Canadian Heritage Committee on March 25th, 2010

[Megan Leslie, NDP, Halifax, NS]

Of course, we're going to hear from the major players and the no-names. But while we have you here, do you have some suggestions for us as to who wouldn't be on our radar here in Ottawa? Who are some innovative people we should be talking to?

[Prof. Michael Geist]

Well, I just mentioned a couple, and I'm happy later, certainly, to provide the chair or members of the committee with the names of the kinds of businesses we're seeing.

It is, of course, a fast-moving space. If there's one other kind of Canadian success story that perhaps you ought to be thinking about hearing about, it's the number of noteworthy successes that started in Canada and are no longer here. To give an example--I mentioned my younger kids, so I'll mention them again--there was a brief period of time when my kids were very into Club Penguin and Webkinz. People who have kids of the preteen set will recognize both of these. These are dominant players in the online space when it comes to kids' games. They are for the pre-Facebook set, so to speak. They are very, very successful. Webkinz is still a Canadian company, run by Ganz, so it's a great example of a Canadian company that has adapted to the online environment. Club Penguin is one that was bought out by Disney.

Why is Club Penguin now U.S.-owned? Why is StumbleUpon, which started up here, U.S.-owned? Why is Flickr? Think about the photography area. It is one of the dominant players when it comes to online photography. The dominant player now is Facebook, which has literally three billion photos posted every month. It's a staggering number, but Flickr has billions as well. It was started by Canadians and was, of course, bought out by Yahoo.

If we're going to talk about creating a national digital media strategy, we also ought to be talking about how we retain that Canadian success and talent in Canada. That's something I don't think we've spent a lot of time thinking about yet.

[Megan Leslie, NDP, Halifax, NS]

What's holding up the process here in Canada when it comes to having net neutrality enshrined in Canadian law?

[Prof. Michael Geist]

I actually think we have a better-news situation than perhaps we had, let's say, a year ago. I thought the CRTC hearings on net neutrality were quite good. I thought the guidelines the CRTC came up with were, in the main, pretty good as well. The fights you see taking place in the United States are largely around guidelines that could ultimately look much like what we have in Canada.

The issue, now that we have these guidelines in place, is whether we are going to have effective enforcement. I think the criticism about the net neutrality guidelines or the traffic management guidelines, from the very beginning, was about whether there was effective enforcement. We saw a baby step in that regard, so to speak, from the CRTC earlier this year when they took on the issue of disclosure. One of their requirements was that ISPs have to disclose their practices. ISPs are still not disclosing them in an appropriate fashion, and the CRTC wrote to the ISPs and said that it needs to change.

Even today we have all sorts of traffic management practices that I think are problematic and that need ultimately to be tested. We have those high-level guidelines, but what we need is actual enforcement to determine whether the guidelines can deal with some of these problematic policies. That's an answer we don't have yet and that's going to require some enforcement, something that I hope we see this year.

[The Chair, Conservative, Gary Schellenberger]

Thank you.

Mr. Rajotte, welcome to the committee.

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Thank you very much, Mr. Chairman. I certainly appreciate being here.

Mr. Geist, I always find it interesting to listen to you. Thank you very much for your comments here today.

I very much appreciated it when you talked about the silos of telecom broadcasting. I think you're fundamentally right on that. With respect to young people being active on copyright, I can say that's certainly true in my riding. I know a lot of people became active on Bill C-60 and Bill C-61.

I know you were quite a strong opponent of Bill C-61. Some people had the impression that you oppose any copyright measures. But as you've said this morning, you in fact support copyright policy in terms of implementing WIPO “notice and notice” of fair dealing. I appreciate those comments. I think you're recommending to the government that it be a smaller and more streamlined bill that's technologically neutral.

In the discussion on copyright, you also talked about creators and users. It's a real challenge in terms of the new online environment to ensure that creators are compensated for the work they do, including a person who writes a song, a producer, and all the way down the line for any field.

Could you comment on how to ensure that we actually compensate creators in the new online environment?

[Prof. Michael Geist]

It's a terrific question and a very important one. It's one that people have been grappling with for some time. In some ways, I'd divide my answer in two.

One of the ways that creators are compensated in the online environment is within the market. We have to recognize that new media doesn't require a complete collective government plan to ensure creators are paid in the online world in the same way they're paid in the offline world. In fact, I think many creators find tremendous opportunities within the online world. They're sometimes paid in the conventional ways. At other times, they're paid far more in different ways.

The stories of one-offs, such as Nine Inch Nails, Radiohead, and some other musicians out there, have become increasingly more commonplace as illustrations, in some instances, of giving away some of that intellectual property. You can use their work or have access to their work because they recognize they can make far more in other places. Policies that are designed to protect and hoard IP as much as possible can often miss the forest for the trees. If the goal is to maximize the type of revenue that can be generated, oftentimes providing it and giving it away can actually work quite well. I think there are great opportunities.

At the same time, there may well be another role. When there is a market failure, collective licensing often comes in. I think it is worthwhile talking about whether or not the collective licensing approaches that we now have in place will still work in the current environment. Frankly, before we begin layering in all kinds of additional fees, we need to ensure the structure is working appropriately. I'm not someone who says absolutely no to potential levies or new collective systems. I think they have a role to play, if the market really does break down, and they can provide a better alternative.

[James Rajotte, Conservative, Edmonton—Leduc, AB]

That's what I want to follow up on. In the past, there was an assumption that if people bought VHS tapes or cassettes, they would in fact be using them for recording purposes. They would be breaking the copyright, if you want to use that phrase, and a charge, tax, or levy should be charged.

There are new proposals coming forward on the copyright regime being extended to MP3 players, iPhones, iPods, cellphones, etc. Isn't it the wrong way to go to assume that if people are buying these products, they are in fact breaking copyright and should therefore pay a levy, tax, or fee?

[Prof. Michael Geist]

The issue is obviously quite politically charged in terms of the motion that came through this committee, as well as the private member's bill that we've seen. I think there's value in a private copying levy. I have some concerns with the proposals that have been put forward.

First, with all respect, it's not the people putting this forward, but it's those who are calling on elected officials to support a private copying levy who are being disingenuous. On the one hand, they say that a lot of copying is taking place and the creators need to be compensated. I think that resonates with people and it makes some sense, but we all recognize the kind of copying that's taking place is largely peer-to-peer copying. Yet, those same groups will turn around and say this isn't about peer-to-peer copying, but it's about other types of copying. It strikes me as not being completely honest.

If we're going to have a levy that actually addresses the real type of copying, let's have a debate. Let's establish a levy that makes some sense, doesn't create price distortions, which I think, with respect, this one does, and is not overly broad, which, with respect again, I think this one is. But nevertheless, let's at least have an open debate.

I think there's an attempt here to have one's cake and eat it too. On the one hand, we want all kinds of compensation for copying, including copying on new devices. At the same time, we persist in calling people who make those copies “pirates”. We can't have it both ways. If people are going to pay, let's have a levy that genuinely addresses those issues and where the copying is taking place. Let's not kid ourselves. This isn't about someone who buys a CD and copies it on an iPod. This is about dealing with peer-to-peer copying. Yet, the groups behind it persist in saying it's not about that.

[The Chair, Conservative, Gary Schellenberger]

You don't have any more time, Mr. Rajotte.

We'll go to Mr. Simms, please.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Thank you, Chair.

Thank you, Mr. Geist. It's good to see you again.

You and I have a similar pattern of trying to deal with this issue. You obviously are far more knowledgeable than I am, but we both have this habit of not only watching the content our children look at but of seeing how they look at that content.

I've a 15-year-old son. I've said time and time again in this committee and others that you can put in place legislation that cuts down on circumvention. It'll take about a year to do it. It'll take my son about 48 hours to get around it.

I've always been a fan of a point you made earlier: this is illustrative, not exhaustive. Are we going in that direction in the sense that the legislation we put in there mirrors what is happening right now in Europe? It says, look, these are the guidelines by which copyright is enforced. They create a more flexible system that not only, obviously, protects people's copyright but also allows fair dealing and allows people access so that they can further create beyond that.

How do Bill C-60 and Bill C-61 not do that, and how should we go towards that more flexible type? I completely agree with you on the WIPO treaty stuff. We're way behind, and it's a game of catch-up.

[Prof. Michael Geist]

In fact, I think you've put two issues on the table. You're talking both about anti-circumvention and about fair dealing, and both are, as I've said, critical issues that we have to deal with.

On the issue of anti-circumvention, I say again that we need to implement, if only because of the kind of political pressure we face from other countries and to at least send the message that we are trying to update. But as you've just noted, there's flexibility in how we go about implementing. We can be fully compliant with these treaties and still seek to preserve the kind of balance we have off-line in a digital world.

With respect to fair dealing and that move toward flexibility, in recent years we have seen other countries--Israel is a good example--move toward an exact U.S. fair-use approach. Now, I take the position that simply taking the U.S. provision is not the right way to go. There are those out there who would disagree with me...who are seen to be on my side of the fence on this; no, we want fair use.

I think it is a far better approach to recognize that we now have years of jurisprudence around fair dealing that emphasizes--

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

There's one that keeps popping up in your books; is it CCH and the Supreme Court?

[Prof. Michael Geist]

Yes.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Would that decision be a basis for our new copyright legislation, and do you think it should be?

[Prof. Michael Geist]

Yes, I think it should be.

The CCH case was a case that sounded a very strong signal that copyright is a balance, one of both creator rights and user rights, and it sought implementation and interpretation of copyright in that balanced fashion. I think that was the right thing to do.

I think what the courts have done on fair dealing is send a signal that this is a user right. It's an integral part of the Copyright Act, and it needs to be interpreted in a flexible fashion. But there are still limits. So the Canadian courts have established limits that say that it isn't a “free for all”, it is a “fair for all”.

I think building in that kind of flexibility achieves a number of things. First, it's consistent with what the court had to say. I think it actually provides great benefits to creators, users, and businesses that are trying to be innovative. It also addresses the issue that came up with the earlier question of why this is all taking so long or is taking too long. I think if we go to the sort of piecemeal approach with respect to fair dealing...

I think almost everybody will, at this stage, agree that we need to deal with parody. We need to deal with time-shifting and the recording of television shows. We could probably identify a half-dozen or so things that almost everybody would agree we need.

The reality is that the day after this legislation passes, there are going to be people coming up to you again saying that you didn't address their issue. We need this additional piecemeal thing, and we're going to spend a decade getting into those kinds of debates. A flexible, forward-looking approach says that we're not going to specifically define the categories, but what we are going to ensure is that we have fairness built into the process--fairness for both sides.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Is that where Bill C-61 went wrong?

[Prof. Michael Geist]

In my view, Bill C-61 went wrong in a number of places. That's one area where I think it went wrong. For example, it legalized the recording of a television show, but it came with 12 conditions. The conditions included things like only being able to keep it for a limited period of time. Only one person could see it. You could only record the show once, so you'd better not set your PVR to record all the episodes, because if it recorded a rerun, you would be in violation. And it was all subject to a digital lock at the end of the day.

On fair dealing, it went wrong by going both piecemeal and by making it far too restrictive, far beyond what the law would currently say fair dealing would be.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

It was far too exhaustive.

[Prof. Michael Geist]

Well, I think it made it virtually unworkable.

I think this is an important point. People often talk about the need for respect for copyright and claim that a whole generation today doesn't respect copyright. Well, I have to say that in some ways, it works both ways. A law that tells people that it is illegal to record a television show or that in order for it to be legal, you have to be able to tick 12 boxes, doesn't engender any kind of respect for copyright.

To create that kind of respect, we need forward-looking laws, but we also need a certain amount of trust among the public to recognize that we're going to treat them as adults and that this is the framework, and there's some flexibility built into that framework. Otherwise, people look at this law and say that this is just utter nonsense.

[The Chair, Conservative, Gary Schellenberger]

Thank you for that.

Mr. Pomerleau, please.

[Roger Pomerleau, Bloc, Drummond, QC]

Thank you, Mr. Chair.

Thank you for coming, Mr. Geist.

Clearly, we are at a very promising time with the advent of these technologies, a time when extraordinary prospects are open to us.

All the same, there are some people who are excluded from this process. I am thinking about people of my generation or of my father's who have great difficulties mastering the use of these systems. There are also people who, like me, live in isolated rural areas where they have no access to the Internet. These people are excluded and suffer the consequences.

I, myself, have been using a BlackBerry for a year and I must admit to its advantages. It is because we have immediate access to information allowing us to take immediate decisions. Those who have these tools obviously have an advantage over those who don't, especially when it comes to business.

So, while there are people who are excluded, there are also all those nation states who do not have access to these systems. How do you see the situation unfolding in the long term given the problem of people who are excluded?

[Prof. Michael Geist]

Sure. You've pointed to two kinds of digital divides, in a sense. You've pointed to a digital divide that is a skills digital divide, where it's sometimes based on just life experience, demographics, what have you. There are people who are deeply comfortable with this. I think again of my kids, or even my students and even more recent graduates, people now into their thirties and forties who have grown up with the Internet. We forget; we still talk about service...in some ways it's early days. But anyone who, let's say, entered high school or even middle school from the mid-1990s or before, 15 years ago, almost 20 years ago, can scarcely remember a world without the Internet, and certainly not one without the personal computer. As time moves on, more and more of the population here and elsewhere have those skills and have that comfort level.

That said, the question was posed earlier about a digital strategy and I think skills development, digital literacy, has to form a part of that as well. It's not just about ensuring that we have the network. It's also about ensuring the kind of comfort level both for people who are coming into the workplace, but especially for people who may be transitioning between jobs and the like. We have to address that kind of issue. In fact, the controversy or the mistake a week or so ago around the community access program...where the government is funding support in many communities, in thousands of places, often in libraries. That actually serves as a prime place for many people to get those kinds of skills and education. I think it's an important program and I'm glad the funding continues for that.

In terms of the rural-urban divide, you're absolutely right. This is an issue we've known about and have been grappling with for a long time. I think at this stage we surely must come to the recognition that even left solely to the market--and there are obviously incentives for the large telecommunications and cable companies to try to ensure that as many people are wired as possible--there are still going to be have-nots. Saying that wireless technology solves this problem I don't think is right. I don't think the speeds offer the kinds of capabilities that are necessary for things like lifelong learning, for a range of new services, for some of the health services that we're going to start seeing happening. I don't think satellite works either. I think anyone who thinks satellite is an effective alternative should be required to use it, and then we'd see just how effective it is as an alternative.

There is unquestionably a role to play for government to ensure that there is no community left behind. Decades ago we talked about universal service and we thought of universal service in the context of the telephone. Universal service today ought to mean broadband.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Let me return to the issue of iPod levies. As you know, it is I who submitted the motion here at this table, who has tabled it and had it passed. Among other reasons, I did so because artists must be paid for their work. When you say that this is not a serious problem because if they are not paid for recorded music, they will be for their public performances later on, this makes me very uneasy. It's like having a university professor who works for nothing because we expect him to be paid for his conferences outside of the classroom.

This seems unjust and makes no sense. Clearly, even with an iPod levy, artists would not entirely recover their losses even if we don't expect that to happen. This is because much of the musical works downloaded on iPods are done so legally but there still is all the other possibilities available through MP3--

[The Chair, Conservative, Gary Schellenberger]

We need a question quickly, because we're already at five and a half minutes. And I'll need a short answer.