UK publishes ‘Digital Britain’ interim report

March 2009

All areas

Stephen Carter’s interim report on Digital Britain has just been published and the full document with annexes can be found at

The UK Government has become fairly obsessed with regulatory authorities and building on the recent ‘memorandum of understanding’ between leading Internet Service Providers (ISPs) and copyright owners a new report proposes a new anti piracy agency to stamp out music and film piracy in broadband Britain. The report, an ‘interim’ version of Digital Britain has 22 recommendations covering areas such as universal access to broadband and the future of digital radio, but the section dedicated to rights and distribution will be the part of the report that is being scrutinised by the music industry and the ISPs. By the time the final document is published in late spring, the government says that it will have “explored with interested parties the potential for a Rights Agency to bring industry together to agree how to provide incentives for legal use of copyright material; work together to prevent unlawful use by consumers which infringes civil copyright law; and enable technical copyright-support solutions that work for both consumers and content creators”. The approach is described as “civil enforcement of copyright” agreed by distributors and rights-holders. Such an agency would require a “modest and proportionate contribution,” according to the report – described in the Times as a “£20 broadband charge to fight online music and film piracy’ and there are already suggestions that ISPs would pass any such cost on to broadband customers. Opposition MPs suggested the new agency would create yet another layer of bureaucracy for consumers and the music industry. In light of the perceived damage to the grass roots music scene in England and Wales caused by ther Licensing Act 2003 and unibtended side effects of regulating the security industry (not to mention the smoking ban and noise at work regulations) there is some truth in this and a quango might be the last thing the industry needs, but existing collection societies such bas the PRS and PPL have been effective in providing blanket licences for clubs, pubs, venues and broadcasters so to any extent can be effective – although an agency actively engaged in civil copyright enforcement is another matter altogether. Even the heavily litigious Record Industry Association of America has quietly pulled away from lawsuits against individual downloaders and we just hope the Government takes some time to think about what really works – and prioritises new workable business models above yet more regulation. It is a fairly lengthy document so we though we would highlight three ‘actions’ that might be of interested to those involved with the entertainment industries.

Action 11 
By the time the final Digital Britain report is published the Government will have explored with interested parties the potential for a Rights Agency to bring industry together to agree how to provide incentives for legal use of copyright material; work together to prevent unlawful use by consumers which infringes civil copyright law; and enable technical copyright-support solutions that work for both consumers and content creators. The Government also welcomes other suggestions on how these objectives should be achieved.
Such an approach would need rights-holders and distributors of all digital material (e.g. music, film, television and radio, software, computer games, e-books) to work together to develop ways of making this kind of piracy more difficult to do and easier to trace and prevent. This could involve working with authorities in other countries to act against damaging sources of infringing material. It could also include the exploration of new technical approaches to the content itself or its transmission, including common standards.
This body could carry on the work started by the Memorandum of Understanding on unlawful file-sharing. It should provide the forum within which all elements in the value chain – content creators, initial aggregators (e.g. studios or broadcasters), theatrical distributors (e.g. cinema chains), networks, ISPs and other parts of the chain – could come together. Within the boundaries of competition law, this could lead to the development of models that provide incentives for all for legitimate downloading and use, a framework of common responsibility to discourage and prevent illicit use, and to support and legitimise technical solutions that can achieve both. Developing new business models is primarily for industry to do, not for Government or any new body. But working together on enforcement and education mean there needs to be clear advantages to all sides – a win/win/win for rights holders, intermediaries and consumers. Rights holders and intermediaries should each reap the economic benefits of delivering a better service to consumers.

Possible technical solutions are addressed Automated Content Access Protocol is one example of a technical solution. Digital Rights Management (DRM), properly applied, also has a role (i.e. where it allows users to access content on any device that they own, rather than being device limited – which is the paradigm that the film industry has encouraged and one that, in music, Apple’s iTunes has now embraced, in a welcome recent co-operation between rights-owners and a device/ distributor). Both can work when they are technical-enabling solutions that match market trends and go with the grain of the market and legitimate consumer demand. But they have yet to command the assent, let alone active support, of all the necessary players along the internet value-chain. It may be that such an independent, objective body may be better able to surmount the mutual tension between rights-holders, publishers, search engines and other content aggregators, the ISPs and the underlying communications network operators and instead broker technical solutions that can command widespread adoption and support. We also recognise that, while industry co-operation should be at the core of this, such a ’Rights Agency’ may need to have the power to act to ensure that enforcement measures are effective and proportionate. If the UK can develop such a working forum, we will have an advantage over most other countries.

Action 12
Before the full Digital Britain Report is published we will explore with both distributors and rights-holders their willingness to fund, through a modest and proportionate contribution, such a new approach to civil enforcement of copyright within the legal frameworks applying to electronic commerce, copyright, data protection and privacy to facilitate and co-ordinate an industry response to this challenge.  It will be important to ensure that this approach covers the need for innovative legitimate services to meet consumer demand, and education and information activity to educate consumers in fair and appropriate uses of copyrighted material as well as enforcement and prevention work. The Government also recognises that there is a more specific problem that needs addressing on unlawful file-sharing, where we have been clear in the Creative Britain paper and elsewhere that we would legislate if necessary. The consultation on how we might tackle this issue closed at the end of October. We have today published a Response to that consultation which can be found on the BERR website, which sets out our analysis of the responses and how we intend to proceed. None of the options highlighted in the consultation attracted widespread support. Rather there was a marked polarisation of views between the rights holder community, consumers and the ISPs over what action should be taken.
A number of key issues were identified by respondents including copyright protection, protections afforded under eCommerce legislation and the impact on the wider economy. Consumers (individuals and consumer organisations) in particular highlighted concerns over data protection and privacy. The role of technology was addressed by most respondents but there were conflicting views as to whether it could offer all or part of any solution. For almost all the options, questions were raised as to their legality under the existing legal frameworks and again, views varied. Our preferred option of co-regulation did not attract widespread support. The key problem highlighted was the lack of certainty over the nature of the obligation on ISPs and the resulting legal uncertainty this would create for all parties. There remained major concerns how consumer protection would be properly addressed, while developing the self-regulatory aspect through a code of practice raised significant questions on how to accommodate other rights holders, the smaller ISPs and consumer bodies. This was borne out by the experience of the current Memorandum of Understanding group which showed that despite the best endeavours of all concerned, reaching voluntary agreement where there is little perceived common interest between the various participants is extremely hard. There was, however, a degree of consensus that any solution must involve the provision of new legal sources of attractive content, and that there is a need for education on the importance of copyright in the wider economy.

Action 13
Our response to the consultation on peer-to-peer file sharing sets out our intention to legislate, requiring ISPs to notify alleged infringers of rights (subject to reasonable levels of proof from rights- holders) that their conduct is unlawful. We also intend to require ISPs to collect anonymised information on serious repeat infringers (derived from their notification activities), to be made available to rights-holders together with personal details on receipt of a court orderWe intend to consult on this approach shortly, setting out our proposals in detail.

This should provide a good evidence base, to make it significantly easier for rights-holders to take targeted legal action against the most significant infringers. International experience of action of this sort suggests that more than two thirds of infringers change their behaviour when receiving notification. These obligations will form the central elements of a Code on unlawful file-sharing which Industry would be required to have in place, supported by backstop powers overseen by Ofcom. The Code would cover among other issues practical supporting measures, including appeals and standards of evidence. It would also cover cost-sharing.
We think the concept of a new Rights Agency and legislative action aimed specifically at addressing unlawful peer-to-peer file-sharing could be major steps forward. But this is new and difficult territory, and we want to get it right. So we will review the impact of any new measures, and will not hesitate to examine other options if these do not prove to be effective.

Published by The Stationary Office for  BERR (Department for Business, Enterprise and Regulatory Reform) and DCMS (Department for Culture, Media and Sport).

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