Content creators are embracing digital market opportunities – Gurry

Gurry © WIPO 2015. Photo: Emmanuel Berrod

Mr. Francis Gurry is the Director-General of the World Intellectual Property Organisation, a specialised agency of the United Nations, responsible for the development of an effective global intellectual property system. In this interview with SIMON EJEMBI, on the sidelines of the recently concluded WIPO Global Digital Content Market Conference in Geneva, he speaks about the emergence of the digital content market

Why is a global digital content market conference coming up for the first time now?

This is a space which has undergone extraordinary transformation. The whole way in which creative works are produced, distributed and consumed has undergone huge transformation and that has had a radical impact on creators and one can say on the whole value chain for the production, distribution and consumption of creative works. We have come a reasonable distance in the last 20 years; it’s only in the last 20 years that we have had the technology and this possibility available. The objective of the conference is simply to take the temperature of the global marketplace and explore what is happening. We don’t think there is another forum that considers this particular question at an international level.

Streaming and subscription models are rather recent and they have caused digital sales to rise. So, we have very cost-effective and efficient legal business models for access to digital content now. What we would like to explore is in particular the impact they have on the value chain from creator through to consumer. They are having an impact but it is not entirely transparent exactly what the impact is. This seems like an appropriate moment; there is optimism about the global marketplace and the question arises: is there anything to be done or is it just going to happen as it were through the market?

What exactly do you hope to achieve from the conference?

The aim of the conference is to be informative rather than normative. So we don’t have a particular agenda to push. Developments are happening at such a rapid space that we need to have a better understanding of what the impact is. A lot of the creators – authors, composers and performers – are complaining that they are not getting much out of streaming models. Is that true? What is the case? Where is the concentration of value? Is it entirely in the distribution platform or is the creator still getting value out of the marketing of creative works? We need to understand more about the current state of the marketplace and its impact before you can suggest that there is anything to be done. Even if there is anything to be done, there is a big question as to whether regulation is going to actually make a big difference. The marketplace is being made by the actors of the market, but we have a perspective of the traditional copyright system, which has a number of balances built into it; balances between producer, creative producer and the consumer. What is the impact on those balances of the new technology?

How important really is the global digital content market to the world?

It is extremely important. First of all, there are all the cultural and social impacts of creative works. They enrich our lives and they are also the principal way in which education and the transmission of knowledge from generation to generation takes place. And then the economic impact is extremely important. According to a recent study that was published in December last year, the number of jobs in the creative industries involved worldwide is 29.5 million. The revenue generated in the industry is $2.25tn. So, this is a major economic phenomenon as well as social and cultural.

 Copyright infringement is common in the marketplace. What are you doing about it?

We already administer the international conventions that create protection for creators. Those conventions were all drafted for the most part in the pre-digital age and digital technology and the Internet present a number of new challenges for creators and their business associates. Those new challenges include the ease of reproduction as well as the ease of distribution. So, there is additional vulnerability created as a consequence of the digital technology. Digital technology has enormous advantages – worldwide audiences, making huge repertoires of creative works available. But on the other hand, it renders those works more vulnerable to predatory practices or to piracy. I think countries all around the world are struggling with how to deal with that. Generally speaking, there are three things that most governments are concentrating on. One is a marketplace measure to have more business models that give cost-effective access to consumers. If you think back, in 1995, just before commercial activity on the Internet, you bought a CD for about $30 and it had 10 to 15 songs on it. Now on a streaming model, you can have access to millions of songs for about $10 to $15. It’s an enormous change in accessibility. So a good business model helps compliance – helps people comply with the law. There is also a task of education – getting people to understand that when they download for free, it is not victimless. It is not something that has no consequences; it does have consequences on the creators generally because they are not getting value out of what they are creating and what they are creating costs time and financial resources, as well as intellectual resources. So, there is a general interest which is worldwide because developing countries have extraordinarily rich creators. Creation is not the problem; there are many fine performers and creators in developing countries. So, it is not a question that divides the developed world from the developing world. There is a community of interest in the subject matter.

Creators already had complaints about distributors denying them their due in the traditional marketplace.  Don’t you think the emergence of the digital market and new challenges muddy the waters for everyone?

I think it presents more challenges because of the ease of piracy, the ease of (making) illegal copies, but as a result of the enlargement of the audience, basically, price is coming down. So, we’ve gone from a model of high cost-small audience to a model of low cost-large audience. The economics change with the Internet also. It is true that there is a vulnerability created by all these, but I think that when people are confronted with the situation and they realise that by not paying for music or films, they are really hurting the economic sustainability of creators and the creative industry. Why would you invest in cultural production if you are not going to get any return for it? So, it is very important to educate people that it is not without consequences to copy. Actually, the impact of copying is that performers find it harder to have a viable economic existence and if they find it harder to have a viable economic existence, then less people will choose that career path.

With the changes in the marketplace, would the conventions in place such as the World Trade Organisation’s Agreement on Trade-Related Aspects of Intellectual Property Rights of 1995 have to be replaced?

Actually, our own conventions are now more advanced than TRIPS because TRIPS was concluded 21 years ago. Since that time, this organisation concluded two treaties in 1996 concerning the digital environment, and another treaty in 2013 – the Beijing Treaty – concerning actors or audio-visual performances. So, our own regulatory framework is now more modern than TRIPS, but whether it needs to be changed is an open question. Most people are focusing on the best way to ensure compliance through accessible, cost-effective business models; educating people to understand that there is value in intangibles and in intellectual assets and then maybe some legislative measures may be needed, but I don’t think that the legislation is the first solution or response.

There seems to be a scramble in the digital space now. Do you think creators and distributors in the traditional marketplace underestimated the potential of digital marketplace?

I think they did at the beginning, but that was 20 years ago. Since then, they have become well aware of the impact and the profound nature of the impact (of the digital content market). So, I think there is more reason for optimism now. Twenty years ago, content owners resisted the digital world because they were frightened of the vulnerabilities they created. Now, there are over 40 million songs available online. So, content owners are putting out their content on the Internet. They’ve got no choice; that is the environment. Many young people have never bought music except either through downloading or streaming. They don’t buy CDs.

What will the digital content market look like in the future?

People are more optimistic now that there are good business models but still many claim that there is a value gap. So, compared to the sales in the analogue or physical world, for digital sales, there is a gap in transition. It is by no means a completed story; it is an evolving story.

What is the level of work WIPO is doing in Nigeria and other African countries and what has the story been like for Africa?

Good. We have many specific programmes in Africa. We have programmes for the whole continent with the African Union; but we also have programmes for different sub-regions like West Africa and we cooperate with regional commissions in this regard and we also have programmes with individual countries. So, we have many capacity building activities in Africa and with African countries.

Statistics from WIPO show that applications for patents in most African countries are in single digits annually in contrast to countries on some other continents. What do you think is responsible for this?

I think it is a question of technological capacity. It is not the same in the areas of trademarks, designs or creative works. Patents are really the produce of an innovation ecosystem, which requires a lot of investments. You need to invest in a whole range of things from education to university-industry relations to research and development to having an appropriate level of business sophistication in the environment for venture capital for other capital markets and so on. So, acquiring innovation capacity is a long-term process. No one can do it overnight. But I think that as we see growth rates in Africa stabilising, we will also see more investment in research and development and knowledge infrastructure.