European Commission President Calls Out YouTube, Presents Copyright Reforms in State of the Union

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New proposals around copyright and user-generated services like YouTube and Dailymotion were unveiled at the European Commission's (EC) annual State of the Union address, delivered by EC president Jean-Claude Juncker in Strasbourg today (Sep. 14), in which the governing body set out its plans and goals for the year ahead.  

User-generated services like YouTube and Dailymotion will be forced to pay more to rights holders and take tougher measures to prevent the illegal distribution of music and video content on their platforms under new plans from the EC. The proposals follow a very public campaign from the global music industry over the perceived "value gap" between services like Spotify and YouTube, which began in April.

When asked for comment, YouTube pointed to a blog post from today by its vice president for global policy Caroline Atkinson, in which she writes that "there is a better way." Music usage on the platform was not addressed.

Included on the agenda were proposals for a revised and highly anticipated copyright framework, which forms part of the EC's Digital Single Market strategy and follow extensive consultations with stakeholders across the music and tech industry. The last time that the European Union radically overhauled its copyright laws was in 2001, long before Spotify, SoundCloud and -- at the heart of the matter for many copyright stakeholders -- YouTube existed. 

"I want journalists, publishers and authors to be paid fairly for their work, whether it is made in studios or living rooms, whether it is disseminated offline or online, whether it is published via a copying machine or commercially hyperlinked on the web," declared EC president Jean-Claude Juncker during his State of the Union address in Strasbourg. 

The new rules, while falling short of totally abolishing safe harbour regulations, are significant in that they vow to "reinforce the position of rights holders to negotiate and be remunerated for the online exploitation of their content on video-sharing platforms such as YouTube or Dailymotion." 

Video sharing platforms will also be obliged to ramp up their automatic "content recognition technologies" (like YouTube's Content ID) -- a proviso that will both improve "notice-and-take-down" procedures and lead to more transparent reporting structures, theoretically enabling rights holders to better identify when their works are played and how often.

Specific details on how platforms such as YouTube will be forced to implement these measures, what form they will take, or what happens if they fail to comply, are not included in the draft proposals, but the EC is clear that the responsibility for doing so lies firmly with them.

"The proposal solely addressed the services, as they are the ones distributing the content and, most importantly, making a profit out of it," states the Commission. 

Responding to the tech industry's complaint that such regulations will have a negative impact on start-ups and new online services, the EC says that the proposals will only apply when platforms "gain a significant" mass of protected content and that its aim is to create a "level playing field" between subscription services likes Spotify and Apple Music and user-generated services that pay lower revenues to rights holders.

"Europe's creative content should not be locked-up, but it should also be highly protected, in particular to improve the remuneration possibilities for our creators," said Andrus Ansip, vice-president for the Digital Single Market, following the directive's unveiling.  

The Commission also said it was looking at tougher measures to prevent advertising on sites that hold copyright infringing content, as well as the companies that process payments for pirate platforms. 

The proposals, which will now be presented to the European Parliament and Council, were largely welcomed by the music industry, with Helen Smith, chair of IMPALA, calling the directive "a good first step to help the legal framework to catch up with market reality by clarifying the situation of platforms which provide large scale access to music and other protected works."  

She went on to say that the EC's modernized copyright framework would "help remove some of the friction in the licensing market" and "stop services providing discriminatory access to their content identification systems."  

That view was echoed by Robert Ashcroft, chief executive of U.K. collecting society PRS for Music, who welcomed the EC's attempt "to redress the current imbalance of interests between user upload platforms and rights holders." 

"The law must clearly establish that those user upload platforms that provide search and other functionality, as distinct from being mere hosts of content, require a license from rights holders," Ashcroft continued, saying that the EC proposals "provides the framework for this essential legal clarity."

Geoff Taylor, Chief Executive of British labels trade body BPI, also called the EC's plans "encouraging" saying that "the explosion of music streaming offers the prospect of a new era of sustained growth. But this potential will only be realised if the EU and UK Government fix the fault-line that lies at the very heart of the digital music market."   

However, not everyone was happy with the draft directive with some stakeholders expressing disappointment that it didn't go far enough in addressing the value gap between online music consumption and levels of remuneration paid to artists and rights holders. 

"The provisions designed to address the issues are not sufficiently robust or concise," said Pierre Mossiat, presidentof the Independent Music Publishers Forum (IMPF), representing indie music publishers worldwide. 

"Without clear regulatory guidance the interests of big business will continue to jeopardize the livelihoods of songwriters all around Europe," warned Mossiat, who said that while the draft proposals were "a step in the right direction" they still have "quite some way to go to achieve the level of compensation for the use of their work that songwriters and indie music publishers -- the core small businesses in the creative music field in Europe -- need."