New Clause 4 - Copyright in broadcast

Intellectual Property Bill [Lords] – in a Public Bill Committee at 2:15 pm on 30th January 2014.

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‘(1) The Secretary of State will, within six months of the commencement of the Act, bring forward a report to both Houses of Parliament outlining his view as to whether section 73 of the Copyright, Designs and Patents Act 1988 (reception and re-transmission of wireless broadcast by cable) is still applicable in today’s broadcasting medium, and what further changes to legislation he plans to make in the light of his review.’.—(Mr Iain Wright.)

Brought up, and read the First time.

Photo of Iain Wright Iain Wright Shadow Minister (Business, Innovation and Skills)

I beg to move, That the clause be read a Second time.

Section 73 of the Copyright, Designs and Patents Act 1988 allows the immediate retransmission of the main free-to-air public service broadcasters, or PSBs, by cable in the area where the original PSB channel was broadcast. The purpose of the section was to allow cable operators to retransmit PSB services without agreement, consent or, at times, payment, and without the risk of infringing copyright.

Under the Communications Act 2003, PSBs must offer their PSB channels to cable operators. It is my understanding, however, that the PSBs have to pay for the right for their channels to be carried on satellite platforms. As I have hinted, the purpose of section 73, a quarter of a century ago, was to encourage the roll-out of cable in the 1980s and ’90s as a competing platform to terrestrial television. Everyone is aware that the world of 2014 is different from that of 1988. Consumers access programmes on a vast variety of different platforms, in the way that is convenient for them.

Committee members might be familiar with the recent lengthy court case between TVCatchup Ltd on the one hand, and ITV, Channel 4 and Channel Five on the other, about TVCatchup streaming programmes by public service broadcasters. The High Court judgment on 7 October 2013 stated that TVCatchup had infringed the PSBs’ film and broadcast copyrights by streaming to members of the public. That was mentioned a number of times on Second Reading. Committee members will have seen the comprehensive briefing on this issue from ITV, which is actively looking for section to be 73 repealed.

ITV claims that the current re-transmission and access regime is distortive and unsustainable, and is hindering investment in original UK broadcast content, and says that evidence suggests that changes to the platform access regime will result in event greater investment in content. It says that maintaining the current regulatory arrangements is making it harder to invest in high levels of UK-originated content, reduces income for creators and stifles overall growth in the UK creative industries. Those powerful arguments must be considered carefully. Although section 73 seems to be from a different time, we need to be clear about it and, before we move actively to repeal it, think about the consequences.

In the summer, the Department for Culture, Media and Sport published “Connectivity, Content and Consumers: Britain’s digital platform for growth”. The Minister said confidently that there was a joined-up Government approach on this matter, but it did not seem that the Department for Business, Innovation and Skills was involved much in it. I am worried about that, about IP and copyright matters being spread across two Departments, and about the silo approach to government. In that report, the Government stated their wish

“to see zero net charges, where the fees for access to the main platforms and for PSB channels cancel each other out…We are looking closely at how we can help achieve this without allowing other kinds of online services to exploit PSB content, with no benefit flowing to the PSB. ”

They have pledged to

“launch a consultation on this in the autumn, before bringing forward legislative proposals if required.”

Photo of Jim Dowd Jim Dowd Labour, Lewisham West and Penge 2:30 pm, 30th January 2014

I do not know whether other Committee members have received a similar communication, but in fairness, having mentioned this on Second Reading, I should say that I have been contacted by Virgin to say that its current position is that it does not charge for the products to be broadcast, and does not pay for the channels from the PSBs.

Photo of Iain Wright Iain Wright Shadow Minister (Business, Innovation and Skills)

That is a fair point. I understand that some four million cable customers do not have to pay additional charges. I hope that that continues under any subsequent regime. The new clause is meant to be helpful; it is meant to ensure that section 73 is still applicable in today’s digital broadcasting world.

What further plans for legislation might be needed? The new clause ties in well with the consultation that has been aired by the Government and the review that is planned, although the clause might, I hope, bring forward that process. I appreciate that some PSBs are adamant that section 73 should be repealed. However, as I just said to my hon. Friend, outright abolition might hinder the consumer rights of four million people who gain access to PSB content through cable. Virgin has a different approach from ITV. This needs to be looked at carefully; there should be active consideration of all possible consequences and repercussions, and a subsequent discussion on how a clause could be drafted that would meet the Government’s intention for a level playing field for all platforms, and net zero fees either way. I hope that the Minister regards the new clause as constructive and helpful—that is what it is intended to be—and will adopt it as part of the Bill.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I can offer the hon. Gentleman some comfort: we understand the need to review the effect of section 73. In the Department for Culture, Media and Sport policy paper, “Connectivity, Content and Consumers”, published in August 2013, we set out our policy objective of wanting zero net charges—that is, we wanted fees for access to the main platforms and for public service channels to cancel each other out. That is actually quite close to the current market position. We recognise the issues with section 73 that the hon. Gentleman identified, and we understand the need for further consideration of it.

I invite the hon. Gentleman to withdraw the new clause, which would set a specific deadline by requiring the Government to report on whether section 73 of Copyright, Design and Patents Act 1988 is still necessary and effective within six month of the commencement of the Intellectual Property Act. The difficulty is that, although he used the past tense, the court case that he referred to is going to appeal; the litigation therefore continues. We have to wait for a result in the ongoing litigation about the meaning of section 73. It is not possible to impose timetables for review or resolution until the litigation is resolved, so we cannot accept the timetable that he proposes. However, I can assure him that following the resolution of the court case—whenever that is—the Government will consult on section 73 and the broader framework of checks and balances. In the light of that assurance, I hope that he feels able to withdraw the new clause.

Photo of Iain Wright Iain Wright Shadow Minister (Business, Innovation and Skills)

I am grateful to the Minister for his comments; that was very helpful. He has only 461 days to go before he has to make room for us in government;  I would like to nail down his point on timing and legislative changes, given that there is one Session left of this Parliament. I know that the ongoing court case makes it difficult, but will the Minister give an indication of the time frame, given that investment in UK broadcasting content may be hindered as a result of the ongoing use of section 73? Will he pledge to introduce legislative changes in the next Session?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I have said to the hon. Gentleman that the zero net charges policy is not far off the current market position, and I have accepted that there needs to be some kind of review. However, the litigation is proceeding, and the Government have no control over its timing. It would be wrong to set a timetable that we have no capacity to deliver. I repeat my assurance that we intend to conduct a review after the litigation is resolved.

Photo of Iain Wright Iain Wright Shadow Minister (Business, Innovation and Skills)

The Minister is being reasonable and fair. I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.