Canadian Publishers Hit High-tech Trail

While record labels and music artists worldwide argue about the best way of using technology to deliver music, Canadian music publishers are finding that advances in technology are creating greater opportunities for their music to reach a broader audience.

"We are at quite a complicated point in the evolution of the industry," BMG Music Publishing Canada GM Robert Ott says. "The paradigm has probably shifted as much as it shifted from sheet music to recorded music. Publishers have had a chance to embrace new opportunities, perhaps before the rest of the music industry."

Sony/ATV Music Publishing Canada creative director Gary Furniss agrees. "All publishers are now trying to expand on their businesses [in] any way they can. Publishers are flexible and are faster than record labels. We can more quickly adapt and source out new ways to create revenue."

Noting that high-speed Internet penetration in Canada is among the highest in the world, Andre LeBel, CEO of Canadian performing-rights organization the Society of Composers, Authors and Music Publishers of Canada, says music publishers have been more aware of digital issues than labels.

LeBel says, "A lot has been written about the record labels in the past year, because their sales have plummeted due to the technology and the 'free music' available from downloading. But creators had been struggling with such issues before the record companies started feeling the pain."

Ott argues that new technology on the Internet is opening up further avenues of revenue for publishers. "What that high-bandwidth strata is gasping for is content," he says. "If we don't supply the content, people will find it elsewhere."

LeBel cautions, "Joe Public doesn't yet understand that behind every CD sold, every piece of music he hears on the radio, television, or in the cinema, there are music creators and their publishers that need to be separately remunerated from the record companies, distributors, and artists."

In February, Ott completed an agreement with Samsung Electronics Canada to pre-load three music tracks onto the company's personal MP3 players being sold in Canada. "This is a way of generating income, and Samsung has set an example in paying for the files on an MP3."

RING TONES CALL FOR REVENUE

Ring tones on cellular phones—already generating significant revenue for music publishers in Japan and Scandinavia—are another area where Canadian publishers are expecting to reap sizable dividends. The Canadian Musical Reproduction Rights Agency recently established terms and conditions for ring-tone licensing, and its publishers are now considering whether to allow the organization to license entire catalogs or license by individual song.

EMI Music Publishing Canada president Michael McCarty points out that several telecommunications firms, including U.K. mobile-phone company Vodafone, have introduced payment systems aimed at encouraging online service providers to sell such low-cost digital content as ring tones, MP3 files, and video content.

"I see the cell phone as the path to the successful commercialization of buying music in a software form," McCarty says. "[Ring tones are] an opening of a very large door. It's not a big leap for consumers to next download an MP3 file."

Despite recent technological advances, the Canadian government's delay in enacting the two World Intellectual Property Organization treaties—the Performances and Phonogram Treaty and the Copyright Treaty—continues to leave the domestic industry weakened on the digital frontier. While the treaties were signed in 1997, they have yet to be ratified.

As a result, the government has yet to fully deal with copyright protection in the digital age. Following a year-long dialog with rights holders, however, it recently introduced a bill which, though narrow in scope, begins the process of protecting the rights of copyright owners whose work could be distributed by new technologies. If passed, it will establish a regulatory system that may allow new types of distribution systems, including the Internet, to be used to retransmit broadcast signals.

The bill is expected to be passed by year-end. But industry figures remain impatient about the slow pace of the government's digital agenda. "I'm dying for the day when every DJ in this country goes to a Friday-night dance with a laptop, signs on to a secure site, and legitimately downloads music that is licensed at source, [so that] my creators get paid," LeBel says.