Music publishers want more money out of the Canadian Broadcasting Corp. for the rights to play their music, after the broadcaster launched an online streaming music service that allows listeners to hear thousands of songs a day on their computers and phones for free.
The fight will be closely watched by other online music providers, who charge subscribers a fee and are operating in a new industry with few parameters in place. Popular American music sites such as Pandora and Spotify are avoiding setting up in Canada until a clearer royalty picture emerges.
CBCMusic.ca has attracted hundreds of thousands of listeners since it launched last month, offering dozens of channels tailored to specific tastes. Unlike its competitors, it doesn't pay a per-song royalty. Instead, it pays a flat-fee because it technically doesn't earn any profits.
That has also attracted the attention of the country’s artists, who feel the broadcaster is taking advantage of its current royalty scheme by unexpectedly launching a service that plays thousands of songs a day on the site’s 40 genre-based channels.
The Society of Composers, Authors and Music Publishers of Canada (SOCAN), which handles royalties for more than 100,000 music publishers in Canada, said when it set a flat fee for the broadcaster, nobody envisioned a constant stream of free music flooding the Internet.