What exactly is the financial impact of C-32 on artists and other rights holders?

CCA Bul­letin 6/11

Feb­ru­ary 7, 2011

 

Just the facts

Sev­eral seem­ingly con­tra­dic­tory num­bers have been quoted over the course of the debate on the finan­cial impacts of Bill C-32 on artists and other copy­right holders.

In order to help facil­i­tate debate on this most impor­tant issue, the Cana­dian Con­fer­ence of the Arts (CCA), with the coop­er­a­tion of its mem­bers and other stake­hold­ers, has pre­pared a list of rev­enue sources for artists and rights hold­ers which are at risk unless Bill C-32 is amended.

There is no exact sci­ence to track­ing rev­enue losses. This is com­pounded by the fact that many of the new excep­tions in the bill such as edu­ca­tion and fair deal­ing are poorly defined. This view­point has been sup­ported by Dan Glover, a copy­right lawyer from McCarthy Tétrault LLP, who men­tions in his response to pro­fes­sor Michael Geist that, “the fair­ness test is noto­ri­ously soft and sub­jec­tive, an eye-of-the-beholder test that will be left in almost every case to the judg­ment of the copier.”

The total $126M fig­ure pre­sented here only rep­re­sents rev­enue that is col­lected and quan­tifi­able, and which is cur­rently at seri­ous risk of disappearing.

Tell me more

The $126M fig­ure does not:

• Track rev­enue losses that are more dif­fi­cult to esti­mate, such as losses caused by the “pri­vate pur­poses excep­tion” or the poten­tial elim­i­na­tion of the library mar­ket for sci­en­tific and tech­no­log­i­cal jour­nals due to the exten­sion of the inter­li­brary loan excep­tion and tem­po­rary repro­duc­tion for tech­no­log­i­cal processes;

• Account for lost rev­enue oppor­tu­ni­ties caused by the “user-generated con­tent” excep­tion and the “pub­licly avail­able mate­ri­als on the Inter­net” exception.

There are other losses which are either impos­si­ble to quan­tify or to project because:

• They are related to piracy, an issue which is not aided by a lack of mean­ing­ful respon­si­bil­ity on Inter­net ser­vice providers and the weak­en­ing of statu­tory dam­ages pro­posed in Bill C-32. As noted by sev­eral wit­nesses in front of the leg­isla­tive com­mit­tee on C-32, no one can pro­vide reli­able infor­ma­tion on such losses, which are known to hap­pen on a large scale;

• They are related to lost oppor­tu­ni­ties to develop new mar­kets and busi­ness mod­els which will be pre­cluded by the cumu­la­tive impact of the numer­ous new excep­tions included in the bill.

Finally, one must take into account the finan­cial impacts of these rev­enue losses on artists and other rights hold­ers. If C-32 passes in its cur­rent form, there will be a sub­stan­tial increase in lit­i­ga­tion costs as artists and cre­ators defend their rights and turn to the courts for clar­i­fi­ca­tion on the bill’s ill-defined exemptions.

 

Rev­enue at risk due to Bill C-32

 

• Fair deal­ing for the pur­pose of edu­ca­tion $41.4M

[C-32, sec­tion 21, related to Copy­right Act (CA) 34 (1)]:

Note: Includes $1 to 3M related to the dis­play excep­tion for
edu­ca­tional insti­tu­tions [C-32, sec­tion 21, related to CA 29.4 (1) and (3)];

Also includes in excess of $ 1.5M for Access Copy­right and $ 450,000
for Copibec related to Repro­duc­tion for test and exams
[C-32, sec­tion 23 (2), related to CA, 29.4 (2) and (3)]:

Sources: Access Copy­right, Copibec, SOQAD, SOCAN, SOPROQ and SODRAC

• Per­for­mance of cin­e­mato­graphic works by edu­ca­tional insti­tu­tions $25M
[C-32, sec­tion 24 (2), related to CA 29.5]:

Sources: Audio Ciné Film (ACF) and Criterion

• Non-extension of pri­vate copy­ing regime to dig­i­tal devices: $30M

Note: This fig­ure rep­re­sents the aver­age annual amount received from
2001 to 2009. This amount dropped to $24M in 2009 as copies are now
being made onto dig­i­tal audio recorders not cov­ered by the cur­rent pri­vate
copy­ing regime.

Source: CPCC

• Ephemeral record­ings [C-32, sec­tion 34 (1) related to CA 30.9 (1)]:

Com­mer­cial radio tar­iff                                                                         $21.2M
Source: Copy­right Board deci­sion, 2010

Broad­cast mechan­i­cal TV and other radio ser­vices                                  $8.6M

Source: CMRRA/SODRAC Inc.

TOTAL

:

$126.2 M