CRIA and Kazaa
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Tuesday September 06, 2005
CRIA' s reaction to the Kazaa ruling provides a helpful advance preview of its likely comments before the parliamentary committee reviewing Bill C-60. The release applauds the Kazaa decision (CRIA was ready for this one as its PR firm emailed journalists on Friday with offers to comment on the decision), includes some deceptive comments (eDonkey and BitTorrent have not been shut down; servers or nodes running the programs have been targeted) and uses the decision as a springboard to make several claims that must be challenged.
First, CRIA seeks to link the Australian decision with Canadian copyright reform. In reality, the two have as much in common as Australian rules football does to ice hockey. As I noted yesterday, the Kazaa case turns on authorization, an issue that is not at play in Bill C-60 since it is grounded in Supreme Court doctrine. Even if Parliament were to enact Bill C-60 with the additional dangerous amendments advocated by CRIA, a Kazaa case in Canada would still boil down to the authorization analysis.
Second, in a claim designed to appeal to Canadian Heritage, it describes the implementation of WIPO in Canada as "WIPO-Lite", questioning whether the bill will be effective and allow Canada to "implement its international treaty obligations." We should be clear: Bill C-60's provisions (particularly the anti-circumvention provisions) are absolutely WIPO compliant. While a few lawyers may be paid to say otherwise, the independent law professors representing ten universities from across Canada contributing to the forthcoming book on Bill C-60 leave little doubt that the Canadian approach meets the requirements of the treaty. Moreover, it should be noted that Canada does not have any international treaty obligations. We signed the WIPO Treaties in 1997 but that act does not create any new obligations on the country (only ratification of the treaty creates obligations).
Third, there is the absurd claim (designed to appeal to Industry Canada) that Canadian copyright laws have hamstrung online music sales. CRIA claims that "digital sales in this country run at one-half of one percent of US levels, but should be in the 12 to 15 percent range given relative broadband penetration in the two countries."
We should again be absolutely clear: Canadian online music sales have nothing to do with Canadian copyright legislation or copyright reform. What is behind the slower Canadian sales (assuming this is correct; the industry has not provided the public with these numbers)?
First, slower sales reflect a broader Canadian trend in e-commerce. There is no correlation between broadband penetration and online music sales nor any other form of e-commerce as Canadians have been slower to gravitate to all e-commerce offerings, from books to travel to music. You don't see Amazon or Expedia claiming that it is the Canadian legal framework that has slowed adoption of their online offerings because the two simply aren't directly linked.
Second, there are far fewer online music services in Canada than in the U.S. According to IFPI, the global recording industry association, Canada currently has six services (Archambault, iTunes, Napster, Future Shop, Sympatico, and Puretracks). By comparison, IFPI lists 34 U.S. services. With nearly one-sixth the number of online music services, the lower Canadian numbers are precisely what you would expect.
Third, the Canadian services offer far less music than their U.S. counterparts. Numerous U.S. services offer more than 1 million tracks. In Canada, only iTunes does. Moreover, iTunes has some major Canadian misses. Where is the French content (funny that Canadian Heritage Minister Liza Frulla is concerned with satellite radio french content but says nothing about the lack of French offerings on iTunes)? Where are groups like The Arcade Fire, one of Canada's hottest bands that made the cover of the Canadian edition of Time Magazine?
Fourth, the Canadian services are much newer than their U.S. counterparts. Consider the growth rate of iTunes in the U.S.: it took Apple 11 months to sell its first 50 million songs and then another four months to get to 100 million songs. Three months later, the company hit 150 million, and it took just two months to get to 200 million. The growth rate has continued with iTunes recently surpassing 500 million songs. Here in Canada, iTunes only debuted nine months ago in December 2004. In other words, Canada is still at the very beginning of the growth chart and its performance is similar to what occurred in the U.S.
Fifth, the online music services themselves are turning off consumers due to compatibility problems. As a Macintosh user, I still can' t use services such as Puretracks or Napster. Moreover, even if I could, Napster doesn't allow me to listen to the music on my iPod.
Sixth, the Canadian industry has benefited from the private copying levy. CPCC reports that it collected more than $39 million in 2004, by far the most amount ever generated by the levy. That will result in millions of dollars for artists and their labels that sit alongside the growing revenues from the digital sales market.
In sum, the Canadian market for digital sales may be behind the U.S. but that is an industry issue, not a copyright problem. CRIA may have used a slow news day to generate some unchallenged news stories, but the parliamentary committee considering Bill C-60 in the fall should not allow these same claims to go unquestioned.
Chris Smith said:
Dwight W. in Ottawa said:
E.G. Howe said:
Iain George said:
Andrew Tonner said:
tOM A Trottier said:
Tuesday September 06, 2005