---

Internet: Online Piracy

My Lords, I thank the noble Lord, Lord Lloyd-Webber, for allowing us to have the debate. I think that the speeches have been of quality rather than quantity. There have been very informed contributions, and I mean that as a sincere compliment. The noble Lord, Lord Lloyd-Webber, spoke with great insight on the issues relating to digital piracy and its potential impact on creative talent in the UK. The House is very grateful to him for giving us the chance to talk about this important issue this afternoon. Let me begin by saying that we regard this as an important topic. It is important to me and it is an issue that David Lammy, as Minister for Intellectual Property and Higher Education, holds close to his heart, partly because it is part of his current ministerial brief, but also because he once worked as an intellectual property lawyer, so he brings some expertise to the matter. I fully share the noble Lord’s appreciation of just how important it is to safeguard the creative industries’ contribution to this country’s well-being. The creative sector accounts for 8.2 per cent of UK GDP. In London alone, one in five jobs is in the creative industries. It is important that we offer all the support that we can, given the thousands of jobs that the industry supports, especially in difficult times such as ours, as the noble Lord, Lord Lloyd-Webber, said. While figures suggest that sales of music and film are continuing to grow despite the current economic difficulties, we cannot be complacent about problems such as digital piracy. It is estimated that the total loss to the film industry in 2007 was in the region of £486 million. The music industry estimates that its own lost sales were probably around the £165 million mark, and that figure may well be conservative. That is why the problem of digital piracy should matter to all of us. Clearly, today’s debate focuses on the impact of piracy on creative talent within the UK, but it would be remiss of me not to highlight that in some cases piracy is a crime that damages more than our economic or creative capabilities. My fellow Minister, David Lammy, told me how that was particularly brought home to him by a raid that he attended in north-west London in November. In that raid alone, 60,000 counterfeit DVDs were seized, among which were a significant number of obscene, pornographic titles that would not have been granted a certification in the UK in the first place. I was interested in the range of contributions made by noble Lords. There was recognition, above all, of the complexity of the issue with which we are dealing. That reinforces our approach: good law is good, but proportionate, enforced laws are better. Noble Lords explored the question of achieving both proportion and the ability to enforce legislation. I know that we are not introducing jail terms for online infringement, as some in the industry have called for. However, I think that the measures that we propose will offer an effective deterrent to fraud that stops short of putting even more pressure on already crowded prisons. Whether we are talking about new or existing law, effective enforcement is clearly the key. We need to be in a position where all government departments and key individuals within the police, trading standards and local authority structures tackle these issues together. That is why we have set up an interministerial group on enforcement, With ministerial and other colleagues, we need to look at how we can effectively raise public awareness and understanding of these issues and at how to remove some of the practical barriers to more effective on-the-ground enforcement. The best approach is to combine enforcement within the resources available with other types of measures that we have been talking about, as well as public education on the consequences of copyright crime. I was interested in the visit made by the noble Lord, Lord Clement-Jones, to the Science Museum, which is taking a very innovative approach to showing young people that this is not a crime that has no victims. We are currently exploring the options for establishing a rights agency. It is likely that part of its remit will be to focus on encouraging respect for the creative industries and increasing public awareness of the easiest ways to access legal content. I assure the noble Lord, Lord De Mauley, that we have not made up our minds on this; we are still out to consultation. It is not that we are dithering. This debate has reflected that, first, there is a range of views on how to deal with the problem and, secondly, not only does a complexity currently exist but it is an increasing complexity; it is not something that we can solve nationally. As the noble Lord, Lord Clement-Jones, pointed out, there is a need for international action as well. I do not plead that as an excuse; I just make these points because I think that they are relevant to this debate. Therefore, the Government have been meeting the industry to discuss the most effective way in which to tackle internet piracy crime—not just piracy but all forms of internet piracy crime. I know that partnership working between organisations such as the Federation Against Copyright Theft, the BPI and the IPO’s enforcement unit has been invaluable, and I encourage all other industries to develop the levels of intelligence gathering that these bodies have. We are also doing our best to support our creative talent, as I am sure the noble Lord, Lord Lloyd-Webber, appreciates. The very nature of the creative arts means that they are dynamic and always changing, developing and innovating. As well as bringing challenges, the digital age has brought tremendous creative potential. I was fascinated by the up-to-date knowledge of the noble Lord, Lord Luke, who mentioned the various services being offered. He identified things such as Spotify and referred to other independents offering online-only music and film. He also gave the interesting and fascinating example of the Radiohead offering, which, in a way, seems to be counterintuitive. However, I think that he demonstrated that, when talking about supporting young people with talent, we have to look at how the things that they do creatively are offered online in a way that perhaps a few years ago we would never have imagined. We have already made progress. In Creative Britain, we set out a three-year strategy for the creative economy in the UK, backed up by more than £70 million of government funding. We committed to establishing, by 2013, 5,000 creative apprenticeships annually and we funded 10 pilot programmes designed to provide greater access for young people to a range of cultural and creative opportunities through the flagship Find Your Talent programme. Again, we are trying to involve young people in these programmes and are making them aware of the importance of intellectual property rights and content. In 2008-09, the Technology Strategy Board ran a £10 million R&D programme for the creative industries, investing in more than 90 creative industry SMEs and major innovative collaborative R&D projects. In all, almost 300 UK-based companies and academic institutions will have benefited from this investment. We are also developing a project with the Local Government Association to research and deliver a menu for local infrastructure. There was much reference in the debate to the memorandum of understanding and the question of how to tackle peer-to-peer file sharing. The Government have worked with both rights holders and ISPs to find an industry-led solution to the problem. We may not all agree on exactly how we should do it but I think that there is some consensus that that route probably gives us the best chance of success. A memorandum of understanding was signed by the six major ISPs and rights holders to get an industry-led solution. We remain committed to the principles set out in the MoU and are working hard to achieve, as agreed, a substantial reduction in illicit peer-to-peer file sharing. Recent legislative proposals on peer-to-peer file sharing will go a long way towards achieving that reduction, with some evidence suggesting that up to 70 per cent of infringing users will desist on receipt of a warning letter. We are looking into options such as the rights agency as one way of continuing the valuable work arising from the memorandum of understanding in a form suitable for today’s environment. I believe that we have provided enough of an outline of how we are tackling digital piracy and other forms of internet piracy crime. Everything that I have covered so far offers better safeguards for nurturing our creative talent and for the profitability of our creative industries and those who work in it. However, the work that we are doing to improve internet piracy enforcement goes much wider than one industry or sector. Our key priorities here must remain to educate consumers on these issues and to work with government departments and front-line enforcement agencies to ensure that they understand how IP issues fit into the wider civil and criminal enforcement landscape. I have tried to cover most of the points raised. If I have missed any, we will write to noble Lords. Today there has rightly been a rehearsal of the issues surrounding internet service providers. It is a critical area. The debate has highlighted polarised opinion, which the consultation on peer-to-peer file sharing clearly demonstrated. I think that we all agree that there will be no easy answer to this problem. In a way, the noble Lord, Lord Luke, summed it up when he said that we have to be careful that we do not produce oppressive legislation that acts as the enemy of innovation. That would not serve any real purpose or benefit for the creative industry and we do not believe that it would serve the country. We have to proceed cautiously. The answer must surely be to find a course that works, is proportionate and involves rights holders and ISPs. As I have indicated, discussions are under way and experience shows us that joint agreement must be the way. ISPs and industry have a key role in finding a solution to this problem. I thank the noble Lord again for initiating the debate. This is probably the end of the beginning—certainly it will run and run, as they say sometimes of West End shows.