Vietnam’s new regulation on film classification will take effect on January 1st 2017. The long expected regulation is seen as a relaxation of the government’s discretion in film censorship. It is hoped that it will encourage a greater expression of creativity and allow more diverse film entertainment in an increasingly affluent Vietnam marketplace.
The new guidelines incorporate an aged-based film rating system by introducing four categories: P (accessible to all ages); C 13 (restricted to above 13-year-old viewers); C16 (restricted to above 16-year-old viewers); and C18 (restricted to above 18-year-old viewers). The new guidelines also introduce criteria for each category. While the previous film censorship system included only two categories – P and C16, the revisions could be regarded as a move towards international film rating standards. The move sees Vietnam make significant progress in film ratings.
The development of the new guidelines involved the active participation of the creative industry. The drafting authority, for example, held workshops to solicit filmmakers’ comments on the draft, and some of those recommendations were included in the final ratings system. For example, the drafting authority took into consideration the filmmakers’ criticism of the proposal to limit the duration of sex scenes and subsequently removed such limits from the draft. It was encouraging to see that the drafting authority publicly acknowledged that they learned from the film ratings experiences of other countries such as the United States, Australia and Singapore in drafting the guidelines. The exchange of information with foreign film regulators and industry associations contributed to the development of the guidelines. These were all positive signs of the authority’s willingness to structure the regulatory framework to respond to the influence of the marketplace. The filmmaking community mostly welcomes the new classification system given that it is expected to help expand the range of genres to meet audiences’ entertainment preferences, and that will likely prevent biased censorship.
Despite the improvements, much work remains to be done to implement the new guidelines. First and foremost, filmmakers urge authorities to provide detailed descriptions of the various criteria that apply to different rating’s categories. Such clarification would ensure that the new regulation achieves its objective. Currently, the language of the regulation is vague and thus is subject to interpretation by the Film Appraisal Council. For example, the meaning of ‘violence’ in the C18 category reads as follows: ‘Images, sounds, words that project violence and create strong impact on viewers are prohibited unless such images, sounds, words fit in the context of the film, and are not used in great details.’ Without further clarification of the language, the authority’s interpretation may default to the old and highly inhibiting practice of censorship.. It is important that the implementation of the new guidelines provide the necessary clarification for filmmakers submitting new film projects for classification.
In addition to seeking clarity on the criteria for each rating’s category, filmmakers hope to receive clear instructions on how to submit for a rating certificate for their film. The current regulation makes no mention of these procedures. For example, it would be helpful if filmmakers are informed of the submission process, the time expected to receive a rating decision, and procedures for appealing a decision, if needed. We believe that the participation of parents, teachers, and the film community on the Film Appraisal Council would help reflect a more balanced view, as well as a fair and transparent process. Clear procedures will also prevent unnecessary disputes.
Overall, the Vietnamese film industry is growing and looks forward to continue working with the film regulator in order to ensure the efficient and effective implementation of the new film classification system. This is an important step in supporting the ability for Vietnamese filmmakers to develop a film industry that will entertain, educate and inform audiences both at home and more widely afield.
Phan Dang Di is an independent filmmaker who graduated from Hanoi of Theatre and Cinema. Director Di made two short features Lotus (2005) and When I am 20 (2006). When I am 20 was the first Vietnamese film selected for competition at the Venice International Film Festival in 2008. His screenplay Adrift (directed by Bui Thac Chuyen) won the FIPRESCI Prize at Venice in 2009. Bi, Don’t Be Afraid won the Busan Film Commission Award at the Busan International Film Festival in 2007. His feature Big father, small father and other stories… had its World Premiere at Berlin in 2015. Di produced Flapping in the middle of nowhere which won the Critics Award at Critic’s Week, Venice 2014.
The internet is growing and innovating at breakneck speed, disrupting many established industries and changing how we communicate, conduct commerce, consume entertainment and news, and interact with government. Perhaps unsurprisingly, entertainment is on the leading edge of this disruption given the seemingly insatiable appetite for films, television shows, books, and music—industries that depend on strong copyright protections. For instance, Sandvine reported in September 2015 that “[online] consumption in Asia-Pacific is driven by the use of Real-Time Entertainment, which accounts for 47.2% of total downstream traffic during peak period[s].”
But the explosion of online availability and consumption of entertainment has come with a price. In the same report Sandvine also noted that “on upstream, however, filesharing still represents the majority of traffic [58.57%], and [Asia-Pacific] is the only region in this report that can lay claim to that fact.” This rise in piracy is concerning to rightsholders, and legitimately so. Indeed, in a study of 1,000 torrent sites conducted by the Internet Commerce Security Lab located at Australia’s University of Ballarat, researchers found that 890 cases were confirmed as being infringing (89.0%); 16 cases were ambiguous (the researchers could not determine if they were infringing); and only 3 cases were confirmed as being non-infringing (0.3%). (As to be expected, attacks were quickly leveled at this study, but none were able to take down the actual methodology.)
Widespread theft is also a concern for innovative legitimate online distribution platforms. Spotify says piracy remains the greatest challenge it faces in Asia. And in a 2015 letter to shareholders, Netflix identified piracy as a major threat to its business. As a result, some stakeholders are urging policymakers to do more to address online theft.
Yet as digital piracy continues to proliferate, other stakeholders are nonetheless calling for a weakening of intellectual property protections in copyright law. Exceptions and limitations to copyright’s exclusive rights—like the U.S. concept of “fair use” or the Australian and New Zealand concept of “fair dealing”—allow for the use of copyrighted works without permission or compensation for various social purposes. In the U.S., the legality of a particular “fair use” is determined by applying four subjective factors on a case-by-case basis. Alternatively, under the “fair dealing” model, specific allowed uses are spelled out by statute. In theory, both fair use and fair dealing can be broad or narrow depending on statutory construction and judicial interpretation, but in practice supporters of the U.S. model feel that fair use provides more “flexibility” to appropriate from copyrighted works without permission or compensation.
Regardless of whether a country employs a fair use or fair dealing model, the key policy question remains: Where should a responsible policymaker focus her energy in reforming copyright policies for the Digital Age? Should she reduce theft by strengthening copyright protection and enforcement, or should she expand exceptions and limitations in ways that may offer some benefits but also may weaken the incentives to create new works? According to my review of the evidence and a new economic model of the U.S. fair use legal regime released today, I believe that policymakers should focus first on significantly reducing theft, and that any discussion of expanding or altering provisions related to copyright’s exceptions and limitations must be accompanied by better enforcement of copyright than currently exists.
Fair Use in the Digital Age
In an effort to help guide both reviews of copyright law abroad and the judicial consideration of fair use disputes in the US, we offer an economic model of fair use in a paper released today: Fair Use in the Digital Age. In this paper, we construct an economic model of exceptions and limitations to copyright, rooted in the purpose of copyright (the creation of new works) and informed by judicial precedent, with which we derive an “optimal” level of fair use (or fair dealing). We find, among other things, that “optimal” fair use should be stricter when: (1) the cost the original work is high; (2) piracy and other forms of leakages, which simply reduce the market potential for the original work, are large; (3) the cost of distributing secondary works is lower; and (4) the fixed cost of producing secondary works are smaller.
By analyzing fair use formally and rationally, we find that much of the advocacy for increased flexibility in copyright law is misguided. The characteristics of digital technologies that fair use supporters cite to advocate for expanded “flexibility” (e.g. lower costs of copying, distribution, and production) actually suggest that exceptions and limitations to copyright should be contracting¬—particularly in smaller markets that have high rates of copyright theft and high costs of enforcement, among other factors. Additionally, our paper suggests, at a minimum, that the thinking on expanding exceptions and limitations requires much more research.
Poor Data and Poor Research Make Poor Law
Tradeoffs are inherent in nearly any policy change, and reviews of copyright law are no exception. Empirical evidence is vital, therefore, to determine the net effect of any policy change. Yet, evidence on the effects of expanding exceptions and limitations to copyright are scant and what does exist is of poor quality. For instance, fair use advocates prominently cite two studies that purport to show significant economic gains from more generous policies on exceptions and limitations: A Counterfactual Impact Analysis of Fair Use Policy on Copyright Related Industries in Singapore; and The 2015 Intellectual Property and Economic Growth Index: Measuring the Impact of Exceptions and Limitations in Copyright on Growth, Jobs and Prosperity. My own detailed analysis of these two studies unearthed a number of fatal defects, to put it mildly, that render the studies meaningless for policy purposes, and reveal a profound lack of respect for policymakers engaged in the difficult task of considering proposed changes to copyright law. (To learn more, see my analyses of both works here and here.)
A Need for Better Research
Intellectual property laws support substantial economic activity and rouse the creative energies of humankind. Stakeholders seeking to modify them are within their rights to advocate for their favored outcomes. Emotional positions are certainly influential, but if net improvements in society’s well-being are desired the discourse on policy must eventually turn to rigorous, analytical, and credible research. Certainly, careless and stunningly unskilled empirical studies aimed at manipulating discourse about copyright laws are unhelpful, and undermine the trust between policymaker and researcher. In the absence of cutting-edge research on this important topic, both theoretical and empirical, the risk is too great for doing more harm than good. I hope our new economic model will constructively inform discourse on this important topic and encourage, if not facilitate, better research going forward.
Intellectual property laws deserve nothing less.
Dr. George S. Ford is the Chief Economist of the Phoenix Center for Advanced Legal & Economic Public Policy Studies (www.phoenix-center.org), a non-profit 501(c)(3) research organization that studies broad public-policy issues related to governance, social and economic conditions, with a particular emphasis on the law and economics of the digital age.
Every week at Australia’s 2,080 cinema screens, an army of around 10,000 workers – mainly youth – facilitate the screening of 100 or more titles – features, documentaries, concerts and even sporting events – to audiences around the country.
Those jobs, the diversity of that content and the continuing investment in upgrading cinemas would be jeopardised if the Productivity Commission’s proposed copyright reforms are adopted, according to screen industry executives.
Addressing a PC hearing in Sydney, the bodies representing Australian exhibitors, home entertainment distributors and local and international theatrical distributors warned the Commission’s recommendations would open the door to more online piracy and threaten the viability of cinemas and Australian film production, resulting in a reduction of entertainment choices for audiences and thousands of potential job losses.
The PC is taking further industry submissions following the release in April of its draft report into intellectual property arrangements. Its final report is due in August.
Michael Hawkins, Executive Director of the National Association of Cinema Operators – Australasia, which represents 1,400 cinema screens in Australia and New Zealand, noted that in the past five years, the industry has invested heavily in the transition of cinemas from celluloid to digital and is now spending considerable sums on extensive refurbishments including immersive sound systems, extreme screens and laser projection.
Hawkins warned that any weakening of copyright protection, at its most extreme, would result in a reduction in the number of the Australian films and the closure of many cinemas – potentially those in the smallest markets, regional towns. “Without strong copyright protection there is just no business model. If the product is stolen cinemas will be no longer be viable; there will be massive job losses. The heart and souls of many communities will also be lost.”
“It is ironic that during an election campaign, where all sides profess commitment to innovation, jobs and growth, parts of this report speak to the death of innovation, creativity, and tens of thousands of jobs.”
Australian Home Entertainment Distributors Association (AHEDA) CEO Simon Bush rejected the PC’s recommendation that geo-blocking should not be allowed and indeed that their circumvention should be encouraged.
Bush referred to an ABC radio interview with Commissioner Karen Chester in which she said the PC believes Australians should be able to access overseas platforms like Netflix and all the US cable networks from Australia.
“The logical conclusion of this recommendation is that content will only be accessed and made by global platforms who can acquire global rights – there will be no room for smaller projects that have a niche audience,” Bush said.
“By encouraging Australians to access overseas-based platforms for content consumption, they will be taking revenue offshore and ensuring the emasculation and by-passing of the Classifications Act, with which Australian-based platforms legally have to comply.”
If Australians increasingly access content from offshore, that would undermine the ability of the Australian TV networks and Foxtel to invest in local production.
Similarly Australian film producers rely on sales to numerous territories to fund a large part of production budgets, so any significant loss of international revenue would make it much harder to finance films.
Both Bush and Hawkins challenged the PC report’s implication that screen content is not released in Australia in a timely and affordable manner. Of the top 10 grossing films in 2015, nine opened in Australia before the US.
Bush cited research commissioned by global analysts IHS in Q3 2015 which found that Video-on-Demand and Electronic Sell-Through prices for new release and catalogue product in Australia are lower than in the US and UK.
“Piracy rates for some films surge by 300% after the release of the DVD and digital version, suggesting availability is not the issue, but availability of a quality digital copy for piracy purposes is,” he said.
“If availability and price somehow is the panacea for piracy then how do you explain that Australians had the largest per capita piracy rates in the world for Breaking Bad when it was available the day after broadcast digitally for a few dollars an episode?”
Paul Muller, Executive Chairman of the Australian Screen Association, which represents the interests of the major film studios, challenged the PC’s proposal to introduce the ‘fair use’ doctrine, which permits the copying of copyrighted material for limited purposes such as criticism, news reporting, teaching, and research, without the need for permission from or payment to the copyright holder.
Noting that only a tiny fraction of Berne Convention signatories has adopted fair use, he said, “It is hard to find another area of policy where the leadership of 158 countries counts for so little in Australian policy development.
“So it would be reasonable for those relying on copyright to earn a living to expect very solid and substantive evidence that the current fair dealing system isn’t working or that the proposed fair use system will have sizable benefits, yet there is no credible, comprehensive or convincing evidence presented for either of those arguments. Rather there are only theoretical arguments justifying the changes.”
Muller also disputed the PC’s assertion that copyright stifles innovation, citing a 2011 report by Professor Ian Hargreaves, commissioned by British Prime Minister David Cameron, which demonstrated it is the investment culture in the US that drives innovation, not fair use. “The reward for creation and innovation is the incentive to create more; undermining this will mean less creation,” Muller said.
Bush concluded, “In my view the recommendations on copyright put forward by the PC will in fact result in reduced investment, jobs and revenue and shrink the economy.
The film and TV sector supports 46,000 full-time employees and contributes $5.8 billion to the Australian economy. Copyright underpins investment in creative content and the evidence for change is at best weak and contentious.”
The Productivity Commission’s draft report on Australia’s copyright arrangements makes recommendations that would be incredibly detrimental to our national creative talent. The report is overall profoundly disappointing and a major cause for concern.
As someone who has spent my life running organisations that take risks, invest billions and innovate to provide the best of local and international content to Australian consumers, reading the Productivity Commission’s draft report into our intellectual property arrangements was profoundly dispiriting.
I cannot think of another recent report that so seriously misses the main drivers of its area of inquiry – namely innovation and the incentives to produce new work. At the same time, the report treats Australian creative content and its production with a disdain bordering on contempt, and that is surprising for any economic statement.
The commission makes recommendations which would have such a deeply detrimental impact on the ability of film and TV makers, writers, artists and journalists to tell Australian yarns, and make a living doing so, as to be worthy only of rejection.
Take the commission’s conclusions on what drives innovation. The draft report claims our intellectual property and copyright settings inhibit investment and innovation. Really? Most people who run businesses and invest money know that what really drives innovation is a clear operating framework which enables companies and entrepreneurs to manage their risk appetite and capital investment, as well as access to highly skilled people.
In the creative landscape, the bedrock of production is copyright – the Copyright Act provides the critical framework for ensuring returns from investment.
The Prime Minister recognised the drivers of innovation in a statement last year. He committed over $1 billion to ensure the right incentives to innovation were in place; to encourage risk-taking; and to promote science, maths and computing in schools. There was no mention of intellectual property in his statement, given there is already a clear protection framework in place.
So, having spent considerable amounts of time answering the wrong question, the commission then demonstrates what can only be described as a breathtaking disregard for the creativity of Australians. It dismisses concerns that its recommendations would lead to less Australian content, with this response: “most new works consumed in Australia are sourced from overseas and their creation is unlikely to be responsive to the changes in Australia’s copyright (laws).” So, that encapsulates the commission’s thinking – American and British material will suffice and Australian original work doesn’t really count for zip.
But make no mistake, if the commission’s recommendations to implement “fair use”, for instance, were implemented, there would be less Australian content on our screens, on our bookshelves (real and virtual), and in our schools and universities.”Fair use” is an American legal principle which would allow large enterprises to use copyright material for free, which, under Australian law, they currently have to pay for. PwC recently estimated that introducing “fair use” in Australia could result in a loss of GDP of more than $1 billion.
PwC’s report (provided to the commission) outlined three reasons for this collapse. First, “fair use” would strip millions away from Australian storytellers and content creators because governments, companies and large education institutions who now pay to use content, would stop paying as much or stop paying at all.
PwC examined what happened in Canada when similar changes were made in 2012. Universities and schools refused to pay for the educational content they used. This led to a 98 per cent reduction in licensing revenue, the closure of many publishers and a loss of jobs. Oxford University Press stopped producing Canadian textbooks for schools.
The Canadian Writers Union’s John Degan described the effect this way: “We are headed back to the bad old days of 40 or 50 years ago, when everything you read in Canadian schools was produced in the US or Britain.”
Second, “fair use” would permanently lift legal costs in Australia. US copyright cases are almost five times the volume of cases in the UK, whose law is comparable to ours. Good for lawyers, bad for creators and consumers.
Third, fair use would undermine the effective and fit-for-purpose licensing system that has evolved here allowing Australian teachers to share and copy almost every book, magazine, image or journal published in the world, with their students, for less than the cost of a single book each year. This fee is paid by school departments, not students.
None of this means that we shouldn’t continue to update our Copyright Act. Industry-led reforms to the Copyright Act are already well advanced in an unprecedented collaboration between rights holders, libraries and education institutions. They deliver on a promise by the Attorney-General George Brandis to review the Act in the government’s first period in office.
So let’s aim for sensible reform which balances the incentives and protections for creators with the rights of consumers to access wide ranging material on fair terms.But remember, fair does not equal free, and no one needs a manufactured revolution driven by armchair economists who want to blow up Australia’s content sector – as this disappointing report proposes.
This article was first published in the Sydney Morning Herald on May 6, 2016.
Kim Williams is chair of the Copyright Agency and Viscopy. He is a former CEO of NewsCorp Australia, FOXTEL, Fox Studios Australia, the Australian Film Commission, Southern Star Entertainment and Musica Viva Australia.
India’s digital story is unfolding day by day. Our Internet user growth rate is over 40% – as against a global growth rate of 9%. The number of mobile Internet users in India is approximately 400 million and rapidly growing, especially in smaller towns and rural India. In fact these markets will really power the growth over the next few years.
Entertainment continues to remain a key driver of this growth in Internet usage across the country. Content consumption patterns in India have evolved over the last few years, resulting in the increasing growth of multiscreen video consumption. We are in a multi-screen platform era, where all screens- tablets, phones, desktops, etc. work seamlessly together and are accessed by users at different times of the day. This is largely due to young working professionals and college students who want to consume entertainment anywhere and at anytime. These consumers especially are quality conscious rather than price sensitive and they are willing to spend on exclusive, premium and high quality video content. Online video services catering to these consumers, which initially offered largely movie catalogues, are also rapidly evolving. Today, a variety of content formats, such as linear and live TV, original programming and short format videos are on offer, which are customized to different audience segments. Live TV on OTT is one of the key drivers of the OTT space, which replicates the television experience on any Internet enabled device be it a smartphone, laptop, desktop, tablet or any other device. Live OTT streams are delivered across Internet connected devices without any delays compared to the actual broadcast. Viewers can therefore watch their favourite shows and catch up on the latest news and sports updates real time, while on the go and are no longer confined to having to be in front of a TV set.
Live TV on OTT is also a phenomenal opportunity for broadcasters to expand their reach and target eyeballs beyond their Linear TV viewing audience and engage their digital audiences better through social media etc. All in all, improving the overall user experience for viewers and building a combined audience base which, over time, helps in attracting better advertiser spends. With television being the most loved and familiar form of entertainment across the country that cuts across all social classes, linear, Live and on-demand consumption of TV will grow exponentially in the future.
However, this exponential growth needs to be supported by an evolving ecosystem. Challenges like varying levels of broadband access, low Internet speeds and affordability in terms of data tariffs continue to be hurdles for players in the OTT space. Other challenges include establishing Internet availability and performance that measures up to global benchmarks along with distribution and pricing. Market access regulations and piracy are other concerns for the OTT industry.
In order to ensure that live television is within the reach of every Indian, we partnered with one of India’s leading telecom players Idea Cellular, to offer its 3G and 4G internet pack subscribers a free monthly subscription of dittoTV with every recharge. We believe that with the surge in affordable Internet enabled smartphones, partnering with telcos to bundle ditto TV with heavy usage data packs is key to enabling subscribers access the wide array of high quality online content on dittoTV. However, since this sector is still in a nascent stage of growth in India, it is important to also work closely with the government and industry bodies to create a conducive environment which will help OTT content delivery platforms reach their full potential.
Archana Anand is currently the Business Head for dittoTV. She joined the company in July 2015 as the Head of Global Business Development for dittoTV at ZDCL. In February 2016, she took over as Business Head. In her current role, she is responsible for the Strategy and P&L for dittoTV. Archana comes with close to 20 years’ experience across Business domains. Prior to Zee, she spent 8 years with OnMobile Global, a VAS services provider where she headed their Infotainment Product Vertical. Archana’s strong people skills, along with her natural flair for all things Creative makes her a natural marketer. While at Onmobile, she was responsible for the conceptualization and launch of ‘Help me on Mobile’ – a safety application for women. She was awarded the ‘Inspiring Women Leaders’ award by Synergian in 2014. Archana has a management degree from IIM Bangalore. A keen English Theatre aficionado, Archana has acted in and directed numerous plays. She also enjoys cooking and baking.