• IFPI Illogically Blames 'Weak Legal System' In Canada For Declines In Music Sales. Does Not Reference Cassingle Sales For Some Reason.
  • May 14, 2010 | Author: Kenneth Clark
  • Law Firm: Aird & Berlis LLP - Toronto Office
  • The International Federation of the Phonographic Industry, (IFPI) a recording industry association, released its Recording Industry In Numbers press release on April 28, 2010.

    Although overall music sales and sales of (shall we say obsolescent?) physical media declined, sales of digital forms of music, live music sales and songwriters’ copyright revenues continued to grow.

    Not-so-buried in the statistics were editorials against music piracy, which took a particular aim at Canada’s legal system, claiming (in my opinion, ignorantly) that, “Spain (-14.3%) and Canada (-7.4%), countries with some of the world's weakest legal defences against piracy, show the sharpest falls, along with Italy, over a decade among the top 10 markets. Spain, where illegal file-sharing is more than double the average rate in Europe, has seen the biggest market fall, down 60% since 1999. Canada, practically the only government of a developed country not to have implemented international copyright treaties agreed over a decade ago, is a major source of the world's piracy problem. A disproportionate number of illegal sites are hosted on Canadian soil.”

    Of course, the same article states that 80% of the lost sales were in the United States and Japan, both of whom have the strongest forms of legal defence against piracy. Clearly, the legal system is not the sole, or even the most important, factor in the decline of music industry sales. Of course, this is not to belittle the effect of music piracy, which should rightfully be stamped out.

    While it has become a major sport for foreign companies to criticize Canada’s copyright laws, in fact, Canada’s Copyright Act contains what can only be described as the strongest legal protection for any asset in Canada. Seizure of goods prior to judgement or even filing of a defence is available, as are statutory damages for hard-to-prove cases where specific damages are difficult to determine. Criminal charges can be laid for copyright infringement. Timely registration of copyright can eliminate major evidentiary hurdles at a microscopic cost. Wide injunctions can be obtained for families of works not at issue in the main litigation. The list of extraordinary remedies goes on.

    What the IFPI, and the recording industry in general, fails to recognize is the law is not the issue. The issue is the will of the owners of intellectual property to spend the money required to take cases to trial. Enforcing rights is not easy to do, but it has been done with success in the past. It just requires will and the appropriate resources. That is not to say the Copyright Act couldn’t do with an overhaul to deal specifically with the new technologies that have reduced distribution costs of raw product to almost nothing, making copying extremely easy.

    In my opinion, the basic fact that distribution is now essentially free, coupled with the advent of Pro Tools and its ilk, software which drastically reduces the cost of recording an album, has reduced the need for record companies and their “one winner for ten losers” business model of yesteryear. For that matter, as we can see in the trouble financial circumstances of BLOCKBUSTER, retailers of physical media are going the way of the buggy whip (or, should we say, the cassingle). Desperate legal manoeuvres will not halt the inevitable technological dismantling of an industry that relies on crumbling barriers to entry to maintain its position.