Bill C-32 and Digital Locks: An Uneasy Balance

Lidiya Yermakova is a first year JD candidate at Osgoode Hall Law School and currently enrolled in the course Law & Social Change: Law & Music, in Winter 2011. As part of the course requirements, students are asked to write a blog on a topic of their choice.

The Copyright Modernization Act, otherwise known as Bill C-32, is a proposal put forth by the Canadian government to amend the current copyright laws.  I propose to analyze the TPM provisions of BillC-32 through the lens of the music industry.

The confused definition of “modernized” copyright is most apparent from the debates surrounding the Technology Protection Measures circumvention clauses of the Act, otherwise known as digital locks or TPMs, which bring users’, creators’, as well as other interested third-parties’ rights to what seems like an irreconcilable clash. This clash is perhaps most visible when viewed through the lens of the music industry, and it is through this medium that I propose to analyze the TPM provisions of the Copyright Modernization Act.

An Ottawa law professor and blogger, Michael Geist, who has commented extensively on Bill C-32, summarizes the creative industry’s perception of the Act in a recent post: it is “a house divided.” The Bill goes too far; the Bill does not go far enough. It seems that the only thing these two sides can agree on is the general sense of dissatisfaction, and the feeling that the proposed prohibitions against TPM circumvention – whether perceived as lax or trigger-happy – will inevitably inch the already teetering music industry that much closer to annihilation.

Section 41.1(1)(a) outright prohibits the circumvention of Technological Protection Measures, which includes the removal of any digital locks. This rule is subject to an open list of exceptions, which currently include purposes of national security, intercommunicability of computer programs, “encrypted research” and the like – in other words, exceptions with which the average consumer will likely never grapple. The practical application of this provision, from the user perspective, leads to an absurd conclusion: if you purchase a digitally locked product, for instance a song online, you only own the song as far as its medium of storage. If you purchased it onto your computer hard drive the song cannot migrate onto, say for instance, the hard drive of your iPod, or at best it can only migrate a set number of times. This law seems largely detached from reality, as it makes digital listenership, an overwhelmingly dominant form of modern music consumption, overly burdensome and expensive.

The flipside of this user-centered criticism is advanced by the creator-focused side. Canadian Cultural Industries’ recently released Joint Statement on Bill C-32 highlights the perceived shortcoming of Bill C-32, including the TPM circumvention provisions. Their key contention is that the creator has an inherent and overriding right to control their work, a right which Bill C-32 jeopardizes through its open list of exceptions. Canadian musician Carole Pope, in a recent Globe and Mail editorial, warns that trivializing industry earnings by relaxing modes of revenue generation will turn artists into “hobbyists,” actively shut down the industry and outsource music production abroad. The fact that C-32 allows the government to legislate in new exceptions dictating when circumventing a TPM is not an infringement means revenue-drying immunities can be introduced at any time. That, combined with the possibility of loopholes within the current exception scheme, may leave the music industry facing the same financial problems that it is facing today.

The Canadian Bar Association has recently submitted, in a statement concerning Bill C-32, that the goal of any new copyright legislation must be “to strike the appropriate balance of all parties’ rights.” The Copyright Modernization Act, as it currently stands, strikes that balance in a very roundabout way. Section 41.1(3) prohibits “default” statutory damages to be applied to non-commercial infringers. Rather, if copyright is infringed for personal purposes, the copyright owner must recover damages from the infringer directly. The costs associated with litigation, combined with comparatively low payout of a successful claim, would make private infringement virtually unpunishable. In sum, Bill C-32 broadly criminalizes digital lock circumvention, while making provisions to prosecute only a fractional number of those cases.

For copyright legislation to be effective, the balance struck must be real. In terms of music, copyright law must take into account all the variables, including the changing state of the industry’s distribution and revenue models, as well as the shifting expectations of both users and creators – a challenge that the legislature has delicately avoided in its approach to Technological Protection Measures within Bill C‑32.

  1. Respectfully, the author conflates anti-circumvention exceptions with copyright exceptions, and as a consequence actually misrepresents industry positions on the Bill. For instance, she claims that there is a consensus in the music industry that the TPM provisions “will inevitably inch the already teetering music industry that much closer to annihilation” (a tad hyperbolic), when actual sentiment from music industry stakeholders re TPMs appears to range from strong support (eg needed to support emerging distribution channels and to support future of the industry) to indifference (eg don’t feel DRM works for music industry). I’m certainly not aware of any music industry stakeholder who has criticized the TPM provisions in the stark terms presented.

    She also asserts that is a “digitally locked” product is purchased, it’s locked into the medium of storage. To the extent that the post is supposed to be concentrating on the music industry, this is a moot point as the overwhelming majority of digitally downloaded music is available DRM-free. Moreover, and more importantly, the assertion is simply not true. For instance, Spotify, iTunes, Netflix, Amazon’s Kindle and Steam are all forms of TPMs that permit users to transfer products between devices, and such new platforms and “cloud services” are increasingly becoming the predominant channel for delivering digital content.

    The author appears to link music industry complaints about the new copyright exceptions introduced by C-32 (including the failure to extend the private copying levy to devices) with the TPM provisions, suggesting that the music industry opposes the regulation making power for new anti-circumvention exceptions. Personally, I am not aware of any serious opposition to ensuring the Government has the authority to add new exceptions (although there is debate about the best process for this to occur, and whether such exceptions should apply to just the act of circumvention or extend to trafficking in circumvention devices and services).

    She states that C-32 criminalizes circumvention of TPMs, when this is not true. While the Bill creates potential civil liability for circumvention of access controls (but not copy controls) under certain circumstances, this activity is NOT criminalized. The criminal provisions only apply to trafficking in circumvention devices or services for commercial purposes, and would not apply under the circumstances described. Moreover, as the author mentions, the Bill also prohibits a rightsholder from recovering statutory damages against any individual who circumvents for their own private purposes, effectively immunizing such individuals from legal action.

    Lastly, the conclusion is decided unclear. What is the “challenge that the legislature has delicately avoided in its approach to Technological Protection Measures within Bill C‑32”?

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