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The post-CD world: federal MPs set to study challenges faced by music industry

Stephane Dion in Ottawa, December 13, 2011. THE CANADIAN PRESS/Adrian Wyld

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Stephane Dion in Ottawa, December 13, 2011. THE CANADIAN PRESS/Adrian Wyld

OTTAWA - It might be as rare as scoring front-row tickets to Arcade Fire, but the Conservatives are getting opposition praise for one of their budget moves.

Guaranteeing money for the Canada Music Fund and other arts programs in perpetuity also got applause from various industry groups.

Now government and opposition MPs are on the same page about a Commons study into the music industry as a whole, set to begin this week.

It's the first time the Canadian Heritage committee has undertaken such a study.

Liberal MP Stephane Dion, who proposed the idea, says it's long overdue.

In the last decade, the music industry has gone through a revolution as consumers shifted to digital downloads from CDs.

Figures from the Library of Parliament suggest that the market value of Canadian music sales decreased by 20 per cent between 2008 and 2012.

"You have an industry in full revolution and need to look very carefully at how the federal government can adapt its own help," said Dion.

Said NDP heritage critic Pierre Nantel, a former music producer: "There have been so many changes, what can we do to help the industry regain their lost sales?

Committee chairman Gord Brown, an Ontario Conservative, said determining whether the government is getting value for money is central to the study, as well as determining whether the industry is getting the proper help.

Currently, the federal government supports the industry through both monetary and regulatory measures. On the cash front, the $25-million Canada Music Fund helps artists create and promote their works. The $18-million Canada Arts Presentation Fund supports festivals and other venues that bring homegrown musicians to audiences.

Meanwhile, the Canadian Radio-television and Telecommunications Commission oversees rules that require radio stations to dedicate as much as 40 per cent of their programming to Canadian content — a 40-year-old system that has been credited with making Canada's industry one of the biggest in the world.

Stuart Johnston of the Canadian Independent Music Association said there's nothing wrong with the current funding mechanisms, but they might need some tweaking.

As Johnston describes it, Canadian labels have gone from focusing on a few pots of money for their livelihoods, such as CD sales and concerts, to dipping into myriad pots — some only producing pennies at a time, such as royalties from streaming music.

And these small businesses have also had to figure out how to properly reach consumers in a vast domestic and international digital marketplace. Making sure the funding helps in those specific areas would be one area for tweaking, Johnston suggests.

"No longer do (the labels) record their great artists and they use technology to distribute and post it, but they have to use that same technology to discover where their fan bases are and discover new fans and help those fans discover new artists," said Johnston.

"So you have to sort of be able to rise above the noise in many ways. So there's another challenge but also a fantastic opportunity."

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