Bill C-32 (40th Parliament, 3rd Session) Committee on Dec. 8th, 2010

[Jason Kee]

This is actually good; it highlights the tension, because this is the exact concern that we have. The proposal to link circumvention and infringement means that the example that I provided means we would never be able to pursue that. What we're going to find is those who are offering circumvention devices and services, at least the smart ones, are going to quickly distance themselves from any act of infringement. What happens is you're never going to be able to establish that the person engaged in the offering of services, the actual act of circumvention, actually had actual knowledge that it was being done for infringing purposes. From an efficacy standpoint, it basically renders the provisions literally useless for the purpose of enforcement.

[Spencer Keys]

Would that be the case for your industry? Sorry about the back and forth, but would that necessarily be the case? How many situations are we talking about where there's a fair dealing right to...? I don't know how much of a fair dealing right there is to playing Halo.

[Jason Kee]

The issue, again, is I think you need to look at the entire range of exceptions that are available under the act. So the issue is not just a fair dealing; is there any kind of non-infringing use that they can claim to fall under? That's what they would be pushing for.

[Spencer Keys]

Yes, and I guess that's our point. That's where CCH has shown there's a balance that can then be struck by the courts. It's not simply an assertion of a fair dealing right that exists. It's something a lot more complicated than that.

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

I"d almost like to let this go for the next 20 minutes and just let the two of you debate.

I do have a couple of things. I would like a clarification on where Mr. Garneau was going earlier regarding Access Copyright. It's my understanding that Canadian schools pay in excess of $20 million per year to Access Copyright, and Bill C-32 does not change that--I don't believe.

[Zachary Dayler]

Access Copyright currently has a levy in front of the government right now to increase that fee.

Pardon?

[Dean Del Mastro, Conservative, Peterborough, ON]

Dramatically.

[Zachary Dayler]

Yes. The changes are being proposed.

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

The fact of the matter is that Bill C-32 doesn't change the $20 million plus that is already being accessed by Access Copyright, I guess, in a sense.

Secondly, is there any indication on fair use and the use of fair use in the U.S.? How might that have impacted the American publishing industry?

[Spencer Keys]

We have a report here that we can certainly circulate to the committee.

You're talking about something in the order of $4.4 trillion in revenue--accounting for a one-sixth total of U.S. gross domestic product, employing 17 million workers--attributable to fair use industries in the United States. This is a 2010 study.

That's grown substantially since it was last done in 2006, and certainly we can circulate that to the committee afterwards.

[Zachary Dayler]

To follow up on that, it talks about fair use economies and it outlines that those types of industries would be manufacturers of consumer devices, educational institutions, software developers, Internet search, and web-posting providers. They have all seen an increase in terms of employment, in terms of revenue, and in terms of what they're able to do as a business and grow.

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

Speaking of employment and revenue, I'm going to transition to Ms. Parr and Mr. Kee.

How big a player is the Canadian gaming industry worldwide?

[Danielle Parr]

Canada has the third-largest video game industry in the world. If you think about that on a per capita basis, it's especially impressive. These are the kinds of jobs I think that Canada wants in terms of our future, our digital economy. These are jobs of high value, high pay, and high skill. The average salary of a video game developer in Canada is $68,000.

So these are really valuable jobs. We may be large corporations, but there are also small independent developers and a variety of different businesses across the country. I think you're huge players on the world stage.

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

One of the challenges that we've had before the committee is a discussion about how badly we really actually want to pass this legislation. I know that, from a government standpoint, it's critical that we move the legislation forward. I think we as a committee really hold the future of the legislation in our hands. We will pass it or not pass it based on decisions this committee makes in terms of how much effort we're going to put towards it.

How critical is it to all of those jobs that you're talking about, to that economic impact, that we pass this legislation?

[Danielle Parr]

In our view, this bill is critically important to our industry and to the continued growth of the intellectual property businesses in Canada, in general. I think it speaks to the government's commitment to intellectual property and the digital economy. We feel that this legislation is essential, and we really strongly urge the committee to pass it quickly.

We're very concerned. I think everyone has heard rumours about a possible spring election, and we're deeply concerned that this bill might die on the order paper for a third time.

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

Mr. Keys, you are nodding. Do you want to comment?

[Spencer Keys]

Certainly we think that the education provisions are incredibly important. And this is certainly a positive new step in the long history around copyright. We would not want that to die on the order paper either.

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

Right.

I have one last question for you, Ms. Parr and Mr. Keys. You were talking about the importance of legislation. I want to hear a little bit more specifically about the TPM measures. Obviously, you have fairly strong feelings about the technical protective measures. Why are they so important? Maybe you could use some specific examples to help Canadians understand, when they're looking at this, why it's so important that they remain a part of this bill.

[Danielle Parr]

From our industry's perspective, our revenue is from the sale of our intellectual property. The one thing I'll emphasize for the committee is that, again, the new technologies and the new business models emerging now--the streaming services, the online subscription services--all depend on TPM. So it's not just about CDs and format shifting. If you think about the video game industry, Electronic Arts has said that 50% of their business next year is going to be digital downloads.

We have to think beyond the current context and be forward-thinking in terms of how the technology will evolve in the coming years. TMPs are critically important to these new business models. They create more choice for consumers, lower prices, and more flexibility. New business models let people develop a range of different types of products to suit different types of consumers.

I can't underline enough how important TPMs are in creating the ability for businesses to make the decisions themselves. That's why you need strong protection in the law so that people can choose and the market can decide whether a business model is viable.

[The Chair, Conservative, Gord Brown]

Thank you very much.

Mr. McTeague, you have five minutes.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Thank you, Chair. I realize the time constraint we're under.

I thank the witnesses for being here.

I might actually pick up, Mr. Keys and Mr. Dayler, from where you left off, given the shortness of time. There was a suggestion you made earlier that collective organizations can get access to the courts to find appropriate remedies. You're not suggesting, then, that we make a cottage industry for more lawyers, are you?

[Spencer Keys]

I'm suggesting that the industry already exists.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Beyond that, though, in all seriousness, the question of defining what is fair, I think for many people, from this perspective, would be seen as an exception. It doesn't mean a fair dealing right.

I think the approach you're taking leaves one with the impression that the sky is the limit and that you might actually be suggesting that we could be copying, each and every one of us, every page of War and Peace, for example. Is this in fact the position you're taking?

[Zachary Dayler]

If I may, education is changing. The realities are changing. Distance education is becoming more important. How students use media--through presentations, through incorporating snippets from it, and so on--is where education is going and what in-classroom is teaching.

Obviously, students already pay for access to materials through their fees. Our concern is the double-charging of students now for articles in media that currently exist and that they can access. A faculty member printing out full copies of War and Peace would find it rather expensive. But should that faculty member have the ability to take portions of that novel and provide that to their students in study? Absolutely.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

We were kind of hoping it would be copies of Hansard, but I digress.