Legal loophole that gave birth to iCraveTV won't be closed anytime soon Film producers and broadcasters may have succeeded in shutting down iCraveTV.com, but it appears the Canadian government isn't in any hurry to close the legal loophole that gave life to the renegade Internet broadcaster. On Feb. 28, iCrave president William Craig succumbed to intense legal pressure from Hollywood heavyweights, saying he would stop broadcasting local TV signals on his Web site if the various lawsuits against his company were dropped. The announcement was more of a retreat, than a surrender. The company is now negotiating with rights holders for permission to stream their content on the iCrave Web site. It's also putting the final touches on a technology that will prevent non-Canadians from viewing TV signals not authorized for foreign markets. Craig may have acquiesced for the moment, but he still maintains that his service is allowed under federal legislation. He might well be right. Amending the Copyright Act, however, is an arduous and contentious exercise at the best of times, and the prospect of wading into another lengthy public process isn't topping the wish list of senior government officials. Still smarting from the recent fallout over tape licensing fees and other royalty issues, bureaucrats have chosen to proceed slowly and cautiously to close a loophole that appears to give Internet broadcasters the same freedom as cable operators when it comes to picking up and retransmitting local broadcast signals. Alex Himelfarb, deputy minister of Canadian Heritage, doubts the Copyright Act will be reformed before the next election. "I can't see it happening this fiscal year or perhaps not even in 2001, (though) we have launched the necessary work with our partners on a copyright legislative reform," he told Canadian NEW MEDIA. "We're obviously monitoring this very closely to see if our current legislative framework does provide the protections (rightsholders) are seeking." As part of this process, the department is also looking at broader ways to protect the rights of artists, creators and producers. "It does look like this will require changes to our copyright framework. We have begun that process, but I can't promise you it will be quick, even if the issues are moving at an unbelievable rate," he says. Heritage's assistant deputy minister of cultural development, Michael Wernick, says dealing with iCrave is one of several rights issues that needs to be addressed over the coming months. But to move quickly on any of them, he says you need the political support of Heritage minister Sheila Copps and Industry minister John Manley. "And neither minister is excited about taking on the Copyright Act issue again," explains Wernick. "Bill C32 (1998's so-called Copyright 2) had the all-time record for the number of lobbyists registered for one bill. We've finally finished all the regulations on that bill, and they're coming into force." The biggest obstacle politicians and bureaucrats face in resolving copyright problems, says Wernick, is the lack of consensus within the industry itself. "Everyone has a different agenda," he notes. "There are so many issues, like Crown copyright, policing, folklore issues, digital, databases. People are telling us that we have to deal with ISP liabilities, others want us to deal with the 20-year extension the U.S. just did (which gives heirs of intellectual property the rights to the material for 70 years after the death of the author). But people in the industry want the government to show its cards first. If stakeholders agreed to leave their weapons at the door and deal with the issues, then we might be able to do something." Overhaul versus tinkering McCarthy Tetrault lawyer Peter Grant, who represented a coalition of producers' groups and Global Television Network in the iCrave case, suggests the Copyright Act needs little or no tinkering to prevent companies like iCrave from operating outside the law. "I would argue that the Internet is brought under the Copyright Act because you don't use or exploit other people's material without their permission," he says. "The retransmission section was always intended to be a very narrow exception to grandfather an industry (cable TV) that we know and love. It was never intended to cover iCrave." iCrave is taking advantage of an apparent loophole in the Copyright Act that was created when the Canadian Radio-television and Telecommunications Commission decided last year to leave the Internet unregulated. The decision left unclear the issue of whether companies like iCrave qualify for a compulsory license under the Copyright Act, one that would allow them to pick up and re-transmit over-the-air broadcast signals, as long as they pay into the relevant copyright collectives. Grant says it's a problem that requires only minor fixing. "After that dust settles, I think we probably all will take a close look at the Act to see if there is a relatively minor amendment to the Act that would make clear what we think is there," he notes. It's doubtful those minor amendments can deal with the gamut of issues concerning digital content and the Internet. Speaking to delegates at last month's Canadian Film and Television Production Association conference in Ottawa, Roma Khana said the government must act quickly to introduce so-called "digital" legislation. "We can plan and think ourselves to death and not change the copyright law, and not have digital legislation," said Khana, CEO of Snap! Media, of Toronto. "Or we can just put legislation in place, and maybe half of it gets struck down, but at least we're moving forward- We shove square pegs into round holes in Canada and say, this thing might fit into this law."