Industry Committee on May 8th, 2018

[Brian Masse, NDP, Windsor West, ON]

I think I see things differently in general terms. As a representative for over a decade, I've witnessed about $10 billion in revenue come into the government from the spectrum auction. In fact, in 2014-15, approximately $7.4 billion alone came from sales at spectrum auctions. The spectrum auction is a public asset. It is no different from our land. It is no different from our water. It is a source of revenue for the general public.

We've had an unprecedented amount of money come into the public realm. Since that time, how much of that has gone to the artistic and creating communities? I think the television fund is a good example of something that was created before. From the spectrum auction, how much benefit do you think artists have received from this public investment that we've had, from the public revenues coming in, as we've seen them struggle going through the digital age and its emergence?

What we're hearing quite clearly, even from testimony in the publishing industry, is that, as we move online, creators are not receiving that money, whereas there seems to be billions of dollars for this oligarchic approach internationally, and there are revenue streams, not only just for the government, but also for others, that are unprecedented.

What have you got from maybe a decade of $10 billion of public money coming in?

[Pascale St-Onge]

We haven't had a penny in terms of journalistic information. Until the last federal budget, the government did not subsidize, or barely subsidized, print media. On the television side, the production of entertainment programs is subsidized—we're talking about independent television production—but in the case of news broadcasts, it is the general-interest television stations that assume the cost. It's obvious from where we stand that we haven't had our share.

[Patrick Curley]

As a music publisher, we have a small subsidy from a program called Music Entrepreneur Component, which I believe is partially supported by that particular fund. I know there's more support on the recorded music side, but I'm really not able to comment in any kind of detail.

[Martin Lavallée]

I think you're talking about what we call the value gap. We use this term in the digital world, particularly in music, but in other areas as well. You talked about oligarchy, individual actors who generate a lot of income by taking advantage of assets, in this case creation, belonging to others. But this wealth is not shared. It is not shared at all in the case of journalistic information—that's what I understand from what Ms. St-Onge said—and the sharing is not necessarily significant in the case of music publishing. This is why we're talking about a true sharing or a real distribution of wealth.

The witness who represented the Union étudiante du Québec talked earlier about taking from the poor to give to the poor. But I think it's a false debate. Indeed, we are talking about situations where someone specifically uses the property of others and the fact that there should be a wealth-sharing system that would involve users for the benefit of others. What surprises me is that the student, generally speaking, is a beneficiary, a user, a user of the work belonging to others.

With your permission, I will turn the floor over to Mrs. Morin.

[Annie Morin, Coalition for Culture and Media]

Good afternoon. My name is Annie Morin. I also represent the Coalition for Culture and Media.

Mr. Masse, if I'm not mistaken, you're referring to spectrum auctions and the amounts that result from them. You asked if money had gone to the creators and artists, since billions of dollars were generated by spectrum auctions.

The answer is no.

[Brian Masse, NDP, Windsor West, ON]

It's an unprecedented amount of revenue that has been collected in such a short period of time.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

We'll continue with Ms. Ng, who has seven minutes.

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

Thank you all for being here today.

I will ask my questions in English.

Thank you very much for coming in today and talking to us.

Each of you separately had talked about how there are too many exemptions and how there needs to be some clarification. Can each of you tell me which ones?

[Martin Lavallée]

I would tend to say that it's all about them.

This comes back to a point I raised earlier: at the root, we must ask ourselves what the primary function of the act is.

It would be a trap to ask ourselves what a nice balance would be and to decide to reduce the 70 exceptions to 30 so that everyone is happy. I don't think that's the heart of the matter.

We want a fair and balanced copyright law, of course, but one that also protects authors, publishers and producers, all rights holders.

If our mentality is that we have a basic right and that then,

we do a whole bunch of carve-outs,

it does not reflect the political will to have strong legislation.

As I explained to Mr. Jeneroux, strong legislation will then allow for negotiations on equal footing, regardless of the players involved. We don't want to give one an advantage over the other. Essentially, the situation must be clear, as you said about the time that the board can take to make its decisions.

You asked which ones, and I listed the ones that were technology-specific. The legislation should be neutral. Why are there specific exceptions to one technology over another?

Basically, copyright is quite clear: a reproduction right, a communication right or a right of first publication relates to recordings, producers, neighbouring rights or copyright. Then there are a host of exceptions that I think should be reviewed. Do we really want to take away rights and weaken the basic protection position that allows creators to negotiate? Shouldn't we review everything, reaffirm the right at the grassroots and then discuss a public right?

I think this choice should be left to creators and rights holders. It shouldn't be imposed by a legislative instrument.

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

Mr. Curley, is that what you meant? Is that a solution where you say we need to give creators the tools to be able to negotiate and to defend themselves?

[Patrick Curley]

Yes, absolutely. Again, all these exceptions collectively put the creators and their representatives in a poor negotiating position when you're dealing with multi-billion dollar companies. They are tough negotiators. That's probably a polite way to put it.

It's tough to be negotiating with such a large entity when at the best of times we're relatively small players in the greater scheme of things. At least if you come to the table with all the tools in your tool kit that you need to negotiate the best possible advantages, that's the kind of situation you want to be in. Each one of these exceptions is a leak in the boat, if I can put it that way.

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

Let me understand. If I heard you correctly, creators create their works and through the web giants and the various tools—Facebook, YouTube, Google, etc.—they utilize the content in a whole bunch of different ways. What you're asking us to look at is a way, a method, so that there is some revenue that's negotiated that goes to the content creators, because right now those avenues are where the advertising is going. All that advertising is going thataway and nothing goes to the creators, and you're saying to find a method by which some of that, in some negotiated way, would go back to the creators. Is that what I understand—

[Patrick Curley]

I'll give you an example. If you introduce an exception for user-generated content because people want to publish cat videos and then you've got an entity that's making billions of dollars because eyeballs have gravitated this way, basically what the exception does from a collective industry kind of situation is collectively we've lost the ability to negotiate that as a business model, because it's become a business model. Basically, Google and YouTube have turned it into a business model, but we've told Canadian creators that they can't have their piece of it. That's basically what this exemption comes down to.

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

I'd like clarification on your point earlier. I can't quite re-describe it, but you said that the Americans are able to compensate the content creators and Canadians couldn't. Could you just clarify? Do you know what I'm talking about?

[Patrick Curley]

Basically, the copyright rules are different. The details of copyright law are different in the U.S. If you're negotiating a deal under U.S. jurisdiction, you're going to be following U.S. copyright law. So it's essentially what I'm saying. These are nuances that have allowed us to generate royalties for this particular type of royalty, which is generating, again, not as much as it should, but it's something, whereas in Canada that basically didn't exist for many years.

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

Do you have data on that, which you could provide to the committee, which would sort of show that in an identical situation there is revenue in one jurisdiction and we don't have it, and the cause of that—

[Patrick Curley]

Well, I can tell you just off the top of my head. It's like six figures of revenue that we get from the U.S. and it's zero in Canada, on an annual basis.

[The Chair, Liberal, Dan Ruimy]

Could you forward that to the clerk?

[Patrick Curley]

Yes. Okay.

[The Chair, Liberal, Dan Ruimy]

The important part is that whatever comes out as testimony actually gets included in the report. If it doesn't come in testimony, we can't include it in the report.

[Patrick Curley]

Well, I can get you some figures.

[The Chair, Liberal, Dan Ruimy]

You could submit it as a brief or even as one-page document.

[Patrick Curley]

Okay.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

Mr. Lloyd, you have five minutes.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Thank you.

Thank you for showing up at the panel today. I appreciated the testimony. My first question is for Monsieur Curley.

As a musician and a businessman, can you comment on the experiences of your American colleagues and their interactions with copyright as distinctive from your experience in Canada? Is it better, and if so, why?