New black spot for pirates in Canada

Updated copyright laws hope to address internet piracy.
Yaunna Sommersby
[social media specialist]

By now, most people are likely familiar with the anti-piracy warning included on DVDs: “Piracy is not a victimless crime.” Despite its dire words, in 2012 a study of BitTorrent users found that Canadians had the fourth highest amount of unauthorized musical downloads. But even with this reputation, in the same year many numbers for piracy were in fact decreasing: Michael Geist, a law professor at the University of Ottawa, noted in a 2012 online post that “legal markets for content have been expanding and revenues of the creative industries have been growing.”

Piracy takes on many forms, most notably including software, film and music. With the internet, pirating has become simple enough that pretty much anyone can do it–often without grasping the full impact the piracy has on the various industries.

Realistically, pirating a film may create positive exposure for the actors and the director, but what about those on the lower rungs of the industry? Between 1994 and 2013, the average film crew consisted of at least 588 employees. Man of Steel, filmed in Vancouver, boasted a crew of 2,543 people. This number includes the employees that work in everything from catering to lighting, costumes to transportation services.

The estimated budget for Man of Steel was $225-million, the number Warner Brothers had to reach in order to break even. With the presence of piracy, every project is an even greater gamble and studios have become cautious with their decisions in this internet era. In order for studios to release more films, they have to make money on the films they previously released. One illegally downloaded copy of a film is equivalent to one ticket or DVD sale that was not made, thus taking money away from the industry.

However, piracy is not a simple issue to unpack. Reports completed by the European Commission and OfCom have revealed conflicting results surrounding how lines can be blurred between the negative and positive effects of piracy. With Canada’s newest provision under the Copyright Modernization Act coming into effect Jan. 1, the conversation surrounding the morality (and legality) of piracy has never been more pressing.

Copyright Modernization Act

At the beginning of this month, the “notice and notice” program, the latest provision under Canada’s Copyright Modernization Act, came into effect. This new provision requires Internet Service Providers (ISPs) and website hosts to act as a middleman for copyright holders. If there is alleged illegal downloading activity detected at a customer’s Internet Protocol (IP) address, they will receive a notice through the new “notice-and-notice” system. The notice acts as a warning that the copyright holder has detected suspicious activity on the customer’s IP address. While the new law gives the copyright holder the right to sue, it does not specifically state that the customer has to stop downloading content.

According to Geist, the Copyright Modernization Act “offers greater flexibility with expanded fair dealing and new rights to create user-generated content.” He points out that the “notice-and-notice” system has been used informally for the past 10 years.

The overarching legislation impacting copyright law in Canada was reintroduced in 2011 by Christian Paradis, a Conservative Member of Parliament.

“Canadians will soon have modern copyright laws that protect and help create jobs, promote innovation, and attract new investment to Canada,” said Paradis in a 2011 press release. “We are confident that this bill will make Canada’s copyright laws forward-looking and responsive in this fast-paced digital world.”

Geist notes that copyright reform has generated intense debate for over a decade, adding that it’s “important to bring some closure to the debate and update the law.”

“With respect to infringement, the experience of the past decade suggests that the notice-and-notice approach is an effective tool.”

David Christopher, communications manager for Open Media, believes it is an effective system and, “Three-quarters of people just stop downloading and don’t get a second notice, presumably because they stop downloading content.”

Beyond updating the law, new services like Netflix and Spotify are addressing piracy in a different way: by providing convenient alternatives to piracy.

Role of Streaming

Christopher believes that having reasonable access to legal content is part of the issue of piracy.

“There is a huge desire to access a really wide range of content,” he explains. “Part of the problem here is that Canada, out of all of the G8 industrialized nations, has the most highly-concentrated media market. We’ve got a situation here where just a small handful of very large telecom conglomerates like Bell and Rogers completely dominate the media scene.”

Christopher also notes that Canada’s connection with Netflix is complex because large telecom organizations such as Bell and Rogers “make it difficult for companies like Netflix to license a really wide range of content.”

“Canadians overwhelmingly want the CRTC to open it up, take on these telecom giants and make sure that every Canadian can have a fair and reasonable way to access content online.”

The desire for content reaches the music industry, too.

Streaming services such as Spotify and Songza are legal, licensed programs that are supported by record labels and Music Canada.

“They are licensed, so they are much better than people using an unlicensed pirate service . . . Our labels are all big supporters of them and you can see they have their brand on almost all the digital services promoting their music, building the community there.” says Quentin Burgess, Communications and Digital Media Specialist for Music Canada.

Although these streaming sites still support the industry and musicians, some artists are still skeptical about the benefits. “Over the past year, some artists have expressed concern over the royalty rates. It is an issue that I think we are still seeing,” he says. “I think it really comes down to the artist and management team’s choice if they want to put it up there,” Burgess explains.

“It is easy to see the impact piracy has within the industry,” he says. “. . . It has contracted a lot since the days of Napster and we’re starting to see signs of growth. The writing is on the wall. People will continue to break laws, but what we’re hoping to do is encourage people to not get it in illegal ways, and [instead] get it through one of the licensed services.”

The Anti-Piracy Movement

Many creators of content have joined the anti-piracy movement in Canada, and are actively speaking out against unauthorized content.

“There are just so many options and it [pirating] is not supporting the people creating the music you love,” says Quentin Burgess, Communications and Digital Media Specialist for Music Canada.

“We’re very anti-piracy, and it is no secret that piracy has had a devastating effect on labels and music creators over the past 10 or 15 years,” he says. “I am sure it will always be a problem to some degree. Basically, what we are working on now is trying to convert people to those legal services that do pay the artist and right holder for their work.”

Burgess believes that the importance of copyright cannot go unnoticed because “it is the way that you can protect creative works.” Additionally, copyright not only protects the creative work, but job creation as well. “If people are pirating, it is not contributing to those careers–so it really is all about protecting creation,” he says.

“It is tough to change everybody’s mind, but the goal is to convert people who aren’t supporting the creators into using legal services, because the legal services that are out there now offer better product than what you can get through piracy.”

“When you have unchecked or unfettered piracy, that is really just a drain on the creators, the people who invest in them and record their music,” says Burgess. Educating people and raising more awareness about the effects of piracy could have a positive impact on both the film and music industries.

“It really comes down to the education that when you are pirating, you’re not contributing back to the people who create it,” says Burgess. He argues that piracy has a negative impact on musicians because, “it makes it harder for them to release their next record and it makes it harder for the labels to invest in that artist and even support the next generation of musicians.”

Privacy Concerns

With updated legislation working to protect creators of content, Open Media has concerns in ensuring the privacy of the general public is protected, and that the internet remains accessible.

Open Media “believes the internet needs to be accessible to everybody and it needs to be affordable to everybody,” says Christopher. “Internet access is a human right now according to the United Nations, and we need to get more clear and simple rules to protect people’s freedom of expression and privacy online.”

Christopher notes the Copyright Modernization Act “is balanced in the sense that it protects the privacy of the individual. The internet provider is not allowed to go to the copyright holder and give them the name and address of the person they believe is responsible, so it does have that privacy protection built in there.”

However, there is another piece of internet legislation that Open Media is monitoring: the Digital Privacy Act.

“There is one provision in particular that is really sounding alarm bells among privacy experts,” says Christopher. “It would allow telecom providers to disclose private information about their customers to pretty much any third party who accuses that customer of wrong-doing. Potentially, it would overwrite the balanced ‘notice-and- notice’ system that has just come into effect by actually permitting telecom providers to simply hand over the private information of their customers.”

“People have the same right to be private in their digital lives as they do in their non-digital lives,” he says. It is for this reason that Open Media believes the privacy of the general public should not be set aside when decision-makers create or amend copyright laws.

Open Media organized a major crowd-sourcing project last year that looked at how people around the globe feel about copyright rules, freedom of expression and reasonable content access on the internet. The study, which involved over 300,000 people, found that, “People really want fair and balanced copyright rules that make sure the artists are fairly compensated for their work, but also prioritize freedom of expression online,” according to Christopher.

Accessing content online “is really the wave of the future,” says Christopher. “And hopefully the decision-makers at the CRTC will listen to Canadians and open things up.”

“What I think we need is a system to balance the interests of artists and content creators, with the . . . privacy interests of the general public.”