OTTAWA – Canada’s creative community applauded the House of Commons Standing Committee on Canadian Heritage for hitting the right notes in calling for better pay for Canadian artists in its Shifting Paradigms report presented to Parliament on May 15.
Now, however, groups representing artists want the federal government to produce a symphony of legislative change from the committee’s 22 recommendations, which include a call to both support creators and creative industries adapt to new digital markets, and review safe-harbour exceptions and laws to ensure that Internet service providers (ISPs) are “accountable for their role in the distribution of content.”
“As technology has evolved, remuneration models for artists and creative industries have not,” reads the Heritage Committee report. “Artists are not being paid adequately for the use of their works, particularly online.”
This study was conducted after an invitation by the Standing Committee on Industry, Science and Technology, which was reviewing the Copyright Act. Each committee is submitting their own report, however. The report on updating the Copyright Act has yet to be completed.
Shifting Paradigms “moves Canada into a leadership role in the international effort to close the ‘value gap’ and address the harm being done to creators everywhere by overly broad safe harbor laws,” said Graham Henderson, president and CEO of Music Canada, in a statement. “In order for these recommendations to make an impact on the music community, they must become law.”
In 2017, Music Canada, the Toronto-based trade organization that represents the country’s major record labels, released a report on the “value gap,” or the disparity between the creative content accessed by consumers and the revenue returned to its creators that results from ad-supported, user-uploaded content on YouTube, the radio-royalty exemption and the definition of “sound recording” used in television and film soundtracks.
On the latter two points, the committee recommended limiting the royalty exemption to community and independent stations, and called for an amendment of the definition of “sound recording” in the Copyright Act to allow music used in TV and movie soundtracks be eligible for public-performance remuneration.
“The value gap is increasing and artists’ middle class is declining. If artists aren’t compensated for their work, they will stop being artists.” – Jackie Dean, Music Canada
“The value gap is increasing and artists’ middle class is declining. If artists aren’t compensated for their work, they will stop being artists,” said Music Canada chief operating officer Jackie Dean, a certified public accountant by profession, in an interview.
Canada’s broadcasting industry, however, took exception to Music Canada’s position on the royalty exemption.
In its appearance before the Heritage committee last September, the Canadian Association of Broadcasters (CAB) warned that by removing the exemption from commercial radio stations, “the primary beneficiaries will be the multinational record labels who are proposing it,” and, based on number-crunching the CAB conducted on radio playlists in major English-language markets, found that 41% of payments for the rights to play a song go to multinational record labels, while Canadian labels only receive about 2%.
CAB copyright committee chair Susan Wheeler said she is unsure as to what the Heritage committee means by “independent” radio stations, and whether that excludes any owned by Rogers, Corus or Bell, or “single-station” owners affiliated with, say, Stingray, which is “not a vertically integrated media company but is not independent in the sense that they command a big market share.”
She believes the committee failed to recognize that “regardless of ownership, radio stations in small markets operate on very thin margins, so removing that exemption would mean having to eliminate certain programming elements.”
“The radio proposal by Music Canada, which represents the major labels – Universal, Sony and Warner – is about label remuneration not about artist remuneration as evidenced by the lion’s share of the revenue they will receive from the elimination of the exemption.” – Susan Wheeler, CAB
Wheeler, vice-president responsible for regulatory matters related to the media holdings at Rogers Communications, said in an interview that “very few” of the musical artists who testified at the Heritage committee hearings receive any radio play.
“The radio proposal by Music Canada, which represents the major labels – Universal, Sony and Warner – is about label remuneration not about artist remuneration as evidenced by the lion’s share of the revenue they will receive from the elimination of the exemption,” Wheeler, who also appeared before the heritage committee.
She pointed out that in 2018, the Canadian radio sector paid nearly $100 million in copyright royalties and contributed $50 million toward Canadian content development initiatives in order to support Canadian artists and “allow them to tour and get their music out to different audiences and build a career for themselves.”
Said Wheeler: “We feel radio has been a big partner and an important collaborator of the music industry, so it was really disappointing to see that wasn’t recognized by the Heritage committee and the music industry itself.”
The CAB also opposed redefining “sound recording,” arguing in its submission that “the labels are attempting to squeeze out an additional payment for the use of music from broadcasters, distributors and digital platforms in a television program that has already been paid for, up front, by the producers of that program.”
The Heritage committee also drew praise from Dave Forget, executive director of the Directors Guild of Canada (DGC). “I think they listened carefully to stakeholders and understood the challenges we and others presented about artists and creators, such as the value gap, and the extent to which content, whether it’s music or film and TV, has never been more available and more popular, and the people who make it are seeing less and less of a return on the value of that work,” he said in an interview.
The committee certainly heard the DGC and adopted the recommendation Forget presented on behalf of the guild last December to amend section 34.1 of the Copyright Act and “deem the screenwriter and director the co-owners of copyright and co-authors of a television or cinematographic work.”
“Why have a Copyright Act if you’re not going to make sure that people who create works are compensated.” – Dave Forget, DGC
Forget told Cartt.ca the DGC sought not to “change” the copyright legislation but to “clarify” the co-authorship of a TV show or film belonging to its screenwriters and directors and who “are entitled to be compensated both for the effort of their work and for the intellectual property that they create.” They are, as his submission to the committee highlighted, different than the “maker” of the cinematographic work, defined by the Act as “the person by whom the arrangements necessary for the making of the work are undertaken,” more commonly known as the producer.
“Why have a Copyright Act if you’re not going to make sure that people who create works are compensated,” said Forget, who also welcomed the Heritage committee’s call for the federal government to increase its anti-piracy efforts and enforce copyright.
“If widespread piracy and theft of intellectual property are happening, the time has come for us to have a careful look at the accountability and responsibility of the ISPs providing those services.”
Beyond the Heritage committee’s specific remedies for remuneration, its report represents a cultural “turning point,” not unlike the Massey Commission’s 1951 landmark study that resulted in part with the establishment of a national library and the creation of the Canada Council for the Arts, according to Rosemary Thompson, vice president of marketing, communications and public affairs at the Banff Centre for Arts and Creativity.
“We have to make a decision about whether we’re going to support Canadian culture, and the report points to a really big problem where the money is going to the wrong people south of the border to Silicon Valley that run the streaming services.” – Rosemary Thompson, Banff Centre for Arts and Creativity.
“We have to make a decision about whether we’re going to support Canadian culture, and the report points to a really big problem where the money is going to the wrong people south of the border to Silicon Valley that run the streaming services,” said Thompson, a former CTV and CBC reporter who previously served as executive director of communications and public affairs at the National Arts Centre in Ottawa.
“Canadian artists are creating incredible music and dance and theatre and opera and television and video, and they need to be paid properly and earn at least a living wage. If they can’t cut it anymore and leave, that means there’s less art being produced.
“The fixes aren’t that complicated, but it takes political courage to go there. I would like to see some of the committee’s findings in the election platforms of all the parties.”
You can read the report here.
