Future of Digital Economy Act
Previous Blog home Future of Digital Economy Act ‘in limbo’ until next year, say lawyersDivisive government plans to crackdown on illicit filesharing dealt blow in court – but lawyers say win is just an ‘adjunct’ to wider campaign against act
Share9 Comments (9)
The house of commons during a reading of the digital economy bill, April 2010
The Digital Economy Act, which has divided creative industries since its first inception, has hit what may turn into a considerable stumbling block.
Following a five-hour hearing at London’s high court on Wednesday, Mr Justice Wyn Williams granted a judicial review of the act and its proposals at the behest of two of the UK’s largest broadband providers, BT and TalkTalk. The act, which came into force in June, hangs “in a state of limbo” until the February hearing, BT says.
Speaking to the Guardian after the announcement, Andrew Heaney, an executive director at TalkTalk, called the ruling a “three-nil victory”. He added that “questions remain” over the implementation of the act, the most contentious aspects of which are due to come into force early next year.
“We wouldn’t have put this argument forward if we didn’t think there was a case to answer on this, and neither would the government,” he said. “But I think the government should seriously consider how it takes this legislation forward.
“The judge is saying there’s an arguable case against the implementation [of the act]. He heard both sides and fairly quickly came to the view that there was a case to answer. From that perspective we went into today not knowing what we could have got and we got a good result. I think they call it a good day in court.”
Simon Milner, BT’s director of group industry policy, said he was “very pleased” with the result, which represents a sizeable dent in the proposals as piloted by Lord Mandelson under the previous Labour government.
“We started this because we thought there was uncertainty about the law and the judge agreed with us. From our point of view this couldn’t have gone better,” he told the Guardian after the hearing.
The ISPs and the legislation are left “in a state of limbo” until the hearing of the review, expected at the high court in February, Milner said.
“The judge appeared to agree with the the heart of our case, that the last government – not the current administration – rushed this through in a really inappropriate manner given how controversial this was. We think the court will decide because of that, the law is unenforceable so we’ll wait to see if we’re right.”
Asked what BT expects will happen to the legislation during this “state of limbo”, Milner replied: “That’s not for us to decide, that’s for ministers to decide. We do think it would be rather odd for ministers to proceed as if the court case didn’t happen today though – that would be a bit of a slap in the face for our customers.”
Ofcom has indicated that it will go ahead with planning for the implementation, on the basis that the injunction granted this week is not a repeal, and that it should be ready to implement its work right away if the judicial review sides with the government. But the telecoms heavyweights could apply for an interim injunction on the act, which would stave off any implementation until the results of the judicial review are announced.
Privately, though, lawyers familiar with the proceedings suspect BT and TalkTalk don’t rate their chances of an injunction being granted, and that the review is little more than an adjunct to the pair’s campaign against the act.
One lawyer told me: “The important thing is that this case keeps going in the background to give a feeling of legal pressure backing the political pressure on the government to change direction over the next few months.
“It could actually detract from that campaigning purpose if they ask for the hearing to be expedited, so I don’t suspect they will.”
Some rights holders, including the Motion Picture Association (MPA) and the British Phonographic Industry (BPI), suggest BT and TalkTalk’s argument around the potential harm to “basic rights and freedoms” of internet users is little more than a ruse to protect their financial interests and market share.
Chris Marcich, managing director of the MPA, said in a punchy statement: “The pursuit of this claim by BT/TalkTalk appears to be an attempt to avoid or delay playing their rightful part in tackling online piracy, and instead to continue maximising profit by continuing to make money from broadband traffic generated in part by the downloading of illegal content taken from rights holders without permission.”
The high court will on Friday decide whether BT and TalkTalk have succeeded in challenging the Digital Economy Act on the fourth and final ground. Described by lawyers following the case as “clearly their weakest” point, the ISPs argue that the act goes too far in restricting cross-border services, privacy and free expression.
The government, arguing its best case for legislation harried through by the previous administration, believes it will chalk one back on BT and TalkTalk’s “three-nil victory”.
PRS royalty revenues rise to £623m
The organisation which represents 65,000 songwriters, composers and music publishers has announced a 2.6% rise in revenues after digital music growth offset the decline in traditional CD and DVD formats for the first time.
PRS for Music, a not-for-profit body which ensures creators are paid whenever their music is played, performed or reproduced, reported royalty revenues of £623 million in 2009, up from £608.3 million a year earlier.
It said tougher trading conditions in the UK music market were offset by strong growth internationally and by the licensing of new digital services.
Online revenues grew £12.8 million or 72.7% to £30.4 million, outperforming the decline in traditional CDs and DVDs – off £8.7 million – for the first time.
PRS for Music chief executive Robert Ashcroft said it was still too early to say whether this represented a turning point for the industry.
He added: “The next decade does however promise further growth in earnings from the legal digital market as well as the use of British music overseas.”
The growth in online revenues reflects a series of licence agreements, including MySpace Music, YouTube and iTunes. At the same time, revenues from mobile phone ringtones more than halved to £2.5 million last year.
The significant increase in revenues from British music use abroad – up 19.4% to £166.9 million – reflected exchange rate gains and increased licensing activity in new and existing territories.
Public performance revenues, including clubs, music venues and commercial premises, increased by 2.4%. Despite an estimated 39 pubs closing each week, PRS said it had seen only a small reduction in revenues from pubs as most saw music as an integral part of their business.
PRS members receive nearly 90% of the revenues collected by the organisation. It collects set lists from more than 7,000 music venues each year to ensure members are accurately paid for their performances, as well as ensuring royalties for music played on all UK TV and radio stations.
Copyright © 2010 The Press Association. All rights reserved
Music Copyright and the Internet
Big Subject, contributions welcome. The way I see it, the music industry as we know it is in its final lap. There will very little money to be made in the recording industry in the coming decade. Live Music will be the only form of music that will bring financial returns. The Radio industry will keep it going for sometime but that will not be able to sustain the industry in its present form. The large publishers and record companies will not be able to sustain themselves in the present form. Most hit songs and number ones will be independent and will most likey come out from bedrooms of musicians by 2020.
