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Standing Committee on Canadian Heritage releases Review of the Canadian Music Industry report

Yesterday, the Standing Committee on Canadian Heritage released its Review of the Canadian Music Industry report, available at http://www.parl.gc.ca/Content/HOC/Committee/412/CHPC/Reports/RP6661036/412_CHPC_Rpt05_PDF/412_CHPC_Rpt05-e.pdf.

Music Canada applauds the Committee for its comprehensive study of Canada’s music industry, and thanks the Committee members for their care in considering testimony from witnesses across many different facets of Canada’s music industry. The Committee held 14 meetings on the study, hearing from 82 witnesses and receiving 15 briefs. This process allowed the Committee to hear from stakeholders from areas that they may normally have less opportunity to interact with, such as music education and music tourism.The Committee report focuses on five themes:

  • Digital distribution and streaming
  • Music education
  • Music tourism
  • Current funding – future investment
  • FACTOR/Musicaction

The report gives an overview of the current state of the Canadian music industry, summarizes witness testimony on the five themes, and considers outcomes proposed by witnesses on each theme.

The report provides the government with ten recommendations for strengthening its support for the Canadian music industry:

  1. The Committee recommends that the Government of Canada examine the time that it takes for decisions to be rendered by the Copyright Board of Canada ahead of the upcoming review of the Copyright Act so that any changes could be considered by the Copyright Board of Canada as soon as possible.
  2. The Committee recommends that the Government of Canada work with provincial authorities and other stakeholders to improve the musical knowledge and skills of Canadians.
  3. The Committee recommends that the Government of Canada work with stakeholders in order to launch an information campaign on the actual cost of creating music, the negative impacts of illegal downloading and the importance of respecting the intellectual property of music creators, with an outcome of assisting the music industry in terms of improved measures and initiatives related to these issues, including preventing piracy.
  4. The Committee recommends that the Government of Canada work with stakeholders from the Canadian music industry and the Canadian tourism industry to make music tourism in Canada a focus of marketing campaigns.
  5. The Committee recommends that the Government of Canada study the economic impact of introducing a tax credit to support the Canadian music industry, taking inspiration, if needed, from those granted to the film and television industries.
  6. The Committee recommends that the Government of Canada undertake a study of the impact of digital technology on the Canadian music industry and on government funding programs.
  7. The Committee recommends that the Department of Canadian Heritage ensure that the various components of the Canada Music Fund reflect the changes in Canada’s music industry, including potential new sources of funding from the private sector, with special attention given to creators, entrepreneurs and independent producers.
  8. The Committee recommends that the administration of the Music Entrepreneur Component of the Canada Music Fund be transferred from the Department of Canadian Heritage to a new third-party organization(s) based on the model of FACTOR and Musicaction.
  9. The Committee recommends that the Department of Canadian Heritage ensure that the general public and recipients are aware that FACTOR and Musicaction funding is made on behalf of the Government of Canada.
  10. The Committee recommends that the Government of Canada give the Canadian Radio-television and Telecommunications Commission the capacity to enforce the requirement for the private broadcasters to pay, in a timely manner, the required annual contribution for Canadian content development

It is positive that the Committee recommends the government examine the time it takes for decisions to be rendered by the Copyright Board of Canada ahead of the upcoming review of the Copyright Act. Numerous witnesses, including Music Canada, identified the length of time for decisions to be rendered by the Board as a cause of uncertainty in the legal landscape and a deterrent to progress. As the report notes, a dozen witnesses identified insufficient resources as a reason the rate-setting process is so lengthy. We support providing the Copyright Board with the proper tools, personnel and financing to function more as a business development office, as well as Parliament allowing rights holders and digital services to do deals directly at fair market value.

We are very pleased to see the Committee recognize the importance of music education to all Canadians. As the report notes, the positive effects of music education came up repeatedly during the Committee’s study, with several witnesses urging support for music education as it fosters critical thinking, imagination, self-esteem, and self-discipline, assets which are useful in an economy based on information technology and communications. It is gratifying to see our Next Big Bang report cited on this point in the report.

We are supportive of the Committee’s recommendation that the government work with stakeholders to develop information campaigns on the value of music, the negative impacts of illegal downloading, and the importance of respecting the intellectual property rights of creators. We would be very happy to work with the government in developing these campaigns.

The Committee’s recommendation that the government work with stakeholders from Canada’s music and tourism industries to make music tourism in Canada a focus of marketing campaigns is a very positive step. This study allowed the Committee to hear of the opportunities in music tourism from stakeholders such as North by Northeast, Live Nation Canada, and Ticketmaster Canada, all of who identified the enormous potential for in Canada’s live music sector. As well, the Committee heard from the Canadian Tourism Commission, who identified music as an important part of its marketing and tourism offerings, and the Tourism Industry Association of Canada, who remarked that music and culture are “leading drivers for American visitation.”

We are very pleased to see the Committee recommend the study of introducing a tax credit to support the music industry, taking inspiration, if needed from the existing tax credit system for film and television industries. The development of artists is a form of R&D and is deserving of public support, similar to the tax credits available in other R&D-intensive industries.

The Committee requests that the government table a comprehensive response to the Report.

The report has the support of the three main parties, with some additional recommendations made by the New Democratic Party and the Liberal Party. In particular, the Liberal complementary report suggests more comprehensive changes to Copyright Board based on testimony from witnesses.

Music Canada urges the government to support the findings of the report and looks forward to working with the government on implementing its recommendations.

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