Artistic Remuneration for Online Content

Debate between David Warburton and Jim Shannon

Wednesday 6th July 2016 Westminster Hall

[Jim Shannon]

If the streaming services become over-regulated, which is what this debate is very much about, it could well be the case that, as the Financial Times has said:

“It is just as likely that consumers would sate their appetites for free content by returning to piracy instead.”

Does the hon. Gentleman share that concern that the Financial Times, and many of us in this Chamber, have?

[David Warburton]

I not only share that concern but think there is a concern that the streaming sites where the content is available for free are, in effect, pirate sites; they are providing the service that pirate sites would otherwise provide. Just because users might be pushed to other pirate sites, that does not mean we should not address sites that seem legitimate and are also providing the service for nothing.

Since YouTube is protected and shielded by safe harbour, other streaming sites find it harder to encourage users to cough up and pay for a subscription. Why would anybody pay if the content is available for free? Fundamentally, there is a clear transfer of value taking place from the content creator to the online provider. If there is an obvious transfer of value, it must be made clear that the online provider has a duty to compensate the creator accordingly. This is not much like the last time the industry faced the digital world. That time the industry closed its eyes, covered its ears and pretended it was not happening, but this time there is little doubt that streaming music is likely to be the key destination for consuming the products of much of the music industry.

The emerging business model is, of course, the subscription service, because it is the ultimate business model—it has clear, definable revenues, near certain cash flows and transparent growth. But as the streaming services see subscription revenues surging and advertising revenues bulging, the artists—the fundamental source of all that—become pretty much forgotten. That is patently wrong, and we must address it.

Government have their part to play. If the concept of active and passive content hosting is included in the Digital Economy Bill—I am sure we all look forward to hearing the Minister’s views on that later—that could well prove to be the answer, preventing active hosts from hiding behind safe harbour. Government must now work with the industry and the platform providers—the streaming services, the hosts and the content providers—to build a consensus and a model that is sustainable for all parties and that, crucially, allows those who uncork and create the joy, upon whose efforts the whole edifice is built and whose sound and fury draws us all in, to be properly rewarded and have proper control over all that they create for the rest of us.