Mr. Chair, thank you very much for inviting me to take part in this presentation to your committee today on behalf of CARAS, MusiCounts, and the Juno Awards.
The Canadian music industry is a billion dollar a year business encompassing sound recordings, songwriting, publishing, management, and live performances, and it employs thousands of Canadians.
There has been significant turmoil in the music industry over the past 10 years due to the change in how Canadians consume music. The media formats have changed from physical to digital, from radio and television to online, and in many cases from paid to free.
There has been a large decrease in revenues in the music industry due to these changes. In order to support change in this business model, one of the most important things we do is provide exposure to the incredible music talent this country has to offer through showcasing, social media, broadcasts, online streaming, and building a foundation for talent through music education in our schools.
CARAS, a non-profit organization, showcases Canadian musical talent through the Juno Awards broadcast, and year round through cultural events and partnerships with community organizations. The mandate of CARAS is to promote and celebrate Canadian music and artists. It is critical that we continue to preserve, protect, and support high-quality programming like the Juno Awards to share with Canada and the world the immense talent this country has to offer.
Over the last decade the Juno Awards have travelled across Canada. We have been engaging the entire country in Canadian music as we award 41 different Junos in all genres of music, including pop, jazz, classical, francophone, aboriginal, and country, just to name a few, which truly encompass Canada's national spectrum of culture and musical diversity.
The economic impact has been over $10 million in each city the Juno Awards has visited, providing a substantial boost to local businesses, including hotels, convention centres, restaurants, transportation, and music venues. In the past 10 years there has been over $100 million in economic impact to Canada.
However, federal funding through FACTOR, Canada's private radio broadcasters, and the Department of Canadian Heritage's Canada Music Fund for the Juno Awards has remained stagnant for the last four years. While production and operating costs for the Juno Awards continue to grow, the proportion that is funded by FACTOR has decreased. For example, over the past 10 years FACTOR funding for the Juno Awards has gone from about 10% of production and operating costs to less than 4% now.
In order to succeed, we must receive funding from the federal government that grows in proportion to the ever-increasing cost of producing the broadcast, as well as the cost of the initiatives that promote and showcase Canadian artists and their music. This need is based on several factors: the increase in costs associated with adapting to technological change and maintaining a very comprehensive and cutting-edge media strategy; the increase in travel costs for artists and talent to participate in the broadcast; the increase in broadcast production costs; the decrease in funding available from private record labels that have significantly contributed in the past but can no longer sustain the level of support due to declining revenues; and the potential decrease in broadcasters' contributions due to their business realities.
Most importantly, though, we must ensure that we continue to create musical talent in Canada to support the music industry and keep our culture of music alive within all Canadians. One of the key strategies that will foster this foundation is music education. Every artist had to start somewhere, and for many, the first opportunity was in the classroom.
MusiCounts is Canada's music education charity associated with CARAS and the Juno Awards. We believe that regardless of socio-economic circumstances or cultural background, every child deserves the opportunity to learn how to play an instrument. For the last 17 years, MusiCounts has awarded nearly $7 million in grants and scholarships right across the country to help support music education in our schools and communities.
In a perfect world we wouldn't need to exist, but unfortunately school cutbacks have put music education at risk. All too often, music and other arts programs are the first to be cut, and unfortunately, they're not seen as core curriculum. We believe this must change. Last year MusiCounts received approximately $5 million in funding requests alone to help support music education, but unfortunately, the need far outweighs what we can provide.
Many studies have shown the benefits of learning to play a musical instrument. Music education nourishes self esteem. It teaches team work and discipline. It keeps students engaged, and it helps create a respectful community.
But it's not just about nurturing the next Juno Award winners. It's about creating better citizens and a stronger workforce equipped for the digital economy.
Commander Chris Hadfield spoke at one of our events about the role music played in making him a better astronaut. President Bill Clinton was once quoted as saying that he would not have become president if he hadn't taken music classes from grade 7 to grade 12. Of course, we all know how our own likes to play music, as well. But perhaps the most basic reason that we believe every child must have a music education is that music is an important part of the fabric of our society. Every human culture uses music to express their ideals.
Music Canada's report on the music industry, “The Next Big Bang,” illustrates very well the numerous benefits of music education and makes a very strong case for better support from all levels of government. In this study, Music Canada cites music education as the first of five key pillars that will help reinvigorate the music industry in the digital age.
Music is a sometimes overlooked but still important foundational component both in preparing workers with the necessary skills to take part in the digital and creative economies and in attracting and retaining them in vibrant cultural scenes. The importance of music to our economy is without doubt.
Now MusiCounts has also been impacted due to changes within the music industry. The record labels, once our main contributor but still a very strong supporter, have had to cut back their annual contributions. We now have to reach far beyond the music industry for funding.
Just over a week ago at the Juno Awards in Winnipeg, I had the pleasure of taking part in the round table, where Graham Henderson of Music Canada actually introduced a very interesting concept. For years the federal government has supported the physical well-being of our nation through the ParticipAction program. What if we actually worked together to create a program that encouraged Canadians to reap the benefits of music education, a music ParticipAction program of sorts that gives people the same support, tools, and motivation as that for physical activities? For many students who may not be athletic or socially active, we like to say that music can be the great equalizer. A program like this could enlighten our nation to the benefits of music education in the same capacity that ParticipAction has.
I've spent 25 years in the music business as the head of artists and repertoire at major record companies. I was a general manager for an independent record company. I currently manage artists and producers. I've had the good fortune to sign some great artists, people like Jann Arden, Sam Roberts, and Hedley. l'm actually even married to an artist, so I know very much how music can change a life and in some cases even save a life. Now in my new role at MusiCounts, I find myself in the incredibly rewarding position of actually seeding talent by putting instruments in the hands of kids who need it most.
There's a direct line from music education to inspiration, to motivation, to choosing a career in music, to writing, composing, and recording, to achieving success and celebration, be it at the Juno Awards or international acclaim. It's a continuum of musical dedication, creation, and celebration.
I truly believe that an investment in music is an investment in the future of Canada.
Thank you very much.
Good morning, everybody and committee members.
My name is Brett Kissel. I feel very privileged to be speaking and sharing my insight on the state of the Canadian music industry with all of you. As you begin your review on the vibrant music community we have in this country, I would like to offer some suggestions, ideas, concerns, and basic comments, hopefully to enhance what we have to offer our artists and our industry members in general.
Perhaps we should also discuss the state of the Canadian hockey association and how right now there's only one hockey team making the playoffs. We can talk about that a little bit later.
The future of Canadian music is in the hands of our up-and-coming Canadian artists and present-day stars. But let me also be realistic and complimentary, that the future of our industry lies in the hands of our government.
Before I begin with the task at hand, I want to give you a brief history on my career, my journey, and my upbringing in the music community. l am 23 years old and am a very proud Canadian. l'm a fifth generation Albertan whose great-great-grandparents emigrated from Ukraine over a century ago in search of a better life here in Canada.
At the age of six, I got my very first guitar. Fast forward half a dozen years, and I was playing locally around every small town, rodeo, and festival in our hometown of St. Paul, Alberta. There wasn't a stage too big or too small for me, as I cut my teeth not only as a singer and a guitar picker but most of all as an entertainer. By the time I was 16, I was nominated for the Canadian Country Music Association's rising star award, becoming the youngest-ever nominee in the history of that association. As I approach my 24th birthday, l'm the proud recipient of the 2014 Juno Award for breakthrough artist of the year. The Juno Awards were held in Winnipeg last weekend.
My rise in the Canadian music industry was not an easy journey. There were many ups and downs on this road. However, I was able to treat my career like any other start-up Canadian business. As an entrepreneur, I knew that I had to take some risks and do some performances for the exposure and not for the money because it would benefit my career in the long run.
l've always been a big picture guy, so naturally l've tried to look at becoming a big picture artist. This is where the role of the Canadian government has been so instrumental in my career personally, and in the career of my friends in the industry.
I still have some concerns. As hard as we try to create compelling music here in Canada, it's difficult to compete with American artists, because too often their quality is better than ours. Canadian radio stations are only forced to make up 35% of their playlists as Canadian content, so the spots that are saved for us, the true local artists, are few and far between. It's true that Americans automatically get more spins on radio in all formats over us Canadians. Hopefully, we can adjust that.
Those are some concerns I have, and I can speak on behalf of all artists in the industry that we all share these concerns, but there is a silver lining. Government programs such as FACTOR and other associations like the Radio Starmaker Fund are vital to our music industry. In fact, they're so necessary for the big picture, as I alluded to, that without them you wouldn't get me, Brett Kissel, Juno Award winner, hard-working rising star in the Canadian business. l'd still be the same hard-working entrepreneur, I feel, but I have an incredible advantage being able to access government funds through grant programs such as FACTOR. For those of you who don't know FACTOR, it stands for Foundation Assisting Canadian Talent on Recordings.
My album was funded by FACTOR. My first ever national tour which I just completed last month was funded by the Radio Starmaker Fund and FACTOR. This is true for some of, or truthfully most of, my buddies in the industry.
I am so thankful that I was able to access money to further enhance my career at a national level, and while I run the risk of sounding conceited, I know that the great success I've had recently would not have been the case without the great government funding.
As we like to say back home on the cattle ranch, l'm going to tell you a story straight from the horse's mouth. As you folks sit here discussing the allocation of funds for music programs, I'll give you an in-depth look as to where the money goes following a boardroom decision.
Once you sign-off or give the green light on x amount of dollars to be accessed by artists, managers, and record executives, we then apply for the grant.
Once we are conditionally accepted, I am then able to take that money and put it to good use by building my project or enhancing my project.
Once that album is complete, we send our music to radio.
Once radio picks up the single, it drives our live-touring business.
Once our live-touring business picks up, we sell merchandise, and once we sell tickets and merchandise, we can put that money back into our careers and the Canadian economy.
All while this is going on, another younger or different artist is going through the same process I just went through.
I had a song that went to number one last summer on country radio. It's called Started With a Song. But in reality, it doesn't all start with a song. I believe that it all starts in a boardroom, such as this one, with a capable committee that is willing to give music and arts a chance.
When an artist receives the grant. and it's not just about me, the artist, there's an incredible economic impact that is felt and spread to my five band members, my two crew members, and my manager, who has five children of his own. They all benefit; they all succeed, and we can all make some money.
I also know that some of them, like my band members or management company, have been able to tap into government funding. This has greatly benefited their careers and their music business. For you see, government funding is the kickstart to a very important process that has a great impact on the economy much beyond just me.
Everyone, and this statement includes everyone in this room, sitting on the sidelines and sitting around this table. I know you all love your music. You have your favourite artist. Music shapes moments in your life. This I can guarantee. So when you can help an artist get his or her music out to the public, whether that's through MusiCounts, or what have you, we can establish those unforgettable moments.
Canadian artists are very special. We're all very aware that some of music's biggest acts have come from here in Canada. Our ability to penetrate the international marketplace is as important as ever. We're all conscious that music is accessible worldwide through social media, iTunes and YouTube. We're no longer living in a box. There are no boundaries. That means our music needs to be competitive. International support only increases the profile for us, our Canadian acts, and helps our overall cultural identity.
After every concert I perform, whether it's performing for the Alberta flood aid at McMahon Stadium in Calgary in front of 40,000-plus people, or in a small theatre in rural Quebec in front of 200 loyal music fans, I use this method and these three words to improve my concerts and my performances. Those words are “start, stop, and keep”. What am I going to start doing? What am I going to keep doing? What am I going to stop doing?
As I look at this committee today I encourage all of you to start a discussion with more artists like me. Start collecting their opinions on the state of the industry the way you're asking me for mine. Start to understand that Canada has a great opportunity to showcase some of the best talent the world will ever see. We did it with Shania Twain, Anne Murray, and Leonard Cohen, to name a few. Start the preparation. Yes, get prepared, because Canadian artists have a lot to offer the world. We all need a strong starting point, and that's where the initial funding can make that happen.
Stop. Stop looking at the music industry with blinders on. Stop thinking that all of us musicians are just creators, because we're all business people and we may be some of Canada's greatest entrepreneurs.
Keep. Keep up with the great work in developing young artists. Keep working towards building the future of our industry. You've given so many artists a chance to succeed. I've greatly benefited from some incredible government programs. So keep that up and know how grateful we are for the unparalleled support. I'll tell you that my friends down south in Nashville are very jealous of the great opportunities I'm fortunate enough to receive.
In closing, I want to thank you for taking the time to listen to me. I'm thankful for the opportunity to have your ear and to share my ideas and my story with all of you today.
For those of you who are interested in following the progress of my career, I encourage you to spend some time on social media as we get to know each other.
We hope that you can continue to do the great work that you're doing. Just do more of it.
Thank you for being here. Thank you for what you do and for the contribution you all make.
I want to add my congratulations to you, Brett, on your achievement. Of course, you couldn't do it without support from people such as Mr. O'Reilly and Mr. Reid.
I've been very interested in what a number of witnesses have said respecting the need for education. In fact, next week I'm meeting with two groups in my riding in London who are very involved in this. These are charitable organizations. Well, one is St. Paul's Anglican Church; they do remarkable charitable work in all of our community. The other is the Aeolian Hall.
The Aeolian Hall is this incredible old music hall. I'm sure you know it. You know Clark and the incredible people who have made the hall come alive by supporting Canadian artists and upcoming artists. They are doing an educational program for kids in the poorest neighbourhoods in my community, and I can tell you, there are some incredibly poor neighbourhoods.
Like St. Paul's, they are bringing in these kids after school. They're providing instruments, and they're finding that not only are they giving these kids something positive after school—another outlet for whatever else is going on in their lives—but they are able to do some real community building with these kids. It's not just the musical skill, although that's absolutely key, but these kids go on to have a lifelong appreciation for music, the kind of appreciation that's going to feed that next generation of the incredible talent we have here. It also helps them to communicate respectfully and positively. It just gives them a whole new outlet.
While I'm very grateful that there is this willingness to go and get the private funding, it seems to me that what you're saying about a role for the federal government in this is very real.
, I know there needs to be broad consultation, perhaps with groups such as Brio Music and St. Paul's, but what should we be doing in terms of the federal government? I don't want them to get off with saying that this is the purview of the province. I want them to understand how important it is to be a part of those communities. We're not separated from our communities in the way we seem to pretend we are, up here in Ottawa. We have to be very much a part of this.
I want you to comment on this and tell me your experience and what you think.
Music is a community builder. Actually, there is a program I should make you aware of that you need to tell both those organizations about.
Through MusiCounts we've always been focused on the classroom primarily, but last year we started a brand new program with TD Bank, which is all about creating opportunities for after school programs. It's called the MusiCounts TD community music grants program.
It's open right now. We'll actually give grants of up to $25,000 to organizations that want to create a transformational opportunity in their community through music. We provide musical instruments and equipment. We don't provide the space or the teachers to do it. They need to make that commitment. That's an aside for you. Make sure they apply. May 9 is the deadline.
Music is an incredible community builder beyond the classroom within the communities themselves.
In Winnipeg during the Juno Awards we had two grant recipients there through the TD program, one of which runs an organization called Status4. He's actually a friend of , who used to work with her. His name is Kevin Gibson, and he actually works with the Winnipeg Police Service.
A few years ago he was on the beat and he noticed that he was picking up a lot of the kids over and over again for petty crime and drugs and things like that. He thought that pulling them into the station wasn't helping. So he thought he needed to create an opportunity for these kids and to find a place for them to go where they would feel comfortable and safe and, more importantly, engaged.
He contacted city hall. He found what was virtually a derelict building, a little community centre which he took over. With his own carpentry skills and his own hard work, he created a very small program called Status4 Inc. He encouraged neighbourhood kids to come check it out. It was music, and he had some guitars there. Over the course of a couple of years, he's built that up. He applied for one of our grants. We gave him a $25,000 grant with which he purchased, I think, 20 guitars, keyboards, a drum kit, bass amps, you name it.
He currently has 85 kids in that program. It's about to double to about 160 in his community. The crime rate in that area has dropped significantly. He attributes that very much to the fact that he has given these kids an outlet to go to. I don't want to say that all young kids are criminals either, by any stretch, but it does provide an opportunity.
A lot of studies show that it's between 3:00 p.m. and 6:00 p.m. that kids get into trouble. This opportunity gives these kids a place to go. This new program is funding organizations like that right across the country. It's very different from the classroom work we do through Band Aid. To see what these people are doing in their communities is amazing. They are saints.
We're the conduit to bringing money into a program and giving it to these people, but when I say these people are saving lives, truly they absolutely are.
And honestly, it makes better young Canadians.
We are teaching these kids teamwork and discipline and self-esteem, and they walk out of there....
We do these Band Aid celebrations at schools where we actually go in and we'll present a school with a $5,000 or $10,000 grant. Actually, Brett is going to participate in one on May 6 in a school in Bowmanville with us. We're going to deliver 10,000 dollars' worth of instruments to a school there.
It's hard to express unless you've been in the room at one of these, but giving a kid a new instrument and what that does for them is unbelievable. I spent 25 years in the music business as a talent scout signing artists, and I was somewhat jaded. I walked into a school in Halifax with an artist named Joel Plaskett, and we presented these instruments to the school. This one young girl came up to me afterwards and she said, "Mr. Reid, you have no idea what this saxophone has done for me."
It was kind of that classic Glee moment, because these kids were the losers of the school. It was very much an athletic school. We were supposed to have the celebration in the school gymnasium and we were moved to the cafetorium because the basketball team was having a practice. We got bumped in, and it was just the band students, and we had Joel Plaskett with us, who is also a Juno Award winner and well-known east coast artist, and we presented these kids their instruments, and they were like, "Today we're the rock stars of this school. You brought this artist here. You validated our music program. You've told people that we're important."
The other students weren't actually allowed to get into this ceremony. So the band class actually said that whoever raised the biggest amount of food for the local food bank could join the celebration. The school ended up raising—I can't remember how much—thousands of pounds of food for a local food bank, and all that was just through one central piece, which was music.
Thank you, Mr. Chair, and members of the committee.
My name is Ian MacKay, and I am the president of Re:Sound Music Licensing Company.
Re:Sound is a not-for-profit organization dedicated to obtaining fair compensation for artists and record companies for their performance and communication rights. We represent the royalty rights of more than 12,000 musicians, including featured and session musicians, as well as record companies when recorded music is played on commercial radio, satellite radio, pay audio, music streaming services, and in other businesses that use music. The money we collect is split fifty-fifty between the performers and the record labels.
Re:Sound's member organizations are Artisti, who are here with us today, ACTRA RACS, the Musicians Rights Organization of Canada, MROC, the Quebec Collective Society for the Rights of Makers of Sound and Video Recordings, SOPROQ, and Connect Music Licensing, who has already appeared before this committee.
The committee has already heard from a number of witnesses about the challenges facing the music industry and how that industry is changing. There's no question that recorded music is being consumed in more ways than ever before, with some sources of revenue declining, like CD sales, while others have some growth on the digital side.
The distinction between what is core music consumption and what is secondary music consumption is not as clear as it once was. Today a significant part of the income received by musicians and record companies comes from royalties for uses of recorded music on broadcast radio, satellite radio, pay audio, and increasingly, from music streaming services. Re:Sound licenses these uses on behalf of performers and record companies through rates that are certified by the Copyright Board of Canada.
As Stuart Johnston, the president of the Canadian Independent Music Association, said when he appeared before the committee a couple of weeks ago, the industry has splintered in terms of revenue sources and what was a dollar business has become a pennies business. At Re:Sound our focus is on getting fair rates for creators of recorded music, collecting all those pennies, and getting them to the rights holders, doing our part to ensure a healthy musical ecosystem.
There are two main recommendations Re:Sound would like to make to the committee today that we believe will be important in ensuring that Canada continues to have a strong recorded music industry going forward.
The first one is the elimination of the $1.25 million exemption for commercial radio. The second is ensuring that the regulatory process here in Canada is well placed to encourage a thriving musical economy and efficient digital marketplace. I will now speak to each of those in a bit more detail.
First is the elimination of the $1.25 million exemption.
In 1997, the Copyright Act was amended to grant performers and makers of sound recordings the right to receive fair compensation for the public performance and communication of their works. This amendment brought Canada in sync with 85 other countries around the world. Previous to this, only composers and music publishers, represented by SOCAN, had received royalties from radio play, while the people who performed and created the recordings had not.
The right was meant to parallel the existing composer-publisher right as it does in other countries, but it was substantially restricted at the time by a provision that commercial radio stations were only required to pay $100 on the first $1.25 million in advertising revenues. This was and remains the only such subsidy in the Copyright Act and the only subsidy of its kind in the entire world.
The rate-setting body, the Copyright Board, weighed in on this subsidy as far back as 2005, stating, “Even the smallest of stations would be able to pay the tariff,” and further, “allowing large, profitable broadcasters to escape payment of the full tariff on any part of their revenues constitutes at best a thinly veiled subsidy and is seemingly based on no financial or economic rationale.”
This subsidy removes about a third of the royalties performers and makers would otherwise receive from commercial radio. It reduces those royalties by about $8 million per year. The bulk of this subsidy goes to a handful of large radio groups. Removing this subsidy would cost nothing to government, but would mean that commercial radio would pay the proper royalty set by the Copyright Board for the use of recorded music, rather than the substantially subsidized rate they currently pay.
My second recommendation, as I said, is regarding the regulatory process for music. I quoted the Copyright Board just now, and you've already heard from a number of previous witnesses about the crucial role the Copyright Board plays. The Copyright Board is the tribunal that sets the rates to be paid by businesses that use music, including commercial radio, satellite radio and streaming services, and webcasters.
The concern is that with rapidly changing business models in the music industry and increasing demands on a Copyright Board with limited resources, as currently formulated the regulatory process can be perceived as a barrier rather than as a facilitator.
The committee heard from diverse witnesses in the last few weeks including Jodie Ferneyhough, the president of the Canadian Music Publishers Association; David Murphy, the president of the Professional Music Publishers Association; Gilles Daigle, the general counsel of SOCAN; and Victoria Shepherd, the executive director of Connect Music Licensing; that there is a need for a faster regulatory process, particularly in the emerging digital marketplace. This is also highlighted in Music Canada's report from last year, entitled “The Next Big Bang: A New Direction for Music in Canada”.
Victoria Shepherd quoted the statistic that 21% of total industry revenue in the U.S. comes from streaming, while in Canada it is only 7%. Vanessa Thomas, the managing director of the streaming service Songza, who appeared a week or two ago, said that part of the explanation for this gap could be because music services are not launching in Canada because they are still waiting for some of the rates to be set by the Copyright Board.
These businesses need to know what they have to pay for music, and the rights holders, the performers, and the record companies need to know what they will earn. Parliament needs to ensure that the Copyright Board is adequately resourced so that the regulatory process facilitates a thriving digital music business that encourages innovation of new models of distribution for music, which will then take the place of what we know is the big problem with services that provide music and nobody gets paid for.
Thank you for your time today. I would be pleased to answer any questions that the committee has.
Good morning everyone. My name is Sébastien Nasra.
First of all, allow me to thank you for the privilege of speaking as part of this exercise, the pertinence of which I salute as it comes at a key time in the evolution of the Canadian music industry.
My presentation will be in what can be referred to as Frenglish, so please keep your headset on and listen to the music.
It's been said of me that I am an industry international man of all trades. Classically trained as a percussionist from the Conservatoire de musique du Québec, I am the proud recipient of both a CEGEP diploma in administration and a law degree from Laval University.
In 1994, at the age of 23, I founded Avalanche Productions and Avalanche Sound Publishing. Avalanche went on to become an established 360 operation of artist services—management, publishing, label, album and show productions—and a significant player in the Canadian music industry launching the local, national, and sometimes international careers of acts such as The Soul Attorneys, Jorane, Les Respectables, Beast, Elisapie Isaac, and more.
Furthermore, my continuous determination to break borders has led me to build bridges with the rest of the world and create, in 2006, M for Montreal, a showcase conference and export platform now internationally renowned and locally celebrated, going into its ninth year of existence. M is a springboard into international markets that has contributed to the careers of many acclaimed acts, such as Half Moon Run, Patrick Watson, DJ Champion, Coeur de Pirate, Karkwa, Suuns, P.S. I Love You, and many more.
In 2011, along with seasoned Toronto-based programmer Derek Andrews, we launched Mundial Montréal, serving and supporting the Canadian world music community through a yearly showcase conference and by currently creating an unprecedented network of presenters with a clear goal: developing opportunities for talents emerging from the richness of the Canadian cultural diversity.
In only three years, Mundial has become internationally recognized as the premier professional meeting place in North America for global music. Other involvements in different aspects of the industry include serving on theboard of directors of organizations such as SOCAN. I was a founding member of APEM, Association des Professionnels de l'Édition Musicale, and I am currently serving on the board of ADISQ. But enough about me.
I would like to draw your attention to some of the needs of Canadian music and to future possibilities. First of all, I must challenge some commonly held misconceptions.
While it is true that anyone can do a recording in his living room and put it on YouTube, the fact remains that the cost of equipping oneself with the means to produce a quality product and to have consistent visibility are increasingly high.
How do we deal with the challenge of the digital era, social media, and the broader role of corporations? We believe that there are some key solutions: workers, workers, workers. Companies must have help hiring and attracting specialized workers, mainly in viral marketing and social media advertising.
It's all about social networking, right? For that, it takes bodies, young potential music industry professionals for the future that will give young organizations the ability to grow their support staff more efficiently and more effectively.
One has to remember that when the fund was set, the instant social media needs did not exist at all, and it is in no way replacing the traditional media or marketing needs, but it is actually in addition to the existing needs of skills and clout to be able to compete in the new marketplace.
The market hasn't changed much. People still want music and need to access music more than ever. It's the way of bringing it to their attention and getting it in their ears that has evolved with technology, and the faster pace with which it's delivered.
I have some recommendations. This might sound funny, but we need more geeks. It's the revenge of the nerds. We need funds dedicated to keep up with the need for fast, constant social media and network maintenance, online marketing plans, conversations with the public, creation of quality online content, innovation in practices, and evolution in e-market penetration methods.
A little earlier, we talked about developing a young audience. Firstly and secondly, we must educate young people and put them in contact with music which, as evidence has shown, has beneficial effects on cognitive development and motivation. We must also capture their imagination before they are taken over by video games, movies and TV.
Let's talk about marketing and commercialization. Production is relatively well-supported, but it has become increasingly difficult and costly to sell a product. It is important to maintain support for creation and production, because without a good quality product, no one will buy it even with all the marketing in the world.
The priority is touring, touring and touring. At the end of the day, that is the best type of local, national and international promotion. It has been clearly proven that artists who tour can do nothing but develop artistically, develop their audiences and develop demand for their projects while generating various types of spinoffs, including jobs for technical staff and others.
In terms of research for new opportunities for music, there is a cruel lack of support for developing new initiatives. I am talking about support for business plans and market studies to facilitate the presentation of music on various non-traditional platforms, like movies, TV, video games, multimedia, and advertising, to name a few.
I want to talk about diversity in diverse cities. The Canadian cultural mosaic is larger, bigger, and more diverse than ever. It is not only French and English anymore. It is starting to express itself as the new Canada.
Recognizing the organizations and events that represent, support, and bring to the masses the sounds and cultures of a wide variety of global beats and voices of the world that have adopted Canada as their home is an essential step moving forward in supporting our incredibly diverse communities that form the social fabric of Canada 3.0.
In listening to other voices who have opinions in this area, we noticed that, namely, the Government of Ontario and heavy hitters of the Canadian music industry based in Ontario are being strategically aggressive with even more Toronto-centricity and establishing Toronto as the most significant music hub in the country.
While we understand their motivations, we would like to think that the magic of the Canadian music scene is about more than one place. Examples like the National Music Center in Calgary, initiatives like BreakOut West, the ECMA awards, Les Francouvertes, or M for Montreal, to name a few, all contribute in their own way to make Canada so special, unique, and diverse. Again, the D word, diversity.
As for exports, I would like to clarify that some industry stakeholders would like to see a single model and a single window for dealing with and organizing export missions. We do not believe that such a model promotes diversity, nor is it the best approach for tangible individual results for artists.
Why? Because each project has different artistic content, different timing, different needs and different strategic approaches. The tools available to artists and Canadian entrepreneurs must remain flexible, diversified, and strategic so they can respond quickly to the rare opportunities that arise in an increasingly competitive international market.
The department did consult industry on this specific point in the fall of 2012, and the exercise clearly showed that the diversity of stakeholders and the diversity of business models is the way to go.
Finally, we want to underscore the difference between flourishing in Canada and developing the artistic careers of Canadians, in terms of market development, of course.
Because, at the end of the day, it's all about the music, man.
Thank you for your attention. I would be happy to answer any questions.
Thank you, Mr. Chairman.
Good afternoon, committee members.
First of all, I would just like to thank you for inviting us to give our opinion on the effects of technological change on the creation, distribution and consumption of Canadian music.
The UDA, represented today by Richard Petit, one of its directors, is a professional association representing around 12,000 performers, including singers.
Artisti is the copyright collective created by the UDA in 1997. We have over 3,100 members, singers and musicians of all languages. To date, we have distributed to them over $25 million in royalties under the system of equitable copyright remuneration.
Let's come back to the effects of technological change. The effects are many, and we have recommendations to make on steps to take to offset the negative ones.
Don't forget, it is easier than ever before to copy and listen to music. Accessing it is child's play. Just think of iTunes, the various streaming sites or even YouTube, which provide access to a huge catalogue of music. However, there is not always a fee for that access, and the income that should in principle make its way back to the musical performers does not always materialize.
Take YouTube, for example. Almost everyone listens to music online on YouTube. To listen to music accompanying videos or still images on this site, the audience pays nothing. As for the performers whose musical performances are accessible in this manner, they often do not receive anything either.
We believe that if anyone receives any income in connection with such use, a portion of that income should go back to the performers, as is the case with the equitable remuneration system under sections 19 and following of the Copyright Act. That system provides for a 50/50 sharing of royalties between the makers of sound recordings and the performers.
To do this, changes would have to be made to the Copyright Act such that the equitable remuneration system would capture the free dissemination of videos involving music.
As for other Internet broadcasts, there are two types. On the one hand, there is radio show simulcasting, and on the other, there is non-interactive and semi-interactive streaming, such as Songza. This is similar to conventional radio.
For these broadcasts, the performers and makers of sound recordings are waiting for the Copyright Board of Canada to set an equitable remuneration tariff soon. These broadcasts will ultimately be subject to equitable remuneration, with a 50/50 split between makers and performers, which is a good thing, in our view.