Copyright Consultation: the tail trying to wag the dog.

In yesterday’s article, as well as my submission to the consultation, I suggested that the recording industry is like the tail trying to wag the dog in the copyright consultation. The recording industry represents one of three copyright holding groups in a larger music industry made up of composers, performers, and “makers” of sound recordings. While this group dominated the music industry in the past, modern technology will inevitably cause a restructuring of the music industry such that they will be the smallest of the three.

Contrary to recording industry claims, it is my belief that even if there wasn’t a single unauthorized music file shared that the recording industry would be seeing a nearly identical decline.

The music industry is only one copyright dependant set of industries, and is quite small compared to even the productivity software and entertainment software industries. In fact, the growth in sectors such as communications technology (computers, cell phones, etc) and entertainment software has had a far greater impact towards the decline in recording industry revenues than “copyright infringement” could have.

Government intervention in the marketplace to protect the recording industry from inevitable change will have the unintended consequence of harming not only the music industry, but many other copyright dependant sectors. If you are from that majority whose job would be put at risk if the government gives in to the recording industry, make sure your voice is heard in the consultation.

The Toronto Town Hall was a bit of a specticle with a lot of noise, and very little signal. The recording industry stacked the room, and speaker after speaker from this tiny part of the copyright sectors came forward. They gave a sob story about how people are losing jobs, often trying to reference a person they knew personally. They then ignored the entire of the changing economy and claimed that unauthorized music filesharing was the entire reason why this was happening.

This is one of the problems with the copyright debate. A few industry associations come out with statistics that amount to the following: we see X amount of revenue in decline. We hate unauthorized sharing, and thus we will blame all of this decline on coyright infringement.

Having strong emotions doesn’t transform anger into a fact. When I do my own analysis I see little evidence that unauthorized filesharing is an important factor in the changes in the recording industry.

These “studies” do not take other economic trends into consideration. Young people have always been the largest purchasers of music. Unless you also believe in perpetual motion machines it is hard to believe that while these same young people are spending more and more money on communications technology (expensive portable computers with large cell phone packages including data plans), and more and more money on video games, that this money appears as “magic” rather than being diverted from previous spending. This money had to come from somewhere, and the most obvious is to notice a reduction in the money spent on music.

There are other important impacts on the recording industry they don’t want people to be thinking about. There is an ongoing transition from traditional music stores to legal downloads (#1 Apple’s iTunes, #2 eMusic) and big-box stores (#1 Wal-Mart, #2 Best Buy). These trends are both putting price pressures on music, meaning that even if the same number of songs were being sold that the amount of money made per song is reducing.

Legal download sites allow for individual song choices, while albums tended to be all or nothing. The recording indutry tried very hard to kill the concept of the single as it allowed them to charge money for songs people didn’t actually want in order for people to get what they did want. With legal download sites this is changing, meaning lower revenues as people won’t be paying for music they don’t want.

The big box stores also have the economic clout to demand price reductions on music. The big box stores stock fewer titles, meaning that the “long tail” that the music industry relies on for older titles doesn’t really exist.

I could go on and on with factors that have a greater impact on the bottom line of the recording industry than unauthorized sharing, but I suspect my point is obvious. We see lobbying that claims all harm is from unauthorized music sharing, but we don’t see lobbying to try to stop legal downloads of singles or to outlaw big box stores!

What the general public may not realize is that the music industry isn’t one happy family all conveying the same message. There are two different competing philosophies within the music industry that can be seen in the copyright consultation.

I mentioned earlier that there are 3 copyright holding groups in the music industry: composers, performers and “makers” of sound recordings.

The folks who are advocating locks and lawsuits is primarily the recording industry (”makers” of sound recordings). They are the advocates of legal protection for locks on content and devices, and I have written elsewhere (Georgia StraightThe Mark ) why I consider this to be analogous to “theft”. They have also been advocating for changes in the law to make it easier to sue people with even less evidence of infringing activities than is required today.

To summarize: While I find the proposals from the recording industry to be morally unjustifiable and offensive, I also see no evidence that these proposals would actually help the music industry in any way.

While there are always some individuals that are exceptions, most composers and performers have taken a very different approach. Instead of trying to stop music sharing they want to monitize this activity. The songwriters association of Canada has focused on a proposal to collect a levy as part of providing internet services that would go towards paying composers. The Canadian Music Creators Coalition have been opposed to locks and lawsuits, and endorse the songwriters proposal. The Canadian Private Copying Collective already applies to blank audio recording media, and this collective has been suggested that this also be applied to devices such as iPods which are used to store music.

While the levy proposals have their own flaws (See: Government imposition of specific business models on creators), they are far more forward thinking than what the recording industry wants. These proposals would also offer more money to the composers and the performers, which is only fair considering they provide the greatest value-add in the music industry. I get the feeling that this is in fact what the recording industry is fighting: it is not infringement that they are fighting, but fighting for ongong control over the industry such that it is the record labels rather than musicians that control the money.

The music industry has had an interesting history. Just over a hundred years ago everything was simpler. The music industry consisted of composers, and performers were considered to be trained monkeys who were consumers of sheet music who were not deserving of independant copyright. When the technology came forward to allow recordings it was seen as a form of “piracy” that would, if allowed to happen, destroy the music industry.

Governments did what they did for hundreds of years of copyright revision, which was to legalize this new “pirate” activity in a way that was relatively fair to everyone. Over time these “pirates” gained control over the industry, and in their peak in the 1980’s the recording industry dominated.

We always need to remember that what technology giveth, technology can take away. It was new technology that brought the recording industry into existance. While this technology was expensive, this industry was needed to be a specialized banking sector for musicians who otherwise couldn’t afford to record their music. Now that the technology to record, edit and distribute music is cheap it should be obvious that the recording industry should shrink and allow the composers and performers to appropriately dominate the music industry.

While this is the history and present, you couldn’t tell this from the Toronto Town hall. The predominant narrative was that the recording industry is critical to the music industry, and that it was unauthorized sharing (and nothing else) that needed to be stopped in order to protect jobs. There was no discussion of the history of the music industry, and how technology has always brought changes. There was no discussion of how many jobs would be lost not only in the music industry but across many other copyright sectors if the demands of the recording industry were actually met.

The evening closed with some humour. The Honourable Tony Clement (Minister of Industry) mentioned how he was thankful that the evening didn’t turn into a US health care style town hall. This was amusing because on Twitter this analogy was made only a half hour into the town hall. Speaker after speaker was using emotion rather than facts to present their positions in support of specific industry associations who stand to lose if good policy protecting the public interest was enacted. In the US there is often a token Canadian brought out to claim how horrible our system is, and in the Toronto Town hall there was a “proud pirate” that will be used as proof that the current system is broken and in need of the “fixes” the recording industry has been demanding.

There are now only 6 days left to make your voice heard on this critically important issue.

Russell McOrmond is a self employed consultant, policy coordinator for CLUE: Canada’s Association for Free/Libre and Open Source Software, co-coordinator for Getting Open Source Logic INto Governments (GOSLING), and host for Digital Copyright Canada.

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