CORDIS Archive
This page has been archived. It will no longer be updated.
What happens to intellectual property when it is attached to works distributed in a digital form?
The new digital environment which is enabling the emergence of the Information Society is dramatically changing the economics of content generation and provision. The Internet is one gigantic copying machine. All copyrighted works can now be digitised and, once put on the Net or on any particular off-line medium, copying tends to be effortless, costless, widespread and immediate. In the past, copying intellectual works was time consuming and resulted in inferior reproduction of the original material. Digital technology has changed this: copying is straight-forward and the quality of copies is as good as the original. The idea that intellectual property in a digital environment can lose its value is of great concern to owners and creators. At the same time, the consumer expects that digital technology will bring an added value in terms of usage and quality of information. Ease of use and free access to high value material represent important issues to gain consumers' acceptance. A balance between owners'concerns and consumers'expectations must be found to ensure mutual trust.
While the primary objective of copyright laws was the widespread distribution of ideas , these ideas are driven into the public domain through the profit motive. Intellectual property represents a huge business where many modern products sell, not for what the physical object costs to make , but for a price that reflects heavy research costs, ingenious ideas or creative content. The revenues generated by Intellectual Property are threatened by this new environment. It has been estimated that a large part of the global market in software packages used on PCs is pirated . The International Federation of the Phonographic Industry (IFPI) reckons that one in five sales of recorded music is pirated ; and in the case of CDs, one in three . Whatever the pros and cons of piracy, and tolerating its existence can even be a powerful marketing tool, the fact is that the lost market is huge and expanding in the digital age.
There are no straight-forward solutions to this problem . Technological mechanisms are being developed and implemented to prevent unauthorised use of digital copyrighted information, but such mechanisms must comply with the legal environment in which they will operate, often not adapted to what the technology can do. Furthermore, the diversity of the legal environments makes it difficult, if not impossible, to implement such applications at a global level and even within the Member States of the European Union. This adds to the existing difficulty of defining "interoperable" and "compatible" technical systems enabling global services in the Global Information Society.
In addition to these concerns, the implementation of "Electronic Copyright Management Systems" (ECMS) will have a social and societal impact. The ECMS concept will modify consumers' behaviour, will influence the way citizens access and use digital information and raise ethical issues. This deals with notions such as universalityof access of information , protection of certain categories of user, privileged or free access to certain information by certain categories of persons (students, teachers, jobless, elderly, etc.), privacy, etc. which provide the human dimension of society. These notions, which will influence the implementation of ECMS, need to be addressed at the policy level.
The situation in the field of digitally marketable contents is characterised by 5 inter-related levels and one on-going revolution.
5 interrelated levels:
· A complex set of players, ranging from authors, content-producers, content-owners, publishers, distributors, to service providers, technology suppliers, consumer electronics manufacturers, telecommunications operators, retailers, also including the actors involved in the funding mechanisms such as advertisers, or the actors whose task is to safeguard and make available the cultural heritage, such as libraries, archives and museums, and, last but not least, consumers and citizens. Each category of players has its own concerns, its own legitimate interests which have to be understood in a very broad sense as, in most cases, the concerns of one category of players go far beyond the legitimate defence of their economic interests. . It is vital that all the players in the content field should contribute to overall social objectives as well as to those involved in future developments in content provision.
· A complex and very diverse set of media: diverse with regard to their core content (text, text/images, still images of many kinds, moving images, music, animation, 3D-models) but also with regard to their distribution mechanisms (broadcast, fixed location, retail or mail distribution or on-line access). Each of these media has its own professional and economical organisation, its own IPR clearance mechanisms. Moreover, the role of the many different above-listed categories of players differs widely from one medium to another.
· Diverse approaches to content issues in various geographical zones, but an ever more global trade in content. Although the importance of different players in the content industry differs in different areas of the world, the same fundamental digital revolution is at work everywhere.
· A multiplicity of public action issues ranging from policy to (de-)regulation and of course to research programmes.
· A blossoming diversity of cultural behaviour and societal approaches.
The on-going revolution:
What is the true nature of the on-going revolution? First of all, it is not new. At the strictly technical level, the information infrastructure for electronically distributed text has been mature for more that 20 years. We have 15 years of experience in electronic commerce of photographic images which is not far from other forms of electronic commerce such as digital distribution of music. As early as the mid-eighties there were discussions between European and US researchers about the impact of interactive access on digital media held in public and private archives.
Since this is not new, lessons can be learnt from what has happened and from what has not happened. It is not new and it is here to stay . No stable state of the information infrastructure and supporting technology will be reached in the short term. Furthermore, the true nature of the revolution is embodied in two words: digital and interactive. Digital media raise both new problems in terms of intellectual property and, together with interactivity , open new worlds in terms of content trading. In particular, one of the main side effects of interactivity is the fact that the distinction between content and software applied to content is being eroded for all media, which in itself raises a whole world of IPR problems.
Considering the above context , what is the rationale for the European Commission to support research and consensus building in the field of IPR management technology and systems? Furthermore why should we consider both aspects (consensus and technology & systems) as intertwined?
Why not just let the market operate freely? Simply because the "laisser faire" approach is raising concerns. The content industry is in a odd situation: it is both described as the key to the future and yet it is seemingly stuck at a relatively small share of world GNP. It seems that a key ingredient is missing or lacking in sufficient quantities , an ingredient that can be described in one word: TRUST. Indeed, trust must be built between players in the field of one medium, but also across media and across borders. Even more important from the economic and political viewpoints: consumer's trust and trust of the citizen that he or she can benefit from the digital revolution (which in other ways might be seen as a danger).
Trust has something in common with the future: it cannot be created by decree. Trust can only be built by the players themselves through consensus. And this consensus deserves its name only if it is world-wide, and if it is able to keep a proper balance between the various players involved. There is not only a case for striving for such a consensus, there is also a good and new potential way of doing this, because more and more players are becoming convinced that this is not a zero-sum game. Public action, in particular in research, can only create a favourable environment for this consensus building, and post objectives in such a way that the available technologies will potentially cover as wide as possible a set of access modes and user functions. Research must here be seen in contrast to policy and even to regulation and de-regulation, even if it has naturally to be co-ordinated with them. The key word is that technologies and systems for IPR management must be enabling technologies. They should be able to potentially support the full range of business models that each of the industrial players dealing with contents will chose for itself. If there is a democratically adopted policy on such general interest issues as rights of access or fair use, it should be possible to use them (the IPR technologies) to implement that policy or to ensure trust that it is not misused by dishonest players.
One essential aspect of the EC action (see figure 1) is that it supports :
· international consensus building by production of reference models (global, in projects such as IMPRIMATUR, specific to a given sector in projects such as the MUSE project on music-on-demand models for the music industry or the ECUP project for libraries), and,
· design, development and trial of systems and technologies that implement these models or constitute building blocks which can be used to implement them (IMPRIMATUR again, but also a number of projects such as COPEARMS, COPYSMART, TALISMAN, OCTALIS, etc.)
This last point is essential: every one has seen or imagined demonstrations of how easily digital contents can be copied or tampered with. It is a key factor for trust that the technical infrastructure for protecting contents while making them accessible is seen as concrete, as present here and now. The key word here is inter-operability, easy to say but difficult to achieve. There will be a multiplicity of IPR management systems, and no a-priori standardisation is likely to be successful. At early stages of the design processes for ECMS, provisions for inter-operability can result in only minor changes, or reasonable efforts to establish some common ground, in contrast to costly investment if this requirement is brought in only when large scale infrastructure is in operation.
Figure 1
Enabling technologies will deserve their name not only if they enable a wide variety of business models for content providers and related access modes for consumers. The on-going revolution is not only digital, it is also interactive. The real benefits to consumers and citizens will ultimately be a key factor deciding whether the digital commerce of contents actually delivers growth and cultural enrichment. Until very recently, lack of trust has often resulted in access systems offering such a restricted range of functions, that the real benefits for their final user was quite limited compared to competing classical ways of accessing information. Public research programmes, through the inputs they receive from industry and academic innovation centres, also have a particular responsibility in keeping the future options open.
4. Who is doing what in the European Commission
The table below summarises who deals with what in the European Commission regarding IPR issues. , Basically, main responsibility for the regulatory aspects lies within DG XV (internal market and financial services) and DG IV (competition), the policy aspects are spread among many DGs from DG I (international relations, TRIPS agreements), DG X (audio-visual and culture), DG III (industry), DG XIII (telecommunications), etc. The research programmes in Information and Communication Technologies are under the responsibility of DGs III and DG XIII. In the 5th Framework programme which will enter in application at the end of 1998, there are plans to integrate closely the research programmes in this field, which will facilitate their day-to-day co-operation.
Figure 2
The outline strategy developed below stems from the practical experience of on-going activities and from various forums involving concerned players. It has also become clear that technological R&D supported by the EC programmes has to be developed in close cooperation with legal and regulatory initiatives as well as with policy initiatives at various levels.
In particular, the interaction between emerging technical mechanisms for IPR management and the legal environment deserves particular attention. Legal and regulatory harmonisation, liability issues, lawful encryption techniques, legal protection of technical systems for identification and IPR protection are key issues to solve for the emergence of interoperable electronic copyright management systems (ECMS). On the other hand, the potential economic and social impact of ECMS may call for legal and regulatory adjustments.
That being said, it is proposed that future R&D strategy in this domain should follow 4 action lines with emphasis on international cooperation and practical business aspects in liaison with other electronic commerce initiatives:
· Continuous support for the consensus building process focusing on "international consensus". The core objective of this action is to shape a common trusted global infrastructure that takes into account the diverse business models and interests of all players, thus generating the confidence needed for large investments in practical business applications. It is expected here that various regional initiatives all around the world will converge in a global and representative consensus forum likely to give confidence in its outcome.
· Development of enabling technologies. Supported developments in this area should aim at enabling and not restricting access to information. New developed technologies will have to be seen in a context of interoperabilty between different technical platforms, different kinds of digital material and across borders.
In this context, emphasis will be put on the definition of standards focusing on "functionalities" and "interfaces" that will enable the development of different competing but compatible technologies.
Identified priorities are the development of technologies for identification (identifiers, watermarking, encryption, etc.), protection and authentication at the users' end.
· Support for the implementation of real business pilot applications. Real business applications are the ultimate goal of the whole exercise. As such, it is proposed that pilot applications be given priority taking into account the following arguments:
- they will clarify the new business models built around ECMS's,
- they will provide the technology developers with key functional requirements from all actors involved in the business chains,
- they will help to identify existing bottlenecks in the regulatory environment.
· Accompanying and supporting measures. The main goals of such measures will be twofold:
- To better understand the cultural and socio-economic impact of ECMS in order to better focus R&D actions in a direction likely to be more beneficial for society as a whole. Such studies will also be used to support general policy initiatives in this field.
- To put in place co-ordination mechanisms to ensure compatibility and interoperability between the different solutions implemented in various pilots and to allow for liaison with the developers of enabling technologies. Such co-ordination mechanisms will also be charged with disseminating information which, in particular, will allow small players to have a chance to contribute and benefit.
While ECMS implementation was originally perceived to emerge quickly, the issues at stake have proven to be very complex and the process longer than expected. Building the necessary trust at international level is the common challenge for the coming years. The objective of the initiatives taken by the European Commission is to provide a favourable environment in which all the players concerned have a chance to contribute to establishing durable balanced solutions taking into account legitimate interests of all interested parties.