

    Likewise, using Youtube, which has lot’s of geo-blocked content, to search out music, has led me to dozens of bands I’ve never heard of from which I’ve bought many albums. Again, much of this content on Youtube is technically illegal. Should it be? Is it truly uncompensated usage?

  44. @EG
    “Just because we’ve manufactured a cd doesn’t mean a label was involved and all the money we’ve put into our recordings comes back to us when/if we sell them.”

    Any independent artist manufacturing CD’s or releasing CD’s in this day an age, are idiots. The age of the CD is over.

    Traditionally most indie artists live the life you are describing even when this industry was booming in the 90′s. This is why most of them also have second jobs to pay for their rent. I don’t know any indie band that hasn’t slept on floors, had trouble paying rent, and made the bulk of their money through other means rather than recorded music. This is usually where the band starts to explore their creativity and identity.

    “Perhaps you should learn a little more about the industry before you start suggesting that musicians are lazy cry babies that agree with current copyright laws because we’re all getting rich off of cd-r tariffs and therefore do not deserve to be paid for our hard work.”

    First off I agree with the cd-r tariffs. Musicians get pennies if that for those tariffs even the indie artists. As someone who has worked in the industry before, your statements about the life you live as an indie band suggests that SOME musicians are lazy cry babies, while others suck it up, and find their way to break through using their creativity in a highly competitive field.

  45. @Degen
    “Not sure who you think you’re lecturing on the state of the new world.”

    Canadian content providers and the people who make it hard to impossible for new types of business to move into the country via (ultimately protective) rules that they seem more than content to use to make sure things don’t come here. Whether that’s the artists themselves and/or whoever owns the rights to the work in question.

    And it’s not so much a lecture as an observation based on what I’ve seen.

  46. @EG
    I said: “First off I agree with the cd-r tariffs.”

    Clearification: I agree with what you are saying about the tariffs. I do not agree by any means that this current system of tariffs is working for musicians, nor do I beleive that by expanding this failed approach to other media will have any significant impact either.

  47. As Jsson K would say – clearification:

    Ki,

    How have Canadian writers made it impossible for new types of business when they have entered into agreements with Kobo to make the very cloud-based format shifting Geist predicts will never happen, happen?

    Crockett,

    I don’t expect to change any minds over here, since it’s quite clear to me from years of observation that this is the realm of true believers. You have many soft words for me and others like EG when you sense a possible hook, but you’re also very happy to throw out the standard “lobbyist,” anti-creator rhetoric when the spirit moves you. I’m here to create pause, and to let the casual observer know not everyone who reads Geist has taken the Kool-Aid.

    I suspect we would not disagree about many other things, but the idea that change will come through discussion on THIS blog is ridiculous to me.

    Start your own blog. You don’t need Geist. No-one does. If this discussion is to move forward at all, it has to move away from here.

  48. Refreshing guileless …
    Well John, that at least lays it out plain and honestly, for that thank you.

    I do not agree with everything Geist postulates yet also I don’t think he’s as write off-able as you wish. On that point we’ll just have to agree to disagree and leave it at that.

  49. John to be fair I do not consider myself to be ‘anti-creator’ at all. I have always sought solutions leading to a better deal for creators and consumers both, I for one do not think they need be mutually exclusive. You may paint me naive in that respect if you wish, but my motivation & conscience is clear.

  50. If I pay for my CD or download, I can and will format shift any way I desire. The rights holders already got paid. They do not deserve no cent more. Period.

  51. Stephen M says:

    Value added levy?
    AT one point, blank tapes had an additional levy because it was assumed they would be used to copy music.

    CDs (or from whatever medium music is bought) could be “taxed” an additional amount to assume it will be ripped/copied or otherwise transported to another device, especially by the same owner. If they price themselves out of the market at that point, well, no wonder piracy thrives.

  52. @Degen
    Please point out where I specifically talked about writers and only writers? Cause I’m sure I didn’t.

  53. Ki,

    Of course, you didn’t. I was giving you one example of “Canadian content providers” who have NOT made it hard or impossible for new businesses to flourish in this country. Do you deny that Kobo is an excellent example of how new tech businesses can work extremely well with Canadian customers and creators both? If you’d like, I can add to the list – how about music artists and labels who have made agreements with iTunes? These examples are models for how businesses should treat the Canadian market.

    The idea that content providers – in this case artists and their industry partners, want to lock businesses out of Canada – businesses that would ultimately sell more of their works – is absurd. What they want is a negotiated fair price and not wholesale appropriation (under the banner of fair use). They want to be part of the revenue stream, because it’s their right to be part of it. Why is that so hard to understand.

    It’s not all about convenience for the consumer. There are others in the equation as well.

  54. @Degen
    That one example doesn’t really change my opinion on the general overall Canadian content providers. Same with iTunes, since iTunes isn’t a service like NetFlix so much as an online store front. And i do know that the basic goal isn’t to keep people out, but they don’t exactly make it easy or affordable for people to offer those type of services here. Cause if they actually did, I would probably have more selection on NetFlix Canada than I do now.

    There’s making money, and then there’s remaining relevant. On the whole, I see very little effort to try and remain relevant. This includes the various fights over copyright in the country. Does that mean that I expect them to not try to make money? No, that would be stupid. But at some point they need to realize that making it hard for things to move here by making it prohibitively expensive for the market size we have here is just going to make people go completely around them.

  55. Ki,

    Well, on that we disagree. I think it’s always crucially important for suppliers to demand the best price for their work. I’m not sure how one remains relevant by letting others walk all over them and take their money and their rights.

    Oh, and thanks for the other example – Netflix Canada. Despite predicitions that they wouldn’t be able to open up shop here, they have and they seem to be doing quite well. Clearly, no example of this stuff working is going to be good enough for you, but they sure do show me that respecting Canadian rules and suppliers continues to be a reasonable request within the Canadian market.

  56. The economic value of reproducing music to make it portable is recognized.. It’s how they are the ones that create this value (when it’s other people doing all the work finding new uses for stuff they made ages ago) that is a total mystery,

  57. @Degan
    And suppliers can demand what they want, but if no ones willing to pay it, then they don’t make anything either. Reasonable price for the Canadian market may just make the Canadian market irrelevant in a world where the borders on what people can and can’t get are a lot less defined.

    And while NetFlix is somewhat an example, they don’t have the selection here they do in the US and some of the newer things are still hard to find. I am still half considering going around geolocking to get the US one which has more stuff), but part of me hopes I don’t need to. If NetFlix ends up leaving, I will be doing that. I dp offer Pandora as a counter example though. This is essentially the same thing as NetFlix, but for music, and they say it costs too much to operate here. So no, I still don’t see a huge embrace of new services from different Canadian content providers. But who knows, maybe the future might actually get them to.

  58. Ki said: So no, I still don’t see a huge embrace of new services from different Canadian content providers.

    Don’t look too hard. Its beenshown its easier to legislate and introduce tariffs to maintian cash flow then it is to actually offer Canadian proper streaming/on demand services.

    The technology has been around since 1999 when shoutcast became really popular yet no Canadian media conglomarate has had the vision to start offering Canadian on demand cheap content. They are stuck in the CD price LA-LA land and will not move forward.

    Oh well back to paying nothing for second had cd’s and dvd’s while supporting local small businesses and screwing the rights holders.

  59. @Degen
    Kobo and Netflix…well Netflix-lite, are two examples. As for Kobo, e-books is a much smaller market don’t seem to have as many barriers as mainstream media. Yes, Netflix is here, but it’s only a shadow of what it is in the US. The same goes for many of the digital media stores. Get yourself a proxy and compare content of the US counterparts. It shocking how much we’re not getting. Where are the Canadian-based services, that are NOT part of the telecom oligopoly? You say, suppliers should demand the best price, but at what point does that price become gouging? Netflix proves it can be extremely profitable both as a company and for studios at a drastically reduced price. At the same time it provides a service which has been proven to be an effective piracy deterrent. It’s a winning situation for all those involved.

    High end bicycles, for instance, only have about a 30% markup. After the cost of producing the recording, digital media is infinitely copyable and costs nearly nothing to deliver. No more mass replication plants, not more purchase of raw materials, no more shipping to retail locations or storage facilities. At $10 – $15 to download an album, the markup is in the hundreds or even 1000′s of percent. The same goes for the cost of our Internet service and cell service. Again, at what point does it become gouging.

    Still, you only site 2 examples, among dozens, or hundreds available in the US and Netflix is really the ONLY service of it’s type available in Canada.

  60. IamMe,

    Your calculation of the value of digital music completely discounts the value of the intellectual property – the creation of the work itself. Delivery is not the only part of this equation. You have to account for creation. The closer to zero you push the price by focusing only on delivery, the lower the value you place on creation, to the point where it has no value whatsoever. And yet aggregators like Google make gazillions selling advertising around this “valueless” content.

    I’m sorry, but I don’t buy into the digital shell game. Creation has clear and obvious value, and we need to maintain economic mechanisms to pay for it.

  61. The cloud? lol Just stream from your own rig via foobar. Why pay money for something you can get for free, eh?

  62. @Degen
    “Your calculation of the value of digital music completely discounts the value of the intellectual property”

    Really? But what is the value of the IP then? Give me a number I can chew on…when I can go to Walmart and buy a CD for less than I can download the same album? The very same CD that has all the production and shipping overhead costs that the digital copy does not have. The same overhead costs the recording industry told us for years was the primary reason the cost of the CD has never come down. If I can buy a physical CD for less than I can download it on line then there is something wrong with the pricing model, we’re being gouged on digital downloads, period.

  63. artists feel entitled…
    @EG

    “Give away our music for free as a promotion? What kind of backwards idea is that? May I ask what you do for a living and would you be willing to do that job for free to show your boss just how good an employee you can be?”

    Giving away something that costs nothing to make, in order to lure people to something that makes real money is a corner stone of marketing. I don’t think it’s much of a job to put a file into a sharing directory, or to upload it on to youtube. I could do that for you for free easily enough. The actual *work* is the performance; which you can get paid for by having a concert… Should an artist be able to spend 20 minutes on a recording session, and make money off of that for the rest of their lives? I only get paid when I actually work, why should artists get paid for dong nothing; if they’re performing, they deserve to get paid, otherwise i’d say not.

    “Making money as a touring artist is extremely difficult even if you have a decent sized following. Transportation, lodging, food, material costs (if you’re selling merchandise), duty if you’re crossing the border, having your merchandise confiscated at a border crossing, shady promoters that don’t pay, poor attendance the list goes on, can easily stop a tour before it even starts.”

    Right; nobody said working for a living was easy; that’s why artists shouldn’t consider making music as their “living” until they are successful; hold down a primary job, and do the music & etc on the side, until they’re good enough / popular enough to have at it alone.

    “Artists have every right to receive payment for their work and it’s sad that so many people have such little respect for art in general that they think it should all be free. If you’re not willing to pay for a recording why would you pay for a live show? Most “fans” don’t go to shows in the first place.”

    Why would I pay for a live show? because live shows are fun, and there isn’t an infinite supply of them. A recording of a typical song, however, I can make 3 million copies of on my computer in about 10 minutes; it costs me nothing, is it worth $3 million though?


  64. JH said: “Why would I pay for a live show? because live shows are fun, and there isn’t an infinite supply of them. A recording of a typical song, however, I can make 3 million copies of on my computer in about 10 minutes; it costs me nothing, is it worth $3 million though?”

    I don’t mind paying for media…once, and at fair market value, but as I noted just a couple posting above, what that value is, is a matter of contention as of late.

  65. Degen said:Your calculation of the value of digital music completely discounts the value of the intellectual property – the creation of the work itself.

    Really how is buying a digital song and then selling to a friend while deleting my digital file different then buying a cd then selling it to a friend?

    Now if you come back with oh but how do we know you deleted that file, well you don’t, just like you don’t know if I made a copy of that cd before I sold it to my buddy.

    The notion that the artist needs to be compensate for 50 years for creating the song is rediculous. This is like saying an architect should be paid for a house plan every time the house is sold. After all he needs to be compensated for the act of designing the house.

    Degen said:Creation has clear and obvious value, and we need to maintain economic mechanisms to pay for it.

    No no you’re only talking about music which is BS. Now if you stood your ground and said Ford needs to be compensated for the deisign of their truck every time a F-150 is sold then I’d take you a bit more seriously but you’re one sided and only talk about music/books/written work.

  66. end user
    Ford does get paid every time a f-150 is sold. They build them.

    Of course Ford doesn’t get anything if you resell your truck, that’s just silly. Ford also doesn’t tell you what roads you can drive in, or ask for more money when you drive on a new road. Ford doesn’t tell you who can get into your truck, or charge you more for each person. Ford doesn’t require you to give full control of your garage over to them, and require you to ask them for permission/pay them again before you use your garage, just because it may be used in a way they don’t like. Ford doesn’t require you to pay them every time you make money using your truck.

    But you’ll never hear the IP extremist offer to pay for those ‘uses’ of property. No the comparison between physical object purchased and “IP” is only to be used when it benefits “IP” owners.

  67. Unwritten says:


    @Degen

    ‘One of the things we disagree on the most, I think, is when I am and am not being civil. I say things as I see them. Full stop.’

    Therefore, everything is his opinion and facts optional.

    ‘You’re not going to get much traction with all this talk of soapboxes and civility.’

    Quite right! He’s here to rant and hopefully discredit someone, not be polite and provide a reasonable counterpoint to Prof. Geist.

    ‘I comment here and on my own blog because I think something essential is under attack by a) profound ignorance, and b) cynical ideological manipulation.’

    What the ‘something essential’ is even he doesn’t seem to know–and is he talking about Geist or, unconsciously, himself? Many reading his many, many entries here on this blog would think both points could be applied to Degen though I lean towards b) more.

    ‘I’m not here to feed my self-esteem or learn core truths about myself.’

    The latter, sir, is obvious but the former I would disagree with.

    ‘I have many avenues for self-evaluation, and great friends who don’t let me get away with any crap.’

    Neither of which appear to be present in this blog–as you claim everyone else here are ‘followers of Dr. Ev… er.. Prof. Geist’–and so you are free to get away with your self-described ‘crap’.

    ‘I’m sure you’re a good person…’

    See? He says Crockett is good and Crockett is a ‘follower’. Since all ‘followers’ are the same then everyone else in this blog is good. Except… well… ahem.

    ‘..but, I take your praise with the same detachment I take your insults,’

    Since disagreeing with him is an insult, agreeing with him is just plain WRONG.
    Logic, get thee hence!

    ‘..and frankly I don’t see much difference between them.’

    Not that there might be any reason for that….

    ‘Please just stick to the facts.’

    I’m sure he’d love to. However, opinion, which you provide plenty of, is not facts.
    Hard facts, if you have any, I’m sure the readers of this blog would love to read about.

    Quite frankly, _I_ would love to hear a clear headed, civil opposition in this blog that is lacking Degen’s characteristic and sensationalistic entries. Your constant put downs of Prof. Geist and predictable misdirections away from direct questions is tiring at best and approaching slander at worst. I’m amazed and humbled at the patience the regulars have in putting up with such an obvious troll.

    I bow to you, Crockett.

  68. Might want to view this comment from CPCC…
    http://www.musicpublishercanada.ca/2011/06/22/canadian-private-copying-collective-cpcc-sees-no-levy-on-cloud-based-music-services/

    If these services do not enter Canada, this is just an excuse…