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Music streamers want the Canadian government to kill the new requirement to pay into our music system. This is crazy. Here’s why.

The story so far: Bill C-11 requires all streamers with Canadian revenues of $25 million or more to contribute 5% to our creative industries. This is not a shocking thing, given that domestic radio and TV have been doing this for decades. Canadian radio and TV is also required by law to support domestic culture. It’s this kind of continuing support that has turned Canada into a musical powerhouse on the international scene. We create more global superstars than a country of our population should.

Legacy media (i.e. radio and TV) is suffering through an advertising and revenue crisis. Meanwhile, foreign streamers (everyone from Spotify and Apple Music to Amazon and Netflix) are draining hard currency out of the country without putting anything back into the system. Bill C-11 was designed to rectify that. The estimate is that this will mean a $200 million annual investment that will help creators of all stripes, including musicians.

And Canada is not alone. France has a similar law that demands 20-25% of revenues. Germany, Romania, Poland, Italy, Portugal, Croatia, Belgium, Switzerland, Greece, and Spain have passed similar measures although all haven’t been implemented yet.

In other words, streamers, if you want to operate within sovereign territories, you have to play by the rules and put money back into the system.

The streamers, however, are crying foul. They’re appealing to Heritage Minister Pascale St-Onge (a musician herself, by the way) to intervene and kill the measures. If not, costs could be passed on to consumers. I quote from Graham Davies, the president and CEO of the Digital Media Association:

“Canadian consumers clearly seek access to millions of songs at an affordable price. We are concerned that this new tax will exacerbate the current affordability crisis in Canada, in particular for younger Canadians who are the predominant users of audio streaming services.”

I’ve heard complaints from music consumers, too, concerned that they’ll have to pay more for their music. Perhaps. But consider this:

  • Spotify has a free tier. You can listen to all the music you want in exchange for listening to a few commercials every hour. (Then again, Spotify might thinking of charging a “modest fee” for its “free” tier.”)
  • Even subscriptions are cheap. In Canada, Spotify costs $10.99. That gives a subscriber instant access to more than 110 million songs for less than the price of one CD. You can argue that music is too cheap. Musicians certainly believe that.
  • 5% on $25 million is $1.25 million annually. That’s pocket change for any muisc streamer, especially Apple, Amazon, and Spotify.
  • Even if the streamers were to pass that 5% on to consumers, that amounts to six cent on that Spotify sub of $10.99. SIX CENTS!
  • And aren’t music fans complaining that streaming payouts are criminally low and are hurting musicians. If they really cared about the fate and well-being of musicians, then shouldn’t they welcome this help? Or does their support of Canadian music (or music in general) end when it impacts them to the tune of a few cents per month?

It’s nuts. What a bunch of crybabies.

Alan Cross

is an internationally known broadcaster, interviewer, writer, consultant, blogger and speaker. In his 40+ years in the music business, Alan has interviewed the biggest names in rock, from David Bowie and U2 to Pearl Jam and the Foo Fighters. He’s also known as a musicologist and documentarian through programs like The Ongoing History of New Music.

Alan Cross has 38542 posts and counting. See all posts by Alan Cross

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