Standing Senate Committee on Foreign Affairs and International Trade
 

THE STANDING SENATE COMMITTEE ON FOREIGN AFFAIRS AND INTERNATIONAL TRADE

EVIDENCE


OTTAWA, Thursday, February 1, 2018

The Standing Senate Committee on Foreign Affairs and International Trade met this day at 10:30 a.m. to study on the impact and utilization of Canadian culture and arts in Canadian foreign policy and diplomacy, and other related matters; and, in camera, for the consideration of a draft agenda.

Senator A. Raynell Andreychuk (Chair) in the chair.

[English]

The Chair: Honourable senators, the Standing Senate Committee on Foreign Affairs and International Trade is meeting this morning.

Under our mandate, the committee will hear today from Dr. Michael Geist, Canada Research Chair in Internet and E-commerce Law at the Faculty of Law at the University of Ottawa; and Ms. Christa Dickenson, President and CEO of Interactive Ontario and Chair of the Canadian Interactive Alliance.

Welcome to both of you. I’ll ask senators to introduce themselves so you know who is present today, starting on my right.

Senator Greene: Stephen Greene from Halifax.

Senator Oh: Victor Oh from Ontario.

Senator Neufeld: Richard Neufeld from British Columbia.

[Translation]

Senator Saint-Germain: Raymonde Saint-Germain from Quebec.

Senator Massicotte: Paul Massicotte from Quebec.

[English]

Senator Cordy: Jane Cordy from Nova Scotia.

Senator Bovey: Patricia Bovey from Manitoba.

The Chair: I’m Raynell Andreychuk from Saskatchewan.

Welcome to the committee. I think you’ve been advised that there is an opening statement that you can deliver, and we really do like questions. The floor is yours.

Michael A. Geist, Canada Research Chair in Internet and E-commerce Law, Faculty of Law, University of Ottawa, as an individual: Thank you very much, senator. Good morning, everyone. I’m Michael Geist, a law professor at the University of Ottawa, where I hold the Canada Research Chair in Internet and E-commerce Law. I’m also a member of the Centre for Law, Technology and Society. My areas of specialty include digital policy, intellectual property and privacy. I appear in a personal capacity representing only my own views.

I’ll begin my opening statement with a bit of myth-busting when it comes to the state of Canadian copyright and the cultural market. I think it is relevant since it has a direct impact on three areas linked to your study: External pressures to reform domestic laws, the prospect of using Canadian copyright laws to influence reforms in other countries — in a sense engaging in copyright diplomacy — and the interaction between Canadian copyright law and our sometimes contentious trade agreement negotiations.

First, Canadian copyright law in perspective.

I think it’s essential to state clearly and proudly that Canada meets its international commitments with respect to copyright. Indeed, we are viewed by many as a leader; a leader in offering strong protections for creators, a leader in striking a balance for fair access and innovation, and a leader in crafting innovative rules that are worthy of emulation by others.

Canada’s compliance with international standards can be found in every aspect of our law. We are a member in good standing with every major copyright treaty. We meet the international standard for terms of copyright protection, we offer creators protection for both economic and moral rights, and we have some of the toughest anti-piracy laws in the world.

Canada also increasingly sets the standard for progressive approaches to copyright. We have unique provisions to protect user-generated content and educational access to Internet materials, we seek to strike a fair balance on the rights of creators and users in addressing online infringement allegations, we have a flexible user rights framework that protects creator issues such as parody, satire and criticism, journalists’ interest in news reporting, and research and teaching interests in all levels of Canadian schools and education.

The impact of a balanced, progressive law compliant with international standards can be felt throughout the cultural sector.

For example, the days of worrying whether consumers would pay for music are largely over with the Canadian music market growing much faster than the world average, streaming revenues more than doubling in 2017, the Canadian digital share of revenues of 63 per cent exceeding the global average of 50 per cent and Canada leaping past Australia to become the sixth-largest music market in the world.

There are similar stories across virtually every cultural sector. Since the 2012 copyright reforms, music collective SOCAN's Internet streaming revenues have grown more than tenfold. In fact, they issued a report only yesterday that indicated that revenues grew again by a significant margin, reaching nearly $50 million annually. By comparison, in 2013 Internet streaming revenues were just over $3 million. The growth is dramatic. Movie theatre and overall broadcast revenues have also continued to increase since 2012 and the video game sector represents one of Canada’s greatest cultural success stories.

The success extends to the publishing and education markets. Notwithstanding what you might hear, since the 2012 copyright reforms there has not been a decline in the publication of new Canadian titles. Educational spending on licensing works from publishers and authors has increased as the sector shifts from buying physical books and paying for collective licences to licensing e-books and access to massive content databases. Many universities, including my own, today licence over a million e-books, many with perpetual licences. This means that even as some publishers and authors express concern about educational copying practices, they earn new revenues from digitally licensing their works to educational institutions.

What are some of the implications of the Canadian success story? First, on the domestic front, Canada is about to embark on a review of the copyright law that will serve as the foundation for future reforms. There is always room for improvement. We need better rules to support our ambitions on artificial intelligence and need to improve our notice-and-notice system for allegations of infringement to stop trolling activity, primarily from the United States, but we are starting from a strong position. In fact, Ministers Bains and Joly, in their letter to the industry committee on the review, note that since market disruption often drives copyright reform, the law may not always be the best tool to address the current state of technology-driven change. The ministers acknowledge that many issues fall outside the scope of the law, suggesting that efforts to use legal tools to impede changing marketplace dynamics may ultimately harm the very stakeholders the law is intended to assist.

Second, Canada should not shy away from engaging in cultural diplomacy to see its copyright rules adopted in other countries. For example, I’ve just returned from Hong Kong where I taught a short course at Hong Kong University. Many in Hong Kong have been particularly interested in Canada’s non-commercial user-generated content provision, noting it could provide much-needed safeguards for freedom of expression. Other countries have looked closely at our fair dealing approach and our Internet liability rules as potential models as well.

Third, these two issues converge when it comes to trade policy. Canada worked with the EU to craft a more balanced copyright framework that recognized both sides meet international standards and just led in the effort to bring the Trans-Pacific Partnership to fruition without the United States, which dropped out, successfully arguing that several unbalanced copyright provisions that went beyond international standards should be suspended. Indeed the suspension of provisions like copyright term extension and the digital lock rules helped create a more progressive agreement that may entice other countries to join.

Further, the recent Canadian approach helps establish a model for future trade agreements premised on meeting international standards of protection and progressive rights of access. The next step will be to bring our more innovative provisions into the trade realm, with obvious opportunities for Canada to position itself as a global copyright leader to the benefit of creators and users alike.

I look forward to your questions.

The Chair: Thank you.

Ms. Dickenson.

Christa Dickenson, Chair, Interactive Ontario, Canadian Interactive Alliance: Thank you, Madam Chair.

Senators, it’s a pleasure to be here. Good morning. My name is Christa Dickenson. I am Chair of the Canadian Interactive Alliance/L’alliance Interactive Canadienne, a nonprofit, non-partisan trade association representing over 3,000 companies across Canada in the interactive digital media industry through seven provincial trade associations. Hence, I’m also the CEO and President of Interactive Ontario, the provincial version of us. Interactive Ontario represents over 300 of those companies.

[Translation]

Thank you for inviting me here today to talk about the use and the impact of Canadian arts and culture in foreign politics and Canadian diplomacy. I am happy to share with you the experiences of our members, who export interactive multimedia digital content across the world.

[English]

The Canadian interactive digital media sector encompasses a wide variety of content that’s constantly evolving. That means formats from video games, mobile games, e-learning, apps, online storytelling, and what we’re hearing about a lot these days, augmented and virtual reality. It is evolving all the time, with new platforms that are frequently emerging, and that is why the IDM industry in Canada now generates $3.8 billion in gross annual revenue. As well, it employs over 26,000 full-time employees and earns approximately 50 per cent of its revenues from exports.

The CIAIC, Canadian Interactive Alliance, represents content creators, but not all of the content created fits a definition of Canadian content, because unlike film and television, there are no funding programs for IDM that specifically require a Canadian cultural content piece within it. Some forms of IDM, such as mobile arcade games, do not lend themselves naturally to a cultural definition. That being said, Canadian IDM producers have been creating beautiful and engaging Canadian cultural content that has been recognized around the world.

To name just a few: “The Long Dark” is a first-person survival game where a crashed bush pilot must survive the Canadian wilderness after a global disaster.

Another example, one you’ve probably heard of is “Polar Seas,” an early explorer of the 360 format, allowing viewers to feel like they were travelling in the Arctic.

“Floor Kids” is a really cool and very new piece of IDM. It is an action rhythm game for mobile that features the multicultural street style and music of Montreal.

“ReBlink,” for sure one of my favourite newer pieces, allows art gallery visitors to interact with gallery paintings using augmented reality and is currently in use with both Canadian and European collections at the Art Gallery of Ontario.

“SESQUI,” thanks to this government, is a multi-platform immersive experience created for Canada 150. It has toured through communities across Canada in 2017 and continues to be available online in multiple environments, including virtual reality.

Many other projects are less explicitly Canadian but still communicate Canadian values, and I think that’s a really big piece of our culture. Those values, for instance, are about collaboration, innovation, diversity and inclusion.

When Canadian arts and culture stands proudly on the international stage representing Brand Canada at its finest, it provides a shorthand for what it means to be Canadian. Every time that an IDM producer takes a meeting at an international marketplace or participates in an international trade mission, they are representing our country, Canada. When Canadian IDM producers partner with international producers and together both parties bring a product to market, they are stimulating both economies and both cultural sectors.

The Canadian IDM industry has always looked outside of Canada’s borders for business opportunities, and the CIAIC and member associations have actively encouraged growth through export. Each year, for instance, the CIAIC hosts a networking event at the Game Developers Conference in San Francisco. It is the premier international trade show and conference for mobile and video games.

In 2014 and 2015, Interactive Ontario published two reports to help IDM companies take advantage of international opportunities through best practices in co-production and information sheets on those specific countries. We actively work with federal and provincial trade officers to participate in trade missions and collaborate with international trade officers that are here in Canada, all for the goal of helping our members meet potential international partners.

As a result, the Canadian IDM sector has developed a reputation for world-class, high-quality content. IDM producers have been able to innovate with the support of some of the best government funding for IDM in the world. Programs like the Canada Media Fund’s Experimental Fund have helped Canadian IDM producers develop, produce and market forward-thinking content, all the while developing new audiences rather than just chasing the existing ones. This has been nothing short of instrumental to the growth of such a rapidly evolving, young sector.

As we mentioned in our submission to the government’s consultation on Canadian content in a digital world, Canada’s IDM sector is eager to collaborate with non-digital content sectors as well, such as the performing arts or visual arts, to bring our expertise in digital platforms and export markets to those sectors to help them reach broader audiences.

The project “ReBlink,” which I mentioned earlier, is an example of how technology can engage younger audiences and drive them to experience more traditional forms of art. It is also a terrific calling card for Canadian IDM and culture. Last week none other than Tim Cook, the CEO of Apple, dropped by the AGO to check out “ReBlink” in action. Really fantastic for us.

The biggest stumbling block is that those sorts of collaborations as far as sector-specific funding, i.e., funding for performing arts or IDM content, do not encourage or even allow for cross-sectoral collaboration. We see collaboration as both a fantastic business opportunity and a way to explore creativity.

Another challenge is getting to foreign markets to meet buyers and potential partners. While there are marketing and export funds at the Canada Media Fund and provincial agencies, they are, however, oversubscribed. The Trade Commissioner Service has been of great help, but often trade commissioners cover many different portfolios and do not have the time to develop a thorough knowledge of the interactive digital media or arts and culture in general within the territory they represent.

With support, the Canadian IDM sector could be a more useful tool in Canadian foreign policy and diplomacy.

[Translation]

On a personal note, I will say that the questions concerning the use of Canadian arts as well as Canadian culture in the context of foreign affairs are of particular interest to me. I grew up in the diplomatic service, because my father was the ambassador of Canada to Kuwait and Indonesia. So, I was able to notice the impact of Canadian culture abroad with my own eyes.

[English]

The Canadian IDM sector can bring all elements of the arts and cultural sector to wider audiences and can support foreign policy goals such as closer ties with international markets and selling the Brand Canada in support of other activities, all while exploiting foreign markets and growing their businesses.

If you have any questions, I’d be happy to take them at this time.

The Chair: Thank you.

Dr. Geist, you’ve been before us before on our trade studies and you had concerns in the intellectual property sections of the Trans-Pacific Partnership. You seem to say today that those have been suspended.

Given that, have all of your qualifiers, questions, reservations, been put aside, to the best of your knowledge, in this new deal that has been struck?

Mr. Geist: Thanks. That’s a great question. In terms of the entire TPP, no. But in terms of the intellectual property chapter, I think Canada, alongside many other countries, made a lot of headway. There’s still a digital trade chapter that has privacy implications — I think we talked about that one of the other times I was here — and those remain unchanged and are of some concern. Regarding the IP provisions, the Canadian government did a good job of leading with some of the other TPP countries and suspending some of the most problematic provisions.

The Chair: As I recall, the insistence of those other provisions that have now been suspended were really at the behest of one country that is not part of the process now.

Mr. Geist: It was an easier negotiation to get those removed.

The Chair: Thank you.

Senator Bovey: I want to thank you both for being here. I very much appreciate your insights, and your experiences and perspectives are critically important as we take a look at the past roles and potential roles for the cultural dimensions in Canada’s foreign affairs.

I was interested with what you said about the trade commissioners, Ms. Dickenson. I know this is a very real concern. The cultural world is diverse, and each one of the tranches, shall we say, in the cultural world is of its own ilk.

Your use of the word “collaboration” is absolutely critical. Earlier this week, I was meeting with galleries, libraries, museums and archives in collaboration. Breaking down silos is the essence of where they’re going.

When we put all that together, we heard from one witness yesterday who felt that the staff in the Canadian embassies and high commissions around the world need to be retooled — I’ll use the word “uptooled,” if it’s a word — for knowledge bases. If we look backward, we came from a time when there were cultural attachés alongside the trade commissioners. I feel there’s a huge amount of agreement on the importance of the cultural dimension in trade.

But I want to look forward now. As we’re on this platform, understanding that arts and culture are really the major profile of Canada for many, internationally, what should we be looking at by way of cultural diplomacy? Do we need cultural attachés back? How do we retool the staff? How do we give trade commissioners and people working within our embassies an understanding of the complexity of the arts community, and the richness of the arts community in solving other problems and taking our profiles abroad?

What would you recommend for us going forward?

Ms. Dickenson: Thank you for that question. The cultural attachés not being present for a few decades now has created a void. I feel strongly that retooling them is important. Back in the day, it was about being able to showcase — the icebreaker in the foreign country was talking about a piece of art work by Daphne Odjib or Norval Morrisseau hanging on the wall. Now, we’re consuming arts and culture differently; it’s a screen-based world. Being able to bring those examples to the forefront is incredibly critical.

Working with the trade associations that represent the various segments of culture and arts can be a solution to provide that crash course which is absolutely necessary.

Attending the conferences we put on that bring in the best and the newest examples of innovation is definitely a starting point. There are wonderful conferences, such as iVentures in Toronto, that portray these innovative products.

Senator Bovey: To follow up on that, do you feel that the impact and dimension of what the broad cultural sector of Canada is doing in every dimension — on the digital platform, the screen platform, and in the world of the real object or real dance performance — in all those ways, do you feel that the international community has a better sense of the substance of Canadian culture than Canadians do?

Ms. Dickenson: That’s really hard to answer. We’re really well known for being good storytellers as Canadians, and I think there’s so much more that we could be showing them as specific examples and bringing our Canadian values.

Back to that point about collaboration, diversity and inclusion, we have examples of art products. Those things talk about our environmental and climate change values through art.

Senator Bovey: Madam Chair, I’ll say one more thing. If you were to craft a cultural diplomacy policy for foreign affairs, what do you think would be the most essential element?

I’d be interested in both your viewpoints, because I certainly heard what Dr. Geist was saying with regard to copyright issues.

Ms. Dickenson: For industry, the Creative Canada Export Strategy will be launched in 2018. We’re really looking forward to seeing that. I find that government puts in place and in control of the missions that do take place, and reactively our companies are trying to fit in with them versus going to industry — digital media or any other — and finding out where the real opportunity and interest lie.

For instance, we see it in Asia. Interestingly enough, in bringing experts in those topics and inviting them to speak, we’ve noticed that Nigeria, of all places, is a tech hub. You wouldn’t necessarily know that if you’re not speaking directly to industry and canvassing them.

Mr. Geist: They say when you’re a hammer, everything looks like a nail, and when you’re a law professor, everything looks like a legal or regulatory issue.

I would say two things. First, and we see it with Minister Joly’s digital Cancon plan is that we need rules that encourage Canadian creators to be as outward-looking as possible. For too long, many of our domestic rules have been premised on creating walls and protectionist-type approaches. That’s understandable given how close we are to the U.S. market, but in what is a clearly globalized market today, the opportunity for Canadian creators has never been greater. But part of it requires a gradual rethink or a shift in approach, one that moves away from a knee-jerk view that what we need is a more protectionist toolkit and the way to adapt the current environment is to take old levy systems for the current environment. Instead we need to be much more outward focused and more confident about the prospect that Canadians do have great stories to tell and can succeed on a global basis.

I would also note, second, that if we take a look at how other countries approach things, there is a real link between intellectual property and copyright policies, and their cultural diplomacy piece. It’s no coincidence that the United States is by far the most aggressive when it comes to copyright rules. They were in the Trans-Pacific Partnership, and they are present in many other instances. They see a direct correlation between their national industries and the kinds of approaches that are adopted in other countries.

Especially recently, we’ve adopted a more progressive approach, one that I think would find a ready audience in many countries that look at their state of creativity and their cultural markets, and say that we’re not the United States. We need solutions that do a better job of reconciling the needs of creators and users. Canada, in many instances, offers up some real models there, and there are great opportunities for us from a diplomacy perspective to be more assertive in telling our story in how we’ve tried to land on some of these issues.

Senator Oh: Thank you, witnesses, for your informative presentation. I have a follow-up to the chair's earlier question.

Professor, you take issue with TPP’s intellectual property chapter. With the U.S. now out of the TPP, what is the role played by Canada as a major power with the remaining 11 countries in terms of reaching agreements that assert Canada’s priority?

From a cultural diplomacy perspective, what do you suggest our trade negotiators do to protect privacy and balance data localization requirements?

Mr. Geist: Thanks for the question. With respect to the first issue, as I mentioned earlier, my understanding is Canada did play a lead role in Da Nang as part of the efforts to try to suspend many of the provisions that many of the TPP countries were completely uncomfortable with -- as is quite clear in hindsight -- but were included there largely at the demand of the United States.

So I think it is striking to see many of those provisions removed and I think Canada, as the second largest economy in the TPP, has helped foster what I believe is a more balanced intellectual property, or IP, chapter.

And it is one that I think better reflects the interests of many of the other TPP stakeholders and I think will be far more inviting when we think about other countries in the region, such as Indonesia and Thailand, that were not part of the initial TPP. They may now find the TPP a more attractive agreement to enter, in part because it better reflects the needs of those countries in the way it does many of the others that have remained.

So I think we did a good job playing that lead role on IP. We didn’t do as good a job with respect to the digital trade chapter and these same issues are cropping up as part of the NAFTA renegotiation, especially around data localization and transfer.

It is a very tough issue. For those not familiar with it, this refers specifically to this notion that countries might create requirements that personal data and information be hosted locally within the jurisdiction or create some restrictions on transfers across borders.

On the one hand, I think we do want to encourage an open Internet, particularly for those countries that might seek to erect barriers and use data localization for purposes that we wouldn’t support; in some instances, anti-democratic purposes.

At the same time, there are, I think, legitimate concerns about some of the privacy implications of removing any ability to require that certain information be stored locally. In fact, our own federal government has a cloud strategy that requires that some information either not be stored in the cloud or that it be retained locally. If it’s good enough for the federal government, it seems to me that it ought to be good enough for individual Canadians as well.

So I do think it is a problem that those kinds of issues were not addressed within the TPP. They’ve been left unchanged and there’s reason to believe we might see them crop up again in the NAFTA renegotiation. It’s an issue that I think will only become more important as we recognize the massive amount of data collected by large international players and, in a sense, the prospect of losing some of the kinds of Canadian protections that we’ve tried to include in the law.

Senator Oh: When you mentioned Canada was the second most powerful economic power, are you referring to Japan being ahead of us?

Mr. Geist: Yes.

Senator Oh: What would you recommend for cultural diplomacy in this new world of mobile technology?

Mr. Geist: It speaks to the answers both of us gave to the previous question. There is a recognition that we live in a digital world and, increasingly, one in which people are accessing content on mobile devices from whatever the jurisdiction happens to be.

In certain respects, we still see efforts to try to erect virtual barriers through geo-blocking and geo-gaming. We actually just saw a suggestion or a recommendation from the Privacy Commissioner last week about imposing geo-blocking with respect to accessing certain search terms, which I must admit I find somewhat problematic.

We need to be thinking globally. We are starting to see some businesses do that. Netflix is a perfect example, as they have shifted more and more to creating their own content. Canada is one of the top three markets in which they create content. One of the reasons they moved in that direction is that they operate in 200 countries — a true mobile world — and they don’t want to run into the limitations that geographic licensing often entails.

I would argue that domestically, for too long, some of our Canadian broadcasters in particular have been very dependent on those walls. We’ve got Canadian broadcasters who make much of their money from getting Canadian-specific licences, often to U.S. content. I think that often undermines the kind of prominence and importance that Canadian content has, much less the control those broadcasters have over their own schedules.

We need those broadcasters to be creating their own Canadian content not because there are regulatory requirements to do so, but because it’s in their economic interest to do so in a world in which the streaming and mobile capabilities mean that Canadian specific licensing for foreign content will diminish over time. It is diminishing already as a matter of value and importance.

Senator Massicotte: Thank you both for being with us this morning. This is obviously very interesting.

I’m struggling a little bit. We’ve had many witnesses and this question comes up. A lot of this culture and technology is somewhat subsidized and funded by the Canadian public. So when we talk about the benefits of culture, it has to be more than simply our pleasure. It has to be a benefit to Canadians who basically invest in this industry.

Ms. Dickenson, you referred to your youth and said there were some effective events, and you saw it first-hand. In your mind, what does “effective” mean in that context? What is it you must do to say it is very good for Canada and very good for our Canadian contributors to the system?

Ms. Dickenson: Going back to those early days, I remember missions to various countries where the artists, per se, then ended up setting up shop. One is a jeweller, and the name of the artist is escaping me, but they have become a strong silver jewellery maker based on now having a factory in Indonesia. That was an incredible partnership for him to be able to become a world-class artist.

I think that there have been fewer of those types of cultural missions in the past and they’ve been very prescriptive. I think it’s about hearing about the business opportunity, so that specific example makes perfect sense based on the resources that are there and the craftmanship that appeals there, but with a Canadian design to it.

I think there are a lot of those opportunities that we’re missing in this day and age that we could be following up on.

Senator Massicotte: To follow up on that, you referred to the jeweller becoming a strong craftsman in silver. Is the fact that that support allowed this person to become very good at his trade good enough? Does it have to be a benefit to Canada and to Canadians for us to justify helping these people? Where is the tie-in?

Ms. Dickenson: At the end of the day, my feeling is that there are two things that are absolutely critical: economic growth and Canadian culture, and I don’t know that one necessarily outweighs the other. We’re looking for success stories.

There is currently an interesting partnership that is taking place called The Holy City. It is with Israel and Canada and it’s a VR experience where they are showing different types of religion within the city of Jerusalem and not areas that a tourist would normally see. So that accessibility to that information and those experiences in bringing it back to Canadian culture is reciprocal at the end of the day.

Those types of partnerships are phenomenal, and it speaks to our values. Being able to tap into that example is very unique. That partnership would probably not have occurred with a United States partner, but with Canada, yes.

Senator Massicotte: Could you respond to my question? How do you see the tie-in? The answer we’re getting is there has to be economic benefit for Canada because of trade. How do you see the tie-in? There’s obviously a significant tie-in in both factors.

Mr. Geist: I was actually having this exact conversation with someone last week. In the academic environment, I’m privileged to have an academic position that is publicly paid, I have a Canada Research Chair that’s publicly paid and sometimes I have the benefit of grants that help fund some of the work that I do.

For too long the academic community has published in certain journals and had to buy back the same research that, in effect, the public has funded once, twice and sometimes even three times. We’ve seen a strong shift to what’s known as open access and the notion that if the public has funded and paid for this, especially through the tri-councils, the public ought to be entitled to some level of access.

That doesn’t translate directly into the cultural space in all instances. I personally think there’s a lot of culture that we ought to be funding through the Canada Council and others that simply wouldn’t get created otherwise, so the benefit is that there are those Canadian stories and there is that Canadian culture being created, leaving the market aside.

But I certainly do think there are some spaces where some businesses in the cultural sector have been too quick to, in effect, dismiss what sometimes can amount to 50 per cent or more of their expenditures being covered by the public with little consideration about the rights of access. The sole notion is that we’ve got the exclusive right to commercialize and the fact that the public may have been central to allowing this to take place through its funding becomes very much a secondary consideration.

You see it in just about every book you open from a Canadian publisher. It will tell you all the funding agencies that went to the heart of allowing that book to be created. Just above it, it will tell you “all rights reserved” and that you have no rights to use this, sometimes misstating the types of exceptions and user rights that exist in the Copyright Act.

We need to be thinking a bit more in some of these areas about funding where there is, I believe, a quid pro quo, and public rights of access to things the public has funded ought to be part of the discussion.

Senator Massicotte: Let me elevate the question a little bit more. If you were responsible for all funding of cultural activities or diplomacy in Canada, what would be the two criteria you would set to say strong merit or no merit? How would you define that? Obviously, somebody is making a choice to fund or not to fund. We heard a lot about different criteria, but in your mind what should they be?

Mr. Geist: Again, I would use the academic world as an analogy. I think we fund basic research, whether in the sciences, social sciences or health because it’s good to fund research and do basic research without necessarily knowing what the results will be.

I similarly think it is good to fund culture without necessarily knowing what the results will be, without having any guarantees about the economic benefits that might arise because I think that’s what a country like Canada is privileged to be able to do.

At the same time, though, with regard to some of the funding, particularly the funding that gets driven by economic benefits, sometimes we see groups trying, on the one hand, to argue it’s all about Canadian stories, but when challenged on the economic benefits saying, “No, it’s all about jobs.” I think both are considerations, but where we move into funding that is driven primarily by economic benefits, we need to give more careful consideration about the outputs and then levels of access that come with that.

Senator Cordy: Thanks very much to each of you for your presentations today. It’s been very helpful and it’s been an interesting study to look at diplomacy through the eyes of culture. This is very helpful.

Dr. Geist, you gave some very interesting statistics today about our being the sixth largest producer in the world of music. The 2013 Internet revenue was $13 million. Are Canadians understanding how important culture and music production and creative production is to the economy of the country? What is happening is significant.

Mr. Geist: It is significant. Just to be clear, we’re the sixth largest music market, not necessarily in terms of the amount of music created — I don’t know where we rank in that regard — but rather in terms of the revenue generated by the industry. That does highlight how it is a real success story taking place.

I must admit I do feel that much of the debate has unfortunately devolved into industries sometimes talking about how great they’re doing in annual reports, and then, when they want to get government funding, talk about how bad things are going when they want to talk about new copyright rules or other sorts of regulatory measures. It seems to me it’s hard to have it both ways. I think the reality is that there have been real successes. That’s not to say that everybody has transitioned into the digital world. Of course, there are real challenges in doing so.

But the Canadian story to date and, frankly, what we heard especially around interactive media is one where Canada has been a world leader. Do Canadians recognize the importance of this? I think Canadians value it greatly and what we’ve seen is that the way they value it greatly is that they’ve responded increasingly as the industry has finally responded in providing well priced, convenient, viable, authorized alternatives.

I can recall appearing before committees like this one not that long ago and hearing from members of the House of Commons and senators who were lamenting the notion that people would never pay for music. Yet, here we are today generating tens of millions of dollars and people paying for music, and what it took was not copyright laws but, rather, an industry that began to recognize that they had a customer to service and they needed to provide well-priced, convenient alternatives. That’s precisely what we’ve seen in that sector and we’ve seen it in a number of sectors now, which helps to explain some of those expenses.

Senator Cordy: Netflix is an example.

Mr. Geist: Netflix is an obvious example.

Senator Cordy: Ms. Dickenson, you spoke about one of the biggest stumbling blocks in receiving government funding is that the cross-sector collaboration is difficult. We look at government. Often we have silos, even departments not necessarily working together. Could you explain how this could be solved and made a little bit easier? Things aren’t the way they were 50 years ago.

Ms. Dickenson: Right. The funds that exist today have been pre-existing for a long time. It is pre-digital media to a certain extent. There isn’t any incentive to be working for two companies to come in together on a project on any of the funding agreements that currently exist.

For instance, if it was a virtual reality project, with a digital media content creator that’s working with a health care partner or museum, that is not a collaboration that is being subsidized in any way, shape or form.

We’re all here to answer the question, simply put: Why invest in culture when it comes to exports?

Today, we are at a point where we really have to be a little less risk-averse—very much to your point, Michael—about taking those risks and that is how we’re going to find innovation that works.

As well, regarding the biggest export, everybody talks about oil, but after that, what are the top exports worldwide? They are cars and devices. So all the content that’s being consumed on these devices is what we’re talking about when we talk about culture and digital media.

To me, it’s a no-brainer. We really have to put some weight behind it, and this is the time.

Senator Ataullahjan: Thank you for your presentation this morning.

Looking at the changing population in Canada where we have so many ethnicities, I have heard of these boxes that are available that people buy for a couple of hundred dollars and then pay $10 a month, and then they watch shows from all over the world. A lot of the different ethnicities will watch shows from back home.

How does that affect the Canadian broadcasters? I know a lot of people, who, if they had cable are not watching cable because of all the regular channels that are available on those boxes, and they get a lot of international content also.

Is that awareness there in the industry? I don’t know if these boxes are legal or not legal, but I think they are about $200 now and some people pay just $10 a month. Is that impacting the Canadian broadcasters?

Mr. Geist: It is. You’re referring to Kodi boxes, and there’s a reference to open-source software that allows people to access many kinds of extremes, some authorized, some unauthorized.

You’re quite right to highlight that for many Canadians it is the lifeline home in being able to access, in many instances, lawful content streamed in their home jurisdiction and now available here.

The way we’ve seen its effect most dramatically, I would argue, with little exaggeration that broadcasters have gone to war against these boxes.

In fact, we saw a proposal just this week, led by Bell, which includes a number of other players, asking the CRTC to create a mandated blocking system where the CRTC, without direct court oversight would, through a new anti-piracy agency, identify sites that are often used by these boxes and require that Internet providers block access to them.

From my perspective, it’s an enormously problematic proposal from a freedom of expression and net neutrality perspective, and I’m not convinced it meets either the existing communications laws we have or the Charter of Rights and Freedoms. It does highlight the way we are seeing a dramatic shift in how people access content, so-called “cord cutting,” whether using those boxes or simply relying on Netflix or other sorts of services. It is obviously having an impact on some of Canada’s broadcasters. I think, in some instances, rather than directly compete, whether it’s in price points or different offerings, we’re sometimes seeing them shift hard towards trying to find legal mechanisms to stop some of those activities from taking place.

That’s not to suggest that everything that takes place on a Kodi box is lawful. It’s not. But it is worth noting that Canada has, as I mentioned, some of the toughest anti-piracy laws in the world, including a provision we created in 2012 that allows rights holders to go directly after sites that facilitate infringement. We also have a Supreme Court of Canada ruling that allows for court orders to go after sites and content that are in some instances located outside the jurisdiction. So we already have strong rules, but rather than competing effectively and recognizing that this reflects choice and, in some instances, lifelines for people, what we’re seeing is the beginning of some strong legal battles brewing.

Senator Ataullahjan: Also the cost. I have regular cable and my bill is over $160 a month. Here it’s the one time and then maybe $10. That’s something that a lot of people take into consideration too.

My other question to you is this: Is this the last century that we’re going to see hard copy books? That’s something that worries me. E-books and everything that’s coming on digital media, my concern is there are still some of us who like to hold a book.

Mr. Geist: I believe the market will continue to provide for people that still want that, and I agree with you; there’s still something that doesn’t quite replace books. Although I travel a lot and having access to e-books makes a huge amount of difference.

I think it depends a little bit on some of the kinds of content. That’s purely speculative. I think for newspapers or news content it’s fairly clear that the physical is on its last legs at this point in time. I still really like reading the Saturday morning paper with a coffee, but my kids look at me like I’m nuts.

I think for many that shift has already happened and it will be very unlikely we will move back in the other direction.

For other kinds of content I think there is still a convenience and an experience that comes with the physical that won’t be so quickly replaced. I think they can stay side by side alongside one another for quite some time.

Senator Cools: I would like to thank the witnesses for coming before us and also for assisting us to grapple with what I think are some extremely difficult contexts and content.

I wonder if you could help me. I keep hearing people use the words “Canadian values.” Many years ago, when I was a very young woman, I had a university professor who always discourages the use of the term “values” to mean principles and who would tell us that values are what you buy at Sears.

I think I grasp — because it is a common expression, “Canadian values,” and I think I have an inkling of what people mean, but I wonder if you could provide me with an explanation. I have no doubt you have done a lot of research on these types of conceptualizations.

Mr. Geist: I’m sure Christa can offer up some views as well. I think in some ways it’s a fairly personal question because I think for a lot of people how they perceive Canadian values probably in many instances reflects their own interests or experiences. In my case it reflects a country that is inclusive, one that’s accepting from an immigration perspective. My grandparents were Holocaust survivors and welcomed my family after that. I’m cognizant of the need for open borders and for recognizing that there are successive generations of people from different places around the world who are experiencing, in a sense, the same kinds of things my family did. I think Canada does well when it stands for those kinds of things.

I think it is a country — and you have it a little bit in stark contrast with what I think we’re seeing in the United States today — where you see inclusivity in the sense of raising everyone up and recognizing the value of each person and not relying solely on market-oriented approaches in every instance.

Those are some of the kinds of values that I think of when I think of Canadian values. I think some of the kinds of rules and policies I focus on seek to reflect that, whether it’s in our privacy laws that seek to recognize the importance of personal privacy and the protections that come from that so people can feel free to speak and engage without things in their background necessarily being exposed in a harmful way, trying to strike appropriate balances from a copyright perspective so that we ensure that creators create and enjoy the fruits and benefits that come from that creativity but that the public benefits as well from access and can join in that creativity as well.

I think we see some of those same kinds of values imbued in some of our laws and I guess in some ways it’s a great question, because there’s an opportunity to take those same kinds of values and bring them to the international stage. I think we live in a particular moment in time where there’s a great appetite for those kinds of approaches in contrast with what we see elsewhere.

Ms. Dickenson: I’d like to build off what you said. Thank you, Michael.

Thank you, senator, for the question. I think Canadian values, and values in general, we grow up with them at home, as a student and part of student council, there are values that are set up. You sign up for a corporation. You often decide based on the values of the leaders and the corporate culture. It surrounds us.

Canadians, like your family, mine came from Ireland and Ukraine. They were farmers. They came to Canada because you could have a good life, it was fair, it’s equitable.

Canada is at the forefront of saying gender parity matters and all types of equity matters.

For instance, I have with me, behind me, Deirdre Ayre, the CEO of Other Ocean, one of our member companies from Atlantic Canada. She is a female owner of a company and through that parity and the points that are being provided now on applications to the CMF is receiving some grants based on the fact that there’s a female lead in a few of the projects she’s working on.

I’m so happy to see that we’re calling that out as important. We are always looked at around the world as a fair country and one that’s enviable. I think that values are something we should be proud of. I’m proud to be a Canadian because of our principles.

Senator Cools: I have a suspicion we are all very proud to be Canadians, but you are saying something which is a lot more profound than it appears. I have done a lot of study and reading on the development of the Constitution of Canada.

For example, if you look to the British North America Act, currently called the Constitution Act, 1867, section 91 says the Parliament of Canada should make laws “for the Peace, Order and good Government of Canada.” You contrast that to the Americans and their “Life, Liberty and the pursuit of Happiness.” The difference in the structure of the sentences and even the meaning of the sentences is really remarkably different.

I have studied every single Constitution of Canada, beginning with the 1763 Royal Proclamation, then the 1774 Quebec Act, then the Canada Act, 1791, and the 1840 Act of Union. Every single Constitution of Canada repeats those words, “for the Peace, Order and Good Government of Canada.”

I do not know of anybody else who has observed this. I have been doing a lot of reading in preparing a speech where I will talk about this particular fact. It is quite a huge intellectual piece of work.

When I ask you to explain to me what you mean by the term “Canadian values,” I think it is something even deeper than we realize when we just say “Canadian values.” There is something profoundly different in political people’s approach to politics in Canada than there is in the United States of America. But I am not a sociologist and that has to go to other generations to study.

Ms. Dickenson: Nor am I, but it certainly resonates with me what you’re saying, Senator Cools.

Senator Cools: There is another expression that occurs and it is called the exact image and transcript -- that Canada wanted to create in its constitutions the exact image and transcript of Great Britain.

So there are two of these terms that recur through all of these documents. I hope you find all of this interesting.

Ms. Dickenson: I’m making notes. I found it very interesting. I’m going home and researching this.

Senator Cools: I just have an interest.

Ms. Dickenson: I love walking away having learned something.

Senator Cools: I have copies of these documents. It is a big problem I have. I collect paper. That is why I want to hang on to both, you see?

The Chair: Good point. Can I just pick up on that from a different angle?

We talked about digital and intellectual properties and it hits culture in a different way. The misuse of it. Sometimes governments are identified with not presenting culture but presenting propaganda. We believe we’re not doing that, but other countries sometimes think we are, so there are blockages.

Dr. Geist, how do we disseminate and encourage our Canadian culture without falling into the trap of having input into another country which then can be taken not to be as friendly from our side? We know the intrusions that are coming into our country, and often under the guise of culture, dance, song and television channels.

Mr. Geist: My view on diplomacy in this context is that you lead by example rather than lead by demand. The difference between how the U.S. approaches, especially on this file, where it uses things like the so-called “piracy watch list” in which 70 per cent of the world’s population finds itself on this list with the U.S. basically accusing the entire planet of not meeting the standards it thinks everybody should meet with respect to intellectual property protection and then turns around and uses various measures to try to demand that they make changes.

I don’t think that’s the right way to go. In many instances I think they’re wrong and Canada has rightly rejected many of those attempts. The better way and the ultimately more successful way and the way that is more in keeping with Canadian values, so to speak, is to lead by example in these areas, to demonstrate how we have adopted more progressive approaches on many of these issues, and then, by educating others about the kinds of approaches that we’ve taken and — and this is one of the reasons I led with this in my opening remarks — demonstrate that it is working. You provide others with real-world examples that they might choose to follow.

The Chair: Ms. Dickenson, all of these new creative endeavours on video games and everything that I am told about — I want that on the record because if I misstate it, it’s because I’m not into that world — a lot of the young people in high school create a lot of these, and they watch, they get an idea, they talk to their friends and they develop something, and with great difficulty sometimes or just ingeniously it’s done. But when they hit a different plateau where they really want to disseminate, they often have to sell out because they say there’s not the kind of investment in letting them grow, so their own good alternative is to sell and move on; maybe another video game, et cetera, or buy into it, which is often offshore.

How do we continue to support them? Some tell me they need more supports, but others say that some of our rules, some of our taxation systems and even interprovincially, are impediments to their growth.

Ms. Dickenson: When it comes specifically to interactive digital media there are restraints and it goes back to not enabling collaboration. For one province to work with another, the tax credits don’t work well together. Similarly, I think of tying back a little bit to your question around propaganda, I don’t think that very many of us in this country are propagandistic by nature. I don’t know if that’s a word but that’s all right. When we go abroad culturally we’re looking for collaboration and partnership. Therefore, it isn’t propaganda. For instance, the CMF has treaties with 25 countries for film and television. We do not have it for digital media. That would be fantastic. This would be a great starting point. And it would enable and answer your second question around how can we avoid the selling out of our IP. You’re absolutely right that the content creation isn’t only from the traditional producer, but there’s a lot of user-generated content out there, some of it very viable, and becomes the next large company that we would love to see. We need to encourage it.

I would also love to see funding for slate development, so to speak, versus project by project, so that in effect you’re investing in that company and that talent so they can say, “These are the four projects I have this year,” and allow one to succeed and one to fail and two to be okay.

Senator Neufeld: Thank you. Very interesting. I don’t usually sit on this committee. I’m just filling in for someone. But it’s interesting to listen to the discussion.

What I find interesting is the comparison that’s made by some of us and the witnesses about the U.S., and this is better in Canada than it is in the U.S., and on and on. I think I’d rather use the term that you used and lead by example than saying something in the U.S. isn’t right.

When I go to the U.S. or I watch the odd hockey game, or see sports happening and people stand up to sing their national anthem, they put their hand over their hearts, they take their hats off generally and they sing it. I love Canada, but I don’t find that same kind of thing happening in Canada. Maybe you can help me a little bit there. People are just a little more timid to sing our Canadian anthem and why should we be? We’re very proud of our country.

When I hear that it bothers me a little bit, because I think they’re very proud of their country for all of their reasons why they’re proud of their country, like we are of our country.

Also, we’ve got tremendous talent in this country: singers, songwriters and all of those types of people. But they don’t get their name into the stars just in Canada; they do it by going where? The United States. They must be doing something right there too, because it draws everybody down there and they become very well known, and should be, for their talent.

Maybe you can help me a little bit with my viewpoint about Canada and the United States.

Mr. Geist: I would say two things. First, having attended a number of either playoff hockey or baseball games, a couple of Blue Jay playoff games a couple of years ago, as well playoff games here in Ottawa, I’ve never been and never seen in the United States arenas or stadiums in which the singer does not sing and yet 20,000 or 50,000 people in unison sing their national anthem quite like they do in Canada. So I must admit that my experience at least in observing some of those events is that Canadians sing the anthem loudly and sing it very proudly.

In terms of the United States, I would never want to be taken to suggest that there isn't a great deal of really great things in the United States, including two of my siblings who live there. But I will say that I think part of the Canadian values discussion and part of leading by example is also speaking up when appropriate. With all due respect, when I see what the United States has been saying and doing with respect particularly on the issue of immigration, but similarly on issues around gun control and the like, I believe it’s incumbent on Canada to speak up and I don’t think that’s anything in the United States to be proud of.

Ms. Dickenson: You talk about specific talent going over to the United States and becoming successful. There’s no question that we are a large country with a small population so there’s only so much that we can sell here. What I like to look at are also the success stories such as Cirque du Soleil, which is completely international. I hope from the policy discussion we’re having today around culture and investing in it, we will see multiple other companies of that calibre in the years to come that we are all proud of with the Canada brand.

Senator Neufeld: Thank you.

The Chair: That brings the committee to an end.

I travel to unusual places and I can be in a small kiosk in a strange little side of some African country and Céline Dion is being played. They don’t know it’s Canadian. They know it’s good. The message I’m taking out of this is that we do have excellent talent. We need to do more about it. And it can be a tool for trade; it can be a tool for cultural development.

This committee will have to try to put it all together in some positive way to assist Canadians in terms of what we’re capable of, because I think that’s what we want to do. We want to bring that talent forward; I think you were saying “generating” it. I think that’s good, and we will have to see what role government could or should play, particularly with foreign policy. We’re not here discussing — although it impacts us; the intra-provincial is always a problem for us. But we’re really talking about foreign policy and how do we put in the cultural factor in a modern way. That’s really what we’re trying to do. We think we’ve bitten off a little bit of something unique and hopefully we will contribute to the debate, and the policy debate especially, in Canada.

Thank you for your input today. It has made us go in different directions than we have to this point. I appreciate your attendance today.

Senators, we will go in camera.

(The committee continued in camera.)