Canadian music industry wants government to pay music copying fees on all smartphones

The idea is similar to making internet providers contribute to Canadian film and TV content funds

Music Streaming through Spotify

The Canadian music industry wants the government to pay music copying fees for all smartphones sold in the country.

According to documents released under the Access to Information Act to University of Ottawa law professor Michael Geist, federal government officials were pitched the idea in September 2017 by Canadian Private Copying Collective (CPCC).

The collective administers taxes on blank CDs for their potential use in private copying of music, and has advocated for extending the payments to iPods and SD cards, among other things.

CPCC proposed that each smartphone should be taxed approximately $3.50 CAD for its ability to hold copied music, an estimate based on its research of Europe’s copying fees for electronic devices.

However, since it believes legislative reform will take too long, the collective requested that the government pay the fee in the interim, to the tune of $40 million annually for four years ($160 million total).

Subsequently, Music Canada president and CEO Graham Henderson appeared before the House of Commons Standing Committee on Canadian Heritage to propose the concept in May 2018.

Music Canada is a non-profit industry organization comprised of members Sony Music Entertainment Canada, Universal Music Canada and Warner Music Canada, with affiliates including eOne Music and MDM Recordings.

In his blog post on the subject, Geist stated: “The demand is striking for several reasons.”

He went on to write that private copying of music has gradually diminished as Canadians gravitate to subscription services such as Spotify. He also noted that the Canadian music market is growing faster than the world average, citing industry data.

“Yet despite the success stories, the CPCC and the broader music industry wants a $160 million handout based on the premise that every device sold in Canada should have a music copying fee attached to be paid by taxpayers,” he concluded.

The idea is similar to the recent suggestion from Canada’s telecom regulator that internet providers pay a tax for Canadian content creation, given that Canadians consume so much streaming video on the internet.

Geist was similarly opposed to the idea, stating that “broadcasting might be the internet, but the internet is not broadcasting.”

Source: Michael Geist (1), (2)