© Clearance Issues for Online Video

Seminar on IP and Creative SMEs in the Digital Environment WIPO – 21 MAY 2008 Ted Shapiro (Senior Vice-President, General Counsel & Deputy MD, EMEA)

A successful film industry of course depends on a wide range factors.

One important factor relates not only to how copyright protects film but also how it regulates and permits the audio visual sector to function….

The Complexity of Rights Clearance • What is rights clearance?

– Securing rights for production and exploitation – Preventing third party claims – Consequences for failure to clear • Copyright and Related Rights (authors/performers etc) • Underlying works/Pre-Existing Content – Inclusion in new works or new uses of old works – E.g., books to films, clips on UGCs, old films on VOD • Personal: Rights of publicity, privacy and/or moral rights • Residuals (Guilds) and Remuneration (Statutory) • Music – particularly for online uses • Trademarks, Business names, Titles, Products, Locations • Orphans, Remakes, Sequels, Prequels, • Scope and nature of licenses particularly for new Internet services: territoriality, DRMs. (See also IFTA materials) • Related points: E&O insurance, co-production agreements, completions bonds, financiers, banks • International aspects – laws vary - e.g., exceptions

Focus for Today • Overview of AV © in the US and EU • Some Rights Clearance Issues for the Exploitation of Video on the Internet

– VOD – Electronic Sell-Thru – New Modes of Retransmission • DTT • • • Mobile TV IPTV Internet

• FIN

Exploitation of Rights by the Producer

• • • • • European approaches (Transfer, Cessio Legis, by contract) – Producer gets exploitation rights – Remuneration and moral rights US Work Made for Hire Doctrine (17 USC §§ 101, 201) – Collective bargaining – residuals and some “moral” rights Producer may assign copyright to a distributor or license a number of companies (e.g., by territory, by language, by category of rights) Producer responsible for securing necessary clearances Producer aims to position film in best competitive position in order to cover costs, pay everyone, to secure return on investment and to create new works.

– Film released in different formats in a sequential order (windows) to get maximum return.

– Very few films make money in the theatrical release – Bulk of return has been home video – New Modes/Piracy….are challenging existing practices!!!!

Delivery – 2 emerging models*

1. Electronic Sell-Thru (EST)(aka Digital-To-Own): • On-demand transmission of an AV work in an encoded file for download via DRM technology • consumer is authorised to retain a permanent copy (initially on hard drive or similar device and potentially for burning onto an optical disk) • unlimited use/playback.

2. Video On-demand (VOD): • On-demand content transmission for limited viewing period via DRM technology • • no permanent copy being retained by the consumer content received via streaming or self-erasing download *indicative only

VOD and EST – Some legal issues

• Electronic Sell-Thru (Digital to own) & Video On-Demand –What exclusive rights are involved?

• Making available – WCT Article 8 • EUCD Article 3.2

• In the US – Registrar of © but cf recent caselaw • Public Performance?

• Reproduction?

–New modes of exploitation – do you have the rights?

•“for all media now known or hereafter invented” •Bans on the licensing of unknown uses – German CA §31.4 – REPEALED – New §31a – transitional provisions, right of revocation (not an issue for AV), mandatory collective admin for old contracts •How do you remunerate for distribution via UGCs? Clips, •Other Issues: –Exhaustion (Art 3.3 EUCD – First Sale Doctrine in US 17 USC §109) –Exceptions/DRM (Art 6 EUCD – DMCA Section 1201 ) –Interoperability

VOD and EST – Clearing the music?

• What rights are required for music in film? – Reproduction (exception for temporary copies)??

– Communication to the Public – Public Performance???

– Making Available -- interactive services • Who is the owner of those rights? – Pre-existing/specifically created - Composers/Publishers • Rights Acquisition by Producers – Contract and/or – Statutory (work made for hire,

cessio legis

• Buyouts and local collecting societies or presumption of transfer) • Which Law Applies? What about mandatory rules? • US is a single territory (ASCAP, BMI, Harry Fox, contractual freedom) • Music licensing in the EU is undergoing a lot of change…

New Modes of Retransmission • Cable retransmission (and Satellite) – Mandatory collective exercise of rights – Role of initial broadcasters – EC Cable & Satellite Directive (Art 9/10) – US Compulsory License (17 USC §§ 111, 119 and 122) – Berne Convention Article 11bis(2) • New modes of Retransmission – IPTV – Digital Terrestrial TV – Mobile TV – Internet TV

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– Exclusive rights or mandatory collective exercise or compulsory license – Territorial scope?

– Simulcast issues

Some Tips • Continual process • Start Early • Document • Research – lots of sources online • Document • Monitor • Document • Legal advice • Risk Assessment • Consequences/Cost

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