[Posted by Mark Mulligan]
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Tuesday’s Digital Britain report covers a lot of ground and
I’ll leave it to my colleagues to cover much of it, but I’ll focus here on the
parts which refer most directly to the music industry.
The interim draft was a master class in nuanced,
caveat-drenched civil servant speak that carefully avoided making a definitive
call in any one direction. The final
report thankfully takes a more direct approach but many music industry
executives will feel that the tone is struck firmly in the favour of the ISPs.
The report starts off with reaffirmation of the interim
report’s assertions that the current digital market place is struggling and
needs a framework of support to protect and uphold Intellectual Property (IP)
in the digital domain, stating:
“The
content industry faces a significant challenge. At its heart the current model
is not working.”
And goes onto recognize the difficulty of monetizing
consumption and the need:
“to turn a strong user base into hard currency.”
It even takes a very strong line on IP violation:
“The Government believes piracy of
intellectual property for profit is theft and will be pursued as such through
the criminal law.”
Though
this statement will find support in areas of the content industries I think it
is problematic. The rights owners own
the right to monetize the content, and when they sell that content to consumers
they are actually selling them a license to use a copy of that content within
predefined terms. So the product is
technically the license and any physical packaging. When people download tracks illegally they
are infringing copyright and terms of original license, and they are impeding
the copyright owner’s legal right to exploit those works. But they’re not stealing. But that is a
technical aside.
Then
the report restates a previously bold commitment:
“…addressing
this problem [digital piracy]….needs to result in a reduction of the order of
70-80% in the incidence of unlawful file sharing.”
That’s
an ambitious target and one that requires equally ambitious measures. Indeed the report even goes on to talk about
a ‘Graduated Response’. But just as
music industry readers started to get their hopes up the ground beneath their
feet is progressively chipped away.
The term ‘Graduated Response’ has become the industry
language for the ‘Three Strikes and You’re Out’ pioneered in the troubled
French ‘Hadopi’ bill, that provides for termination of Internet accounts of
repeat file sharers. As the then Culture
Secretary Andy Burnham made clear at a music conference a couple of weeks ago, ‘Graduated
Responses’ were off the agenda, because broadband access was considered to be a
basic consumer right. What the Digital
Britain report has somewhat disingenuously done is appropriate the term for
their own solutions that explicitly do not include terminations. So the music industry is shorn of its more
media-friendly term and left with the much more emotive ‘Three Strikes’
label. An accident of language in the
report? Not in the slightest.
Andy
Burnham also stated his preference for ‘technical solutions’ over the
‘unworkable’ ‘Graduated Response’ approach (that’s the old Graduated Response,
not the new one by the way.
Confused? Mission accomplished by Digital Britain me
thinks). What we have in the Digital
Britain is the provision of a series of ‘Technical Measures’ as indicated by
Mr. Burnham. He even suggested Ofcom – the regulator – would be empowered to
compel ISPs to use such measures and that is exactly what is suggested here,
with a vast array of specific measures including:
“Blocking
(Site, IP,URL), Protocol blocking, Port blocking, Bandwidth capping (capping
the speed of a subscriber’s Internet connection and/or capping the volume of
data traffic Bandwidth shaping (limiting the speed of a subscriber’s access to
selected protocols/services and/or capping the volume of data to selected
protocols/services); Content identification and filtering– or a combination of
these measures.”
This is stern and comprehensive stuff that should result in
a significantly poorer end user file sharing experience and will make
downloading larger files such as movies a painful process. So why, you may ask, would the music
companies be so discontent, given that they have at least got these firm
measures? The answer lies in the work
flow of the report’s own ‘Graduated Response’.
All of these measures are “backstop
powers” that Ofcom, can use only as a last resort:
“Initially for Ofcom to have a duty to secure
a significant reduction in unlawful file sharing by imposing two specific
obligations: notification of unlawful activity and, for repeat-infringers, a
court-based process of identity release and civil action. “
So labels will still have to resort to court
action to get details of infringers from ISPs (an affirmation of the status quo
which the ISPs had lobbied for) and no proactive responsibility on behalf of
the ISPs to assist in the policing. And even then, when they have been to the
courts to get the details they simply get the right to send a letter to the
infringers to request them to desist.
Stern stuff eh?
The ‘backstop powers’ only come into effect
if
“…[these] main obligations have been
reasonably tried but, against expectations, shown not to have worked within a
reasonable but also reasonably brisk period.”
Throughout
the government-brokered Memorandum of Understanding (MOU) discussions leading
up to this report, the ISPs have consistently argued their inability to tackle
individual file sharers. Whilst the
music companies believe that ISPs can use their Deep-Packet Inspection (DPI)
technology the ISPs argue that this is designed for network level action, not
subscriber level. The Digital Britain
‘Graduated Response’ effectively forestalls testing these issues for the
indefinite future.
But,
you may ask, didn’t the report previously state it wanted to cut digital piracy
by 70- 80%? Indeed. So how does it
intend to square the circle of hugely ambitious targets with ineffective
measures? The answer is by fudging the
way the problem will be measured, relying upon measuring within the base of
file sharers that are sent repeat letters.
Remember these are simply the ones that the labels have been able to
proactively identify and then, after resorting to the courts, got the contact
details of and sent letters to. So a
very small subset of a much larger installed base. In the increasingly familiar masterful use of
civil servant speak the remit of measurement is narrowed even further:
“Proportionate
Notification Response trigger that we propose, should be focused on measuring
the efficacy of the scheme involving a notification procedure, legal action and
other measures as set out above in relation to achieving the 70% target for
reduction in unlawful sharing. We therefore believe that the trigger should be
calculated by (a) taking the number of unique individuals notified and (b)
assessing what percentage of those notified have stopped unlawful file sharing,
either voluntarily or due to prosecution. If that percentage does not exceed or
is not significantly close to 70% the mechanism will be triggered (As an
illustration: if the baseline unlawful peer to peer universe identified by
Ofcom was 100, and notifications were sent to 50% of that universe with
prosecutions against serial repeat offenders, the benchmark would be met if
there was a 35% reduction in unlawful file-sharing i.e. 70% of 50%).”
So
not only is the 70-80% just talking about testing a small subset, it's defining
some very specific and, at best, arguable parameters, using an enforcement
methodology (i.e. letter sending) that is at best unproven. In short, the
report authors have given themselves a back door exit from their prior
commitment to reducing file sharing by 70-80%.
It won’t need to mean reducing the installed base of UK music file
sharers by the best part of 6 million, but instead be a semi-hypothetical
sample based measure. This is a shame,
and smacks of backing away from the issue.
The interesting post-script to all of this is that Universal
Music on Monday announced a ground break unlimited MP3 service with major UK
ISP Virgin Media (see my post here for more details). What makes it so relevant to the debate is
that Virgin - in return for the holy grail of digital music licenses – agreed
to implement their own voluntary Graduated Response solution. Though there are significant caveats (e.g. no
permanent disconnection, no use of DPI for enforcement) it sends a very clear
message from Universal to the UK
government: if you won’t give us what we want via legislation we’ll achieve it
via commercial solutions. Which is
actually the best bet all round and exactly what Andy Burnham advised when
saying
“Sort out the problems yourselves, don’t wait for the heavy
hand of legislation”.
Indeed the experience of the troubled French Hadopi bill
illustrates that relying upon the legislative and judicial systems to help you
meet your commercial ends can be a risky business.
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