Regulatory convergence - same old question, same right answer

Browsing through the responses to the Communications Review Open Letter in advance of the forthcoming Green Paper, I came across the answer from the Oxford Internet Institute to the posed question "Is regulatory convergence across different platforms desirable and, if so, what are the potential issues to implementation?".    The OII says, very sensibly:

"... it would be a significant mistake to seek regulatory convergence across platforms if this means imposing a model of broadcast regulation on the Internet. It is often assumed that the Internet is a modern era ‘Wild West’, lawless and unregulated. In fact, the opposite is true – there is already extensive regulation of Internet service provision, content and activities. We would argue that traditional regulatory models for broadcasting, common carriers (such as post or telecommunications) and the press cannot be imposed wholesale on the Internet without serious risks to its vitality and its contribution to the UK economy as well as potential chilling effects of speech."

I was reminded of another Green Paper 14 years ago - the European Commission Convergence Green Paper - which raised much the same question.  At the time, alarmed at the possibility that policymakers might unthinkingly apply anachronistic broadcast regulation to the internet, I wrote a piece for the Financial Times (8 April 1998) entitled "Networks without broadcast constraints".  Unblushingly I reproduce it below, if only to suggest that while the question may recur, the right answer remains unchanged. 

“In the 17th century John Milton, in his celebrated Areopagitica, argued against Oliver Cromwell's licensing of books and newspapers. Today,with the rise of the internet, the battle has begun for freedom of the digital networks.

The battleground is Brussels. Last December the European Commission published a Green Paper called "Convergence of the Telecommunications, Media and Information Technology Sectors, and the Implications for Regulation".

Convergence is the phenomenon that, thanks to advances in IT and communications technology, content no longer respects the technical boundaries of telephone, radio, television and cable. The Green Paper identifies the internet as "both the symbolic and prime driver". The Green Paper, open for consultation until the end of April, begins a debate about the regulatory environment for digital content. The outcome is important for traditional print media. As paper content migrates to digital networks, should digital content be licensed and subject to discretionary regulation as if it were broadcast?

Or should it be like print, which in liberal countries needs no licence and whose publishers are answerable only to general laws enacted by democratic institutions and enforced by independent courts ? In the rush to devise policy proposals for the internet, it is easy to assume that it is another variety of new media, which like broadcast should subject to discretionary content regulation.  Even if that could be justified, the analogy is misconceived. Spectrum on the internet is far from scarce. Internet content is not invasive. Every internet user is also potentially a publisher. The US Supreme Court, in the Communications Decency Act case, accepted these differences from broadcast media. It concluded that the net's content is as diverse as human thought and it deserved the highest degree of First Amendment protection.

Even so, digital networks remain at risk of having broadcast regulation imposed upon them. Outside Europe, Singapore has imposed a class licensing scheme for the internet under the control of the Singapore Broadcasting Authority. The UK Broadcasting Act arguably could apply to moving pictures on the net.

If the Broadcasting Act were to be extended to web versions of UK newspapers, they would have to be censored to comply with the Act's requirements of political and public policy neutrality. No editorials on the web. Freedom of speech would be the preserve of an ever-diminishing print rump. The Green Paper does acknowledge the principle of "no regulation for regulation's sake". It rightly points out that the IT industry operates in an unlicensed environment. It mentions that convergence may challenge licensing approaches based on perceived scarcity of radio-frequency and content. It refers to the possibility that different standards may apply to the same content provided over different platforms. It tends to favour lighter regulation. However, as paper content migrates to the networks, the Green Paper pays little attention to the need to preserve the freedom to publish that content without permission from the state.

Nowhere does it suggest a clear principle that licensing and discretionary regulation are inappropriate for content published over networks. Instead the paper tends to emphasise "self-regulatory" approaches that risk verging on government regulation by another name.

It points out that self-regulation for the net may lead to divergent approaches unless co-ordinated to some degree at a community level. So much for diversity - the essence of the internet - as a positive good. Martin Bangemann, EU commissioner, has called for an International Charter for global communications. He also suggested the possible need for a European Communications Act covering infrastructure, services, content and conditions of access.

A recurring theme in the debate is the need to regulate internet content effectively. Mr Bangemann, describing reactions to his call for an international charter, says that some people who are afraid we are heading for anarchy considered the internet something that must be brought under strict control.

The real need is to free the internet and other digital networks from the threat of censorship by licensing and discretionary regulation, and to establish them as subject only to settled laws protecting free speech, enforced by independent judges. If that were embodied in Mr. Bangemann's charter, it would be progress indeed. Achieving it in a world replete with countries whose governments do not value freedom of speech should be the important task for international lawmakers.”

Avoidable ATVOD

Following OFCOM’s ruling in the Sun Video case, what does the future hold for ATVOD? 

ATVOD sees itself as a model for co-regulation, whose expertise can usefully inform the forthcoming Communications Green Paper: 

“Our experience is that co-regulation of video on demand services has proved capable of yielding nimble, economical solutions and the promise of establishing a broad consensus around light touch regulation.” (Letter to Minister for Culture, Media and Sport, 28 June 2011)

Others view it differently.  In July 2011 Lord Clement-Jones criticised ATVOD in Parliament as expensive, too wide in scope, far from light touch and already giving rise to litigation. 

An answer to a Parliamentary question in November 2011 revealed that complaints to ATVOD about audiovisual services were running at about two a day since April 2011.  No complaints had resulted in a finding of breach of content standards.  ATVOD costs around £450,000 per annum, recouped by fees levied on about 150 regulated VOD services.

The question is bound to be asked, come the Communications Green Paper, whether ATVOD should now be given a decent burial.  What purpose is served by an extra layer of content regulation - whether ATVOD-style co-regulation or a full-blown statutory regulator – over and above the general law, especially when funded by imposing substantial costs on a small section of industry?

Are there alternatives?  The UK government does have to comply with the AVMS Directive, which lays down content requirements specific to TV-like audiovisual services.  However those can be enshrined in a few paragraphs of statute, with a sanction such as the ability for a person affected to apply to court for an injunction.  That, in conjunction with a voluntary code of conduct, is how the Irish government has implemented the AVMS Directive.

Subjecting on-demand audiovisual services to an appropriately crafted statute would remove the need for a funded regulatory or co-regulatory body and provide a regime much closer to that applicable to most other speech and content, both generally and on the internet.

An Irish-style approach was never considered when the UK government consulted on the implementation of the AVMS Directive in 2008.  The Communications Green Paper would provide the perfect opportunity to reconsider the need for any regulator at all. 

OFCOM reins in VOD regulator’s reach

ATVOD’s high-profile campaign to bring video sections of newspaper websites under its regulatory wing has hit the buffers. 

Just before Christmas OFCOM ruled, in an appeal from an ATVOD determination, that the Sun Video elements of the Sun website are not a TV-like video on demand service.  ATVOD has promptly dropped similar cases against eight other newspaper and magazine sites.

OFCOM found that ATVOD’s original determination on the Sun site concentrated too much on the part of the in which the video links were collected together, rather than the site as a whole, and were wrong to conclude that the video links were a separate service in their own right.  They were an incidental part of the Sun newspaper site, and it was not possible to identify anything within the site whose principal purpose was the provision of audiovisual material.  OFCOM having reached this conclusion, it did not go on to consider whether the audiovisual material was comparable to a television service.  

OFCOM did address the general question of whether the Sun’s website provided a service that the Directive sought to bring within its regulatory scope.  In particular OFCOM considered Recital 24: whether the nature and the means of access to the service would lead the user reasonably to expect regulatory protection within the scope of this Directive.

OFCOM concluded that the user would not regard the audiovisual material on the Sun website as competing with television programmes, nor expect what he was viewing to be regulated as such. Rather, as far as the written contents of the website and the Video section were concerned, the user would likely regard himself as viewing the electronic version of The Sun newspaper.

The 47 page OFCOM decision gives detailed guidance on the factors that are likely to influence whether provision of audiovisual material is a principal purpose of a website.  These include:

-         Whether the audiovisual material has its own homepage; or by contrast whether it is accessible via a homepage that is styled as providing, and in practice does provide, some other service with its own independent identity

-         Whether, where it is made available on a website providing other content, such as written articles, a significant amount of the relevant audiovisual material is catalogued and accessed via a separate section of the website

-         Whether the audio visual material is presented or styled and marketed as a television channel, e.g. as ‘X TV’

-         Whether a significant amount of the audiovisual material is of a substantial duration and/or comprises complete programmes, rather than bite-sized clips or extracts from longer programmes; and whether it has an independence that means it is watched and fully understood on its own.  Material comprising clips of short duration whose context, meaning and significance is only properly or fully understood by reading accompanying written material is more likely to be ancillary to some other service.

-         The degree to which there are access links between the relevant audio visual material and other content. For example, audio visual material that is an ancillary part of an electronic newspaper is more likely to contain a significant number of links between that material and written articles in the nature of “click to read story/view video”, and/or of videos embedded in written articles.

-         The degree to which there are content links between audiovisual material and other content. For example, audio visual material that is an ancillary part of an electronic newspaper is more likely to be the basis or subject matter of written articles, to be an audiovisual version of the written article or an amplified or enhanced experience of that article; and the audio visual material does not need to be watched for the user to receive the information the service seeks to convey.

-         Where the service provides audiovisual and written material:

(a)  the balance between the two kinds of material, in terms of quantity and/or prominence

(b)  whether the written material is brief and/or merely an introduction to, or summary of, the audio visual material or, by contrast, has significant length and depth; and

(c)   whether the audiovisual material is the primary means of conveying to users the information sought to be conveyed

-         Whether on an overall assessment the audiovisual material can or cannot be said to be integrated into, or ancillary to, another service. In particular, whether the material can reasonably be described as intended specifically to allow the viewing public to benefit fully from, or to interact with, information provided as part of some other, primary, service.

None of the specific factors is determinative. The service has to be considered in the round.   For instance, even though the Sun Video section was at one time branded as Sun TV, that alone was not enough to bring it within regulatory scope; nor was the fact that the Sun Video section had a cataloguing function.

While the OFCOM ruling leaves open the possibility that in some factual circumstances a newspaper site might contain a separate regulated video service, it does significantly restrict ATVOD’s regulatory reach.  Following OFCOM’s ruling the ATVOD Chief Executive Pete Johnson said:

“Most people will recognise that defining the scope of new regulations in a fast-moving market is a complex and difficult task. The appeal system is a vital part of the process, giving users and providers of video on demand services greater clarity over where the new protections for consumers do and do not apply. … We will now reflect further on the appeal judgement and consider any implications it may have for any other past and future rulings on whether a service falls within ATVOD’s remit.”