Wednesday, 28 March 2012

World's largest mobile payments scheme formed

Mobile phone operator Vodafone and US payments giant Visa have announced the two companies will form a partnership to create the world's largest mobile payments network. Visa and Vodafone - the world's largest mobile phone operator - will soon start to develop a Vodafone-branded scheme that will be accessible to Vodafone's 398 million customers in 29 countries across five continents. 

The scheme will be facilitated by Visa's payments network, brand and product suite. The payments network will initially be launched in Germany, the Netherlands, Spain and Turkey in May, with all the other countries within Visa's portfolio to follow within a few months.

Arnaud de La Chapelle, of Oberthur Technology, called the partnership "a powerful tool" and he expects other "financial institutions and mobile network operators to move quickly into the growing market for mobile payments". Pedro Sousa, of Visa Europe, said: "Mobile operators can make money through customer loyalty, data usage and prepay cards." 
  
Michiel Willems © 2012, CP Publishing Ltd. London, UK. Picture: www.business.myjoyonline.com
 

Monday, 26 March 2012

Interview with Maxime Verhagen: Deputy Prime Minister of the Netherlands

Maxime Verhagen
The Netherlands passed a law in 2011 that prevents internet service providers from charging more for certain types of content, effectively making 'network neutrality' the norm. The Netherlands is the first country in Europe to enact such legislation, and follows the lead of Chile, which enshrined the principle into law in 2010.   

Michiel Willems spoke to Maxime Verhagen, the Dutch Deputy Prime Minister and Minister for Economic Affairs, Innovation and Agriculture, who introduced the new legislation, to find out how network neutrality will work in practice in the country.

Why is network neutrality such an important issue for the Dutch Government?
In our coalition agreement, we have stated that the open character of the internet needs to be safeguarded. Because we share the ideal of preserving the open character of the internet, enabling end users to access and distribute information, applications and services of their choice is essential.

The principle of openness of the internet has been a key driver of the growth of the internet to date, and has facilitated an open environment conducive to the spectacular levels of innovation seen in online applications, content and service networks. In this respect, the internet is seen as a communication tool which is the basis for many innovations within our economy and society.

Why is this law so important for Dutch internet consumers and the Dutch telecommunications market? What is really changing?
The Dutch Government and a majority in the Dutch Parliament - the Tweede Kamer - believe that the open character of the internet and innovation is threatened by the policy of the majority of mobile operators in the Netherlands to allow competing services, such as VOIP and messaging services like Skype and WhatsApp only in the most expensive mobile subscriptions, and block them in the other subscriptions.

Clearly, the reason for this is to reduce their loss of voice and SMS income due to the extensive use of these innovative competing services. This way, an unwanted barrier is introduced for independent service providers who would like to enter the market and are dependent on mobile operators to reach their clients. With this law on network neutrality, we want to safeguard the ability for independent service providers to enter the market without experiencing unreasonable entry barriers. But, of course, the providers must be able to base their subscription costs on the amount of data or the speed of the connection. But since we think openness is key to further growth, we do not want a block on certain services or higher prices for the use of innovative services like Skype.

Could this law be a model for other Member States or the European Union as a whole? Will the Dutch Government push for regulation at EU-level?
The current EU telecommunications standards leave the possibility for a law on network neutrality. It is up to the European Commission as well as other European countries to make their own judgement on this issue. The European guidelines are of great value - for instance, the new European transparency rules on traffic management policies. But since we think the openness of the system is key to future growth, we are going one step further. I see the same discussion taking place in other European countries now as well. Of course, we are staying in close touch with the European Commission as well as with Commissioner Kroes.

Are operators transparent (enough) in the network management policies they apply? Will transparency requirements be imposed?
Yes. That is a key element. Regarding transparency, there is a lot of room for improvement. As a part of the implementation of the New Regulatory Framework, there will therefore also be an obligation for operators to be transparent on their internet traffic policy, e.g in the case of congestion. Consumers want to know how the traffic is managed and what exactly is taking place. I think these transparency guidelines together with our new plans are of great benefit for the consumer.

the Netherlands
The Googles and Facebooks of this world openly state that telecommunications operators will have to make all the required investments while most of the internet giants will get the largest chunk of the pie. How are the operators going to recover these costs under the new regime? Will net neutrality possibly halt investment?
Operators will indeed have to invest in their networks to keep up with the exploding bandwidth demand. So it is important that operators are able to earn enough money to carry out these investments - there is no doubt about that. The new law also leaves enough room for this. At the same time, some operators will have to find other business models than the ones they apply now. Instead of differentiating subscriptions for consumers by (not) blocking certain services, they need to differentiate on other parameters, like for example, data usage or speed. That will still be allowed and the providers are still in the position to compete on parameters like these two. Other important parameters are high quality service and services like protection against spam, viruses and trojans.

In relation to the previous question, do you expect shifts in telecommunications/ bandwidth pricing?
The future will show if prices of internet subscriptions will rise. It is not impossible that this will be the case. The price that a consumer ultimately pays depends on his total communications behaviour. If, for example, a consumer uses his internet subscription a lot to do VOIP, he possibly can have a cheaper voice subscription. Also relevant here is that I expect a change from flat fee internet subscriptions to subscriptions where your bill depends on the amount of data you use - something we are now seeing in Canada, for example, with usage-based billing.

So, for some users this may mean that they will pay less than they do now, while others may need to pay more. But I think it is fair that what you pay depends on what you use. So the offerings the operators will set in the market and the communications behaviour of an individual will ultimately determine what an individual has to pay. It is difficult to do exact predictions about this. On the other hand, we will give out new extra frequencies next year and we expect new competitors to enter the mobile market in the Netherlands. This may lead to increased competition and, as a result, moderate prices.

Michiel Willems © 2011-2012 ECLP, CP Publishing Ltd. London, UK. Pictures: www.rijksoverheid.nl (top), 3.bp.blogspot.com (middle), mapzones.com (above).  

Thursday, 22 March 2012

Near field communication: the way forward? - An interview with captains of industry

As the use of near field communication technology – a set of standards for smartphones and similar devices to establish radio communication with each other by touching or bringing then into close proximity - is on the rise around the world, near field communication (NFC) services can be seen more often than ever in daily life. Contactless payment systems are the most obvious examples, and many initiatives are being developed, such as NFC ticketing – using your cell phone to buy and store a ticket -  has, so far, not taken off yet. 

Although Transport for London announced last year it wishes to develop a ‘mobile Oyster card’, Germany, Austria and Latvia have run NFC ticketing system trials for public transport and Indian cinemas NFC based payments have bee implemented for buying box office tickets, NFC ticketing has not taken off on a mass scale yet. 

Michiel Willems speaks to five key players in the European industry. David Snow, Strategic Market & Competitor Intelligence Analyst at Juniper Research, Christoph Koessler, Product Manager at Austria Telekom, Steve Bryant, Head of Product at Orange UK, Simon Wingrove, Head of Ticketing at Everything Everywhere and Dave Busby, Consultant Transport Ticketing and Passenger Information Systems at Transport for Greater Manchester (TfGM) discuss the issues surrounding NFC ticketing and analyse how this concept could be turned into a success.

What’s holding the widespread adoption of NFC ticketing back?
Some say the technology, others a compelling business case for the service”, said Snow. While Koessler thinks it is the “past and current availability of NFC phones”. Bryant adds “handset penetration” to that and Wingrove explains it is because of “device penetration, reader infrastructure, and customer awareness - although 2012 will see significant advances made in these areas. Also the fragmented use of niche, interim, mobile  solutions such as barcodes and screen-based visual ticketing will hamper progress and confuse the customer.” 
“A lack of handsets, the lack of a business model and some inconsistency of standards, current solutions require to be specific per phone, as well as the fact that outside of Transport for London (TfL) the commercial application of smart ticketing is still in its infancy, add to this the customers view, this requires a vanguard project to act as catalyst to pull the market”, said Busby. “The main driver will come from the banking industry and this links in with transport through the EMV transport model.”
  
What’s the most important factor to allow the eco-system to work together to make NFC ticketing a success?
“In the short term, a single, common, customer experience”, said Wingrove. “In the long run that would be ticket interoperability. In addition, the [UK] Government needs to create the conditions to promote adoption of NFC ticketing so that transport operators are not penalised for investing in tech infrastructure with a mid-term payback profile.” Koessler falls in with Wingrove, adding that “for the customer it must be easy to participate in an NFC ticketing environment, such as handset purchase, subscribing to the service, installation of the NFC ticketing applet, ticket purchase and carrying out the mobile payment”. Snow says “integrating mobile payment services and players is vital”, while Bryant believes that NFC ticketing can only be a success if there is a “standardisation across mobile operators and transport companies to support contactless readers”. Busby agrees with that: “the answer to this question, enough handsets working with a common implementation and a proven business model.”
  
What’s the real business case for NFC Ticketing?
“This is an interesting one, benefits are ease of access, reduction in barriers”, said Busby. “Financially these are unknown, the potential is that if the phone is there to use a ticketing application cost be cost effective to apply, but it is still unknown what any overhead charges may apply from the phone operator.”
Koessler is convinced this is “the mobile sales channel, together with over-the-air ticker reception that allows for massive cost savings compared to classic sales channels”. Bryant thinks sees opportunities since NFC ticketing should mean “a reduction in costs for the transport operator and the ability to up sale additional services such as accommodation and restaurants. There could also be an opportunity for advertising on the wallet to promote services.” Snow thinks this question is difficult to answer since “this hinges on more than just facilitating ticketing, also on other mobile commerce services”.

 “The business justification for NFC needs to be determined on a case by case basis”, explains Wingrove. “There isn’t a one size fits all case that is appropriate across different types of deployment. What we can say though is that NFC has the ability, with the correct application, to deliver cost efficiencies, such as a reduction in ticket production and distribution costs, cash handling and so on, and revenue generation, such as through utilising the direct channel access to customer to deliver relevant and compelling CRM, promo and engagement.”
  
What time frame are we looking at for widespread adoption – is 2012 too soon?
“Depends on what is meant by widespread, but 2012 is too soon for widespread NFC-enabled phones”, Snow comments. Wingrove is more optimistic: “2012 will certainly be the year that contactless technology, with NFC forming an important component, becomes more prominent in the public consciousness – this will be driven by significant device marketing and network-based marketing as well as unique events such as the Olympics where contactless is expected to take a prominent position.” Bryant thinks 2012 will merely “be more of an opportunity for first movers and the development of the eco system, 2013 will be more important for wider adoption due to handset penetration”. Koessler comments that it all “depends on NFC handset penetration and the simple inter-working with current chipcards or mobile ticketing solutions. It will differ from market to market.” Busby wonders: “Widespread adoption in the UK? 2013, plus schemes need to deliver first with their contracted deliverables before NFC can be adopted.” 
 
How do the alternatives compare to NFC?
“Currently very well, barcodes are filling the gap”, said Snow. Koesler, however, is not so convinced: “Mobile alternatives, such as apps and barcodes, are not tamper-proof enough and plain chipcards do not allow for mobile ticket purchase/reception.” Steve Bryant also thinks “alternatives such as bar codes and electronic tickets will not operate in a multi-service environment and not support the migration of services from the physical wallet. EMV will have the limitation of not supporting travel cards such as monthly/weekly passes or season tickets in card emulation mode.”
Wingrove is also not convinced barcodes can compete: “Barcodes are not suitable for high throughput gated environments such as the tube as read times are too slow and unreliable and the customer needs to open an app on their device prior to each use.” He believes “there are multiple alternatives, each of which can perform a part or a single element of the NFC functional capability but none can deliver the complete suite”, Wingrove explains. “For example, NFC payment services have already been launched in the UK using fully certified, banking grade, secure processes and architecture. There have been no barcode services adopted by the major card issuers on account that it is a less secure technology. Each alternative technology may have a niche application but NFC is the only technology capable of providing a service that fits the key criteria across a range of services and providers.
                                                                                        
Busby also refers to barcodes: “Alternatives, in the UK could be considered as current ITSO smartcards, disposable smartcards, bluetooth/barcodes and contactless EMV. All can co-reside, NFC will just be another media to use. Of these contactless options, EMV is an easy one because just about everyone with a contactless bankcard will be able to use this facility.”

Many thanks for your time.
The world in 2015?

Michiel Willems © 2012 CP Publishing Ltd. London, UK. Pictures: infordata.pro

Monday, 19 March 2012

Lady Gaga leads the way

Lady Gaga has become the first Twitter user ever to have more than 20 million followers. On 17 March, the unconventional US singer reached the social media milestone when the 20th million follower joined her online community at @LadyGaga. 

The eccentric performer, famous for her extravagant outfits and extraordinary hats, is leading a group of celebrities who have discovered the power of social media. With more followers than the populations of Holland, Libya or Australia, celebrities have started to realise the commercial opportunities, and advertisers also seem more than willing to cash in; the sky is the limit! 

The concept of marketing via social media accounts, however, is not entirely new. The UK Office of Fair Trading (OFT) announced at the end of 2010 that it would start cracking down on Twitter users who endorse products and brands without clarifying whether they have been paid for their online remarks. The OFT said in a statement on 13 December 2010: 'Online advertising and marketing practices that do not disclose they include paid-for promotions are deceptive under fair trading laws. This includes comments on blogs such as Twitter.' The announcement followed a July 2010 OFT investigation into whether the public relations firm Handpicked Media had paid bloggers to write exclusively about the firm's clients. Under the OFT's rules, paid blogs can be regarded as an unfair commercial practice. After the Handpicked Media case, the OFT said that brands need to make clear when promotions have been paid for, otherwise there is a real risk of enforcement action by the regulator. 

Since then, the UK advertising regulator, the Advertising Standards Authority (ASA), has adopted the US Federal Trade Commission’s ‘social media regime’. In the US, the FTC demands that paid posts and tweets contain the words 'ad(vertisement)' or 'spon(sored)'. However, it was not until this month that commercial Tweets have really been put to the test. 

‘You are not you when you’re hungry.’

Rio Ferdinand
On 7 March, the ASA ruled that a campaign by Snickers - paying glamour model Katie Price and footballer Rio Ferdinand to tweet about the chocolate bar – did not break UK advertising rules. Mars, the parent company of Snickers, had paid the celebrities to post five messages each on Twitter. On the face of it, the first four ‘tweets’ were innocent messages about the stars’ daily lives. The final tweet contained a picture of the celebrities each holding a Snickers bar and the byline ‘You are not you when you’re hungry’, accompanied by the #spon suffix. 

The ASA ruled that all five tweets should be considered to be part of an ‘orchestrated’ advertising campaign and all tweets should have been considered as sponsored material, but this only became clear after the last tweet was posted. Nevertheless, the ASA said that the final tweet was clearly marked as ‘sponsored’ and that it was not likely to cause confusion among consumers. It was the first ruling by the ad watchdog involving marketing on Twitter.  

With the ASA decision that no further action is needed and tweets such as these are legitimate ads, the door is fully open for online marketing on Twitter and other social networking websites. Advertisers have embraced ASA’s ruling: it paves the way for many more paid-for tweets. Although all eyes are on Twitter now (will they step in to get a share of the pie?), Lady Gaga can count her blessings. As long as you have a huge following, tweeting has never been so lucrative.

Michiel Willems © 2012 CP Publishing Ltd. London, UK. Pictures: Guardian.co.uk.

Friday, 16 March 2012

Interview: Mark Beresford on ‘Project Oscar’

Vodafone, O2 and Everything Everywhere (owner of T-Mobile and Orange) recently submitted an application to the European Commission to form a joint venture, named ‘Project Oscar’, that would create an European mobile payments system that would allow customers to store debit and credit details onto their mobile phones and pay for goods, services and transport via their phone, using near field communication technology. Although there have been some regional initiatives in a few European Member States, a Europe-wide mobile payments system would be the first of its kind. Michiel Willems spoke to Mark Beresford, Director of consultancy firm Edgar Dunn & Co in London, about 'Project Oscar'. 

What do you think of Vodafone, O2 and Everything Everywhere’s proposed joint venture, named ‘Project Oscar’?
Project Oscar only aims to address one side of the equation. The NFC acceptance ecosystem has not yet reached a critical mass whereby the consumer devices and the merchant acceptance devices are at a reasonable equilibrium and are available everywhere. Critical mass in both sides of the consumer and merchant sides of the equation is vital. 

Is it a logical step forward for the industry?
It is a logical step forward but only a for the e-wallet consumer side of the equation. The mobile network operators wish to add value to the consumer proposition beyond the provision of voice and data services. Payment is one area where the consumer proposition can be enhanced. However, it does not directly address the infrastructure investment challenge that retailers will have in the acceptance of NFC mobile wallet payments. There are a number of mobile wallet initiatives announced or about to be announced by Google, Apple, Visa and MasterCard. A small consumer segment is only just starting to get used to using NFC contactless payment cards. The step from a NFC card to a NFC mobile wallet is a logical step but has yet to be proven on a mass consumer scale.

Will this project bring the mobile wallet to Europe?
At the end of the day it is the retailers who will accept mobile wallet payments. Without an acceptance ecosystem these mobile wallets will be useless to consumers. There are a number of strategic initiatives, new mobile payment schemes and joint ventures, amongst operators, banks and payment providers. These tend to be market specific rather than a regional or even European specific at this stage.  Whether Project Oscar has the ability to be a mobile wallet for Europe remains to be seen.

Which regulatory challenges are there?
As demonstrated by other full harmonisation directives in Europe, there has been a poor track record in creating a consistent and standardised platform across a payments industry that is already fragmented. The immediate regulatory challenge will be whether any of these new schemes that aim to be collaborative are in fact anti-competitive or seen to be fixing prices for consumers and/or merchants. This is an area where the European regulators are well practiced in tackling.   

Which issues do you foresee for this new mobile wallet?
There are three pieces of legislation that are likely to help facilitate the adoption of a new mobile wallet scheme. The Data Protection Directive - introduced in 1995 in response to the growing need for single market legislation to promote the safe collection and transmission of personal data between Member States - predates many of the mobile and internet developments in the handling of consumer data. The Directive on Privacy and Electronic Communications,  implemented in 2002, is largely concerned with the protection of privacy and personal data within the electronic communications sector. The DPEC is most relevant and will be a critical consideration in any new mobile wallet initiative. The Consumer Rights Directive, introduced in 2011, is likely to improve the cross border potential of contracts negotiated between retailers and consumers. For consumers to sign up to any new scheme there must be a value or real benefit. Equally, for the retailer’s value proposition must be credible and provide commercial benefits and return of investment. It is these two aspects of launching and marketing any new payment scheme will be the true battleground.  Building upon existing value propositions, brands and infrastructures will be key to a successful deployment. 
 
Your phone as a wallet
It is said the joint venture would not just focus on mobile wallet services and NFC, but also on mobile marketing, advertising and other types of online payments. Which challenges and opportunities do you foresee here?
Consumer susceptibility to new payment methods and the acceptance of consumer marketing and advertising in the UK is very different to what is seen in the US. It further becomes more complicated across different European markets. Any new mobile wallet must be able to adopt local cultural propensity to accept and use new technologies. Europe is not a single segment of 360 million harmonised consumers. There are considerable differences within any single state, across demographic and across the EU.  Certain retailer’s in certain use cases, such as high frequency, low value payments, are slowly coming round to the advantages of NFC payments without a PIN. In store Wifi is more likely to be deployed by the larger retailers, where higher value transactions will be combined with product information, marketing communications and a deeper enriched engagement with consumers. Within the next three to five years, in-store Wifi is expected to show greater benefits for both consumers and retailers than accepting a NFC mobile wallet.

Which other sectors will follow Project Oscar with great interest?
Other than the retail sector, one sector that may prove to be an early adopter of NFC mobile wallets will be urban transit systems. In London, for example, Oyster is a closed loop NFC system that could adopt an open loop NFC mobile wallet model co-branded Visa or MasterCard. The transit operators around the world wish to reduce the cost of ticketing and cash handling. By placing the onus on third party payment providers the transit operators are able to accept open loop NFC mobile wallets (or NFC cards) at the barrier, thus initiating the payment at the start of the journey.  This is likely to reach critical mass in an urban transit system where speed of the payment transaction is vital.  

Many thanks for your time.
Michiel Willems © 2011-2012 CP Publishing Ltd. London, UK. Pictures: Risk and Regulation (top), siliconangle (above).

Thursday, 15 March 2012

Interview with the Chairman of the European Payments Council

Michiel Willems spoke to Gerard Hartsink, Chairman of the European Payments Council (the coordination and decision-making body of the European banking industry), about the present and the future of the payments market in Europe, banking regulation and harmonisation. 

How has the European Payments Council changed since you became Chairman?
The EPC started its work in 2002 as a project organisation of banks out of the EU's then 12 Member States to give a response to the request of the regulators to create the Single Euro Payments Area (SEPA). In 2004, the European Payments Council (EPC) approved its Roadmap 2004-2010 and strengthened its processes and governance. Over time, the number of EU Member States and Euro countries increased - which required an adaptation of EPC governance, about 4,000 banks in the 32 SEPA countries started to deliver Euro payment services based on our rulebooks, affecting more than 360 million people.

And what about card payments?
In the card area, we have made a lot of progress. To make the card processes more efficient and secure, the EPC and other stakeholders created the Book of Requirements with requirements for standards, security and certification.
During my chairmanship, I hope that we will be able to deliver all the relevant rules and standards for electronic payments and mobiel payments. I hope we are able to deliver that in the next five years everyone can pay for goods and services via the internet or with their mobile anywhere in Europe.

Gerard Hartsink
Do you think the EPC is transparent and accountable enough?
The EPC's organisational structure and deliverables are fully transparent to the European payments industry. Stakeholders representing the demand side of the payments market are active in the EPC's Customer Stakeholders Forum and the EPC Cards Stakeholders Group. The EPC also provides detailed and easily accessible communication material explaining the SEPA objectives and the EPC deliverables. 

How independent is your organisation?
Self-regulatory efforts by the European banking industry cooperating in the EPC are exclusively aimed at defining the business rules and standards governing SEPA schemes and frameworks, and to engage the banking industry in the process of implementing these schemes and standards. As a result of self-regulation by banks only, payment service providers represent almost 100% of European payment volumes today. We also took the necessary steps to alert all banks in the Euro area of their obligation to be reachable for cross-border direct debits. These figures demonstrate that self-regulation produced precisely and successfully the tangible results requested by the political drivers of the SEPA initiative.
  
Do you believe in self-regulation by banks?
Self-regulation by banks is neither intended nor designed to impose migration to SEPA payment instruments on the demand side. The EPC is responsible for the development of such schemes and frameworks but not for the overall management of the this process. The national SEPA committees in the 17 euro countries have the responsibility for implementation.The process of developing payment schemes should continue to rely on the proven model of self-regulation by the banking industry. 

What do you think will be the leading payment method in the future? Mobile payments, voice identification, payments with ID cards to name a few...
The evolution of payment methods has shown structural differences in different countries if one analyses the statistics included in the European Central Bank's 'Blue Book'. The buyers of goods and services decide which instruments they use - equally, merchants choose which instruments they prefer and accept. Mobile technology has a lot of potential as an authentication tool for initiating payments. Options using voice identification are technically possible but I do not see that merchants, public transport companies or banks are prepared to invest in these options for initiating a payment. 

Hartsink
Do you believe in the value and growing importance of virtual currencies and digital money?
Virtual currencies and electronic money are not on our agenda. We acknowledge that they are a reality today for some specific and closed environments. However, virtual currency solutions are complex and expensive to manage. The traditional functions associated with classic currencies do not apply to e-currencies - such as the storage function, for example. Consumers are not easily able to use that money for other purposes outside the closed network of participants. 

Do you think fraud and cybercrime are serious threats?How should they be tackled?
Banks have the experience that certain people bribe the systems created for paying for goods and services. Central banks monitor the security of payment systems and take action when required. We are very aware of these issues, and have created several policies to prevent fraud and cybercrime. We do not publish all our security policies. But we agreed in 2006 to implement, before the end of 2010, the PIN and Chip standards on cards, and ATM terminals to prevent skimming fraud.

What do you think about other currency and banking harmonisation systems, like the proposal for a 'SEPA-type' framework in Southern Africa?
We are aware that our rulebooks, guidelines and fFrameworks are used as a benchmark in other jurisdictions in the world. When requested, we make our documentation available. For example, our ideas were used for creating the International Payments Framework that is focused on non-urgent cross-border credit transfer payments in any currency.

Thank you for your time. 
 
Michiel Willems © 2011-2012 CP Publishing Ltd. London, UK. Pictures: European Payments Council

Tuesday, 13 March 2012

Radio 1 reports

Some of my recent radio broadcasts for Radio 1 in the Netherlands
 - in Dutch -

London counts down to the Olympic Games  - click HERE
Prince Philip: 60 years of outrageous quotes  - click HERE
Dutch Prime Minister visits Downing Street  - click HERE
European premiere of the film The Iron Lady - click HERE



Monday, 12 March 2012

Interview with Joanna Alderson

Alderson
The Digital Economy Act, that forces internet service providers to help combat illegal file-sharing is lawful, the UK Court of Appeals has ruled. The Court rejected claims made by BT and TalkTalk that parts of the Digital Economy Act violate European Union laws. The ruling has been welcomed by representatives of the creative industries, but may yet be appealed by the two internet service providers to the UK Supreme Court. Michiel Willems spoke to Joanna Alderson, an Associate at Pinsent Masons in Birmingham, to examine the latest ruling.

What is the impact of today’s ruling on businesses and consumers?
This latest ruling effectively shuts another door on the attempts by the two providers to challenge the Digital Economy Act, clearing the way for implementation of the Act. Pending further appeal service providers will now have to play an active role in policing online copyright infringements by their users. Illegal file sharers will no longer be entitled to rely on the anonymity that the internet provides and will be subject to the ‘three strikes rule’ but this is still a long way from an obligation to monitor users' surfing.  

Should the latest ruling be seen as a victory for the creative industry?
The creative industry is certainly claiming the victory from the ruling and it does pave the way for the implementation of the Digital Economy Act. However, implementation will be a lengthy and complicated exercise and we have not seen a proposed timetable for this. How the Act will be implemented, policed and enforced remains to be seen.

BT and Talk Talk had argued that the Digital Economy Act breaches European laws on data protection and privacy, but the Court has dismissed this. What can you say about this?

Data protection and privacy laws permit disclosure of personal data - even sensitive personal data - where disclosure is required to establish, enforce or defend legal rights, under the UK interpretation. This exception necessarily has to include enforcement at a pre-action stage to enable the identification of potential defendants, even if action results in early resolution, as encouraged by the courts.

BT and Talk Talk also failed to convince the Court that the Act was ‘incompatible’ with provisions set out in the European E-Commerce Directive. What can you say about this?
The E-Commerce Directive was designed to ensure that the internet functioned efficiently. All parties in the communication chain are given certain protections from liability where acts complained of are outside their control. However, the E-Commerce Directive is written in a way to balance many competing interests. On the one hand providers are protected to the extent they have no knowledge of infringing acts but when in receipt of knowledge the level of protection changes - this has always been the case.

In a judicial review last year the High Court had rejected BT and Talk Talk's claims that parts of the law violate European legislation; now the Court of Appeals has confirmed this view. How likely is it that the Supreme Court will rule otherwise, do you think?
The service providers are said to be ‘considering their options’ in light of the ruling but it is felt that they have little option but to have one final go at forcing a rethink of the controversial provisions of the Digital Economy Act, by appealing to the Supreme Court. If an appeal is permitted, it will be interesting to see the grounds of any further appeal, particularly as the Court of Appeal appeared to have little difficulty in substantially upholding the first instance decision. The providers will not be able to raise any new or additional arguments on appeal. Further, appeals to the Supreme Court must show that there is a real public interest in the outcome of the case.

Anything else you would like to share with me?
It is understandable that internet service providers are throwing everything they can at challenging this legislation, which will have serious implications on the role of an internet service provider in policing online copyright infringement. Some providers have been quoted saying they will refuse to comply with the new legislation. Even if the Supreme Court does follow suit, we expect to see much more legislation relating to this controversial Act in the future.

Michiel Willems © 2012 CP Publishing Ltd. London, UK. Picture: Pinsent Masons

Journey to Israel - crossroads of religion and politics

Many religions - including Jews, Christians and Muslims - consider Israel and the Occupied Territories to be the Holy Land. The tiny strip of land is squeezed in between the Mediterranean Sea in the west, the desert of Jordan in the east, Lebanon in the north of its giant neighbour Egypt in the south-west. Israel is a spiritual, magnificent place full of history, myths, legends and holy sights. The world's only Jewish-majority state is a place where ancient civilizations find their roots, where history was made and is being made, where wars were won and lost and where some of the best movies ever made were shot. It is a country that keeps fascinating millions of people around the world, politically, historically and spiritually: Israel and the Occupied Territories truly are crossroads of religion and politics.

Below you can find some pictures that I took during a recent trip to Israel. After entering the country via the border with Jordan, we crossed Israel, heading for the coastal city of Tel Aviv - the country's largest and most vibrant city as well as its financial centre - followed by a trip to ancient Jerusalem, for many the spiritual and religious centre of the world. Our journey was concluded in Jaffa, just south of Tel Aviv, an ancient port city believed to be one of the oldest in the world. Modern Jaffa has a heterogeneous population of Jews, Christians and Muslims. For someone who is fairly non-religious, it was an interesting and eye-opening experience. In my view, you could say that the country's name reflects the current state of the country and its neighbours: Israel comes from Yisrael, meaning 'the one who wrestled with God'. Whose God remains unclear.

Entering Israel

Approaching Tel Aviv






In Jerusalem's Old City
Jerusalem's Muslim Quarter


At the Western Wall, Jerusalem


Dedication at a young age

Dome of the Rock Mosque

Sunset. View from the Mount of Olives
Gathering of Israeli soldiers

Entrance and exit to the Old City, Jerusalem
Eatery in the trendy area of Florentine, Tel Aviv
Tel Aviv skyline
Jaffa

Sunset in Jaffa




Ben Gurion Airport

Michiel Willems © 2011-2012 London, UK.

Friday, 9 March 2012

Green light for controversial Digital Economy Act

The controversial UK Digital Economy Act (DEA) is not incompatible with European Union legislation, the UK Court of Appeals in London has ruled. British internet service providers BT and Talk Talk have lost an appeal about those parts of the DEA that force ISPs to combat copyright infringements. Both internet providers had argued parts of the law are in conflict with European Union legislation, especially in relation to privacy and data protection issues. 

Talk Talk said in a statement it was ‘disappointed’ and the company is ‘considering [its] options’. It made clear that ‘though we have lost this appeal, we will continue fighting to defend our customers' rights against this ill-judged legislation’. A Spokesman for BT said “now that the court has made its decision” the company will look at the judgment “to carefully understand its implications and consider our next steps".

Joanna Alderson, an Associate at Pinsent Masons in London, said the latest ruling “shuts another door”, while Burges Salmon Partner Andrew Tibber thinks that the decision “gives a further impetus to the growing fight back against digital piracy”.since the Judge “has confirmed the legitimacy and enforceability of the online infringement of copyright provisions [of the DEA] are in line with European legislation”.

"The government will soon be forced to show its hand.”

Natalie Elsborg, a of Charles Russell, expects the ruling to have political implications: “An important effect of the judgment is that it is one more step in forcing the government to get off the fence and decide whether it is supporting the grossly unpopular [DEA]”, she said. “So far the coalition has let events play out and waited to see the approach taken by the courts, but with one fewer court left available to the businesses challenging the Act, the government will soon be forced to show its hand.”

Under the DEA, service providers are forced to send warning letters to users who have allegedly downloaded illegal files – such as Hollywood blockbusters and music. If warnings are ignored, ISPs will potentially cut users off. Both ISPs had argued such strict measures could potentially result in an invasion of privacy and could lead to enormous costs for ISPs as well as consumers. “The prospect of ISPs sending warning letters to subscribers suspected of file-sharing at the behest of rights holders is now one step closer”, said Tibber. “First notifications could be arriving in subscriber's inboxes in just over a year." 

"All users are to be presumed guilty by association.” 

Alderson remarked that “illegal file sharers will no longer be entitled to rely on the anonymity that the internet provides”, while Elsborg believes that under the DEA “it appears that all internet users are to be presumed guilty by association”. She explains: “[The DEA] will force users to take greater responsibility for monitoring activity in their own home. The data gathered by ISPs to establish a list of infringers may be limited to IP addresses, but it cannot identify whether the infringing download was made by the owner of the account or his teenage son from a wireless connection in his bedroom.”

BT has warned the strict measures could lead to enormous costs for consumers. Therefore, Elsborg fears “this decision will result in an increase in broadband fees. It remains to be seen whether the service providers will pass on the cost of investigating and dealing with users misusing their internet account to all users whether or not they are themselves guilty of such actions.”

Michiel Willems © EFPLP - 2011-2012 CP Publishing Ltd. London, UK. Pictures: (top) British Telecom/Talk Talk and (above) enterpriseofgreeks.blogspot.con

 

The search for a war criminal - Uganda's Joseph Kony

Joseph Kony
Directed by Joseph Kony, the Lord's Resistance Army has earned a reputation for its actions against the people of several African countries, including northern Uganda, the Democratic Republic of Congo, Central African Republic, South Sudan and Sudan. 

Under Kony's leadership, the LRA has abducted and forced an estimated 30,000 children to fight, kill, rape and abduct, and has forced the internal displacement of over 2 million people since its rebellion began in 1986. In 2005 Kony was indicted for war crimes by the International Criminal Court in The Hague (Netherlands), but - so far - he has evaded capture.

Although Joseph Kony left Uganda back in 2006 and his LRA has been reduced to nothing more than a handful of soldiers, this moving documentary is a bold attempt to hunt down Africa's biggest war criminal.

Picture: 411webmagazine. Video: copyright by 'Invisible Children', San Diego, USA.