Record companies disappointed with silence on piracy in radio decision

The Canadian recording industry lobby hasn’t decided yet whether or not to appeal this month’s CRTC subscription radio decision, with which it is "deeply disappointed." The Canadian Recording Industry Association (CRIA) is unhappy because the commission failed to impose any conditions on the three new subscription radio licencees that would protect against digital piracy. CRIA head Graham Henderson tells Canadian NEW MEDIA he hasn’t ruled out an appeal of Broadcasting Public Notice 2005-61 pending discussions with other industry players and the lobby group’s board of directors. PN 2005-61 granted licences to all three applicants: 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 – both of which are planning delivery via satellite – along with CHUM Ltd. in partnership with Astral Media that proposed a terrestrial-based subscription radio service. The decision was widely expected. Last year, during a hearing into whether the CRTC should license any of the radio hopefuls, CRIA described to the commission the need for digital rights management and encryption standards as a condition for entry into the market. At the time, CRIA expressed fears about the potential for massive signal theft. In an interview with CNM last December, CRIA’s counsel Richard Pfohl outlined the potential problem: "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 said. Despite a written submission to that effect to the commission, which Pfohl characterized as them asking for the "same sort of steps that any prudent person who is making thousands and thousands of songs available online would take," there is nary a mention by the commission of those concerns amid the many and controversial conditions of license that were applied to the three hopefuls. The absence of any injunction against launching without technological protection measures in place has Henderson expressing frustration. In the wake of the publication of the decision, he tells CNM that: "It’s as if we went up there and sat in a dark room and talked to ourselves. They didn’t even aver to the fact that it was an issue. And, I have to say, that’s a huge problem for us. I mean, this is a legitimate concern, a concern that was legitimate enough that it was recognized as being legitimate by one of the three applicants, who happily announced before the commission that they would implement some content protection and would happily work with us…We feel like we’ve wasted our breath." CRIA is now considering its options, which may include an appeal of the ruling. Besides launching one independently, the association may be able to hitch its concerns to one of what will likely be a series of appeals by groups unhappy with the ruling. Those include Friends of Canadian Broadcasting, which is concerned about the level of American radio programming that will be beamed into the country. Friends will likely be backed by a half dozen arts groups or so. Henderson also says groups such as the Canadian Independent Record Production Association, ADISQ, SODRAC and others are upset by the flood of U.S. programming. "I can’t imagine that they wouldn’t appeal. I think the ADISQ press release called it ‘catastrophic’ for Francophone artists," he says. A CRIA press release notes: "The CRTC’s failure to ensure that the new digital subscription radio services hold the line against music piracy is short-sighted and a tremendous disappointment. There are relatively inexpensive and simple technological fixes out there. We had offered to work with the services, but the CRTC elected not to address this important issue. Furthermore, it threatens emerging online music businesses that are the natural partners of digital subscription services." Says Henderson: "I don’t think our opinion has changed one jot, and, you know, what we just have to decide right now is are we appealing individually, or are we going to join someone else’s appeal? And, until I’ve had an opportunity to fully consult with the board, which I haven’t, unfortunately, I just don’t have a clear cut answer for you on that. But our press release sums it up. We’re very deeply disappointed." A detailed look at broadcaster and other stakeholder response to the CRTC’s decision is available in the June 24 issue of affiliate publication Canadian Communications Reports.

Record companies disappointed with silence on piracy in radio decision

Broadcast | June 24, 2005

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