Graham Henderson Click here to see full sized version.

Record companies, despite what you may have heard from what amounts to a co-ordinated disinformation campaign, are enthusiastically embracing the digital marketplace. They understand that people want to enjoy music in a variety of ways that were not anticipated a decade ago.

But they have always taken as their guiding principle that artists must be paid. And they have worked hard to build business models that respect both artists rights and consumers desires.

The digital marketplace is blooming in the rest of the world. The International Federation of Phonographic Industries (IFPI) recently reported that in Europe and America, legal digital music has moved into the mainstream of consumer life. Music fans throughout the world are migrating back to the legal marketplace. This is not surprising, because taking music without paying for it offends values that most people hold dear — respect for private property and the right to be paid for one’s labour.

But due to our antiquated copyright laws, the same cannot be said for Canada. According to industry estimates, the maturity of our digital marketplace lags well over a year and a half behind the rest of the world.

Canada’s cultural products, our “products of the mind”, are today subject to theft on a massive, almost unthinkable scale. Many people think that everything that can be digitized is free — that is to say, if it is on the Internet, they can do what they want with it. According to a recent Pollara study, each month Canadians expropriate without any compensation, 134,000,000 music files. Artists get nothing in return. By contrast Canadians legally download a mere 1,000,000 tracks per month.

The only reason this becomes possible is because these people have absolutely no respect for copyright. And this type of thinking hits squarely at one of the components of our economy that Canadians excel at — the creation of products of the mind. The Government of Canada, in its report A Framework for Copyright Reform (2000) noted that the GDP of the copyright-related sectors is $65.9B, accounting for 7.4 per cent of Canadian GDP. The government concluded that Canada’s copyright-related sectors constituted “the third most important contributor to [our] economic growth”.

Now, it should be said that there is nothing wrong with authorized file sharing. But the choice to engage in this form of promotion must be the artist’s choice, not a choice made for them by expropriators. Our current legal system takes choice out of the hands of the artists and rights-holders and puts it in the hands of hackers and thieves.

Those ideologues who don’t want to give artists a choice, talk very loosely about how copyright reform could in theory stifle innovation. They base this on anecdotal conjecture and urban myths. The U.S. Copyright Office has recently debunked this baseless speculation authoritatively. In Canada, the effects of our failure to enact copyright reform are everywhere – massive job losses coupled with artist careers that either couldn’t get off the ground or that have crashed and burned. Opponents of copyright reform seem to want the marketplace for cultural products to fail — for reasons that appear to have an ideological underpinning. Their attitude to the scope of the debacle is eerily similar to that infamous soviet dictum, “you have to break a few eggs to make an omelet.”

In such a legal environment, it is not surprising that young Canadian independent labels and artists in search of investment have been disappointed to find it nearly impossible to obtain.

Private investors consistently repeat what they read in the newspapers — that kids are stealing music with impunity. They consider the music industry to be the Wild West — no laws and no marshals. But most importantly, they do not invest because they see no opportunity for profit.

Copyright reform offers us the chance to change all of this. It is important because if we wish to remain competitive in the international marketplace, it won’t be by extracting natural resources or by making cheap widgets — someone, somewhere else, will always be able to dig deeper or make cheaper widgets. It will because we are among the best at creating products of the mind — the very products that the opponents of ratification of the World Intellectual Property Organization (WIPO) treaties would devalue and weaken. We should be standing up for these rights. We should be fortifying them, not watering them down.

I think we need a national conversation on the nature and importance of products of the mind. This dialogue should take place in our marketplaces, our schools and our homes. And while this conversation can start today, in order for it to be truly effective, our country must ratify the WIPO treaties to bring our copyright laws out of the 19th and into the 21st Century.

Graham Henderson is the president of the Canadian Recording Industry Association.