Bill C-11 Committee on Feb. 29th, 2012

[The Chair, NDP, Glenn Thibeault]

Good afternoon, everyone. Welcome to meeting number 5 of the Legislative Committee on Bill C-11.

I'd like to welcome our witnesses, our guests, and the members, and also just do a quick acknowledgement to all of the members and individuals today who are wearing pink on Anti-Bullying Day. So Mr. Regan and others.... Mr. Braid, you have it on your tie. I'm very obvious with the shirt and the tie. I'd like to acknowledge everyone on that.

[Charlie Angus, NDP, Timmins—James Bay, ON]

I can see they're doing laundry.

[The Chair, NDP, Glenn Thibeault]

Thank you, Mr. Angus, for sharing a bit too much information. We'll move forward from there.

I'll start off to introduce our witnesses: from the Canadian Independent Music Association, Stuart Johnston and Robert D'Eith; from the Canadian Artists Representation Copyright Collective Inc., Janice Seline and Adrian Göllner; and then from the Canadian Consumer Initiative, John Lawford and Janet Lo.

Welcome, guests. You will have a ten-minute presentation per organization. I will inform you that I am a stickler for time, so at the ten minutes I will be interrupting you if you haven't concluded by that time.

We'll start off with the Canadian Independent Music Association, for ten minutes.

[Stuart Johnston, President, Canadian Independent Music Association]

Good afternoon, and thank you very much for the opportunity to address you today on what my industry considers to be the most important bill to go before government.

As mentioned, my name is Stuart Johnston, and I'm the president of the Canadian Independent Music Association. Joining me today is one of my volunteers and board members, Mr. Bob D'Eith. He's the secretary of my board, the chair of my government affairs committee, and in his day job he's the executive director of Music B.C., a provincial music industry association. Bob's also an entertainment lawyer, record label owner, and two-time Juno award nominated recording artist.

You should already have our submission on Bill C-11, which outlines our 12 recommendations for improvements to the bill, so we will try to be brief in our remarks.

By way of background, CIMA represents more than 180 Canadian-owned companies and professionals engaged in the worldwide production and commercialization of Canadian independent music, who in turn represent thousands of Canadian artists and bands. They are exclusively small businesses, which include record producers, record labels, publishers, recording studios, managers, agents, licensors, music video producers and directors, creative content owners, artists, and others professionally involved in the sound recording and music video industries.

To put our industry's size in perspective, the Canadian independent music sector, taken as a block, is one of the largest in terms of sales in this country, second only to Universal Music Canada. According to Nielsen SoundScan sales figures, the independent sector accounts for approximately 24% of all music sales in Canada, which is larger than EMI and Warner Music put together and Sony Music by itself. In short, our members are the owners and operators of small businesses who invest in the creation of intellectual property that spurs economic benefits in terms of jobs, increased GDP, contributions to our nation's trade balance, and are an integral component of Canada's culture as expressed through music.

As Canada's economic sectors continue to evolve, CIMA believes that the creation and protection of intellectual property is one of the few potential growth areas for our economy, particularly through exports. We wish to thank you for this process, and for the responsibilities that you are undertaking to ensure that all views are heard and considered before final approval of the bill is given. We are pleased that we will finally see the bill go before Parliament this spring, because we've waited far too long for a new copyright act.

CIMA members and the broader independent music sector in Canada, as noted, are small businesses struggling to survive in a very challenging market, a difficult environment in which to be creative, innovative, make investments, maintain jobs, and earn a living. Therefore, we believe that the modernization of Canada's copyright regime is crucial not only to our sector but to the broader economy as well.

While we support this bill, Bill C-11 has the potential to either be critically important or it could in some ways make an already challenging climate that much more difficult for our independent music sector to survive in, let alone grow and thrive. We shall explain this shortly.

CIMA and its members, while generally supportive of the bill, believe it needs a few amendments, some technical, some more than technical, in order for it to truly reflect the government's stated desire for it to help create jobs, promote innovation, and attract new investment. Most importantly in our view, it must also give creators and copyright owners the tools to protect and be compensated for their work. This last point cannot be understated. If we pull away all of the rhetoric, grandstanding, misinformation, and misunderstanding of what copyright protection really is, it should be self-evident what the real reasons are to have strong legislation in place and how important Bill C-11 really is.

The bottom line is that music is commerce. Music is a commodity. It can be characterized as art in its final form. It can be used to define and contribute to our culture, but first and foremost it is a commodity. Governed by the rules of business, it relies on supply chains, domestic and international trade. It can be bought, sold, licensed, for various uses. It is a business that employs many thousands of people, directly and indirectly.

But somewhere along the way, when music was digitized into a series of ones and zeros, it somehow became okay in some circles to steal it, share it, pass it around, all without consideration as to what harm that is doing to the individuals who invested their time, money, and creative energies into that product, not to mention all of those along the supply chain who contributed to that product being brought to market. They are the artists, their labels, their manager, producers, sound engineers, manufacturers, distributors, retailers, and the list goes on. Fair compensation for a product enjoyed by consumers is required to pay all of those good folks in that supply chain. It really is no different from any other service such as professional services, the IT industry, the auto sector, and mining.

We have rules and law in society that tell us that stealing a car, for example, for personal use or resale is wrong. The same people who illegally download and share a track or album would in all likelihood not be the same people who would go into HMV and walk out of the store with a handful of unpaid CDs. It just doesn't happen. Yet in a virtual sense, that is what is happening on a grand scale around the world and in Canada in particular. This theft of music is being facilitated by certain private sector interests like Canada-based isoHunt, the Sweden-based The Pirate Bay, and New Zealand-based Megaupload, thereby depriving my industry the compensation it deserves, while at the same time they are financially benefiting from this illegal practice.

At the beginning of this year, four of the world's top five BitTorrent sites were connected in whole or in part with Canada. isoHunt yesterday filed claims in a Canadian court that their operations are completely legal, claiming Canadian law makes it completely legal. This flies in the face of the intent of Bill C-11. Canada unfortunately is seen as a haven for these types of digital parasites. According to court documents, even the aforementioned Megaupload considered moving its servers to Canada at one time in order to avoid prosecution.

This is not piracy. That's too fanciful a word, and brings a connotation of Hollywood romanticism. What we are talking about is straight out theft. We need tough rules in place to prevent these so-called wealth destroyers from engaging in and enabling theft. We need a new copyright bill.

My colleague Robert D'Eith will continue with the rest of our presentation.

[Robert D'Eith, Secretary, Board of Directors, Canadian Independent Music Association]

Thank you.

There are a few particular sections. The first is in regard to the non-commercial user, which is the section 22 clause. We understand the government is trying to allow innocent consumers to use the Internet without undue restrictions. This section opens a door that is unprecedented in the world. The non-commercial user language is vague, and could potentially lead to the devaluation of musical copyrights. Notwithstanding the sections that try to balance this, we feel that not having a clear enforcement mechanism that will deal with this will lead to devaluing of copyrights and the abuse of creators' moral rights.

Another very troubling section is the notice and notice provisions in section 41. The independent music sector is built on individual entrepreneurs and small businesses. The section as drafted places an unreasonable burden on the copyright holders to enforce their copyrights. It's impractical to expect copyright owners to go to court every time there is an infringement notice. The copyright infringer will continue to infringe with impunity, knowing there is very little chance that the copyright owner will have the resources to come after such infringement. We strongly urge the government to reconsider this section and create a fair, robust, and equitable provision that provides protection for ISPs while still allowing for notice and takedown of illegally posted intellectual property.

As for statutory damages, capping statutory damages at $5,000 will make damages the cost of doing business on the Internet. Individuals and small-business copyright owners will look at the cost of litigation versus damages and decide that litigation is impractical. Further, even if there is a judgment, it's far too small to have any real impact on infringers. Again, copyright infringers will infringe with impunity. In fact, the provisions of this section will create a vehicle of licensing for infringement.

Another section that is very important to us is ephemeral rights. Revenues in the music industry have steadily declined over the past ten years, leading to a crisis in the business. At a time when the music industry needs support, the bill further erodes revenue in this business. The removal of the requirement to pay a broadcast mechanical licence will lead to a reduction of nearly $21.2 million of revenue.

The royalty exemption presently in section 68 of the Copyright Act creates $1.2 million in exemptions for the first advertising revenues of commercial radio stations to pay neighbouring rights royalties. We feel this provision was put in at a time when there was supposed to be a transition to neighbouring rights. At this point, we feel it should be removed. It would create another $8 million of additional revenue to the music industry.

We would also like to request that the length of copyright in all areas be increased from 50 years to 70 years in order to maintain parity with all other jurisdictions.

I guess I am out of time.

[The Chair, NDP, Glenn Thibeault]

Yes, you're out of time. I was just going to say to wrap it up if you could, because you're now out of time.

[Robert D'Eith]

Yes. I have one paragraph. Is that all right?

[The Chair, NDP, Glenn Thibeault]

If you can do it in 30 seconds or less.

[Robert D'Eith]

Yes.

While CIMA's formal written presentation also deals with a number of other suggested changes to the bill, we wish to make sure that the Government of Canada understands the need of the independent music sector. We're struggling at a time of uncertainty in the law and need clear, enforceable copyright laws in order to continue to provide Canada and the world the best quality of music, songs, and musicians. In order to thrive, the owners need fair compensation for their products and services. We urge the Government of Canada to continue to take a leadership role in creating a law that puts Canada ahead of the curve and creates an environment where creators can thrive.

Thank you very much.

[The Chair, NDP, Glenn Thibeault]

Thank you, Mr. D'Eith and Mr. Johnston.

Now we go to Ms. Seline.

[Janice Seline, Executive Director, Canadian Artists Representation Copyright Collective Inc.]

Good afternoon.

I thank you for this opportunity to speak as a member of the visual arts sector. I'm accompanied by Adrian Göllner, who's the past chair of my organization and a practising visual artist himself. We agree that copyright reform in Canada is long overdue.

I work for a collecting society, Canadian Artists Representation Copyright Collective Incorporated, CARCC, representing about 850 visual artists in matters of copyright. In 2010-11 we distributed over $200,000 in royalties to our affiliates, and we have had years when the total distribution has surpassed $500,000. Our affiliates are grateful recipients of royalty income. CARCC operates on money it earns from licensing.

I believe that as we work to reform our Copyright Act we need to remember our principles. Copyright is very ancient, surely older than the Greek playwright who felt hard done by when his plays were presented without his being paid. That copyright is old simply means that it is integral to creation. Artists must have copyright, and copyright must work for them.

Normand Tamaro, a lawyer, has said that the purpose of copyright laws is to provide a fair and civilized environment for the exploitation of creators' works, and artists must be allowed to negotiate compensation on favourable terms for uses of their works. Copyright laws include moral protections for a creator's reputation. Lately the young artist K'naan, invoked his moral rights when he told the Mitt Romney campaign to stop using his song Wavin' Flag. He did not want to be associated in any way with that campaign and he put a stop to it in a public way. His indignation came from that very old place, his droit d'auteur, his author's right.

CARCC is a member of CISAC, the International Confederation of Societies of Authors and Composers, the multidisciplinary association of copyright collecting societies, and its subgroup, CIAGP, the International Council of Creators of Graphic, Plastic, and Photographic Arts. Both these organizations have expressed dismay by letter to Canadian officials at the threats to artists' incomes posed by Bill C-32, and by extension the identical Bill C-11. They are concerned that Canada will lag further behind in its international obligations to harmonize its laws with those of other countries.

A recent report from CISAC summarized the global revenues for collective licensing--this is worldwide--from 2010 at over 7.5 billion euros. This is a lot. Canadian artists must partake of this vital economy.

Here are our specific concerns with Bill C-11, which I will summarize first in case I run out of time. The first one is that while we are pleased that photographers' rights are improved in Bill C-11, we feel that photographers will continue to be disadvantaged by the exception that allows clients to commission photographs to use for private and non-commercial purposes. The second is we would like to see the exhibition right extended to cover the term of copyright, dropping the June 1988 limitation. Third, we would really like to see an artist's resale right included. I think everybody's very enthused about that. We would support levies on digital hardware to cover private copying, and we do not support fair dealing exceptions for education, satire and parody, or mash-ups. Licensing activity in the education sector should be encouraged.

Here's the reasoning behind our concerns. Photography is a form of visual art, and we are thankful that Bill C-11 extends the rights of photographers. However, an exception specifically naming photography, clause 38, has been added, whereby the person who commissions a photograph is allowed to copy for private or non-commercial purposes. The photographer would earn from such copies, and the exception would deprive him or her of income as well as control of the quality of a copied image. We recommend that photographers be treated equally with other visual artists.

Second, Canada's Copyright Act includes an exhibition right that allows artists to require payment for the exhibition of their works if the purpose of the exhibition is not the sale or hire of the works exhibited. The exhibition right was enacted in 1988 and applies to works created after that date of enactment. We would like to see the 1988 date dropped and the exhibition right extended to include all works subject to copyright--that is, life plus 50 years. This would end discrimination against senior artists and the estates of deceased artists, which are often presently excluded. This could easily be put into effect in Bill C-11, and we strongly recommend this action.

Third, Bill C-11 could be vastly improved by the addition of the long overdue artist's resale right, the droit de suite, to the Copyright Act. Resale royalties are percentages of sales of works resold on the secondary market, such as auction sales. They are usually managed collectively. Resale rights benefit artists who have sold their works, often at a low price, only to see them fetch much greater sums later on or in foreign markets. Aboriginal artists and senior artists are the most affected. Some 59 countries around the world have this right included in their legislation. Without the resale right in Canadian legislation, there can be no reciprocity with countries such as France or Britain, and Canadian artists cannot benefit from secondary sales abroad.

The resale right deserves consideration here and now in Bill C-11. Existing collecting societies such as CARCC are ready and willing to take on the administration of the artist's resale right, and there is worldwide evidence that the resale right has little to no effect on art markets.

Fourth, the fair dealing exception for education—as well as all of the exceptions for education, and in particular those pertaining to the Internet—that are detailed in Bill C-11 generally weaken creators' capacity to earn from the reproduction of their works. Creators, including publishers, benefit from the many uses that this enormous sector makes of their works. Creators are the content providers for Canadian culture. Rights holders are paid at the time of publication as well as through collective licensing of reprography, which is used by photocopy.

We believe that collective management has a strong role to play when copies of works are used. Users can use at will as long as they pay for a licence and creators are paid. Reprography must be extended to digital uses and to the Internet. Licensing must be allowed to develop and flourish in this education sector. The education sector should count on paying those who provide its content, as they do those who teach and all the other workers. If they don't, the content will wither and die. Copyright supports culture and national identity.

To add education to fair dealing provisions is to invite litigation and to force creators to defend themselves against claims of fairness on the part of users. Many activities can be called educational. To expect creators and collecting societies to contest every fair dealing claim that comes from a museum or a business, not to mention schools and universities, is to place a very heavy burden upon those who would benefit from copyright. It takes years of unnecessary and expensive litigation to clarify a fair dealing exception, and the judges may well decide that non-payment of rights is indeed unfair to creators. Education really should be removed from fair dealing.

Sixth, the Internet is not the future; it is the present. It's a form of publication that's becoming increasingly important, indeed replacing ways in which copies were made and distributed in the past. It presents huge opportunities. Creators must be allowed to benefit, when their works are used privately, when they're copied from device to device.

A levy on digital hardware similar to that already in place on recordable media would be a fair solution to the problem of payment for private use. The levy is fair payment for something that people actually use—content—without which their shiny devices aren't fun at all.

Besides the economic benefit to creators, there are benefits to users as well. A levy allows people to use with a certain freedom, with no threat to their privacy. It does not replace investigation of the truly criminal activity that is piracy. Law enforcement should take care of that, not the service providers.

Bill C-11 proposes fair dealing exceptions for parody and satire and mash-ups—that is, non-commercial user-generated content. The effect of these exceptions is on the one hand to weaken creators' moral rights, which protect their reputations, and to encourage a culture of entitlement on the other. Canadian satirists have flourished without an exception to copyright. There are still many norms that satirists must respect, even if an exception is instituted.

Visual artists who similarly practice appropriation, a practice often shoehorned into parody and satire, have managed well without an exception. Telling these artists that they are free to appropriate under copyright offers them no protection from other forms of prosecution, such as trademark protections or libel. In other countries, parody and satire exceptions have invited protracted, expensive, and inconclusive litigation. We think they should be dropped from Bill C-11.

[The Chair, NDP, Glenn Thibeault]

Ms. Seline, you've reached your time. Could you summarize for me, please?

[Janice Seline]

Okay.

My last thing is to not encourage the kids to infringe copyright and to respect artists' creations as they would want their own to be respected.

I thank you for the opportunity.

[The Chair, NDP, Glenn Thibeault]

Thank you. You'll have the opportunity to answer questions and get more of your thoughts and opinions out.

I'm now handing it over to the Canadian Consumer Initiative.

[John Lawford, Counsel, Canadian Consumer Initiative]

Mr. Chair, committee members, and Madam Clerk, my name is John Lawford, and with me is Janet Lo. We are counsel to the Public Interest Advocacy Centre, one of four major Canadian consumer groups who have banded together under the title of the Canadian Consumer Initiative, CCI. The other members of this coalition are the Consumers Council of Canada, Option consommateurs, and l'Union des consommateurs.

CCI wishes to bring to the committee our view of the consumer interest in copyright legislation. Consumers are one of three major stakeholder groups in this discussion, along with artists and rights holders. However, despite their huge importance, the voices of consumers have not been loud or clear in this debate.

Consumers buy copyrighted content. They enjoy copyrighted content. They directly and indirectly compensate artists and rights holders. They are an essential part of the equation in achieving a copyright law that fairly grows creative content and personal enjoyment of that content. You can't do it without consumers.

This bill makes strides towards recognizing this foundational role of consumers. We like the explicit recognition of consumer rights: of consumers' rights for all copyrighted content, clear backup rights, format-shifting rights, space- and time-shifting rights. We also applaud the efforts to recognize and validate user-generated content that is non-commercial, creative, and widespread among consumers. As written, that provision ensures non-commercial, non-threatening, non-destructive consumer creativity.

However, we have had to curb our enthusiasm for the expression of these consumer rights in the bill because of their potential override by digital locks or technical protection measures. We continue to believe that the power balance between rights holders and consumers has been tipped too far in favour of rights holders under this bill. Every consumer right under this bill can be taken away by a technical protection measure, and that can be done in two ways.

First, the general protection of technical protection measures in proposed section 41 prohibits consumers from backing up or time- or format-shifting content if a digital block is in place. Second, each of the individual consumer rights listed in proposed new sections 29.22 through 29.24 has a subsection that makes that right applicable only if the individual, ”in order to make the reproduction or record the program, did not circumvent...section 41”.

In effect, then, these sections declare that when a technical protection measure is present, none of the format-shifting, time-shifting, or backup rights even exist. This matters, because consumers will therefore never even be able to argue that they are exercising their consumer rights if they circumvent the technical protection measure. If this bill is passed as written, a consumer who breaks a digital lock for non-infringing purposes will be violating the Copyright Act. Although a consumer would not face statutory damages under the act for a circumvention done for private purposes, we are more concerned with the chilling effect of outlawing all tools that permit circumvention of TPMs, even when designed and used only to allow consumers to enjoy their consumer rights.

In short, no business or individual will write or distribute such software for fear of liability, and the vast majority of consumers will not be able to do this themselves. As a result, consumers will have their rights dictated to them by rights holders, who will likely use this power to deny these rights or to demand additional payments for content that can be backed up or time-, space-, or format-shifted.

Consumers will face a myriad of TPM restrictions on devices, media, and delivery mechanisms that are very likely to make some of the content they have bought unplayable and almost certainly will make that content vastly less secure and less usable. The market will not solve this dilemma. The commercial interests of artists and rights holders go the other way.

The Bill C-32 committee heard Ms. Milman come and explain that she would like to be paid twice, once when a consumer buys her CD and once when they put it on their iPod. The same committee heard Ms. Parr of the Entertainment Software Association of Canada claim that new business models with TPMs would create more choice for consumers, lower prices, and give more flexibility.

Consumers don't think so. They believe and act as the format-shifting, time- and space-shifting, and backing-up normal people that they are. They feel that they have done the right thing by buying content, paying for it once, and using it normally. They have a right to this expectation. It is for the industry to structure itself to be profitable in this environment and for that industry to fairly compensate artists, not for this Parliament to hand an act to rights holders and artists that protects top-heavy, unfair business models and is contrary to the public interest.

At a minimum, this bill should be amended to recognize these consumer expectations and actual use of copyrighted content in the real world. Therefore, we recommend that the committee consider striking out the language I quoted in each of the proposed new sections 29.22 through 29.24, and those are 29.22(1)(c), 29.23(1)(b), and 29.24(1)(c). These TPM restrictions expressed right in the text of the supposed consumer rights are at the very least redundant, and at the most a contradiction of the consumer rights that are supposedly granted in these sections.

As for the larger technical protection measures in proposed new section 41 and what that means for consumers and other public uses of copyrighted content, CCI understands the Canadian Library Association has written a proposed amendment to the committee of the definition of “circumvent” that will “ensure Canadians' ability to invoke their full rights as information users by allowing them to bypass digital locks for non-infringing purposes”. We support that amendment.

With regard to a positive in the bill, we welcome the amendments to the fair-dealing right, including specific listing of education, parody, and satire. However, again CCI is disappointed that the acknowledgement of rights like this that promote the public interest can be limited by digital locks.

Finally, CCI has a specific amendment to suggest to the committee. I have provided it to the clerk in both languages, and I do hope you have a copy before you.

We were very pleased that the bill creates a category of non-commercial infringement for statutory damages that is limited to $5,000 for all violations. This gives consumers some measure of comfort that they will not face unreasonable and unrealistic demands from copyright-based business models of suing consumers who do not profit from infringement.

However, the proposed new section 38.1 as written in the bill still allows suing consumers as a business model. This section gives rights holders an election to sue for actual damages or statutory damages. Although non-commercial statutory damages are capped at $5,000, the rights holder may threaten very large actual damages in the hope that a consumer faced with a lawsuit settlement letter will pay up. The amount demanded could be far in excess of the $5,000 for non-commercial infringement, even if the likelihood of the rights holder proving actual damages in this amount would be practically zero.

The key phrase is “may elect, at any time before final judgment”. This allows the rights holder or agent to threaten to proceed under actual damages and to send that settlement letter right up until final judgment. This power must be removed from rights holders. It has been abused in the United States under the Digital Millennium Copyright Act.

In Canada, we have several Hurt Locker cases against individual consumers waiting in the bullpen for this act to pass. The solution is to require rights holders to elect at the outset of proceedings under the Copyright Act whether to prove actual damages or rely upon statutory damages when alleging non-commercial infringement.

Our amendment will help to ensure what we believe was the original intent of the bill: to guide rights holders toward the capped statutory damages for most non-commercial consumer infringements.

We thank the committee for its attention, and we're prepared to answer your questions.

Thank you.

[The Chair, NDP, Glenn Thibeault]

Thank you, Mr. Lawford.

Now we will go to our first round of questioning, for five minutes. Up first is Mr. Moore.

[Rob Moore, Conservative, Fundy Royal, NB]

Thank you, Mr. Chair.

Thank you to our witnesses. Having listened to everyone as we went across the table, I think it illustrates the balancing act that's required as we try to craft future legislation for the country that balances the rights of creators with those of consumers.

I have a couple of questions. One issue that was raised by the Canadian Artists Representation Copyright Collective was the issue of moral rights. We hear about these from time to time; I usually hear about them in the context of political campaigns. I think it comes up once in a while.

You mentioned it in the context of a political campaign. Can you speak a bit more about that? As you know, those rights are enshrined in this piece of legislation. Why is it important, and what are some examples that would illustrate its importance?

[Janice Seline]

It's funny, because English law called copyright “copyright”, the right to copy. The French call it droit d'auteur, which is deeper; it's the artist's right. The inclusion of moral rights kind of makes it that. It's your right to be credited or to remain anonymous, your right of the integrity of the work. People can't mutilate or overprint or crop your work or print it badly or destroy it without your approval. There's the right that I mentioned that K'naan invoked, that you can refuse to have your work associated with causes you don't approve of, which might damage your reputation. These are protections for an artist's reputation.

Regarding the photography instance I brought up, I said that if you give control of your work away to someone else so they can make copies without your input, it goes to the moral right if you can't control the quality of your work. If a bad copy is circulating and there are many bad copies around, you look bad. Similarly, with the user-generated, non-commercial content business.... I've seen artists where somebody has taken works and done things to them and put them back up on the Internet, and the artist's name is attached to them still. Yes, they've credited that artist, but the artist looks ridiculous, and they're not happy about it.

These are instances of moral rights infringements. Some of them are enormous, and some of them are very small, but it has to do with the artist protecting their reputation.

[Rob Moore, Conservative, Fundy Royal, NB]

Thank you, Ms. Seline.

Mr. Johnston, we've heard the analogy before of the person who wouldn't walk into a CD store and steal a CD, but we hear about piracy, about artists and creators losing control over the material they've produced, and the impact that has. To what do you attribute that? I know there's been a lot of discussion about it, but why is it that some Canadians, some people, would be willing to engage in some acts that would take away that opportunity from artists but certainly not others, when in the end it amounts to the same hit?

[Stuart Johnston]

Quite frankly, that's a difficult question to answer. It's hard for me to put myself into the shoes of any individual Canadian. What we are seeing, though, are the enablers out there who are making it possible for people to download music illegally. I'm talking about the isoHunts and the Megauploads, and those of that ilk.

Really, what we're talking about when it comes to stealing copyrighted material is talking about those so-called commercial entities that are basing their business model on stealing copyrighted material. We're not, quite frankly, interested in the young man in his basement who is downloading. We want to get to the source of it. We're not concerned about that young man himself at all.

[Rob Moore, Conservative, Fundy Royal, NB]

Could you speak quickly to the impact on your members, the impact on individual artists, of piracy?

[Stuart Johnston]

Certainly. I'd like to pass that over to Bob, since he's in the trenches and he can answer it directly.

[Robert D'Eith]

Absolutely, we feel it every day. The entire industry has globally gone from $30 billion a year to $14 billion and smaller in terms of sound recording. That has all to do with free downloading. The fact is that there are some great services out there, like iTunes. For me, personally as an artist, I still sell on iTunes, but it's probably one-tenth of what the sales were when CDs were still viable. What we've seen—

[The Chair, NDP, Glenn Thibeault]

Sorry, we're well over the time. You might be able to get that part out in another question. Sorry.

Thank you, Mr. Moore and Mr. D'Eith.

Now to Mr. Angus for five minutes.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you.

It's a very interesting discussion.

Mr. Johnston, what do you want to raise the statutory damages to?