Industry Committee on May 8th, 2018

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

I mean audiobooks specifically—from 16% to 37% from 2015.

[Richard Prieur]

I can't really answer that because French-language audiobooks aren't that popular in Quebec. The decline in digital book sales, however, can be explained in a number of ways.

There was a big appetite for digital books when e-book readers first came out, in other words, tablets, iPads, Kindles, Kobos, Sony Readers, and all the rest. People discovered these devices and got into digital reading through the hardware.

That appetite then eased off. At that point, ANEL did something that the libraries will probably recognize. Quebec publishers, together with other players in the book chain and public libraries, introduced the concept of digital book lending at libraries. All of a sudden, we saw a phenomenal increase in digital book sales, as far as our catalogue went, with every public library in Quebec purchasing digital books. The flip side was that it hurt digital book sales going forward, because people could, of course, access the books for free at their library.

The other problem when it comes to digital books is the lack of data. BookNet Canada does have some data, but the big players in the digital world, the multinationals such as Amazon and Kobo, are extremely reluctant to share their figures, so that makes it pretty hard to determine actual market penetration, at least in the French-speaking population.

As I mentioned earlier, the OCCQ estimated that new book sales represented $600 million, putting digital book sales in Quebec at $7 million. That number, however, is based solely on digital book distributors in Quebec and accounts for a small fraction of the total. All that to say e-books are not as popular as you might think.

As I said, though, piracy is rampant in the world of digital books, which are shared freely on websites like Facebook. We thought the act would help combat that phenomenon, but, quite the opposite, piracy has continued to rise. We contacted the RCMP to see what recourse we had, but the force told us it was completely powerless to deal with the problem. We understand the challenge it represents. The fact of the matter is there is no real front line to address the issue.

Why isn't the digital book market thriving? Why are sales dropping? Because people can easily access digital books for free, whether it's a pirated version or an e-book at their local library.

[Benoit Prieur]

I'd like to say something quickly, if I may.

In response to a member's question earlier, Richard Prieur talked about the change in book sales in Quebec. There is no denying that sales have declined. Richard said that sales had dropped by 25% over the past decade, and that is true. The increase in digital book sales has slightly offset the drop in print book sales.

For the purposes of today's discussion, it's important to note that textbook sales are down the most. By that, I mean books normally purchased by elementary and high schools, as well as colleges and universities. That's the market that has been hit the hardest.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

Mr. Masse, you may go ahead. You have seven minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair. Maybe I'll carry on with that discussion.

Generally speaking, the testimony we have received over the last number of weeks in Ottawa and Halifax has been that there has never been a time when universities and others have purchased more. They claim that there has been more spent than ever before.

Now, I know for a fact that the cost of tuition and education has not gone down; actually, it has disproportionally gone up, when you look at the cost of education over this period of time.

Putting that aside, you also have artists who have come to us since that time saying that their revenues are down quite significantly. Last night's testimony in Halifax was that people are losing up to two-thirds to sometimes four-fifths of their royalty income.

We have these kinds of imbalances here. Where do you think the money is going? Or are we—maybe not intentionally—being misled? What is happening? We are being told consistently that purchasing is way up, production is still there, and artists are getting less.

Does anyone want to take a crack at this?

[Richard Prieur]

I kid you not when I say that a lot of money has stopped going to creators and authors, whether in the book or music industry, because it's going to those making the hardware, in other words, technological devices.

Some colleges have opted to give every student an iPad. Schools have also begun incorporating digital interactive whiteboards into classrooms. I believe Quebec's education ministry spent more than $200 million on interactive whiteboards and $40 million on educational content. Educational content is akin to literary materials, if you will. What is happening in today's society is that money is being invested in technology, whereas, in the past, that money would have gone elsewhere. When I was in college and university, I read print books. We didn't have iPads or computers. Seeing where I landed in life, you might say it didn't make much of a difference, anyways—that time, I was kidding. At the end of the day, huge sums are being put towards technological devices and equipment, what I like to call hardware.

I can appreciate why universities, colleges, and schools lament how expensive it is. I think that if the government were to really look at where education dollars are going, it would probably find that less and less was going to authors while more and more was going to the Apples of the world. That's a reality.

I'm not sure whether you have any college-age children, but I think they all get an iPad now, don't they?

[Brian Masse, NDP, Windsor West, ON]

Actually, they're in grade schools.

[Guillaume Lecorps]

I'd like to pick up on that point.

All sorts of things are being said, and I think the gentleman raises a very good point. Where is the money going?

Frankly, the Quebec Student Union finds it a bit odd that the decline in book sales is being used as an argument. Although we realize book sales have dropped nationwide, we object to the claim that the decrease is a result of the fair dealing provision. There's no causal link between the two. Mr. Prieur, himself, admitted that the 25% drop in sales occurred over a 10-year period, so, beginning in 2008. The current iteration of fair dealing was not introduced until 2012. On that basis alone, the so-called causal link starts to crumble. We find it strange that it is being held up as an argument.

I'd also like to respond to what Richard Prieur said about Canada being a bad example. In my experience, multiple countries don't tend to follow in the footsteps of one that is setting a bad example. The claim that others systematically, or very often, follow a bad example strikes me as odd. I'd like an explanation of what exactly constitutes a bad example.

In addition, I'd like to respond to the comment that the cost to students is really peanuts. That point was made earlier. The fact of the matter is that universities are spending more and students are paying more. Students are concerned. The Quebec Student Union wants to make sure the new act doesn't create a distorted Robin Hood scenario, in other words, stealing from the poor—students who are struggling financially—to give to other groups who are experiencing hardship. That would be counterproductive.

Thank you.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

[Nicolas Sapp]

I can speak from the university perspective. In terms of print versus digital books, the statistics show a 50% drop in print book lending in university libraries across Canada, so Concordia University is not the only institution where that's happening. Consider this: 500,000 print books were loaned out, as compared with 23 million downloads.

The figures clearly show a major trend, which, as you know, is affecting every sector of the economy, not just education. The book industry is merely one of many going through the shakeup.

[Brian Masse, NDP, Windsor West, ON]

I will be really quick. Overall has it been a positive or a negative? I'm going to come back. I'll have two minutes later.

We're at a point right now where we're probably just reviewing things. Has the situation gotten worse or better for your prospective industry since the new legislation has come into play?

[Richard Prieur]

You'd like to know what the worst effect on the book industry has been?

Mr. Lecorps said some rather surprising things. Benoit Prieur talked about a 10-year period, I believe. I, however, look at the numbers and—

[Brian Masse, NDP, Windsor West, ON]

Sorry, we have one minute to go across. I will have more time later to pursue that.

[Guillaume Lecorps]

Can you repeat the end of the question?

[Brian Masse, NDP, Windsor West, ON]

Student debt has just gone up anyway, so is the situation better or worse? We're looking at copyright changes, so have things gotten better or worse?

[Guillaume Lecorps]

Since the fair dealing provision for the purpose of education was introduced, we've seen the quality and quantity of the sources available to students on campuses go up. That means greater access to knowledge and expertise, which is very much in line with the trend in 2018 towards greater participation in the knowledge-based economy. We are talking about an improvement in both the quality of materials and access to them.

[Benoit Prieur]

As an author, I receive royalties from Copibec, and those royalties have decreased over the past five years. Is my situation typical of the overall reality? I don't know. I do think, though, that, on the whole, writers and publishers are worse off now.

[Nicolas Sapp]

From the university standpoint, eliminating the fair dealing provision would be the worst case scenario. We would like to see the principle upheld.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

Ms. Ng, you have seven minutes. You may go ahead.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you, Mr. Chair.

I'd like to thank the witnesses for meeting with us today.

I'll be asking my questions in English.

Thank you, everybody. I'm going to pick up on the questions my colleagues have asked. The work of this committee will, ultimately, at the end of this, come up with some recommendations on a perspective dealing with copyright legislation, but we've heard a number of things.

We've heard from universities that the copyright legislation has been helpful to enable greater access for their students. We've heard from students and educators that they appreciate having limited access to a wide range of works, so they can provide that to students to enable learning.

We heard that copyright elsewhere and back here is paying less to authors. We certainly have heard from content creators and from authors that their revenues have come down, and from individual publishers that some of their revenues have also gone down. Yet, from a trends standpoint, we've heard that overall revenues have not.

There are gaps here in this particular understanding. We're trying to understand to what extent the act has aided in that, and from where some of those solutions might come.

Yesterday, when we were in Halifax, we heard in testimony that a platform technology could exist out there that would help enable revenues, based on titles and so forth, to go to individual authors on a per chapter basis. That may also help publishers, because those then become transactional licences.

I'm curious. With the advent of technology, and the need for students and young people to learn, and for creators to continue to be incented to create, do people see that platform technology as a solution at all?

[Richard Prieur]

We can hardly be against technological and scientific progress. There is evidence that new teaching and instruction methods can be effective, as well as new teaching techniques. Keep in mind, however, you're talking to someone who represents people who earn their living by selling their intellect and producing intellectual content. I'm not against the use of technology and digital platforms. I'm not at all against that. All I am saying is that the people who essentially supply the content for those platforms should be fairly compensated. That's all. There's no other answer I can give you.

From my experience, income is down, and if publishers have less income, then authors have less income.

I can appreciate that money is being invested in new teaching methods, scientific advances, technology, and innovative solutions. Innovation is the very reason for this committee, for that matter. The fact remains that you still need raw material to start with. In order for a book to exist, someone has to write it; someone has to conceive of it. Authors have to take the time to reflect on the subject matter. We are talking about books, but the same is true for music. In the music industry, you have songwriters.

If you take money away from creators, clearly, they won't be happy. Since they are already struggling, they will be less than pleased. You will end up with educational content that is sourced left and right—all over the place, really—thanks to freely available material on such sites as Wikipedia, without any real educational oversight or quality control. Then, you will wonder why flimsy educational content is being used to shape the minds of tomorrow's youth, when that educational content used to be supplied by a serious industry that promoted knowledge and academic development. Pedagogical science is becoming a Chinese buffet of sorts. There you have it, my heartfelt appeal.

[Guillaume Lecorps]

The elements highlighted by Mr. Prieur echo the considerations covered in our analysis. Tomorrow's youth also has projects. What you suggested in terms of innovation is consistent with what I was suggesting in my opening remarks regarding open education resources.

As we saw earlier, there is an increase in consumer spending and a drop in authors' revenues. We think that one of the solutions is to potentially bring consumers and authors closer together. The idea is to connect content creators with consumers. How would that be possible? Open education resources, for example, can be a publicly funded initiative that promotes the creation of content and makes that content directly accessible to consumers. That would foster accessibility to content and compensate, through public programs, the resources that are created. That way, content can flow and educational materials can be adapted to the language, the various learning realities or the country's distinct populations.

So there are initiatives that follow the 2018 trends. They will help us highlight projects that I sincerely believe will bring the author and the consumer closer together.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Do you have examples?

[Guillaume Lecorps]

There are pilot projects, one of which is currently under way in British Columbia. Unfortunately, I cannot really tell you about it because it is not taking place in the province we represent.

We have heard that Ontario was starting to implement such a project. That is something we are also pushing for in Quebec. We would like to see it implemented. There are also some projects at the federal level. Those kind of projects are starting to emerge as pilot projects. That seems very promising so far, especially in British Columbia, where the findings currently seem to be relatively compelling.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you very much.

Do you want to add anything, Mr. Prieur?