Thank you, Madam Chair and honourable committee members. My name is Robert Malcomson. I'm senior vice-president of regulatory affairs at BCE. Thank you for your invitation to provide Bell's views on copyright reform that will help ensure artists and content creators are paid for the work they create.
Bell is Canada's largest communications company, employing 51,000 Canadians and investing $4 billion in advanced networks and media content last year. We're also a key supporter of Canada's cultural and democratic system, investing approximately $900 million per year in Canadian content and operating the largest networks of both local TV and local radio stations in the country.
As a content creator and major economic partner with Canada's creative community, we share an interest in protecting the economic model that supports our cultural industries. I look forward to sharing this perspective with you.
In our presentation today, we will focus on the impact of organized content theft. This issue is fundamental to the topic the committee is studying, because no matter what remuneration model you adopt, creators can never be fairly compensated if their work is being widely stolen.
There is an emerging consensus among creators, copyright owners, legitimate commercial users and intermediaries that large-scale and often commercially motivated piracy operations are a growing problem in Canada. Piracy sites now regularly reach up to 15.3% of Canadian households through widely available and easy-to-use illegal set-top boxes. This is up from effectively zero five years ago.
In addition, there were 2.5 billion visits to piracy sites to access stolen TV content last year, and one in every three Canadians obtained music illegally in 2016. Each of these measures has also grown significantly over time.
According to research conducted for ISED and Canadian Heritage, 26% of Canadians self-report as accessing pirated content online. TV piracy has an estimated economic impact in the range of $500 to $650 million annually.
In light of these concerning trends, we believe it is necessary to modernize the Copyright Act and related enforcement measures to meet the challenge posed by global Internet piracy.
To be clear, protecting creators in this way does not mean targeting individual Canadians who access copyright-infringing materials. Rather, it means addressing the operators of commercial-scale copyright-infringing services. It is these large infringing operations that harm the cultural industries, which employ more than 600,000 Canadians, account for approximately 3% of our GDP, and tell the uniquely Canadian stories that contribute to our shared cultural identity.
With all of this in mind, we have three recommendations.
First, modernize the existing criminal provisions in the Copyright Act. Criminal penalties for organized copyright crime are an effective deterrent that do not impact individual users or interfere with legitimate innovation.
The act already contains criminal provisions for content theft undertaken for commercial purposes, but they deal with illegal copying, while modern forms of content theft rely on streaming. These provisions should be made technologically neutral, so that they apply equally to all forms of commercial-scale content theft.
Second, increase public enforcement of copyright. In jurisdictions such as the U.K. and the United States, law enforcement and other public officials are actively involved in enforcement actions. We recommend that the government should create, and consider enshrining in the Copyright Act, an administrative enforcement office, and should direct the RCMP to prioritize digital piracy investigations.
Third and finally, directly empower either the CRTC or the courts to order intermediaries to contribute to remedying copyright infringements.
All players in the ecosystem have a role to play in promoting compliance with the rules that support the appropriate remuneration of creators. Early this year, FairPlay Canada, an unprecedented coalition of creators, broadcasters and other industry players, filed an application with the CRTC seeking to require Internet service providers to disable access to the most egregious piracy sites. Earlier this month, the CRTC recognized the harm being caused by piracy but determined it did not have the statutory jurisdiction to grant the coalition's application. This committee could recommend that the Telecommunications Act be updated to provide that jurisdiction to the CRTC.
In addition, a new provision could be added to the Copyright Act that would apply more broadly to intermediaries such as ISPs, web hosts, domain name registrars, search engines, payments processors, and advertising networks.
In practice, this would mean adding a section to the Copyright Act that allows a court to issue an order directly to, for example, a web host to take down an egregious piracy site, a search engine to de-list it, a payment processor to stop collecting money for it, or a registrar to revoke its domain.
While financial liability for these intermediaries is not appropriate, they can and should be expected to take these reasonable steps to contribute to protecting the integrity of copyright, which is essential to all remuneration models for creators.
Thank you for the opportunity to present our views. We look forward to any questions you may have.