Evidence of meeting #143 for Industry, Science and Technology in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was works.
A video is available from Parliament.
3:30 p.m.
Liberal
The Chair Liberal Dan Ruimy
Welcome, everybody.
Can you feel the excitement in the air? I'm not talking about Christmas. We should all be excited now. This is the second-to-last witness panel on copyright—
3:30 p.m.
Voices
Oh, oh!
3:30 p.m.
Liberal
The Chair Liberal Dan Ruimy
Welcome, everybody, to the Standing Committee on Industry, Science and Technology, meeting 143, as we continue our five-year statutory review of copyright.
Today we have with us Casey Chisick, a partner with Cassels Brock & Blackwell LLP; Michael Geist, Canada research chair in Internet and e-commerce law, faculty of law, University of Ottawa; Ysolde Gendreau, a full professor, faculty of law, Université de Montréal; and then, from the Intellectual Property Institute of Canada, we have Bob Tarantino, chair, copyright policy committee and Catherine Lovrics, vice-chair, copyright policy committee.
You'll each have up to seven minutes for your presentation, and I will cut you off after seven minutes because I'm like that. Then, we'll go into questions because I'm sure we have lots of questions for you.
We're going to get started with Mr. Chisick.
I want to thank you. You were here once before, and you didn't get a chance to do your thing, so thank you for coming from Toronto to see us again.
3:30 p.m.
Casey Chisick Partner, Cassels Brock & Blackwell LLP, As an Individual
I'm happy to be here. Thank you for inviting me back.
My name is Casey Chisick. I'm a partner at Cassels Brock in Toronto. I'm certified as a specialist in copyright law and I've been practising and teaching in that area for almost 20 years. That includes many appearances before the Copyright Board and in judicial reviews of decisions of the board, including five appeals to the Supreme Court of Canada.
In my practice, I act for a wide variety of clients, including artists, copyright collectives, music publishers, universities, film and TV producers, video game developers, broadcasters, over-the-top services and many others, but the views I express here today will be mine alone.
I want to begin by thanking and congratulating the committee for its dedication to this important task. You've heard from many different stakeholders over the course of many months, and I agree with many of their views. When I was first invited to appear last month, I planned to focus on Copyright Board reform, but that train has now left the station through Bill C-86, so I'm going to comment today a bit more broadly on other aspects of the act. I will come back to the board, though, toward the end of my remarks.
On substantive matters, I'd like to touch on five specific issues.
First, it's my view that Parliament should clarify some of the many new and expanded exceptions from copyright infringement that were introduced in the 2012 amendments. Some of those have caused confusion and have led to unnecessary litigation and unintended consequences.
For example, a 2016 decision of the Copyright Board found that backup copies of music made by commercial radio stations accounted for more than 22% of the commercial value of all of the copies that radio stations make. As a result of the expansion of the backup copies exception, the Copyright Board then proceeded to discount the stations' royalty payments by an equivalent percentage of over 22%. It took that money directly out of the pockets of creators and rights holders, even though the copies were found in that case to have very significant economic value.
In my view, that can't be the kind of balance that Parliament intended when it introduced that exception in 2012.
Second, the act should be amended to ensure that statutory safe harbours for Internet intermediaries work as intended. They need to be available only to truly passive entities, not to sites or services that play more active roles in facilitating access to infringing content. I agree that intermediaries who do nothing more than offer the means of communication or storage should not be liable for copyright infringement, but too many services that are not passive, including certain cloud services and content aggregators, are resisting payment by claiming that they fall within the same exceptions. To the extent that it's a loophole in the act, it should be closed.
Third, it's important to clarify ownership of copyright in movies and television shows, mostly because the term of copyright in those works is so uncertain under the current approach, but I disagree with the suggestion that screenwriters or directors ought to be recognized as the authors. I haven't heard any persuasive explanation from their representatives as to why that should be the case or, more importantly, what they would do with the rights they're seeking if those rights were to be granted.
In my view, given the commercial realities of the industry, which has dealt with this for years under collective agreements, a better solution would be to deem the producer to be the author, or at least the first owner of copyright, and deal with the term of copyright accordingly.
Fourth, Parliament should reconsider the reversion provisions of the Copyright Act. Currently, assignments and exclusive licences terminate automatically 25 years after an author's death, with copyright then reverting to the author's estate. That was once standard in many countries, but it's now more or less unique to Canada, and it can be quite disruptive in practice.
Imagine spending millions of dollars turning a book into a movie or building a business around a logo commissioned from a graphic designer only to wake up one day and find that you no longer have the right to use that underlying material in Canada. There are better and more effective ways to protect the interests of creators, many of whom I represent, without turning legitimate businesses upside down overnight.
Fifth, the act should provide a clear and efficient path to site blocking and website de-indexing orders on a no-fault basis to Internet intermediaries and with an appropriate eye on balance among the competing interests of the various stakeholders. Although the Supreme Court has made clear that these injunctions may be available under equitable principles, the path to obtaining them is, in my view, far too long and expensive to be helpful to most rights holders. Canada should follow the lead of many of its major trading partners, including the U.K. and Australia, by adopting a more streamlined process—one that keeps a careful eye on the balance of competing interests among the various stakeholders.
In my remaining time, I'd like to address the recent initiatives to reform the operations of the Copyright Board.
The board is vital to the creative economy. Rights holders, users and the general public all rely on it to set fair and equitable rates for the uses of protected material. For the Canadian creative market to function effectively, the board needs to do its work and render its decisions in a timely, efficient and predictable way.
I was glad to see the comprehensive reforms in Bill C-86. I'm also mindful that the bill is well on its way to becoming law, so what I say here today may not have much immediate impact. For that reason, and in the interest of time, I'll just refer you to the testimony I gave before the Senate banking committee on November 21. I'll then touch on two specific issues.
First, the introduction of mandatory rate-setting criteria, including both the public interest and what a willing buyer would pay to a willing seller, is a very positive development. Clear and explicit criteria should result in a more timely, efficient and predictable tariff process. That's important because unpredictable rates can lead to severe market disruption, especially in emerging markets, like online music.
I'm concerned that the benefits of the provision in Bill C-86 will be undermined by its language, which also empowers the board to consider “any other criterion” it deems appropriate. An open-ended approach like this will create more mandatory boxes for the parties to check, in addition to things like technological neutrality and balance, which the Supreme Court introduced in 2015, but it won't guarantee that the board won't simply discard the parties' evidence in favour of other, totally unpredictable factors. That could increase the cost of board proceedings, with no corresponding increase in efficiency or predictability.
If it's too late to delete that provision from Bill C-86, I suggest that the government move quickly to provide regulatory guidance as to how the criteria should be applied, including what to look for in the willing buyer, willing seller analysis.
Last, very briefly, I understand that some committee witnesses have suggested that rather than doing it voluntarily, as the act currently provides, collectives should be required to file their licensing agreements with the Copyright Board. I agree that having access to all relevant agreements could help the board develop a more complete portrait of the markets it regulates. That's a laudable goal.
However, there's also an important counterweight to consider: Users may be reluctant to enter into agreements with collectives if they know they're going to be filed with the Copyright Board and thus become a matter of public record. The concern would be, of course, that services in the marketplace are operating in a very competitive environment. The last thing they want to do is make the terms of their confidential agreements known to everyone, including their competitors. I can say more about this in the question and answer session to follow.
Thank you for your attention. I do look forward to your questions.
3:40 p.m.
Liberal
The Chair Liberal Dan Ruimy
Thank you very much.
We're going to move to Michael Geist.
You have seven minutes, please, sir.
3:40 p.m.
Dr. Michael Geist Canada Research Chair in Internet and E-Commerce Law, Faculty of Law, University of Ottawa, As an Individual
Thank you.
Good afternoon. My name is Michael Geist. I am a law professor at the University of Ottawa, where I hold the Canada research chair in Internet and e-commerce law and where I am a member of the Centre for Law, Technology and Society. I appear today in a personal capacity as an independent academic, representing only my own views.
I have been closely following the committee's work, and I have much to say about copyright reform in Canada. Given the limited time, however, I'd like to quickly highlight five issues: educational copying, site blocking, the so-called value gap, the impact of the copyright provisions in the CUSMA, and potential reforms in support of Canada's innovation strategy. My written submission to the committee includes links to dozens of articles I have written on these issues.
First, on educational copying, notwithstanding the oft-heard claim that the 2012 reforms are to blame for current educational practices, the reality is that the current situation has little to do with the inclusion of education as a fair dealing purpose. You need not take my word for it. Access Copyright was asked in 2016 by the Copyright Board to describe the impact of the legal change. It told the board that the legal reform did not change the effect of the law. Rather, it said, it merely codified existing law as interpreted by the Supreme Court.
Further, the claim of 600 million uncompensated copies that lies at the heart of allegations of unfair copying is the result of outdated guesswork using decades-old data and deeply suspect assumptions. The majority of the 600 million, or 380 million, involves kindergarten to grade 12 copying data that goes back to 2005. The Copyright Board warned years ago that the survey data was so old it may not be representative. The remaining 220 million comes from a York University study, much of which is as old as the K-to-12 data. Regardless of its age, however, extrapolating some old copying data from a single university to the entire country does not provide a credible estimate.
In fact, this committee has received copious data on the state of educational copying, and I would argue that it is unequivocal. The days of printed course packs have largely disappeared in favour of digital access. As universities and colleges shift to digital course management systems, the content used changes too. An Access Copyright study at Canadian colleges found that books comprised only 35% of the materials. Moreover, the amount of copying that occurs within these course management systems is far lower than exists with print.
Perhaps most importantly, CMS allows for the incorporation of licensed e-books, open access materials and hyperlinks to other content. At the University of Ottawa, there are now 1.4 million licensed e-books, many of which involve perpetual licences that require no further payment and can be used for course instruction. Further, governments have invested tens of millions in open educational resources, and educational institutions still spend millions annually on transactional pay-per-use licences even where those schools have a collective licence.
What this means is that the shift away from the Access Copyright licence is not grounded in fair dealing. Rather, it reflects the adoption of licences that provide both access and reproduction rights. These licences provide universities with access to content and the ability to use it in their courses. The Access Copyright licence offers far less, granting only copying rights for previously acquired materials. Therefore, efforts to force the Access Copyright licence on educational institutions by either restricting fair dealing or implementing statutory damages reform should be rejected. The prospect of restricting fair dealing would represent an anti-innovation and anti-education step backwards, and run counter to the experience of the past six years of increased licensing, innovation and choice for both authors and educational users.
With respect to statutory damages, supporters argue that a massive escalation in potential statutory damage awards is needed for deterrence and to promote settlement negotiations, but there is nothing to deter. Educational institutions are investing in licensing in record amounts. Promoting settlement negotiations amounts to little more than increasing the legal risks for students and educational institutions.
Second, on site blocking, the committee has heard from several witnesses who have called for the inclusion of an explicit site-blocking provision in the Copyright Act. I believe this would be a mistake. First, the CRTC proceeding into site blocking earlier this year led to thousands of submissions that identified serious problems with the practice, including from the UN special rapporteur for freedom of expression, who raised freedom of expression concerns, and technical groups who cited risks of over-blocking and net neutrality violations. Second, even if there is support for site blocking, the reality is that it already exists under the law, as we saw with the Google v. Equustek case at the Supreme Court.
Third, on the value gap, two issues are not in dispute here. First, the music industry is garnering record revenues from Internet streaming. Second, subscription streaming services pay more to creators than ad-based ones. The question for the copyright review is whether Canadian copyright law has anything to do with this. The answer is no.
The notion of a value gap is premised on some platforms or services taking advantage of the law to negotiate lower rates. Those rules, such as notice and take down, do not exist under Canadian copyright laws. The committee talked about this in the last meeting. That helps explain why industry demands to this committee focus instead on taxpayer handouts, such as new taxes on iPhones. I believe these demands should be rejected.
Fourth is the impact of the new CUSMA. The copyright provisions in this new trade agreement significantly alter the copyright balance by extending the term of copyright by an additional 20 years, a reform that Canada rightly long resisted. By doing so, the agreement represents a major windfall that could result in hundreds of millions for rights holders and creates the need to recalibrate Canadian copyright law to restore the balance.
Finally, there are important reforms that would help advance Canada's innovation strategy, for example, greater fair dealing flexibility. The so-called “such as” approach would make the current list of fair dealing purposes illustrative rather than exhaustive and would place Canadian innovators on a level playing field with fair use countries such as the U.S. That reform would still maintain the full fairness analysis, along with the existing jurisprudence, to minimize uncertainty. In the alternative, an exception for informational analysis or text and data mining is desperately needed by the AI sector.
Canada should also establish new exceptions for our digital lock rules, which are among the most restrictive in the world. Canadian businesses are at a disadvantage relative to the U.S., including the agriculture sector, where Canadian farmers do not have the same rights as those found in the United States.
Moreover, given this government's support for open government—including its recent funding of Creative Commons licensed local news and its support for open source software—I believe the committee should recommend addressing an open government copyright barrier by removing the Crown copyright provision from the Copyright Act.
I look forward to your questions.
3:45 p.m.
Liberal
The Chair Liberal Dan Ruimy
Thank you very much. Your timing was really good.
Ms. Gendreau, you have seven minutes.
3:45 p.m.
Prof. Ysolde Gendreau Full Professor, Faculty of Law, Université de Montréal, As an Individual
Mr. Chair, ladies and gentlemen, thank you for agreeing to hear me.
My name is Ysolde Gendreau, and I am a full professor at the Université de Montréal's Faculty of Law.
Since my master's studies, I have specialized in copyright law—I am the first in Canada to have completed a doctorate in this field. With few exceptions, my publications have always focused on this area of law. I am appearing here in a purely personal capacity.
I would like to read an excerpt from the discussions at the Revision Conference of the Bern Convention in Rome in 1928 on the right to broadcasting, recognized in article 11bis.
Comments on that text state:
In the first paragraph, the article... strongly confirms the author's right; in the second, it leaves it to national laws to regulate the conditions under which the right in question may be exercised, while acknowledging that, in recognition of the general public interest of the State, limitations to copyright may be put in force; however it is understood that a country shall only make use of the possibility of introducing such limitations where their necessity has been established by the experience of that country itself; such limitations shall not in any case lessen the moral right of the author; nor shall they affect the author’s right to equitable remuneration, which shall be fixed, failing agreement, by the competent authorities.
The principle of the 1928 article remains today.
Were the economic players who benefited from the broadcasting of works, that is, the broadcasters, and who had liability imposed on them at the time happy with it? Of course not. Today, the economic players who benefit from the distribution of works on the Internet continue to resist the imposition of copyright liability.
We don't have to wait 90 years to reach the consensus that exists in the broadcasting world. Just 20 years later, in 1948, no one batted an eyelid to see broadcasters pay for the works they use. In the future, the resistance of today's digital communications industry will be considered just as senseless as that of broadcasters 90 years ago if we act.
I would now like to turn your attention to enforcement issues with respect to the Internet. Because it is tied to the right to communicate, the making available right has become part of the general regime that governs this right to communicate. Additional provisions have, however, generated antinomies that sap the new right of the very consequences of its recognition. Here are examples, which I do not expect you to read as I refer to them, but that I am showing to you now because I'll refer to them generally later on.
The general ISP liability requires the actual infringement of a work in order to engage the liability of a service provider. This condition is reinforced by a provision on statutory damages. The hosting provision also requires an actual infringement of a work, this time recognized by a court decision in order to engage the liability of a hosting provider. Our famous UGC exception is very much premised on the use of a single work or very few works by a single individual for whom the copyright owner will be claiming that the exception does not apply. Within the statutory damages provisions, several subsections seriously limit the interest of a copyright owner to avail himself of this mechanism. One of them even impacts other copyright owners who would have a similar right of action. Of course, our notice and notice provisions are again premised on the issuance of a notice to a single infringer by one copyright owner.
The functional objectives of these provisions are completely at odds with the actual environment in which they are meant to operate. Faced with mass uses of works, collective management started in the 19th century precisely because winning a case against a single user was perceived as a coup d'épée dans l'eau. The Internet corresponds to a much wider phenomenon of mass use, yet our Copyright Act has retreated to the individual enforcement model. This statutory approach is totally illogical and severely undermines the credibility of any copyright policy aimed at the Internet phenomenon.
As you may have seen, the texts I refer to are fairly wordy, and many are based on conditions that are stacked against copyright owners. Just imagine how long it may take to get a judgment before using section 31.1, or how difficult it is for a copyright owner to claim that the dissemination of a new work actually has “a substantial adverse effect, financial or otherwise, on the exploitation or potential exploitation” of the work”. These provisions rely on unrealistic conditions that can only lead to abuses by their beneficiaries.
The direction that our Copyright Act has taken in 2012 goes against the very object that it was supposed to harness. The response to mass uses can only be mass management—that is, collective management—in a manner that must match the breadth of the phenomenon. The demise of the private copying regime in the 2012 amendments, by the deliberate decision not to modernize it, was in line with this misguided approach of individual enforcement of copyright on the Internet.
Given the time available, I'm not able to raise the points that should logically accompany these comments, but you may want to use the period for questions to get more details. I would be pleased to provide you with that information.
Thank you for your attention.
3:55 p.m.
Liberal
The Chair Liberal Dan Ruimy
Thank you very much.
We're going to move to, finally, the Intellectual Property Institute of Canada.
Mr. Tarantino.
3:55 p.m.
Bob Tarantino Chair, Copyright Policy Committee, Intellectual Property Institute of Canada
Thank you, Mr. Chair.
My name is Bob Tarantino. I'm here with Catherine Lovrics. We are here in our capacities as former chair and current chair, respectively, of the Intellectual Property Institute of Canada's copyright policy committee. We are speaking in those capacities and not on behalf of the law firms with which we are associated, or on behalf of any of our respective clients.
We'd like to thank you for inviting IPIC to present to you our committee's recommendations with respect to a statutory review of the act.
IPIC is the Canadian professional association of patent agents, trademark agents and lawyers practising in intellectual property law. IPIC represents the views of Canadian IP professionals, and in our submissions to the committee we strove to represent the diversity of views among copyright law practitioners in as balanced a manner as possible.
You have our committee's written submissions, so in this speech I will be highlighting only a few of the recommendations contained therein. That being said, I'd like to provide a framing device for our comments, which I think is important for this committee to bear in mind as it deliberates, and that is the need for evidence-based policy-making. The preamble to the 2012 Copyright Modernization Act described one of the purposes of its amendments as promoting “culture and innovation, competition and investment in the Canadian economy”.
However, the extent to which any of those desired goals have been achieved because of changes to the act in 2012 remains unknown. There is little to no publicly available empirical data about the effects of copyright reform. We recommend that work commence now in anticipation of the next mandated review of the act to ensure that copyright reform proceeds in a manner informed by rigorous, transparent and valid data about the results, if any, which copyright reform has already achieved. Parliament should identify what would constitute success in copyright reform, mandate funding to enable the collection of data that speak to those identified criteria for success and ensure that the data is publicly accessible.
As noted in our written submission, we think some easy and granular fixes can be made to the act that will facilitate copyright transactions. Those changes include allowing for the assignment of copyright in future works and clarifying the rights of joint owners. The remainder of my comments will highlight four bigger picture recommendations, each of which should be implemented in a way that respects the rights and interests of copyright authors, owners, intermediaries, users and the broader public.
On data and databases, it is now trite to say that increasing commercial value is attributed to data and databases. However, the current legal basis for according copyright protection to them remains uncertain. Consideration should be given to amendments that effect a balance between the significant investments made in creating databases and avoiding inadvertently creating monopolies on the individual facts contained within those databases or deterring competition in fact-driven marketplaces. One approach to this issue that we flag for your attention is the European Union's sui generis form of protection for databases.
Regarding artificial intelligence and data mining, continuing with the theme of uncertainty, the interface between copyright and artificial intelligence remains murky. The development of machine learning and natural language processing often relies on large amounts of data to train AI systems, the process referred to as data mining. Those techniques generally require copying copyright-protected works, and can also require access to large datasets that may be protected by copyright.
We recommend that the committee consider text and data access and mining requirements in the context of AI. In particular, we refer you to amendments enacted in the United Kingdom that permit copying for the purposes of computational analysis.
Relatedly, whether works created using AI are accorded copyright protection is ambiguous, given copyright's originality requirement and the need for human authorship. A possible solution is providing copyright protection to works created without a human author in certain circumstances. Again, we refer you to provisions contained in the copyright legislation of the United Kingdom and to the approach the Canadian Copyright Act takes in respect to makers of sound recordings.
One the $1.25-million tariff exemption for radio broadcasters, the first $1.25 million of advertising revenue earned by commercial broadcasters is exempt from Copyright Board-approved tariffs in respect of performer's performances and sound recordings, other than a nominal $100 payment. In other words, of the first $1.25 million of advertising revenue earned by a commercial broadcaster, only $100 is paid to performers and sound recording owners. By contrast, songwriters and music publishers collect payments from every dollar earned by the broadcaster. The exemption is an unnecessary subsidy for broadcasters at the expense of performers and sound recording owners and should be removed.
Regarding injunctive relief against intermediaries, Internet intermediaries that facilitate access to infringing materials are best placed to reduce the harm caused by unauthorized online distribution of copyright-protected works. This principle is reflected in the EU copyright directive and has provided the foundation for copyright owners to obtain injunctive relief against intermediaries whose services are used to infringe copyright. The act should be amended to expressly allow copyright owners to obtain injunctions such as site blocking and de-indexing orders against intermediaries.
The act should be amended to expressly allow copyright owners to obtain injunctions such as site blocking and de-indexing orders against intermediaries. This recommendation is supported by a broad range of Canadian stakeholders, including ISPs. Moreover, more than a decade of experience in over 40 countries demonstrates that site blocking is a significant, proven and effective tool to help reduce access to infringing online materials.
I'd like to thank you again for inviting IPIC to present you with our comments today.
We're happy to answer any questions you may have about our submission.
4 p.m.
Liberal
The Chair Liberal Dan Ruimy
Thank you very much.
We're going to jump right into questions, starting with Mr. David Graham.
You have seven minutes, sir.
December 10th, 2018 / 4 p.m.
David de Burgh Graham Laurentides—Labelle, Lib.
Thank you.
I have enough questions to go around. It might be a bit of a game of whack-a-mole here.
We talked a bit about the need to go to basically collective enforcement rather than individual enforcement of copyright because it's no longer manageable. How can collective copyright enforcement work without just empowering larger users and owners to trample on users and small producers?
4 p.m.
Full Professor, Faculty of Law, Université de Montréal, As an Individual
The difficulty I see behind your question is that people tend to see the collective administration of copyright as a big business issue. People tend to forget that behind the CMOs, collective management organizations, or the collectives, there are actual individuals. The collective management of rights for these people is actually the only solution for them to make sure that they receive some sort of remuneration in this kind of mass environment, and indeed they require getting together in order to fight off GAFA. This is the elephant in the room. We know that so much money is being siphoned off the country because not enough people who are involved in the business of making all these works available to the public are paying their fair share of this kind of material.
This kind of management is possible. There are enough safeguards in the act, and even in the Competition Act, to ensure that this is not being abused.
4 p.m.
Laurentides—Labelle, Lib.
Talking about abuse, we certainly see the abuse. Google and Facebook were here a couple of weeks ago. They admitted they only look at larger copyright holders when they're doing their enforcement systems. They admit they don't care about Canadian exemptions under fair dealing. The abuse is already there.
I don't see how removing protections for individuals is going to improve that.
4 p.m.
Full Professor, Faculty of Law, Université de Montréal, As an Individual
I'm not saying that we should remove protections from individuals. I'm just saying that when all is looked at globally, everybody should be paying a fair share for the use of the works. I have trouble imagining that people who are willing to pay $500 and more for an iPhone would find it damaging to pay an extra.... I certainly don't want to be bound by whatever number we may imagine. We'd say that this is going to prevent them from having free expression or from having access to the work. Even if, on the price of an iPhone or other equipment, extra money were not added, given the profit margin on these products, this is something that will certainly not put these companies into bankruptcy.
I see the advent of a better functioning collective management system as something that actually protects the individuals.
4 p.m.
Laurentides—Labelle, Lib.
I don't have a lot of time so I'll move on.
Mr. Geist, I mentioned Facebook and Google's testimony a minute ago where they identified that they don't make any effort to enforce fair dealing. You are familiar with that. Do you have any comments or thoughts on that from your sense or background?
4 p.m.
Canada Research Chair in Internet and E-Commerce Law, Faculty of Law, University of Ottawa, As an Individual
Yes, it's been a significant source of frustration. In fact, I had a personal experience with my daughter, who created a video after she participated in a program called March of the Living, where she went to concentration camps in Europe and then on to Israel. As part of the Ottawa community, she interviewed all the various participants who were alongside her, created a video that was going to be displayed here to 500 people. There was some background music along with the interviews. They posted it to YouTube, and on the day this was to be shown the sound was entirely muted because the content ID system had identified this particular soundtrack.
They were able to fix that, but if that isn't a classic example of what non-commercial, user-generated content is supposed to protect, I'm not sure what is. The fact that Google hasn't tried to ensure that the UGC provision that Professor Gendreau mentioned, which, as this example illustrates, has tremendous freedom of expression potential for lots of Canadians, is for me not just disappointing but a real problem.
4:05 p.m.
Laurentides—Labelle, Lib.
Mr. Chisick, I have a question for you too.
You talked about 22% of the value for broadcasters' backup copies. If they're actual backup copies, where is the problem?
4:05 p.m.
Partner, Cassels Brock & Blackwell LLP, As an Individual
The problem is this. The Copyright Board conducted an overall valuation of all of the copies used by radio broadcasters. It determined that if it were forced to allocate value among the different types of copies, some value would go to backup copies, some value would go to main automation system copies and so on and so forth, until you get to 100%.
The Copyright Board found that 22% of that value was allocable to backup copies. In other words, radio stations derive commercial value from the copies they make and 22% of that is allocable to backup copies. There is therefore significant commercial value to those backup copies, yet the Copyright Board felt compelled, under the expanded backup copies exception, to remove that value from the royalties that are paid to rights holders.
Now, if that was a correct interpretation of the backup copies exception, then the Copyright Board may have had no choice but to do what it did. My point is simply that the intention of these exceptions must not be to exempt large commercial interests from paying royalties for copies from which they themselves derive significant commercial value. That's an example to me of a system of exemptions that's out of whack in the grand scheme of balance between the interests of rights holders, users and the public interest.
4:05 p.m.
Laurentides—Labelle, Lib.
I have only a half a minute left here, but I'm just trying to understand the issue, because you've brought up this major point about the money that they're not spending on.... If they use the main copy or the backup copy to broadcast something, what's the difference?
4:05 p.m.
Partner, Cassels Brock & Blackwell LLP, As an Individual
I'm sorry. I didn't understand your question.
4:05 p.m.
Laurentides—Labelle, Lib.
We've always had the right to format shifting. If I buy something that I convert to the computer and I broadcast it, that's the backup copy, and if you add a monetary value.... This all doesn't connect very well to me.
