The U.K. music industry has lambasted the government for unrealistic expectations in its copyright reform proposals, published Dec. 14, to boost the national creative businesses in the digital age by relaxing certain provisions in the copyright law next year.
If adopted, the proposed changes, which undergo a major consultation period with the affected sectors (including film, books and games) during the next 14 weeks, could lead to a radically changed intellectual property (IP) legislation.
Unveiled by the U.K.'s Intellectual Property Office (IPO), the proposals form the government's official next move after recommendations made in the Hargreaves Review, the independent report commissioned by Prime Minister David Cameron in November 2010 to make copyright legislation easier to implement while toughening IP protection.
Designed to foster innovation and enhance economic growth as well, the Review's suggested reforms are expected to boost the country's gross domestic product (GDP) by between 0.3% and 0.6% annually.
That amounts to economic growth of between £5.5 billion and £7.9 billion ($8.5 billion-$12.2 billion), concludes the IPO, which is part of the government's Department for Business, Innovation and Skills.
But U.K. Music, the umbrella organization representing the total U.K. music sector, believes the calculations are based on "deeply flawed assumptions."
"From the evidence presented so far, U.K. Music believes that these growth projections are overstated and unrealistic," it said in a statement.
"Added to this is a very real danger that poorly targeted or ideologically driven changes to copyright law could instead undermine growth, both for the U.K.'s creative sector and those digital businesses dependent upon our valuable content."
However, Baroness (Judith) Wilcox, the minister for intellectual property, said in her statement that "we are encouraging businesses to come forward with thoughts and evidence on our proposals (for) some freeing up of existing copyright legislation. This consultation is (to) ensure copyright legislation in the U.K. keeps up to date with emerging technologies and consumer demand."
Like the other creative businesses, U.K. Music and its members will be offering more detailed opinions during the consultation period that ends March 21.
The proposed revised legislation will enable consumers to "format shift," that is, legally copy their CDs to .mp3 players, iPods and other digital devices. This alone is expected to generate a potential annual GDP growth of £0.3 billion-£2 billion ($0.46 billion-$3 billion), says the IPO's analysis of the Hargreaves recommendations.
Improving the means for licensing and clearing "orphan works" by unknown rights owners is expected to yield GDP growth of up to £0.3 billion ($0.46 billion) a year.
Opening up the channels that allow the parody of other people's copyrighted works without permission will lead to a GPD growth impact of up to £0.6 billion ($0.92 billion).
The single recommendation expected to generate the most in terms of GDP impact is the Digital Copyright Exchange (DCE), the planned groundbreaking platform that would simplify the means by which rights owners license their works to users. That alone is expected to lift the U.K. GDP growth by £2.2 billion ($3.4 billion) a year.
And its importance in the scheme of things was confirmed last month (November), when Vince Cable, the secretary of state for business, innovation and skills, appointed Richard Hooper, the former deputy chairman of communications regulator Ofcom, to conduct a study to determine the DCE's feasibility.
The IPO's analysis also concludes that the proposed reforms could help improve the digital-music revenues yielded in the European Union (EU), where the U.K. is the biggest single digital music market. Although it is bigger than the U.S. in terms of population and GDP, the EU still lags behind the United States.
The EU has a population of about 501 million compared with the U.S.' 310 million, while it has a GDP of €12.8 trillion ($19.8 trillion) next to the U.S.' €11.1 trillion (€17.2 trillion).
Currently, it estimates, the EU's digital-music market generates about €900 million, that is 33% of the €2.7 billion generated in the U.S.