The Songwriters Association of Canada proposes a $5 monthly fee on subscribers’ Internet bills that would make it legal to download music and hopefully save the failing music industry.



THE PROBLEM

Sales of CDs are down 20 per cent worldwide and 35 per cent in Canada, compared to 2006.

An estimated 1.6 billion music files are downloaded in Canada each year on "grey-market" peer-to-peer systems, representing $1.6 billion in lost revenue, using the iTunes price model of 99 cents per download.

The total number of purchased downloads in Canada was 38 million in 2005. The ratio of shared to paid downloads is 98:2 (98% shared files vs. 2% purchased downloads).

Virtually every song ever recorded is available through peer-to-peer file-sharing (more than 79 million recordings). Only 3 million songs are available on legal sites.

Sources: Songwriters Association of Canada; Canadian Record Industry Association; PricewaterhouseCoopers LLB

WHAT'S THE PLAN?

SAC is calling for the creation of the Right to Equitable Remuneration for Music File Sharing, which would make it legal to share music on peer-to-peer networks in exchange for the monthly fee. The fee – amounting to an estimated $500 million to $900 million annually in Canada – would be administered by a collective of artists, songwriters, music publishers and record labels. "Monetizing peer-to-peer file-sharing would generate significant new revenue for creators and the music industry," says acting SAC president Eddie Schwartz, "and re-establish revenue levels (for songwriters) that we haven't seen since 2000-2001."

THE FORUM

SAC, which represents the interests of Canadian music composers and lyricists, is advancing its radical proposal at a public forum tomorrow at 7 p.m. at Oakham House at Ryerson University. It hopes this will be the first step towards legitimizing peer-to-peer music file-sharing activity in this country – and perhaps eventually all over the world – while compensating music creators at the same time.

For more information go to songwriters.ca, or call 1-866-456-7664.

WHAT'S IN IT FOR CONSUMERS?

SAC argues the fee would remove the stigma of illegality from file-sharing and represents exceptional value to the consumer, since it would allow unlimited access to the majority of the world's repertoire of recorded music.

The plan renders digital rights management and the legal protection for digital locks, which prevent copying and file-sharing, "obsolete," Schwartz says. "The simple truth is that there's no way anyone can stop free file-sharing. It's exciting to discover new music and natural to want to share it. File-sharing isn't about the marketplace, it's social activity, a way to seek out like-minded people, and music has always been used that way. The SAC proposal may not be the silver bullet that saves the music industry, but it could be the greatest opportunity independent artists and music consumers have. There are no middlemen, no gatekeepers, no owners of the means of music distribution in this proposal. Consumers can interact directly with the creators of music."

WHAT ARE THE OBSTACLES?

Internet Service Providers may resist adding $5 to customers' monthly bills.

The four major record labels, which have traditionally dominated music distribution, oppose all attempts to establish alternatives or competitors.

The federal government, which will have to be convinced of the merit of the changes in the Copyright Act, is reluctant to intervene in the marketplace unless in the public interest.

Songwriters and authors will have to give up their long-established right to approve or disapprove of the use and means of dissemination of their work. The only right they will have is the right to be paid for peer-to-peer downloads.

Internet users who do not download music – paid or otherwise – will balk at paying an extra $5 a month.

Source: David Fewer, staff counsel with the Canadian Internet Policy and Public Interest Clinic at the University of Ottawa, Faculty of Law

CHORUS OF SUPPORT

"I wholeheartedly believe that this model for file-sharing should be embraced in all countries. Let's get it rolling and it can be a template for other performing rights societies throughout the world. With dwindling record sales because of the thievery, this might be the new paradigm of income source for all songwriters."

–musician Randy Bachman

"The Canadian Music Creators Coalition endorses the Songwriters Association of Canada in pushing this proposal forward. We think the Canadian government should be facilitating discussion over the merits of this forward-thinking approach. This is the first progressive proposal we've seen in Canada to address file-sharing ... a made-in-Canada approach to (the issue).'' –Andrew Cash, spokesperson for the organization that monitors legal and policy issues affecting Canadian musicians

"With the Internet I have virtually unlimited access to millions of music files. Amazing, right? Well ... yes and no. I'm a songwriter. Songwriters create ideas. We're inventors. Think about the light bulb and the telephone. People don't mind paying for their telephone and electricity each month, but somehow they think music should be free. The truth is, music has value too. We believe access to online music should remain unlimited. We're just asking that the value of our music be acknowledged and that we be fairly compensated."

–Bryan Adams collaborator Jim Vallance

"I think if there was an ISP tax of some sort, we can say, `All music is now available and able to be downloaded and put in your car and put in your iPod and put it up your ass if you want, and it's $5 on your cable bill.'"

–Trent Reznor, Nine Inch Nails







