Examination of Witness (Questions 300-319)
LORD CARTER
OF BARNES
CBE
10 DECEMBER 2008
Q300 Chairman: The commercial sector
is under enormous pressure, partially because of the regulatory
burdens you describe, partially because we are going into a recession
where advertising revenue is falling through the floor, partially
because of the pressure from the BBC, which is now 56%, if not
higher, in terms of market share. The commercial sector is seriously
talking about pulling out. If you want DAB to continue, is that
a case for government intervention?
Lord Carter of Barnes: I think
there will have to be some form of government intervention, even
if it is only intervention to look at the regulatory burdens.
If you mean by "government intervention", money—
Q301 Chairman: Yes.
Lord Carter of Barnes: Again,
I genuinely do not know enough yet to be able to answer that question,
but there will definitely need to be further expenditure on transmission
capability to get coverage of DAB national, if that is what we
want to do.
Q302 Chairman: Is that something
which the Government might support?
Lord Carter of Barnes: It is definitely
something that we intend to have a view on by the end of January.
Q303 Chairman: Right. So it is under
active consideration?
Lord Carter of Barnes: It is.
Q304 Chairman: You would not like
to go beyond "active consideration"?
Lord Carter of Barnes: Not this
afternoon!
Chairman: I did not think you would!
All right. That is helpful, thank you.
Q305 Rosemary McKenna: Can we move
on, Minister, to, I think, the important issue in your remit and
that is harmful content on the Internet and in video games, and
ask you about the UK Council on Child Internet Safety? Has the
Government met the timetable to date for implementing all the
commitments in the Byron Review Action Plan published in June?
Lord Carter of Barnes: I would
not like to say categorically "Yes" because you inserted
the word "all" into your question, Rosemary, and I am
not sure I carry all of the recommendations, but my understanding
is, broadly, yes. Tanya Byron is on the steering board of this
project in order to make sure that we do (a) stay connected on
these questions, because they are, as you rightly say, important,
and (b) it is another way really of just underscoring the Government's
enthusiasm for making sure the recommendations of the Byron Report
are embraced and implemented. The Council is underway. It had
its first meeting, I think, very recently. So my sense is that
progress is being made on the agenda. I would not want to give
you a personal undertaking that all of them have been met because
I just do not know for a fact.
Q306 Rosemary McKenna: One of the
issues which concerned this Committee most during our investigation
was the fact that Google and YouTube, for example, were not prepared
to undertake to actively monitor what was put on their sites and
the industry in general seemed to think that a take-down time
of 24 hours for the removal of child abuse was an acceptable standard.
Would you like to develop what you think the industry ought to
be doing and what we can do to make sure they do it?
Lord Carter of Barnes: On that,
I do think we are making a lot of progress, not necessarily on
the specific take-down times but I think we are making significant
progress, and here I think the UK Council has been a very effective
mechanism for getting all of the material players in this around
the table with a common sense of ownership and willingness to
participate. As I am sure you will have heard during the Byron
Review—and I think Dr Byron is very compelling on this—there
are enormous issues of practicality around effective monitoring
and companies are understandably nervous about signing up to delivering
something which actually they do not believe is deliverable. Where
we are at is a point where there is now, I think, a common understanding
of shared responsibility amongst the ISPs and the other players
and we are getting to common standards, and I think that is a
good place for us to be. I will stop there, and we may go further.
Q307 Rosemary McKenna: What about
the coding on the video games? Is there progress on that issue?
Lord Carter of Barnes: There was
an outstanding question, I think, on that between the two different
standards, about whether you were referring to the PEGI standard
and the BBFC standard, and that is, I think, due to be resolved
either this side of Christmas or early in the New Year because
I think in the Byron Report it was left as a kind of question
to be answered, whether or not you could look at the double standard.
I have to say that my instinct on that is that I think clarity
is better, to be honest. I am uncomfortable with dual systems
and video games operate in a different market from films. Having
said that, there are legitimate issues of recognition and clarity
and those we are getting to the bottom of. So I think that will
be a decision in early January, or perhaps even possibly before
Christmas.
Q308 Rosemary McKenna: But you are
working with schools. That is important, is it not, that through
the schools the parents understand that they have a responsibility?
Lord Carter of Barnes: There has
been a lot of work done by, I think, the PEGI standard since the
Byron Review. One of the many good outcomes from the Byron Review
has been to get the retailers, the games manufacturers, schools,
parents together in one place to come up with the improvements
necessary to give people the confidence to adopt that as a single
system.
Rosemary McKenna: Thank you.
Q309 Janet Anderson: The video games
industry is very important in this country, but they say they
are being overtaken by other countries like Canada, where they
get tax concessions, much in the same way we do with our film
industry here. Is there anything going on in Government about
possibly extending tax concessions to the video games industry?
Lord Carter of Barnes: I have
heard that argument from the industry, and indeed we have had
representation in the context of the report, actually, and I certainly
share the view that the games industry is a significant form of
creativity as well as being an important industry. Most of their
focus actually, certainly in conversation with me, and I can only
tell it that way, has been around the classification issues rather
than around commercial incentives or tax breaks. I think it is
also related to technological capability, to go back to Nigel's
question around broadband capability, speeds and take-up. The
more that gets enhanced, the greater the opportunity to use on-line
applications and games and it makes the market more attractive.
So I have not heard the tax incentive argument as a primary argument
from the industry.
Janet Anderson: Thank you.
Q310 Chairman: Can I move to another
issue which I referred to briefly earlier which is on your desk,
which is the need to try and support the creative industries by
helping them deal with the problem of illegal file sharing. It
appears that some progress was being made towards achieving an
agreement between ISPs and content providers about measures to
be taken to combat illegal file sharing, but now it appears there
is still some gulf between the two different camps. Are you confident
that you can achieve an agreement between the two?
Lord Carter of Barnes: I am not
sure I would characterise it as a gulf, but there are definitely
significant issues between the different parties involved in that.
As you know, there is a consultation which was put out on a signed
and shared Memorandum of Understanding between the various parties
and I am having a series of quite detailed discussions with all
involved parties to see if we can find practical and operational
common ground. Am I confident? Yes, reasonably confident. I think
we need to be clear as Government as to what our priorities are,
and the truth of the matter is that our priority in this is that
it is another area where, like in many of these issues, you do
have to balance conflicting interests. I personally do not think
it is legitimate of the content owners to say, "This is a
problem solely for the ISPs." I do not. But equally, the
ISPs do have some shared responsibility here and if we are going
to accelerate broadband take-up, if we are going to accelerate
broadband provision, if we are going to get faster speed rates,
if we are going to have mobile broadband with the sort of capacity
we would like, we have to have an environment in which content
creators can trade their intellectual property. We just do. It
would be the Wild West without it! We would spend an enormous
amount of money on infrastructure and then there would be no way
of monetising the application's content. It would not make commercial
sense, let alone cultural sense. So we do have to find it. This
may seem like quite a technical issue, but it is a very important
principle issue for where we are going more generally, I think,
in a digital economy. So we are very focused on trying to find
a workable solution. I have said to both parties, or all of the
parties (it is not quite as similar as both parties because different
people are in different places), "We very much see this as
a shared responsibility so we want to see some common plans from
everyone involved."
Q311 Chairman: Let me try you on
one specific potential problem. The content providers want the
ISPs to take punitive action against their own customers on the
basis of no absolute proof of them having done anything wrong.
That raises potential legal problems. Would you consider providing
some kind of indemnity for ISPs who do take action of that kind?
Lord Carter of Barnes: I think
the question is (if I can put it in a different way), can we find
a mechanism for a system which provides for a clear and visible
notification process for people who are clearly abusing the systems
and abusing the content?
Q312 Chairman: When you say "clearly",
it is never going to be entirely clear, is it?
Lord Carter of Barnes: No, it
is never going to be entirely clear, but you can get pretty close
to entirely clear and if the notification and advisory and warning
system is done in the right way, I do not think that needs to
get to the point of individual ISPs being responsible for turning
off their own customers. If I was running an ISP business, I would
find that a difficult thing to do, having spent all the money
building the platform and acquiring the customers. But equally,
as I say, there does need to be some shared responsibility for
where people cross the line.
Q313 Chairman: Are you still optimistic
that this problem can be addressed and solved without legislation?
Lord Carter of Barnes: I would
much rather it was solved without legislation, but if we need
to have legislation we have been very clear, I think, from the
very beginning that we would consider that.
Q314 Chairman: The content providers
are quite plainly of the view that there does need to be legislation.
Lord Carter of Barnes: I am sure
they do say different things to you than they say to me, but it
depends upon which content providers you talk to, on which day
and on which business model they are in. They have different views.
Legislation is a marvellous thing, but it is also a fixed thing
and I am not sure in this market we necessarily think that however
cleverly drafted, with however much foresight, we could devise
a legislative solution which would be as perfect as a much more
effective, commonly owned self-regulatory notification system
shared by the content owners and the platform operators.
Q315 Chairman: This is essentially
a question of the protection of intellectual property. Why are
you doing it and not the Minister responsible for intellectual
property?
Lord Carter of Barnes: Well, I
am working intensely closely with the Minister for Intellectual
Property, and indeed the gentleman who runs what is now, I think,
called the UK IP, Ian Fletcher, sits on my steering board. It
is slightly going back to the question earlier. It is not two
departments. The Department for Innovation is a big part of this
area. As for the historical reasons why this was done by BERR
rather than DIUS, I just do not know, but it was taken as a commercial
responsibility, I suspect.
Q316 Chairman: Is it not the case
that you should take on responsibility for this since it is so
much part of the whole area for which you are responsible? It
would make much more sense to put IP under you as well, would
it not?
Lord Carter of Barnes: I do not
think that is necessary. I think what is required—and this
is what we are doing—is making sure that any of the work
we are doing around how do you create a safe environment in the
digital economy, particularly for creative IP but also for other
IP and does not conflict or undermine the broader IP rules and
trading environment. As I am sure colleagues around the table
know, intellectual property is not a domestic matter anyway, it
is a regional and global issue. The current system, I think, of
shared responsibility works and, as I say, David Lammy and Ian
Fletcher are very, very closely involved in this particular technical
question.
Q317 Chairman: Can I just test you
on another area within your Digital Britain Review? Obviously
high up in the list of issues on your agenda is the future of
public service broadcasting. Would it be right to say that the
Digital Britain Review has now taken over from the Ofcom PSB Review?
Lord Carter of Barnes: No, it
would not. I think it slightly goes back to your comment about
review ennui. The Ofcom PSB Review is a statutory requirement
they are required to do once every five years by the Communications
Act. I think they have had two phases of the latest review. I
think there was a pretty clear sense in the first, let alone the
second, and I am sure again in the third, that there was a need
for Government to take this under its own wing because there is
a limit on the Regulator's remit. The Regulator can update and
advise, but cannot decide. So I think the Government taking responsibility
is a natural next step.
Q318 Chairman: Have you yet reached
any views between the various options which have already been
set out in the Ofcom Review?
Lord Carter of Barnes: No, we
have not, and I am not sure we would necessarily say that the
options in the Ofcom Review are the only options. There are others.
Where we are in process terms is that we are rightly paying attention
to what Ofcom has done so far in terms of analysis. We are talking
to all the parties involved. We are, I think, literally in the
process of appointing our own advisers to look at what work has
been done by the various parties involved and we will try and
bring that together as a common piece of work.
Q319 Chairman: What are the options
you would like to look at which are not in the Ofcom Review?
Lord Carter of Barnes: As I recall
from the Ofcom Phase 2 Review, their options largely revolve around
what you might describe as existing institutional structures as
opposed to whether or not there is an opportunity for new structures
and I think it would be odd to look at the question without looking
at it with a blank sheet of paper as well as an existing sheet
of paper.
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