Intellectual Property

Chi Onwurah Excerpts

Tuesday 7th February 2012 Westminster Hall

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Caton. I congratulate the hon. Member for Perth and North Perthshire (Pete Wishart) on securing the debate, which is his second on this subject during this Parliament. He certainly is a champion of the creative industries’ property rights, and does all he can to ensure that the Government are held to account.

We have had an interesting and lively debate. The hon. Member for Cities of London and Westminster (Mark Field) made an eloquent call for an industrial policy for the creative industries, and I look forward to the Minister’s response. My hon. Friend the Member for Newport West (Paul Flynn), who is no longer in his place, gave a very interesting example of musical innovation through parody. My hon. Friend the Member for Lewisham West and Penge (Jim Dowd) reminded us that today is Dickens’s birthday, which should inspire us all, and my hon. Friend the Member for Falkirk (Eric Joyce) bravely did us all a service by putting forward what he termed the alternative view of internet freedom.

Today’s debate shows that intellectual property is a complex area, and that it arouses passionate responses because it affects the livelihoods of well-loved artists as well as the business models of very large companies. We have heard how important the creative industries are to this country, and I want to emphasise that. We are world players—indeed, world leaders—on the creative stage. Our musicians are top of the world’s charts, our films win Oscars as well as BAFTAs, and the release of many a British computer game is a major event across the world. But I also want to emphasise that IP is not only a matter for the creative industries. It includes patents, designs, trademarks and copyright, and is therefore the basis of almost all the non-tangible assets of the vast mass of industry, including very real world industries, such as manufacturing, and service industries, such as consultancy and advertising.

IP is an important part of the economic base for innovation, because it recognises and rewards the successful new idea, process, invention or song, and therefore provides an incentive for innovation, be it musical or technological. Innovation has been the engine of progress throughout history, and it continues to be a key part of growth. Recent analysis from the Harvard Business School suggests that 80% of growth is driven by innovation. The contribution of intellectual property to economic growth cannot therefore be doubted, especially now, when the internet is becoming such an important platform for commerce and for ensuring that there is greater and greater opportunity to exchange ideas creatively. We must do all we can to ensure that our intellectual property system guarantees that the right rewards are available to promote innovation, and thus economic growth.

As I said, intellectual property is also, however, a complex affair, and from the very start of a legal framework for copyright and patent law there have been those who have argued against it on the basis that it limits the free expression of ideas and therefore limits innovation. The wrong kind of intellectual property environment can certainly act as a barrier to innovation, and therefore to economic growth. I regularly speak to business people up and down the country, who complain that universities’ too protective attitude to their own intellectual property is making it more and more difficult for businesses and universities to work together effectively in the translation of intellectual property into technical products and services. Small companies can, of course, have their IP stolen by larger companies, which are better armed with more and better-paid lawyers. We need to ensure that the IP trolls are encouraged to free their IP, to enable genuine innovation and commercial success.

Technological advances have made certain types of intellectual property more difficult to protect. We have the recent example of megaupload.com. Its owners—if that is the right word—became multimillionaires through effectively supporting the illegal downloading of films and other creative content, and it is good to see that the international legal framework has worked to ensure that the site has been closed down. Illegal file sharing is certainly costing the creative industries dearly, given their current business models, and the previous Government set out ways of addressing that in the Digital Economy Act 2010.

We should not forget, however, that there are companies that are thriving under the existing copyright system, particularly those born digital. The Association for UK Interactive Entertainment, which represents the video games industry, tells me it has huge success in providing creative content through a wide variety of business models tailored to meet the needs of different demographics. This is a global industry predicted to be worth £50 billion by 2014. Many interactive entertainment companies have had huge success with the freemium business model, in which games are initially free but then users pay for additional content and features. I recently met Moshi Monsters—not the actual monsters, but their chief executive officer. Based on London’s Silicon roundabout, the company has used the freemium model to go from a tiny start-up to a $200 million business with 50 million users worldwide.

Intellectual property is a complex area, and it is essential to get the incentives right. That no doubt explains the long list of reviews carried out over the past few years, including Gowers, Byron and Hargreaves, and that is without considering all the work undertaken at the European level, such as with the European copyright directive and more recently the proposals for a unified patent court. Although I recognise that complexity, I am increasingly concerned that the Government are not taking the action necessary to get to grips with this. The rumours that the Hargreaves review was initiated because the Prime Minister had his ear bent by Google did not help its credibility, and although the report was generally well received, some of the evidence on which its conclusions were based has been questioned. So I am anxious to receive clear signs from the Minister that the Government are leading from the front on intellectual property, and not dithering as we saw with the 4G auctions. Certainly, when Labour was in office we did not want for reviews or action, but it is in the nature of such a fast-moving environment that the policy responses need to evolve.

Can the Minister tell us when the Government plan fully to implement all the measures in the Digital Economy Act, and if measures such as the public lending right in relation to electronic publications, and the content-blocking provisions, are not to be implemented, can he explain why? Do the Government have any plans to look more widely at intellectual property issues, such as patent law and the role IP plays in standardisation, particular regarding the proposals for a unified patent court? What are their thoughts on that? With regard to the Hargreaves review proposals for the digital copyright exchange, can the Minister update us on when he expects that to be in place, and on the measures being taken to address the concerns of the collecting agencies and the educational establishments? What steps is he taking to ensure that university intellectual property incentivises working with businesses, rather than against them? Finally, does abolishing the strategic advisory board for intellectual property policy, which provides independent and, importantly in the context of the debate, evidence-based advice to Government on IP, mean that they think a strategic approach to IP is no longer necessary?