Canadian CD-R Tariff Proposal Explained

Kushana writes: "In this story Slashdot reported on an application by the Canadian Private Copying Collective (CPCC)to increase the tariffs on recordable media (including CD-Rs, DVD-Rs, and cassette tapes) in Canada for 2003-2004. That announcement by the Copyright Board of Canada outlined the new tariffs but did not provide any justification. The Copyright Board has now published a CPCC document (Adobe Acrobat Reader required) that outlines the CPCC's rationale for their proposed increases and new media to be covered." Read below for more details.

"The actual basis of these tariffs is a complex formula that involves (among other things) the percentage of the media sold to consumers, the fee payable to the copyright holders from an average pressed music CD, and the percentage of CD-Rs that end up as coasters. The formula can be found in the document that describes the tariffs for Private Copying 2001-2002 (Adobe Acrobat Reader required).

In the case of CD-Rs, the proposed increase from $0.21/CD-R to $0.59/CD-R is due to an increase in the percentage of CD-Rs bought by consumers (45% to 70% since late 2000), an increase in the percentage of CD-Rs used to copy music (56% to 62% in the same time period), and the advent of 80min CD-Rs that can hold more music. However, there is one more factor.

There is currently a "secondary value" discount on the levy to reflect the fact that copies are worth less than the originals. In the 2001-2002 decision the Board applied a 37.5% discount to that effect. The CPCC now claims that because so few copies are of the whole album (10% by their numbers) the discount should only apply to those."

Comments

Canadian progress

[sllort]

So now in Canada, I have to pay Britney Spears to record music I play on my own guitar. That's pretty cool if you're an idiot. Or Britney Spears. But I repeat myse..

Re:Canadian progress

[Anonymous Coward]

Or Canadian. But I repeat you.

Please tell me

[billcopc]

As a fellow Canadian, I would love to know out of whose ass they pulled those numbers. 60% of cd-r used for music ? bull$hit. There isn't that much music worth burning anyway!

Re:Please tell me

[Herr_Nightingale]

The percentage of music CD's out of the total that I burn is less than 5%. There's a valid stat, though they'll never quote me.
Out of those CD's burned in my household, the vast majority are backups of hard drives, a couple backup mp3 CD's (I tend to scratch my original CD collection, many are now unplayable but easy to recover) and the other four percent are undeniably "pirated" material. Heck, I had a collection of over 800 bought CD's, I've found hardly anything through peer-to-peer that I didn't already have.
I think the Canadian gov't could learn a thing or two about common sense from the Dutch Kazaa ruling.

Re:Please tell me

[gotr00t]

Yes, I agree, that is absolute nonsense. I think that this entire tariff being so high is simply absurd! If they increase the price to a number that costly, it would overshadow the actual price of the CD-R. I think that their logic is clearly flawed in this context in order to create a tariff of such laughable proportions.

Let's Evaluate

[erasmus_]

Let me see if I got this right. The top reasons for raising the tariff from $0.21 to $0.59 per CDR are:

1) Increase in number of users who are purchasing CDRs and using them to copy music.
Ok, and why does this justify raising prices? Since the tariff applies to all CDRs, this means that more people are already paying, and they should be making proportionately more tariff money. How does one justify raising the cost of the product when more people are buying said product?

2) 80 min CDRs are now more popular
Let's see, because of the miniscule rise in the fraction of storage now available, they want to increase the price 2.8 times. Again, I haven't seen this magic formula, but that additional 50MB must sure weigh in heavily.

3) 37.5% discount should not apply because few are copying whole album.
Right, so copies should now be worth even less, as most of them are incomplete. To me, this is an argument for raising the discount instead of lowering it. How do you raise the price for something you're now arguing went down in value?

This whole thing is so screwy.

Re:Let's Evaluate

[Sentry21]

1) Increase in number of users who are purchasing CDRs and using them to copy music.
Ok, and why does this justify raising prices? Since the tariff applies to all CDRs, this means that more people are already paying, and they should be making proportionately more tariff money. How does one justify raising the cost of the product when more people are buying said product?

The logic is that instead of 45% of the CDs being bought by home users, 70% now are, and only 30% are for non-home use (i.e. data backups at work, etc.). It's not more in numbers, it's more percentage of the numbers.

As for the rest, the increase in 6 minutes of audio will allow between one and two average-length songs to fit on one CD (instead of ending up with 71 minutes and two 4 1/2 minute songs, you can fill the CD).

The last one makes no sense though. Perhaps it's the logic that people aren't buying CDs for whole albums, and therefore they shouldn't be discounted for making crappy copies of whole albums. Who knows.

--Dan

Taxation Without Representation

[jo42]

And what about the independent artists that use CD-R media to release their work? Now they have to support commercial artists - which don't support them back in turn. My, my this truly sucks, don't it, eh?

Re:Taxation Without Representation

[Dyolf Knip]

And what about the independent artists that use CD-R media to release their work?

Now how wacked is this? 230 years ago the proto-US was pissed because they had no say in how they were paying taxes. Today indy Canadian artists are pissed because they have no say in how they receive the money from taxes. Both extremes of insanity on the same continent! I love it!

Re:Taxation Without Representation

[Anonymous Coward]

Independent artists are repersented by the RIAA, just not directly.

Re:Taxation Without Representation

[Dyolf Knip]

Independent artists are repersented by the RIAA, just not directly.

Oh? So any bonus money that the RIAA gets from tariffs or taxes or whatever gets split up fairly among the giants and the non-RIAA artists and publishers? If you believe that, I have this bridge I could sell to you.

you're not that far away...

[kootch]

do what we did in college. take an SUV and a blanket. drive across the border. Load up on spindles of CDR's and such, put the blanket overtop of em, drive back.

We did the same thing 'cept in reverse in getting Molson XXX across from Montreal.

Re:you're not that far away...

[mrscott]

Unfortunately, security is much tighter at the border these days. More cars are checked than before and they don't generally let stuff get by as much as they used to. If they find it, they'll confiscate it. Hopefully they won't shoot you on the spot for attempting to subvert their "revenue" stream. (kidding, of course) RANT: Why is jacking the public called "increasing revenue"? Eh. Scott

Re:you're not that far away...

[Anonymous Coward]

If they find it, they'll confiscate it.

They won't confiscate stuff like alcohol or CDs, they'll just charge you duty. When coming back to Canada from the U.S., most border guards will let you get away with 12/24 cans of beer (some will still make you pay duty, especially if you don't look honest), and I think each person is allowed something like $50 of other items.

If you stay in the U.S. for a certain amount of time (48 hours, IIRC), you're allowed to bring more stuff back (maybe a few hundred dollars). If you drive down there with a few friends and stay for two nights, you'll be able to bring back a lot of CDs legally (as well as some alcohol and tobacco).

Re:you're not that far away...

[Sentry21]

While I realize this is an anecdote, you're actually right on the money.

The tariff only applies to CD-R/RW discs, Audio CD-Rs, iPods, etc. that are imported for resale.

It is entirely legal for you to import your own whatever in order to avoid paying the taxes; however, you cannot legally re-sell them without paying the tariff. Customs cannot and will not charge the tariff if you drive an SUV full of CDs, iPods, and flash cards across the border, if it's all for your own use. They may charge you GST on it (this is what makes hiding it illegal), but you won't have to pay the tariffs.

--Dan

Re:you're not that far away...

[Anonymous Coward]

Entirely accurate - the customs people will NOT add a levy at the border. I asked them when I brought some blank media across a few months ago, and they rather curtly replied:

"We don't collect levies"

So there you go. The cross-border business should surge. Canadian retailers should be up in arms too - why would anyone spend their money on this side of the border and get levied when you can get a much better deal a few minutes across the border.

Especially handy for those of us that are a short car trip away from great deals.

Since you are paying for it, is it legal now?

[Faldgan]

I don't know about everyone else, but I don't particularly mind paying (even paying the record companies!) to listen to music. What I do mind is the amount I have to pay for music I don't want. I like a few songs by dozens of bands, but they want me to pay for the full album. Not a chance. If I can pay my $21per Gb to be legal on my MP3 player, and I can play ANY music I want, and change music as I wish, I'll pay it. Gladly. But if you want to charge me, make me pay for the music, and then still call me a criminal, then f*ck you.

Re:Since you are paying for it, is it legal now?

[cicadia]

Are you Canadian? Great. It's legal. You can legally make copies of recorded music for your own personal use. You won't be called a criminal for that.

Re:Since you are paying for it, is it legal now?

[Anonymous Coward]

You won't be called a criminal for that.

Legally, you won't be considered a criminal, but you'll still be called a criminal ("thief" or "pirate") by the recording industry, and by people who don't understand it's legal (a lot of people on /. don't understand this).

Re:Since you are paying for it, is it legal now?

[plcurechax]

You can legally make copies of recorded music for your own personal use. You won't be called a
criminal for that.

Yes you can copy audio legally for your own pesonal use, part VIII of the Copyright Act.

But the greedy media mogals will still call you a criminal though.

I heard 44% somewhere...

[andaru]

with a slim majority used by corporate IT.

Tapes in the U.S.

[andaru]

They already do this in the U.S. with analog audio tapes (possibly video tapes and some other media, too).

If you buy audio tapes to record music in your 4-track then you still have to pay a tax to the recording industry.

We should have the right to pirate to any media which is taxed for piracy. We already paid.

They could have some CD-Rs made expressly for pirating music, and only tax those. :)

Some number

[Anonymous Coward]

(sorry for AC I not at home)

From the doc "DECISION OF THE BOARD":

0.95$ CND by CD for Authors
1.90$ CND by CD for Performers + Makers

So a 20.0$ CD and only 2.85$ go to the artist. And today on the news (Quebec, big lunch of Celine Dion album) they blame music pirate and Net for possible low sale without giving a Fck number. I so tired of this type of manipulation by the Label. I don't have buy a album for one year (if they come form a RIAA member) and I don't stop! Wake artist, you have a new powerful tool to distribut your music, use it.

Drix

nothing new

[mystran]

The funniest thing, in Finland (at least used to be so that) you have to pay a copyright office (called Teosto) a fee for each casette and CD-R. The amout of the fee depends on the content. Now, if I sell a blank cd with "Audio CDR" printed on it, i must be Teosto double the fee that I would pay for "Data CDR".

Wonder why empty "Audio" CDRs are not available in most stores..

Complaints go to

[cramhead]

I less then pleased with this tax. Especially, as I don't copy any music onto CD. I figure things will just stay the same if we don't change it. Complaints go to:
CLAUDE MAJEAU
Secretary General
56 Sparks Street, Suite 800
Ottawa, Ontario
K1A 0C9
(613) 952-8621 (Telephone)
(613) 952-8630 (Facsimile)
majeau.claude@cb-cda.gc.ca (Electronic mail)

Note:
Objections must also state if the objector intends to participate in the pre-hearing conference to be held on Thursday, May 23, 2002 at 10:00 a.m., the object of which is set out below.
Where possible, the Board asks that all comments and objections be sent by electronic mail.

Great . . .

[uberjon]

Now If I just want to backup data on my hard-drive I have to pay pretty much double what im paying now for a CD-R. Maybe I should start taxing the record companies for making me listen to bad music on the radio!

No home data use?

[coyote-san]

So it's no longer "data" vs "audio," but "home" vs "work?"

I admit it, this really pisses me off because it's clearly an effort to manipulate perception and partition the market in ways more favorable to the RIAA. They'll leave offices alone, for now, if they can get the legal presumption that all home users are pirates.

But in fact many people work from home - for many service-based small businesses there is no "office" - and for most people the CDR is the only backup medium they have. Even those of us with real tape drives (I have both TR-4 and DDS tapes) often use CDR backups because of the fast recovery rates. (With a indexed compressed tar system I'm working on, I can do wildcard recoveries from a full 800MB CDR in a matter of seconds.)

But according to the RIAA, I use those 50-disc spindles to rip insufferable pop music, not to backup up my own business files.