What's New in Digital Media Law (2)
Well, for those of you who spent the weekend waiting anxiously for the 2nd installment of 'What's New in Digital Media Law', here is. In it, I'm doing some further scene setting with an overview of "Digital Media" and the "Digital Media Market."
“DIGITAL MEDIA”
You can take your pick of definitions of the phrase “digital media”. But I’m using it to mean two things:
First, digital delivery channels – the Internet, mobile and digital television – to deliver content and to provide a platform to sell physical products online.
Examples include:
o Online music services.
o Books sold through publishers’ websites as well as distributors such as Amazon.
o TV programmes delivered on-demand via ‘catch up’ services such as the BBC’s i-player and Channel 4’s 4OD.
o The emerging market for Internet-distributed movies. For instance, Apple recently signed deals with all Hollywood Studios for itunes rental, although not for digital purchase.
Second, I am using “digital media” to cover new, ‘born digital’ content and services which would not have existed but for digital technology and the Web. For example:
o ‘3D’ Movies.
o Social Network/community sites such as Youtube, Myspace and Facebook.
o E-books and digital audio books which, with their searchability and other features in digital form, are really different to their paper and analogue audio counterparts.
o New advertising-supported services such as interactive Internet TV services like ‘Babelgum’ which offers independent and new content, including professionally created user content with ‘Web 2.0’ features such as tag searches and collaborative filtering.
In fact, this distinction between new distribution channels and new digital services is artificial. Increasingly, new digital services act both as a channel to distribute what one might call traditional content such as films and as a platform to deliver new services. For example, MySpace is in talks with music labels for downloads; there are film clips available on YouTube and blogs like the ‘HuffingtonPost.com’ are morphing into online newspapers.
Over time, these distinctions will disappear and digital media will simply become “media”.
And let’s not forget that content moves just as easily from digital to analogue as the other way round. Look at the current litigation in New York, in which JK Rowling is suing for copyright infringement arising from the unauthorised publication of a book, The Harry Potter Lexicon, which consists substantially of JK Rowling material first published on the Web.
STATE OF THE DIGITAL MEDIA MARKETS
How do the markets for digital media content look to our Regulator? They’re in a febrile state; “living with uncertainty and ambiguity” you might say if looked at from a psychological perspective. Markets characterised by change, experimentation and upheaval as well as the prospect of significant growth. An independent study on the interactive content market in the EU projects that revenues from online content will more than quadruple from €1.8b in 2005 to €8.3b by 2010.[1]
The biggest challenge facing the media industries today is, I think, commercial rather than legal. It’s how to re-shape existing business models, and to develop new business and revenue models, in the face of 3 major trends:-
1. Consumers’ reluctance to pay for Internet-distributed content. Currently, 99.9% of video consumption over the Internet is advertising supported.
2. The shift in advertising revenues from traditional to digital media outlets;
3. The impact of the Internet on “traditional” distribution models. For example, the market’s desire for on-demand movie services is putting the film industry’s traditional windows of exploitation – theatrical release, DVD, Pay TV and sell-through – under increasing strain.
What’s more, the content industries are faced with massive losses through counterfeit DVDs and large-scale piracy via P2P file sharing. Interestingly, as the TV industry moves to compete with online videos, television now ranks in the US as the fastest growing category of internet piracy.[2]
So what our Regulator sees are nascent markets where he or she must tread warily! With that in mind, in the next installment we'll start to tread the Regulator’s path and examine the four focal points of change in the world of digital media law.
Have a good week and enjoy the sunshine.
Laurie Kaye
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