ACMC/2/1: Electronic Commerce and Copyright: A Key Role for WIPO

Electronic commerce is about to explode according to many experts. In February 1999, Forrester Research predicted that from US$20 billion in 1998, e-commerce would reach more than $50 billion this year and $320 billion by 2002. By comparison, Microsoft Corporation had revenues of approximately $15 billion in 1998. Confirming this tendency, in addition to Forrester itself, Jupiter Communications, Yankee Group and International Data Corporation also predicted an increase in consumer online spending (credit card purchases and use of "electronic wallets") of more than 100% per year.

This phenomenon by and large is limited to a group of highly industrialized countries, but the Internet is fast becoming a truly global network and international payment systems now routinely allow payments to be made across national boundaries, typically using credit card accounts.

The next question is: what is electronic commerce? Or, in other words, what can consumers and businesses buy or trade over the Internet?

A significant part of electronic commerce consists of so-called catalog sales, where a computer screen replaces traditional paper catalogs, often with a broader selection, constantly updated choices and prices and, of course, world-wide access. In this form of e-commerce, the digital bits are used to sell atoms. Perhaps the best example is Amazon.com, which has successfully been selling books and compact discs over the Web.

Then there are two forms of e-commerce that do not involve atoms. Bits are used to buy or sell bits. This happens, first, when the information necessary for a transaction to take place is exchanged online. Online brokerage services, allowing users around the world to place trading orders on the major bourses are a good example.

Yet, probably the most exciting form of e-commerce is the sale of bits sold in packets representing works protected by copyright. Logically, since most literary and artistic works can be digitized or are created digitally, the Internet should be the best way to access such works (as opposed to buying packaged bits). For example, why not purchase a file containing a song, or a scientific article online, rather than having to locate a physical copy of the CD or journal? Naturally, there are cultural and practical reasons why certain types of works protected by copyright might not be successfully sold on the Internet. A novel is something we want to read on the plane, the train or perhaps in a good armchair or even in bed. There the look and feel of a bound book may be hard to replace. Yet, most purchases of copyrighted material, in particular in the business-to-business environment, could be done easier and better online.

The same could be said concerning the creation of new works. Creators throughout history have relied on preexisting material, consciously or unconsciously. It has been said in that regard that the past is prologue and, according to Blaise Pascal, all men are a continuum, a single man as it were, continually learning and adding to our predecessors' realizations. The Internet allows creators worldwide to access all works put at their disposal to create new works. This also allows creators in all countries to access preexisting works across boundaries and cultures, progressively creating a huge global library for all those with access to the network. This should accelerate economic development as access to state-of-the-art technical information and best practices from around the world become readily available. A good example is patent information: patents from several major patent offices can now be searched online and the full text of patents can be downloaded.

Why then does it seem to take such a long time for this type of e-commerce to develop? The simple answer is: copyright. Only two years ago, it was trendy to suggest that copyright and the Internet (or its multimedia cousin, the World Wide Web) went together like fire and water, and that as a result, copyright would soon be either evaporated or extinguished. In the past 12 months, the increasing bandwidth and user base of the World Wide Web as well as new compression algorithms have made it possible to download new types of works, not just plain text, ASCII or PDF files. The most talked-about phenomenon was clearly music, notably due to the MP3 phenomenon. This expanding power of the Web to deliver content online should have marked the end of copyright as we know it. Paradoxically, the reverse seems to be happening, as recently noted in The Economist (1ter). A number of "secure" initiatives, sometimes referred to as "copyright management systems," have been proposed and several systems are in advanced "beta testing" phase. Without going into all the detail on these efforts, the critical point to bear in mind is that several large publishing houses now offer high-quality content over the Web or have plans to do so soon. Music producers have also decided to harness the power of the Internet to sell music, as soon as a proper technical solution is found.

For example, readers of scientific, technical and medical literature can find thousands of high-quality journals offered online (usually in addition to the paper copy). From Academic Press' IDEAL, to Science Magazine, to Elsevier's Science Direct and Springer-Verlag's LINK and dozens of other systems could be mentioned here. Hundreds of magazine and newspaper publishers are following the same path and major newspapers in many countries are available online in full text, often on the same day as the paper publication. In the United States, examples include the New York Times, The Wall Street Journal Interactive Edition, The Washington Post, Newsweek, Business Week and many, many others. One oft-cited advantage of the online versions is that they can be word-searched and archives are often searchable as well.

The business models for delivering content protected by copyright vary. The most common models could be summarized as follows: in some cases, the material is available for free and can be searched without identifying oneself. However, most often publications will offer free registration before they allow users to search their content. This process provides content owners with valuable demographic (market) information and allows them to compile possible e-mail lists for future direct marketing efforts. In other cases, while an abstract of the first few lines will be used to illustrate the content, fees may be charged to download the full text. Finally, other content providers prefer the subscription model which can be a subscription to the electronic version only, or combined with a paper subscription (in some cases, the electronic version is offered as a "bonus" for subscribers to the paper version).

What is common among most content providers, however, is that the material thus provided online is subject to a "mouse-click contract" and/or terms and conditions limiting what the user can legally do with the material. Such restrictions typically limit the use to a single user, and allow that user only to read and possibly print a single copy. Redistribution or reuse of the material in any way is generally prohibited. While in the world of text publishing (newspapers, journals and magazines) this is by and large done on an honor basis (based on law and contract), other industries seem to prefer technical solutions, such as digital containers and encryption systems, to enforce those terms and conditions.

In this paper, we define Electronic Copyright Management Systems (ECMS) in a way that covers all of the above, namely first when the owner wishes to apply standard terms and conditions and perhaps enforce them using technological measures, but also cases where a user might need additional rights to reuse the content, for example, to make additional copies, post the material on an Intranet or Internet site, create a CD-ROM or DVD, etc.

2. Defining the Concepts

2.1 Defining Copyright Management

Before we can understand electronic copyright-management systems, we need to understand the concepts that underlie such systems, starting with "copyright management" itself. Copyright-management systems are basically databases that contain information about content (works, manifestations of works (1bis) and related products) and, in most cases, the author and other current rightholders. That information is needed to support the process of authorizing the use of those works by others. A copyright-management system thus usually involves two basic modules, one for the identification of content and one for licensing (or, rarely, for other rights transactions, such as a full assignment). In many cases, ancillary modules such as payment or accounts receivable are also considered part of the system, but the core of a copyright-management system is content and rights identification and a licensing tool.

A copyright-management system can be used by individual rightholders or by third parties who manage rights on behalf of others. A rightholder might use the system to track a repertory of works, manifestations, or products, or an organization representing a group of rightholders might use a copyright-management system to track each rightholder's rights and works. Such an organization might be a literary agent representing a number of writers, or, more commonly, a collective management organization such as an authors' society. (Most collective management organizations are members of the International Federation of Reproduction Rights Organisations (IFRRO), or of the International Confederation of Societies of Authors and Composers (CISAC).

In a collective management organization model, the mandate to authorize third parties may come directly from rightholders under a voluntary (contract-based) system, or it may follow from government regulations that impose a non-voluntary license or that create a right to remuneration that must be managed collectively.(2)

With respect to pricing, in some cases rightholders set the price for each type of use of each piece of content. In the vast majority of cases, however, prices are contained in tariffs applicable to a class of content and/or users. An annual fee, often referred to as a blanket license, is sometimes set by law and covers an entire repertory of works. Repertory licenses are useful in cases where more precise management would be either too costly or simply impossible. A good example might be music performing rights, where a radio station typically purchases an annual blanket license to broadcast music. By contrast, at Copyright Clearance Center in the United States, rightholders set the prices for various types of use.

Another approach, the transactional fee, gives the user a license to use a specific work or manifestation for a defined purpose. The user typically applies for the license when he/she needs the rights in question. For example, educational institutions in the United States that produce paper and electronic "coursepacks" (collections of material from various sources, usually considered a supplement to textbooks) generally must obtain prior authorization for each piece of content used; the use of music in advertising or, in most cases, to make a commercial recording, also requires a transactional fee that covers only that specific use. In the transactional model, collective management organizations either grant a license based on agreed terms set in advance by the rightholder, or they act as an intermediary between the rightholder and the user to establish terms.(3)

2.2 Defining Electronic Copyright Management

Applying the above concepts, we see that copyright management functions can be made easier with computers, which can act both as huge rights databases and automated licensing engines. Such computerized systems allow rightholders to automatically grant licenses to users without human intervention, which has the benefit of keeping transaction costs low and making licensing an efficient, "Internet-speed" process. That is, licenses to use a specific work can be granted automatically to individual users. For example, a corporation or an individual author or user can purchase the right to use an image, video clip, or song to republish it in a magazine article; or a publishing house might purchase the right to reuse previously published material. These systems may also be used to deliver content in cases where the user does not have access to such content in the required format. Finally, digital technology can also be used to track usage ("metering" and "monitoring"), look for unauthorized uses (programs known as "spiders" scour the Web looking for unauthorized copies of material on Web sites) or to encrypt material and thus limit further uses of the material.

For transactional licenses, an electronic copyright-management system basically acts as a licensing "engine." There are various implementations of such systems that range in technical sophistication. In the least sophisticated, a user mails, faxes, or e-mails a license request to a collective management organization that processes it manually and returns an answer to the user. In a slightly more automated environment, the organization uses an electronic works-and-rights database, but still processes the license request manually. Another step up in the ladder of automation is where an internal computer-based licensing system processes the request. With a full electronic copyright management system, the user searches available content and rights online, submits a license request electronically (usually via the World Wide Web), and receives a response from the electronic copyright-management system without any human intervention. That last option is, in my opinion, the only real electronic copyright-management system.

3. ECMS Issues and Obstacles

There are several clusters of issues that are hindering the development of ECMS solutions. They are grouped below in three main areas: legal, standards-related, technology and privacy.

3.1 Legal Issues

The principal legal issues that need to be addressed in electronic copyright-management systems are ownership of rights and works, rights to be conveyed, what the conveyance allows, and whose laws apply in case of a conflict involving more than one country. What follows is a short inventory of the most pressing issues, those critical to the success of e-commerce of copyrighted material.

3.1.1 Rights issues

3.1.1.1 Who owns the rights?

While the author usually owns the rights to a work at the time of creation, legal relationships like employment or work for hire may vest those rights in someone else. The issue is more complicated in the case of a motion picture or play, where other rightholders (e.g., producers or performers) may be involved. In addition, copyright rights are routinely transferred (e.g., from an author to a publisher, or from one publisher to another). The electronic copyright-management system needs to know who owns the right to authorize the use of a work in whole or part at a particular point in time-and then possibly also who may be entitled to a share of the royalties.

3.1.1.2 Which rights are involved?

Copyright is not a monolith. It comprises a number of different rights, and those rights have a separate existence in different parts of the world. We thus have a three-dimensional matrix, with a multitude of "rights" that, to make matters worse can, in most cases, be separated territorially.(4)

An inventory of the components of "copyright rights" is found in the Berne Convention and many national laws. There are two overarching categories: moral rights and economic rights. Within the former is the right of paternity or authorship and the right to oppose mutilation. In the latter category, the most important rights are the reproduction right, the right of communication to the public (which includes, according to Article 8 of the WIPO Copyright Treaty, the right to "make available"), and the right of adaptation. An electronic copyright-management system is concerned mainly with rights that can be licensed or traded on a routine basis, and therefore economic rights are better candidates for electronic copyright management than moral rights.

3.1.1.3 What rights are conveyed?

A digital transmission of content implies making a copy, at least at the point of reception. Although some argue that digital transmission involves the right of "distribution," a copy is not really distributed in the physical sense. In fact, whenever a protected work is accessed on a server and a user gets a copy, the right of reproduction rather than the right of distribution may be invoked. Certainly that is the position taken in the first of the Agreed Statements accompanying the WIPO Copyright Treaty (WCT).

Still, an open question remains about exceptions to this exclusive right of reproduction. As provided for in Article 9 of the Berne Convention, such exceptions, including "fair use" and "fair dealing," should have a limited scope whenever a commercial activity or any other wide-scale diffusion that interferes with the normal exploitation of the work is involved.

Another important right, namely the right of communication to the public, which certainly applies to broadcasting, also applies to certain cases of interactive, on-demand transmissions. That issue certainly arises in regard to "push" technology, where information is sent to a user without his asking. Article 8 of the WCT says that the exclusive right of communication to the public includes "the making available to the public of their works in such a way that members of the public may access these works from a place and at a time individually chosen by them." That is a separate right, one that may be owned by a rightholder who does not also own the right of reproduction. If a particular use on the Web requires an authorization for both rights, two different clearance transactions may be necessary.

3.1.2 Applicable law issues

3.1.2.1 Which country's laws take precedence?

The traditional theories of emission (the law of the country of origin of the communication applies) and of reception (the law of the country of reception of the communication applies) are both very hard to transpose literally into the digital environment. One of the reasons is the multiplicity of countries that may qualify under either theory. When a user browsing the World Wide Web clicks to obtain remote content, he/she does not know whether that content comes directly from the site-and the host country-that the user is browsing. It may come from a mirror site in a third country. In that case, should we apply the fiction that the content came from the mother site? In other cases, sites or parts thereof are cached so that the content can be downloaded from a server closer to the user. Do we need a legal fiction to ignore the actual country of origin versus the perceived country of emission? With the country of emission approach, servers could be located in so-called "copyright havens." The reception theory seems simpler, and to a certain extent it is. The laws that take precedence are those of the country where the user is located. But that location is not always evident. As a resident of country A, I can use telephone lines to connect to the Internet in country B. To the system, I am located in country B. That problem may be evidentiary, but it matters nonetheless.

After a close reading of the Berne Convention, Professor André Lucas of Nantes University recently proposed an amended version of the reception theory, which applies the law of the country where protection is required-the country for which protection is claimed (lex loci delicti). In most cases that would be the law of the country in which protection is claimed (lex loci), but not necessarily. Courts in a third country might be given jurisdiction by a contract between the litigants.

3.1.2.2 Who gets to choose the applicable law?

If the rightholder or service provider chooses the copyright-management system's environment, he/she is likely to prefer the laws of the country of emission, i.e., generally speaking the law where the server is located. If the access provider makes the choice, it could be the country of emission, the country of reception, or a third country, depending on where that provider is located. If rights were managed at the user level (using a set-top box, for instance), the country of reception (or even the country in which the boxes are sold) could provide the legal environment. From a practical standpoint, electronic copyright-management system modules may eventually be produced for a world market, granting rights more or less independently of any national law. The WIPO Copyright Treaty and other efforts by WIPO itself have greatly increased harmony of national laws, and the gaps between national laws are closing, making that last scenario less fantastic.

Yet, those gaps are not closing fast enough, and ambiguities remain. For instance, the Berne Convention, the Trade-Related Intellectual Property Rights Agreement (TRIPS), the WIPO Copyright Treaty, and the WIPO Performances and Phonograms Treaty impose limits on exceptions to common rules, but they do allow exceptions, and those exceptions vary considerably from one country to another. Depending on which law applies, an act may or may not require an authorization or may or may not be covered by a compulsory license or equitable remuneration scheme. It is still not clear what would happen if a French user were to download material from a U.S. site for educational uses in France: Would the U.S. Fair Use Guidelines apply?

In addition, copyright is still negotiated and traded country by country and right by right. If I, as an author, have transferred the right to digitize and disseminate my work electronically to a publisher in, say, Hungary, what happens if a corporation in France downloads and copies my work from a site authorized by the publisher? Does that publisher have the right to authorize use in France? How does the Hungarian publisher even know that the user corporation is in France? An electronic copyright-management system thus might include a function (e.g., a digital certificate or signature) that would check whether the user is located in a "valid" country, and that function could even include a digital-signature-based registration module that would confirm the mailing address of any user.(6)

3.1.3 Moral rights

The question also arises to know how will the so-called moral rights apply? While the business of electronic copyright clearly involves economic rights, it is impossible to ignore moral rights. These are rights of the author to oppose mutilation of a work and to claim its authorship even after a full assignment of all economic rights. Good electronic copyright-management systems should be able to handle ambiguity; they should not be limited to saying Yes and No. Already, sophisticated electronic copyright-management systems are in use that can help protect moral rights two ways. First, since the system allows a contract to be agreed upon between rightholder and user (with or without an intermediary), the parties may stipulate that alteration of the work is not allowed and/or that authorship must be recognized in a certain way. Second, rightholders can impose special conditions. For instance, with an electronic copyright-management system a photographer could insert language to restrict the use of her work to companies that she considers appropriate, specifically excluding, e.g., tobacco or alcohol-producing companies.(5)

3.2 Standards Issues: Identification and Metadata

3.2.1 Identification of protected material

Identifying what travels on digital networks is another essential part of a real-time electronic copyright-management system. The system must be able to precisely identify works, manifestations, and rightholders in order to secure authorizations from the right person, assign permissions, and then send payments to the rightholder. There are several competing standards under consideration or in use today, many of them recognized by the International Organization for Standardization (ISO). An overview of the major developments is contained in Annex 1.

3.2.2 Metadata issues

Until and unless a single global identification system can be agreed upon, electronic copyright-management systems must be able to function in a multi-code environment. And that means that information about the information-metadata-must be made available in a usable format.

While there are existing standards for bibliographic metadata that go back many decades, the situation is less clear in other sectors. In the audiovisual sector, there are databases that contain information like film credits, but currently there are no worldwide standards.

While the music and audiovisual fields have taken some steps to standardize metadata, there is no standard for data concerning rights ownership, licensing and trading. Thus, while the metadata may be used to identify a particular piece of content, it may not be sufficient or even useful for electronic-commerce transactions. If, for example, the rightholder is not the "original" rightholder indicated in the bibliographic metadata, the data could do more harm than good.

The most significant efforts to develop metadata standards are summarized in Annex 2.

3.3 Technology and Privacy Issues

Protection of copyright management information requires a synergy between law and technology, and there are several projects that are looking at that interface. Some important issues include:

3.3.1 The Protection of Electronic Copyright-Management Systems

Electronic copyright-management systems themselves need protection. They need standard identification and delivery formats and tools to work automatically. With the growing use of digital networks to access protected content, it is highly likely that rightholders will invest heavily in identifying and permanently marking digital works. Worldwide implementation of the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty should ensure that copyright management data are not deliberately altered.

3.3.2 Privacy and confidentiality issues (7)

In this section, we will deal with the privacy of individuals and the data concerning them together with the confidentiality of business data. The two issues are not identical but from an ECMS standpoint, they are closely related.

The two questions most often asked by users are:

(a) As a private individual, can I browse/read/watch/listen without giving my identity (and then receiving mail and telephone solicitations, etc.)?

(b) As a corporate user (say a pharmaceutical corporation), can I download this scientific article without the whole world knowing that I need this for my R&D efforts?

There may be legal grounds on which to base a claim for privacy or confidentiality in accessing protected content. In fact, academic authors in the United States have argued that the Constitution protects a right to read anonymously.(8) In many European countries, private data are protected and may be used only within strict guidelines.

An electronic copyright-management system does not in and by itself protect privacy, but it is one of the best tools to do so. If the rules under which the electronic copyright-management system operates are correctly designed, the system returns to rightholders aggregated information on use of his/her works. For example, the system could say that clearance was granted to use "Scientific Article X" to "11 pharmaceutical companies in the last month", or that "2,345 teenage users in this part of Chicago" downloaded a given musical work. The rightholder thus gets market data without violating anyone's confidentiality or privacy.

A related issue is how to identify individual digital copies (which presumably have been sold to a specific user), without creating a risk to privacy or confidentiality. If, indeed, individual copies are identified, using a watermark containing a transaction code for instance, a viable solution could be to number individual copies, without including data identifying the user who "ordered" the copy in question. Copy numbers could be linked, in a secure database, to the individual users. Should there be a good reason to make the link between the copy number and the user-for instance, under court order-that link could be made. The role of trusted third parties acting as aggregators of usage data might be especially important to users. An aggregator or collective management organization using an electronic copyright-management system could thus maintain the confidentiality of the link (if any) between a given copy delivered on-line and a specific user. The content owner would receive with the payment for use of his works a report on the number of uses, possibly with an indication of the type of users concerned, but no information about individual users. Without this type of confidentiality guarantee, it may be very difficult for electronic copyright commerce to prosper. In other words, properly tuned electronic copyright-management systems that aggregate data so as to protect privacy and confidentiality are probably essential ingredients of the success of electronic copyright commerce.

4. The Way Forward

4.1 A global intellectual property infrastructure for electronic commerce

While it is true that e-commerce and the technology behind it is evolving very fast, and that no solution found today is certain to survive, there are a number of known facts:

While some of the legal issues surrounding e-commerce may be solved by market forces, there is a clear need to address these questions in a forum where all countries can participate, get the latest information from the market and around the world, express their views, shape the emerging policy at the multilateral level and inform their own policy-making process at home;

Identification of material traded over the Internet is necessary. The many efforts underway to achieve this identification are testimony to this need; there is at present no observatory or forum in which these efforts can be discussed by policy makers, and the best practices encouraged, supported and developed;

Standards are required for e-commerce tools such as metadata. What are the rules of the electronic road? Emerging technical standards such as Extensible Markup Language (XML) allow content providers to code their e-commerce metadata into the files traded over the Internet; again, there is no global forum to discuss these options;

There are many efforts to create multimedia rights clearance centers in almost all parts of the world. There seems to be a need to observe those systems and allow those countries that wish to develop a support policy for such centers to have access to the latest technical, legal and other information; perhaps standard rights clearance modules could be developed to ensure that all countries can have rapid access to this technology, thus allowing their creators to license the use of their creations worldwide (license out) and license in the right to use preexisting material.

Clearly, authors, publishers and users would benefit greatly from interoperable centers: centers in each country or region that could speak to other similar centers in other countries. This would foster the creation of new works of "world quality" in more countries, but, more importantly facilitate access to works now known and used only in their country or region of origin, in particular folklore-related works. For this to happen, interoperability is required. Interoperability is Ariadne's thread in the labyrinth of electronic copyright commerce.

The creation of such facilities to license material protected by copyright over the Internet requires access to the network and to the necessary technology. Access in all parts of the world could be part of the mission of WIPONet, ensuring connectivity and access to copyright information throughout the world.

Today, large entertainment, publishing and other conglomerates have developed, or are currently developing, proprietary solutions for identification, copyright management, and delivery of digital content. While that may meet their immediate needs, it may not meet the needs of users if users have to go to each provider's site to get content belonging to that author, publisher or producer. Those solutions are only being developed for the most lucrative short-term markets and with content provided mostly by their builders. A network system of copyright information linked to rights clearance centers would supplement these commercial efforts. It would address the shortcomings, in terms of works identification, rightholder identification and metadata.

The reason why the World Wide Web is so successful is that services such as Yahoo, Lycos and Excite cut across the entire network of networks. The success of those "portals" is testimony to the existence of this need for global access points in all parts of thew world. At the very least, users may be looking for a certain degree in commonality in access to copyright information and licensing options. That said, waiting for a worldwide standard to emerge from several competing proprietary systems might be risky. Solutions that strive towards interoperability and a certain degree of harmony should be offered by key players who seek out, analyze, and where appropriate, help to develop those solutions. Commercial providers, as well as authors, publishers and policy makers seem to have a common interest in developing joint solutions and ensuring that access to the possibilities of e-commerce are open to all countries.

4.2 Intellectual property, electronic commerce and WIPO

Issues 1-4 identified in section 4.1 above are policy-level issues concerning legal and standards-related barriers to the harmonious development of truly global electronic commerce infrastructure. Addressing these issues would achieve these objectives:

To monitor developments in digital technology and global digital networks such as the Internet, from the viewpoint of copyright and related rights;

To offer a regular forum for different groups of owners, managers and users of copyright and related rights to exchange information and identify desirable forms of coordination or cooperation, such as in the creation and operation of electronic copyright management systems;

To monitor the methods of individual exercise and centralized management of copyright and related rights in the digital environment, and promote the optimal application of methods which are efficient and appropriate from the viewpoint both of owners and managers of rights, and of users and the general public;

To promote understanding of the relationship between intellectual property rights (IPRs) and multilateral instruments on other global issues;

To identify and explore new approaches to the use of the intellectual property system by new beneficiaries such as holders of indigenous knowledge and innovations.

To examine policy options for the use and management of IPRs in relation to evolving notions of territoriality.

Issues 5-7 deal with the technical requirements of such an infrastructure, that would be necessary to:

Address the needs of all WIPO Member States, and providing fast and cost effective communications for the intellectual property community worldwide, taking advantage of available public networks;

Ensure that all Member States have the necessary means (hardware, software and training) for network connectivity, allowing enhanced access to intellectual property information and supporting the modernization of their intellectual property systems; and

Facilitate access to intellectual property information by developing countries.

4.3 The Way Forward

4.3.1 Legal and standards-related issues

What is needed, first and foremost, is a forum where information can be made available to policy makers and solutions freely discussed and considered. Part of this task would be to gather information on the work being done on identifiers, metadata, and related activities, to have current information all in one place and to allow policy makers to discuss those options, take an active part in its making at the global level and enhance their own policy making efforts nationally. It would seem that WIPO could act as that forum, perhaps in conjunction with the INDECS (Interoperability of Data in E-Commerce Systems) Project or other similar projects. This very promising project was launched in November 1998 and is currently funded by the European Commission. Its aim is precisely to achieve a consensus on the key issue of metadata for electronic commerce of material protected by copyright.

4.3.2 A global copyright information and licensing network

The development of technical standards is a necessary step. Yet, technology to support the creation of national (or regional) multimedia copyright clearance centers would also behoove an organization like WIPO. For the reasons already mentioned, it would foster the creation of more and better material in all countries and fulfill one of the great new functions of these new global networks: give access to works from all parts of the world to users on the entire planet. The use of WIPONet could be a logical extension of that new network to cover all major intellectual property rights.

In this scenario, WIPO would act as a "Master Node" in a network of copyright information centers, some of them operated by government (as part of the national intellectual property office or institute), other privately owned. There may be other Master or High-level Nodes in the network. These Nodes would have responsibility for the operation of the network, its operations and integrity of the data. This "WIPONet-Copyright" could interface with similar networks. This could happen where a high-quality external rights database already exists for, e.g., a specialized media. There are currently large rights databases for film, print and music, although none of these databases is truly global at this stage.

These Master Nodes would contain rights data concerning all categories of works protected by copyright and neighboring rights and could where appropriate serve as licensing agents. Software would also be provided to create National Nodes. This could be no more than a plug-in program that could work in a secure way within standard browsers such as Internet Explorer or Netscape Navigator.

These national nodes would be responsible for gathering rights data at the national level (as is commonly done for industrial property rights), and where appropriate to make those works available for licensing to other participants in the network, thus making the work in question knows and available world-wide. The national nodes would also provide information on foreign material and, again where appropriate, offer licensing solutions. Naturally, depending on the circumstances in each country, national nodes could involve private industry and partners.

In addition to its other functions, Master Nodes, such as WIPO, could offer to host some of the data necessary for the operation of certain National Nodes, temporarily or for the longer term. It could also serve as a back up in case of loss of data.

Rightholders and users would interface with this network at the national level or where appropriate through a Master Node. Rightholders would be able to add data concerning their works and rights, while users would easily obtain information about existing works and rights and be able in many cases to obtain licenses to use such works in their own country, perhaps in translation or to create multimedia productions.

The resulting network could look like this:

5. Conclusion

What is certain in this uncertain and fast-changing environment is that quality content is there. In almost all cases, it is in digital form or can be digitized. Networks with sufficient bandwidth are being built, and many business users and individual consumers are already connected. They are ready for the content. Many copyright industries and other rightholders are coming to the view that global networks represent good business opportunities and that digital, though it may be different, is nonetheless interesting commercially. In fact, it may be the only future growth area.(9) To put it simply, digital is inevitable. Most of the ingredients for successful electronic copyright commerce are already assembled.

Yet, many legal and standards-related obstacles remain and it seems unlikely that they can successfully be tackled at the national or regional level. Multilateral solutions are highly preferable. A forum is required to address these issues, gather relevant data and discuss possible ways forward and policy options.

Practical copyright management solutions must also be found to ensure that the potential of global digital networks is available to all. WIPO's mandate and in particular its WIPONet initiative would seem to be ideal starting points to create the necessary building blocks and establish a global rights information and licensing network.

[Annex I follows]