Original URL: http://www.theregister.co.uk/2005/12/09/dti_consultation/

Publishers scrap over DTI ecommerce initiative extension

Aggravated over aggregators

By Emily Turner

Posted in Media, 9th December 2005 13:39 GMT

Analysis Online publishing could be set for revolution next spring if the Department of Trade and Industry (DTI) extends the Electronic Commerce Directive to online service providers.

Such a move would give them the same limited liability as ISPs, which are protected under the current directive if they unwittingly host, transmit or store unlawful content provided by third parties.

An extension would cover hyperlinkers, search engines and content aggregators if they published or linked to litigious third party material that breached UK copyright, defamation and contempt of court laws.

The DTI has launched a consultation on extending the initiative, dividing the business community in the process. Aggregators, such as Reuters, warn the UK’s e-commerce industry is in danger of falling behind the US. It said it’s physically and financially impossible to check the legal situation for all third party content on its feeds. Yahoo! stressed a clear and balanced notice & takedown regime is urgently needed and the unclear legal liability has hindered aggregators’ expansion.

The anti-lobby includes music rights organisations, which fear damaged revenues and inadvertent protection of illegitimate service providers selling pirate material. The regional press responded that it could undermine intellectual property rights and reduce licensed copying royalties. While they have contracts with aggregators, they said there would be no financial redress for search engines.

Third party content is a key component at Reuters, which aggregates market news, prices and financial data. It says the UK regime must be modernised to provide a “reasonable and workable environment for online publishers”.

Henry Manisty, Reuter’s head of government and public affairs, points out that under the Communications Decency Act and associated cases, US law already provides that online aggregators are not liable for third party content.

He says: "If the UK wants to remain competitive as a centre for online publishing it must provide equivalent protection for content aggregators. To put it into context, we update our content 23,000 times per second at peak market periods. Our systems provide sophisticated data error checking, but it’s clearly impossible for us to pre-vet all third party information, and it’s completely unreasonable that we should be liable for it. Also, if we delayed the publication of market sensitive information to check compatibility with civil or criminal laws, we could be in breach of financial services regulations that require market sensitive data to be disseminated swiftly."

Some European countries have already taken steps to protect such businesses. Susan Singleton, editor of IT Law Today, says: "Austria, Spain, Portugal, Hungary and Liechtenstein have already extended their e-commerce laws to reduce potential liability and to cover service providers, such as Google."

British Music Rights, whose members include composers, songwriters and music publishers, wants a greater differentiation between legitimate and illegitimate services. It told the DTI legitimate service providers have adequate protection and only illegitimate services will profit from an extension. It said members would find it “virtually impossible” to stop sites providing links to sellers of pirate or counterfeit discs, illegal music files or download and file-sharing sites.

Emma Pike, British Music Rights’ chief executive, says: “It is curious that the government has decided to reopen these discussions. The directive is an EU success story. It struck a carefully crafted balance between the interests of content owners and legitimate intermediaries and has been a key driver of online business.”

The Newspaper Society, which represents the regional newspaper industry, feels an extension could disadvantage traditional print media. The society’s political editorial and regulatory affairs director, Santha Rasaiah, says: “The DTI’s own impact assessment recognised that their introduction could encourage the appropriation of publishers’ and other right holders’ material, without the rights holders’ consent and receipt of copyright fees.

“There is a need for law reform to facilitate online publication and freedom of expression, not least in the libel area. But changes must help all those who publish online, including newspaper companies and others who generate content, host forums and stimulate exchange of information and views, but without undermining publishers’ intellectual property rights and revenues, or barring them from defences available to their commercial competitors.“

Unlike their regional counterparts, national publications will embrace an extension, as they are acting increasingly like ISPs rather than traditional publishers. One unnamed source said the current directive had created a two-tier environment, where online publishers are unable to compete effectively with ISPs. Limited liability would enable newspapers to publish or link to blogs and reader responses just as freely as ISPs.

The DTI is holding discussions with all stakeholders until the end of the year and will announce its decision in the spring.®