Breaking the Waves





Plans to increase the cost of broadcasting music is “a slap in the face” to Canadian radio broadcasters, says Rob Farina, vice president of programming for CHUM Radio in Toronto.

“I don’t think anybody disagrees that there should be a copyright payment for the use of musical works,” Farina says. “The amount and the different layers are becoming a huge problem.”

Between paying artists, publishers and labels, it’s getting expensive to be a Canadian radio station.

Recently, the Audio-Video Licensing Agency and la société de gestion collective des droits des producteurs de phonogrammes et de vidéogrammes du Québec (SOPROQ) proposed a new tax on sound recordings to Canada’s copyright board, which would deal broadcasters a fee increase of about 170 per cent in just 24 months.

In 2006, the total fees paid by all music-playing Canadian radio stations amounted to $74 million, up from $22 million in 1995. If the tariff is approved, the fees will jump to $200 million by the end of this year.

The Canadian Association of Broadcasters has formally countered the AVLA’s new tariff through the Copyright Board of Canada, which will make its decision by December.

Pierre Pontbriand, vice president of communications for the CAB, says such an increase would severely affect every station in Canada.

“Broadcasters would have to look individually at how they can assume these additional costs, and whether they can assume them,” he says. “The copyright fees in some stations would become the most important budget item.”

Pontbriand says Canada’s copyright system, which is currently under review by federal Industry Minister Jim Prentice, does not reflect the reality of today’s broadcasting industry.

“Broadcasters have always paid copyright royalties,” Pontbriand says. “The issue is not about paying or not, but there has to be the right balance.”

Lyette Bouchard, diréctrice generale ajointe of SOPROQ and diréctrice generale of ADISQ, a non-profit organization that aims to help the music industry in Quebec, says imposing a tariff is within the rights of production companies.

“It is only legitimate to exercise the right that is granted to us,” Bouchard says, adding that the rights of music makers and performers were updated in the 1997 Copyright Act. Which, according to Bouchard is a possible reason for the newly proposed taxes.

Music is a primary resource to radio stations so it only makes sense for stations to fork over hefty payments, says Bouchard.

“They need the music in order to be a radio station,” she says. “Of course they are playing our music, but they have to pay for this primary resource.”

The Copyright Board will set what it considers an appropriate amount for the tariffs.

 “I don’t think they are high enough,” Bouchard says. “Ask the other collectives, they will tell you the same.”

Farina says expensive fees do not reflect the promotional value of radio.

“Radio continues to be the number one way that people find out about and discover new music,” he says. “We have an important role in playing breaking artists and promoting their music and driving record sales.

“So now we’re not only expected to do that but we are expected to pay top dollar for the privilege,” he says.

Another hurdle for radio stations is a tax on the transfer of music from CDs to hard drives, says Michael Geist, a University of Ottawa professor and columnist specializing in law and technology.

“The issue is the ephemeral rights to and the payments that are made effectively to transfer music from CD to hard drive,” Geist says. “It discourages using innovative technology in industry.”

Farina says Chum Radio has encountered this problem, which adversely affects stations.

“One of the things radio would have to do to operate and provide the service we need to is turn back the hands of technology,” he says. “In Ottawa we still play everything directly off CD… which is ridiculous.”

Radio supports the nation’s music industry through other ventures than just straightforward promotion, Farina adds.

“One of the things we can’t forget here is that radio pays an unbelievable amount of money through Canadian content development initiatives… to support and develop talent,” Farina says. “There’s already a tremendous amount of money flowing into the industry.”

“You have to look holistically at everything radio is doing,” he says. “It seems like radio is being called on almost exclusively to prop up the record industry.”