Copyright and the cable indsutry

Copyright was identified as a high priority within Cable Europe with a strong link between the traditional copyright issues (retransmission, collective management) and new copyright aspects (Video on Demand, enforcement).

The growing complexity and multi-territory nature of much of the European cable business does not sit comfortably alongside today's Regulation on Collective Management. The actual clearance system as provided by the 1993 Satellite and Cable Directive (SATCAB) is still organised according to the old market situation where cable only offered analogue TV services.

Today cable is rolling out new services like interactive digital TV, offers more TV channels, and deals with an increasing share of international content and different content sources. In this modern environment, the existing copyright clearing system is hugely inefficient (lack of transparency, high transaction costs, impossibility to negotiate fair and market-oriented prices) and often a big hurdle to launching and managing new services.

The Commission consulted in October 2009 on a Reflection Document outlining the existing challenges for three groups of stakeholders - rightholders, consumers and commercial users. With this public consultation the Commission's services wish to launch a wide-ranging debate on how to develop vibrant online markets for goods and services protected by intellectual property rights. The consultation addresses the role of legal online markets and explores a variety of copyright management models that may induce a more rapid development of such markets. Cable Europe replied to this consultation by underlining the crucial role of technology neutrality in any solution proposed.

Copyright in the Digital Agenda

The Commission's Digital Agenda for Europe has announced the following action areas to simplify copyright clearance, management and cross-border licensing in order to achieve a vibrant digital single market: Enhancing the governance, transparency and pan European licensing for rights management by proposing a framework Directive on collective rights management by 2010; After an extensive stakeholder dialogue, report by 2012 on the need for additional measures beyond collective rights management allowing EU citizens, online content services providers and right-holders to benefit from the full potential of the digital internal market, including measures to promote cross-border and pan-European licenses, without excluding or favouring at this stage any possible legal option; In preparation thereof, issue a Green Paper addressing the opportunities and challenges of online distribution of audiovisual works and other creative content by 2010; On the basis of the review of the Directive on the enforcement of intellectual property rights, and following extensive stakeholder dialogue, report by 2012 on the need for additional measures to reinforce the protection against persistent violations of intellectual property rights in the online environment, consistent with the guarantees provided in the Telecoms Framework and fundamental rights on data protection and privacy.

Cable Europe considers that the European Commission's plan to accelerate the EU's single digital market will need to facilitate consumer access to legal content in order to have concrete positive effects on the European economy: "Distinguishing between online and offline becomes less relevant as in today's world, content comes from a variety of sources, many of which are increasingly digital. Why not just focus on promoting digital content? To begin to do so means swift action where meaningful copyright reform is concerned".

Cable Europe Calls For New Copyright Regime

In order for cable companies to streamline their transaction and management costs, a new system needs to be put in place. That is in brief the conclusion of the study "Economic Impact of Copyright for Cable Operators in Europe", conducted by Solon Management Consulting, and sponsored by Cable Europe, Liberty Global, Kabel Deutschland, VECAI and Telenet.

The new technology neutral clearance system that is proposed in the study is mainly based on two pillars: an all-rights included package for cable companies, and a central licensing framework for all copyright users. This system would lead to an increased market efficiency and effectiveness, to competition between the collecting societies and to a fair market value of copyright prices. This system would be beneficial for all parties involved.

In short, this new "All-Rights Included, Central Licensing" system would be organised against the following principles:

• Broadcasters to clear all rights necessary for communication to the public
• Broadcasters thereby to offer fully cleared packages
• Broadcasters and content providers to have the opportunity to clear all their relevant rights at one organisation of choice at European level
• Competition between collecting societies to support the development of fair market prices
• Clearing mechanisms to be established to guarantee fair distribution of fees

CISAC Antitrust Case

The Commission has issued in January 2006 a Statement of objections against CISAC (the International Confederation of Societies of Authors and Composers) as the European Institution considers that exclusivity and territoriality restrictive clauses contained in the CISAC's model for reciprocal agreements on Copyright collective managementc might infringe the EC Treaty's prohibition on restrictive business practices (art. 81 Treaty). 

Commitments to avoid a competition infringement decision have been made by CISAC. All interested parties have been invited to market test these commitments. 

The Commission has now decided that these practices were anticompetitive. 

The decision prohibits membership restrictions which prevent authors from choosing which collecting society they want to represent them. 

The decision also prohibits the territorial exclusivity clause that prevents a collecting society from offering licences to commercial users outside a given territory as such a clause restricts competition among collecting societies, and forces users to deal with a monopoly provider in each territory. 

Finally, the decision prohibits a concerted practice between collecting societies according to which the collecting societies limit their mandates to the domestic territory of the other collecting societies, as a concerted practice which limits the right to grant licences to domestic territories is illegal. 

Almost all collecting societies members of the CISAC have appealed the Commission's decision.