Hargreaves Review of Intellectual Property

Written evidence submitted by The Publishers Association

INTRODUCTION

1. The Publishers Association (‘the PA’) is the representative body for the book, journal, audio and electronic publishers in the UK. Our membership of 113 companies spans the academic, education and trade sectors, comprising small and medium enterprises through to global companies. The PA’s members annually account for around £4.6bn of revenue, with £3.1bn derived from the sales of books and £1.5bn from the sales of learned journals.

2. The PA greatly welcomes the Committee’s timely inquiry into the Hargreaves Review recommendations and the government’s proposals to implement them. We fully endorse the submissions made by the Alliance Against IP Theft and the Creative Coalition Campaign to the Committee.

3. In summary, the PA’s view of the Hargreaves proposals and plans for implementation is as follows:

(i) the Hargreaves Review is right to identify areas of copyright legislation which need to be amended so that copyright is effective in the digital age: proposals for reform on orphan works and library archiving (similar to those which had been identified in the 2006 Gowers Review) are urgently needed to ensure the continued development of the digital economy.

(ii) we broadly support the concept of a Digital Copyright Exchange to help facilitate licensing of digital content for online services. However more detailed work is required in outlining how the DCE would operate.

(iii) The Review’s proposals for extending the scope of European legislation with regards to data and text mining ("DTM") are fundamentally flawed, would not achieve the desired effect, are unnecessary, and seem likely to be contrary to EU and international copyright law.

(iv) The Hargreaves Review was predicated upon identifying policies which would lead to stronger growth in the UK economy. However, there is no evidence provided by the Review to support the belief that a DTM exception would do this.

4. More generally, we maintain that:

(i) Copyright underpins the creative and knowledge economy. It is recognised by the UK High Court as a fundamental property right. Copyright ensures there is a reward to creators and an incentive to investors. It provides the legal foundation to the ability of companies to sell and licence works and to innovate in new products and services.

(ii) If the British publishing sector were languishing at the bottom of international league tables, routinely failing to make an impact on the global stage, it may be possible to sustain a case for amending the copyright regime. However, the converse is true. British publishers are world class. The sector exports more as a proportion of its output than any other country’s publishers. And the following statistics tell a further positive story:

· Science, technical and medical (STM) journals employ over 10,000 people in the UK and generates over £800m of annual export revenue.

· 70% of revenues are from electronic products.

· Globally, STM publishers receive 3 million article submissions a year.

· 1.5 million articles are accepted, reviewed, edited, produced, disseminated and preserved.

· The worldwide audience is 30 million researchers, downloading over 2 billion articles a year.

· The UK accounts for a 6% share of articles published and for 14% of the world’s most highly cited articles.

(iii) Publishing companies have as their raison d’etre the dissemination of knowledge and they do this by investing millions of pounds in technical systems and platforms which support scientific research. Any notion that publishers are a hindrance to the development of scientific progress is a fallacy – and one which is dangerous for the future of the British economy.

(iv) Any policy proposals which seek to undermine or weaken copyright – as the Hargreaves Review does and with which the Government has said it agrees – must therefore be analysed closely to ensure that they will not limit the health and success of British companies. This is especially the case when our major competitors, notably the US and China, are taking active steps to strengthen the copyright support afforded to their creative and knowledge companies. It is concerning that the UK government appears to walking in the opposite direction to that of these major economies when it comes to copyright support.

DETAILED VIEW ON RECOMMENDATIONS

Data and Text Mining

5. Of all of the 22 recommendations made by the Hargreaves Review, it is the proposals on Data and Text Mining ("DTM") that are of the greatest concern to the publishing sector. The proposal on DTM is one of the most radical, yet it is also one of the least thought-through, being unsupported by any economic analysis. The PA believes that the introduction of a new exception to allow untrammelled DTM (either through amending the European Union Copyright Directive or as an interim measure in the UK) would be an unnecessarily blunt instrument that would not take into account complex variables which can be more appropriately dealt with by a well-functioning permissions and licensing system.

6. Hargreaves bases his argument on the statement: "Copyright, once the exclusive concern of authors and their publishers, is today preventing medical researchers studying data and text in pursuit of new treatments." ( page 1). The Government echoes Hargreaves’ sentiments by stating: "nor does Government regard it as appropriate for certain activities of public benefit such as medical research obtained through text mining to be in effect subject to veto by the owners of copyrights in the reports of such research...".

7. Both the statement in the Review and in the Government Response are a gross mis-representation of the position of scientific publishing on DTM. The faulty analysis does not reflect the position of the scientific publishing community, nor does it appear to be grounded in a full appreciation of the likely future direction of DTM.

8. Copyright protects the expression of ideas and facts, not the ideas and facts themselves. Publishers lay no claim to such ideas and facts, whether they are expressed in words or as data. Scientific publishers will often provide a link to such data from articles in their journals and may even host it as supplementary data, but generally they do not claim copyright in the data themselves. However, where publishers have invested in the presentation of the underlying data (e.g. through normalisation into a standard form, the addition of controlled vocabularies, making of corrections and updates and curation) then it is entirely reasonable to expect some return on this investment.

9. In distinction to the data, the journal article which is based upon it is clearly not simply a set of facts, but an expression of those facts in a way which gives them meaning, explanation and context. It is copyrightable and reflects the investment by the author in the creation of the article and the publisher in the acts of registration, validation, certification, dissemination, navigation and preservation.

10. Put simply, DTM requires the downloading of all the content – both the data and the journal article – to the miners’ systems. Thus copyright content has to be reproduced and repurposed; and these acts require the rightsholder’s permission.

An Unnecessary Instrument

11. Fundamentally, publishers are fully supportive of DTM and regularly respond to requests from third parties to grant permissions or licences. There is compelling evidence to show that publishers are readily responsive to research-based DTM requests. A recent study by the Publishing Research Consortium into Journal Article Mining found that over 90% of publisher respondents report that they grant research-focused mining requests (approximately 60% of these in most or all cases, another 33% for some cases). This report was not available at the time the Hargreaves Review was collecting evidence. We believe the Select Committee would find this report of enormous interest and a copy can be accessed at: http://www.publishingresearch.net. (The author of this report, Eefke Smit, would be available to provide the Committee with further information, in either written or oral form.) It should also be noted that 100% of abstracts are available for DTM.

12. In advocating a DTM exception, the Hargreaves Review appears to rely heavily (if not solely) on the case made by the Wellcome Trust for a DTM exception in order to analyse historic data on malaria research. The Wellcome Trust states that 87% of the works in UK PubMed Central ("UKPMC") are not available for data and text mining. Whilst this statistic may be correct, it is highly misleading to use UKPMC as a frame of reference in this debate, for a number of reasons.

13. First, because the malaria example speaks more to the need to resolve the issue of orphan works than to the need for a DTM exception.  In cases where there is a body of historical research which could usefully be mined, but where the details of the rightsholder are unclear, the orphan works solution as proposed by Hargreaves provides the key.  Under this solution, once a work has been identified as an orphan, management of any licences associated with the work would revert to a collective management organisation, which would grant licences for DTM thus freeing up those works for analysis.  A new data mining exception would not be needed to enable this to happen.

14. Secondly, UKPMC is limited to biomedical research – and only a subset of that. Focusing on this one area fails to take into account the DTM activity in other areas of academic, professional and educational content.

15. Publishers are willing to enable mining of "Gold Open Access" material (i.e. where a publication fee has been paid), and some routinely include DTM permissions in licences for non-commercial users, such as the NESLi licence available to higher education institutions via JISC Collections, or the licence to the British Library. However, for understandable reasons, publishers are not prepared routinely to license DTM for databases deriving from Green deposit (i.e. for which no payment has been made) Since a large amount of the UKPMC repository is Green Deposit, it gives rise to the figure of 13% availability for DTM. But, if the analysis was to be conducted of permissions granted to works which had been paid for – and which have gone through the full publishing quality process – then the result would be very significantly higher.

Practical Objections

16. There are important technical reasons why a blanket exception is a flawed proposal. Were there to be unrestricted access to web-crawlers and mining software to allow data to be retrieved and copied, publisher systems would crash. (In the same way that a number of heavy users on an internet connection can degrade the service for other users, so too uncontrolled downloading and copying would massively degrade the system.) This applies equally to the platforms of the individual publishing companies or UKPMC. None would be able to cope with the level of downloading which would ensue were a copyright exception to be in place. For DTM to work well, publishers would have to invest further in complex technical upgrades and reconfigurations. But in the absence of the prospect of any economic incentives or rewards it is difficult to envisage how such investment would come about.

17. Furthermore, publisher assistance is very often required by those wishing to analyse data. In publishers’ experience, data and text miners want customised solutions from copyright holders, and a permissions or licence based solution allows and encourages this, in a way that a copyright exception would not. Nor would an exception address the main challenges to effective DTM which have been identified by experts already active in this field, such as the need to standardise formats.

18. In summary, it is highly misleading to characterise the relationship between publishers and data as being an effective "veto". Hargreaves and the Government seem intent on characterising publishers as hostile bouncers, bent on barring access to restricted areas. In actual fact, publishers play the role of the highly amenable maitre’d, guiding users in the direction they want to go and helping them use the research in the most effective way. In this role, publishers are also able to deny access to those whose intentions are not sound and who intend to use the data or text in a commercially competing use. Introducing a copyright exception would see the disappearance of this mutual relationship and would undermine the utility of the research.

Legal Considerations

19. It is widely predicted that DTM will become increasingly commonplace and part and parcel of the normal exploitation of scientific publishing, any proposed copyright exception to allow it would fall foul of the Berne Convention on Copyright, the "three step test" of which prevents any new exception which "conflicts with the normal exploitation" of a work.

20. Further, the Review is wrong to insist that "non consumptive" use should be placed outside of copyright. Such use can be seen as "machine reading" rather than human reading and to that extent it is, as Hargreaves notes, different to that which the original framing of copyright law was designed to support. However, this is not an argument for saying that copyright law should not be adapted in order that it can apply to it – copyright is routinely adapted to accommodate new technologies. Hargreaves makes no economic case whatsoever for saying that DTM technology should somehow be beyond the copyright pale.

21. A new exception could potentially lead to economic harm if it allowed a data or text-miner’s commercial use to impact upon the commercial use of the publisher. Although the exception would be crafted to disallow commercial use, challenging such use would only be possible retrospectively – and would involve expensive and time-consuming legal action. The PRC research also shows that currently 47% of publisher respondents consider requests on a case-by-case basis.  This evaluation of applications helps to protect publishers against content-miners developing research being used for commercial purposes.  This important sifting process would not happen with an exception. 

22. The competitiveness of the UK economy could potentially suffer from a DTM exception. The original PubMed Central database established in the US by the National Institutes of Health (of which UKPMC is a derivative "mirror" site) , does not routinely allow DTM activity on its service. So American publishers would not face the costs and potential losses of their British counterparts. Furthermore, a very large proportion of the scientific information used in the UK is not protected by UK copyright and so would not fall under any UK exception. This would inevitably lead to a lack of clarity as to the status of all work which would hamper the whole sector. More importantly, it would create a disincentive to publishers to publish in the UK, which would have a negative impact on economic activity.

The Way to a Better Solution

23. Publishers will work to communicate better the ease of the existing process and the high frequency with which permission is granted to relevant stakeholders. Publishers will also establish a Working Group to design a model licence for access to content for DTM purposes. DTM is an embryonic market – the development of which will be accelerated by a system of licensing that can take into account various specific requirements.

24. Work is already in hand at an international level to establish comprehensive technical standards, ontologies and rights language across the publishing industry, to enable the opportunities provided by digital technology to be fully realised.  Publishers play a key role in implementing these standards and facilitating text and data mining by investing in tagging and other semantic and knowledge discovery technologies.

25. With regards to the specific issue of enabling DTM across the full content available in UKPMC, The PA would welcome the creation of a Task Group with the Wellcome Trust, the British Library and the JISC to discuss the issues and barriers around such use of the database.

Evidence

26. The importance of economic evidence is unarguable, but we would note that the Report does not fully acknowledge the economic case for the current copyright framework and has little to say about the huge levels of investment and profitability already being derived from innovative digital products and services. Hargreaves criticises the use of "lobbynomics" rather than data from independently verified research consultants. As far as our sector is concerned, all of the data we provide to government is completely verifiable and, in many cases, generated by independent third parties. Furthermore, there is something of a deep irony to this critique from a Review which by almost common consent was inspired by the lobbying efforts of technology companies.

Copyright Licensing

27. The PA is broadly receptive to the proposal for a Digital Copyright Exchange and it accords with suggestions from ourselves and others that such automated licensing systems are feasible and potentially useful. The DCE must be a truly voluntary body, operated by the commercial sector, run on commercial lines and acting in response to clear commercial needs. There should be no restrictions imposed on companies or creative individuals who choose not to engage. Furthermore, there are a great many questions to be asked and issues to be worked through including:

· Is the broad concept for the DCE to be a registry with limited trading functionality where desired by individual rightsholders, or a "rights eBay" where everything is up for trade?

· How will the DCE integrate with existing and developing rights registries, such as ARROW?

· How will "standard" licensing terms be negotiated – and how flexible could such terms hope to be? What about rightsholders who do not wish to apply standard terms?

· What are the competition law implications for standardising licence terms?

· How will the DCE increase consumer choice?

28. The PA warmly supports efforts to reform copyright law with regard to orphan works, an area which has long been of concern for users and publishers alike. We believe that the two-step process of diligent search and licensing is appropriate – and indeed superior to the proposal in the EU’s Draft Directive which does not support licensing. We look forward to discussing further details with officials.

29. The PA requests clarity as to the full extent of the proposal to "support moves by the European Commission to establish a framework for cross border copyright licensing and extended collective licensing in specific areas. Nothing in the existing EU copyright acquis prevents multi-territorial licensing and indeed such licensing occurs where there is a demand for it. In this regard, and as a general principle, licensing terms should be dictated by the market not by governments.

30. With regards to the proposal to support extended collective licensing, again, further clarity is required as to what is being proposed here, but any proposal to expand extended collective licensing, so that mass licensing would be allowed even of rights where owners had not explicitly given permission, would run entirely counter to the normal operation of copyright and would place an intolerable regulatory burden on small rightsholders in particular.

Exceptions to Copyright

31. The PA broadly supports an exception to enable libraries to make copies for preservation and archiving purposes in ways not currently covered by exceptions. The definition of "non-commercial research" needs to be very carefully analysed to ensure that there is no potential for such an exception to conflict with international copyright law. And clearly, the exception should not be capable of being misconstrued by libraries as giving them the ability to make such archives accessible to all.

32. We do not believe a parody exception is necessary given the incredibly high levels of successful parody works which exist in the British market. The introduction of an exception would create huge uncertainty in the marketplace and would doubtless be exploited as a loophole for those engaging in other forms of unlicensed copying.

33. The format shifting exception with regards to musical works would appear to be a reasonable reform. We would oppose any extension of this proposal to literary works.

34. With regards to the proposal for a further copyright exception at EU level designed to allow new technologies which "do not directly trade on the underlying creative and expressive purpose of the work", it is difficult to imagine a recommendation which would do more to eradicate the competitive advantage in creativity which the UK enjoys. The idea that any copying which is currently unenvisaged should be deemed lawful the moment it becomes technically possible is a clear inversion of the legally recognised operation of copyright. The Review does not provide any evidence for its assertion that the absence of such an exception is blocking innovation.

35. Hargreaves proposes that copyright exceptions be protected from override by contract. This recommendation would stifle the digital economy. Contracts with rightsholders not only provide for third parties to license works but allow them to do so in ways which would otherwise be infringing copyright. Most importantly, such contracts introduce greater specificity, clarity and certainty between rightsholder and licensee, providing a firm basis on which to come to commercial agreements. Copyright law is, of necessity, governed by broad and general concepts such as "fair dealing"; contracts are useful in amplifying and codifying such broad terms. It would a mistake for legislation to curtail the ability for mutually advantageous deals to be struck between rightsholders and third parties.

36. Contracts also have to work alongside copyright where international partners are entering into territories where they may be unfamiliar with law, or attempting to have one licence covering a range of uses in a number of territories. The contract can simplify this relationship by setting out the range of uses the licensee can adopt.

Enforcement of IP Rights

37. The PA is grateful to see the importance of the implementation of the DEA acknowledged and we hope that the Hargreaves Report will give extra impetus to those efforts in a cost effective manner.

Small Firm Access to IP Advice

38. The PA agrees with the assessment that small firms need IP advice to be a part of the overall business support. The PA will seek to be firmly engaged in the IPO’s work in taking this recommendation forward and feeding in the perspectives from our independent publishing members.

An IP System Responsive to Change

39. Revision of the Copyright Act would create yet further uncertainty and disruption to the creative industries. We do not believe that the IPO should or could replace the judicial system in providing the definitive voice in the interpretation of copyright law. Whilst clarification statements may be welcome and appropriate from time to time, in matters of copyright and contract rightsholders will always seek to take their ultimate guidance from the courts

Other Recommendations

40. The PA has no comment with regards to recommendations on a unified EU patent court, patent thickets, or the design industry.

41. The PA would welcome the opportunity to provide the Committee with further evidence, either in written or oral form.

9 September 2011