Graduated response initiatives in Europe. An analysis of initiatives and stakeholder discourses. Trisha Meyer (IBBT-SMIT)1 Leo Van Audenhove (IBBT-SMIT) Luciano Morganti (IBBT-SMIT) Abstract In France the government, the content sector and ISPs reached an agreement on an initiative to curb online copyright infringement on the Net in the so-called Olivennes Memorandum of Understanding of 23 November 2007. According to the MoU Internet users infringing on copyright laws receive two warnings of their illegal behaviour before being disconnected from the Internet. Other countries such as the UK and Italy are considering similar approaches. The graduated response initiatives have been hotly debated throughout Europe, both at the national and European level. In January 2008 the European Commission adopted a Communication on Creative Content Online (CCO),2 which aimed at launching actions to support the development of innovative business models and the deployment of cross-border delivery of diverse online creative content services. The first step is a stakeholder consultation on 11 questions. Two of the questions are related to graduate response and Internet filtering. This paper provides an overview of the current discussions in France and Brittain. Furthermore it discusses the wider European debate on the basis of an analysis of the stakeholder responses to the CCO Communication by the Commission.
Introduction In France the government, the content sector and ISPs reached an agreement on an initiative to curb online copyright infringement on the Net in the so-called Olivennes Memorandum of Understanding of 23 November 2007. The agreement resulted in the HADOPI law which was adopted by the senate and is still pending in parliament. According to the new law Internet users infringing on copyright laws receive two warnings of their illegal behaviour before being disconnected from the Internet. Other countries such as the UK and Italy are considering similar approaches, with initiatives, which more or less follow the French example. The British proposal does, however, deviate in that it does not comprise the penalising component. The graduated response initiatives have been hotly debated throughout Europe, both at the national and European level. In 2008 the European Parliament has already objected to the French approach, which met with protest from the French President Sarkozy. In January 2008 the European Commission adopted a Communication on Creative Content Online (CCO),3 which aimed at launching actions to support the development of innovative business models and the deployment of cross-border delivery of diverse online creative content services. The consultation is a first step towards the preparation of a possible EU Recommendation on Creative Content Online for adoption by the European Parliament and the Council. In order to engage in a wide debate, the Commission published the "Content Online Platform", a stakeholders' forum, to initiate collaborative work with all th stakeholders. Stakeholders could present their position until the 29 of February 2008. The Commission presented stakeholders with three groups of questions under the headings of: DRM (5 1
All authors are researchers at the centre for Studies on Media, Information and Telecommunication (SMIT) of the Vrije Universiteit Brussel. SMIT is part of the Interdisciplinary institute for BroadBand Technology financed by the Flemish Community. Authors can be contacted at
[email protected],
[email protected],
[email protected] 2 Com (2007) 836 final, COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS on Creative Content Online in the Single Market, {SEC(2007) 1710}, http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2007:0836:FIN:EN:PDF, site accessed 06/05/2008 3 Com (2007) 836 final, COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS on Creative Content Online in the Single Market, {SEC(2007) 1710}, http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2007:0836:FIN:EN:PDF, site accessed 06/05/2008
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Electronic copy available at: http://ssrn.com/abstract=1996030
questions); Multi-territory rights licensing (3 questions); and Legal offers and piracy (3 questions). The Commission received contributions from Member States and Public Organizations (15), from Private Companies (49), from Associations and NGOs (178) and from European Citizens (357). Question 10 is explicitly related to the French initiative: “Do you consider the Memorandum of Understanding, recently adopted in France, as an example to followed?” Question 11 treats the related issue of internet filtering: “Do you consider that applying filtering measures would be an effective way to prevent online copyright infringements?”. The first section of this paper reports on the stakeholder analysis on the EU level concerning graduated response and internet filtering. We start by highlighting the current EU context and discussing relevant policy documents. This is followed by an analysis of the positions and opinions of various stakeholders towards graduated response and internet filtering. Graduated response and internet filtering are two solutions often proposed in the debate on online copyright infringement which require the cooperation of internet service providers. The focus of this section is to surface power struggles in the debate. The second and third section of this paper concentrate on current public proposals concerning copyright infringement, more particularly graduate respons initiatives, in two members states, France and the UK. The analysis focusses on the initiatives, their forerunners, the actors involved and their interests, the timelines of the policy developments and the current state of affairs.
Creative Content Online Stakeholder Analysis at the EU Level State of affairs at the policy level Many actions at the policy level are related to internet and/or copyright. Related to copyright owners, the Directive on the Harmonization of Certain Aspects of Copyright and Related Rights in the Information Society (the Copyright directive), and the Directive on the Enforcement of Intellectual Property Rights (IPR Enforcement directive) are relevant. Related to internet users, the Recommendation on Strengthening Security and Fundamental Freedoms on the Internet (the Lambrinidis recommendation), the Telecoms Package Review, and the Review of the Consumer Acquis are relevant. Finally, related to intermediary service providers, the Directive on Certain Legal Aspects of the Information Society Services, in particular Electronic Commerce, in the Internal Market (the e-Commerce directive), are of importance. This section does not seek to treat this broad field. Rather, our objective is to discuss EU texts that are of importance in the debate on internet and creative content. Clearly, some of the policy documents overlap with the documents already discussed. In those cases, we will highlight the current relevance. The 2004 IPR Enforcement Directive does not regulate intellectual property rights, but obliges member states to provide “measures, procedures and remedies necessary to ensure the enforcement of the intellectual property rights”. Among other things, the directive deals with evidence collection, 4 preventive measures, protective measures, and termination measures against IPR infringements. On 1 April 2009, the Swedish version of the European directive, which stipulates that ISPs need to turn over user data on court order, went into effect. The implementation of the IPR Enforcement Directive caused an immediate drop in total internet traffic, indicating a fear of repercussions among Swedish internet users. Meanwhile, two ISPs have decided to simply delete all user data. However, the obligation to provide data is not uncommon. In fact, the 2006 EU Data Retention Directive supplements this rule, by regulating the retention of data. Thus far, Sweden has failed to convert this 5 latter directive into national legislation, making the ISPsʼ move lawful (for now). This short example teaches us several lessons. First, even though the European Union passes laws, it can take a while before they are implemented in national legislation. It has taken Sweden five years to enforce the IPR Enforcement Directive! Second, there is a lot going on at the EU level concerning intellectual property EUROPEAN PARLIAMENT & COUNCIL. Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004, on the enforcement of intellectual property rights. April 29th, 2004. http://eurlex.europa.eu/pri/en/oj/dat/2004/l_195/l_19520040602en00160025.pdf Last consulted on July 13th, 2009. 5 ANDERSON (N.). EU sues Sweden, demands law requiring ISPs to retain data. On: ArsTechnica.com, May 27th, 2009. http://arstechnica.com/tech-policy/news/2009/05/eu-sues-sweden-demands-law-requiring-isps-toretain-data.ars Last consulted on July 13th, 2009. 2
Electronic copy available at: http://ssrn.com/abstract=1996030
rights. The IPR Enforcement Directive supplements the Copyright Directive. The Data Retention Directive overlaps on certain matters with the IPR Enforcement Directive. In April 2009, Internal Market and Services Commissioner Charlie McCreevy launched a new Observatory on Counterfeiting 6 and Piracy. Third, IPR enforcement is a hot topic. The IPR Enforcement Directive is not uncontested. Sweden has recently also hit headline news with its lawsuit against Pirate Bay, a major peer-to-peer (P2P) file-sharing network. The activity at the EU level is not contained to intellectual property rights. On the contrary, we are witnessing a slow adaptation of EU policy documents to the new internet environment. Another area where the European Commission has been taking careful steps pertains to online creative content. In 2005, the Commission adopted a Recommendation for the management of online rights in musical 7 works. The Commission strongly believes that the cross-border distribution of music needs to be facilitated. Currently, music rights are managed on national level by performersʼ rights organizations/collective rights management societies. It has been proposed that a pan-European license be issued, which would constitute an important step forward in building a single European online market for music. This idea has gained momentum over the past year through the discussions 8 of the Creative Content Online Consultation/Platform and the Online Commerce Roundtable. Furthermore, the Commission has been active in the area of online film content. In May 2005, a European Charter for the Development and the Take-up of Film Online (initiated by Commissioner for Information Society & Media Viviane Reding) was adopted by representatives of the content and telecoms industry. The charter recognizes the need for consumer-friendly online services and cooperation to fight online copyright infringement. It also identifies “commendable practices to bring 9 film online via legitimate services”. Finally, we would argue that the Directorate-General for Information Society & Media sought to bring together its efforts concerning internet and creative content in the Creative Content Online initiative. In January 2008, the Commission published a Communication on Creative Content Online in the Single Market. They also simultaneously launched a second consultation on the topics of digital rights management, multi-territory rights licensing and legal offers & piracy. The stakeholder analysis below discusses questions 10 & 11 of this consultation. In the Communication, the Commission contends that online content policy “can best be addressed at European level as most of these new [online creative content] services need the dual advantages of economies of scale and cultural diversity that 10 the EU internal market provides”. Although a follow-up in the form of a recommendation was expected, to date the Commission has only published a final report on the Content Online platform (a series of stakeholder meetings). The final report indicates that the Commissionʼs aim (with the Creative Content Online initiative) is twofold: “in the short term, to promote pragmatic solutions enhancing the availability of creative content online and ensuring additional revenues for all players in
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EUROPEAN UNION. IP/09/497. Internal Market: Commission launches European Observatory on Counterfeiting and Piracy. March 30th, 2009. http://europa.eu/rapid/pressReleasesAction.do?reference=IP/09/497&format=HTML&aged=0&language=EN&guiL anguage=en Last consulted on July 13th, 2009. 7 EUROPEAN COMMISSION. Recommendation 2005/737/EC of 18 October 2005 on collective cross-border management of copyright and related rights for legitimate online music services. October 18th, 2005. http://eurlex.europa.eu/LexUriServ/site/en/oj/2005/l_276/l_27620051021en00540057.pdf Last consulted on July 13th, 2009. 8 EUROPEAN UNION. IP/09/832. Commissioner Kroes welcomes progress on pan-European music licensing following Online Commerce Roundtable. May 26th, 2009. http://europa.eu/rapid/pressReleasesAction.do?reference=IP/09/832&format=HTML&aged=0&language=EN&guiL anguage=en Last consulted on July 13th, 2009. 9 EUROPEAN COMMISSION. European Charter on Film Online. http://ec.europa.eu/avpolicy/other_actions/content_online/film_online/index_en.htm Last consulted on July 13th, 2009. 10 EUROPEAN COMMISSION. COM(2007) 836 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on creative content online in the Single Market. January 3rd, 2008, p.2. http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2007:0836:FIN:EN:PDF Last consulted on July 13th, 2009. 3
Electronic copy available at: http://ssrn.com/abstract=1996030
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the value chain; in the medium term, to look at the need for regulatory interventions”. The Commission plans to adopt a second communication in September/October 2009 and has mandated a study on multi-territory licensing of audiovisual content (not music!). Concerning online copyright infringement, the report states that “no consensus on remedies” was found and that it appears “difficult 12 at this point in time to strike the right balance between all interests involved”. Back in February 2009, EurActiv already reported that the Commission had “shelved plans to curb online piracy”, because the 13 topic was too controversial and the debate had been radicalized. The European Parliamentʼs policy has mostly concerned fundamental rights of end users. In April 2008, the Parliament passed a Resolution on Cultural Industries in Europe. The French socialist Bono Guy (a fervent opponent of the French graduated response proposal) was rapporteur. The Culture and Education Committee was responsible for the non-legislative document. The resolution emphasizes that “culture and the cultural sector must be taken into consideration in all other EU policies, particularly those concerning the internal market, competition, trade, business and research & development”. The Parliament calls on the Commission to ʻput in place a structure aimed at improving the coordination of policies and activities that have an impact on the cultural and creative sector”. 14 Indeed, the Commission has provided an inventory of measures affecting the media, but coherence between policy initiatives seems to be missing at this time. Additionally, the resolution criticizes the French “three-strikes” proposal by stating that “criminalising consumers who are not seeking to make a 15 profit is not the right solution to combat digital piracy”. A further disapproval of the French policy initiative was expressed on 26 March 2009, when the European Parliament adopted a Recommendation on Strengthening Security and Fundamental Freedoms on the Internet. Lambrinidis Stavros was the rapporteur. The Civil Liberties, Justice and Home Affairs Committee was responsible for the recommendation. The Parliament emphasizes that “security, freedom of expression and the protection of privacy, as well as openness on the Internet” shouldnʼt be approached as competing goals. They also note “the danger of certain forms of Internet surveillance and control” and believes that such techniques should “always be assessed in terms of their necessity and their proportionality in light of the objectives they aim to achieve”. Finally, the recommendation also contends that “member states must ensure that freedom of expression is not subject to arbitrary restrictions from the public and/or private sphere and to avoid all legislative or administrative measures that could have a 16 “chilling effect” on all aspects of freedom of speech”. A last legislative document that is highly relevant for a discussion on internet and creative content is the Telecoms Package Review. This package revises the 2002 e-Communications regulatory framework, a step considered necessary to stay up to speed with fast developments in market & technology. The review was proposed in November 2007 and concerns a wide-ranging telecoms reform. The proposed changes relate to establishing a new European telecoms authority, giving national regulators the power to enforce functional separation for telecoms operators, providing for more flexible management of the radio spectrum, spurring investment in next generation access networks, discontinuing ex-ante regulation in eleven of the eighteen markets of the telecoms sector, 17 and ensuring strong consumer privacy, protection & security. In June 2009, the review entered a third round of negotiations, as the European Parliament & Council fundamentally disagree on the need 11
EUROPEAN COMMISSION. Final Report on the Content Online Platform. May 2009, p.1. http://ec.europa.eu/avpolicy/docs/other_actions/col_platform_report.pdf Last consulted on July 13th, 2009. 12 IDEM, p. 4. 13 EURACTIV. News. Commission shelves plans to curb online piracy. On: EurActiv.com, February 16th, 2009. http://www.euractiv.com/en/infosociety/commission-shelves-plans-curb-online-piracy/article-179431 Last consulted on July 13th, 2009. 14 EUROPEAN COMMISSION. Inventory of measures affecting the media. May 2009. http://ec.europa.eu/information_society/media_taskforce/doc/grid_inventory.pdf Last consulted on July 13th, 2009. 15 EUROPEAN PARLIAMENT. Procedure file. INI/2007/2153. Cultural industries in Europe. http://www.europarl.europa.eu/oeil/file.jsp?id=5498632 Last consulted on July 13th, 2009. 16 EUROPEAN PARLIAMENT. Procedure file. INI/2008/2160. Strengthening security and fundamental freedoms on the Internet. http://www.europarl.europa.eu/oeil/FindByProcnum.do?lang=en&procnum=INI/2008/2160 Last consulted on July 13th, 2009. 17 EURACTIV. LinksDossier. Telecoms and Internet regulation review. On: EurActiv.com, October 14th, 2008. http://www.euractiv.com/en/infosociety/telecoms-internet-regulation-review/article-169286 Last consulted on July 14th, 2009. EUROPEAN COMMISSION. eCommunications. Reforming the current telecom rules. http://ec.europa.eu/information_society/policy/ecomm/tomorrow/index_en.htm Last consulted on July 14th, 2009. 4
of a judicial decision to restrict fundamental rights & freedoms of end users. Twice, the Parliament passed an amendment (138/46) which the Council subsequently refuted. On her blog IPtegrity.com, Monica Horten (a Ph.D student researching the EUʼs online content policy) expresses satisfaction that the Parliament has stuck to its ground in defending Amendment 138/46. However, she remains concerned about restrictions to usersʼ rights, because another (revised) amendment (166) was equally passed in the Parliamentʼs second reading. Amendment 166 emphasized the importance of usersʼ rights on the internet, but was replaced by the following text: “this Directive neither mandates nor prohibits conditions, imposed by providers of publicly available electronic communications and services, limiting users' access to and/or use of services and applications, where allowed under national law and in conformity with Community law, but does provide for information regarding such 18 conditions”. Seemingly contradictory, the current Telecoms Package prohibits restrictions to be imposed on the fundamental rights & freedoms of end users without prior ruling of judicial authorities, but does allow providers of publicly available electronic communications & services to limit usersʼ access and/or use of services & applications. The Telecoms Package Review is a prime example of the difficulty to balance the interests of rights holders, internet service providers and consumers. In the debate on online copyright infringement, internet service providers often side with consumers. However, this package shows that the interests of ISPs and consumers are not always aligned. Viviane Reding commented that the dispute between the European Parliament & Council on the Telecoms Package Review is “a question of institutional 19 pride”. The Telecoms Package (and the other policy documents discussed!) are illustrative of the differences in opinion within the European Union. Regulation of the internet transects many policy areas. Within the Commission, many DGs (COMP, INFOSOC, MARKT) are involved. Within the Parliament, many committees (CULT, ITRE, IMCO, JURI) have tackled issues concerning the internet. The opinions within and between institutions can differ radically. The internet and technological innovation may require a major recast of policy measures related to creative content. The two following sections deal with the positions and opinions on the EU level towards graduated response and internet filtering. The stakeholder analysis is based on the answers provided to questions 10 & 11 of the EC 2008 Creative Content Online Consultation (CCO). Information on the CCO website indicates that the Commission received 599 answers. Citizen responses amounted to 357 of the 599 contributions. At our centre, Studies on Media, Information and Telecommunication (SMIT) we conducted an assumptional analysis on 239 contributions - all the non-citizen contributions 20 of all the questions. By introducing an alternative categorisation system, which is much more specific than the one used by the Commission itself, we were able to systematise the responses by type of organisation, type of sector, type of media, place in the value chain, etc. All responses were coded and inserted into a database for quantitative and qualitative research using NVIVO software. This provides us with a detailed insight into how different stakeholders answer the questions of the consultation. The stakeholders were divided into four main groups: associations, member states, private companies, and public organizations. According to the view expressed in the contributions, answers were coded as yes, no, nuanced, or alternative. The category “nuanced” was used for “yes, but…” answers, and the category “alternative” was used when the answer clearly stipulated an alternative view to the question or gave recommendations which clearly move away from the yes/no answer. In discussing the questions, we will pay special attention to the reasons why stakeholders support or oppose graduated response and internet filtering. Before starting with our discussion of question 10 and 11 we would like to point out that the way the Commission has framed the 11 questions can be questioned. Some of the contributions point out that the selection of topics as the framing of questions is not particularly neutral and conveys the Commissions thinking on the subjects. One could indeed critique that the Commission has framed most questions rather conservatively and in line with current ʻpay perʼbusiness models. It has certainly 18
HORTEN (M.). Telecoms Package - a licence to chill. On: IPtegrity.com, May 4th, 2009. http://www.iptegrity.com/index.php?option=com_content&task=view&id=332&Itemid=9 Last consulted on July 14th, 2009. 19 EURACTIV, News. Telecoms package remains hostage of political row. On: EurActiv.com, June 12th, 2009. http://www.euractiv.com/en/infosociety/telecoms-package-remains-hostage-political-row/article-183137 Last consulted on July 14th, 2009. 20 We also found three overlapping contributions on the CCO website. 5
not tried to uncover alternative business models. The framing of question 10 related to graduate response is rather unfortunate. By directly referring to the French graduate response system—which is the most severe proposal in terms of the punishment for copyright infringement—the Commission might have heatet the debate on graduade response even further. In any case, the result is that the whole discussion foccused on the French proposal and not so much on graduate response as a concept.
Creative Conten Online Consultation: Graduated response Question 10: Do you consider the Memorandum of Understanding, recently adopted in France as an example to be followed? Question 10 of the Creative Content Online Consultation concerns a memorandum of understanding between the French authorities, rights holders and technical service providers (Elysée Agreement) concluded on 23 November 2007. The French initiative was the first of its kind, proposing a warning & sanction system to deter online copyright infringement. It is also commonly known as a “graduated response” or “three-strikes-and-youʼre-out” approach. Internet users caught infringing copyright are sent two warning letters and then risk receiving a sanction. The French proposal deemed the suspension of internet access an appropriate sanction. The graduated response approach is described by the French government as a mainly educational measure, because internet users get two chances to change their behavior before being punished. The principal ideas in the French memorandum concern regulatory measures for a warning and sanction mechanism, legal offers (such as extending the reduced VAT rate to all cultural products & services, aligning the release of the videoon-demand window with the physical-video window & making French music catalogs available DRMfree), and experimenting & implementing filtering technologies. The following sections discus the French and British policy initiatives extensively, as both have a graduated response approach at their basis. This section does not focus on the specificities of the French memorandum, but rather analyzes the stakeholder views on the EU level towards graduated response in general. The Communication on Creative Content Online in the Single Market, on which the consultation is based, includes one paragraph on the French policy proposal. In France, a Memorandum of Understanding between music and film producers, Internet service providers and the Government was signed on 23 November 2007. Under the agreement, France is to set up a new Internet authority with powers to suspend or cut access 21 to the web for those who illegally file-share. The European Commission highlights that the memorandum is a multi-stakeholder agreement and that “France is to set up a new Internet authority with powers to suspend or cut access to the web for those who illegally file-share”. The Commission also shares that “record music and film industries have expressed the view that the Commission should be prepared to take legislative steps to make sure that the public interest in ensuring an adequate level of data protection is properly reconciled with other important public policy objectives such as the need to combat illegal activities and to protect the rights and freedoms of third parties”. Indeed, the Commission deems it “appropriate to instigate cooperation procedures (ʻcode of conductʼ) between access/service providers and right holders and 22 consumers”.
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EUROPEAN COMMISSION. COM(2007) 836 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on creative content online in the Single Market. January 3rd, 2008, p. 8. http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2007:0836:FIN:EN:PDF Last consulted on July 15th, 2009. 22 EUROPEAN COMMISSION. COM(2007) 836 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on creative content online in the Single Market. January 3rd, 2008, pp. 7-8. 6
Question 10 on graduated response was answered in 166 of the 239 analyzed contributions. Approximately half of the member states (6/11) and public organizations (19/38), and three quarter of the contributions by associations (111/150) and private companies (31/40) answered the question. The responses are quite spread out: 34% (57/166) expressed a positive view, 29% (29/166) expressed a negative view, and 33% (55/166) expressed a nuanced view. Only 4% (6/166) expressed an alternative view. Many answers found in the category “nuanced” stated that the French policy initiative was at too early of a stage to evaluate. As the figure below illustrates, the opinions of actors at the EU level are quite split. The near 30/30/30 ratio is significant, because it indicates the controversial character of the French policy measure. Only 34% of the stakeholders expressed a clear positive view towards graduated response. Our approach for this stakeholder analysis is the following: We will first outline the main actors and arguments for both the “positive” and “negative view” categories. This will be supplemented with some comments on interesting contributions within those two categories. A third subsection will expand on specific cases that differ from the main arguments. This will include opinions of stakeholders with the nuanced or alternative view.
Graph 7.1 Positions towards graduated response
Concerning the positive views, the analysis shows that especially stakeholders who suffer (directly) from online copyright infringement, support graduated response. Thus, most collective rights 23 24 management societies , (representatives of) content producers, and public organizations in the film 25 sector express a positive view towards graduated response. Artistsʼ organizations and (representatives of) content distributors agree as well, although a notable number also express a nuanced view. Finally, most interest groups and representatives of non-communication related industries, and some (representatives of) software developers are equally positive. The interest groups stand for sportsʼ interests; the representatives of the non-communication related industries are the
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2007:0836:FIN:EN:PDF Last consulted on July 14th, 2009. 23 I have usually referred to collective rights management societies as performersʼ rights organizations. In the stakeholder analyses, I will use the former term, because it has a wider scope. 24 I include “representatives of” between brackets when my statement concerns not only private companies, but also associations representing these private companies. 25 Only one out of the six public organizations in the film sector (which contributed to the CCO consultation) answered question 10. This organization, the UK Film Council, expresses a positive view. 7
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English Premier League and the Austrian Federal Economic Chamber ; the software developers, Advestigo and Excel Media offer filtering solutions. We see the breadth and depth of the level of inter-industry consensus reached in this agreement as (i) a clear recognition by both the public and private sectors that strong “content” and “infrastructure” sectors are both needed to develop tomorrowʼs knowledge societies, (ii) that these (strong) sectors are complementary and thus need to work together to make sure that a healthy online marketplace for creative content is in place, and (iii) that this co-operation will ultimately benefit the consumers who will 27 enjoy both efficient and powerful “distribution pipes” as well as rich and diversified content offerings. MPA - Motion Picture Association Supporters of graduated response highly appreciate the following features of the French initiative: •
Many actors applaud the achievement of reaching a multi-stakeholder agreement with 42 signatories. Stakeholders are especially encouraged by the involvement of the government and internet service providers. In fact, Eurocinema - an Association of Cinema & Television Producers, contends that “cultural players cannot, without the sword and scales of the Republic, implement the appropriate solutions because the balance of power between them 28 and telecoms operators and access providers is out of kilter”. Rights holders are actively seeking government intervention. Furthermore, certain stakeholders argue that ISPs should be obliged to cooperate. The English Premier League emphasizes that ISPs should be liable for 29 “failure to tackle piracy through [their] networks”.
•
The warning & sanction mechanism itself is considered important. GESAC - the European Grouping of Societies of Authors & Composers, believes that warning and administrative sanctions will be sufficient to deter minor infringers; SACD - a collective rights management society, states that warning messages will only have an effect if the threat of a sanction is present; and IFPI - the international Federation of the Phonographic Industry, underlines that “the success of any model is that it allows for a large number of cases to be dealt with 30 expeditiously”. They suggest a model of one warning followed by suspension and eventually termination of internet access.
•
The focus on legal offers is deemed positive. For example, ANICA - the Italian National Association for the Film, Audiovisual & Multimedia Industry, and McGraw-Hill - a content producer, strongly support the extension of a reduced VAT rate to all cultural products & services. However, content distributors do worry about the suggestions concerning media chronology (such as changing the alignment of the video-on-demand release window). UNIC the international Union for Cinemas, argues that the windows release system is “vital for the 31 financing of cinema”.
Concerning the negative views, the analysis shows that especially consumer & digital rights groups and intermediary service providers oppose graduated response. Thus, most consumer organizations, open source movements, (representatives of) aggregators, (representatives of) internet service providers, and (representatives of) telecoms & cable operators express a negative view towards 26
In retrospect, the Austrian Federal Economic Chamber probably should have been coded as a public organization. 27 MOTION PICTURE ASSOCIATION. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/mpa_en.pdf Last consulted on July 18th, 2009. 28 EUROCINEMA. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/eurocinema_en.pdf Last consulted on July 18th, 2009. 29 ENGLISH PREMIER LEAGUE. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/english_pr_league_en.pdf Last consulted on July 18th, 2009. 30 INTERNATIONAL FEDERATION OF THE PHONOGRAPHIC INDUSTRY. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/ifpi_en.pdf Last consulted on July 18th, 2009. 31 INTERNATIONAL UNION OF CINEMAS. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/unic_en.pdf Last consulted on July 18th, 2009. 8
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graduated response. Most political organizations, public institutions, and research institutions are equally negative. Some (representatives of) consumer electronics companies disagree as well, although a notable number also express a nuanced view. Finally, the (representatives of) software developers form an interesting case: three disagree and four agree. The developers expressing a negative view are the Business Software Alliance, the European Market Association and Microsoft. We do not consider the Memorandum of Understanding, recently adopted in France, to be an example to be followed and we are greatly concerned to hear of similar proposals in the United Kingdom. We view this as a draconian measure that will further alienate consumers and erode respect for copyright in the online environment while at the same time representing another impractical solution. We have two main objections to this type of proposal: firstly, it is entirely disproportionate and excessive, and secondly it is impossible to enforce. This type of measure will only increase costs for all internet users, through ISPs passing on their costs, and account for a substantial 33 amount of public resources attempting to enforce the unenforceable. MacRoberts (law & consultancy company) Stakeholders oppose graduated response for the following reasons:
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•
Certain actors, such as the European Competitive Telecommunication Association and the INTEL Corporation, prefer voluntary agreements. It is also expressed that the French memorandum is a reflection of the governmentʼs desire to survey and control.
•
Suspension of internet access is considered a disproportionate response to online copyright infringement. Public Knowledge - a US Public Interest Advocacy Organization, states that it displays “a markedly narrow conception of the importance and uses of the Internet” and 34 emphasizes that the internet is a “vital means of communication”.
•
This ties into a third criticism of graduated response: many stakeholders foresee legal issues with the sanction mechanism. They believe that graduated response does not take the presumption of innocence, the right to freedom of expression, and the right to public information into account. BEUC - the European Consumersʼ Organization, contends that graduated response will have a “chilling effect” on freedom of speech.
•
Graduated response is also deemed to breach articles 12 through 15 of the e-Commerce Directive. These establish an exception of liability for intermediary service providers and stipulate that intermediary service providers play a “mere conduit” role.
•
Practical issues, such as the difficulty to suspend access in multiple-play situations and to provide “safe” wireless in public spaces, are mentioned. Many stakeholders also doubt the effectiveness of filtering technologies. The Open Rights Group - a civil & digital rights organization, points out that filtering can be circumvented through encryption and believes that 35 it will cause “the practice of illicit filesharing [to be] driven further underground”.
•
Two other arguments are noteworthy. BT - British Telecommunications, believes that suspension of internet access is “a austere measure and goes against efforts by the 36 Commission to tackle the Digital Divide”. Google and the European interest group of the
Only one out of the six public institutions (which contributed to the CCO consultation) answered question 10. This organization, the European bureau for libraries, archives and documentation associations, expresses a negative view. 33 MACROBERTS. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/macroberts_en.PDF Last consulted on July 18th, 2009. 34 PUBLIC KNOWLEDGE. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/public_knowledge_en.pdf Last consulted on July 18th, 2009. 35 OPEN RIGHTS GROUP. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/org_en.pdf Last consulted on July 18th, 2009. 36 BRITISH TELECOMMUNICATIONS. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/bt_en.pdf Last consulted on July 18th, 2009. 9
GSM argue that the “primary focus should be the creation of conditions for innovative internet 37 services to emerge in Europe” and regret that the commitment to legal offers in the French policy approach is conditional to graduated response operating effectively. Some differences within stakeholder groups should be discussed. Concerning the nuanced views, most stakeholders state that the French policy initiative was in too early of a stage to evaluate. Several organizations, such as AFA - the French Association for Internet Access & Service Providers, ASIC - a French open source movement, Nokia, and Philips, also emphasize that a balance between offering legal online services and fighting copyright infringement, and between intellectual property rights and fundamental rights, needs to be found. Furthermore, while most content producers & distributors agree with graduated response, the European Publishers Council, the Federation of European Publishers, and the UK Publishers Association, wish to avoid a “one size fits all solution” and stress that abandoning DRM is not desirable for the publishing sector. Many artistsʼ organizations and collective rights management societies express a positive view towards the French policy initiative. However, the International Federation for Musicians, the International Music Managers Forum, and AEPO-ARTIS the Association of European Performersʼ Organizations, contend that graduated response is a 38 “repressive policy in the internet environment” that favors existing business models. Last, although many stakeholders would argue that the French memorandum is partial to the interests of rights holders, several stakeholders believe that the initiative doesnʼt support rights holders enough. The British Copyright Council asserts that the memorandum lets ISPs of the hook; SABAM - the Belgian collective rights management society, disagrees with graduated response, because it believes that stronger emphasis should be laid on filtering technologies; and the Stockholm Network - a marketoriented research institution, maintains that intermediary service providers are currently enjoying a free lunch on behalf of many content producers.
Creative Content Online: Internet filtering Question 11: Do you consider that applying filtering measures would be an effective way to prevent online copyright infringements? Question 11 of the Creative Content Online Consultation concerns the application of filtering measures. Internet filtering can be defined as the identification and restriction of internet content. The identification of internet content can be achieved in various ways, such as fingerprinting and watermarking. Similarly, the restriction can also be done in different manners, such as the denial of access to content, the removal of content, or the filtering of content from a network. It is our hypothesis that the content industry will increasingly resort to filtering technologies to fight online copyright infringement. Indeed, it seems that rights holders are lobbying for ISPs to be obliged to apply filtering on their networks. In June 2007, SABAM - the Belgian collective rights management society, won a case in the Belgian Court of First Instance against the ISP Scarlet, obliging the latter to implement filtering measures to prevent P2P copyright infringements. Additionally, in June 2009, GEMA - the German collective music rights management society, won a case in the Hamburg Regional Court against the file hosting service RapidShare, requiring the latter to apply strong content filtering to user uploads. These two court cases are examples of the content industryʼs shift from suing end users to intermediary service providers. Herein, they contend that intermediaries share a responsibility in the fight against copyright infringement. We would argue that they are essentially calling for an end to “mere conduit” and net neutrality. Moreover, internet filtering has made it onto the policy agenda. Both the French and British policy initiatives include proposals on experimentation and implementation of filtering technologies. The fact that the Creative Content Online Consultation contains a question on the application of filtering measures is also indicative. However, it is interesting that the Communication on Creative Content Online in the Single Market does not refer to internet filtering. This means that the definition of filtering 37
GOOGLE. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/google_en.pdf Last consulted on July 18th, 2009. 38 AEPO-ARTIS. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/aa_en.pdf Last consulted on July 18th, 2009. 10
measures was left to the interpretation of stakeholders. The Commission does mention fingerprinting & watermarking in the Final Report on the Content Online Platform. They report that the platform generally concluded that these content recognition techniques are “promising and useful instruments for the protection of intellectual property rights, with even a potential to help with the construction of 39 monetisation models for content” .
Question 11 on internet filtering was answered in 160 of the 239 analyzed contributions. Quite a high number of private companies and associations answered the question: over 80% of private companies (33/40) and almost 70% of associations (104/150). The response rate of member states and public organizations was lower: approximately half of the member states (6/11) and public organizations (17/38) submitted an answer. Comparable to question 10 on graduated response, the responses are quite spread out: 33% (52/160) expressed a positive view, 34% (55/160) expressed a negative view, and 27% (43/160) expressed a nuanced view. Only 6% (10/160) expressed an alternative view.
Graph 7.2 Positions towards internet filtering
Similar to the answers on graduated response, the opinions on internet filtering are quite split. We observe a near 30/30/30 ratio, which is significant, because it indicates the controversial character of applying filtering measures. Only 33% of the stakeholders express a clear positive view towards graduated response. Our approach for the stakeholder analysis remains the same: we will outline the main actors and arguments for both the “positive” and “negative view” categories. This will be supplemented with some comments on interesting contributions within those two categories. A last subsection will expand on specific cases that differ from the main arguments. This will include opinions of stakeholders with the nuanced or alternative view. However, let me start with an overview of how stakeholders define internet filtering.
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EUROPEAN COMMISSION. Final Report in the Content Online Platform. May 2009, pp. 4-5. http://ec.europa.eu/avpolicy/docs/other_actions/col_platform_report.pdf Last consulted on July 18th, 2009. 11
The French authorities contend that filtering consists of three steps: labeling of works by right sholders, applying filtering measures by ISPs, and identifying the IP address or blocking the content. This definition is useful, because it not only recognizes the identification process in internet filtering (and the inherent involvement of both rights holders and ISPs), but also the action process (distinguishing between identification of IP addresses for lawsuit purposes and actual restriction of content). Additionally, they express that filtering can happen in a preventive or repressive (proactive vs. reactive) manner. Preventive filtering involves active filtering & blocking on networks, while repressive filtering is limited to monitoring. The French authorities, together with EBLIDA - the European Bureau for Libraries, Archives and Documentation Associations, and ETNO - the European Telecommunications Networks Operatorsʼ Association, warn against filtering proactively, because it can constitute problems with privacy regulation and the “no general monitoring” rules in the eCommerce Directive. We find it encouraging that the French authorities make this distinction, considering the French policy initiative includes plans to experiment and implement filtering measures. However, they do not mention if the repressive filtering (the term is a little worrying) would be based on a court order. Some stakeholders expand on the identification process in internet filtering. Three software developers offering filtering solutions (Advestigo, Audible Magic, and ExcelMedia) provide details on their content recognition technologies. All three use fingerprints and perpetual hashes to identify content. Many stakeholders also mention different levels at which filtering can be applied: files, websites, protocols, ports, and networks. GVAIVD - a German content distributor, and APRIL - a French open source movement, discuss the use of filtering programs on the end user devices. The former believes that more should be done, using RapidShare as an example of services where filtering needs to be applied. The latter contends that only filtering by end users is “tolerable”, because it is optional and chosen by users. AFA - the French Association for Internet Access & Service Providers, uses more technical terms, such as blocking of IP addresses, URLs and DNSs. AFA and several other stakeholders (EDIMA - the European Digital Media Association, ENPA - the European Newspaper Publishers Association, FAEP - the European Federation of Magazine Publishers, Yahoo!, and more) deem blocking on the level of online services reasonable, but on the level of networks disproportionate and ineffective. Concerning the positive views, it is remarkable that only collective rights management societies and representatives of non-communication related industries (the English Premier League and the Austrian 40 Federal Economic Chamber ) completely agree with internet filtering. In all other stakeholder groups, a substantive number also express nuanced or negative views. The analysis shows that artistsʼ 41 organizations, (representatives of) content distributors, and (representatives of) software developers express both a positive and nuanced view. Furthermore, interest groups, representatives of the general content & digital industry, (representatives) of content producers, and research institutions express both a positive and negative view towards internet filtering. Let us provide details on some of the stakeholder groups. The software developers supporting internet filtering have an obvious interest: they offer filtering technologies (Advestigo, Audible Magic, ExcelMedia, and SAFEMEDIA). The interest group expressing a positive view represents authors (ALADDA - a Spanish Literary & Artistic 42 Association Defending Authorsʼ Rights ). In the content & digital industry category, it is quite clearly the representatives of the content industry who agree with filtering (ANICA - the Italian National Association for the Cinema, Audiovisual & Multimedia Industry, the Creative Media Business Alliance, FAF - an Austrian Association for the Audiovisual & Cinema Industry, and the Independent Film & Television Alliance). Finally, the supportive research institution is the Stockholm Network - a panEuropean market-oriented think tank. Despite the mixed composition of the group, We think it is fair to conclude that most stakeholders expressing a positive opinion are either rights holders (who can use filtering measures to protect their content) or software developers (who offer the filtering measure to protect content).
40
In retrospect, the Austrian Federal Economic Chamber probably should have been coded as a public organization. 41 I include “representatives of” between brackets when my statement concerns not only private companies, but also associations representing these private companies. 42 In retrospect, ALADDA probably should have been coded as an artistsʼ organization. 12
The rapid evolution of technology has exacerbated the problem of mass infringement of copyright online, and we believe that technology has the capacity to address it. [...] When filtering measures are implemented by ISPs, they have the potential to be extremely effective, given the unique position of ISPs as the gateway to all traffic on the internet. It must of course be kept in mind that no technology is in itself a 100% complete fix to the online piracy problem. [...] It is essential that technology is treated as a tool to implement an ISPʼs policy of addressing piracy in its network rather than a solution in itself. [...] With cooperation from ISPs, technology and filtering measures can be used to support and supplement enforcement by 43 right holders thereby to some extent shifting focus away from individual lawsuits. IFPI - International Federation of the Phonographic Industry Stakeholders who defend the application of filtering measures raise the following arguments: •
As the quote above from the IFPI indicates, filtering is considered a tool, rather than a solution in itself. It is comforting that many stakeholders point out the need for a package of solutions to fight online copyright infringement. For filtering, the question is whether the emphasis will lie on application for the purpose of protection or development of new business models.
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Stakeholders believe that internet filtering will be beneficial for internet service providers, because it can help manage internet traffic and deal with network congestion. Some also mention that ISPs already implement filtering technologies for their own commercial interests.
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It is frequently stated that internet service providers should be responsible for activity on their network. The IFPI points to “the unique position of ISPs as the gateway to all traffic on the internet”, the MPA underlines that “online copyright theft constitutes a violation of the ISPʼs 44 terms of service” , and the Stockholm Network also pleads for “greater use of filtering 45 technologies and disclaimers by online mediators” (such as YouTube).
•
Many stakeholders contend that filtering measures do not violate privacy regulation, because the process is automated. They also believe that legislation in the e-Commerce Directive on the “mere conduit” role of intermediaries is respected. It should be noted that the distinction made by the French authorities concerning proactive and reactive filtering is important. We presume the stakeholders are referring to reactive filtering.
•
The SABAM-Scarlet court decision is used as a showcase model to support their arguments. Filmfolket - the Swedish association of the film & television industry, expresses approval but states that the court case shows the “lack of coherence in the implementation of the copyright 46 directive throughout the EU”.
Concerning the negative views, the analysis shows that especially civil & digital rights groups and intermediary service providers oppose the application of filtering measures. Thus, most consumer organizations, open source movements, (representatives of) aggregators, (representatives of) internet service providers, and (representatives of) telecoms & cable operators express a negative view towards internet filtering. Most law & consultancy companies, political organizations, and public institutions are equally negative. Within the group of content producers, it is notable that several associations of publishers disagree with filtering. (Representatives of) consumer electronics companies express either a negative or nuanced view: the European interest group of the GSM, INTEL and Sun oppose filtering measures. Finally, the majority of interest groups, representatives of the content & digital industry, and research institutions disagree as well; although some stakeholders also express a positive view. The interest groups expressing a negative view are Digital Media Italy 43
INTERNATIONAL FEDERATION OF THE PHONOGRAPHIC INDUSTRY. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/ifpi_en.pdf Last consulted on July 18th, 2009. 44 MOTION PICTURE ASSOCIATION. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/mpa_en.pdf Last consulted on July 18th, 2009. 45 STOCKHOLM NETWORK. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/stockhnetw2_en.pdf Last consulted on July 18th, 2009. 46 FILMFOLKET. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/filmfolkets_en.pdf Last consulted on July 18th, 2009. 13
and the Digital Media Project. In the content & digital industry category, it is quite clearly the representatives of the digital industry who disagree with filtering (BITKOM - a German Association for Information Technology, Telecommunications & New Media, BVDW - a German Association for the Digital Economy, ECO - a German Association for the Internet Economy, and VOIPEX Consortium). The opposed research institutions are IRII - the Lithuanian Internet Research & Innovation Institute and KTH - the Royal Institute of Technology in Stockholm. The real question facing policy makers and industry is whether existing filtering measures are a proportionate, cost-effective, efficient approach to dealing with online copyright infringements in a way which will not have considerable unintended consequences outside the scope of the problem being addressed. In general, EuroISPA believes that the development of innovative content services that meet consumer expectations and needs is the most effective way to prevent online copyright infringement and is far more effective than measures aimed at 47 restricting the rights of users to access online information. EuroISPA - the European Internet Service Providers Association Stakeholders oppose internet filtering for the following reasons: • The effectiveness of filtering measures is doubted. Several stakeholders point out that implementing filtering is complex and costly. The possibility to circumvent filtering through encryption is also often mentioned.
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•
A second closely related criticism concerns risks and unintended side effects. Many stakeholders believe that filtering will block access to legitimate content, lead to a decrease in the quality, availability & stability of services, and intrude on end usersʼ privacy. They also contend that filtering cannot distinguish between fair use and copyright infringement. Additionally, Digital Media Italy - an interest group, fears for a technological arms race. ECTA the European Competitive Telecommunication Association, and British Telecom deem filtering measures detrimental for competition. Furthermore, several publishers also oppose internet filtering, because “free access to the public internet is a necessary precondition for freedom of 48 the press”.
•
Stakeholders argue that filtering is contrary to the “mere conduit” principle in the e-Commerce Directive. In this context, the contribution of FTOG - the France Telecom Orange Group, is interesting because they are a second French telecoms group (the first being AFA) opposing the application of internet filtering. FTOG asserts that they are “unwilling to set up filtering techniques aimed at preventing specific crime, such as copyright infringement, without any 49 specific authority, in charge of enforcing the law”. Furthermore, Sun Microsystems expresses that “the beauty and quality of the design of the Internet lies in its neutrality as to content” and “believes that a solution involving filtering would be a serious technical, cultural, and business mistake - and because this ʻsolutionʼ involves building technology into infrastructure, it would 50 be a mistake from which it would be difficult to recover.” This quote reflects authors such as Lessig and Zittrainʼs thoughts on the repressive potential of technology.
•
Stakeholders opposing internet filtering state clear preference for the education of end users and offers of legal online services. For example, the Stockholm Royal Institute for Technology points to an initiative of STIM - the Swedish collective rights management society, with ISPs to negotiate blanket license deals, and the Digital Media Project - an interest group, advocates DRM interoperability. Lastly, the European interest group of the GSM and Hutchison Whampoa Europe 3 Group - a telecoms operator, provide a useful guide of six elements which
EUROPEAN INTERNET SERVICE PROVIDERS ASSOCIATION. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/euroispa_en.pdf Last consulted on July 18th, 2009. 48 EUROPEAN FEDERATION OF MAGAZINE PUBLISHERS. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/faep_en.pdf Last consulted on July 18th, 2009. 49 FRANCE TELECOM ORANGE GROUP. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/fto_en.pdf Last consulted on July 18th, 2009. 50 SUN MICROSYSTEMS. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/sun_%20en.pdf Last consulted on July 18th, 2009. 14
a new business model would need to capture: “wide variety of choice to meet consumer demand, easy access, mobility, convenience, clarity of the offer & control over which the 51 device the content will be consumed on”. Fourth, we would like to discuss some differences within stakeholder groups. The International Music Managers Forum is the only artistsʼ organization to oppose internet filtering. They believe that the focus should be on “finding ways of turning ʻpiratesʼ into good costumers” and that “filtering which attempt to stop music consumer consuming music the way that they want to will always fail and thus 52 never be successful”. Additionally, the consumer electronics companies Nokia and Philips express alternative views. Nokia contends that filtering “should not be utilized to directly interfere with traffic but instead be used to generate information about traffic on the basis of which further measures can be 53 taken, subject to appropriate safeguards”. Philips (itself a producer of watermarking technology) suggests a voluntary installation of filtering in P2P sharing software. Finally, it is interesting that both public & private broadcasters express a nuanced view on internet filtering. They state that filtering measures can be useful to fight online copyright infringement, but think that safeguards will need to be built in.
Conclusion This section looked at the European debate on online copyright infringement. We discussed current regulatory measures at the EU level and analyzed the opinions of EU stakeholders towards graduated response and internet filtering. It has been especially striking to reveal the radically different interests represented in the debate. Recently, at the Lisbon Council, Viviane Reding expressed regret that the debate has become so polarized. She stressed the importance of making digital content available to ensure Europeʼs future as a digital economy. The availability of attractive content that appeals to European viewers, listeners and readers will be decisive in driving further the take-up of high-speed broadband internet. It is therefore regrettable that we currently have an extremely polarised debate on the matter: While many right holders insist that every unauthorised download from the internet is a violation of intellectual property rights and therefore illegal or even criminal, others stress that access to the internet is a crucial fundamental right. Let me be clear on this: Both sides are right. The drama is that after long and often fruitless battles, both camps have now dug themselves in 54 their positions, without any signs of opening from either side. Put generally, we noticed that while most rights holders support graduated response and internet filtering, many citizen & digital rights groups and intermediary service providers oppose them. In terms of Lessigʼs means of regulation and corresponding groups, the “market” is set up against “norms” & “technology”, with all three seeking to influence the policy problem through “law”. Of course, reality isnʼt quite black & white. The analysis also showed differences of opinion within stakeholders groups. Diverging voices are heard. Among the artistsʼ organizations, the International Music Managers Forum openly expresses a negative view towards graduated response and internet filtering. Within the content industry, publishers are wary about offering products DRM-free and about the influence of internet filtering on press freedom. The International Union for Cinemas is unsure and expresses concern about proposed changes to media chronology. The analysis also showed that the opinions of
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GSM EUROPE. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/gsme_en.pdf Last consulted on July 18th, 2009. 52 INTERNATIONAL MUSIC MANAGERS FORUM. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/ngo/immf_en.pdf Last consulted on July 18th, 2009. 53 NOKIA. Contribution to the 2008 EC Creative Content Online consultation. http://ec.europa.eu/avpolicy/docs/other_actions/col_2008/comp/nokia_en.pdf Last consulted on July 18th, 2009. 54 REDING (V.). Digital Europe - Europeʼs fast track to economic recovery. Speech presented during: Lisbon Council, Brussels, July 9th, 2009. http://europa.eu/rapid/pressReleasesAction.do?reference=SPEECH/09/336&format=HTML&aged=0&language=E N&guiLanguage=en Last consulted on July 12th, 2009. 15
software developers are split and that public & private broadcasters express a nuanced view towards both graduated response and internet filtering. Additionally, power struggles are evident in the current relevant EU documents. We observe interinstitutional clashes not only in the Telecoms Package Review, but also in the nature of other documents drafted and passed. The focus seems to lay on intellectual property rights on the one hand and fundamental freedoms on the other hand. Both the content and telecoms industry are lobbying hard. Consumers/citizens are present as well. In an expert interview, Monica Horten skeptically 55 asserted that politicians only listen to citizens if society expresses a solid opinion. It is good to see civil & digital rights groups unite and become the organized voice of consumers/citizens. Finally, this section has also shown that many stakeholders believe that a balance of interests is needed to fight online copyright infringement. It has become equally clear, however, that this concept of “balance” is subjective. Supporters of graduated response call it a balanced approach. Opponents contend that it favors the content industry. The differences in opinion run deep. We believe that copyright infringement can only be solved through enforcement AND legal offers. You can hit a horse with sticks, but carrots may get you further. Copyright infringers need incentives to stop.
France: The Memorandum of Understanding and the Loi Hadopi In November 2007, the French government brokered a memorandum of understanding between rights holders and technical service providers concerning “the development and protection of cultural works and programmes on the new networks”. A government bill followed closely, resulting in the promulgation of a first set of legislation in June 2009. In the bill, the French Ministry for Culture & 56 Communication indicates that negotiations were “intentionally very fast, as the situation is urgent”. Dubbed “three-strikes-and-youʼre-out”, the French government and industry intend to implement a system where internet users lose access to the internet if caught repeatedly infringing intellectual property rights. The initiative has known wide opposition on both national and European level. As it happens, the government bill was rejected in the first reading by the French Parliament and received a negative advice from the French Constitutional Council. The Council ruled that suspension of internet access should only happen based on a court order. The accepted sections of the government bill were promulgated, which allow a system of warning messages to be set up. A new law proposal, which stipulates the obligation of a judicial decision to sanction, was submitted shortly after and was passed by the French Senate in July 2009. The aim of the French policy initiative is to halt online copyright infringement through a graduated response approach. The first paragraph of the first government bill (project de loi Création & Internet) reads as follows: This bill seeks to halt the drain of cultural works on the internet and create a legal framework which is indispensable for a legal offer of music, films, audio-visual works and programmes and even literary works on the new communication networks. For this purpose, it created a mainly educational measure which aims in practice to replace the criminal prosecution to 57 which internet users infringing authorsʼ rights currently expose themselves. A few important premises underlie the French policy proposals: first, in the explanatory memorandum of Creation & Internet, the Ministry of Culture & Communication shares that, with over 50% of the French population having access to high-speed internet connections, they have reached “a real turning point”. They believe that it is “an extraordinary opportunity” for the dissemination of culture, BUT at the same time, that the conditions for creating cultural works have never been so much under “threat”. The Ministry quotes statistics that “the recorded music market has fallen 50% in volume and in value during the last five years”, a phenomenon which they ascribe to illegal downloading.
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HORTEN (M.). pp. 168-169. FRENCH MINISTRY OF CULTURE AND COMMUNICATION. Government bill promoting the dissemination of protection of creative works on the internet (TRANSLATION). Paris, Ministry of Culture and Communication, 2008, p. 2. http://www.culture.gouv.fr/culture/actualites/conferen/albanel/creainterenglish.pdf Last consulted on July 9th, 2009. 57 IDEM, p. 1. 16 56
Second, “the culture of pirated works is [...] the main obstacle to the development of legal downloads” in France. They share that digital sales seem “much lower than in other developed countries with comparable consumer habits” (such as the United States), but remain optimistic, stating that “the wealth of legal downloads on offer has greatly increased in the last few year”. The penalty against illegal downloading in France is “a maximum fine of €300.000 and up to three years imprisonment”. The Ministry considers the legal procedure inappropriate (and inefficient) in the event of ordinary pirating. Consequently, they wish to implement an alternative system whereby internet users are warned and ultimately sanctioned for their illicit behavior. They present this as “a mainly educational measure”, because users are given two chances (or two strikes, as argued by the opponents of the bill), before being sanctioned (preferably through suspension of internet access). Third, in the explanatory memorandum, the Ministry quotes studies that show that “70% of internet users would stop downloading on receiving an initial warning message and 90% on receiving a second one”. The Ministry also deems it crucial that the new warning & sanction mechanism is accompanied by the development of legal offers. The commitments to legal offers, however, are part of a memorandum of understanding and thus less binding. An independent administrative authority (HADOPI) would oversee the whole process. HADOPIʼs three missions are “the protection of works on the new networks of communication, the monitoring of their illegal use & the development of the legal 58 offer, and regulation in the fields of technical protection measures and identification”.
Forerunners A first important document for the policy initiative is the French Intellectual Property code, which aims 59 at “promoting the dissemination and protection of creative works on the internet”. Article L. 335-12 of the Intellectual Property code stipulates that “the holder of access to an online communication service for the public has to ensure that this access is not subject to a use which fails to respect literary or 60 artistic copyright”. The French policy proposal seeks to send warning messages to subscribers who allow illegal activities on their network. Disconnection of their internet connection -after repeated infringements- is also on the table. The Creation & Internet government bill amends the Intellectual Property code (especially Part I, Section III, Title III on “Prevention, procedures and sanctions”), instructing the creation of an independent administrative authority for the dissemination of works and the protection of rights on the internet (HADOPI - Haute Autorité pour la Diffusion des Œuvres et la Protection des droits sur Internet). The French 2006 DADVSI law (loi relatif au Droits dʼAuteur et aux Droits Voisins dans la Société de lʼInformation) addresses on authorsʼ rights and related rights in the information society. It is the French implementation of the EU Copyright Directive and is mostly known for its condemnation of P2P file sharing and criminalization of DRM circumvention. An independent administrative authority for the regulation of technical measures (ARMT - Autorité de Régulation des Mesures Techniques) was set up. In the Creation & Internet government bill, HADOPI replaces ARMT. The Elysée or Olivennes agreement instigated the French policy initiative and was signed on 23 November 2007 by forty-two parties, including many content producers & distributors, private broadcasters, syndicates, trade unions, and several telecommunication & cable operators. The agreement is a memorandum of understanding between public authorities, rights holders and technical service providers, and laid the foundation for the government bill. It encourages fighting online copyright infringements by “promoting the availability of legitimate content on the Internet [...] and 61 implementing new measures to prevent pirating”. Important suggestions are regulatory measures for
58
FRENCH MINISTRY OF CULTURE AND COMMUNICATION. Government bill promoting the dissemination of protection of creative works on the internet (TRANSLATION). Paris, Ministry of Culture and Communication, 2008, pp. 1-5. http://www.culture.gouv.fr/culture/actualites/conferen/albanel/creainterenglish.pdf Last consulted on July 9th, 2009. 59 IDEM, p. 1. 60 IDEM, p. 10. 61 OLIVENNES (D.). Agreement for the development and protection of cultural works and programmes on the new networks (TRANSLATION). Paris, Ministry of Culture and Communication, 2007, p. 1. 17
a warning and sanction mechanism, legal offers such as aligning the release of the video-on-demand window with the physical-video window, and experimentation with filtering technologies.
Actors The French executive branch (government) has been involved in the initiative since the very beginning. The Olivennes mission was commissioned by the Ministry of Culture & Communication (the presiding minister was Christine Albanel), who also submitted the subsequent government bill. Additionally, the President of France, Nicolas Sarkozy, has shown clear favor for this bill. In his speech on 23 November 2007, on the occasion of the Elysée Agreement, he underscored the importance of fair remuneration of artists, regulation of the internet and education of the youth. In October 2008, after the European Parliament voted an amendment that posed a threat to the French initiative into the Telecoms Package Review, president Sarkozy addressed a letter to the president of the European 62 Commission, José Manuel Barroso, asking for his personal commitment to intervene on the matter. In 2008, two independent agencies to the French government (CNIL - Commission Nationale de lʼInformatique et des Libertés and ARCEP - Autorité de Régulation des Communications Eléctroniques et des Postes), expressed reserve towards the proposal for a Creation & Internet government bill (avant-projet de loi). They brought up potential dangers to personal data protection and mentioned the 63 difficulty of suspending internet connections in a situation where multiple play contracts are common. The French legislative branch (parliament) examined the bill multiple times. The proposal was rejected in first reading by the National Assembly, while passaging fairly easily in the Senate. Within the National Assembly, opposition to the proposal mainly came from the Socialist and Green Parties. A joint commission (Comité Mixte Paritaire) was formed to reconcile the opinions of the National Assembly and Senate. Creation & Internet was eventually adopted on 12 May 2009 by the National 64 Assembly (296 against 233), and on the following day, 13 May 2009, by the Senate (189 against 14). The French judicial branch was brought into the policy process by an appeal of the Socialist Party to the Constitutional Council. On 10 June 2009, Creation & Internet was declared unconstitutional on grounds of infringing articles 9 & 11 of the French 1789 Declaration of the Rights of Man and of the Citizen. These articles concern the freedom of communication & expression, and the presumption of innocence. The Constitutional Council ruled that implementation of sanctions should only happen based on a court decision (thus-far the bill allowed the High Authority to mandate suspension of internet access) and that freedom of communication & expression equals freedom to access online communication services for the public. It also deemed that the draft law laid the burden of proof on the subscriber, in essence acting on a presumption of guilt, rather than innocence. Finally, issues of data protection were also mentioned. The Constitutional Council expressed that there was an obvious unbalance between the protection of authorsʼ rights and the protection of the right to the respect of 65 private life. The French government promulgated the accepted sections of the draft law on 13 June 2009, and submitted a new version of the government bill (called HADOPI 2) on 24 June 2009.
http://www.culture.gouv.fr/culture/actualites/dossiers/internet-creation08/Accords_%20Version_anglaise.pdf Last consulted on July 9th, 2009. 62 GIRARDEAU (A.). Exclu: Lettre de Sarkozy à Barroso pour la riposte graduée. On: Ecrans.fr, October 6th, 2008. http://www.ecrans.fr/Exclusif-La-lettre-de-Sarkozy-a,5340.html Last consulted on July 8th, 2009. 63 LʼEXPRESS. La Cnil et lʼArcep critiquent aussi la future loi sur le téléchargement. On: LʼExpress.fr, May 30th, 2008. http://www.lexpress.fr/actualite/media-people/media/la-cnil-et-l-arcep-critiquent-aussi-la-future-loi-sur-letelechargement_505637.html, FRENCH NATIONAL COMMISSION FOR DATA PROCESSING & LIBERTIES. Conférence de Presse. Présentation du 29ième rapport dʼactivité 2008. http://www.cnil.fr/fileadmin/documents/La_CNIL/actualite/CNILDP_2009.pdf Last consulted on July 9th, 2009. 64
EDRI-GRAM. France: Three strikes law voted for good. In: EDRI-Gram, 2009, no. 7.10. http://www.edri.org/edri-gram/number7.10/france-three-strikes-voted Last consulted on July 8th, 2009. 65 FRENCH CONSTITUTIONAL COUNCIL. Décision no. 2009-580 DC du 10 juin 2009. Loi favorisant la diffusion et la protection de la création sur internet. June 10th, 2009. http://www.conseil-constitutionnel.fr/conseilconstitutionnel/francais/les-decisions/2009/decisions-par-date/2009/2009-580-dc/decision-n-2009-580-dc-du-10juin-2009.42666.html Last consulted on July 8th, 2009. 18
Besides the French authorities, another actor who played an obvious, but crucial role are the rights holders. In the memorandum of understanding, they agreed to “evaluate, promote and select common fingerprinting & watermarking technologies”, help develop fingerprint reference catalogues, “once the warning and sanction mechanism is effectively operating, align the opening of the video-on-demand window with the physical-video window”, begin discussions to reorganize the media chronology, “do their utmost best to make [audiovisual and] cinematographic works systematically available via videoon-demand”, and “make available [...] catalogues of French musical productions for online sale by title 66 without technical protection measures”. However, as became evident in our analysis of the 2008 EC Creative Content Online Consultation, the content industry is not a homogenous group. In the consultation, the International Federation of Musicians (FIM - Fédération Internationale des Musiciens) expressed regret that artistsʼ organizations were not more involved in the preparation of the Elysée Agreement. Many artists, whom the draft bill targets as beneficiaries, also stated disapproval of the policy initiative. Two actions taken to show opposition were a petition signed by over a hundred 67 68 science-fiction authors, editors & translators, and a concert held in Paris called “HADOPI mʼa tuer”. Multiple technical service providers (internet service providers, hosting & content sharing platforms) also committed to the Elysée Agreement (France Télécom, Iliad, Neuf Cegetel, Numéricable, and Télécom Italia). Indeed, in the memorandum of understanding, they agreed to “send warning messages in the name of the authority”, “implement any sanctions”, experiment with filtering technologies, “deploy them if the results are convincing and if their general application would be technically and financially realistic”, extend the use of “efficient fingerprinting & watermarking 69 technologies” and develop fingerprint catalogues with the rights holders. However, we equally notice in this category of stakeholders that opinions are not uniform. In the Creative Content Online Consultation, the French association for internet access & service providers (AFA - Association des Fournisseurs dʼAccès et de Services Internet) expressed serious doubts about the Elysée Agreement. The AFA believed that the obligations for sharing platforms would breach the e-Commerce “mere conduit” principles. They also thought that there would be issues with fundamental rights (such as the right to defense and individual freedom, the right to anonymity, and the right to the respect of private life), and underlined the inopportunity & inefficiency of content filtering on the network of internet access providers. A stakeholder who was excluded from the Elysée Agreement and has strongly opposed the Creation & Internet draft law, are civil & digital rights groups. Several French associations submitted contributions to the Creative Content Online Consultation (ABUL - Association Bordelaise des Utilisateurs de Logiciels Libres, APRIL - Promouvoir et défendre le logiciel libre, ODEBI - Organisation Française de Défense des Libertés Numériques, Parti Pirate Français, and UFC Que Choisir). They saw the agreement as another attempt by government and industry to control the internet, considered suspension of internet access a disproportionate measure, and foresaw issues with fundamental rights & separation of powers. In April 2009, five associations founded a platform to promote debate on legal offers (ISOC France - Internet Society France, Pour le Cinéma, La Quadrature du Net, SAMUP - Union des Syndicats des Artistes Interprètes Créateurs et Enseignants de la Musique, de la Danse et de l'Art EDRI-GRAM. The French Constitutional Council censures the 3 strikes law. In: EDRI-Gram, 2009, no. 7.12. http://www.edri.org/edri-gram/number7.12/3-strikes-censured-council-constitutional Last consulted on July 8th, 2009. 66 OLIVENNES (D.). Agreement for the development and protection of cultural works and programmes on the new networks (TRANSLATION). Paris, Ministry of Culture and Communication, 2007, pp. 1-2. http://www.culture.gouv.fr/culture/actualites/dossiers/internet-creation08/Accords_%20Version_anglaise.pdf Last consulted on July 9th, 2009. 67 GENERATION SCIENCE-FICTION. Qui contrôlera le futur? On: Génération Science-Fiction, April 25th, 2009. http://generationscience-fiction.hautetfort.com/archive/2009/04/25/qui-controlera-le-futur.html Last consulted on July 8th, 2009. 68 NUMERAMA. Soirée-Concert “HADOPI mʼa tuer” le lundi 15 juin à Paris. On: Numerama, May 26th, 2009. http://www.numerama.com/magazine/12998-Soiree-Concert-Hadopi-m-a-Tuer-le-lundi-15-juin-a-Paris.html Last consulted on July 8th, 2009. 69 OLIVENNES (D.). Agreement for the development and protection of cultural works and programmes on the new networks (TRANSLATION). Paris, Ministry of Culture and Communication, 2007, p. 2. http://www.culture.gouv.fr/culture/actualites/dossiers/internet-creation08/Accords_%20Version_anglaise.pdf Last consulted on July 9th, 2009. 19
Dramatique de France, and UFC Que Choisir). They propose issuing a “global license” (an alternative remuneration system where file sharing of copyrighted content is legal and an obligatory monthly flat 70 fee is added to subscribersʼ ISP bill). This idea was also discussed during the French DADVSI law proposal. La Quadrature du Net has composed a non-exhaustive list of various actors who oppose the 71 Creation & Internet bill. Finally, some European institutions have also expressed opinions on the French policy proposal. On 29 May 2009, the Council of Europe passed a Resolution on Internet Governance and Critical Internet Resources, stating that “fundamental rights and Council of Europe standards and values apply to 72 online information and communication services as much as they do to the offline world” . This is interpreted as disapproval of the French policy initiative. Furthermore, the European Parliament has also shown disfavor for the French policy initiative on several occasions. Most recently, in the second reading of the Telecoms Package Review, the Parliament voted for an amendment (138/46) which states that “no restriction may be imposed on the fundamental rights and freedoms of end users, 73 without a prior ruling by the judicial authorities”. Adversely, throughout the Telecoms Package Review, the European Council has pushed hard to pass legislation allowing disconnection of internet access prior to a judicial ruling. Although France has certainly gone the furthest in the “three-strikes” approach, other member states seem to be considering similar schemes. Lastly, in November 2008, the European Commission commented on the French draft law, urging the French authorities to be careful to remain within the limits of the e-Commerce Directive and to take precautionary measures to respect the rights to private life and freedom of information. The Commission also warned about the proportionality of the sanction mechanism, and underscored the importance of the internet and 74 development of legal offers.
Timeline The following table is a timeline of events during the French public policy process concerning online copyright infringement. 23 November 2007
Signature of Elysée Agreement for the Development and Protection of Cultural Works and Programs on the New Networks
29 April 2008
Advice of CNIL on Proposal for Government Bill promoting the Dissemination and Protection of Creative Works on the internet (Creation & Internet)
28 May 2008
Advice of ARCEP on proposal for government bill
12 June 2008
Advice of Council of State on proposal for government bill
18 June 2008
Submission of Government Bill Creation & Internet to Senate
30 October 2008
Adoption of Creation & Internet by Senate (first reading)
7-9 April 2009
Examination of Creation & Internet by Joint Commission
70
CREATION PUBLIC INTERNET. Création Public Internet. http://www.creationpublicinternet.fr/blog/index.php Last consulted on July 8th, 2009. 71 LA QUADRATURE DU NET. Contre hadopi. http://www.laquadrature.net/wiki/Contre_hadopi Last consulted on July 8th, 2009. 72 COUNCIL OF EUROPE. Resolution. Internet governance and critical Internet resources. Text adopted during: 1st Council of Europe Conference of Ministers responsible for Media and New Communication Services, Reykjavik, May 28-29th, 2009. 73 EURACTIV. News. Telecoms overhaul blocked over Internet usersʼ rights. On: EurActiv.com, May 7th, 2009. http://www.euractiv.com/en/infosociety/telecoms-overhaul-blocked-internet-users-rights/article-182062 Last consulted on July 8th, 2009. 74 LA TRIBUNE. Loi antipiratage sur Internet: les observations de Bruxelles. On: LaTribune.fr, November 27th, 2008. http://www.latribune.fr/entreprises/communication/telecom-internet/20081127trib000314818/loi-antipiratagesur-internet-les-observations-de-bruxelles-.html Last consulted on July 8th, 2009. 20
9 April 2009
Rejection of Creation & Internet by National Assembly (first reading)
12 May 2009
Adoption of Creation & Internet by National Assembly (second reading)
13 May 2009
Adoption of Creation & Internet by Senate (second reading)
19 May 2009
Appeal to Constitutional Council
10 June 2009
Rejection of Creation & Internet by Constitutional Council
13 June 2009
Promulgation of accepted articles of Creation & Internet government bill
24 June 2009
Examination of new government bill HADOPI 2 by Council of Ministers (government)
9 July 2009
Adoption of HADOPI 2 by Senate
22-24 July 2009
Examination of HADOPI 2 by National Assembly
Autumn 2009
First electronic warning messages due to be sent out
State of affairs On 10 June 2009, the French Constitutional Court ruled sections of the Creation & Internet draft law unconstitutional. In particular, it deemed that sanctions should only be implemented based on a court decision. Thus the High Authority cannot mandate the suspension of internet access. The accepted parts of the government bill have been promulgated, and allow a system of warning messages to be set up. Rights holders file a complaint to the High Authority for the dissemination of works and the protection of rights on the internet (HADOPI), which can send warning messages to those subscribers who are likely to have failed to respect the law. The first message constitutes “a recommendation by email”, the second “a recommendation by letter with acknowledgment of receipt”. Internet service providers that fail to pass on the warning messages, can be fined. They are also obliged to inform their subscribers of “the existence of technical systems allowing them to guard against fraudulent use of the 75 internet access”. The first warning messages are due to be sent out in autumn 2009, which means that the further development of legal offers (commitments in the Elysée Agreement) will also be kickstarted. Meanwhile, the Ministry of Culture & Communication has submitted a new government bill on the penal protection of literary & artistic property on the internet (HADOPI 2). The new draft law proposes a simplified judicial procedure to sanction infringers of authorsʼ rights. Agence France Presse reports that the suggested penalties are disconnection of internet access, a fine of up to €300.000, or a twoyear jail sentence. The first government bill Creation & Internet did not include stipulations on fines or jail sentences. Another variation concerns negligent subscribers. The AFP article states that “account holders found guilty of “negligence” for allowing a third party to pirate music or films using their web 76 connection, would risk a €1,500 fine and a month-long suspension.” Furthermore, the new draft law seeks to cover more channels of illicit sharing and suggests that not only infringements through an
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FRENCH MINISTRY OF CULTURE AND COMMUNICATION. Government bill promoting the dissemination of protection of creative works on the internet (TRANSLATION). Paris, Ministry of Culture and Communication, 2008, pp. 5-11. http://www.culture.gouv.fr/culture/actualites/conferen/albanel/creainterenglish.pdf Last consulted on July 9th, 2009. 76 AGENCE FRANCE PRESSE. French Senate adopts rejigged Internet piracy bill. On: Google News, July 9th, 2009. http://www.google.com/hostednews/afp/article/ALeqM5iXma9p6-PTXSVfs9tDTNCIsqQFyQ Last consulted on July 12th, 2009. 21
77
online public communication service, but through any electronic communication means, be punished. Critics believe that “the door is wedged open for widespread surveillance of all 78 Internet communications”. HADOPI 2 was accepted by the Senate on 9 July 2009, and was examined by the National Assembly later in July. The final vote by the National Assembly will be taken in September 2009.
Another relevant French policy proposal is LOPPSI 2 (Loi dʼOrientation et de Programmation pour la Performance de la Sécurité Intérieure 2009), which seeks to increase citizen protection. Among other issues, LOPPSI would further tackle cyber crime, by legalizing government keyloggers and creating 79 blacklists for child pornography sites. In 2008, a police database (EDVIGE - Exploitation Documentaire et Valorisation de l'Information Générale), was created with the purpose of filing “individuals groups, organisations and moral persons which, due to their individual or collective 80 activity, are likely to attempt to public order”. Dubbed “Sarkozyʼs big sister”, the database was 81 withdrawn in December 2008 under heavy French protest. The LOPPSI draft law wishes to set up a similar file and is expected to encounter renewed opposition. FInally, a few parallel developments on the EU level are the Telecoms Review Package (Amendment 138/46), the non-legislative Resolution of the European Parliament on Cultural Industries in Europe (Guy Bono), and the Recommendation of the European Parliament on Strengthening Security and Fundamental Freedoms on the Internet (Stavros Lambrinidis). These policy documents underscore the importance of fundamental rights and state that criminalizing consumers is not the right solution to fight online copyright infringement. They also illustrate how intertwined EU and national legislation have become.
United Kingdom: Digital Britain On 16 June 2009, the department for Culture, Media & Sport (CMS), together with the department for Business, Innovation & Skills (BIS), published the final report of Digital Britain, a product of the British governmentʼs desire to “ensure the UKʼs position as one of the worldʼs leading digital knowledge 82 economies”. The report has a large scope, focusing on areas that have been radically changed by new technology and are crucial for the development of a strong British digital economy. Attention is paid to infrastructure, radio, creative (or content) industry, public service broadcasting, research, education & skills, and government. The five objectives of Digital Britain are to (1) modernize and upgrade the communications infrastructure, (2) provide a favorable climate for investment and innovation in digital content, applications and services, (3) secure a range of high quality public service 77
FRENCH MINISTRY OF CULTURE AND COMMUNICATION. Projet de loi relatif à la protection pénale de la propriété littéraire et artistique sur internet. Paris, Ministry of Culture and Communication, 2009. http://www.legifrance.gouv.fr/html/actualite/actualite_legislative/pl_protection_propriete_artist.html Last consulted on July 9th, 2009. 78 HORTEN (M.). Hadopi 2: a marked negligence? On: IPtegrity.com, July 14th, 2009. http://www.iptegrity.com/index.php?option=com_content&task=view&id=373&Itemid=9 Last consulted on July 20th, 2009. 79 ANDERSON (N.). Next up for France: police keyloggers and Web censorship. On: ArsTechnica.com, May 19th, 2009. http://arstechnica.com/tech-policy/news/2009/05/next-up-for-france-police-keyloggers-and-webcensorship.ars Last consulted on July 20th, 2009. FRENCH MINISTRY OF INTERIOR, OVERSEAS AND AUTONOMOUS REGIONS. Dossier de Presse. Projet de loi dʼorientation et de programmation pour la performance de la Sécurité intérieure. http://www.interieur.gouv.fr/sections/a_la_une/toute_l_actualite/securiteinterieure/loppsi/downloadFile/attachedFile/dossier_presse_LOPPSI.pdf?nocache=1243419416.25 Last consulted on July 9th, 2009. 80 EDRI-GRAM. France: No to new EDVIGE! In: EDRI-GRAM, 2009, no. 7.13. http://www.edri.org/edrigram/number7.13/no-edvige-3 Last consulted on July 9th, 2009. 81 BREMNER (C.). French revolt over Edvige: Nicolas Sarkozyʼs Big Brother spy computer. In: The TImes, September 9th, 2008. http://www.timesonline.co.uk/tol/news/world/europe/article4703054.ece Last consulted on July 9th, 2009. 82 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, p. 7. http://www.culture.gov.uk/images/publications/digitalbritainfinalreport-jun09.pdf Last consulted on July 11th, 2009. 22
content, (4) develop the nationʼs digital skills at all levels, and (5) secure universal access to 83 broadband. The report is a prime example of the new British model of “Industrial Activism”, where government stimulates key areas of growth (such as the digital and content industries) that in turn can strengthen the UKʼs economic position in the future. The focus is on economic growth/recovery and the future. The British Prime Minister, Gordon Brown, made the following statement about Digital Britain: Only a Digital Britain can unlock the imagination and creativity that will secure for use and our children the highly skilled jobs of the future. Only a Digital Britain will secure the wonders of an information revolution that could transform every part of our lives. Only a Digital Britain will 84 enable us to demonstrate the vision and dynamism that we have to shape the future. Prime Minister Brown expressed that an information revolution is taking place. Indeed, the report 85 states that the UK is a “digitally enabled” and “digitally dependent economy and society”. In the chapter “Creative Industries in the Digital World”, the British government expand on their 86 strategy to “make the UK one of the worldʼs main creative capitals” . They contend that many public policy interventions designed for the linear analog world need to be “radically re-cast” for the digital 87 environment. One area for new policy concerns the online content market. They express that the current model of the content industry is not working and believe that this is partially due to unlawful access to digital content. Digital Britain wants to provide a framework where new market models can develop, in part by creating “an enforcement climate that will focus consumers on legal sources of content rather than unlawful ones”. The report proposes that Ofcom, the regulator for UK communications industries, requires ISPs to “notify account holders that their account appears to have been used to infringe copyright”, and to “maintain and make available data to enable the minority of serious repeat infringers to be identified”. It is also suggested that if the notification process doesnʼt reduce file sharing significantly, Ofcom can “place additional measures on ISPs aimed at reducing or preventing online copyright infringement by the application of various technical measures”. Two important premises of Digital Britain are that most consumers would prefer to behave lawfully and that a warning system would reduce unlawful file-sharing by 70-80%. The report also states that 88 “commercially-led solutions remain by far the preferred approach”.
Forerunners The British Gowers Review of Intellectual Property is an independent study published in 2006 that underpins many of the policy discussions concerning copyright and internet in the UK. This Review set out recommendations to make the UK Intellectual Property framework digitally ready. 89 Recommendations 3, 36 & 39 are relevant for our case study on online copyright infringement. Recommendation 3: the European Commission should retain the length of protection on sound recordings and performersʼ rights at 50 years. On 23 April 2009, the European Parliament approved the Commissionʼs proposal to extend copyright protection for performers and record producers from 50 to 70 years. The European Council has not come to an agreement yet. The topic remains controversial, especially as studies (like Gowers) deem 50 years an adequate protection. Proponents argue that the extension is crucial for creativity and innovation, and “a matter of fairness for the many talented performers who contribute to Europeʼs 83
IDEM p. 9. BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, p. 7. http://www.culture.gov.uk/images/publications/digitalbritainfinalreport-jun09.pdf Last consulted on July 11th, 2009. 85 IDEM, p. 8. 86 IDEM, p. 105. 87 IDEM, p. 107. 88 IDEM, pp. 109-113. 89 GOWERS (A.). Gowers Review of Intellectual Property. London, HM Treasury, 2006, pp. 6-9. http://webarchive.nationalarchives.gov.uk/+/http://www.hm-treasury.gov.uk/d/pbr06_gowers_report_755.pdf Last consulted on July 11th, 2009. 23 84
exciting music culture”. Opponents, however, believe that the extension will only help record companies and top-earning artists. They argue for “copyright rules relevant for the digital age, and innovative solutions to ensure that artists and music lovers get the best possible deal, not the middle 90 man”. Better, not longer copyright is needed. Recommendation 36: Match penalties for online and physical copyright infringement by amending section 107 of the CDPA by 2008. Following a consultation concerning penalties for copyright infringement. which was held in 2008, the British government intends to follow Gowersʼs thirty-sixth recommendation and change legislation to 91 increase the penalty for online copyright infringement. Recommendation 39: Observe the industry agreement of protocols for sharing data between ISPs and rights holders to remove and disbar users engaged in ʻpiracyʼ. If this has not proved operationally successful by the end of 2007, Government should consider whether to legislate. In February 2008, three governmental departments (DCMS - Culture, Media & Sport, BIS - Business, 92 Enterprise & Regulatory Reform, and DIUS - Innovations, Universities & Science) published a policy document titled Creative Britain: New Talents for the New Economy, which reiterated Gowersʼs thirtyninth recommendation that the government should consider taking legislative action if the content 93 industry and ISPs couldnʼt reach an agreement on ways to reduce illegal file-sharing. On 24 July 2008, rights holders and internet service providers concluded a Memorandum of Understanding on an Approach to Reduce Unlawful File-sharing. However, experience from the memorandum and a consultation (on legislative options to address illicit peer-to-peer file-sharing) showed the difficulties of an exclusively self-regulatory measure. The lack of legal commitment was an important issue highlighted. Consequently, the Digital Britain Report and the 2009 BIS Consultation on Legislation to Address Peer-to-Peer (P2P) Illicit File-Sharing propose a co-regulatory measure where the government provides the legislative framework to enable bilateral commercial agreements. A self94 regulatory option is still preferred, but considered unlikely. As mentioned in the previous paragraph, the first Consultation on Legislative Options to Address Illicit Peer-to-Peer (P2P) File-Sharing was published at the same time as the memorandum of understanding (24 July 2008). The consultation reflected on five options to reduce online copyright infringement. It also expanded on issues and constraints that need to be taken into consideration when developing regulatory models. The topics discussed were better regulation, enforcement, costs, data protection, liability of ISPs, technology: filtering, technology: identifying the infringer, consumer protection & level of proof, scale, and responsibility. The preferred regulatory solution (co-regulation with a commercial code of practice and Ofcom oversight) became the current proposal, as outlined in 95 Digital Britain and the second consultation.
90
EURACTIV. News. Music copyright still divisive, despite MEPsʼ backing. On: EurActiv.com, April 28th, 2009. http://www.euractiv.com/en/innovation/music-copyright-divisive-despite-meps-backing/article-181703 Last consulted on July 8th, 2009. 91 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, p. 117. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 92 The Departments for Business, Enterprise & Regulatory Reform and for Innovations, Universities & Science merged in June 2009 to form the new Department for Business, Innovation & Skills. 93 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Creative Britain: New Talents for the New Economy. London, Department for Culture, Media and Sport, 2008, 81 p. http://www.culture.gov.uk/images/publications/CEPFeb2008.pdf Last consulted on July 11th, 2009. 94 BRITISH DEPARTMENT FOR BUSINESS, INNOVATION AND SKILLS. Consultation on Legislation to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Innovation and Skills, 2009, pp. 7-9. http://www.berr.gov.uk/files/file51703.pdf Last consulted on July 11th, 2009. 95 BRITISH DEPARTMENT FOR BUSINESS, ENTERPRISE, AND REGULATORY REFORM. Consultation on Legislative Options to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Enterprise and Regulatory Reform, 2008, 66 p. http://www.berr.gov.uk/files/file47139.pdf Last consulted on July 11th, 2009. 24
The Memorandum of Understanding on an Approach to Reduce Unlawful File-Sharing was signed by three governmental departments (DCMS, BIS, and DIUS), the six main British ISPs and telecoms & cable operators (BSkyB, BT - British Telecommunications, Carphone Warehouse, Orange, Tiscali, and Virgin Media), and two rights holders (BPI - British Phonographic Industry, and MPA - Motion Picture 96 Association). The memorandum of understanding identified three areas where action by both rights holders and ISPs were needed: education & awareness, commercial models, and sanctions. Although it became clear that a self-regulatory solution to unlawful file-sharing would be difficult to achieve, the BIS 2009 consultation points out that the investigative work in technical measures, legal issues and 97 the process of notifications helped shape the current proposal. Prior to the memorandum, the BPI 98 and Virgin Media had already conducted a trial to test the effect of letters of caution.
Actors The Secretary of State (or Department) for Sport, Media & Culture authored the Digital Britain report. Shortly after the publication of Digital Britain, the Communications Minister, Lord Carter, made the unexpected announcement that he would leave the government after the Parliamentary summer recess in July for a position in the private sector. The Secretary of State (or Department) for Business, Innovation & Skills (BIS) co-financed the Digital Britain Report. Several accompanying documents, such as the Consultation on Legislation to Address Illicit P2P File-sharing, were authored by BIS. Additionally, the Intellectual Property Office (IPO), part of the Department for Business, Innovation & Skills, was also closely involved with the Digital Britain process. IPO produced an accompanying document to the Digital Britain Interim Report, which 99 reflected on the possible role of a digital rights agency. Moreover, consultations on amendments for copyright exceptions and orphan works also constitute areas of responsibility for IPO. They fit within the greater Copyright Strategy launched in December 2008. Ofcom is the independent regulator and competition authority for the UK communications industries. The 2003 Communications Act states that Ofcomʼs principal duty is to “further the interests of citizens in relation to communication matters”, and “further the interests of consumers in relevant markets, 100 where appropriate by promoting competition”. The current proposal for fighting online copyright infringement gives Ofcom the responsibility to place requirements on ISPs and the power to specify 101 technical measures to be imposed (if the notification process hasnʼt been successful). Furthermore, Ofcom will need to approve (or in the absence of agreement by industry, prepare) a code of practice, stipulating the details of the notification process. In the memorandum of understanding, two main rights holders, the British Phonographic Industry and the Motion Picture Association, agreed to educate consumers in the importance of supporting creators and in the illegality of unlicensed file-sharing, to work together with ISPs to develop a notification process, to identify with Ofcom effective mechanisms to deal with repeat infringers (including technical measures such as network management, filtering and content marking), and to consider prosecuting
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IDEM, pp. 47-48. BRITISH DEPARTMENT FOR BUSINESS, INNOVATION AND SKILLS. Consultation on Legislation to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Innovation and Skills, 2009, p. 8. http://www.berr.gov.uk/files/file51703.pdf Last consulted on July 11th, 2009. 98 BRITISH DEPARTMENT FOR BUSINESS, ENTERPRISE, AND REGULATORY REFORM. Consultation on Legislative Options to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Enterprise and Regulatory Reform, 2008, p. 29. http://www.berr.gov.uk/files/file47139.pdf Last consulted on July 11th, 2009. 99 BRITISH INTELLECTUAL PROPERTY OFFICE. Copyright in a digital world. What role for a Digital Rights Agency? London, Department for Innovation, Universities and Skills, 2009, 29 p. http://www.ipo.gov.uk/digitalbritain.pdf Last consulted on July 11th, 2009. 100 OFCOM. Statutory Duties and Regulatory Principles. http://www.ofcom.org.uk/about/sdrp/ Last consulted on July 11th, 2009. 101 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, p. 113. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 25 97
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particularly serious infringers. Rights holders and ISPs have also been cooperating to offer legal online services. The BBC iPlayer and Spotify are two widely popular legal offers for TV & radio, and music. Quite recently, Virgin Media and Universal Music Group agreed to offer unlimited downloads of the music labelʼs music catalogue to Virgin subscribers. The catch is that VIrgin Media will also 103 implement a graduated response system and temporarily suspend the accounts of repeat infringers. In the memorandum of understanding, internet service providers and telecoms & cable operators agreed to work together with rights holders to educate consumers, to work together with rights holders to develop a notification process, and to identify with Ofcom effective mechanisms to deal with repeat 104 infringers. The current legislative proposal set out in Digital Britain focuses strongly on ISPs, requiring their cooperation. British ISPs (with an apparent exception of Virgin Media) have been reluctant to cooperate on a voluntary basis, as it can result in a competitive disadvantage for participating ISPs. The need to observe the e-Commerce Directive and potential issues with fundamental rights have been additional reasons for lack of enthusiasm. In an expert interview, Monica Horten rightly pointed out that a distinction should be made between small and large ISPs/network operators. She argues that small ISPs are a more recent phenomenon and consequently have always known competition. They were born in the digital age and seem to be greater supporters of fundamental digital & civil rights. Conversely, large ISPs are often former incumbents and only now know competition. They seem to be more concerned about business arguments related to copyright 105 and internet. Indeed, British Telecommunications (BT) is known to throttle P2P connections, heavy users, and video streaming services under certain plans. Its “Fair Usage Policy” which stipulates how 106 this network management works, seems reasonable. However, after being accused by the BBC of throttling the BBC iPlayer, BT called for an end to the “free rides” that video streaming services were enjoying. The ISP contended that certain content providers were developing “very profitable business 107 models”, at the expense of the network provider. BTʼs actions would seem to confirm Monica Hortenʼs argument about business interests and they raise interesting questions about network neutrality. A last group of stakeholders considered crucial to engage in the fight against copyright infringement is consumers. In its chapter on “Creative Industries in the Digital World”, the Digital Britain Report stipulates the importance of meeting the interests of creators, aggregators, distributors AND 108 consumers. The government disapproves of online copyright infringement, but believes that most 109 consumers would choose not to infringe if given easy, affordable and alternative offers. Additionally, Digital Britain confirms the governmentʼs intention to secure universal access to broadband by 2012, and expands on the necessity of developing the nationʼs digital skills. Moreover, Digital Britain also
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BRITISH DEPARTMENT FOR BUSINESS, ENTERPRISE, AND REGULATORY REFORM. Consultation on Legislative Options to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Enterprise and Regulatory Reform, 2008, pp. 47-48. http://www.berr.gov.uk/files/file47139.pdf Last consulted on July 11th, 2009. 103 CHENG (J.). ISP, UMG agree on unlimited music plan, graduated response. On: ArsTechnica.com, June 15th, 2009. http://arstechnica.com/media/news/2009/06/isp-umg-agree-on-unlimited-music-plan-graduatedresponse.ars Last consulted on July 10th, 2009. 104 BRITISH DEPARTMENT FOR BUSINESS, ENTERPRISE, AND REGULATORY REFORM. Consultation on Legislative Options to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Enterprise and Regulatory Reform, 2008, pp. 47-48. http://www.berr.gov.uk/files/file47139.pdf Last consulted on July 11th, 2009. 105 HORTEN (M.). July 3rd, 2009. See appendix 6: p. 164. 106 BRITISH TELECOMMUNICATIONS. BT Total Broadband Fair Usage Policy. http://bt.custhelp.com/cgibin/bt.cfg/php/enduser/cci/bt_adp.php?p_faqid=10495&cat_lvl1=346&p_cv=1.346&p_cats=346 Last consulted on July 10th, 2009. 107 BRADSHAW (T.). BT seeks to end ʻfree rideʼ by video websites. On: FinancialTimes.com, June 11th, 2009. http://www.ft.com/cms/s/0/1c979154-5621-11de-ab7e-00144feabdc0.html Last consulted on July 10th, 2009. 108 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, p. 108. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 109 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, p. 110. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 26
gave interest groups the opportunity to respond by publishing an Interim report in January 2009. This resulted in 250+ written responses, 500+ bilateral engagements, online forums, and volunteer110 organized events. Still, consumer organizations arenʼt quite happy about the report. Consumer Focus appreciates the governmentʼs commitment to universal broadband and digital participation, but believes that “issues of illegal downloading are still essentially left for the industry to police, albeit, 111 under Ofcomʼs supervision”. The British Open Rights Group is especially critical of the technical measures that can be put in place by Ofcom (without court decision!) and regrets ”the proposed blurring of Ofcomʼs role, supposedly to protect competition and the public interest, to one of altering market access and conditions in favour of incumbent players”. The group foresees damages to 112 internet openness and human rights. Lastly, it should be remarked that only one consumer organization (Consumer Focus) was involved in the preparation of the consultations on Legislative 113 Options/Legislation to Address Illicit Peer-to-Peer (P2P) File-Sharing.
Timeline The following table is a timeline of events during the British public policy process concerning online copyright infringement. It illustrates the acceleration of the policy process in 2008 and also mentions the main governmental actors involved. 6 December 2006
Publication of Gowers Review of Intellectual Property
22 February 2008
Publication of Document on Creative Britain: New Talents for the New Economy by DCMS with BERR & DIUS
24 July 2008
Publication of Consultation on Legislative Options to Address Illicit P2P File-Sharing by BERR
24 July 2008
Signature of Memorandum of Understanding on an Approach to Reduce Unlawful File-Sharing
16 December 2008
Publication of Issues Paper on © The Future: Developing a Copyright Agenda for the 21st Century (Copyright Strategy) by IPO
29 January 2009
Publication of Digital Britain Interim Report by DCMS with BIS
29 January 2009
Publication of Document on Copyright in a Digital World. What Role for a Digital Rights Agency? by IPO
16 June 2009
Publication of Digital Britain Final Report by DCMS with BIS
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IDEM, p. 9. CONSUMER FOCUS. News. Consumer Focus responds to Digital Britain report. On: ConsumerFocus.org, June 16th, 2009. http://www.consumerfocus.org.uk/en/content/cms/news___press_speech/digitalbritainrespon/digitalbritainrespon. aspx Last consulted on July 10th, 2009. 112 KILLOCK (J.). Digital Britain: closing down the open internet. On: OpenRightsGroup.org, June 17th, 2009. http://www.openrightsgroup.org/2009/06/digital-britain-closing-down-the-open-internet/ Last consulted on July 10th, 2009. 113 BRITISH DEPARTMENT FOR BUSINESS, ENTERPRISE, AND REGULATORY REFORM. Consultation on Legislative Options to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Enterprise and Regulatory Reform, 2008, p. 42. http://www.berr.gov.uk/files/file47139.pdf Last consulted on July 11th, 2009. 111
BRITISH DEPARTMENT FOR BUSINESS, INNOVATION AND SKILLS. Consultation on Legislation to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Innovation and Skills, 2009, p. 33. http://www.berr.gov.uk/files/file51703.pdf Last consulted on July 11th, 2009. 27
16 June 2009
Publication of Consultation on Legislation to Address Illicit P2P File-sharing by BIS
15 September 2009
Closure of Consultation on Legislation to Address Illicit P2P Filesharing by BIS
15 December 2009
Publication of Government Response Document
State of affairs The BIS Consultation on Legislation to Address Illicit P2P File-sharing and the IPO Copyright Agenda are currently ongoing. The policy proposal set out in the BIS Consultation and Digital Britain, builds on the findings from the Memorandum of Understanding, the 2008 BERR Consultation, the Digital Britain Interim Report and the IPO Document on the Role of a Digital Rights Agency. It proposes giving Ofcom the duty to place requirements on ISPs to (1) “notify account holders that their account appears to have been used to infringe copyright”, and (2) “maintain and make available data to enable the minority of serious repeat infringers to be identified”. The industry is asked to draft a code of practice, describing these two obligations. It is also suggested that an industry digital rights agency be formed, with the aim of making government intervention minimal. Additionally, the current proposal gives Ofcom backstop powers to mandate ISPs to (3) apply various technical measures: blocking (site, IP, URL, protocol or port), bandwidth capping & shaping, content identification, and/or filtering. These backstop powers would only be triggered if the notification process, execution of legal action, and educational & commercial developments hadnʼt reduced infringement by 70% of the 114 people notified after one year. However, this graduated response mechanism is only one of the ways in which the UK government wishes to encourage the content industry. The IPO Copyright Strategy, launched in December 2008, endeavors to make the UK copyright system digitally ready; looking at topics such as how to modernize licensing, which copyright exceptions need to be made (private copying is prohibited in the UK), rights clearance, and more. Furthermore, in the introduction, I already mentioned Digital Britainʼs intention to match penalties for online and physical copyright infringement (Gowers Recommendation 36). Digital Britain also reflects on alternative funding mechanisms for digital content, the setup of digital testbeds where industry can trial new products & business models, and the extension of existing 115 interventions (such as culture tax relief for film) to interactive content. Due to compulsory line sharing, the UK has a competitive telecoms market. BTʼs “Fair Usage Policy” (throttling heavy users, P2P connections and video streams) is lawful, because internet users can easily switch providers. However, it does seem that the ISP took one step too far in experimenting with the behavioral advertising technology “Phorm”. This technology analyzes usersʼ web surfing and delivers targeted advertising when they visit certain websites. Some of BTʼs trials were done without usersʼ consent and resulted in numerous complaints. In April 2009, the European Commission opened an infringement proceeding against the UK about the implementation of EU e-Privacy and personal data protection rules. The Commission is particularly concerned about the ambiguity of British law on
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BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, pp. 109-113. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 115 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, pp. 114-134. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 28
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interception of communications. Another item of interest on the EU level is the Telecoms Package Review. During the last European Council on 11 June 2009, the majority of EU member states stated that amendment 138/46, which stipulates that judicial review is needed to impose restrictions on fundamental rights and freedoms of end users, is unacceptable. Some member states expressed that it potentially interfered with national competencies, and the UK noted that it could constrain future 117 decisions of their government. It is indeed questionable if Ofcomʼs backstop powers to impose “technical measures” would be considered permissible under amendment 138/64.
Comparative analysis Conclusion In this section we come to some conclusions and we discuss the similarities and differences between the French and British case studies. We will compare the policy proposals on their setup, focus & premises, memorandums of understanding, views on DRM & internet filtering, and their relation to other documents. Both the French and British policy initiatives aim for a mix of legislative and voluntary measures to fight online copyright infringement. The UK government waited to intervene, hoping for a commercial solution, but has realized that legal underpinning is needed to instigate industry cooperation. The French proposal is more government-driven, which is reflected in the setup of the administrative authority HADOPI. The UK prefers the setup of an industrial digital rights agency. Both initiatives suggest implementing a warning and sanction mechanism to deter copyright infringement. Penalties would require judicial review. In the course of events, it has been particularly remarkable to observe how the French proposal for sanctions has been weakened, while the British proposal has been strengthened. The “three-strikes” aspect of the French law proposal received much criticism and was eventually shot down by the Constitutional Court. The current British policy proposal suggests giving Ofcom (not a judge!) the power to impose technical measures if the notification process fails. Additionally, Universal Music Group (rights holder) and Virgin Media (ISP) reached a voluntary agreement to implement a “three-strikes” policy in return for unlimited access to UMGʼs music catalog. Of course, we do need to take into account that the British initiative is at an earlier stage of development. Proposals for legislation are only now being drafted in the UK, while a first set of legislation has already been promulgated in France. The French government bill Creation & Internet focuses on “the drain of cultural works on the internet” and sketches a doom scenario if action isnʼt taken. The British initiative, on the other hand, is part of Digital Britain, which has a much larger scope. Its focus is on digital economic growth and the future. In other words thet Creation & Internet is a reactive measure, while Digital Britain is proactive. Several premises underpin both policy proposals. First, they believe that internet and ICT have incited great change. Second, France and the UK see peer-to-peer file-sharing as a major contributor to the failure of business models in the content industry. Third, both warning mechanisms are based on the presumption that 70 to 90% of internet users will alter their illicit behavior if notified. Interestingly, the BIS 2009 Consultation on P2P File-sharing expresses that the results from surveys measuring this change in behavior differ greatly. A very recent survey commissioned by the British Phonographic Industry indicates that (only) 33% of file-sharers “would stop if they received a notification, with a further 28% saying they would do ʻmuch less sharingʼ. A hard core of 21% said they would carry on as 118 before.” Lastly, both governments contend that consumers donʼt understand copyright and would change, if provided with education and attractive legal offers. We however question if the upcoming generation of consumers will really switch back to legal alternatives. The “culture of acceptance” that downloading creative content for free is okay may be too deeply rooted. 116
EUROPEAN UNION. IP/09/570. Telecoms: Commission launches case against UK over privacy and personal data protection. April 14th, 2009. http://europa.eu/rapid/pressReleasesAction.do?reference=IP/09/570&format=HTML&aged=0&language=EN&guiL anguage=en Last consulted on July 11th, 2009. 117 BRITISH MINISTER FOR COMMUNICATIONS, TECHNOLOGY & BROADCASTING. Written Statements. EU: Telecoms Council. http://www.publications.parliament.uk/pa/ld200809/ldhansrd/text/90617wms0001.htm#09061794000035 Last consulted on July 11th, 2009. 118 BRITISH DEPARTMENT FOR BUSINESS, INNOVATION AND SKILLS. Consultation on Legislation to Address Illicit Peer-to-Peer (P2P) File-sharing. London, Department for Business, Innovation and Skills, 2009, p. 35. http://www.berr.gov.uk/files/file51703.pdf Last consulted on July 11th, 2009. 29
The policy proposal outlined in Digital Britain is the culmination of multiple consultations and reports. The French government bill builds on less. In fact, the European Commission criticized France for 119 arguing that P2P file-sharing has caused a decrease in music sales without providing evidence. Commonality between the proposals, however, can be found in their memorandums of understanding. Both memorandums formed the basis for the current proposals and also bear similarities in their setup. They focus mainly on the warning & sanction mechanism, and experimentation with filtering technology. The French memorandum also includes legal offers. It is disconcerting that the legislative proposals concentrate on the notification process and leave other measures, such as education and legal offers, subject to far less binding memorandums. Some comfort can be found in the French governmentʼs expectation that once the warning mechanism is effectively operating, the content industry will “align the opening of the video-on-demand window with the physical-video window” and make their catalogues of French music available DRM-free. Additionally, the British governmentʼs proposal indicates that technical measures will only be triggered if the notification process, execution of legal action, and educational & commercial developments have failed to significantly reduce infringement. Both proposals mention filtering technologies. This in itself is a sign that technology is on the agenda. The UK provides a specific list of technical measures that could be imposed by Ofcom: “Blocking (Site, IP, URL), Protocol Blocking, Port Blocking, Bandwidth capping (capping the speed of a subscriberʼs Internet connection and/or capping the volume of data traffic which a subscriber can access); Bandwidth shaping (limiting the speed of a subscriberʼs access to selected protocols/services and/or capping the volume of data to selected protocols/services); Content identification and filtering - Or a 120 combination of these measures”. The French memorandum mentions experimenting with filtering technologies on networks, extending the use of “efficient” fingerprinting & watermarking technologies, and establishing fingerprint reference catalogs. In both policy proposals, internet filtering would be implemented for mainly restrictive purposes. The French case study is worrying, because experimentation with filtering technologies is left to the industry. Additionally, the technical service providers committed to “deploy them if the results are convincing and if their general application would 121 be technically and financially realistic”. ISPs could potentially become internet police. The British case study portrays the technical measures as established and efficient means of protecting content. The government will have to pay attention to consider both the advantages and drawbacks of these technologies. Concerning views on digital rights management, it is remarkable that HADOPI will be replacing ARMT, an administrative authority charged with the task of regulating technical measures. HADOPIʼs missions of protecting works on the internet, monitoring their illegal use & the development of legal offers, and regulating technological identification & protection measures, are considered complimentary. Digital Britain considers it crucial that the publishing industry learns from the 122 experiences in other industries, mentioning the importance of interoperable DRM. Finally, it is clear that Creation & Internet and Digital Britain are not stand-alone documents. France has submitted a law proposal concerning internal security (which includes cyber crime - LOPPSI 2); the UK has an ongoing study concerning the countryʼs copyright strategy. There are also relations to documents on the EU level. The Telecoms Package Review has been discussed multiple times. Both
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LA TRIBUNE. Loi antipiratage sur Internet: les observations de Bruxelles. On: LaTribune.fr, November 27th, 2008. http://www.latribune.fr/entreprises/communication/telecom-internet/20081127trib000314818/loi-antipiratagesur-internet-les-observations-de-bruxelles-.html Last consulted on July 8th, 2009. 120 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, p. 111. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 121 OLIVENNES (D.). Agreement for the development and protection of cultural works and programmes on the new networks (TRANSLATION). Paris, Ministry of Culture and Communication, 2007, p. 2. http://www.culture.gouv.fr/culture/actualites/dossiers/internet-creation08/Accords_%20Version_anglaise.pdf Last consulted on July 9th, 2009. 122 BRITISH DEPARTMENT FOR CULTURE, MEDIA AND SPORT. Digital Britain. Final Report. London, Department for Culture, Media and Sport, 2009, pp. 132-133. http://www.culture.gov.uk/images/publications/digitalbritain-finalreport-jun09.pdf Last consulted on July 11th, 2009. 30
member states oppose Amendment 138/46 because it potentially interferes with their policy proposals. In reaction to the negative advice of the French Constitutional Council, EU Information Society Commissioner, Viviane Redingʼs spokesperson shared that the Council decision confirmed the 123 Commissionerʼs belief that intellectual property rights issues can be settled on national level. Reding is eager to see the controversial amendment 138/46 resolved and the Telecoms Package passed. Furthermore, it is notable that Digital Britain seems more in line with the European approach. The policy proposal is part of a wider discussion on reforming the creative content industry. The 2008 Creative Content Online Consultation dealt not only with legal offers & piracy, but also interoperability of digital rights management and multi-territory rights licensing. Additionally, Reding very recently revealed the Commissionʼs strategy for a Digital Europe. The strategy aims at economic recovery and 124 the transformation of Europe into a knowledge-based society. Interestingly, although the British policy initiative has a more outward focus, thus far the French initiative (due to the “three-strikes” aspect) has attracted more international attention. Although both France and Britain proceed with their initiatives on graduated response the positions taken in the Creative Content Online Consultation clearly show that these initiatives meet with diverging reactions. They are supported by some segments of industry, especially related to content production, but are contested by other segments of industry and by consumer organisations. Although we have not analysed the contributions of individual citizens a brief look at them shows that most citizens object to any form of graduated respons and filtering. The result of the Creative Content Online Consultation is rather dissappointing. Although in total 599 organisations and individuals have made sometimes very elaborate contributions the Commissions report is vague and only a few pages long. Concerning online copyright infringement, the report states that “no consensus on remedies” was found and that it appears “difficult at this point in time to strike the right balance between all interests 125 involved”. As Euractiv has indicated the Commission seems to have shelved its plans to curb piracy. The result might be that graduated respons is left to individual countries, with some countries adopting the model and some not depending on the strenght of content industries within those countries. In this respect it should not come as a surprise that especially France and the UK are leading.
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EURACTIV. News. French ruling raises hopes for EU telecoms deal. On: EurActiv.com, June 11th, 2009. http://www.euractiv.com/en/infosociety/french-ruling-raises-hopes-eu-telecoms-deal/article-183124 Last consulted on July 12th, 2009. 124 REDING (V.). Digital Europe - Europeʼs fast track to economic recovery. Speech presented during: Lisbon Council, Brussels, July 9th, 2009. http://europa.eu/rapid/pressReleasesAction.do?reference=SPEECH/09/336&format=HTML&aged=0&language=E N&guiLanguage=en Last consulted on July 12th, 2009. 125 EUROPEAN COMMISSION. Final Report on the Content Online Platform. May 2009, p.1. http://ec.europa.eu/avpolicy/docs/other_actions/col_platform_report.pdf Last consulted on July 13th, 2009. 125 IDEM, p. 4 31
