WASHINGTON D.C. - The Canadian government has yet to pass the necessary laws to comply with two international copyright protection treaties, writes Dr. Michael A. Einhorn in " Canadian Quandary: Digital Rights Management, Access Protection, and Free Markets," a Progress on Point released today by The Progress & Freedom Foundation. In the paper, Einhorn explores the lack of anti-circumvention protections in Canadian law. The author also provides an analysis of the economic importance of technology protection measures.

In order to comply with the World Intellectual Property Organization (WIPO) Copyright Treaty and the Performances and Phonograms Treaty, Canada must enact anti-circumvention provisions. In his paper, Dr. Einhorn, Intellectual Property Consultant and Former Professor of Law at Rutgers University, notes that Canada has yet to comply despite a commitment to do so. He argues that this lack of statutory protection of technology protection measures (TPM) results in weak copyright protection in the country. To illustrate the harm of having failed to implement such a measure, the author points to recent statistics concerning the use of file-sharing software by Canadians. One study states that 37% of Canadians admit to downloading music via file-sharing software, compared to 18% of those polled in the US.

Dr. Einhorn also sees a correlation between record sales and broadband penetration. "By rapidly hastening the speed by which digital content can be downloaded on the Internet, broadband is a primary enabling transmission mode for file-sharers," Dr. Einhorn theorizes. Using data from Organization for Economic Co-Operation and Development (OECD) member countries, the author demonstrates a correlation between broadband deployment and declining CD sales.

TPM provides a legal remedy against unauthorized distribution and copying of works, providing incentive for the creator, argues Dr. Einhorn. This protection also allows for "versioning" of services offering such digital content, creating more competition in the digital content market. "With versioning, smaller and first-time users may gain from having a 'no frills' service, free previews, or limited time introductory offers. However this will happen only if these products cannot be repackaged and made available to high-end users, who could otherwise be expected to choose a more deluxe version with a higher price. For their part, the more intense users of any product can be expected to wind up paying more, but they may benefit nonetheless because producers have greater incentives to innovate and introduce more deluxe features in order to monetize more of the high-end base," Dr. Einhorn states.

" Canadian Quandary: Digital Rights Management, Access Protection, and Free Markets" also addresses privacy concerns and looks at the positive uses of DRM for licensing arrangements and alternative compensation systems. The complete paper can be found on the PFF website.

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.