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EP study on "Consumer Behaviour in a Digital Environment"

7 September, 2011

This article is also available in:
Deutsch: EP-Studie zum "Verbraucherverhalten im digitalen Umfeld"

The European Parliament (EP) has published a study on "Consumer Behaviour in a Digital environment" that it commissioned from London School of Economics (LSE). The study involved a limited stakeholder consultation, which included an extensive exchange of views with EDRi and also looked at existing literature and market developments. The study is part of an ongoing reflection in the EU institutions on how to better achieve an effective single market, particularly in the digital space.

The study identifies the following factors affecting the demand and supply for illegal content:
1.the price;
2.the rise of the "prosumer" (users as both producers and consumers);
3.the exchange of products and files online between consumers; and
4.large economic incentives for providing what the authors of the study refer to as"illegal content".

The conclusions of the study focus entirely on a positive agenda, seeking to address the source of problems rather than looking at ways of dealing with symptoms. For example, regarding unauthorised use of copyright-protected content, the study proposes the development of innovative pricing and payment systems as well as reforming copyright in a way that would eliminate the inefficiencies that come from the fragmentation of the single market. The authors of the research clearly prioritise positive measures to minimise the causes of the unauthorised activity, rather than negative and defensive measures that would punish consumers without addressing underlying causes.

Similarly, the report conclusions support efforts at improving awareness of consumer protection legislation, enhanced dispute resolution and removal of practical barriers to cross-border trade. The study also discusses the rise of "prosumers", concluding that this development "potentially leads to innovation, creativity and consumer empowerment. However, prosumers cannot fully develop under current legal framework. The copyright exceptions regime and cross-border licensing problems are singled out as current challenges".

While generally being a very positive and well-thought out piece of research, the main negative point in the report is the repeated conflation of "illegal content" with "illegal use of content," which, legally, practically and societally are entirely different problems.

Finally, the research team identifies the following challenges faced by copyright law with regard to illegal access to content ("illegal content" in the vocabulary of the report):

a) the exceptions to copyright still differ significantly from Member State to Member State;
b) licensing arrangements through collecting societies have not been harmonised;
c) some Member States have introduced laws allowing restrictions on internet access for connections where illegal file-sharing has been conducted (or suspected), which may lead to market distortions and raises the question of whether the right to Internet access introduced by the Framework Directive is infringed;
d) the issue of who is responsible for clearing copyright on social media such as YouTube is not clearly defined in the E-Commerce Directive because peer-to-peer services were much less prevalent when the Directive was written. (This final point is somewhat odd because the E-Commerce Directive does not cover rights clearance and YouTube is a hosting service which therefore renders the question of peer-to-peer somewhat irrelevant.)

Consumer Behaviour in a Digital Environment (2011)

Framework Directive - Directiev 2002/21/EC as amended by Directive 2009/140/EC and Regulation 544/2009

(Contribution by Daniel Dimov - intern at EDRi)



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