Private copying regime irrelevant to satellite radio debate: Pfohl

Regulators don’t need to look to copyright law to impose anti-hacking conditions on yet-to-be-licensed subscription digital radio services, nor should they wait for their U.S. counterparts to finish a Federal Communications Commission (FCC) process on the matter before adopting made-in-Canada rules, argues the Canadian Recording Industry Association (CRIA). CRIA recently made the comments in response to arguments advanced by applicants vying for subscription radio licences. CRIA lawyer Richard Pfohl tells Canadian NEW MEDIA that writing anti-circumvention measures into the licence conditions doesn’t have to wait for the FCC, nor for a case related to Canada’s private copying regime to wind its way through the courts. There are currently two applications for licences for national satellite subscription digital radio services before the commission - one by a partnership of Sirius Satellite Radio Inc., Standard Broadcasting Radio Inc. and the Canadian Broadcasting Corp., and another by XM Satellite Radio and Canadian entrepreneur John Bitove. CHUM Ltd. in partnership with Astral Media is also proposing a terrestrial-based subscription radio service. Pfohl calls irrelevant the issue of whether copying music files from a satellite radio service would be protected under the private copying regime, as argued by some licence applicants, but which is now the subject of legal action. "I don’t think we need to get the copyright to get to what we’re asking for. Anyone has the right nowadays to protect music from being stolen. That’s what Apple does as a matter of course, what Puretracks does as a matter of course, what any of the online services do. It’s not illegal to take those steps to protect the music, simply because there’s a private copying exception, and it’s an exception, not a right. I don’t have the right to go to Apple iTunes and say, ‘Stop charging me $0.99 to download. I want to hack and copy anything that you have.’ Similarly, we’re simply saying that these services ought to take the same sort of steps that any prudent person who is making thousands and thousands of songs available online would take," Pfohl notes. "You’d certainly expect Puretracks or Apple iTunes to take those sort of prudent measures. In fact, these services take the measures themselves in terms of encrypting their signal so that it won’t be stolen. What we’d like (the radio applicants) to do is take the same steps for us that they take with respect to their own signal. You never need to reach the issue of copyright in order to get there. Whatever the outcome is of our court case is really irrelevant to what we’re asking for in this proceeding." Though confident the CRTC won’t heed calls by the applicants to turn the matter of signal protection over to copyright authorities, Pfohl still says CRIA has briefed Industry Canada and Canadian Heritage on its concerns. "We’ve raised the issue with Industry and Heritage at this point, but we do think that the CRTC does indeed have jurisdiction and that it should act in this case, and that they are in many ways the ideal people to act because what they can do is simply impose a condition of licence and say, ‘You need to do something to take this into consideration,’ and then we can sit down and work out the details with the services. As we’ve said in our intervention, we think that this is perfectly within the jurisdiction of the CRTC." CRIA also rejects the argument made by applicants that the CRTC should wait on imposing conditions of licence until the FCC has also looked into the issue. "The idea that Canada should not have its own broadcasting and telecommunications policy until after the U.S. acts, I think, is really an insult to Canadians. The CRTC is charged by statute to act in Canada’s best interests and it is not an excuse for the CRTC to say, ‘Well, we have to follow the lead of the U.S. on this.’ The Broadcasting Act doesn’t say that the CRTC must act to protect Canada’s interests except if the U.S. is a bigger broadcast market. And, in fact, in numerous instances, the CRTC has taken positions that are diametrically opposed to the FCC. Canadian content rules are just one example." Pfohl adds that he believes the imposition of digital rights management on digital radio services isn’t an onerous requirement, and that the CRTC must ensure that the applicants have complete control over their systems before offering service, including the ability to protect songs from being copied. He notes, however, that services such as XM have already begun to market their offering as an alternative to file-sharing services, with the same ability to build customized playlists. He cites the MyFi receiver/recorder as one example. "So, they’re already trying to poach from the legitimate online services and there’s no indication that they’ll necessarily stop at automobiles. Another applicant, Sirius, referred to their objective as creating the ‘iPod in the sky’ with ‘thousands and thousands of hours of memory,’ a device that does ‘all the work for free.’ All that seems to me to indicate that they’re looking to get into providing – well – you can draw your own conclusions from those statements." While the applicants for digital and terrestrial radio services have played down the piracy risk by saying that it’s primarily intended for use in vehicles, Pfohl says the likelihood of misuse by individuals is high. "They’d have to purchase software, which is readily available on the Internet – sold by someone based in Ottawa at this very moment. To get that software is not a problem. But any person who’s stealing thousands of songs is a potential problem. "Currently that software is available for $29.99. We don’t know what the scale of this problem potentially is. We do know that people are freely advertising on the Internet that you can record any song that you want, you can create your own digital library, you can cherry-pick and just record the ones that you want to record. There have been studies that have been done, now, that say that people will purchase such services. We put into evidence before the CRTC a study done in the U.S. that says 65% of the adults indicated that they would use a cherry-picking feature to record their favourite music. If you were told that for $10 per month you can have thrown in free every song that you ever wanted, it seems to me that there’s a large market for that," Pfohl says. He also rejects an argument by the applicants that too-strong protections on Canadian receivers will create a grey market as Canadians seek to purchase services from the U.S. where there may be fewer restrictions on how the equipment can be used. "It’s effectively a free rider problem that absolutely needs market correction, and the CRTC is in the position to correct that sort of market inequity that a regulator would need to step in to correct. With respect to the grey market, itself, I think that that’s a red herring. There’s thousands of businesses today in both the U.S. and Canada that are only allowed to sell certain services or products to citizens in their own respective territory, and they are able to do that without any real problem and that the example that comes to mind is, until (just recently), Apple iTunes was not available to Canadians. They were able to do a simple reverse checkup in terms of your IP address. "Conversely, Puretracks was not allowed to sell to U.S. citizens. They took the simple steps in order to check where you’re coming from. These services are subscription services. They will be offering this service on a monthly basis. Each month, someone will be paying for that service. It’s a simple matter of checking the address associated with the credit card. It is true that it’s possible that in some instances there may be Canadians who have a U.S. address who could have their mail shipped from that U.S. address every single month to them in order to pay their bill on that card. But, I think that that’s exceedingly rare. "The idea that that would drive Canadian policy, the idea that the Canadian government should not act in what it thinks is Canada’s best interest because it’s possible that people would try to sneak across the border and play by rules that aren’t in Canada’s interest should not be the determining factor in determining Canadian video and telecommunications policy. Canada ought to do what’s right for Canada."

Private copying regime irrelevant to satellite radio debate: Pfohl

News | 12/16/2004 5:00 am EST

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