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.