Bill C-11 Committee on March 1st, 2012

[Mario Chenart]

There are some who are producers.

[Solange Drouin]

There are examples you are familiar with. To say that no money goes to the artists is completely false. They receive it under their "author" hat, if they are authors. Yes, there is money that goes outside Canada, as I explained earlier, but there is also money coming into Canada.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

The question of reciprocity with France...

[The Chair, NDP, Glenn Thibeault]

Your time has expired, Mr. Dionne Labelle. Thank you.

For the final five minutes I'm just going to remind members that we are going into committee business in camera after this, so please stick around.

Now, for five minutes, Mr. Lake.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you, Mr. Chair.

To give credit where it's due, we talked about the “Stuff Edmontonians Say” video. It's been up for two weeks—321,000 views. It's Colin Priestner who put that up, and it does feature a couple of Edmonton Oilers and a CHED radio personality. It's a very, very popular video. Most people who have seen it would say it's pretty accurate in terms of the way it depicts things that Edmontonians say.

Getting to the substance of what we're talking about today, I want to talk a little bit again about this ephemeral rights issue, if we could. It seems the argument on the other side, from Mr. Dionne Labelle, is that it's nice to have money, so we should have it, basically. There's not a rationale that's based on any kind of principle or fairness principle here. It's just that we get the money and we should have it.

What we're trying to do here is create a system where yes, people do receive money and artists receive money for the things they actually create. That's what this whole bill is about. It's making sure that artists are able to be compensated for what they create.

The word “perspective” was used, I think, by Mr. Chenart. I would like to put a little perspective here. On the $64 million you talked about, which is paid for the performance right, you said that's an increase of 63% from about 2001. Is that accurate?

[Sylvie Courtemanche]

That's correct.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

So the economy has grown probably somewhere around 20% over that same time period, and yet you're paying 63% for the performance right alone. That seems pretty substantial. Obviously--

[Gary Maavara]

If I could interrupt, I should also add that on top of these funds, we also spend $50 million as an industry on development. That's going to the point about spending on development. That's over and above what we've already talked about.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

So then on top of that, you're spending 63% more. Even if there were no money in the technical reproductions, you'd still be spending 63% more than what was spent in 2001.

Can you just maybe speak to how those numbers come about? What is the process by which those numbers come about?

[Gary Maavara]

The tariffs are put before the Copyright Board and the board makes a determination. What's happened is that as the new rights have been introduced, they've been layered on top of the existing fees. The problem with the tariffs is they're a percentage of revenue, so that as our revenue grows, our cost grows. We all understand that. What's been happening is the tariffs have been layered on top of each other, and the result is that there's an actual incremental growth in the fees, which causes these numbers like 400%. That's why it's not sustainable.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

I find it interesting that you say as your revenue grows, your cost grows. Again, even just dealing with the performance right, the fees you pay for that, you say your revenue has grown by 41%, but your rights fee has grown by 63%. Again, that's without even adding on top the $21 million.

[Gary Maavara]

That's correct.

The spirit of the act was discussed earlier. The mechanical right, which we supported as an industry, was introduced to help combat piracy. At the time—it may have actually been in this room—when we said there may be a problem because they're going to charge the people who are paying for the music for copying it under this law, the music industry representative said, “We won't file a tariff. We'd be crazy to file a tariff.” The second the law changed, what happened? They filed a tariff.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

So just to clarify, how does that $21 million come about? Is that a negotiation between you and them? How did you wind up paying the extra?

[Gary Maavara]

It's a fee that's set by the board as a result of these multi-layered tariffs.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

So there's no negotiation at all. You're just basically doing it now—

[Gary Maavara]

If there were a negotiation, the system would probably be more efficient. Corus and the radio industry are immensely and massively supportive of artists in Canada. We do a lot. The question I put to this committee is that there are hundreds of millions of dollars going into the system, and if the artists aren't getting it, where is it?

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

I have very little time, so I'll finish up. I just want to clarify this one more time.

Even without the $21 million, the performance right is still 63% higher than it was ten years ago. I'd just like to be clear on that.

[Sylvie Courtemanche]

Just to give you a comparison, in the U.S. in 2008 the performance fee, as a percentage of total revenues, was 2.36%, and in Canada it's 5.8%. That just gives you an idea.

[The Chair, NDP, Glenn Thibeault]

Thank you, Ms. Courtemanche and Mr. Lake.

I want to thank the guests.

Thank you for your presentations.

We will suspend for three minutes, and we will say thanks, and then clear the room to move into committee business.

[Proceedings continue in camera]