Memorandum submitted by The Royal Society
for the Encouragement of Arts, Manufacturers and Commerce (RSA)
KEY RECOMMENDATIONS
— When assessing the impact on the
creative industries of new technology, there should be an acceptance
that economic and social benefits of creativity and innovation
are best served by shifting the balance of intellectual property
(IP) protection away from rights holders towards consumers.
— The use of Digital Rights Management
(DRM) technology acts against the public interest by unnecessarily
restricting access to creative output.
— The principle behind the Creative
Archive is very much to be welcomed—people and organisations
should only need to pay once to access material produced at public
expense. But the full benefits of this approach in promoting economic
activity will be lost if DRM technology is deployed too widely
and if the prohibition against commercial exploitation of the
content remains in place.
INTRODUCTION
I am delighted to make this submission to your
timely inquiry on behalf of The Royal Society for the encouragement
of Arts, Manufactures and Commerce (the RSA). The RSA is an independent,
non-aligned, multi-disciplinary registered charity with over 22,000
Fellows.
The encouragement of learning and creativity
has been the fundamental aim of the RSA since its inception in
1754. The creation, protection and utilisation of bright ideas
is critical to this, as the RSA recognised when it drew attention
to the parlous state of the country's Patent laws in the 19th
Century and continues to do so with its various projects today.
One such project, the Adelphi Charter on Creativity,
Innovation and Intellectual Property responds to a profound challenge
of the 21st Century: how to ensure that everyone has access to
ideas and knowledge, and that intellectual property laws do not
become too restrictive.
The Government's appointment of Andrew Gowers
to review the UK's IP framework is a unique opportunity to examine
the fitness for purpose of this country's complex IP protections.
Spurred by the challenges presented by new media and new methods
of content distribution, this should be a root and branch review
from which some basic principles of IP management and reform are
established. Such principles would provide a coherent basis for
the further development of IP laws, in which the balance between
rewarding and encouraging creativity and protecting the public
interest is properly maintained.
IP PRINCIPLES AND
THE ADELPHI
CHARTER
Managing the ownership of ideas is crucial to
any country's economic and creative success—it shows that
speculative effort can be rewarded and encourages innovation.
The contention of the RSA Adelphi Charter is that today's intellectual
property laws often fail to serve the public interest, and regularly
work against it.
In the case of the availability of pharmaceutical
drugs in the developing world, for example, the interests of large
corporations are in potential conflict with a clear public health
emergency. And yet this is only the most high-profile example
of the public interest being done a disservice—in music,
for example, access to the creative genius of generations is increasingly
restricted to serve the interests of large recorded music corporations,
not the young artists of today.
Drawn up by an international commission comprising
distinguished scientists, artists and legal experts, the RSA Adelphi
Charter, launched in October 2005, sets out new principles for
copyrights and patents, and calls on governments to apply a new
public interest test to any systemic change. The charter calls
upon national governments and the international community to adopt
the following fundamental principles:
— The purpose of intellectual property
laws should be to enhance creativity and innovation.
— Governments should ensure their IP
laws serve as a means of achieving creative, social and economic
ends and these laws must not take priority over basic rights to
health and education.
— The public interest requires a balance
to be struck between the monopoly rights implicit in intellectual
property laws and the free competition that is essential for economic
and creative vitality.
SPECIFIC PROPOSALS
The Charter is predicated upon a public interest
test, which requires that:
— Intellectual property protection
must not be extended to abstract ideas, facts or data.
— Patents must not be extended over
mathematical models, scientific theories, computer code, methods
for teaching, business processes, methods of medical diagnosis,
therapy or surgery.
— Copyright and patents must be limited
in time and their terms must not extend beyond what is proportionate
and necessary.
— Government must facilitate a wide
range of policies to stimulate access and innovation, including
non-proprietary intellectual property models such as open source
software licensing and open access to scientific literature.
— Intellectual property laws must take
account of developing countries' social and economic circumstances.
— There should be an automatic presumption
against extending intellectual property laws. The advocates of
change must demonstrate why their proposals are in the public
interest.
ADDRESSING SPECIFIC
POINTS WITHIN
THE COMMITTEE'S
TERMS OF
REFERENCE
There are two aspects within the Committee's
terms of reference that are of particular interest to the RSA,
which I shall address in turn: the impact of Digital Rights Management
technology and the matter of the BBC Creative Archive project.
DIGITAL RIGHTS
MANAGEMENT (DRM)
You specifically ask "what steps can or
should be taken—using new technology, statutory protection
or other means—to protect creators" in respect of the
dissemination of their creative content.
The relevant protective measure here is the
increasingly widespread use of what have become known as DRM technologies.
Their growing prevalence is a concern for the RSA not simply because
of what such technologies are capable of in the abstract, but
because that prevalence risks becoming self-continuing—the
more a company becomes dependent on the restrictive power of software
to ring fence access to content, the more it will invest in ever
more sophisticated mechanisms for doing so. Given the Adelphi
Charter and the RSA's presumption that there is an economic upside
if systems of access to knowledge are as free as possible, this
proliferation is clearly a negative development.
This is also the view of the National Consumer
Council (NCC), which believes proliferation would undermine consumers'
existing rights under consumer protection and data protection
laws.
The NCC, which has campaigned against the proliferation
of DRM use by copyright owners in the recorded music sector, goes
so far as to challenge the traditional view of consumers as being
at the end of a value chain merely being supplied a range of products.
The NCC makes the point that this view ignores the range of ways
in which value is created in a modern knowledge-based economy—"and
the role consumers can, and do, play in innovation and the co-creation
of products and services".
THE CREATIVE
ARCHIVE
The second specific point within your terms
of reference on which we hold strong views is the issue of the
BBC-led Creative Archive project and the extent to which the balance
of rights holders and consumers is out of kilter. Our view is
that a lot more needs to be done to ensure that in the rush to
update the IP legal framework for the digital age, the interests
of consumers and citizens are adequately represented.
The Creative Archive is a project whose rationale
strikes the RSA as hugely worthwhile; it registers the fact that
publicly funded creative output has already been paid for by consumers/taxpayers
once and should not therefore be charged for again through copyright
licensing arrangements. It also, regularly throughout its publicity
materials, states as its aim the promotion of new forms of creative
endeavour.
For both these reasons, the RSA consider the
Creative Archive licensing arrangements to be very much a step
in the right direction—and a model we would like to see
replicated across other forms of publicly funded information.
We have two concerns on this matter, however,
reflecting the view that, at least in its implementation, the
Creative Archive concept does not go far enough. The first relates
to DRM technology, which—as we have indicated above—was
used extensively in the Creative Archive pilot; to ensure that
the terms of the licensing agreement through with the Creative
Archive is accessed are complied with.
Our second concern is based on the prohibition
of the commercial exploitation of material within the Archive,
which seems to us to undermine one of the central benefits of
any liberalisation of the IP legal framework—that it would
promote new forms of economic activity that would comfortably
outweigh the initial cost. The RSA is in the process of commissioning
research that will quantify this opportunity cost and I will revert
with additional information when it becomes available.
CONCLUSION
Despite these caveats, the concept of publicly
funded material not needing to be paid for twice is immensely
important and is one that should be replicated across different
forms of public sector information.
A clear example of this is the use made of weather
data, which the United States Government makes available to anyone
at the cost of reproduction. The information may be provided for
free, but a thriving private weather industry has sprung up that
takes the publicly funded data and then adds value to it. In the
UK, such data is sold on at a premium under Crown Copyright.
One study estimates that whereas Europe invests
€9.5 billion in weather data and gets approximately €68
billion back in economic value—a seven-fold multiplier—the
US invests twice as much (€19 billion) but gets a return
of €750 billion, a 39-fold multiplier.
I attach a briefing note covering RSA's views
on this subject in more detail that I trust you will find of interest.
I also attach a full copy of the Charter itself for your review.
(not printed here)
28 February 2006
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