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The new EU Copyright Directive leaves sports rights-holders dissatisfied

A fan filming players arriving at Southampton’s St Mary's stadium before the Premier League match against Manchester United on December 1, 2018 (James Williamson - AMA/Getty Images)

  • EU Directive was designed to shift power (and revenue) to content creators, away from platforms
  • Sports bodies lobbied for legal recognition of their status as rights-holders but failed to get it
  • Unauthorised content-sharing may be under threat but sport is unlikely to earn additional revenues

The new EU Copyright Directive is one of the most controversial pieces of European legislation ever passed, pitting content creators like record companies, film studios and sports rights-holders against social media platforms and free-speech campaigners. Few democratic processes outside US elections have seen such sophisticated and expensive lobbying from both sides.

The Directive is designed to make European law on copyright, last changed in 2001, fit for purpose in the digital age. In particular, it aimed to close the so-called ‘value gap’ by changing the balance of power between content creators and platforms like YouTube and Facebook, which carry and store vast amounts of copyrighted material.

The European Parliament voted in favour of the Directive on Copyright in the Digital Single Market on March 26 and it was approved by the EU Council of Member States on April 9. Member states now have two years to bring their national laws in line with the Directive.

The final wording inevitably contained elements of compromise. It appears to have left both sides unhappy. And many experts say it will change very little for sport and direct no new revenues towards the industry.

News and networking site Twitter told SportBusiness this week that it had “concerns” about the Directive. “Twitter has been engaged in the debate on the #EUCopyrightDirective from the beginning,” the company said. “We retain our concerns about the implications of the vote for the open, creative, and conversational nature of the internet. We will continue to engage with EU member states and civil society as the implementation process evolves.”

Facebook declined to comment but is understood to believe it already has in place cutting-edge measures to help rights-holders protect their IP on the platform through tools such as Rights Manager, which allows for voluntary filtering and blocking of content by rights owners.

Google-owned video-sharing platform YouTube has been one of the most vociferous opponents of the law. Google has invested $100m (€89m) in building a content identification system for the platform that allows sports rights-holders, and other owners, to block, track or monetise their copyrighted content.

Start-up football streaming platform Mycujoo also has concerns. The company said: “The protection of content authors is key to businesses like ours but there are concerns that the Directive may inadvertently create new barriers to legitimate content creators and distributors – particularly to the type of long-tail authors we work with. Because of that, we are evaluating the impact for us and our partners and plan to educate them about the laws we are likely to see. Where we can [we will also work] with policy-makers so they understand our model as they implement the Directive.”

The Sports Rights Owners Coalition, a representative body for over 50 sports bodies, said it was “pretty disappointed” in the Directive, which was “a missed opportunity for sport”. The body said the Directive left the law unchanged in terms of helping rights-holders protect themselves against piracy.

The coalition had put forward an amendment to the legislation, Article 12a, which was pulled from the draft late in the process. It would have established for the first time ever in European law that the organiser of a sports event owned the media rights to that event.

Article 12a

One of the most vocal critics of 12a was German MEP Julia Reda, who argued that by mandating that no one but the organiser of a sports event would have the right to make available (publish, share, present), reproduce or record an event, it would become a copyright infringement to take photographs or make short films at a sports event with a phone or camera. Everything from fan vlogs to selfies with the crowd in the background would be caught by the law, she argued.

Reda’s camp won and Article 12a did not make the cut. It was replaced with a Commission Statement, which reads: “The Commission acknowledges the importance of sports events organisations and their role in financing of sport activities in the Union. In view of the societal and economic dimension of sport in the Union, the Commission will assess the challenges of sport event organisers in the digital environment, in particular issues related to the illegal online transmissions of sport broadcasts.”

John Enser, a partner in law firm Cameron McKenna Nabarro Olswang, said that the removal of the article meant there was now nothing new in the law about the ownership of rights. “There is an odd Commission Statement that was endorsed as part of the approval process. It has a similar relationship as the Political Declaration on Brexit has to the Withdrawal Agreement – i.e. it has no impact in law. I suspect that this was the Commission saying: ‘we will drop Article 12a, but we want some kind of acknowledgement of the issue’.”

Sharing culture under threat?

Until now, there has been a grey area about who is liable if someone uploads copyrighted material, for which they have obtained no rights, on to a social media platform. Platforms have generally benefited from ‘safe harbour’ provisions which say that they are neutral carriers of information and cannot be responsible, in the same way that a phone company should not be legally liable for the content of a private telephone conversation between two individuals.

The big social media platforms have strenuously resisted any attempt to define them – and therefore regulate them – as media companies. Yet they earn billions from selling advertising and data around the media content they carry, in much the same way media companies do.

Under the new Directive, the law is clear: policing copyrighted content is the responsibility of the platforms and if they fail to do it, they will be held liable. Under Article 17, platforms must first seek a licence to carry copyrighted material.

The Directive continues:

If no authorisation is granted, online content-sharing service providers shall be liable for unauthorised acts of communication to the public of copyright protected works and other subject matter, unless the service providers demonstrate that they have:

(a) made best efforts to obtain an authorisation, and

(b) made, in accordance with high industry standards of professional diligence, best efforts to ensure the unavailability of specific works and other subject matter for which the right-holders have provided the service providers with the relevant and necessary information, and in any event

(c) acted expeditiously, upon receiving a sufficiently substantiated notice by the right-holders, to remove from their websites or to disable access to the notified works and subject matters and made best efforts to prevent their future uploads in accordance with paragraph (b).

The Directive makes exceptions for short extracts of copyrighted content used in quotation, review, criticism, caricature and parody. To ensure that start-ups in social media are not penalised, the provisions only apply to companies over three years old, with annual revenues of more than €10m and services with over five million unique monthly users.

As Enser points out, under the new law, none of the following activities would be treated differently:

  • A fan vlog, posted on social media, featuring short scenes of an actual sporting event taking place
  • A fan using Twitter’s Periscope or Facebook Live to stream part or all of a live sports event to a personal account
  • A fan filming a key moment of a sports event (a penalty in football, for example) and posting it to their own personal social media page (on Facebook, Twitter, Instagram, Snapchat et cetera)
  • A fan taking a selfie with event action (e.g. players celebrating a goal) in the background and sharing via social media
  • A fan vlog featuring scenes from inside the arena/stadium but only of the crowd or other scenes not related to the actual sporting event.

“If the fan is in the stadium there is no copyright involved, just breach of the admission rules”, Enser said. “If it is a grab of a TV feed, then the broadcaster in theory has more leverage against the social media operator to get it taken down, and whether they bother to do so depends on the sport and the broadcaster. The social media operator only has to try to pre-clear if they are receiving enough of this sort of clips to realise there is a systematic issue.”

However, the concern of critics is about what is likely to happen in practice. The law does not say that platforms must employ content filters at the point of upload. But it is the only way for platforms to ensure copyrighted material for which they have not obtained a licence does not get on to the platform.

With the platforms now facing a greater degree of legal liability, the argument goes, they will naturally err on the side of caution and filter out anything that could possibly be copyrighted, keeping out lots of ‘innocent’ content too. This will hit a whole area of fan engagement, that which involves user-generated content from goal clips to mash-ups and memes.

Enser said there was a theoretical risk that the content-sharing culture could be affected but that “Google/YouTube have been playing up this risk in lobbying terms”. He argued that it was hard to see what sort of upload filter could be put in place that would stop the kind of sharing that happens already. “The obligation to try to license material will presumably be easily countered – because the rights-holders will say no – and upload filters cannot recognise, say, a clip from a Premier League game in the same way as they can easily recognise a Radiohead track through fingerprinting.”

The two faces of UGC

In the media industry, the view is that user-generated content is beneficial for sport rights-holders – within limits.

For Gareth Capon, of real-time digital content producers Grabyo, it has become an essential part of the overall content mix, especially in terms of drawing in younger sports fans. “The whole UGC area might be a net positive for the economics of sport by engaging a new generation of fans. My son got his love of football from two things: YouTube and watching the World Cup on television: a mixture of UGC on a social platform and the passion of the live experience on television. The short form drives you to the live.

“A lot of content, like mash-ups and best goals, only exist in that kind of environment. The TV proposition doesn’t give you that experience. If you take all that away, that is definitely a net negative for the sports industry. But it is only fair that the original creator of the content has a way of monetising it.”

Daniel Ayers, of digital rights consultants Seven League, argues that some UGC uploads are more innocent than others. “For reasons known best to the Facebook algorithm, my personal Facebook Watch feed has been dominated by clips and highlights from channels that specialise in 1990s Premier League highlights, or are from streamers with lots of Uefa Champions League highlights,” he says. “They clearly haven’t licensed that footage, and they are monetising it with ad breaks. That’s definitely not right, and if it needs Article 17 to force it to be dealt with then so be it. I think that’s a world away from something like Crap90sFootball on Twitter, which is not directly monetised, is regularly amusing and, in my opinion, contributes to fan culture.”

This week SportBusiness spoke to experts working at all levels of the sports media content chain, from rights-holders to fan vloggers, about the potential impact of the new Directive. This is their feedback.

The rights-holders

Mark Lichtenhein, chairman of the Sports Rights Owners Coalition, a forum of over 50 international sports bodies, whose members include the French Tennis Federation, England’s Rugby Football League and the Women’s Tennis Association.

We’re pretty disappointed. We see this is a missed opportunity for sport. We put forward an amendment, 12a, that had huge support from the European Parliament, which would have established a neighbouring right for sport for the very first time and a big result from that would have been the ability for us to act directly in the fight against piracy. At the moment, we are very dependent on our broadcasters to get pirated content removed from platforms.

This would have been a really powerful step to give rights-holders control over their own content, bearing in mind that sports events, in themselves, are not copyrightable. It would have been a great thing for sport had the commission gone along with the parliament vote. It didn’t. We have a political declaration at the end of it. But it’s not binding legally, so it doesn’t really change anything.

From our point of view, it would have been great to establish that legal certainty. I don’t think it was asking for the world. And clearly the European Parliament agreed with us that it was important to protect sports content against the undermining of its value from piracy around the world.

We remain hopeful that by having at least that recognition that it is not a closed subject. But Directives don’t get reopened every day so for the time being it’s an opportunity missed.

The value is in live; more than 90 per cent of the value of sport is in the live experience. This is the issue for sport which differentiates us from music or film. Watching highlights when you know the outcome is supplementary to the live experience. If somebody is extracting all that value in an hour and a half, it doesn’t really matter what happens after that. The value has already gone. That’s why piracy is such a big problem for sport compared to other rights-holders in the creative industries. The erosion of value over time is much more gradual in film and music than it is in sport. In sport, as soon as the live stream is finished, it’s a cliff edge.

The UGC stuff is annoying. But it’s really the organised crime around making live streams, building IPTV boxes, things like the [Saudi pirate service] beoutQ situation, that massively undermines the whole value proposition for broadcasters and rights owners.

Including 12a would have been a positive step that would have resonated around the world. Europe has been a leader in policy making in this area. I don’t know who blocked it, but it fell through the gaps at the European Commission.

The final Directive doesn’t change that much compared to where we were. We can already issue take-down notices and hope that platforms will act expeditiously. But there’s no time limit for them to react, which in sport is absolutely critical. You can’t expect an instant response, but you need something to happen within 10 or 15 minutes or the value is gone.

The digital rights consultant

Daniel Ayers, consulting partner of Seven League, which advises sports bodies on digital strategy. Clients include Uefa, the Premier League, the Bundesliga and the NBA.

If, as a platform, you have more than five million monthly unique users, are more than three years old and have more than €10m annual revenues, I don’t think it’s unreasonable for you to have to take copyright seriously.

Expectations for obligations to rights-holders have been set very low by Google, Facebook and so on, with their historic ‘beg forgiveness rather than ask permission’ approach. Actually, that is a fairly typicaI US approach. But it’s not in line with the traditional European approach, which is more led by regulation. This is a clash of those cultures, and one reason why Europe doesn’t tend to create dominant internet companies.

I think the parody and review exceptions in the Directive will mean that sharing culture is largely unaffected. And by ‘sharing culture’ I mean users taking content and turning it into something different (adding graphics/re-editing/juxtaposing with other footage and so on), which is almost always done for purposes of humour. Sharing culture that’s ‘passing off someone else’s video as my own’ – I think that will, and should, be affected.

Will sports rights-holders earn more money from this? In music, YouTube have a very neat solution for this that’s been in place for years. Rights-holders (usually record labels) can choose from the following when their audio is used in an upload: block automatically/takedown (at least for the markets where they own the rights); allow the upload to stay online but take any advertising revenue associated with the video. YouTube’s audio library makes it very clear what can be used and in which circumstances.

There would be different technical challenges in applying this to video. What if the clip is part of a longer video, or the clip is one of many in a video (e.g. scouting videos, which seem to exist for every footballer in Europe on YouTube), with the rights owned by multiple different people? How are the ad revenues split in that case? But it’s a model that would allow content to be shared and for rights-holders to be compensated.

In terms of how we would advise clients around UGC, it’s case-by-case, but in general it is a good thing if a sports club/league/broadcaster can be more interactive with their audience on social media and encouraging UGC is a part of that.

The fanzine editor and vlogger

Andy Mitten, journalist, author and Manchester United fan, produces a two-minute wrap video related to the United We Stand fanzine and podcast, which is posted to social media platforms after matches. It contains crowd scenes from inside the stadium.

The video wrap was an extension of our podcast. Our USP is that we’re at every game. Every game pre-season, all the league games and all the European matches. You’ve got millions of Man United fans who have never been to a game. We try and deliver a flavour of the match.

As a journalist, I’m fully aware of copyright. There is nothing more frustrating than when you spend weeks, or in some cases months, to create something and then someone else just rips off the whole thing. That has happened to me several times.

We would never film any match footage. We give a flavour of the matchday from outside the stadium. If it’s inside the stadium, then it’s basically filming my mates. They [the supporters] are my mates. I’m very careful not to have any match action because I realise the rights-holders have paid a lot of money for that. People aren’t ever going to watch those two minutes to see a goal. It’s just fans singing.

The biggest video we had was of the Manchester United end in Paris [against Paris Saint-Germain in the Uefa Champions League] taken an hour after the game was finished. My readers love that sort of stuff.

But I’m aware that if they say there is absolutely no filming in the stadium that’ll mean we have to change. We’d be losing something, definitely. What happens inside the stadium is often the highlight of the trip.

We’d still do it; we’d still be there. We can get atmosphere in the pubs and there’s no way they could copyright that. It’s not about what happens on the pitch. We are not bothered about getting footage of that. But if Man Utd are playing in Seville and there are 2,000 United fans and I take a 10-second video of that and tweet it, my people like that sort of stuff.

If we were blocked from doing that it would adversely affect what we do. If we have to change what we do that would be a shame, as we are only reflecting our culture.

The real-time digital content producer

Gareth Capon, chief executive at Grabyo, a cloud-based real-time video editing service whose clients include the All England Lawn Tennis Club, broadcaster Turner Sports and the English Football Association.

The big takeaway for me is that this [the new EU copyright law] will significantly reduce competition in the social media industry because the cost of entry has gone up. It’s definitely going to be harder for start-ups that want to build a social networking platform. If the responsibility is on you [as the platform owner] to make sure the content doesn’t have IP rights implications, that’s hard. Content ID technologies are hard to build and hard to manage.

The platforms do have a responsibility. If you have a platform with two billion people like Facebook or a billion-and-a-half people like YouTube, the user-generated nature of these platforms means that without rights protection technologies such as Content ID, the platforms will become a significant outlet for piracy. It’s not a secret that YouTube’s early success was built on the back of things like Premier League goals, World Cup goals and pirated music videos. That was then addressed. The platform was bought by Google, sued by Viacom for a billion dollars, there was a settlement and then they built Content ID to address the problem on an ongoing basis and create new monetisation opportunities for rights-holders.

The short-form, real-time content is really important, especially for younger demographics who are spending a lot of time on these platforms. They find a lot of content that they would not find on traditional TV. One of my son’s favourite footballers is [Borussia Dortmund’s] Marco Reus. There is no way he would know about Marco Reus without YouTube.

I see two things developing as a result of this legislation: one, the bigger platforms will have an advantage because of the cost of entry to build that type of technology; and two, the primary rights-holders – the broadcasters and publishers, the federations, leagues and clubs – will become more dominant on these platforms because they own the rights to the content and can determine what gets distributed. What this means for amateur producers, such as the guys that created the House of Highlights, remains to be seen. Hopefully, rights-holders will recognise the value of engagement and distribution and that deals will be struck to ensure the burgeoning creativity in this space will not be restricted.

If you are creating content, it costs a lot of money. And you need the opportunity to protect your rights. If you have no mechanics to do that it is problematic. If you had a scenario where, over time, all sport was available on the internet for free because there was no protection, that would have a considerably negative impact on the sports industry.

We saw this with music, where everything was effectively available for free on a pirated basis, until we had Spotify, Apple Music and Deezer emerging as an antidote. They are legal and good value for consumers; a really effective way of addressing the problem. Why would a consumer bother to trawl through BitTorrent or any other P2P network to get Ed Sheeran’s new album when for £10 a month you can get the whole music industry? It’s now more hassle to be a pirate than it is to be a consumer and the global music industry is growing again.

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