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  • Introduction: former UofO formerly in-house counsel at CAB currently VLSBroadcast industry: Metrics, content offeringsCopyright: started as one tariff – radio over 80 years ago then three tariffs – radio, TV, S&P now impossible to say how many apply, and more coming upChanging Legal: 5 SCC decisions C-11 Many ongoing Copyright Board and Fed’l Ct casesFuture: technology will shape copyright we assume that 10 years from now the landscape will be very differentDisclaimer: we are here speaking as individuals, using one of our clients’ industries as an example but in no way advocating for or reflecting the direct view of our clients
  • Broadcasting at a glance  20102011 % Growth Revenues($millions)Broadcasting 15,728        16,586 5.5Radio 1,552          1,613 3.9Television 6,055          6,385 5.5BDU8,119          8,588 5.8PBIT ($ millions)Radio 298 311 4.3Television 889 1,091 22.7Conventional ranges from -4 to +6 in last 3 yearsEBITDA ($ millions)BDU1,2 2,001 1,927 -3.717.7 vs. 8.3 reach for radio, depending on who you ask.28.5 TVOnline presence growing slowly but hard to justify large investment when margins not there
  • Youtube is 7 times larger then the next 4 biggest video services internationallyPandora – from March last year:The Oakland company said Thursday that the number of active listeners (that is, people who have used the service at least once in the past 30 days) grew to 51 million in March, up 59% from a year earlier.The amount of time users spend listening also grew -- to more than 1 billion hours last month, from 567 million hours in March 2011. Each Pandora listener spent more time on average with the service as well, about 19.6 hours in March compared with 17.7 hours a year ago.By listenership, almost as large as the entire Canadian radio industry
  • 2 kinds of licensing – direct (what it sounds like) and collectiveCollectives are rightsholders acting together; in theory, this is easier and less complicated than direct licensingDepending on circumstances, both types are usedPrimarily collective licensing for radio, TV and webcasting/online uses of musicCopyright Board = admin tribunal, quasi judicial, rate setting bodyGoverned by Copyright ActCollectives file tariff proposals, objectors object, hearing to set rates
  • Applying Copyright Act to changing technology is difficult; internet tariffs are a great exampleSOCAN T22 first filed for 1996; decision was in two phasesOctober 1999 – legal issues decision e.g. what is communication on the internet? Appealed to SCC and ultimately back to BoardOctober 2007 – rate setting for 22.A and October 2008 – rate setting for 22.B to G; appealed to SCC and ultimately back to BoardSCC decisions issued this yearSOCAN v Bell – fair dealing in previewsESA, Rogers – what is communication to the public on the internet? Downloads not communicationMore about these later
  • In addition to SOCAN T22, there are other tariffs. SOCAN represents authors, composers and publishers for the communication rightRe:Sound represents labels/performers for the communication rightCSI represents authors, composers and publishers for the reproduction rightAVLA represents labels for reproduction right (no tariffs, prefer to do direct licensing for online uses)ACTRA PRS/MROC and ArtistI represent performers for reproduction right (no tariffs for online uses yet, still working on radio tariffs)Re:Sound 8Semi-interactive, non-interactive webcastingNot on-demand streaming and not podcastingAudio only uses (because of Copyright Act limitation)Rates are “greater of” % of revenue and a penny rateCSI Online Music ServicesNon-interactive and interactive webcasting, and on-demand streaming, limited and permanent downloadsAudio only uses (because of membership agreement limitation)Rates are % of revenue, with penny rate for minimum feeSOCAN T22ARecommended and on-demand streaming, limited and permanent downloads, and free streamsNot webcasting – in other parts of T22Audio and audiovisual uses
  • International players notably absent until now – why? Complexity, small market, lack of clear parametersDomestic players will probably feel the pain, because Canadians tend to be more internet focussed than Americans, for example (Spotify huge in its base in Sweden)Partnerships to develop viable business modelsDepends if tariffs based on per play or revenue models. Per play favour incumbent services, revenue depends on rate
  • Is Bill C-11 outdated already? (answer – partially yes, if interpreted liberally, it could work for a whileDOA if interpreted narrowly
  • ESAC – download is not a communication, only a reproductionVideo game downloadsRogers – stream is still a communication, and it is to the publicRingtone downloadsSOCAN – previews are fair dealingiTunes previewsAlberta – beefed up fair dealing and CCH, sent back to BoardPhotocopying in schoolsRe:Sound 9 – no rights for labels/performers in audiovisual works, only audio separatelyNew proposed tariff for TV and movie theatresKey takeaway: Technical neutrality is keyCollectives shouldn’t assume new revenue stream when new delivery methods introduced
  • New exceptions – not all copies deserve to be paid for29.24 – back-ups30.71 – technological process30.9 – ephemeral copiesMany others (UGC, etc)Previously tariffable reproductions should now have reduced/eliminated valueCAB Application http://www.cb-cda.gc.ca/avis-notice/active/2012/commercialradio-12112012.pdfInterim relief – acknowledge change in lawPermanent relief – hearing to establish valueInterim rejected; permanent proceedingIf successful in eliminating the reproduction tariffs, why would CSI exist?
  • This diagram shows that the pace of technological change has outpaced the pace of legislative renewal, interpretive jurisprudence and the current status of collective administration of copyright. Prior to C-11, this chart would have shown a much smaller legislative framework component. The SCC pentalogy demonstrated that the SCC takes relatively technologically neutral position in their interpretation of the Copyright Act. They also demonstrated a clear commitment to user rights. All of this bodes well for the future, but does not change the fact that current technologies are still not adequately “managed” through our existing legal system as it applies to copyright. The most important feature of this diagram is the limited status of collective administration. Tariffs take far too long to certify. Prospective users are confused and stay away from Canada.
  • A possible solution to the current situation, where technological development has outpaced the legal framework governing copyright, is to start from scratch and draft new copyright legislation that is technologically neutral and set up for liberal interpretation by the courts. The Copyright Board framework and process would have to be overhauled completely in tandem.

Transcript

  • 1. radio, TV, copyright and technologythe intersection of law, policy, and business strategy
  • 2. introduction broadcasting industry copyright and business models ◦ traditional broadcasting ◦ early internet uses ◦ new internet uses the changing legal environment into the futureoutline
  • 3. private broadcasting in Canada ◦ revenue ◦ reach ◦ product offerings ◦ Bell & Astral proposed transactionbroadcasting industry
  • 4. technological challenges for private broadcasters ◦ online ventures – scale and scope ◦ geo-blocking to protect rights ◦ a/v: YouTube/Netflix/Hulu and other online only services ◦ audio: Pandora/Spotifybroadcasting industry
  • 5. broadcasting and copyright  collective v direct licensing  music and collective licensing  copyright boardcopyright & business models
  • 6. internet copyright – history ◦ first hearing on t22, went to SCC ◦ next hearing on t22, appealed 7 times, unsettled ◦ preview decision – fair dealing ◦ ESA, Rogers – downloading not communicationhistory of internet copyright
  • 7. internet copyright – current ◦ Re:Sound 8, CSI OMS, SOCAN T22a ◦ complexity getting worsecurrent internet copyright files
  • 8. internet copyright – future  Pandora, Spotify coming into Canada?  how will traditional broadcasting deal?  are the tools in place to create balance and foster a vibrant marketplace?future internet copyright issues
  • 9. Bill C-11  New exceptions  Anti-piracy measures  Balance? Neutral?  DOA?evolving legal environment
  • 10. SCC pentalogy  Fair dealing  Downloads  Neutrality is kingevolving legal environment
  • 11. broadcasting and C-11 ◦ making new exceptions work ◦ reproduction right application ◦ implications for collective administration of copyrightevolving legal environment
  • 12. Technology Jurisprudence Legislative Framework Collective Administrationtechnology outpacing legal system
  • 13. Legislative Framework + Jurisprudence Collective Administration Technologysolution = technological neutrality
  • 14.  legislation – drafting, lobbying, implementing (not necessarily in that order) role of expertise? judicial interpretation should the law be clear or vague? what is the role for lawyers? what is the role for businesses?law and policy and business
  • 15. Thanks Van Loon Simmons Professional Corporation gabriel@vanloonsimmons.comkathleen@vanloonsimmons.com