Getting it right

17.02.12 | Laurie King

The big idea of the Hargreaves Review on Intellectual Property is to create a “Digital Copyright Exchange” (DCE) to solve problems around copyright licensing in the digital age, and to make the UK a world leader in licensing creative content. It is a great idea. The publishing industry has welcomed the proposal, and the DCE Feasibility Study being led by Richard Hooper.

We’re all familiar with delays and transaction costs in clearing rights in existing works—especially in the context of new digital services—and the problems that can arise in locating the owner of works. So although there isn’t a “one size fits all” solution across all the creative industries, there is a consensus that automating the ways in which copyright works are located and cleared—and permissions for use communicated to users—is essential in the 21st century.

But there are two big issues that need to be resolved before the digital diggers can start building the DCE. The first is the scope and design of the DCE. The second is the government’s role and regulatory response. If these are handled correctly, the DCE could well live up to its promise. If not, we’ll have a digital white elephant.

Scope and design
A fully functioning market of digital rights has three elements: (1) the “metadata registries” which manage and deliver data about the management or ownership of rights; (2) the “exchanges”, the virtual marketplaces where digital rights transactions takes place; and (3) the “standardised communication” layer, the unseen “technical glue” that enables “machine-to-machine” communication to take place between these registries and exchanges, which facilitates these transactions across the internet. This is the vision that the Linked Content Coalition wants to see realised. Exchanges will be created by service providers, collective management companies and others.
It’s vital to recognise that there will be no single exchange or registry. Registries are being created across different industry sectors on a national or transnational basis by individual rights holders and organisations.

Great design is about clarity of vision as much as about deciding what to omit as to include. That is what is essential to the DCE. The government agrees with Har-greaves that the DCE should not be a state-funded and operated entity. It has neither the skills nor money to do that. The DCE needs to be a cross-industry entity that ensures that the standardised communication layer is built. This means encouraging the development of standards that, like the web itself, enable registries and exchanges to exchange messages and data in an automated, seamless way.

The DCE proposal is part of Hargreaves’ recommendations about which the government is consulting. There are many others, including extensions to copyright exceptions. I hope the government will bear two things in mind. First, the DCE should be based on voluntary participation. Rights holders should not be compelled to use the DCE as a quid pro quo for being able to enforce their rights. Second, digital content services are built on licensing. So while it’s right that copyright exceptions may, in certain cases, need updating, care must to be taken to ensure that over-broad exceptions do not undermine the need for licences for commercial uses.

Digital creative industries are the third most important export sector. The DCE, implemented in the right way, can play a really valuable role in delivering economic and cultural benefit for creators, consumers and the creative industries. Let’s engage with the DCE constructively, and critically, to make sure it delivers on its promise.

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