Dear reader

Happy New Year! I hope that the weight of your 'Inbox' hasn't made entry into 2012 too painful.

It's one of life's little ironies that the Chairman of the UK Pirate Party (aka Loz Kaye) and I share exactly the same name. Name sharing v. file sharing!

Olivia Solon of 'Wired' magazine recently interviewed Loz and me on a range of digital media law issues. You can find the piece published today in 'Wired' here.

Although we disagreed a quite a few issues (e.g. Digital Economy Act), we also had a lot in common, especially our recognition of the role that the creative industries can play in getting UK plc out of the current economic mess.

I hope you enjoy the read. If you want any more detail on any of the points discussed, just let me know.

Have a good week.

Laurie Kaye

Dear reader

"New business models", "responding to customer needs", "DRM", "Outsourcing" - not phrases from yesterday's very stimulating #FutureBook Conference. I talked about them in my presentation at 'e-Pub@ London Book Fair' in March 2004. But although change may not rapid, it is definitely happening now - that was the clear impression from yesterday's conference which was full of creative thinking.

So here are my 10 key takeaways' from the FutureBook conference, most of which stem from the fact that for trade publishers in the digital world, the customer is the reader, not the retailer. When reading, bear in mind that a lot of this focuses on trade publishing and the shift from 'B2B' to 'B2C'. That said, many of the points apply to other sectors of publishing industry.

1.  The key question for publishers to ask themselves is: "How can we be of most value and use in the conversation between writers and readers?" (Stephen Page, ceo., Faber and Faber @stephenpub).
2. Publishers need to focus on building brands, with multiple products across every platform. (Charlie Redmayne, c.e.o., Pottermore). (Sounds more like the entertainment business than publishing? You bet it does!).
3. 'One size fits all pricing' is dead. (Nicholas Lovell, founder, Games Brief @nicholaslovell).
4. Whilst the big online distributors build vertical distribution models - cloud storage >  device > purchase and payment - it's still the publishers move - content is king. (But don't hang around too long to figure out the move!).
5. As we transition from print to digital + print, we are caught between the print world of territoriality and the online world where world language rights will be the norm. Managing that transition effectively - and perhaps treating print and digital differently - is essential.
6. As the next three points show, understanding the relationship and interaction between technology and content is key to the future of publishing....
7. Google's change to its search ranking algorithm - 'Panda' - reduces the importance of in-bound links and increases that of site content. So, once again, 'Content is King'.
8. For the right market (e.g. education), creating a developer ecosystem by allowing developers access via API to a publisher's content is the way to build the market. (That was illustrated by Diana Stepner, head of future technologies, Pearson - @dianas).
9. Publishing online requires an agile and iterative approach to product development, based on user needs. (Sounds like the software industry? You bet it does!).
10. That leads to another point - we have to accept that the price for innovation is accepting failure (but not to repeat the same mistakes!).

In my next post, I'll reflect on how this all impacts from the legal angle.

Have a good week

Laurie Kaye

Dear reader

 Hot off the press is news about the Richard Hooper's appointment by Business Secretary Vince Cable yesterday announced the appointment of Richard Hooper to lead a feasibility study on developing a Digital Copyright Exchange (DCE) in the UK: http://nds.coi.gov.uk/content/Detail.aspx?ReleaseID=422173&NewsAreaID=2  

 Whilst a feasibility study is not, of itself, going to unleash the potential for the market for trading in rights in digital content, it's a step in the right direction. But let's remember that there are already rights exchanges developing in the audio-visual, publishing and other creative industry sectors. In my view, what we are missing is the 'glue' or links to make them all speak to each other to allow rights trading on a machine to machine basis.

I also think one of the really interesting areas is how public/private partnerships could develop to facilitate increased access to digital content by libraries, museums and other public bodies and by commercial providers of digital content services.

Anyway, here's the announcement about Richard Hooper's announcement as summarised by the IPO:

"A DCE has the potential to boost economic growth in the creative sector by lowering the costs of licensing and giving businesses and consumers easier access to copyrighted material. The recommendation to create a DCE was put forward by Professor Ian Hargreaves in his report; Digital Opportunity: A Review of Intellectual Property and Growth. The review suggested that an exchange has the potential to grow the UK economy by over £2 billion.

Richard Hooper said: "There are people all across the creative sector trying to develop ways of licensing works using new digital technologies. We need to bring that enthusiasm and talent together to create a universal system that benefits everyone. This work is about helping the industry to do more, to do it quicker and grow the economy.

“My work will be in two distinct phases. First I want to talk to people across and outside the sector to find out how they see the licensing challenges facing them.  As part of that process, I'll be looking to meet the key players and to provide opportunities for all those interested to air their views. We will then be able to forge some common understanding so that I can look to produce appropriate industry-led solutions which respond to the spirit of Hargreaves’ vision.”

Interested in following Hargreaves Implementation? Subscribe to updates at http://www.ipo.gov.uk/types/ipreview-whatsnew-rss.xml"

Have a good week (and weekend)

Laurie Kaye

Dear reader

Here's a report really worth reading, produced by ENISA (European Network & Information Security Agency) on helping to protect against the risks of cyber-bullying and online grooming, featuring a scenario on data mining / profiling of data available on the Internet.

Download ENISA Report - Cyberbullying_v3 31

Have a good weekend. I'll be at the Society of Young Publisher's Annual Conference, speaking with Lynette Owen, copyright Director of Pearson Education, on 'The Changing World of Rights".

Thought for the weekend: "11:11:11" is a palindrome which occurs once every 100 years. Is this the day for taking big decisions?

Regards

Laurie Kaye

Dear Reader

Usually, I like to comment and analyse things digital, but thanks to my good friends at DeHavilland political intelligence services , I'm doing a spot of reporting. I've reproduced the DeHavilland Report on the evidence given by Prof Sir Robin Jacob to the Business, Innovation and Skills Commmittee on the Hargreaves Review on Tuesday. It makes really interesting reading and supports the view that wholesale changes in UK IP law is neither necessary nor likely. 

You'll quickly get the flavour of Prof Jacobs' views, and he's an influential figure.

Laurie Kaye

"Overview

The Hargreaves Review had been far too general, and had been given too large a remit in too small a timeframe, MPs heard today.

Prof Sir Robin Jacob, currently Sir Hugh Laddie Chair of Intellectual Property Law at UCL and before that an Appeals Court Judge, said that “it is not possible to do the whole of IP in six months”.

Giving evidence to the Business, Innovation and Skills Select Committee, he called for an 18 month study of the specific issue of online copyright.

Furthermore, he said that conclusive studies were not possible without draft legislation.

On enforcing online copyright, he said that he wanted a detailed understanding of whether technical steps from ISPs were possible before decisions were taken on the best approach.

However, he said that he felt that the only way to protect music, film and book rights online would be for steps to be taken within ISPs.

Copyright law was best enforced within civil proceedings, not as part of the criminal justice system, he said. Sir Robin did not believe that the police were good at working on this, and that the speedier civil courts were more effective.

Although not opposed in principle to a Digital Rights Exchange, he said that this would only work at an EU level.

Even then, he believed that altering the arrangements for injunctions and thus passing more cases to the Copyright Tribunal was a better solution.

On orphan works, he again felt that copyright tribunals were the best system, allowing a small fee to be paid if rights holders identified themselves.

Sir Robin strongly supported an exemption to copyright laws to allow data mining, stressing that he had spoken to medical researchers at UCL who said medical advances were being stopped by the lack of this facility.

Summary

Prof Sir Robin Jacob was a barrister at what was then known as the Patent Bar (now known as the IP Bar), and until last year sat as a judge on the Court of the Appeal.

He now teaches at UCL. Sir Robin stressed the international nature of his work on IP, noting that only a minority of his students came from the UK.

Opening the session, the chair of the committee, Labour MP Adrian Bailey asked for the witness’ general perspective on the issue of Intellectual Property.

Replying, Sir Robin said that “many of the problems which are said to be new are not new at all”, and had in fact been around for centuries.

One example of this, he said, was ‘patent thickets’ (of which the Hargreaves Review had said they “obstruct entry to some markets and so impede innovation”).

Assessment of the Hargreaves Report

Asked what he thought of the Hargreaves report, Sir Robin said that he was “astonished” when it was announced, given that there had been a similar report just two years earlier.

The current trend, he said, was for Government and “non-lawyers” to view intellectual property as one single issue.

He argued that there were in fact a range of laws addressing “quite different sorts of things”.

It was “not possible”, he said, “to do the whole of IP in six months”.

Though he thought that Hargreaves had done a “pretty good job” in the circumstances, he complained that the discussion had been “fairly general”, with too little investigation into specific details.

There was a need, he argued, for a serious review of what could be done to address the breakdown of copyright on the internet.

Patents were now a “purely European question”, he said, on which the UK had “almost no room for manoeuvre”. The same applied to trademarks, he added (despite his own reservations about the direction of trademark policy within the EU).

However, he said that the problem of internet and copyright – though a worldwide problem – was something the UK could consider.

Later, Conservative MP Brian Binley said that it seemed to him like “Hargreaves wrote the report the Government wanted”, and therefore wondered if the problem was in fact the terms of reference.

Though he said that he had not read the terms of reference, Sir Robin said that he thought that IP should not be considered as a whole and could not be considered within six months.

Online copyright

Sir Robin suggested that the ISPs and other people involved in money transactions, including banks and credit card companies, might be targeted for their role in the sale of counterfeited goods.

This should be looked at, he said, although he stressed that he was not calling for these organisations to be targeted before a detailed investigation.

Copyright had always been a response to technology, he said. It always addressed problems after they had initially arisen, he stressed.

Hargreaves had considered trying to make copyright law future-proof, he noted.

Mr Jacob said that he did not “really understand” what was being floated in that section of the report, and felt that a general rule that allowed courts to assess fair use would be “fairly rough and ready”.

One of the problems in copyright was that it was too powerful, he said. There ought to be cases, he argued, where the answer was “a small amount of money changing hands”, rather than an injunction being issued.

If copyright was too powerful (in either direction), it was bad for the economy, he said.

He said that the French adopted a more restrictive example of copyright, because they tended to see creative works as an extension of a personality.

In the UK and the US, he explained, copyright was seen primarily as an economic tool to encourage the publication of works.

Conservative MP Brian Binley referred to a paragraph in the Hargreaves Report which suggested that there was not a difference between a printed work being lent and recorded works being shared online. He wondered if digital recordings and books should be placed together in this way.

Mr Jacob said that online file-sharing was not in any way comparable to lending someone a printed book, because it involved making a copy. He agreed with Mr Binley that this section of the report was odd.

Later on, asked how copyright law should be changed to incorporate the digital environment, Sir Robin repeated what he had said earlier. He said that it needed to be looked at in much greater detail.

He felt that there was a technical question about what was physically possible.

“This is something that really ought to be looked at not from the point of view of a general study, but from specific proposals and draft legislation”, he said. “Doing it too generally is not helping anybody”.

Asked by Labour MP Paul Blomfield what his approach would be, he said that he would look to review the Copyright Act with a particular emphasis on changing the law specifically for the internet.

He said that he would expect anyone conducting this exercise to actually draft the changes in advance.

More information was needed about the technical abilities of the internet service providers, he said. “If you can’t do, there’s not much point passing a law”, he said.

He felt that measures within ISPs were just about the only way you would be able to protect sound recordings, films and books.

Asked what progress could be made at a national level, Sir Robin said that there was “not all that much”.

Pressed on whether there should be a wholesale revision of the 1988 Copyright Act, Sir Robin said that there should be.

He said that a “tough chairman - I have someone in mind but I won’t name them now – should be put in place and given time from his current job”. He said that he felt such a review should last 18 months.

The problem with the Hargreaves Review, he said again, was that it was too general and did not look at specific activities he wanted to stop or encourage.

Policy making process

Replying to Conservative MP Nadhim Zahawi, Sir Robin said that the Hargreaves Report’s statement that IP was falling behind was wrong. He said that there was no evidence at all that patents or trademarks were falling behind.

He said that the area that needed to be looked at was copyright on the internet, where issues such as enforcement, format shifting and international rights needed to be considered in more detail.

Mr Zahawi then asked what the challenges were for establishing evidence-based policy.

Replying, Sir Robin said that he was “not entirely sure what evidence is” in this context.

He said that “some amazing numbers” were in the Hargreaves Review and the Government response. He said that he did not believe that there were “any reliable numbers in any of those”.

Responding to this, Mr Zahawi stressed that Prof Hargreaves had identified this as a problem, having referred to “lobby-nomics” and a lack of reliable peer reviewed evidence from interest groups.

He referred to reforms to trademarks in the past where numerical predictions had proven entirely unfounded.

“Some of the law on intellectual property is done by gut instinct or gut feeling”, he said. He said that Silicon Valley grew up in the US without anyone enforcing any patents.

Sir Robin said that he could not distinguish any reliable evidence in the lobbying by interest groups within this area.

Need for criminal legislation

Mr Zahawi asked if the Government should look at criminal legislation rather than civil legislation, given the scope of the digital platform that allowed for copyright infringement.

Replying, Sir Robin said that some copyright law was already criminal. However, he said that the police were not good at investigating copyright.

“I’m not in favour of criminal prosecutions at all”, he said. He noted that there had been consideration of criminalising patent law in Spain, but stressed that the UK had done this since the 1700s.

Making this issue criminal “wouldn’t achieve anything useful”, he said.

Sir Robin said that the civil courts were powerful, because the owners of copyright were best placed to identify counterfeits and because these courts moved much more quickly.

Digital Copyright Exchange

Conservative MP Margot James asked about the large volume of archive material, such as that owned by the BBC and the British Museum, which could not be used because the owners could not be identified.

Replying, Sir Robin said that he doubted the Hargreaves proposals would allow any significant change.

He said that turning copyright into a registration system was contrary to the fundamental principles of the Berne Convention for the Protection of Literary and Artistic Works.

However, he felt that Hargreaves had not considered a potential middle ground where content could be used, but that a payment should be made.

Sir Robin said that he understood the BBC’s worry that someone would “come along with an injunction and mess up their archives”.

Courts needed to the power to resist an injunction and instead pass the matter to a copyright tribunal, who would decide on a fee, he argued. He expected this fee to be very small in most cases.

“I don’t think people should be able to abandon copyrights and then resurface years and years later”, he said. He saw the 70 years after death copyright rule as being “ridiculous”.

Ms James then asked about the idea of having different legal remedies depending on whether the work is registered.

Sir Robin said that he had not looked into the fine details of this, but that it was a “reasonable hypothesis” to say this would be very complicated.

He said that the European law would make this very complicated, because of the alternative approach taken in France.

Therefore, he said that this proposal needed to be examined in much more detail.

Asked if this was as important a policy priority as European Financial Services, Sir Robin said that he would not “put it in the same box” as that.

But, he wanted the EU to “get its act together”. He had particular concerns about the application of trademark litigation at an EU level, which had been a “bonanza for lawyers”.

Asked if the DCE would alter the legal landscape positively by clarifying legal rights earlier, Sir Robin said that “I can’t say that it would”.

He emphasised how many creative works contained a number of different rights, such as sound copyright, production copyright, writing copyrights and film copyrights.

Asked if the UK should develop this independently from the rest of Europe, Sir Robin said “no”.

He said he doubted that a “UK specific” system would be “useful to industry”. A European Rights Exchange would be better, he said.

But, he said that his earlier proposal of creating an intermediary for injunctions would be much more powerful.

Mr Javid said that the Premier League were very concerned about the implications of an all encompassing exchange, because they had generated great value selling rights around the world.

This depended on what the exchange was intended for, he said. If it was merely to make the owners of copyright easier to locate, then it would not be problem, he said.

He said that he did not think that Hargreaves was proposing any kind of requirement for license, and suggested that the Premier League did not need to be concerned by the Hargreaves proposals.

On the specific issue of Greek decoder cards, Mr Hargreaves said that there were options, such as charging the Greeks more.

He said that a bigger problem was Albania, where cards came into the UK from outside the EU. He also felt that a technical development would soon mean a code was needed instead of a card.

Asked what the Government should do, Sir Robin said that this related to the broader question was the extent to which the EU should act as a driver towards a common market.

Orphan Works

Conservative MP Rebecca Harris then asked what Sir Robin thought the proposals on orphan works were, and if they would work legally.

Sir Robin said that his report had been so general he could not understand what the specific proposals were.

He said that what he would propose was a law that required a “reasonable search”, and then if the owner ever emerges, a reasonable amount of compensation can be claimed “which won’t be a lot of money”.

He believed that the level of search required should be determined by what use was intended. He said that people organising a village fete should not be obliged to make as extensive a search as someone wanting to publish it into a national newspaper.

Pressed further on secondary use where a newspaper used something they’d picked up at a village fete, Sir Robin said that the newspaper would have to pay more, as determined by the copyright tribunal.

At present, he said that some people “took a chance” and published things that might be challenged.

The problem, he said, were the people who did not “take a chance”.

He said that if the BBC did release it archives, he expected 99.9% of the works released not to be challenged. However, he also accepted that the BBC was not in a position to break copyright on a large scale.

Asked if an orphan work became a bestseller, he said that in that circumstance the author should get a “reasonably large amount of money”, but he did not think laws should be made for these “one off” cases. These should be settled at the Copyright Tribunal.

The Hargreaves Review had not considered the work of the Copyright Tribunal in enough detail, he said.

On moral rights, Sir Robin said that he had not seen what proposals anyone had made to strengthen these arrangements.

Asked about the draft EU directive on orphan works, he said that it was “too modest” and “doesn’t really solve the problem”.

“A lot of the EU stuff isn’t terribly well thought through on intellectual property”, he said.

The most important thing was to make the system as “simple as possible”. “This subject has got far too complex in my lifetime”, he said.

In particular, he singled out the EU Database Directive as far too complicated.

Design rights and patents

Sir Robin then gave a detailed explanation of how design rights worked, and said that “nobody in their right mind would have such a complicated system”.

He estimated that seven different systems applied overall.

But, he said that nobody knew how much this actually affected designers. He said that he would remove the British system and rely on European law, but he did not know whether the system either helped or hindered designers.

He wanted those involved in the law to assess more carefully what commercial problems were faced, because he did not think it was worth changing a system simply because it was untidy.

Content Mining

Asked by Mr Binley about an exception for content mining, Sir Robin said that he had discussed this with colleagues in his university.

It was “a matter of huge concern” that the law was perceived to be getting in the way of important medical work, he said.

He wanted an exception, because he did not think the content affected would have much value. He said much of this content should be “basically free”.

Patent law

Asked about patents, Sir Robin said that the current law was set by the European Patent Convention, which included 38 European members.

He wanted this system to be sorted out at a European level, and hoped that the UK would address this.

It was “untidy” that the rulings from the European Patent Convention were passed in Munich, but were then litigated at a national level, he said.

However, he said that the proposal to establish a super-national court for patents were very concerning, especially as they were being rushed through and could happen within a year. He said that he agreed with those in British industry who had lined up in opposition to this.

He did not think this would achieve its intended outcome of establishing a uniform system across Europe.

On patent thickets, Sir Robin said that he did not see how this could be avoided. He said that patentees would naturally seek as much protection as they could get with their innovations.

Patent compliance was “hugely expensive”, he said, and he suggested that time limits might be changed to make this less complicated.

However, he said that he not seen any evidence of little companies being taken advantage of by little companies, and argued that the patent system was broadly working well.

“Nobody can afford to ignore somebody else’s IP rights”, he said.

However, he said that there was a problem with the cost of patent litigation, which had existed for many years. He argued that cases involving two “little guys” should be resolved more quickly, even if this meant “slightly rougher justice”.

Replying to a further question from Labour MP Katy Clark on patent courts, Sir Robin said that the biggest problems came when big companies came up against smaller companies, saying that “the little guys are more likely to get it wrong”.

He said that the work on patents at a county court level was “pretty good at the moment”.

One problem was that the “patents court was quite vexed by some ludicrous claims”, he said.

Asked how British patent lawyers helped British businesses, Sir Robin said that he thought there was very good advice available from this part of the legal profession. He said that his only complaints were that they did not take enough students on and were not large enough.

He saw no potential for establishing a lower cost advice centre. “It’s just not going to happen”, he remarked.

Independent advice on IP law

The application of IP law was too complicated to allow for low cost advisors, he said, especially if they were also to offer business advice. He saw this as one of the most impractical parts of the Hargreaves proposals.

“Is it realistic to expect competing IP practitioners to provide buddying and mentoring services”, asked Mr Bailey.

Sir Robin said that he did not think it would be.

Collecting societies

Finally, asked if there was anything that the committee had not asked about but which he thought was important, Sir Robin referred to “collecting societies”, such as the PRS and the MPCS, where the administration of rights was assigned to a particular society.

He said that different societies charged different rates for different things, and felt that this was complicated and often poorly understood.

He saw the differences between the UK system and that in countries like France as “not making much sense within a modern European Union”.

Though he did not expect the committee to propose any changes at this stage, he hoped they would recommend an investigation into this."