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Canadian Music Industry Takes Aim At Google, Facebook, Reddit & Tech Startups With Bill C-11 Demands

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Wednesday February 29, 2012
The steady procession of Canadian music industry representatives to the Bill C-11 committee continues today with the Canadian Independent Music Association (CIMA) ready to add to an already long list of industry demands to completely overhaul the bill. The music industry demands keep growing, but CIMA's list is the most radical to date as it would create liability risk for social networking sites, search engines, blogging platforms, video sites, aggregators, and many other websites featuring third party contributions. If that were not enough, the industry is also calling for a new iPod tax, an extension in the term of copyright, a removal of protections for user generated content, parody, and satire, as well as an increase in statutory damage awards. Taken together, the music industry demands make SOPA look like some minor tinkering with the law.

Note that industry had already called for SOPA-style reforms such as website blocking and expanded liability that could extend to sites such as YouTube before the hearings began. This week has seen an industry lawyer inaccurately portray global approaches to digital lock rules and a musician association demand full statutory damages of up to $20,000 per infringement for non-commercial infringements by individuals.

Those demands are nothing compared to what CIMA has in mind, however. Topping the list is a massive expansion of the enabler provision. The music industry wants to remove a requirement that the so-called pirate sites be "designed primarily" to enable copyright infringement. It states:

The phrase, 'designed primarily to enable acts of copyright infringement' does leave the definition open to broad interpretation, and as such CIMA fears it will be used by those who purposely and wilfully engage in copyright infringement as a means to avoid legal prosecution. In addition, a website that is “designed primarily” for selling smart phones, for example, could be enabling the download of music but would not be considered in violation of the new Act, under Bill C‐11. We encourage the government to amend this section of the Bill to in order to remove any and all vagaries in the language, in part by removing the phrasing 'designed primarily.'

Should the government grant the music industry's request, the amended provision would read:

It is an infringement of copyright for a person to provide, by means of the Internet or another digital network, a service that the person knows or should have known enables acts of copyright infringement if an actual infringement of copyright occurs by means of the Internet or another digital network as a result of the use of that service.

There is virtually no limit to prima facie liability under this provision as most sites can be said to enable some infringement, particularly if they allow for users to post or interact with the site. This includes sites like Google, Facebook, Reddit, and Youtube. All of these sites - indeed virtually any blogging platform, social network, search engine, or website that offers third party contributions - would face the risk of a prima facie claim under the music industry's vision of the enabler provision.

In such cases, the courts would then proceed to a six part analysis to see whether the site is liable under the provision. I've already posted on how a site like Youtube could be caught based on claims currently made by Viacom. Many other legitimate sites would also face liability risk with this expanded provision. The six part analysis includes considering whether the site was used to enable a significant number of infringements, the ability to stop the infringement, the benefits received from the infringement, and the economic viability of the service without the infringement. (two other factors are marketing infringement and significant other uses).

Search engines would certainly face claims that they enable infringement, have the ability to stop it (the music industry often says Google can do more), benefits commercially from the infringement, and would not be viable if it was forced to screen or stop every act of infringement. The same may be true for social networks. Facebook's IPO document identifies the legal risk from copyright claims outside the U.S. where protection for third-party action is less developed (Canada would be an example of such a country). Sites such as Reddit, that encourage users to post thousands of links to items of interest, may be caught as well given the possibility of a significant number of infringements, the absence of moderation to stop such links, commercial success of the site, and the economic inability to moderate or stop all potentially infringing user contributions.

But the real target here may not be Google, Facebook, or Reddit, even though the risk is real. The more likely target are newer startups that may push the envelope with exciting products and services that the industry may not like. Consider the emerging popularity of Pinterest, which is adding millions of users and already generating discussion about copyright claims. New startups would be particularly vulnerable to these legal risks since venture capitalists may be unwilling to fund them and expensive litigation is typically beyond their means.

The music industry demands do not stop there. The same document calls on the government to extend the private copying levy to include digital audio recording devices. In other words, the industry is seeking millions from Canadian consumers with an iPod tax (an omission from the bill it describes as an "oversight").

It also wants to extend the term of copyright for musical works from life of the author plus 50 years to life plus 70. The dangers of copyright term extension were extensively discussed on this blog here, here, and here. The music industry proposal would freeze new musical works from entering the public domain in Canada for two decades, mean no new works would enter the public domain in Canada until at least 2033.

In addition to these demands, the industry wants to remove the extension of fair dealing to cover parody or satire, remove the provision protecting user generated content from the bill, create new takedown requirements for Internet providers, and increase the limit on statutory damages for infringement from those found in the bill.

It is striking to contrast the music industry's extreme demands with the Canadian Library Association, who is seeking just two changes - an amendment to ensure access for the blind is consistent with an international treaty being developed at WIPO and a single sentence to the digital lock provision to allow for circumvention for legal purposes.

The music industry demands necessitate a strong rejection from the government as the massive, radical overhaul of C-11 it is seeking cannot possibly be described as supportive of reasonable copyright reform nor of facilitating the digital economy. Further, it reminds millions of Canadians that they must speak out against these changes and for modest reform to the digital lock rules. Time is of the essence as the Bill C-11 committee plans to conclude its hearing and review of the bill by the end of March.
Comments (39)add comment

Ki said:

...
And yet none of these changes will help to solve their problems (or at least the ones they claim these fixes would be fixing), only cause Canada to fall behind the rest of the world when it comes to innovation in the modern world. Which I do think is probably their aim.
February 29, 2012

Mikey said:

...
"It is an infringement of copyright for a person to provide, by means of the Internet or another digital network, a service that the person knows or should have known enables acts of copyright infringement if an actual infringement of copyright occurs by means of the Internet or another digital network as a result of the use of that service."

Don't they realize that puts all home networks and even their own corporate intranet at risk? Talk about shooting yourself in the foot!
February 29, 2012

Anon said:

...
What I see happening here, is websites just putting a blanket ban on all Canadian IP's to avoid dealing with this mess. This is completely pretarrrrded.
February 29, 2012

Scott said:

Why I stopped buying music and listen to the radio
It is attitudes and actions such as this that drove me away from music. Now if it is not on the radio or on my limited CD collection I cannot be bothered. The industry's attitude has lost them a customer and I don't feel the need to pirate or cheat as the content is simply not worth the price of admission on either side of the coin.
February 29, 2012

Anonymous said:

Well, Yeah...
Good luck with that Canadian music industry
February 29, 2012

Mike said:

...
So they want to tax ipods to compensate the industry for private copying, but won't allow circumvention of digital locks to actually let you format switch, the very act that this tax legalizes? These changes will only accelerate the death spiral of this industry.
February 29, 2012

Marcel said:

Me too
If the music industry is permitted to control my internet experience, I demand the right to control the internet experience of anyone else.
February 29, 2012

IamME said:

...
Anon said:
"What I see happening here, is websites just putting a blanket ban on all Canadian IP's to avoid dealing with this mess. This is completely pretarrrrded."

I completely agree, we would certainly see sites like Facebook and Youtube putting a blanket ban on Canada. The reality is, Canada is a very small market compared to many other parts of the world. The loss incurred by blocking Canada out would be minimal.

Ki said:
"only cause Canada to fall behind the rest of the world when it comes to innovation in the modern world. Which I do think is probably their aim."

I agree with this also. They are incapable of future thought and stuck pining for the hay-day of the 80's and 90's. I think they truly believe that if they block out enough of the world, the Hay-day will return.

Mike said:
"So they want to tax ipods to compensate the industry for private copying, but won't allow circumvention of digital locks to actually let you format switch, the very act that this tax legalizes?"

Simply put, they want their cake and eat it too. They want to charge a private copying levy on digital media, but want to make it illegal to actually perform said private copying. Sure they might argue the music industry no longer uses digital locks, but once there is legal protect of those locks, you can bet your a$$ they will start using them again.
February 29, 2012

Crockett said:

A bridge too far?
I read an inserting article [http://arstechnica.com/tech-policy/news/2012/02/riaa-sort-of-responds-to-critics-says-copyright-offers-little-real-protection.ars] that talks about a real, possibly insurmountable, cognitive disconnect between those who want to greatly strengthen copyright & punitive oversight, with those who think such efforts have already gone too far.

I travel the world quite extensively and see this disconnect in other realms. In some middle eastern countries the concept of individual liberty is something that many cannot grasp. The burning of a flag may seem to us like a waste of good fabric while to them is meant as a collective insult to our nation. The act of a cultures individual is a attack from them all.

While these are loose parallels, the disconnect here between some [not all] creators and more notably the media industry with the general public is becoming a widening chasm. The demands as stated above are so far outside of what the average person sees as reasonable as to be classified delusional. I understand the old tactic of 'ask for the moon' but now that the internet provides a public outing of such once behind closed door negotiations, it is more than counter productive. Unreasonable requests just harden peoples resolve to dismiss your concerns. In my opinion, such behaviour has done more to drive people to piracy than anything else (or at least give a self moralizing excuse).

When I say 'some' creators I should point out those out there who really do seem to get the new realities we live in. These artists are using new technology to engage, entertain and distribute their works, and quite successfully. A couple of my favourites, whom I have recently discovered and have purchased their albums, are: http://thepianoguys.com/newstore/ and http://www.youtube.com/watch?v=d9NF2edxy-M I hope you like them and if you do will support them!

To the 'professional representative' groups out there who are not willing to make an effort to engage but instead look to ridiculously overreaching laws to make their way ... get a life.
February 29, 2012

Kelly said:

...
The irony is that without open internet, most of these artists wouldn't be heard of outside of Canada.
February 29, 2012

JDulle said:

...
Does anyone think that the canadian goverment would actually make those requested changes to bill c-11? I'm worried that they will... :(

And what's next... them trying to make it illegal to tell a joke to your friend or to sing a copyrighted song in the shower?
February 29, 2012

ENO said:

Forcasting a broken Internet
The Internet and computers in general are basically digital copy machines; you aren't going to halt piracy without destroying much of the Internet along the way.

...from ars technica article: RIAA (sort of) responds to SOPA critics, says copyright "offers little real protection"
By Nate Anderson http://bit.ly/z8ktSQ
.
February 29, 2012

JDulle said:

Another question...
Is there anything we can do to prevent those changes form being made to C-11
February 29, 2012

Crockett said:

Check out the internet blueprint for a better internet
This is a crowd sourced effort to develop good internet policy. Have a look at the ARS article then check out the site itself.

http://arstechnica.com/tech-policy/news/2012/02/why-wait-six-ways-that-congress-could-fix-copyright-now.ars?src=fbk
February 29, 2012

JDulle said:

To Crockett:
I checked out that webpage. I has very good points of what copyright law should be. I really wish that goverment and lobbyists have the same attitude towards copyright law as us consumers. Instead they insist to make copyright law stirter and possibly violating people's rights :(
February 29, 2012

Mike said:

Member of the AFM
I wouldn't be surprised if my union supports this bull. Making all of us look bad.
February 29, 2012

Zeeman said:

...
alternatively you could contact stuart@cimamusic.ca to voice your displeasure with C-11.
they even provide a client list to boycot
February 29, 2012

Glidermike said:

A Solution
The only way for us to have our rights protected and keep the internet free of media control?---Throw out copyright laws completely.(or at least pull them back to what they were a hundred years or so ago).
February 29, 2012

Adel said:

...
Even if enacted, it would be unenforceable given the failure of e music industry to change its business model to reflect current technology. As almost every entity searching for its last breath before sucoming to finality, this bill is its "uuugh"
February 29, 2012

Where'sreason? said:

What are they giving up?
Seriously. What are they giving up to earn all of this???

This type of shopping list just goes to show that these people have lost touch with anything approaching planet reality. They want things ratcheted down, they had better be giving up every subsidy, every grant, every cent of public money. They want a free market then tear down the digital borders, stop geoblocking us and wipe out every cultural protection. I want to see how long these people could stand up against the BBC and the other content providers from around the world.

Give us, the consumers and the citizens some reason to be something other than increasingly pissed off with the tactics of people sitting around board rooms trying to justify their own existence and line their own pockets at the expense of the creators.

Where are the checks and balances. We don't even get rights as consumers, let alone citizens with the type of back room/secretly negotiated trade agreements and lobbyist based laws like this. Where is reason in all this? Where is the sanity check?
February 29, 2012

Jeff Hume said:

...
Members of this group include Arts & Crafts, Last Gang Records, Mint Records, MapleMusic and many many more celebrated Canadian labels.

I am sending them messages on Twitter and posting on their Facebook page walls asking them if they approve of CIMA, their representative, doing this and if they will speak out. This is just really disappointing.

I think this is actually a situation where our efforts in getting in touch and pressuring these companies could pay off. These labels have good reputations. Let's make them accountable for the actions of the group that represents them and not let them hide behind it.
February 29, 2012

Sh'yeah said:

NOT THE PRECIOUS INTERNET?!?!?
Not going to waste too much time on this as the blogger is so biased that he can't present the STORY in an informative manner, but would it really ruin the internet to make sites more accountable for their content? How much innovation and creation are we willing to piss away in the name making memes and other rubbish a top priority?
March 01, 2012

Hmm said:

@Sh'yeah
1) If you don't like memes or other "rubbish," what does it cost you to look away? Trolling doesn't hurt you. And, if the Internet is somehow used to coordinate an actual crime, there has to be an interface with reality, so that's where to prevent or fix it. Ex: if people's credit cards are stole, why note have law preventing retention and adequate processing and accountability policies? If people are stalked on social websites, why not expect some help and accountability from the specific social service? We don't need an eye in every toilet to prevent shoplifting.

2) Privacy is still a right, even if you would be willing to give yours away. You get you choose for everyone else, and I'm not going to give up my privacy in advance for some hypothetical.
March 01, 2012

Hmm said:

@Sh'yeah, correction
2) You DON'T get you choose for everyone else
March 01, 2012

Hmm said:

@Sh'yeah, again
@#%$! "TO choose"
March 01, 2012

Crockett said:

Babies and bathwater ...
@Sh'yeah "would it really ruin the internet to make sites more accountable for their content?"

Well I suppose that depends on the measures you take to do so. Do you burn down a house because it has a termite problem, or cavity search suspected shoplifters? There are degrees of action to be taken when faced with a problem, overreaction often leads to unwanted or unintended results. The tactics of the media industry have been nothing but failures that have fueled the fire.

Is digital infringement a problem and does it cause hardship for creators? Most would agree that it does to some extent. Is there an purposeful exaggeration of the problem to promote or preserve a particular system? ... even the very supportive US government has acknowledged this. While it does need to be actively dealt with to mitigate the harm, it will never be eradicated. The consequences of trying to accomplish such should be seriously weighed.

Separating out the emotional affront of infringement, a realistic estimation of the profit loss directly due to digital 'piracy' is in the range of 10%, while significant it is hardly life destroying. Other factors such as media technology shifts (money spent on X-box over CDs) and a change of consumer buying habits such as moving from the album to the single, has had a much greater impact on the media industry's bottom line. As a whole though the TOTAL music economy is actually doing very well, outpacing many other sectors in a depressed economy. It is the recorded music industry that is suffering, but is that such a shame ... isn't it supposed to be all about the Artists?

Instead of pushing more people away from legal alternatives with offensive legislation and restrictions, a more proactive approach of using new technology (which is not going to go away) would bring better results. I would suggest that working with the new systems rather than against it will win you fans & supporters who will generate returns much greater than the thin contracts the media industry offers.

Is 'piracy' wrong? Yes.
Is it going to go away? No.
Can it be minimized? Yes.
At all costs? No.
Is it time to for everyone to pause, step back and rethink this whole mess? You betcha.
March 01, 2012

Mike H said:

What does CIMA do, exactly?
Looking at their page, they seem to have an awful lot of burueaucracy - no actual artists listed, just labels. But they do seem to attend a lot of trade shows - that supports independent music??

Let's start a Twitter trend: #TellCIMA
March 01, 2012

end user said:

...
And yet none of these douche bags can build a website that distributes their music directly to consumer at a fair price. I might be wrong here but are we still stuck in 1995 Internet technologies or something that its impossible for these idiots to digitally distribute "their" works?
March 01, 2012

end user said:

...
Looking at their site I guess I answered my question. Flash Banner FTW! Here's lots of independent music for free http://www.ektoplazm.com
March 01, 2012

JoeBil said:

Bill C-11 Demand
The Canadian music lobbyists will obviously ask for as many amendments as possible hoping that they get some of them approved by the government. This is their tactic
March 01, 2012

JoeBil said:

Greed vs. Innovation
It's a battle between greed and innovation. Unfortunately, like in many cases I fear that Greed will prevail over innovation and politicians will cave to well paid and influential lobbyists.
March 01, 2012

end user said:

...
>JoeBil said: It's a battle between greed and innovation.

BUT they don't need innovation! The delivery method straight to a persons any where is already there and has been there since 1995. It's called the Internet.

Setting up a server takes very little time and cost theses days. You can hire one admin and couple of admin/devs for the website and have full catalogue of music available to Canadians in a few months.Gimme albums at $5 and I'll be buying one per day. Mind you this is the hardest step and that is, will the "musicians" innovate and be creative enough with their music for anyone to buy it?
March 01, 2012

fair_n_hite_451 said:

...
Wow.

Just wow. The unmitigated gall is astounding. It's nothing short of seeking to enshrine their right to make money a certain way in law.
March 01, 2012

David said:

...
CIMA is just shotgunning recommendations with the hope some of them make it into the final bill. The bill for the most part as is, is pretty close to balanced save for the godawful TPM section and the conservatives must know this as it consistently with everybody other then CIMA has been pointed out on how it nullifies fair dealing rights and is pretty much the main point of objection to the bill as a whole (not to undermine the other flaws). They fix that, they might get the bill through with only minor objection. They start adding some of the stuff CIMA wants, they risk major condemnation of the bill by the public and opposition parties and the bill having to go back to committee causing major delay. I don't think they'll try and add many of the amendments CIMA wants, and if they do then the conservatives are more incompetent then I thought.
March 01, 2012

chris said:

hogwash
i believe all music and movies should be free since we pay for the service from our provider in which these companies should go after the isp's for their share of the pot. Since it costs to download and such which should cover all aspects of the cost of paying music and movies industry.
March 01, 2012

Mike said:

Incredible
What gets me is the fact that CIMA is funded by our federal tax dollars. We're paying this organization to strangle our internet.
March 02, 2012

Oksigen said:

Majors are driving the show behind the scene
Why nobody clearly say out loud that the Major of Media industry is paying our Govs and politicians big time back doors to find a way to regulate the internet, the way Majors want's it to be ? Isn't this obvious ? To me it is as clear as water ....
March 02, 2012

Chris L said:

Over-reaching, rent-seeking and just plain wrong.
The 'enabler' provision is obviously ludicrous, as what they're asking for would allow them to take down Facebook, Reddit, Google, etc if someone posted a link to copyrighted material. In theory, this might be a defensible (if not overreaching) argument. The reality of course is completely different: as we've seen with the abuse of the copyright system on YouTube (search for "bird song youtube") these companies will not use these abilities in a rational, factual or even legal way. They'll have the upper hand in claiming copyright on anything they feel like, and it'll be up to tech companies and individuals to foot the legal bill to refute the claim.

What the industry is doing is rent-seeking plain and simple (if you don't know what the term means, look here: http://en.wikipedia.org/wiki/Rent-seeking). It's a bunch of whiny, self-important companies who think they have some sort of right to exist and make money -- simply because they've existed up until now and have been profitable. Businesses change. Technology changes business. Businesses either adapt or die. At least, that's how it's supposed to work. Now with corporations spending more money on lobbying than ever before, they hope to use the last vestiges of their wilting power to try to buy their own survival rather than adapting to the new reality.

The statutory damages request is also troubling. Given this governments love of all things American, they'll probably go for it -- at least, until the inevitable public backlash. Damages should be strictly limited to /actual damages/. If you downloaded a song and uploaded it to nobody, the damages should be no more than the purchase price of the song.

The simple boiled-down reality of all this is simple. These groups know one thing -- you will never stop piracy on the internet as it exists today. Given that knowledge, the next best thing they can do is to screw up the internet as massively as they can through legislation enacted by their wholly-owned subsidiaries -- politicians. If nobody wants to use it anymore, there won't be any piracy.
March 05, 2012

Dennis Monague said:

The History Behind the Issue
I find it funny that nobody has mentioned the basic reason that copyright law exists. It exists to protect the rights of the ARTIST to benefit from their creative endeavor and provide a balance between that right and the public good and community culture which belongs to us all. Copyright law exists because hundreds of years ago the costs of publishing a literary work was born by the artist, to ensure that the literary process wouldn't become a detrement to the author, and therefor encourage further creations. It is deplorable that it is big business we hear touting rights and infringement. They themselves create nothing and when they are done leave us all the poorer as they bind our community culture tighter and tighter in a legal morase that will see them eventually controling all creativity.

All creativity stems from the creations of those who came before. We all share the very special and enriching history of the human experience evident in every artistic creation. Perhaps we should take big business to court for unjustly benefiting from derivitive products from material in our common control? The Beatles, when they created the song Imagine (a song that has changed the very human perception of war), created it from the many teachers, contemporaries, experiences and influences that shaped them as human beings. Imagine, pardon the pun, that they had been restricted from creating that song due to an over legalized copyright system as proposed today.

I believe we should be returning to the grass roots of copyright. Copyright should be restricted in accordance with the changing culture of the particular industry the work lies. For instance a song has a life of perhaps 1 year, a movie (due to the false markets created by the seperate releases of a movie to the various formats imposed by the movie industry) perhaps 1.5 years, etc. After this the material falls to the public domain. Perhaps as a courtesy only, we would allow certain other rights to be held for longer periods. For instance the right to commercially benefit from a song for a further 2 years to allow for certain comebacks and re-releases etc. Other rights, such as the right to derive new works would fall to the public domain immediately.

SIDEBAR: Did you know that in the USA and Canada (I think), every creative work ie. books, songs, etc., must be submitted to the respective government archive for the good of the public? It is common practise now that works are submitted to the Archive and promptly "checked out" in "paper" (the actual work may never arrive in the first place). I'm optimistically sure that this doesn't extend to all works but it is worth checking out.

May 01, 2012

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