Thank you very much, Madam Chair and honourable members, for this opportunity.
I am the president, founder and owner of Casablanca Media Publishing and Red Brick Songs, a leading Canadian-owned independent music publisher for 17 years based in Toronto, Ontario.
When I co-founded Casablanca in 2001 with my late business partner, Ed Glinert, we started with very little. Now, 17 years later, we have seven Canadian employees, and I'm proud to say that our organization is over 70% female. We control over 700,000 music publishing copyrights in Canada, 30,000 in the U.S. and 4,000 worldwide.
Some of the well-known songs that we are privileged to represent include Imagine, by John Lennon, What a Wonderful World, My Way, Despacito, Start Me Up, by the Rolling Stones, and even the theme to the The Simpsons. We represent almost every genre of music, including current hits and songs that have been recorded over the decades. We also represent brand new songs by Canadian songwriters that have yet to be recorded.
That is who we are, but, as my family always asks me, how do we actually make any money? Well, we do a number of things.
First of all, we administer or sub-publish music publishing copyrights, largely in Canada but also internationally, for other music publishers and for songwriters who control their publishing. This represents the majority of our revenue. In most cases, we don't own the copyright.
On a typical day, our team liaises with rights organizations like SOCAN and CMRRA, chases unpaid royalties, tracks income, processes monies we've received, talks to our foreign reps in the U.K. about an upcoming tour, or pitches songs to a music supervisor in Toronto or L.A. to be licensed in film or TV.
Second, we invest in the creation of new music-publishing copyrights, which we co-own with songwriters. As you can imagine, this is the riskier part of our business model. This is where we attempt to build a house in the air, if you will use that analogy, by bringing the best builders together, financing their training and their materials, guiding their designs and then hoping that someone will ultimately want to pay something to rent that house, because there is no land value on day one and maybe not even on day 1,000.
As music publishers, we both develop new songwriters and sign songwriters at more advanced stages in their careers. We become their personal cheerleaders, pseudo-managers and long-time business partners.
As an example, we signed the 22-year-old Tom Probizanski from Thunder Bay, Ontario, which allowed him to move to Toronto. We then paid for him to go to L.A. and Denmark to co-write, and we set up his co-writing sessions. We also arranged and financed his trip to Banff to speak on a panel and introduce him to the Banff World Media Festival audience. When he later released his latest EP under the name of Zanski, we paid for his blog and playlisting promotion so that he was featured in Clash magazine and EARMILK and various Spotify playlists.
For another songwriter, Dan Davidson, from Edmonton, Alberta, we've arranged co-writes in China and financed radio promotion, which led to a top 10 Canadian country radio hit.
For Jeen O'Brien, from Stratford, Ontario, we guided her and helped her secure J-Pop releases in Japan, as well as various placements in TV and ads for Capri Sun and Google.
Even with older well-known songs like Skinnamarink, which was made famous by beloved children's entertainers Sharon, Lois & Bram, we have continued to promote and extend the economic life of this song by securing a Bose ad in 2016 that aired worldwide and a book publishing deal with Penguin Random House to release a picture book in 2019.
We make these investments of money, connections, time and knowledge because we believe in our songwriters, we love what we do, and we hope that the combination of our connections and knowledge and their talent will equal success, financial or otherwise, but so often it doesn't, and the one radio hit pays for other developing songwriters. Likewise, the sub-publishing and administration side of our business pays for our investments in Canadian songwriters.
This is a risky business. It takes decades to build. As I said earlier with the house analogy, there is no land value for a song if the house is a teardown. You can invest in a songwriter and walk away with nothing.
This is why the music publishing business is a true business partnership with songwriters. One cannot succeed without the other. There is always a team behind a hit song, and the team is behind the scenes. A hit song is what allows publishers to keep investing in songwriters and building Canadian talent to export worldwide. Unfortunately, for both songwriters and publishers the amount of money being generated in the music publishing industry today is fractions of cents. One million streams might generate an average of, say, $300 in publishing royalties for a songwriter, and that's if the song has only one writer.
The transition from physical product to a digital world has been very difficult for songwriters and music publishers. Too often we found our music being used on a platform, and that platform profiting without compensating songwriters and publishers. We survived only because we had other revenue streams, such as royalties from radio stations and private copying royalties. Changes to the Copyright Act in 2012 created new exemptions that decreased the amount of these royalties just when we needed them the most.
Of course, as we continue to transition to a fully streaming world, the importance of royalties from radio stations and private copying cannot be overstated. It's not only about diminishing revenue for music publishers; it's also about increased costs. Besides the sheer volume of data publishers now have to process, the costs of identifying unpaid uses are significant. Claiming works on YouTube, for instance, is a full-time job and a great example of a service downloading its operational costs onto songwriters and publishers.
Meanwhile, creators are relying on publishers to collect this income and to reinvest this income in their careers. The Canadian economy is relying on small and medium-sized businesses like mine to provide full-time, stable jobs, but to survive in the music business today, independent music publishers like me need to be able to earn a reasonable return on our investment in creativity. The 2012 amendments to the Copyright Act have not made that easier. In fact, they have made that harder than ever, which makes your work here today that much more critical. The review of the act is an important opportunity for Canada to address the expanding value gap and to get things right for songwriters and publishers.
To do that, Parliament can take a few simple steps.
First, it can revisit the immunity afforded to ISPs, hosting services and other Internet intermediaries, who continue to profit from the use of music without paying their fair share to rights holders. Intermediaries should be required to act quickly and block access to sites that facilitate infringement by others. When an intermediary is a content provider and profits from the use of music directly or indirectly, the creators and owners of that music should profit too.
Then, it can amend the new and expanded copyright exemptions that have led to a dramatic reduction in royalties from radio and private copying over the last five years.
Finally, it can introduce clear processes and rate-setting standards for the Copyright Board of Canada. The board's unpredictable decisions have led to royalty rates for music streaming that are a fraction of the comparable rates in the U.S. and elsewhere.
I would like to take this opportunity to thank the government for agreeing to term extension in the USCMA. It benefits companies like mine and the songwriters we invest in, and we look forward to seeing this implemented as soon as possible.
Thank you again for the opportunity to appear.
