The Digital Economy Act 2010 (DEA), which implements some of the policy aims set out in 2009’s Digital Britain Report, received Royal Assent on Friday 9 April 2010 ending a legislative process steeped in controversy. A series of trades on contentious parts of the Bill allowed Labour to secure Conservative support to push through the Act in the pre-election “wash-up” period.
The DEA deals with issues ranging from Ofcom’s functions to the role of internet domain registries, classification of computer games, and the responsibilities of Channel 4. The most reported and divisive part of the DEA, however, is a mechanism for copyright holders to require ISPs to take action against subscribers who download content that infringes copyright. The Government intended the DEA, however, to deal with broader issues affecting Britain’s digital economy but these reforms were lost in the wash-up. Reform of such matters as the funding of Channel 4, local news provision and super-fast broadband networks are left for a future Government to adopt or ignore.
Online piracy and website blocking
A war of words between the representatives of rights holders (supportive of the DEA) and ISPs and internet freedom pressure groups (who have challenged its provisions) spiked media interest in the DEA’s anti-piracy measures during House of Lords debate. Although opponents of the DEA secured limited concessions, the rights owners scored a key victory with the introduction of a framework to establish anti-piracy enforcement measures. Although much detail is missing, the consequence will be ISPs having to take technical steps (including bandwidth throttling and account suspension) against subscribers through whose internet connections persistent copyright infringement has occurred. If an ISP refuses to take such technical steps it may be fined up to £250,000.
Campaigners argued these requirements risk punishing innocent people and limiting the availability of public wi-fi. They also criticised a clause, proposed by the Government in the Bill’s Third Reading in the House of Commons, that gives the Secretary of State power to create a Statutory Instrument authorising courts to issue injunctions to force ISPs to block access to a “location on the internet”. Courts must be satisfied by a rights holder that “[that location]… has been, is being or is likely to be used for or in connection with an activity that infringes copyright”. Commentators have pointed out this could lead to sites such as Wikileaks being blocked, while Google criticised the amendment, saying: “We absolutely believe in the importance of copyright, but blocking through injunction creates a high risk that legal content gets mistakenly blocked, or that people abuse the system.” The Government has argued the requirement of court intervention creates a powerful balance against abuse.
Local news, telephone levy, spectrum and orphaned works
While the DEA’s anti-piracy measures made it through the wash-up, the Government was forced to drop a number of other proposals in order to secure support from Conservative MPs. Possibly the most significant of the policy goals lost to horse-trading was a plan to reorganise the funding of regional television news. Labour plans would have permitted “independently-funded news consortia” to bid for a slice of the television licence fee to fund production of local news. The Conservatives opposed this proposal from the outset, labelling it a “red-line issue” and warning bidders that a Tory administration would unwind any deals signed in anticipation of this provision becoming law.
The other headline casualty of the Digital Britain package was the funding of rural superfast broadband networks through a £0.50 monthly levy on fixed telephone lines. Labour has indicated that it will reintroduce the subsidy in the first finance bill after the election, if re-elected. The Tories are likely to top-slice the licence fee to subsidise network expansion. Labour has also said its first postelection finance bill, and the work of the Broadband Delivery UK group, will deliver on the commitment in the Digital Britain Report to create universal availability of 2Mbps broadband.
The wash-up also saw arrangements put on ice for auctions of digital dividend spectrum and spectrum due to be released by Orange and T-Mobile as part of their merger. Analysts suggest this may cause a crunch on network capacity in the coming year as demand for bandwidthintensive services grows.
Another measure dropped to secure the DEA’s passage was a plan to allow low-cost licensing of orphaned copyright works. The amateur photography community, particularly, argued against this provision. They feared it would deprive them of existing rights and allow unfair exploitation of their works. Representatives of libraries and archivists argued that the clause, if retained, would have facilitated research by making documents such as old political pamphlets, photographs and films more widely available.
Next steps
Much of the DEA puts in place the framework for future action, rather than bringing immediate change. It is unlikely that doomsday predictions of Google being blocked and businesses ending public wi-fi provision will come to pass any time soon. Further, the most controversial provisions of the DEA, dealing with piracy, are unlikely to have direct impact on individuals until 2012 at the earliest, and might not come into force if illegal file-sharing falls. The DEA gives industry the opportunity to draw up a code on how copyright infringement should be managed (if industry fails to do so within six months Ofcom will have the responsibility). The aim of the code will be to reduce illegal file-sharing. After the code has been in place for 12 months, Ofcom will report to the Secretary of State if it has achieved the purpose of reducing illegal file-sharing. If the code has not achieved that purpose, the Secretary of State will be able to order Ofcom to set out “technical measures” to be implemented by ISPs that can be taken against copyright infringers. That order itself will require the approval of Parliament.
Other provisions of the DEA, such as those dealing with the switch-off of analogue radio, will have similarly distant effect. The clauses that deal with the move to digital radio will only come into play once digital radio accounts for at least 50 per cent of radio use, and the Government does not expect that to be the case until at least 2015.
Aside from the aspects of the DEA that survived the washup procedure, it is likely further changes to the digital economy landscape will follow the election. If Labour retains its Commons majority it is probable it will seek to implement at least some of the parts of the Bill lost in the wash-up. The Tories, meanwhile, have made clear that any legislation agreed in the wash-up will be subject to review if they win power, and may be repealed. Further, the Conservatives have suggested that, if elected, they will look to introduce a new communications bill dealing with superfast broadband roll-out, and limit the policy-making role of Ofcom. Both aspirations would seem to require amendment to the DEA.
