Last night the Big Innovation Centre was delighted to host the launch of two major new reports commissioned by the Intellectual Property Office (IPO):
- Changing Business Models in the Creative Industries: The Cases of Television, Computer Games and Music. An Independent Report Commissioned by the UK Intellectual Property Office. (prepared by Dr. Nicola Searle, University of Abertay Dundee)
- Private Copying and Fair Compensation: An Empirical Study of Copyright Levies in Europe. An Independent Report Commissioned by the UK Intellectual Property Office. (prepared by Professor Martin Kretschmer, Bournemouth University)
The reports are part of a wider programme of research from the IPO which seeks to understand the role of intellectual property in the UK economy.
Both these reports focused on the copyright and the creative industries. At the heart of both was a concern for the different mechanisms which, in a digital age, are needed to ensure content creators continue to have proper incentives – and rewards – to invest and create. Abertay University’s Nicola Searle reported on research which developed six in-depth case studies of creative industries organisations which are exploring new business models. Martin Kretschmer’s paper reviewed the state of play across the EU on charges levied on consumer goods as ‘fair compensation’ to creative producers for their country’s invocation of a copyright exception for private copying or format-shifting.
As Big Innovation Centre Director Birgitte Andersen noted in her introduction, this is a controversial area for research, where robust debate and a degree of openness will be required to move forward. The evening certainly lived up to that billing.
A key conclusion of Nicola’s research was that intellectual property was not an over-riding concern for her case study businesses in terms of how they selected their business model, but that it remained an important part of the jigsaw. Equally important for the case organisations was to recognise and adapt to the pace of change in business models, and the increasingly important role of digital intermediaries and content aggregators.
In panel responses expertly chaired by Exeter University’s Charlotte Waelde, panellist Sandy Duncan, CEO of YoYo Games (one of Nicola’s case studies), declared he was ‘relaxed’ about the nearly 4 million illegal downloads of his company’s Game-Maker product, partly because that was only one business model YoYo was operating. He also stressed the self-policing element of much of his company’s network of users who generate new content, rather than seeing likely legislative solutions to plagiarism and passing off among user-content generating communities. Lovefilm’s Paul Thompson agreed with Nicola’s conclusion, and suggested we should be wary of making too many changes to a copyright system which has served the UK relatively well. However, he felt a full implementation of the Hargreaves Review recommendations would be a step in the right direction for helping UK creative businesses – including his own – deal with IP more effectively.
Bournmouth University’s Martin Kretchmer reported an extensive review of the EU copyright levy which exists in 22 of 27 EU jurisdictions (but not in the UK). He declared it ‘deeply irrational’, with the motivations, reach and implementation of the system opaque, inconsistent and incoherent. His work came under robust challenge from PRS for Music’s Will Page, who suggested the research took too narrow a view of the market, and only at a fixed point in time, which made it difficult to assess how the levy was really working, or to conclude from it on the appropriateness of a levy for the UK. Nokia’s James Waterworth felt that the current EU multi-country system worked neither for companies such as Nokia, nor for consumers, and that Martin’s work provided an important baseline dataset which wasn’t available before.
In closing, Birgitte Andersen stressed that this was the beginning, not the end of the debate, and that, across the different perspectives – we need to keep in mind the shared goal of supporting and growing the UK creative industries. Over the next year the Big Innovation Centre will be taking forward research focusing on the range of policy responses which can support the flow of revenues to content creators while allowing for maximum innovation in this diverse sector.