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An Inside Facebook
report on declining active Facebook users has attracted considerable
media
attention
as it pointed to lower numbers in the U.S., Canada, and the U.K. While
Facebook has disputed
the report,
it should be noted that the Canadian data suggests a far more
significant decline in Canada as compared to the other countries.
The
Inside Facebook report says the U.S. decline of 6 million active users
is the most prominent, but it represents roughly 3.8% of its user base.
By comparison, the Canadian decline of 1.5 million users is roughly
8.2%, far larger than the U.S. or any of the other countries posting
declines.
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Apple has once again captured the attention of the Internet world with
the unveiling of the iCloud, an online backup system that will allow
users to instantly store their content on Apple computer servers so
that they can be accessed anywhere from any device.
The most notable element of the iCloud is the iTunes Match service that
gives users cloud-based access to their full digital music libraries.
This includes songs purchased on iTunes as well as any other music
files, which will be identified by Apple and made available without the
need to upload the copy. Itunes Match has obtained the blessing of the
major record labels, who will reportedly receive the lion's share of
the service's US$24.95 annual fee.
The Apple announcement comes on the heels of newly launched music cloud
services from Internet giants Amazon and Google. The Amazon Cloud
Player allow users to upload their own music to Amazon's computer
servers and to stream it to any device, while Music Beta by Google
similarly involves uploading music files for streaming access. Neither
Amazon nor Google obtained licenses for their services, relying instead
on their users' fair use rights to shift their music to the "cloud."
While the licensing approaches differentiate Apple from its
competitors, my weekly technology law column (Toronto
Star version, homepage
version) argues all three cloud music services share a common
characteristic when it comes to Canada - none are likely to be
available here anytime soon.
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Appeared
in the Toronto Star on June 12, 2011 as Forecast Iffy for Music Cloud
Services in Canada
Apple has once again captured the attention of the Internet world with
the unveiling of the iCloud, an online backup system that will allow
users to instantly store their content on Apple computer servers so
that they can be accessed anywhere from any device.
The most notable element of the iCloud is the iTunes Match service that
gives users cloud-based access to their full digital music libraries.
This includes songs purchased on iTunes as well as any other music
files, which will be identified by Apple and made available without the
need to upload the copy. Itunes Match has obtained the blessing of the
major record labels, who will reportedly receive the lion's share of
the service's US$24.95 annual fee.
The Apple announcement comes on the heels of newly launched music cloud
services from Internet giants Amazon and Google. The Amazon Cloud
Player allow users to upload their own music to Amazon's computer
servers and to stream it to any device, while Music Beta by Google
similarly involves uploading music files for streaming access. Neither
Amazon nor Google obtained licenses for their services, relying instead
on their users' fair use rights to shift their music to the "cloud."
While the licensing approaches differentiate Apple from its
competitors, all three cloud music services share a common
characteristic when it comes to Canada - none are likely to be
available here 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.
Michael Geist holds the Canada
Research Chair in Internet and E-commerce Law at the University of
Ottawa, Faculty of Law. He can reached at mgeist@uottawa.ca or online
at www.michaelgeist.ca.
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