New Initiatives by the European Commission and UK June 1, 2010
Posted by Bill Jones in Economics, Europe, Law, UK.add a comment
The Copyright and Enforcement Directorate of the UK’s Intellectual Property Office has reported on two new EU developments in a broadcast email. Since I can’t find the URL for the Directorate [I can't either - ed], I’m left to summarize:
The European Commission has published two recent papers which will impact on our industry:
A New Strategy for the Single Market: This report addresses the challenges to the single market. The report comments on the ill-adapted IP legislation as a barrier to economic progress. It also recognizes that low-cost and legally secure protection of IPRs is of great importance.
The paper proposes, inter alia:
- An EU-wide copyright law, including an EU framework for copyright clearance and management;
- Harmonized copyright levies on blank media and equipment (to simplify the business environment); and
- Adoption of the EU-wide patent and a single patent jurisdiction as a matter of urgency.
A Digital Agenda for Europe: This first initiative is under the Commission’s flagship “Europe 2020” economic program and its main Telecoms and Copyright strategy document.
The text is very wide ranging. The Paper considers transactions in the digital environment to be too complex, with inconsistent implementation of the rules across member states.
It concludes that the EU needs to enhance the protection against online violations of intellectual property rights.
Intellectual Property-related key points in the Digital Agenda include:
- A commitment on reforming governance of collecting societies, and a new initiative to look into cross-border licensing.
- A commitment to orphan works legislation, and looking into out-of-print works
- A commitment to evaluate (not revise) the EU E-commerce Directive this year; and
- A commitment to strengthening Europeana, the European digital library.
Meanwhile, UK’s telecommunications regulator Ofcom has published its consultation on its draft code of practice to reduce online copyright infringement as part of its new duties under the Digital Economy Act 2010: Online Infringement of Copyright and the Digital Economy Act 2010.
As austerity bites, many European countries have to reduce government expenditure as a proportion of GDP – some have started already. Figures in the range of 5% to 10% of GDP are bandied around. These will bite very deeply into initiatives, delivery and operations. Individual departments and agencies could well be subjected to reductions of 25%.
One also can’t see the EU escaping this development since it is funded to the extent of approx 1.24% of the Union’s gross national income (GNI), by individual countries (0.73% of their GNI), duties charged on imports from non-EU states, and a VAT component.
So while all the above initiatives are reality, one wonders what effect these austerity measures will have on them over time.
Bill Jones is CEO of Global Village Ltd.
GAO Report Throws Doubts on Piracy Studies April 14, 2010
Posted by Bill Rosenblatt in Economics, United States.2 comments
The non-partisan Government Accountability Office released a report on Monday addressing the economic impact of intellectual property piracy on the U.S. economy. While the report agrees that IP piracy is a problem with substantial negative economic impact, it discredits several studies that have attempted to quantify such impact, including some that have been widely publicized.
The GAO created this report as a directive of the Prioritizing Resources and Organization for Intellectual Property (PRO-IP) Act of 2008. It examined several studies (listed in the report’s bibliography) that have attempted to quantify losses due to IP piracy, which includes counterfeit physical goods in addition to unauthorized copies of digital material. Among those studies are:
- The Business Software Alliance’s 2008 study on software piracy, which claimed over US $9 Billion in losses
- A 2006 MPAA-sponsored study on movie piracy, which claimed more than $6 Billion in losses
- The 2007 academic study on the effect of music file-sharing by Felix Oberholzer-Gee and Koleman Strumpf, which attempted to discredit RIAA piracy figures and thus was widely cited by the copyleft community
This report criticizes these studies — as well as many others that focus primarily on counterfeited physical goods — for their weak methodologies, lack of hard data, and over-reliance on unsubstantiated assumptions.
I’ve seen a number of these studies and have been consistently disappointed in them for these same reasons — plus the fact that some of them come from obviously biased sources.
The GAO’s conclusion is that piracy is, in fact, bad for the US economy, but it’s extremely difficult to quantify just how bad. There is a dire need for studies that are quantitatively sound and that inspire broad confidence; this GAO report confirms my suspicion that such studies do not — and perhaps cannot — exist.
This does not bode well for the field of digital rights technologies. If no one really knows how big the piracy problem is, then it’s not possible to measure the effectiveness of digital rights technology in reducing piracy (as opposed to its effectiveness for other purposes, such as platform lock-in, enablement of new content business models, or restriction of user experience). And if no one knows how much the effect on piracy is, then no one will have an idea of how much those technologies are worth and who should pay for them.
The GAO is well-respected for its rigor and lack of bias. Will its assessment be the last word in trying to determine the all-important question of quantifiability of the effects of anti-piracy technologies? I hope not — though while I’m not an economist, I understand there’s a reason why the field is known as “the dismal science.”
Bill Rosenblatt
Azita Arvani
Bill Jones
Niels Thorwirth
