The perils of a "use now, pay later" approach to intellectual property

Andy Williams, Managing Director of ITN’s licensing arm, makes his argument for a robust and fair copyright framework.

This article is a reponse to Benjamin White's piece "Copyright for a digital age", which recently appeared on the New Statesman blog.

It’s hard to get excited about copyright but the argument of what constitutes fairness in copyright and how intellectual property law can stimulate the economy is now the subject of Parliamentary and industry debate concerning controversial measures in the Enterprise & Regulatory Reform Bill and an impending announcement from the Intellectual Property Office (IPO).

On one side, rights holders like ITN are deeply concerned about the proposed dismantling of a robust intellectual framework that underpins significant investment in content creation and preservation. Meanwhile public bodies such as the British Library - whose Benjamin White recently voiced his opinions for the New Statesman - and companies that want "free" use of others’ intellectual property view copyright as a cumbersome and outdated regulation. Whichever side of the fence you’re on, the impact of the decisions made in coming months by Parliament, the Government and the IPO will be enormous.  

A relaxation of copyright law may help the British Library cut down on the time it takes to clear rights and digitise its materials, but the extent of the radical proposals on the table for usage of orphan works, introduction of new and wider exceptions for "free" usage of copyright material, and a scheme for Extended Collective Licensing will go much further than just helping public sector institutions to better serve researchers. The very same measures could stifle actual creation of content in the medium to long term, devastate vast swathes of the creative industries - which employ two million people and contribute 6 per cent to GDP - and permit those who don’t invest in UK original content to freely benefit from others’ work.

The creative industries rely on a business model underpinned by a fair and robust copyright framework to discourage and legislate against illegal use. There are quite rightly instances that allow for free use of copyright material – for example an exception to copyright for news reporting is vital to freedom of speech and expression; but the IPO has proposed that a wide range of free usage could be introduced in instances of parody, education and a particularly grey area of "quotations". The policy statement confirming which additional exceptions they plan to implement is due before the end of the year. However, in calling for a lowering of the barrier for free usage of intellectual property, technology companies, public bodies and consumer groups may well find that if they get their wish then the content they want to use freely rather than pay a licence for will simply dry up or not be digitised for mass usage. It’s a commercial reality that if there isn’t a financial incentive then investment in content creation and preservation will suffer.

In addition, proposals for Extended Collective Licensing may seem attractive in offering a time-saving rights clearance mechanism for the British Library, but the opt-out nature of the scheme and scant detail could lead to organisations springing up to license others’ content on their behalf without their knowledge and consent. There are fears about lack of transparency, inappropriate use of sensitive material, undercutting of prices and what US photography groups describe as a “firestorm of international litigation”. It’s bizarre that this is seen as necessary when a Copyright Hub is being developed by Richard Hooper and companies are already investing millions to digitise content and put it online to make it easy to find and be licensed.  

There are, however, potential benefits to establishing a way to license orphan works – whether through UK legislation or implementing a recent EU Directive - as this could free up content that would otherwise lay dormant; but the system must protect creators’ rights by having appropriate safeguards such as clear rules on what constitutes a diligent search to find the owner of a particular piece of intellectual property. A "use now, pay later" approach as advocated by Benjamin White concerns me greatly as less scrupulous organisations could see an orphan works system as a means simply to avoid paying for a licence.

It’s also worth thinking back to the origination of all of these proposals – the Hargreaves Review, which hailed evidence-based recommendations that such measures could help grow the economy by £5.5bn per annum. ITN, along with many of the other 471 respondents to the subsequent IPO Consultation on Copyright, has helped to show that this projection simply doesn’t stack up. Rather, unpicking our copyright regime will take money out of the UK economy as inward and domestic investment and syndication of original content is stalled or cancelled.

The risk becomes even more urgent when you consider that the copyright measures as currently drafted in the Enterprise & Regulatory Reform Bill before the House of Lords would enable much of this sea-change to happen by secondary legislation. Whether in favour of a change in copyright law or against it, no one should want fundamental alterations to be made without full parliamentary scrutiny and debate when there is so much at stake for public bodies and the commercial sector alike.

Andy Williams is Managing Director of ITN’s licensing arm ITN Source

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Putin's vote-winning trick? He makes power personal

Representatives in the Russian parliament, the Duma, have long been unpopular. Yet President Putin is immune to voter's discontent.

A week before Russia’s parliamentary elections, the central square in Ekaterinburg – the fourth-largest city in Russia, a thousand miles east of Moscow – was packed with people, huddling close on a wet September night. They faced a stage decorated with a poster imploring the crowd to vote for “ours”, meaning United Russia, Vladimir Putin’s political party.

Yet it wasn’t politics for which thousands of people had braved the rain – it was music. During the perestroika and glasnost years of post-Soviet openness, Ekaterinburg was the cradle of the Russian rock scene. The home-grown bands Nautilus Pompilius, Chaif and Agata Kristi sang about freedom and change. Thus, this free concert to celebrate the 30th anniversary of the legendary Sverdlovsk Rock Club was bound to draw a crowd, and United Russia latched on to that.

A message from Dmitry Medvedev, the United Russia leader, praising local rock bands for their bravery “in those days when freedom was in deficit”, was read to the assembled fans. If freedom was a powerful word thirty years ago it has little impact on Russians today. Turnout in the election on 18 September was less than 50 per cent (and only 41.5 per cent in the Ekaterinburg region), a sign of the general political apathy. Before they went to the polls, it was hard to find anyone who was enthusiastic about voting.

“Why should I bother with voting? The result is clear: United Russia will, as always, win,” says Vyacheslav Bakhtin, who owns a small construction company in Ekaterinburg. He added: “Elections are the last thing on my mind. My business has been suffering for the last two years. We couldn’t even afford to go on a family vacation this summer.”

The Russian economy is struggling because of low oil prices, trade embargoes and geopolitical concerns. There have been public spending cuts, and the free float of the rouble led to currency devaluation and high inflation (7 per cent in August). Unemployment is rising and the base interest rate is 10.5 per cent.

There are many reasons for Russians to want a change in government, yet it appears that people do not see the link between their daily struggles and Putin’s policies.

Anna Mikhailova has recently returned from a tour of the Golden Ring of Russia (a circuit of medieval cities to the north-east of Moscow), where there is a stark contrast between the restored onion-domed churches and the crumbling villages.

“People live in poverty in crammed kummunalki [Soviet-style communal flats with several families sharing one kitchen and bathroom],” she tells me. “But they still talk about Putin the Saviour, standing up for Mother Russia.”

Apart from United Russia, 13 parties were judged eligible to stand, but the range of choice was an illusion. Olga, who requested anonymity for her own safety, explained. “We have one party – United Russia – a few pseudo-opposition parties, the Communists, the LDPR and Fair Russia who support Putin’s cause, and a bunch of nobodies that people don’t care about.”

Indeed, Gennady Zyuganov, who has led the Communist Party since 1993, campaigned under the slogan “Ten Stalinist punches against capitalism”. But although he criticised Medvedev, he didn’t touch Putin. The populist leader of the Liberal Democratic Party of Russia (LDPR), Vladimir Zhirinovsky, another political dinosaur, actively endorses Putin’s foreign policy.

If there is discontent among voters, Putin is immune to it. On the eve of the elections, United Russia’s popularity slid to just 30 per cent of total respondents in one poll, though it scored 50 per cent among those who said they were definitely going to vote. Medvedev’s own approval rating fell to 48 per cent. His message to the elderly that state pensions wouldn’t increase, and his advice to teachers to get jobs in the private sector if they weren’t happy with their state salaries, might have had something to do with it. Yet Putin’s popularity remained consistently high, at 82 per cent, according to independent pollsters the Levada Centre.

Alexey Volkov, a 40-year-old business manager, says he voted for the Communists. “I voted against United Russia, the apparatchiks stifling the president,” he explains. “Putin, on the other hand, is the best ruler since Alexander III [Russia’s emperor at the end of the 19th century].”

Representatives in the Russian parliament, the Duma, have long been unpopular and considered ineffective by the Russian people. Over the past 16 years, presidential power has expanded hugely. Since Russia adopted its new constitution in 1993, successive presidents have introduced legislation to stretch the office’s authority. In his first term as president, Putin acquired 219 new rights and duties, and as his successor Medvedev enjoyed an additional 114 responsibilities. These range from educational appointments to federal government decisions.

As predicted, United Russia topped the ballot with 54 per cent of the vote. Putin’s party claimed 343 of the 450 seats (up from 238 in 2011). The same four parties will form the Duma. The Yabloko and PARNAS parties, seen by voters as a token gesture of protest against the Kremlin, gained negligible support, with 2 per cent and 0.7 per cent, respectively.

It is ultimately Putin’s victory. In the eyes of the majority, he has restored Russia’s strength abroad, revived the defence industry and army, and reinvigorated the country with patriotism. The latter was accomplished via manipulation of the media, which has reinstated the West as the enemy and focused attention on foreign affairs at the expense of the social and economic agenda at home.

Still, with the low turnout, only 26 per cent of eligible Russians voted for Putin’s party. Though that was enough to tighten the president’s grip on the Duma, nationwide the elections paint a picture of a dejected Russia just beginning to feel discontent with the status quo. It is not yet enough to unseat Putin, but as the old Russian saying goes: a drop of water can cut through stone.

This article first appeared in the 22 September 2016 issue of the New Statesman, The New Times