Pi and CHIPs

Posted on May 19th, 2015 by



Pi and CHIPs

Californian Tech start-up Next Thing is seeking funding to take to market its CHIP computer, which costs just $9 (£6) in its most basic form. Launched through a Kickstarter campaign on 7 May 2015, the project quickly provoked interest and has already exceeded its $50,000 funding goal. (At the time of writing, backers have pledged over $1m.) According to Next Thing, the CHIP is “built for work, play, and everything in between.”

The first versions will contain a 1 GHz processor, 512MB of Ram and 4GB of onboard storage. Graphics will be delivered on the same platform used for most Android phones, connecting to monitors and displays through standard basic connectors.

Prototype CHIP computers are due to be available to backers in December this year, though some are likely to be made available to certain core backers as early as September.

The CHIP, excepted to be launched in 2016, shares many of its technical aspects with the Raspberry Pi, but it represents a developmental step forward, as it has networking capabilities such as Wi-Fi and Bluetooth 4.0 that are not available on the standard Raspberry, which will make it a strong rival to the Pi.

However, while the basic model is advertised, to much acclaim, as being the first computer on sale for less than $10, the low price tag covers only the basic board, and experts anticipate that a handheld version, made more workable with necessary add-ons, will retail for approximately $49. Whether the CHIP proves more popular than the Pi will depend on more than price, as comparison of technical specifications will be consumers’ primary concern. CHIP has a better processor than Pi, and offers integral storage, built-in Wi-Fi and Bluetooth, which the Pi does not have. However, while delivering a device with these added features, reductions in cost and size have been achieved by compromising in other areas, such as quality of graphics, and only one USB port.

Chip also has a portable peripheral add-on called the Pocket Chip. The device includes a 4.3-inch touchscreen, keyboard, and battery. However, at $40, this device is another add-on which erodes the big talking point of the CJIP- its low cost.

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Is it OTT to say Digital Single Market Strategy is an ambitious overhaul of the telecoms regulatory framework?

Posted on May 11th, 2015 by



Last Wednesday the European Commission released its Digital Single Market Strategy (please see our in-depth commentary on this release), and in doing so confirmed its intention to overhaul the telecoms regulatory framework. The exact nature of these proposals will not be presented by the Commission until 2016, however these reforms will focus on:

  1. a consistent single market approach to spectrum policy and management;
  2. delivering the conditions for a true single market by tackling regulatory fragmentation to allow economies of scale for efficient network operators and service providers and effective protection of consumers;
  3. ensuring a level playing field for traditional telcos and over-the-top (“OTT”) players with consistent application of the rules;
  4. incentivising investment in high speed broadband networks (including a review of the Universal Service Directive); and
  5. a more effective regulatory institutional framework.

 

The adoption of the Connected Continent Package is seen as a first essential step in the Digital Single Market reform process. The initial Connected Continent Package was released in September 2013 by Neelie Kroes, former European Commissioner for Digital Agenda, with a real sense of urgency. This initial package was heralded as the big picture vision necessary for Europe’s strategic interest, economic progress and the telecoms sector itself.

The current Connected Continent Package proposal has been significantly pared back since its debut in 2013, with only two elements remaining, net neutrality and mobile roaming. Initial elements of the Connected Continent Package that fell by the wayside appear to be making a resurgence under the latest Digital Single Market reform strategy, including spectrum policy, reform of the regulatory institutional framework and high speed broadband networks.

However, Member States have repeatedly voiced serious concerns regarding these elements. The Presidency progress report on the Connected Continent Package released in May 2014 noted that the Member States were worried about red tape, the impact on the existing structures (including NRAs) and investment into infrastructure, the consequences of the consolidation of the market for the effective competition and also about the shift of balance of power between the Commission and the Member States. It will be interesting to see how the European Commission intends to address these issues in its future reforms second time around.

What is new is the objective to ensure a level playing field for all market players, targeting OTT service providers. OTT service providers are not currently regulated in the same way as traditional telco players, as they fall outside the scope of rules regarding electronic communication services. How the Digital Single Market reforms intend to address the current asymmetric telecoms regulation will be proposed in 2016.

Whether or not the European Commission’s rhetoric and “ambitious legislative steps towards a connected single digital market” will match the reality over the next year (or several years) will be yet another case of wait and see. In the meantime, we will continue to monitor the discussions of the Connected Continent Package with the European Parliament in the coming months.

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Finally, some certainty around Europe’s Single Digital Market Strategy

Posted on May 7th, 2015 by



If you haven’t already spotted it among the leaks, tweets and general pre-announcement noise, today the EU released its Digital Single Market Strategy. In an orchestrated tweet-fest the clunky machine of the EU ventured online endlessly pronouncing “let’s go digital with European #DigitalSingleMarket thndr.it/1NqDGe4“. All the fanfare and hype was for a new Strategy “A Digital Single Market for Europe“.

The back-drop; a fear Europe is falling behind, a slow awakening to the inevitable truth – the Internet and digital technologies are transforming our world. Dealing with such technologies across 28 different Member States is at best extremely complex and frequently simply impossible. And yes, perhaps sometimes, the humble consumer is overwhelmed and exploited in order to deliver online gains for others.

With the inevitable echo of previous proposals and consultations there are some new ideas within this Strategy. However, there are no immediate actions and the often the decisions or actual details remain some way off. What’s clear is an aim to agree proposals this year. Of course, proposals are not law, and any new online laws remain years away. However, it’s indicative of a focus and direction for EU digital regulation and anyone with an interest in the EU’s online environment has to start paying attention.

The EU alive to new concerns

The steady progress and growth in the digital economy, notably from the US, keeps the EU policy makers awake at night. The Commission sees the value of digital and technology but not yet a sustainable internal market to foster its adoption. Just what can be done to claw-back this US lead and to foster more digital innovation? Where’s our EU-bred eBay or Amazon or at least a sharing economy giant, must we search and interact only via US platforms and is there a way to foster an EU-cloud and greater fairness for rights-holders? Does the EU’s market fragmentation inhibit growth in Europe in comparison to the single markets on offer in the USA or China? Or are there other reasons for all the US online success?

The EU’s concept for the #DigitalSingleMarket is not new but this May 6th 2015 communication sets out a wide ranging agenda for change across issues such as copyright, e-commerce, telecoms regulation and, of course, data.

Three Pillars of Wisdom: the Commission sets out 16 initiatives to make it happen

Hats off to #TeamJunkerEU they’ve planned the Strategy launch well. Video, infographics, commentary and carefully crafted press-releases each provide their overview of why “Europe must embrace the digital revolution and open up digital opportunities for people and businesses“. They have one pre-exiting policy tool to achieve this for Europe: “By using the power of the EU’s Single Market“.

The Digital Single Market Strategy published today includes a set of targeted actions to be delivered by the end of next year. It is built upon three core pillars:

  1. better access for consumers and businesses to digital goods and services across Europe;
  2. creating the right conditions and a level playing field for digital networks and innovative services to flourish; and
  3. maximising the growth potential of the digital economy.

There are 16 key actions to be delivered by the end of 2016

The European Commission unveiled 16 key actions as a part of its Strategy to create a Digital Single Market. These 16 actions sit under the 3 pillars mentioned above and we’re told comprise its “top priorities“. According to these 6 May 2015 releases, the Commission’s 16 key actions comprise:

PILLAR I: Better access for consumers and businesses to digital goods and services across Europe

  1. Rules to make cross-border e-commerce easier. This proposes harmonised EU rules on contracts and consumer protection when EU consumers buy online. As ever this is about the EU’s long-running aim to boost online confidence. However, it feels like another layer of proposals in an already highly regulated area. EU rules demand simplicity, plain and intelligible language and then inundate the online world with volumes of mandatory disclosures (think last year’s Consumer Rights Directive implementation). What’s more, this could challenge the only recently adopted principles enshrined in the UK’s Consumer Bill of Rights (not yet even in force but a great example of a Member State bucking the trend of harmonisation) and perhaps the lead to a rebirth of the single EU consumer contract law?
  2. To enforce consumer rules more rapidly and consistently. In this instance, they’re proposing a review of the Regulation on Consumer Protection Cooperation. This Regulation already aims for cooperation between EU authorities (believed to be essential to ensure that consumer rights legislation is equally applied cross the internal market and to create a level playing field for businesses) but we all know there is far more risk of online enforcement in certain EU Member States than others. To be fair, if coupled with more uniformity around rules perhaps this will help an online player understand obligations and risks and effectively address the single market?
  3. More efficient and affordable parcel delivery. The Commission has made much of the fact that currently 62% of companies trying to sell online say that parcel delivery costs that are too-high are a genuine trade barrier. Another hint toward the need to unify Europe’s fragmented national delivery networks – whether this is easy to achieve remains to be seen.
  4. To end unjustified geo-blocking. Geo-blocking is another one of those issues subject to a high volume of pre-briefing. So much so, the Fieldfisher team has previously explained the perceived concern around this issue. Equally the focus in the Strategy around territorial rights management and geo-blocking was anticipated and we’ve recently published some research into industries general perceptions in this area.This proposal is also a nod to what the EU sees as “discriminatory practice used for commercial reasons, when online sellers either deny consumers access to a website based on their location, or re-route them to a local store with different prices”. This kind of blocking activity means that, for example, car rental customers in one particular Member State may end up paying more for an identical car rental in the same destination.
  5. To identify potential competition concerns affecting European e-commerce markets. Our anti-trust and competition team have also recently explored this issues and today the Commission launched an anti-trust/competition inquiry into the e-commerce sector in the European Union. “The sector inquiry will focus particularly on potential barriers erected by companies to cross-border online trade in goods and services where e-commerce is most widespread such as electronics, clothing and shoes, as well as digital content.” More gloss is provided in this press-release but the information gathered as a result of these enquiries may well lead to better insights enabling the EU to take further actions.The problem identified is that, of those shopping online, only 15% of consumers reached across to an e-vendor in another Member State. Can currency and language differences account for all of this? What are the other inhibitors? As a next step questionnaires will be sent to companies ranging from content rights holders, broadcasters, and manufacturers to merchants of goods sold online and the companies that run online platforms such as price-comparison and marketplace websites. Please get in touch if you’re the recipient of any such investigation.
  6. A modern, more European copyright law. Here we’re told that legislative proposals will follow, before the end of 2015, these which will endeavour to reduce the differences between national copyright regimes and allow for wider online access to works across the EU, including through further harmonisation measures. The fact that wider international rules may also need agreement seems to be ignored.In particular, the Commission wants to ensure that users who buy films, music or articles at home can also enjoy them while travelling across Europe. The Commission will also look at the role of online intermediaries in relation to copyright-protected work. It will step up enforcement against commercial-scale infringements of intellectual property rights.The principle of “intermediary liability” (that online intermediary service provides should not be liable for the content they transmit, store or host) has become somewhat sacrosanct since introduced under the Ecommerce Directive (2000/31/EC). However, its application is not always clear, EU court cases within Member States have led to fragmented rules and, despite consultation in 2010 and some EU responses in 2012, the EU still does not have a consistent “notice and action” policy leaving rights holders and online intermediaries to juggle a variety of national approaches. Before the end of 2015, perhaps the EU’s approach to the role of Internet platforms will be clearer? Perhaps it has wider plans for the intermediaries to have a more active role in respect of IPR online?
  7. A review of the Satellite and Cable Directive. In this instance, the review will assess if the existing Directive’s scope needs to be enlarged to include broadcasters’ online transmissions and to explore how to boost cross-border access to broadcasters’ services in Europe.
  8. To reduce the administrative burden businesses face from different VAT regimes. To implement steps so that sellers of physical goods to other countries also benefit from single electronic registration and payment; and with a common VAT threshold to help smaller start-ups selling online. To be clear, these proposals do not seem to go as far as proposing a uniform VAT rate (even Europe couldn’t reach that far into Member State’s macro-economic policy).


PILLAR II: Creating the right conditions and a level playing field for digital networks and innovative services to flourish

  1. Present an ambitious overhaul of EU telecoms rules. These plans include the Commission’s aspiration for more effective spectrum coordination (perhaps with an eye on the Internet of Things and spectrum allocation issues we’ve explored in the past, but also with recognition that these services are “the backbone for digital products and services“).There is commentary around the need for a common EU-wide criteria for spectrum assignment at national level; creating incentives for investment in high-speed broadband; ensuring a level playing field for all market players, traditional and new; and creating an effective institutional framework.
  2. Review the audiovisual media framework to make it fit for the 21st century. Here the Commission are focusing on the roles of the different market players in the promotion of European works (TV broadcasters, on-demand audiovisual service providers, etc.). The strategy will also explore how to adapt existing rules (set out in the Audiovisual Media Services Directive) to new business models for content distribution.
  3. Comprehensively analyse the role of online platforms (search engines, social media, app stores, etc.) in the market. These investigations by the Commission will cover issues such as the non-transparency of search results and of pricing policies (or so called “search neutrality” or “pricing neutrality”), how the online platforms use the information they acquire, relationships between platforms and suppliers and the promotion of their own services to the disadvantage of competitors – to the extent these are not already covered by competition law.Related in part to the intermediary liability issues mentioned above, we’re told this analysis will also look into how to best tackle illegal content on the Internet.
  4. Reinforce trust and security in digital services, notably concerning the handling of personal data. Of course, although painfully slow, privacy reform in the EU is already well underway and our privacy team is frequently providing updates on these developments. However, building on the new EU data protection rules (which they still claim are due to be adopted by the end of 2015 (?!)), the Commission will review the e-Privacy Directive (2002/58/EC). So cookies, e-marketing and online transparency rules may also get a review. And this just as many businesses had got to grips with the current regime and its demands.
    The full Strategy sets out new aspirations to move further towards “Building a data economy“. It states “Big data, cloud services and the Internet of Things are central to the EU’s competitiveness. Data is often considered as a catalyst for economic growth, innovation and digitisation across all economic sectors, particularly for SMEs (and start-ups) and for society as a whole.” Perhaps worryingly, there is more rhetoric about the lack of contractual protection in cloud relationships and cloud provides severely limiting liability and future portability of data. We can only assume the efforts to codify and standardised contracts and vendor behaviour within the “Cloud Agenda” will continue.We’ll explore the potential impact for cloud in a later post.For now, if you detect a tone of cynicism, that’s because I feel as if we’ve been here a number of times before. I became quite caught up in the EU’s 2012 Cloud Agenda “Unleashing the Potential of Cloud Computing in Europe“. Great aspiration from past leaders of the European Commission following their steady realisation that that, without public intervention, the EU’s already endangered cloud industry would not reach its full potential. Launched in 2012, it’s now mid-2015 and we’ve a lot of consultation and group break-out but still little concrete progress (and certainly no law). I’ve previously explained a little of the rhetoric and output of that Cloud Agenda during previous commentary on cloud SLA proposals.
  5. Propose a partnership with the industry on cybersecurity in the area of technologies and solutions for online network security. There is of course already an almost finalised draft of the Network and Information Security Directive but the Strategy also highlights the European Cybersecurity Strategy and plans to develop industrial and technological resources for cybersecurity. For a comparative commentary of the EU versus US approaches see this piece written earlier this year.

PILLAR III: Maximising the growth potential of the digital economy

  1. Propose a ‘European free flow of data initiative’ to promote the free movement of data in the European Union. The rhetoric here from the Commission is not necessarily new, it believes “new services are hampered by restrictions on where data is located or on data access – restrictions which often do not have anything to do with protecting personal data“. This new initiative will tackle those restrictions and so encourage innovation.Apparently the Commission will also launch a European Cloud initiative covering certification of cloud services, the switching of cloud service providers and a “research cloud”. Again, we’ll share more here in due course.
  2. Define priorities for standards and interoperability in areas critical to the Digital Single Market: this apparently will include areas such as e-health, transport planning or energy (and notably smart metering).

And finally…..

  1. Support an inclusive digital society where citizens have the right skills to seize the opportunities of the Internet and boost their chances of getting a job. This appears to comprise a new e-government action plan will also connect business registers across Europe, Importantly perhaps for our readers; this may include an acceleration in the roll-out interoperable e-signatures.

More of the same?

The main take home, not least for the US based reader, is that this is not new law. It may, in time lead to new EU laws but they are a good way off for now. There are however clear proposals to investigate and potentially change things which already trouble the US business tackling the European markets: effective consumer terms and rights; rules and constraints for cloud contracts; reform of e-marketing; and changes to the rules around the use and processing of data. This is not really news and has been on the agenda in the past. There is inevitably uncertainty whether you can ever legislate an entire industry back into a competitive position.

And no super-regulator?

Much is made of the need for a single market and certain recent commentary speculated this may lead to the formation of a “super-regulator” tasked with EU-wide enforcement around telecoms, technology and online presence. Yet, it seems for now at least, this was perhaps a step too far. Only last week we learned that this “didn’t get political backing“. Whilst perhaps this is a piece of good news for certain US online behemoths, with the new competition enquiries the Strategy may yet lead to regulatory investigation. The absence of such proposals does however beg the obvious question: how do you actually ensure these aspirations are enforced and regulated? Particularly across borders (though see action point 2 for the Commission’s hopes there).

Inappropriate focus on the US platforms

Inevitably this Strategy will draw criticism from some quarters that much is aimed squarely at US online platform dominance and inhibiting the ability of US online dominance. Of course the investigation into potential competition concerns affecting European e-commerce markets may draw such fire and potentially the intermediary liability (see below) and search neutrality investigations could create problems for the US players. More subtle perhaps is any changes in the cloud space and almost everything that attempts to regulate the movement or processing of online data. Europe clearly believes the US providers don’t always play “fair” around practices relating to and their contracts with European customers. Time will tell us just how many of the day-to-day operations and practices of the US players will be impacted.

What about proposals for significant changes around online “duty of care”?

Perhaps the sea-change I see as the most significant is in relation to the proposals falling under priority number 6: i.e. those for “new measures to tackle illegal content on the Internet“. Notice and Action reform has been long-promised. But how far will the new investigation into “whether to require intermediaries to exercise greater responsibility and due diligence in the way they manage their networks and systems – a duty of care” take us from the current regime of safe harbour defences under the Ecommerce Directive?

Is this a step towards pro-active monitoring, could the similarities with the US and the DMCA finally be eroded away? What may these enhanced responsibilities lead us towards? If only addressing issues of child pornography or terrorism, perhaps this can be understood – but are the online intermediaries going to be asked to police the Internet? This is an area where online platforms providers should maintain a keen eye.

Europe’s inferiority complex

Some of the Strategy is about Europe’s need to create jobs and the need to facilitate a market where Europe’s businesses can compete on both the home (yes perhaps there is a whiff of protectionism) and global stage. There is inevitably the consequence that some things which online businesses have adapted to and learned to deal with will now change or evolve. There’s likely to be more digital regulation not less in the coming years.

There is clearly appetite to move forward around the #SingleDigitalMarket and the next weeks and months will reveal just how much momentum these 16 policy objectives can gather.

One thing is clear; this is a new leadership team with strong views. The buy-in at Commission level comes right from the top. In fact the press-release quotes Commission President Jean-Claude Juncker who remarks:

Today, we lay the groundwork for Europe’s digital future. I want to see pan-continental telecoms networks, digital services that cross borders and a wave of innovative European start-ups. I want to see every consumer getting the best deals and every business accessing the widest market – wherever they are in Europe. Exactly a year ago, I promised to make a fully Digital Single Market one of my top priorities. Today, we are making good on that promise. The 16 steps of our Digital Single Market Strategy will help make the Single Market fit for a digital age.”

What now?

The Single Digital Market Strategy promises: “The Digital Single Market project team will deliver on these different actions by the end of 2016. With the backing of the European Parliament and the Council, the Digital Single Market should be completed as soon as possible.” This will first be aired by the European Council in meetings on the 25th June 2015.

At the fore is a desire to champion and protect the consumer. As with the General Data Protection Regulation, perhaps underneath all this the US, Silicon Valley and the general success of its internet and online platforms in the EU markets is in the firing line. We all know these privacy law reform proposals have struggled to emerge and, even today, remain some way from agreement and becoming law. The constant leaking and previewing is over – will they now be able to deliver and advance any of these promises?

Perhaps the only certainty: this digital overhaul is likely to play out at analogue speed.

Mark Webber – Fieldfisher Silicon Valley Office

Mark.webber@fieldfisher.com

For further comment and insight follow me on twitter @digitechlaw

 

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Solving the Challenges of User-Centric Networks

Posted on May 5th, 2015 by



At Fieldfisher’s recent telecoms update conference, I spoke of what I believe to be the key necessities for the next generation mobile network, and described the ‘seven pillars’ for 5G development (maximising data rates; minimising latency; speed of mobility; seamless transition between technologies and at cell boundaries; spectral efficiency; maximising simultaneous connections; and lowering cost and energy consumption per unit of data). The network of the future is expected to be all about quality of experience for the user, driven by the media consumption habits of users, and shaped by the appearance of new technologies.

We have just published an article on our website which describes some of the challenges faced by network operators and regulators, and explores some of the possible solutions. The article can be found at the following link – http://goo.gl/ICulJI.

 

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European Parliament votes in favour of eCall Regulation

Posted on May 1st, 2015 by



Earlier this week on 29 April 2015, the European Parliament voted in favour of a new eCall Regulation which makes it mandatory from April 2018 for all new passenger cars and trucks sold in the European Union (‘EU’) to be equipped with eCall technology. The legislation was originally proposed by the European Commission on 26 November 2012 and its purpose is to ‘help mitigate the consequences of serious road accidents across the EU‘ and in doing so ‘save hundreds of lives every year and help injured people quicker‘.  

What is eCall technology?  

A vehicle that is fitted with an eCall device will automatically call 112 – Europe’s single emergency number – in the event of an accident. The car will use in-vehicle sensors to detect whether an accident has occurred (i.e. if the airbags have been deployed) and a ‘minimum set of data’ would be sent to the nearest emergency services centre.

This information will be sent even if the driver is unconscious or unable to make a phone call and will include the vehicle’s exact location, the time of the incident and the direction of travel. In addition, the eCall device remains dormant until it detects an accident or it is triggered manually by pushing a button in the vehicle (i.e. by a witness at an accident).

What are the potential benefits?

The development of eCall started approximately four years ago, and in its testing the EU has compiled statistics regarding its benefits, one of which is that emergency response time “…goes down to 50% in the countryside and 60% in built-up areas” – demonstrating that eCall has the potential to save hundreds of lives and reduce the severity of injuries.

In addition, the EU has emphasised that eCall could assist in reducing the congestion caused by traffic accidents and in reducing secondary accidents.

What are the key concerns?

As eCall technology primarily concerns the processing of data relating to individuals, the EU has received numerous concerns from citizens that by having eCall installed in their vehicles, their location will be continuously tracked, their driving habits monitored and their privacy infringed.

In light of the ongoing discussion concerning the EU Data Protection Regulation, the EU has been particularly keen to address citizens’ privacy concerns associated with the use of eCall and issued a guidance note in June 2014 clarifying the position. The guidance note emphasised the following:

  1. the data sent to the emergency services centre are only those strictly needed by the emergency services to handle the emergency situation and may include whether the vehicle is automatic or manual, the vehicle identification number, vehicle type, vehicle direction, current and previous position and number of passengers;
  2. the data are transmitted and stored by the emergency services in compliance with relevant legislation on personal data and consumer protection;
  3. the data will not be stored any longer than is necessary; and
  4. eCall lies dormant until activated, so it does not allow vehicle tracking.

 

Other concerns relating to eCall include:

  1. hacking – if the eCall system was to be hacked, detailed information about the driver’s location and journey details would be available;
  2. exploitation by insurance companies – the presence of eCall in all new cars and its ability to record information means that it could be potentially exploited by insurance companies who may charge higher premiums for insuring cars, if people are able to opt out of installing eCall; and
  3. law enforcement use – the data collected by eCall could be used by the police to track motorists.  

 

So what happens next?

The text of the eCall Regulation will be published in the Official Journal of the European Union and will enter into force 20 days thereafter. Following this, the industry will need to ready itself for the change in the law to ensure it can meet the April 2018 deadline.

If you would like to discuss how eCall will impact your business and the legal and commercial issues in more detail, please contact me.

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EU Commission’s draft Digital Single Market strategy leaked

Posted on April 30th, 2015 by



EU Commission’s draft Digital Single Market strategy leaked

The EU Commission is due to release its Digital Single Market Strategy and supporting Evidence on 6 May 2015, but copies of the draft Strategy were leaked last week, which have provided an unexpected insight into the direction that Single Market will take.

The Strategy seeks to ensure that the Digital Single Market is truly “single”, so that the Single Market is realistically reflected in the digital world. The Strategy claims that bringing down the remaining barriers to a single market could contribute an additional €340bn to the European GDP.

The stated aims of the EU Commission are to create “a Digital Single Market as an area where the free movement of goods, persons, services and capital is ensured and where citizens and businesses can seamlessly access and exercise online activities under conditions of fair competition” helping to “restore Europe as a world leader in information and communications technology, with all the tools and skills required to succeed in the global digital economy.”

The Strategy identifies the principal remaining barriers to a Digital Single Market as being disparities between Member States’ contract law regimes, absence of affordable and high quality cross-border parcel delivery services within Europe and, finally, what the Commission perceives to be unfair discrimination against consumers when accessing content or buying goods and services online due to their nationality, residence or geographical location, within the borders of the EU.

Legislative Proposals

The draft document announces legislative proposals to address “unjustified geo-blocking … practices that result in the denial or limitation of access to websites or products and services in other Member States“; copyright reform, by allowing text and data mining and improving measures for civil enforcement; and the role of intermediaries.

Timeline for implementation

The Annex to the Strategy sets out the proposed timeframe for accomplishing the steps leading toward legislative change. Proposals for copyright reform and cross-border access will be tabled in 2015, and detailed analysis of the role of online platforms in the market and initiation of steps to tackle illegal content on the internet will take place in 2016.

 

DCMS Digital Communications Infrastructure Strategy

The leaked DSM Strategy will be particularly interesting in light of the Digital Communications Infrastructure Strategy published by the Department for Culture, Media & Sport (DCMS) last month.

Further to the Terms of Reference of the Digital Communications Infrastructure Strategy, published on 6 February 2014, DCMS published on 18 March 2015 a Policy Paper outlining its long term digital communications infrastructure strategy.

This Policy Paper details the government’s commitments to assist market investment and to cut legislative and regulatory red tape.

DCMS comments that the government’s “headline ambition” is that ultrafast broadband of at least 100 megabits per second should be available to nearly all UK premises, ensuring that “rural communities are not left behind”.

Background to the Policy Paper

DCMS comments that superfast broadband coverage will be available at 95% of premises in the UK by 2017, with mobile operators achieving 98% 4G coverage, continuing policy set in motion in 2013 by the government funding of the 2.6GHz and 800MHz spectrum auction. With increased availability of the 4G spectrum, DCMS comments that improved broadband connectivity will bring service for rural communities into line with that available in urban areas.

The government proposes to future-proof the coverage, capacity and quality of the 4G network, and DCMS has been tasked with delivery of this proposal. In the 2015 Budget George Osborne announced government allocation of up to £600m to support the change of use of the 700MHz spectrum, improving mobile broadband connectivity. The funds will support the infrastructure costs of clearing the spectrum frequency, any necessary support to consumers, and retuning broadcast transmitters to enable broadcasters to move into a lower frequency. DCMS intends that, following this, the 700MHz spectrum for 4G mobile communications use will be auctioned by the next Parliament.

The government has prequalified the expansion of Virgin Media’s ultrafast broadband network for the UK Guarantees Scheme, supporting Virgin’s proposed £3bn investment. DCMS announces that it is actively engaging with broadband operators to explore how the remaining capacity within the Scheme can be used to support and accelerate further investment programmes.

Hope at last for rural business?

Research published in January 2015 by the Federation of Small Businesses (FSB) found that 49% of rural small businesses are dissatisfied with the quality of their broadband provision, compared to a far lower level of dissatisfaction (28%) in comparable urban businesses. Common complaints include unreliability and slow upload and download speeds – problems that are set to worsen as small firms become increasingly reliant on a high quality broadband connection to do business.

The FSB’s research concludes that the current lack of effective broadband infrastructure serving small firms threatens the expansion of the rural economy currently worth £400bn annually. The business opportunity includes 28% of all UK firms and over one million small businesses.

Mike Cherry, National Policy Chairman for the Federation of Small Businesses, said:

“This research paints a worrying picture of a divided business broadband landscape in the UK and, unless addressed, highlights a clear obstacle to growth in the coming years. We risk seeing the emergence of a two-speed online economy resulting from poor rural broadband infrastructure. A reliable Internet connection is now viewed as a key business requirement by 94% of small UK businesses, yet continued poor connectivity in rural areas represents a huge missed opportunity for economic growth in these parts of the country. ”

Rural Strategy

The Policy Paper addresses the need for high-speed broadband in rural areas, with specific recognition its essential role in “balancing the economy and levelling the economic playing field for businesses in rural areas”

The Policy Paper reports government investment of £1.7 billion in rural broadband development, set to take superfast broadband to 95% of premises by 2017.

Viable solutions, or reinforcing easy wins?

A reliable internet connection is now viewed as a key business requirement by 94% of small UK businesses, yet continued poor connectivity in rural areas represents a huge missed opportunity for economic growth in these parts of the country.

Organisations as diverse as the FSB and the Countryside Alliance are agreed that the government’s target to deliver 24Mbps broadband to “nearly all” by 2017 is “not sufficiently ambitious”, especially for rural businesses left receiving “just 2Mbps, which is barely sufficient for even basic usage.” These organisations, as well as rural businesses and individuals, are unlikely to be satisfied while broadband improves for many, but the status quo remains unchanged where improvement is most needed.

The government’s claims of concern for aiding rural businesses by improving broadband connection are also likely to ring hollow in light of the government’s decision in August 2014 to specifically exclude rural businesses from its broadband grant scheme. DCMS’s Broadband Connection Vouchers allow SMEs in cities across the UK to apply for grants of up to £3,000 to upgrade their broadband connection. This scheme is to be extended under the Policy Paper, rolling out the scheme to an additional 28 cities, taking the total to 50 cities; however, this is unlikely to be any panacea, as the core problem of little or no broadband connection in rural areas remains unaddressed.

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Balancing Payments between Broadcasters and Platforms

Posted on April 16th, 2015 by



Cable operators who retransmit public service broadcasts live over their cable networks are likely to lose the benefit of an existing copyright exception. The exception (under s.73 of the UK’s Copyright Designs and Patents Act 1988 (CDPA)) means that “qualifying” cable retransmissions do not infringe copyright in the broadcast or in any copyright work that is included in the broadcast, and therefore do not give rise to copyright licence fees. The Department for Culture, Media and Sport (DCMS) has said that it views the exception as out-dated and is committed to removing it.

This copyright exception has been the focus of long-running and ongoing litigation between a number of public service broadcasters and TV CatchUp (TVC) over the online provider’s interception and near-live streaming over the internet of public broadcasts. In October 2013, the High Court ruled that:

  • a website operator who intercepts and live-streams a TV broadcaster’s signal on the Internet is “communicating the copyright works to the public”, which must be authorised by the copyright owner, but;

  • TVC’s streaming of public service broadcasts via the internet (but not via mobile networks to mobile devices) would be covered by the “cable retransmission” exception and not infringe copyright, as long as the streaming/retransmission was confined to users in the same region as the original broadcast.

More recently, the case has (for the second time) been referred to the Court of Justice of the European Union, and the English Court has sought clarification on whether the exception under s.73 is compatible with Article 9 of European Copyright Directive 2001/29/EC.

Our sister intellectual property blog – “SnIPpets” – has recently published a piece on the Court of Appeal decision in the TVC case.

Broadcasters and platforms are interdependent in the television delivery value chain which combines a wide range of content, a variety of business models, and a number of distribution technologies (and numerous device types). Platform operators generally offer a bundle of channels in exchange for either a one-off fee (such as the purchase of equipment) or on a subscription basis, and require content to be delivered on those channels to derive value. On the other side of the table, it is key to every broadcaster that their content reaches its intended audience, particularly as each broadcaster (the BBC being the exception) derives income from advertising or other commercial revenues – this has to be done through the platforms.

Within such a complex and high-value sector, the balancing act between the interests of the broadcasters; platforms; and the general public, requires careful policymaking and regulation to support those policies. It is on this basis that, the UK government has recently announced its intention to abolish s.73 CDPA.

DCMS points out that s.73 was introduced to support the development of analogue cable infrastructure in the 1980s/90s. Its view is that s.73 is no longer relevant in today’s multi-platform/channel environment. DCMS has therefore put out a public consultation asking for views on the impact of getting rid of the s.73 exception, and how its removal might impact other policy options raised in the paper.

One possible result of the removal of s.73 is an increase in the flow of revenue from platform operators to broadcasters. However, the government recognises that in a complex industry this may not necessarily be the case. One thing that is likely is that broadcasters and platform operators will hold strong views on this topic, and that any change in the law will provide both opportunities and challenges for industry players.

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Consumer Rights update

Posted on April 8th, 2015 by



The Consumer Rights Act is now law, having received royal assent on 26 March 2015.  Most of the Act comes into force on 1 October 2015 (the secondary ticketing provisions come into force in two months’ time).

As we’ve previously reported,[1] the Consumer Rights Act consolidates UK Consumer Law into one statute and provides consumers[2] with statutory rights to a refund or repair for faulty goods. One key change is the introduction of a 30 day period to return faulty goods, and replacement rights for faulty digital content (i.e. apps, ebooks, and media downloads).

The Trading Standards institute recently issued guidance on the Act for businesses, which includes suggested point-of-sale wording for digital downloads.  Additionally, the Competition and Markets Authority (“CMA“)  recently issued guidance on how it will enforce its consumer powers.  The Financial Conduct Authority (“FCA“) removed its guidance to unfair contract terms from its website, and states that those materials no longer reflect the FCA’s views on unfair contract terms.  The FCA has indicated that it will update these materials in light of the new Consumer Rights Act and in light of the CMA’s guidance consultation on the bill.

Also in the consumer law space, alternative dispute resolution (“ADR“) is set to be given more prominence in resolving online consumer disputes with the UK Government introducing regulations to implement the EU Directive on Online Dispute Resolution (“ODR“) (Regulation (EU) 524/2013).[3]  From July 2015, where a consumer dispute relating to an online transaction cannot be resolved in-house, traders will be obliged to direct consumers to a certified ADR scheme.  However, ADR will only apply where the parties agree to use it – the regulations don’t compel parties to use ADR. The EU ODR Regulation also provides that an EU-wide online platform will be set up to cater for disputes arising from online transactions.  This platform will provide a means for parties who agree to ADR (again, there’s no obligation for parties to use the platform, or to use ADR) to contact certified national ADR entities to resolve their disputes.  All businesses which sell goods or services online will need to provide a link to this platform.

The Consumer Rights Act comes at a time of significant change in the regulatory enforcement landscape in the UK. Watch this space for more guidance on how the Act is enforced in practice from BIS, and case studies of enforcement actions undertaken by the CMA and other bodies such as the Consumers’ Association and local Trading Standards bodies.

 

[1]  We’ve been tracking the Act’s passage through parliament – see Draft Consumer Rights Bill Published, E-Commerce Law Update: UK government publishes new draft consumer regulations, The Consumer Rights Bill – a digital revolution?, BIS concerns over the draft Consumer Rights Bill, and Consumer rights for digital content closer to becoming law.
[2]’Consumer’ is defined as an individual acting for purposes which are wholly or mainly outside that individual’s trade, business, craft or profession.  The trader bears the burden of proof to show an individual is not a consumer.

[3] The Government is implementing the EU ODR Regulations through two regulations – (1) The Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015, which was laid before Parliament on 17 March 2015, and (2) a second Regulation which will be introduced in Summer 2015.

 

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European Court of Justice rules on the protection of live internet broadcasts

Posted on March 27th, 2015 by



The Court of Justice of the European Union (the CJEU) yesterday issued a judgment in relation to rights in live internet broadcasts (C More Entertainment AB v Linus Sandberg C‑279/13)

Impact of the Ruling

The ruling clarifies that:

  1. Across all EU Member States, broadcasters have exclusive rights to control “on-demand” transmissions of their broadcasts.
  2. There is nothing at an EU Directive level that prevents Member States from protecting broadcasters’ rights in “live-stream” broadcasts, and different levels of protection may apply to live-stream broadcasts in different Member States.

 

Facts

C More Entertainment is a pay TV station that broadcasts live ice hockey matches on its website. The live-stream sits behind a paywall and users pay a per-match viewing fee. The defendant, Mr Sandberg, placed links on his own website that allowed users to circumvent the paywall and watch the hockey matches live (as broadcast) from C More’s website for free.

C More contacted Mr Sandberg and asked him to remove the links. Mr Sandberg refused. C More then put in place technical measures to prevent access to that broadcast via the links and took action in the Swedish courts against Mr Sandberg, stating that the placing of the links constituted an infringement of C More’s rights.

In 2010, a Swedish District Court found Mr Sandberg guilty of copyright infringement. He was fined and ordered to pay damages and interest to C More. The case went all the way to the Swedish Supreme Court, who asked the CJEU to decide whether Swedish national copyright law was consistent with EU Directives.

The Issues

Copyright laws across the EU have been partially harmonised through various European Directives, but differences remain.

Under the Copyright in the Information Society Directive 2001/29 (the “Directive”) Member States must give:

  1. Copyright owners an exclusive right to authorise or prohibit any “communication to the public” of their copyright works. “Communication” includes live-streaming; and
  2. Broadcasters an exclusive right to authorise or prohibit the availability of their “on demand” broadcasts.

 

Swedish copyright law gives broadcasters wider rights than those prescribed by the Directive, protecting forms of transmission other than “on-demand” broadcasts. The CJEU therefore had to consider whether Sweden was permitted to give these wider rights to broadcasters, or whether the Directive prevented Member States from doing so.

Relying on another Directive (the EU Rental and Lending Directive 2006/115), the CJEU stated that Member States should indeed be able to give broadcasters the right to authorise or prohibit any communication (not just “on-demand” communications) to the public of a broadcast transmission. The CJEU stressed however, that such protection could only be awarded provided that it did not undermine the protection of copyright. This ensures that the overarching rights granted to the copyright holder reign supreme.

Comment

Previous rulings from the CJEU (in Svensson, Bestwater and TV CatchUp) have explored what amounts to a communication “to the public” in the context of hyperlinks, embedded content and retransmissions of broadcasts. The CJEU did not consider this further in its decision in C More, as the related questions were withdrawn. That is a shame as a clear ruling from the CJEU’ that directly addresses linking to content behind a paywall would have been helpful.

The ruling highlights the fact that copyright laws across the EU are partly (not wholly) harmonised and that a principal objective of the Directive is to harmonise copyright and related rights but only as far as is necessary for the smooth functioning of the internal market.   National differences that do not adversely affect the internal market will not be open to challenge. This is an interesting issue at a time when the European Commission is driving through proposals to reform copyright laws across the EU to achieve a Digital Single Market. Readers of this blog may be interested in a Fieldfisher paper on the future of copyright in the EU with views and opinions from the industry, as well as reaction to the EU’s Digital Single Market agenda.

 

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Developments in Digital Currency: will the Government or the Bank of England step-in?

Posted on March 25th, 2015 by



Introduction

After a brief explanation of what digital currency is, this blog will summarise some of the key risks and benefits currently associated with digital currency. It is a combination of these factors that has caused the Government and possibly the Bank of England to intervene in the digital currency market with the aim of encouraging its growth and to protect users against some of the inherent dangers.

What is digital currency?

A digital currency is an internet based payment scheme that incorporates a decentralised payment system and a related currency. Digital currency exhibits properties similar to physical currencies but allows for instantaneous transactions and borderless transfer of ownership.

Perhaps the best known example of a digital currency is Bitcoin, which came to prominence in late 2013 when the price of a Bitcoin briefly soared to $1230, from around $10 only 18 months previously. Bitcoin is a peer-to-peer system that allows users to transact directly. These transactions are verified and recorded in a public ledger (known as the block chain). Entries are verified and recorded into the block chain by users (miners) who offer their computing power to verify transactions (in exchange for payment in Bitcoins). 

What are its potential benefits?

In a digital currency transaction the parties may benefit from a fast (or even instantaneous) verification and settlement of the payment system. The speed of a digital currency transaction is not affected by the geographical location of the payer or payee. The global reach of digital currency is another of its advantages; it allows parties to conduct borderless international transactions with greater simplicity, foreign exchange issues fall away. This of course means that there are no foreign-exchange cost implications and indeed the other related costs of a digital currency transaction are also normally low. With a digital currency payment there aren’t usually any account-holding fees, and transaction fees are either not applied or are comparatively low. Finally, the technology that is used by digital currencies such as Bitcoins to verify transactions has (so far) proved to have an unprecedented reliability and security.

What are the risks?

There are currently numerous risks relating to digital currency. Use of digital currency, given its lack of transparency and lack of regulation, is susceptible to fraud and digital wallets are open to hacking. To compound these issues there are currently no compensation mechanisms in place, in the event a counterparty does not meet its obligations (including in cases of fraud or bankruptcy).

Other than the criminal undertone and the lack of protection, the other most serious drawback to digital currency is their potentially highly volatile exchange rate. Rapid fluctuations in value will inevitably put businesses and consumers off transacting in digital currency.

What is the Government and the Bank of England doing?

Back in November 2014 the Government sent out a call for information on the use of digital currency: the stated aim being to make Britain a global centre of financial innovation. To that end the Government wanted to better understand digital currencies as a payment method (rather than a speculative investment), this information has now been gathered and assessed.

The Government has recently confirmed it intends to apply anti-money laundering regulation to digital currency exchanges, with the aim of supporting innovation and preventing criminal use. A full consultation is proposed in the next Parliament and it will include trying to ensure that law enforcement bodies have the correct skills, tools and legislation to be able to tackle criminal activity. The Government also wants to develop a best practice standards framework, by working with BSI (British Standards Institution). Finally, the Government is launching a new research initiative to address research opportunities and the challenges facing digital currency technology; funding in this area is increasing by £10million.

Meanwhile the Bank of England, at the end of February, announced it had begun considering the issue of introducing its own digital currency. The Bank said: “While existing private digital currencies have economic flaws which make them volatile, the distributed ledger technology that their payment systems rely on may have considerable promise. This raises the question of whether central banks should themselves make use of such technology to issue digital currencies.

What to expect next?

For most, the transition to the regular use of digital currency is not likely to be a quick one, there is currently only around £60m of Bitcoin circulating in the UK. However, the underlying technology that underpins the security of Bitcoin (along with its low transaction costs and global reach) is what has attracted the Government and the Bank of England to consider the digital currency industry further.

Given the obvious potential benefits associated with the use of digital currency, by providing the legitimacy and confidence that may currently be lacking, any bank backed digital currency (allied with the Government’s promise of regulation and legislation), could be the catalyst that accelerates the use of digital currency into the mainstream. Ultimately, it seems inevitable that digital currency will become increasingly important to businesses and consumers in the coming years.

 

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