CPCC meeting notes, obtained under Access to Information Act

CPCC meeting notes, obtained under Access to Information Act

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Canadian Music Industry Wants Government to Pay Copying Fee for Every Smartphone Sold in Canada

Last fall, months before the start of the Canadian copyright review, the Canadian Private Copying Collective, the collective that administers the tax on blank CDs that has long advocated for extending the payments to iPods and other electronic devices, met with senior officials at Canadian Heritage including Deputy Minister Graham Flack and Melanie Joly’s chief of staff Leslie Church (over two days the collective also met with politicians such as Dan Ruimy, Peter Van Loan, and Pierre Nantel). According to documents released under the Access to Information Act, the collective arrived with a startling demand, asking the federal government to pay $160 million over the next four years to compensate for music copying.

The demand, which now forms part of the platform of demands from the Canadian music industry, is based on a $40 million annual handout. While the industry has not provided details on how it arrived at its figure, notes (likely from Graham Flack) reveal the basis of the demand.

 

CPCC meeting notes, obtained under Access to Information Act

First, the industry argues that legislative reform will take too long, so rather than changing the law to apply to all smartphones and similar devices sold in Canada, it wants the government to pay what it believes would be the equivalent revenues directly out of tax revenues. Second, the source of the $40 million is revealed in the notes. The CPCC wants a copying payment for every device sold in Canada. It estimates that in Europe there is a per device copying fee of $3.50. In Canada, that would yield $40 million.

The demand is striking for several reasons. First, private copying of music has gradually diminished as Canadians gravitate to subscription services such as Spotify or ad-based streaming services that remove the need for copying. The government memo notes that “a functional, fully-licensed music streaming marketplace reduces the practice of unlicensed copying by consumers.” Second, the government also notes in the preparatory materials that private copying revenues are declining in many countries including Japan, Poland, and Portugal, which recognize the diminishing relevance of music copying in a subscription-based world.

As I wrote in a piece on the broader music industry demands, the Canadian music market is growing much faster than the world average, with Canada jumping past Australia last year to become the sixth largest music market in the world. Music collective SOCAN, a coalition member, has seen Internet streaming revenues balloon from $3.4 million in 2013 to a record-setting $49.3 million in 2017. Yet despite the success stories, the CPCC and the broader music industry wants a $160 million handout based on the premise that every device sold in Canada should have a music copying fee attached to be paid by taxpayers.

23 Comments

  1. Clearly, greed knows no limits.

    Other than trying to grab cash via consumers through the government, there is no justification for this tax. None. Zero. Nada. Zip.

    As someone who does not download or listen to music on my phone or computer, I am appalled at the demand from a group representing one industry that everyone pays into its kitty – even if the consumer does not use the product or service.

    If this is approved, then it is clear that regulators and some politicians are in the pocket of lobbyists and trade groups.

    Disgusting.

    • Disgusting and dishonest.

      How do I know they’re not going to use that money for drugs? That’s a common question that some people ask when confronted with an outstretched hand. Although I’m not one of those who would ask that question of a beggar, I do see the Canadian Private Copying Collective acting as beggars here. And in this case it is dishonest because the money will go to people who already have an income way above welfare level.

  2. Kelly Manning says:

    So this would even apply to phones issued for work? How likely is it that an employer would pay for employees to download music, video, whatever and be happy about footing the bill? Bell was particularly annoying about repeated text messages trying to persuade me to purchase music from them.

    One employer who issued me a cell phone for work purposes even monitored patterns of use outside office hours. I had to point out that the typical phone call was after hours, asking me for DB Admin, Tech Leader, or Security Admin support.

  3. As a consumer, I tend to get annoyed when it’s assumed I will become some sort of copyright pirate simply because I bought a device that theoretically could allow me to do so.

  4. Chris Brand says:

    Feels like the easiest and fairest thing would just be to legislate “private copying falls under fair dealing” and scrap the CPCC altogether. They might do better not to draw attention to themselves…

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  6. So, do Europeans pay $3.50 per device as the bureaucrat’s notes suggest? Has the sky fallen on Europe? Geist doesn’t mention this.

    • It’s funny, every time someone proposes that Canada do something different from the Europeans, Geist is rallying the troops to the barricades. Propose that we do something the same, oh! oh! the fabric of our society is in peril. Or not even that – just that every few years we might have to pay an extra $3.50 when we buy a phone or computer. The fact that Apple has more money than the government of Canada is of no concern, apparently. Or that we all pay for things we don’t use. Highways, for example, are the second largest provincial expense. I don’t own a car. I work at home. I walk everywhere. The same people who complain about high taxes and $3.50 surcharges vote Doug Ford and Donald Trump and drive around in cars in the suburbs on roads I pay for. Where’s the justice?

      • Looks like the music industry trolls are happily shilling their straw-man arguments here.

        How about this, you can’t have it both ways: either you charge all device owners a flat ‘fee’ and relinquish all legal rights to pursue copyright enforcement action against end-user infringement (because they’ve obviously licensed that use through you), or you take a step back and quit trying to muscle/lobby/bribe the politicians to legislate new revenue streams for your old school cartel that is recording record profits (see industry growth linked to above) and decades-low infringement in our new subscription-happy world where people have an easy time finding legal ways to hear the music they want.

    • They do? News to me!

      Everyone in my family have cell phones in Europe, and there’s no such charges.
      My PAYG European SIM has nothing of that nature, either.

      Conclusion: BS!!

      Oh, did I mention Canada is a laughing stock in Europe with our already completely outrageously priced cell phone plan charges?

  7. Once again, the redneck remarks are hilarious.

    Greed? No, falling artists’ income due to piracy. These sorts of tithes (like that on blank CDs, now ineffective because of other devices) are divvied up amongst artists – just the way the government pays book authors a pittance each year if their books are found in Canadian libraries. Libraries are a truly wonderful thing, but in a country like Canada, selling a book to 50 or 60 libraries doesn’t begin to cover the cost of writing and publishing it.

    Disgusting and dishonest? Disgusting is a subjective opinion. Dishonest how? And use the money for drugs? What kind of drugs have you been using to say that?

    Then there’s the argument “I don’t pirate, so why tax me? It’s called universality people. Like parents who say “don’t vaccinate my daughter at 14 years of age against HPV, she’ll never have sex before marriage.” Well, you never know. Or, guess what, I don’t have children but I pay school tax. Disgusting! I hate children! And I don’t need prescription drugs or use physiotherapy, but they’re included in my company health plan and I pay for them through my employer’s policy. Fascism!

    Who knows what people are doing with their phones. Just put a tiny across the board tax and forget about it – and worry about real problems.

    • A concerned citizen says:

      But this is completely different? The industry isn’t suffering, subscriptions as an industry work very well for how the average person who listens to music does-or they can simply stream live radio.

      This is “We want to have our cake-and have you pay us for the icing that the mean person over there” *points at a hoody on a broom stick* “is stealing from us!” *as they eat the whole cake*.

      They’ve obfuscated their industry into the ultimate middleman gig and are now seeking new ways to play the victim-even when they’ve finally found the ideal modern mechanism to ensure their product is consumed and that releasing a dud album with a single good track doesn’t take the whole product with it.

      The comparison of school taxes and highways doesn’t work though-those are PUBLIC services, to which everyone is given a right to use.

      Unless paying this fee gives Canadians ad-free subscriptions to Spotify-the comparison falls flat as it simply pads the ledgers of the big media conglomerates.

      It’s not that different from giving companies a tax break to hire more employees and grow their business to end up with them firing a good chunk of their current employees so they can give bonuses to their executives.

      • Concerned citizen with facts says:

        What you seem to miss here is that the millions that SOCAN makes aren’t millions for the content creators they are 49.3 millions / number of creators. In SOCANS case it’s 135 000 so on average creators of the content will get close to 365.185 $ per year which isn’t even a weeks pay at minimum wage. I mean what a “big cake” ! By the way the “icing” isn’t really that because users that have been using streaming services have been paying pretty close to nothing for the content and it isn’t their fault on the most part. The reason is that the streaming services that they use(mainly spotify here in the americas) give the majority of their revenue(70%) to the majors because they are owned by the majors(Warner, Sony, Universal). Even that “icing” wouldn’t really be a big sum of money for the creators. At the end of the day if we count it up it would be 160 mill / 135000 which would give 1185.185 $ + 365.185 $ = 1550.37 $ in total. Considering that artist have to hone their craft and put years into it do you think that a one time payment of 1185$ for one year with a yearly return of 365 $ is a sane equitable return for the creators ? Btw I didn’t talk about it but SOCAN takes their cut also so the amount isn’t exact, it’s lower…. Sources: http://www.socan.ca/creators/FAQs/faq-membership, https://techcrunch.com/2017/03/18/dictate-top-40/

        • The creators of the content i.e. the songwriters and artists are getting ripped off. The big corp music industry controlled by a handful of companies makes all the money. I have not studied whether this tax would filter down to the content creators but if it did I support the tax or any tax that rewards the songwriters and musicians.

  8. Bob Morris says:

    Actually, Chris, many European countries do something like that BUT they also have mandatory equipment levies

  9. Where do i apply!
    i sing all the time in my house, send me my check now i am a artist!!!

    let become all artiste,

    asking the federal government to pay $160 million over the next four years to compensate for music copying

    where this money go where the control

  10. Pingback: Canadian Music Industry Pitches 'You Must Be A Pirate' Tax On Smartphones – Miller Trades

  11. Pingback: Canadian Copyright Collective CPCC Demands a $160 Million Bailout

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  14. Any downloading of music on any device by anyone should be from a subscribed or paid for service which in turn monitors such downloads to report back to licensing agencies such as SOCAN and pays for the use. Much like the playlist reports from radio stations. This should be doable in this wonderful world of monitoring. Pay the copyright holders their due. Music is created and the creators should be paid for their efforts.

  15. Nino C Cananga says:

    You’re obviously a troll for the music industry. Anybody who hates children can’t be a very good person.

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