Canadian Heritage Committee on April 8th, 2014

[Ian MacKay]

It's mostly a question of ensuring that the board has the resources to do what it does and of making sure that the timelines can be reduced. Since the industry has changed so much, the board is faced with more and more things that it needs to deal with.

At the same time, the music industry and the business models in the music industry are changing so rapidly that when you have a regulatory process that takes several years from start to finish, you can have a decision on a rate for webcasting services that is already two or three years out of date by the time it's rendered, because it was based on the industry of two or three years earlier.

Given how quickly things are changing, and given how, I think, what we all want is a very dynamic, successful music place in Canada where entrepreneurs are trying everything they can to distribute music and to get money back to rights holders, we need a regulatory body that is resourced well enough that it can turn around the decisions and establish the rates that allow the entrepreneurs and the music services to say, “Yes, Canada is a place where I'm going to launch, because I have business certainty.”

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Ms. Morin, Mr. Nasra and Mr. Petit, is your analysis the same? Is there a need to be filled?

[Sébastien Nasra]

Yes, indeed.

[Annie Morin]

Yes, Mr. MacKay is absolutely right.

Given the evolution of the market, there is a proliferation of tariffs, and the commission is, to some extent, drowning in these applications when its resources are very limited. There should be more people, perhaps commissioners, so that the decisions are made more quickly. That would definitely be beneficial for all of the rights holders involved.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Mr. Petit and Ms. Morin, you added recommendations on this subject.

Can you tell me which ones the government could follow up on the most easily? Which recommendations should our committee make to the government so that there are not too many problems?

[Annie Morin]

A private copy regime is already in place. It has already been the topic of much debate. That regime could be broadened to cover, at the very least, devices and blank audio support, as that is currently not the case. At present, people are not copying music onto blank CDs. That is the only support that includes royalties under the private copy regime, and the public is no longer using it.

If we could extend the private copy regime, which has contributed considerable royalties to rights holders in the music sector, that would be a very good thing. Since the regime is already in place, amending the act to include the devices should be very easy.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Do you agree with that recommendation?

Mr. MacKay, did you understand?

[Ian MacKay]

Yes, that would be in accord with what is going on in other territories.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

In other countries?

[Ian MacKay]

Yes.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

In the United States, as well?

[Ian MacKay]

The United States does have a private copying regime. I'm not sure exactly how it works, but certainly in Europe it's the way it works.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Is there anything else you would recommend?

In the list you presented previously, you went as far as talking about artists on salaries. It went far.

[Richard Petit]

We recommended that to help artists to focus on their work. If we want a rich culture and artists to offer good products, they must be able to focus on their work. If they are forced to work 30 or 40 hours a week at another job, then...

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

I apologize for interrupting you, but I only have a few minutes. I understand the problem.

I would like you to present the most concrete solutions from among the ones you mentioned.

[Richard Petit]

Once a grant is given to an artist for a given music project, it should automatically come with a salary. It should not be an advance from a record company, an advance that will eventually have to be reimbursed. The grant should be attached to the project as payment to the artist while he works on his project, even if it represents a minimum wage.

[Annie Morin]

It is about a parallel revenue stream.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Yes, I understand.

Mr. Nasra, do you want to react to that?

[Sébastien Nasra]

No.

Work needs to be done on that as well, but I have one final recommendation that is different.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Okay. What is your recommendation?

[Sébastien Nasra]

I want to go back to a point I think is central, the workforce.

Since we must face the challenge of the digital era, a relatively simple measure would be to put in place a super tax credit on specialized workers' salaries in the digital field. That would help companies.

Initially, a measure like that would enable independent companies like mine to have access to specialized people in the digital field. Secondly, it would make it possible to keep these people in the company and create a cash flow. I am talking about a super deduction, for example, double the salary paid to the employee for a two or three-year program. That would be very concrete and quickly respond to the urgent needs flowing from the challenges of digital technology.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Thank you for your recommendations.

[The Chair, Conservative, Gord Brown]

Thank you to our witnesses. I'd like to thank you for your contributions to our study. If you have anything further, please send it to us in writing.

At this point, we are going to adjourn the public portion of the meeting. We do have five minutes of committee business for the committee to deal with in camera.

We'll suspend briefly.

[Proceedings continue in camera]