We fought the law
March 21st, 2014
In June 2012 we began the process of challenging the NLA’s licensing regime around media monitoring, specifically concerning the fees paid by charitable and other not-for-profit clients, and also the fees and other conditions to which we were subject. In October the Tribunal stayed the element that affected our clients, regrettably. Then this week the Tribunal ruled comprehensively against us on all the other issues of concern to us.
The bulk of our remaining issues surrounded the fee we have to pay in order to scan content for our clients. We cannot believe that a body designed to achieve fairness endorsed a scheme which charges a small company like ours (with a turnover in the tens of thousands) just over £5k for a licence, while our largest competitors, with a turnover in the millions, pay £10k. Oh, and Google pay no equivalent licence for carrying out the same activities: they’re treated as non-commercial. Really. But that’s what the Tribunal did.
We argued that the benefits of being permitted to scan content are proportional to the number of clients a company has: this scheme requires us to pay many hundreds per client while our largest competitors pay less than £10 per client. But no: that’s apparently fair.
Even the NLA appeared to think that the writing was on the wall for this crude fee scheme – they presented the Tribunal not only with a fallback banded scheme which would have somewhat reduced unfairness, they even presented the Tribunal with a figure which they thought was appropriate if a per-client fee were to be used. Their figure for this was well below the upper end of the range we suggested, and it would have preserved their income while delivering fairness within the market: we would have been entirely content with it. To say we’re disappointed is an understatement.
However, one half of the NLA’s scheme remains in jeopardy, having been ruled against by the UK Supreme Court and then referred up to the European courts. In that case, the NLA’s disgraceful claim that the act of viewing freely-provided public content on the publishers’ own websites requires a licence was provisionally struck down. We are confident this ruling will be upheld in Europe, which would allow our clients to receive emails and view such public content unhindered (!).
Sooner or later, too, given that the relevant part of the back end of our operation is essentially a more specialist search engine, we believe the courts or legislation will strike down that half as well, and so allow companies who scan but do not republish copyright works to innovate freely. But until that happy day we will continue to grow and diversify what we do despite this patently unjust ruling.