Ringtones and the Copyright Board's 6% solution

Fourteen months after its hearing of the inaugural “ringtones” tariff filed by SOCAN, and based upon a lengthy interrogatory process that began in 2003 and during which a major party (that happened to be my client) withdrew, a three member panel, including the Chair, of the five person Copyright Board has certified SOCAN’s Tariff 24 for Ringtones at a base rate of 6 per cent of the price paid by the subscriber for the ringtone, net of any network usage fees with a minimum of $0.06.

This tariff was strenuously resisted on several grounds, the most important of which was that the objectors believed that there was no legal liability. It was argued that the mechanism for selling ring tones was functionally no different than the delivery of a CD containing the ringtone file to the consumer - and that it was thus not a communication “to the public”, i.e. there is no “tapping into” on ongoing performance.

As I post, the reasons have finally appeared online.

An update will follow. This decision will be very important in several other pending matters.

We will try to assess whether this is a 6% solution or the beginning of more judicial review and controversy, with significant impact well beyond your cellular telephone bill.

HK