Broadcasters slam music industry copyright proposal

OTTAWA — Canada’s private broadcasters are defending Canada’s existing copyright laws and tariff rules and say a proposal to nix a radio royalty exemption in the Copyright Act is an attempt at a cash grab by the recording industry. That comes after recording industry groups criticized the exemption as a “subsidy” for big media companies. Music industry groups have argued the royalty exemption, which has been set out in the Copyright Act since 1997, has meant artists don’t get their fair share and said Parliament should get rid of it. Copyright Act S.68(1) keeps royalty payments from radio stations down to $100 for the first $1.25 million in ad revenue. After that point, they have to pay a percentage of ad revenue at rates set out by the Copyright Board of Canada. Canadian Association of Broadcasters (CAB) board chair Nathalie Dorval told MPs on the House of Commons industry committee Monday that the proposal is a “money grab” that would benefit multinational record labels and upset the “balance” of the current law between rights-holders and radio broadcasters. The group also made the same argument at the Heritage committee Tuesday, as part of its study on artist remuneration. Dorval argued that removing the exemption would impose an extra $8 million in costs on the Canadian radio sector, and said commercial radio stations in Canada already pay about $91 million in copyright tariffs each year. The CAB’s submission to the committee included a stark warning that bringing in a new neighbouring rights tariff for radio broadcasters would “represent a substantial financial shock for the radio industry” and that the “amendments being put forward by the music industry risk destabilizing local broadcasters.” “Since 2013, commercial radio has experienced successive years of systemic revenue decline that has put significant upward pressure on operating costs, including local programming,” it said. “Local radio risks suffering the same fate as small local newspapers which are fast becoming obsolete in our country.” Liberal MP Llyod Longfield said the committee had heard “the opposite testimony” from the CAB – that the major current beneficiaries of the exemptions are broadcasters with multiple locations, not small stations – and that while artists face declining revenue, stations have increasing revenue. “We're just trying to square that situation,” he said. Dorval replied that radio experienced four straight years of revenue declines in Canada. Back in June, music industry groups stood united in asking to get rid of the $1.25 million tariff exemption and said it would have an immediate positive effect on artists. Music Canada president and CEO Graham Henderson told MPs it’s an “unjustified” $8 million “cross-industry subsidy paid by artists and their recording industry partners to large, vertically integrated and highly-profitable media companies.” “No other country has a similar subsidy, and the exemption does not apply for songwriters or publishers – meaning that performers and record labels are the rights holders who are singled out to subsidize the commercial radio industry,” he said, and argued it has cost creators $150 million since its creation in 1997. Ian MacKay, president of Re:Sound Music Licensing Company, testified in June that the exemption is an “unwarranted and inconsistent subsidy to a highly-profitable industry.” “It's outdated and was intended to be a temporary measure but still exists over 20 years later,” he told MPs at the time. A representative from Stingray Digital Group Inc. also told the committee Monday that the status quo hits the right “balance” between rights holders and users. The CAB said MPs should listen to artists directly on how to help make sure they get paid fairly for their work, and pointed to recent testimony at the House of Commons heritage committee by rock star Bryan Adams as an example. He had urged parliamentarians to change the Copyright Act so it would grant artists back the copyright to their works before they die. — With reporting by Kyle Duggan at kduggan@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Broadcasters slam music industry copyright proposal

Broadcast | September 25, 2018

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Broadcasters slam music industry copyright proposal

Broadcast | September 25, 2018

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