Select Committee on Culture, Media and Sport Fifth Report



We are in the midst of a transformation in the way that viewers and listeners access and consume media content. The move from analogue to digital broadcasting, the growth of broadband access to the internet, and the development of new platforms such as mobile TV are all giving consumers a far greater choice over what they watch and listen to, and when and where they do so. As a result, whole new markets are opening up for creators and broadcasters and this is empowering consumers who are no longer forced to accept the narrow range of offerings of a limited number of broadcasters at a particular time. At the same time, it also creates new challenges for the creative industries and their regulators to ensure that consumers are protected and that creators are able to obtain their due reward while not stifling the spread of creativity and knowledge.

The pace of change is so rapid that solutions to some of the problems that we sought to address have already begun to emerge. However, at the same time, new challenges are being posed by technological developments that are now coming to market. The ease with which consumers can now access content, copy it and keep it, makes the protection of intellectual property and enforcement of copyright law of far greater importance to the health, and indeed the survival, of our creative industries than ever before. Some have argued that the rights of intellectual property owners should be limited in order to promote the spread of knowledge and creativity. However, we take the view that this is a matter of choice for the creators and that rights owners who wish to retain control over the use and exploitation of their material should be able to do so. We also believe that the level and period of remuneration as well as the future direction of the development of technology are generally best left to the market to determine.

With this in mind, we welcome the agreements that have been reached between producers and broadcasters over the ownership and duration of rights to distribute content through new media applications. This is much more preferable than a solution imposed by Ofcom, although we believe that it will need to be reviewed once the market has developed further and business models are clearer.

Where Government and regulators do have a clear role is in setting the legal framework and enforcing it, particularly to combat piracy, both in its traditional and on-line forms. Perhaps prompted by the Gowers Review of Intellectual Property, we welcome recent moves by the Government to strengthen intellectual property protection, particularly by at last requiring local trading standards to take enforcement action and by resourcing them to do so. However, we believe that more should be done to send out a strong message that this matter is taken seriously—by increasing the level of damages for infringement and by making it illegal to camcord a film being shown in the cinema, the principal way by which illegal copies are first obtained.

We also believe that there needs to be greater clarity in the law in order that there is no confusion among consumers about what is and what is not permitted. We therefore agree with Gowers that there should be a limited exemption to allow consumers to copy content which they have purchased for their own private use, in whichever format they choose. In doing so, the law will legitimise what is already an almost universal practice, and we do not accept the argument that a levy should be introduced on hardware or software in compensation. However, we do agree with the music industry that it is unfair that performers do not enjoy the same rights as composers and artists and we therefore believe that the Government should press the European Union to extend the copyright term for sound recordings to at least 70 years, as is the case in many other countries.

The failure of consumers to understand the reasons for observing copyright and to appreciate the damaging consequences of piracy makes enforcement far harder. We congratulate the industry on initiatives to increase awareness through initiatives in schools and elsewhere and call on all those with an interest to make this a priority. In particular, we believe that internet service providers and search businesses, whose growth is driven in large part by the availability of audio visual content, should be doing much more to prevent piracy, for instance by establishing an industry-funded body to address the problem similar to the Internet Watch Foundation.

As Britain's biggest and most powerful broadcaster, the BBC will have a powerful impact on these emerging technologies. We would expect it to set an example by stressing the importance of observing copyright and believe that this message needs to be clearer if its plans for establishing a Creative Archive go ahead. We will also monitor closely the new governance arrangements to ensure that the market impact of proposed new services is fully taken into account by the Trust before permission is given to proceed.

We share the general view of the Government that attempts by the European Union to apply the same regulations for non-linear services as presently apply to linear broadcasting are misguided and doomed to fail. We welcome the recent move to restrict such ambitions to on-demand broadcast services but remain convinced that self-regulation by the industry and consumers offers a more realistic and practical approach.

The creative industries already make a major contribution to the UK economy and this is likely to continue to grow. The rapid take-up of new media offers enormous opportunities for both consumers and businesses and we welcome the increasing recognition of this. We look forward to the publication of the Government's own Green Paper and hope that this will include many of the measures that we have recommended.

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Prepared 16 May 2007