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The Private Copying Levy Distortion

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Monday February 27, 2006
The Copyright Board of Canada last week released its proposed tariff for 2007 for the private copying levy.  The numbers remain unchanged: 21 cents per CD-R.  As prices have dropped, however, the levy now frequently comprises a significant percentage of the retail price.  Consider the purchase of 100 blank Maxell CDs.  Future Shop retails the 100 CDs for $69.99.  The breakdown of this sale is $48.99 for the CDs and $21.00 for the levy (even worse is a current Future Shop deal of 200 blank CD-Rs from HP, which retails for $59.99.  The levy alone on this sale is $42.00 (200 CDs x 21 cents/CD) which leaves the consumers paying $17.99 for the CDs and $42.00 for the levy). 

This results in a huge distortion in retail pricing when compared to the U.S. market which does not have a levy system.  For example, the same Maxell CDs retail for US$34.99 at CompUSA.  When you add in the exchange differential, the Canadian cost is just over $40.00.  Obviously the price is slightly lower in the US even without the levy (35 cents per CD vs. 40 cents per CD).  With the levy, the price increases by another 50 percent.

Given how little Canadians get for their money (the private copying right doesn't cover copying CDs to Apple iPods) is it any wonder that countries such as Australia are considering allowing for such private copying without a levy scheme?  The solution in Canada is obvious: either ensure that the levy covers the full panoply of private copying as is the case in France or drop the levy altogether and institute a fair use user right.
Comments (12)add comment

brem said:

...
Fortunatly, DVDs seem to not be included in the legislation. Am I right?
February 27, 2006

Doug said:

How about software?
So this levy is supposed to compensate for piracy. My company is Canadian. We make and sell software, and we use silkscreened CD-Rs for distribution. We have to pay the levy for our disks.

So we have to pay the levy to distribute our own work. And our product is also subject to piracy. So shouldn't we be getting a piece of the levy, rather than paying for it?

This is just a tax on our business to support someone else's. It doesn't make any sense.
February 27, 2006

Thoma Traynor said:

Anything the consumer can do?
Is there anyone we can send our comments to? I am in the process of scanning family documents (1Gb so far) and am about 20% done. I use CDs once a month to backup all of my personal data permanently and I don't like subsidizing someone else or being catagorized as a crook.
February 27, 2006

spencer said:

All media, not just CDR
"Fortunatly, DVDs seem to not be included in the legislation. Am I right"

sadly this will effect any sort of recordable media.
the proposal reads:
"“blank audio recording medium” means
(a) a recording medium, regardless of its material form, onto
which a sound recording may be reproduced, that is of a kind
ordinarily used by individual consumers for that purpose and
on which no sounds have ever been fixed, including
(i) audio cassettes (1/8 inch tape) of 40 minutes or more in
length;
(ii) recordable compact discs (CD-R, CD-RW, CD-R Audio,
CD-RW Audio);
(iii) MiniDiscs; and
(b) any medium prescribed by regulations pursuant to sections
79 and 87 of the Act (support audio vierge);"

So everythign except Ipods, because of a 2004 court decision they were classsed as not being recordable media.

the proposal does not list a levy for DVD + or -r, but I suspect thisis a typo. DVD's will probably have a levy of 77 cents per disc.


February 28, 2006

Jaded said:

Fair Use
1 week ago I found a copy of a Canadian Supreme Court Judgment dated November 2005, stating that all downloading and copying is legal as long as it's for personal use. And that included copying to put on personal media devices.
February 28, 2006

Maarten said:

All For Musicians?
The proceeds of this levy are given to musicians publishing associations.
I would submit that more CD's and DVD's are used to copy ("pirate") software and movies than music.
Another example of how lobbys run the government...
February 28, 2006

Happy Lemming said:

A disincentive
Think of the 21-cent levy as a reason not to buy blank CDs. DVDs are cheaper, have better error correction, and take up less shelf space. They won't keep the RIAA in cocaine and callgirls, but that's not my problem.
February 28, 2006

Alan Klugahmmer said:

I agree
I am a photographer and I record my own work onto CD's. Why should I pay a royalty to any music industry. It doesn't make sense. I am paying a tax to a totally unrelated industry for a totally unrelated purpose...
February 28, 2006

Dwight Williams said:

If there\'s gonna be a levy...
...I'm tempted to demand that we writers, illustrators, web page designers, et al. get a piece of that pie as well.
February 28, 2006

Duncan Murdoch said:

I like private copying
Michael, I expect to be flamed for this, but I have to disagree with you and most of the other comments so far.

I like having the right to make private copies of music. I would rather not change to the US style fair-use rights: they don't allow me to make my own copies of material that I haven't purchased, and I like being able to do that.

Thoma Traynor raises one good point and one bad one: she doesn't like paying the levy on CDs that aren't used for music. Either do I, but I can't think of a way to target the fee more specifically.

But she also says that she doesn't want to be categorized as a crook. She's not! Personal use rights mean that anyone copying music for their own use is *not* a crook. That's the point of the levy: to compensate copyright owners for this right.

Doug complains that he pays the levy for software CDs that he produces, but doesn't earn money from the levy. The difference between software and music is the price: I doubt if it would be to his benefit to allow free personal copying of his software, because he probably charges much more for it than is charged for a music CD. (If he doesn't, then there are certainly other software companies who do.)

Jaded got it right:
you are not able to copy to your iPod because Apple has crippled the iPod with DRM, not because of any legal reason.

The copyright levy isn't perfectly targeted at music copying, but it is a reasonable compromise to prevent US-style anti-copying lawsuits from succeeding in Canada. People want to copy music, why do you want to make it illegal?
March 01, 2006

Rich Trump said:

CPCC levy for music ONLY plz
The part of this tariff that burns me the most is that I'm paying the CPCC for the media on which I back up my hard drive. The recording industry can bloody well keep its grubby paws out of my pocket, thank you very much. Somebody should teach those creeps a lesson.
March 01, 2006

a guest said:

...
I'm considering this my civil right to copy. Coping levy...jesus.
March 22, 2006

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